A recent Third Circuit decision  with implications for both brand owners and makers of store-brand and private-label goods held that the overall commercial impression of some store-branded packaging trade dress did not support finding a likelihood of confusion with brand-name packaging because the imitation packaging prominently featured other distinguishing marks, including store names and logos.
Plaintiff McNeil Nutritionals sought relief for infringement of the trade dress for its Splenda® sucralose sweetener by Heartland Sweeteners, maker of store-brand sucralose sweeteners for Ahold, Food Lion, and Safeway. The District Court denied a preliminary injunction for all of the packaging designs, finding that McNeil was unlikely to succeed on the merits of proving likelihood of confusion. The Third Circuit affirmed this decision in part, reversing and remanding only with respect to the Ahold packaging.
Establishing trade dress infringement requires proof that the allegedly infringing design is (a) non-functional and (b) inherently distinctive (or has acquired secondary meaning), and that (c) consumers are likely to confuse the source of the defendant’s product with that of the plaintiff’s. In the Third Circuit, the likelihood of confusion analysis centers on ten factors, including the degree of similarity between the plaintiff’s and defendant’s trade dress; strength of the plaintiff’s trade dress; relative care of the consumers who purchase the type of product; evidence of actual confusion; similarity of the channels of trade; and similarity of sales efforts.
The trade dress at issue related to boxes of individual sucralose packets and bags for granular sweetener. The Splenda boxes have a horizontal orientation (longer horizontally than vertically) with a yellow background, the name “Splenda” in italicized blue lettering at the top-center front surrounded by a white cloud. The Splenda bags have a vertical orientation with a front design essentially the same as the boxes. Both the Splenda and store-brand packaging have a number of similar elements, including the orientation, overall yellow background color, blue lettering, and photographs of uses for the sweetener (cups of coffee, containers of iced tea, pastries, bowls of cereal or fruit, etc.).
In finding the Food Lion packaging dissimilar to the Splenda packaging, the District Court pointed to the prominent display of the Food Lion name, which is well-known to the relevant consumers, and to a vertical element dividing the package into two parts, similar to other Food Lion packaging. In finding the Safeway packaging dissimilar, the District Court highlighted the prominent display of an S-shaped element that divides the box into 2 portions and leads the consumer’s eye to the Safeway name and logo. In affirming the District Court’s holding, the Third Circuit viewed the absence of the Splenda mark and the prominent display of the names and logos of the respective Safeway and Food Lion stores as “the most important difference.” The Third Circuit noted that while the mere absence of the brand name is not sufficient to cure otherwise infringing trade dress, the prominent presence of another well-known word or design mark might suffice, because such prominent presence may cause enough difference in the overall commercial impressions to weigh similarity in the defendant’s favor.
Although McNeil argued the District Court failed to give adequate weight to the imitation packaging’s yellow color, the Third Circuit disagreed, noting that consumers are aware that both brand-name and store brands share the same color for other types of sweeteners and that some packaging for sugar includes a yellow background. Therefore, consumers would not necessarily associate yellow for sucralose with the Splenda brand. The Court also found it appropriate to weigh distinctive design features more heavily than commonly used features (such as the yellow color and photos suggesting uses for the product), because distinctive design features are more likely to impact the overall commercial impression.
In reversing the lower court on the Ahold packaging, the Third Circuit found similarity too important a factor for the District Court to have found no likelihood of confusion when most of the other factors weighed in favor of McNeil or were neutral. The Ahold packaging was found similar in part because there was no distinguishing feature such as the Food Lion vertical bar or the Safeway S-shape, and because the “Sweetener” product name was placed at the top and front of the packaging just like the product name on the Splenda packaging.
Tips for Private-label packagers
- Prominently display distinguishing well-known marks or devices, such as store logos or other eye-catching elements. Elements that are commonly used in the field may be imitated, so long as other distinctive and distinguishing features are prominently displayed.
- Avoid placement of product names and logos in the same place on the package or in a lettering style too closely resembling that used by the branded packager.
- As a long range goal, seek to develop a distinctive and consistent branding style, including the use of trademarks and trade dress that can be immediately recognizable by consumers as an indication of source.
Lessons for Brand-name packagers
- Design product packaging using as many elements as possible that are uncommon to other package designs in the field.
- When identifying the field to be surveyed for common features, view the field broadly (e.g., sweeteners, not just no-calorie sweeteners).
- To strengthen consumer recognition of a particular feature and to establish secondary meaning before imitators come to the market, consider using “look-for” advertising that reflects the feature to be protected (e.g., “Look for the only no-calorie sweetener in the yellow package”).
Ramifications beyond store brands
While the Third Circuit explicitly recognized that store brands can arguably “get away” with a bit more similarity as long as a well-known label is prominently displayed, whether the prominent display of another well-known mark will suffice in other contexts will depend upon the ultimate question of how the display is likely to be perceived by the relevant consumers. The proper focus must always be on whether the trade dress is so similar that it creates a genuine likelihood of confusion.
 McNeil Nutritionals, LLC v. Heartland Sweeteners, LLC., 511 F3d 350 (3d Cir. 2007),