Property, intangible

a blog about ownership of intellectual property rights and its licensing

Don’t Forget Trade Dress In Your Manufacturing Agreements

Tecnimed SRL v Kidz-Med, Inc. is a manufacturer-distributor dispute with a bit of a twist – the agreement was clear about who owned the trademark (the manufacturer), but it didn’t address who owned the trade dress for the product.

Tecnimed is an Italian company that makes a non-contact thermometer for taking a child’s temperature.  Kidz-Med was its U.S. distributor, but the relationship fell apart. Kidz-Med was allowed to sell off its remaining stock but had bigger plans in mind. It also started selling its own competing thermometer, selling it in similar packaging. The two sets of packaging are shown below:

Original packaging

Distributor’s later packaging

Kidz-Med claimed that it had created the trade dress for the packaging and therefore owned it.  On a motion for preliminary injunction, the court used the Wrist-Rocket and Sengoku factors to decide who owned the trade dress. Their agreement was no help; it didn’t address trade dress. In the absence of an agreement the manufacturer is presumed to own the mark, which can be rebutted by considering four factors: “(1) which party invented and first affixed the mark onto the product; (2) which party’s name appeared with the trademark; (3) which party maintained the qualify and uniformity of the product; and (4) with which party the public identified the product and to whom purchasers made complaints.”

For the first factor, Tecnimed showed that it was using components of the trade dress – the color scheme, the phrase “5 in 1,” the photo of a mother holding a sleeping baby, and some illustrations – before Kidz-Med became its distributor. This factor to Tecnimed.

Both parties had their marks on the packaging, the Kidz-Med mark in the bottom left corner and Tecnimed’s “ThermoFocus” mark at the top. “Accordingly, the trade dress is closely associated with ‘Thermofocus,’ and by extension with Thermofocus’s manufacturer and trademark registrant.” Nevertheless, Tecnimed’s name was not on the packaging, so this factor was a tie.

For the third factor, Tecnimed manufactured the thermometers, so controlled the quality of the goods. Kidz-Med, though, handled consumer complaints, so won on the fourth factor.  Tallying up, score two for Tecnimed, one for Kidz-Med, and one a draw.  That wasn’t enough for Kidz-Med to overcome the presumption and Technimed is the owner of the trade dress, which is also inherently distinctive.

But do you consider the two trade dresses likely to be confused?  How about, though, if you consider that Kidz-Med started out by reverse passing off the ThermoFocus thermometer as the “Kidz-Med 5 in 1 Non-Contact Thermometer,” used testimonials about the ThermoFocus thermometer to promote it, and then used the misdirection to pave the way for its own replacement thermometer:

In a January 2010 press release concerning the Thermofocus, Kidz-Med’s Director of Business Development falsely suggested that Kidz-Med was planning to release an updated version of the Thermofocus, by stating that “[w]e are excited to see that the media A-list are featuring our non-contact, hygienic thermometer [the Thermofocus] as a must-have during the flu season. Our new noncontact thermometer will be launching this year, and we hope for similar attention to be drawn to it too.”

Polaroid factors applied and Tecnimed ends up with the winning tally – “bad faith” alone might have been enough.

Tecnimed SRL v. Kidz-Med, Inc.No. 10 Civ. 7277 (S.D.N.Y. Jan. 18, 2011).

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