Sixth Circuit Declines to Clarify Aesthetic Functionality Test (or Even Whether the Doctrine Has Been Adopted in This Circuit): Maker's Mark's Wax Seal Trademark Protected and Not Functional

The Sixth Circuit affirmed the Western District of Kentucky, finding that Maker's Mark's dripping red wax seal is protected as a trademark.  Maker's Mark Distillery, Inc. v. Diageo N. Am., Inc., Nos. 10-5508, 10-5586, 10-5819, 2012 U.S. App. LEXIS 9403 (6th Cir. May 9, 2012). The Sixth Circuit declined to settle which test should be applied by courts in the Sixth Circuit to determine whether the trademark was aesthetically functional, and therefore not enforceable.  The Court further refused to state expressly that the doctrine has been adopted in the Sixth Circuit.

Since 1953, Maker's Mark has bottled bourbon with a red dripping wax seal covering the top of the bottle.  Maker's Mark registered this trade dress as a trademark in 1985.  While the trademark is silent as to color, Maker's Mark sought to enforce the trademark only as applied to the color red.  In 1995, Jose Cuervo began producing premium tequila called Reserva de la Familia.  Prior to 2001, Jose Cuervo marked the tequila with a bottle that had a wax seal that was straight-edged without drips.  Beginning in 2001 (and ending around 2003), however, Jose Cuervo began selling the tequila in the United States with a red dripping wax seal reminiscent of the Maker's Mark bottle.

In 2003, Maker's Mark filed a lawsuit in the Western District of Kentucky against Casa Cuervo S.A. de C.V., Jose Cuervo International, Inc., Tequila Cuervo La Rojeña S.A. de C.V., and Diageo North America, Inc., alleging state and federal trademark infringement and federal trademark dilation claims.  After a six-day bench trial, the district court found in favor of Maker's Mark and permanently enjoined Jose Cuervo from using red dripping wax on the cap of a bottle within the United States.  The district court, however, found that Jose Cuervo did not dilute the Maker's Mark trademark and denied the claim for damages (although the Court did award some of its costs).  The district court also denied Jose Cuervo's counterclaim for cancellation of the trademark, determining that the red dripping wax seal was not "aesthetically functional."

While the Sixth Circuit has questioned the validity of the aesthetic functionality doctrine in this circuit (see Antioch Co. v. W. Trimming Corp., 347 F.3d 150, 155-56 (6th Cir. 2003)), the Court has stated that "where an aesthetic feature (like color), serves a significant function . . . courts should examine whether the exclusive use of that feature by one supplier would interfere with legitimate competition."  Antioch Co., 347 F.3d at 155.  Under the competition theory of aesthetic functionality, there are generally two different tests (the "comparable alternatives test" and the "effective competition test") used to determine whether a trademark is aesthetically functional, and thus not enforceable.  Abercrombie & Fitch Stores, Inc. v. Am. Eagle Outfitters, Inc. , 280 F.3d 619, 641 n.15, 642-43 (6th Cir. 2002).  The comparable alternatives test "asks whether trade-dress protection of certain features would nevertheless leave a variety of comparable alternative features that competitors may use to compete in the market."  Id. at 642.  Under this test, "[i]f such alternatives do not exist, the feature is functional; but if such alternatives do exist, then the feature is not functional."  Id.  In contrast, "[t]he effective competition test asks . . . whether trade dress protection for a product's feature would hinder the ability of another manufacturer to compete effectively in the market for the product."  Id.  (internal quotation marks and citation omitted; omission of text in original).  Under this test, "[i]f such hindrance is probable, then the feature is functional and unsuitable for protection"; but "[i]f the feature is not a likely impediment to market competition, then the feature is nonfunctional and may receive trademark protection."  Id. (internal quotation marks and citation omitted).

While the Sixth Circuit affirmed the decision from the district court (finding in favor of Maker's Mark), the Court refused to conclusively state that the aesthetic functionality doctrine was recognized in this circuit.  Maker's Mark Distillery, Inc., 2012 U.S. App. LEXIS 9403, at *15 ("[e]ven assuming we were to recognize aesthetic functionality doctrine").   Further, the Sixth Circuit failed to provide guidance on which test should be employed to determine aesthetic functionality, determining that under either test Cuervo's appeal "does not succeed."   Id.  The Sixth Circuit agreed with the district court's conclusion "'that it would [not] be difficult or costly for competitors to design around' the mark" and that "[t]here is more than one way to seal a bottle with wax to make it look appealing."  Id.  As a result, Jose Cuervo failed both tests.

Intellectual property lawyers in the Sixth Circuit will continue to wait for guidance from the Court regarding whether the aesthetic functionality doctrine is recognized in this Circuit and, if so, what test should be used to determine whether the trademark is unenforceable.


About The Author

Brian Wright | Faruki Co-Managing Partner