Posted : 2012-09-02 13:19
Updated :  

Lessons from 'trade dress'

Solution is developing strong brand identity with help of distinctive design

By Kim Da-ye

After all, the winner of the epic legal battle between Apple and Samsung Electronics wasn’t the American tech firm’s design but its brand identity.

Apple’s victory isn’t easy for many outside the U.S. to accept. The patent on rounded corners of iPhones has not only been ridiculed but also raised concerns that such arbitrary patents could disturb the progress of the global IT industry.

But Apple’s another set of complaints based on trade dress attracted more attention than controversy here.

Apple claims that iPhones’ overall designs represent the firm’s brand and Samsung, by copying them, diluted its unique brand value.

For better understanding, let’s put that into a daily life situation. Jane dyes her hair red and wears a white T-shirt with torn blue jeans that her friends recognize as her unique style representative of her. One day Samantha comes and copies them, and Jane feels she no longer stands out with the same hairstyle and outfit. She is now angry and asks Samantha to stop copying her.

In the real world, companies can be harsher than Jane by going to court and asking the law to ban their competitors from doing business.

The concept of trade dress may not be familiar to most Koreans, but the lesson it teaches domestic companies is nothing new. The Apple vs. Samsung case is another reminder that Korean firms need to build strong brands and design should help create brand identity.

“Trade dress is important at least in the U.S. market, and it may gain significance in Korea as well. Technologies increasingly do not differ much from each other, so businesses try to differentiate from competitors with design,” said Oh Se-joong, senior partner at Haeorom International Patent & Law Offices and the country’s rare expert in trade dress.

Trade dress in Apple vs. Samsung

The easiest way to understand trade dress in depth would be by reading U.S. federal judge Lucy Koh’s final instruction to the jury that is publicly available. Koh presides over the Apple vs. Samsung case at the Sans Jose division of the U.S. District Court’s Northern District of California.

The judge asked the jury to think in two steps ― first, determine if Apple’s trade dress is protectable and then decide if Samsung’s alleged intentional copying lessened the capacity of the trade dress.

For a trade dress to be protectable, the product’s overall design ― the so-called look and feel ― must be distinctive and do not have any functions. The elements of the overall design may include “size, shape, color, color combination, texture or graphics.”

“You must consider the appearance of features together, rather than separately,” said the judge.

The subject of a trade dress isn’t limited to the actual product ― it can be the packaging or the projected image of the product in advertisements.

Design is considered functional if it created utilitarian advantages for the product, no alternative design is available and it affects the product’s cost or quality, Koh wrote.

To decide a dilution of trade dress, the judge ordered the jury to first find whether Apple’s was famous before Samsung brought out its accused products and then if the accused products can cause the trade dress lose its distinctiveness. It is about the possibility regardless of actual confusion or damages the defendant’s products have allegedly caused.

Companies do not need to register a trade dress to have it protected. Apple sued Samsung for diluting both registered and unregistered trade dresses of iPhones, iPad and iPad 2.

The jury found part of iPhones’ trade dress is protectable while concluding no dilution for those of iPads.

Only brand matters

One simple misunderstanding in dealing with trade dress is regarding it as a patent. It is more of intellectual property.

Oh Se-joong of Haeorom said that in order to patent design, it needs to be new and progressive. For trade dress, its overall design doesn’t need to be new.

“When the look and feel of a product have existed over a period of time and are capable of representing the brand itself, they are protected as a sort of a trademark, not a patent,” Oh said.

The most interesting character of trade dress is that it must be non-functional. “If it is functional and, therefore others require it in developing their products, one company cannot dominate the right to it. A functional design has no alternative, and granting exclusivity to such design would be against fair competition,” Oh said.

Trade dress shouldn’t be approached like how patents are. While companies register as many patents as they can to be competitive and some entities even make money only by collecting patents and suing others, trade dress isn’t developed overnight. It also cannot be owned by others like patent trolls.

As trade dress must be non-functional, its pure purpose is to protect brand identity. To keep a company away from a trade dress-related lawsuit, the only ways are innovation in design and establishing a brand identity.

Apart from its legal significance ― trade dress is protected under the Langham Act in the U.S. but the courts here have been strict against its impact, its important lesson is that Korean firms need to set up a design philosophy.

One example of improving practices is seen in the domestic automotive industry. A few years ago, Hyundai Motor and Kia Motors established a distinctive design philosophy and began applying similar design concepts throughout their fleet of vehicle models. Use of fluidic side lines and sharply shaped headlamps in the Hyundai Sonata and the grill resembling a tiger nose in Kia’s K5 are distinctive features of the so-called family look.

In an interview back in March, Alain Lonay, director of design at Renault Samsung, said, “There is no longer a very good car or a very bad car in terms of general quality. To develop a great engine technology requires long-term research and a huge amounts of investment. Design can lead to much more visible, quicker and cheaper innovations.”

Oh of Haeorom said that in Korea, patents on technologies are regarded as important but the significance of design tends to be ignored.

“When you enter a supermarket, you find Seoul Milk by the green package with a red logo, not by the words Seoul Milk. The combination of green and red colors represents the brand. If other milk brands copy that, consumers may get confused. That’s the core idea of trade dress,” Oh said.
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