The Third Circuit affirmed the cancellation of plaintiff PIM Brands, Inc.’s (“PIM”) trademark for “the shape of a wedge for candy, with an upper green section with white speckles, followed by a narrow middle white section and followed by a lower red section with white speckles” because “the whole trade dress of the red-white-and-green wedge [is] functional when applied to a watermelon candy.” PIM Brands, Inc. v. Haribo of Am. Inc., No. 22-2821, 2023 U.S. App. LEXIS 23745 (3d Cir. Sep. 7, 2023). PIM’s watermelon-colored wedge trademark looks like this:

PIM used the trademark in connection with Sour Jacks Wedges, of which the original version is watermelon flavored. The defendant, Haribo of America Inc. (“Haribo”), began selling its own watermelon candy that PIM alleged was a copy of PIM’s watermelon trademark. Haribo denied the accusations, arguing (among other things) that PIM’s watermelon trademark was functional. The district court agreed with Haribo, found PIM’s watermelon trademark was functional, and granted summary judgment cancelling the mark. PIM appealed.

The Third Circuit began its analysis by recognizing that “trademarks protect features that are arbitrary, ornamental, or the like” so “a trademark can be cancelled if it ‘comprises any matter that, as a whole, is functional.’” Even if a design functions as a trademark (by promoting a brand), it is still subject to cancellation if it has any positive effect on the cost, quality, or other feature of the product. PIM argued that the court should analyze the wedge shape of its trademark separate from the color of the wedge to determine functionality. The Third Circuit had little issue dispensing with that argument: “When a trade dress has an identifiable function, do we need to analyze each feature separately to see if it independently contributes to that function? No.” So, does the watermelon-colored wedge serve a function? The parties and court agreed that the color scheme was functional because it identified the watermelon flavor. The court further held that no reasonable jury could find the combination of the colors and shape to be non-functional. “On this issue, the parties’ photos are worth a thousand words of briefing. . . :

Any reasonable juror would agree: The whole trade dress, not just the colors, makes this candy resemble a watermelon slice.” Thus, “PIM cannot use its trademark to shut down Haribo’s competing candy” and the judgment of the district court was affirmed.