Business Startup

iVLG News Roundup Week 28: Trademarks; Management; Taxation; Online Privacy; etc.


Hershey’s Granted Trademark for Bar Configuration
The US Patent and Trademark Office’s (USPTO) Trademark Trial and Appeal Board granted Hershey’s trademark application for the design and shape of its chocolate bar. The Examining Attorney for the USPTO had refused registration on two grounds: (1) Hershey’s proposed mark was a functional configuration of the goods; and (2) it was a non distinctive configuration that had not acquired distinctiveness as required under Trademark Act Section 2(f), 15 U.S.C. § 1052(f). The Trademark Trial and Appeal Board overruled the examining attorney, finding that the configuration was not functional, and that it was sufficiently distinctive.

Hershey’s Trademark Application
Hershey’s description of its mark: “The mark is a configuration of a candy bar that consists of twelve (12) equally-sized recessed rectangular panels arranged in a four panel by three panel format with each panel having its own raised border within a large rectangle.”

In the opinion Judge Shaw stated the following with regards to how the appeals board considered the mark: “As to the precise nature of the proposed mark, the drawing and the description establish that the configuration of the candy bar is comprised of the following elements: 1. A rectangular candy bar divided into twelve segments, 2. The segments are equally sized and rectangular in shape, 3. The segments are in a four by three arrangement, and 4. Each segment is recessed with a raised border design. Regardless of whether each of the foregoing elements may be functional or non-functional, it is the overall combination of these elements that will guide our review of the merits of the refusals to register.”

A product feature is functional, and cannot serve as a trademark, if it is essential to the use or purpose of the article or if it affects the cost or quality of the article. The functionality requirement maintains the balance between patent and trademark law. In ruling that the configuration was not primarily functional, the board focused on the overall configuration. While the segmentation made it easier to break the bar into bite size pieces–a functional element of the configuration, the raised edges and three by four design were not functional:

“[E]ven if certain features found in applicant’s candy bar design are functional and common to other candy bars, it does not necessarily follow that the overall appearance of applicant’s candy bar configuration is functional.”

With regard to the distinctiveness requirement, Judge Shaw stated, “Ultimately, to establish acquired distinctiveness, an applicant must show that the product configuration sought to be registered is perceived by consumers as not just the product but, rather, that the design identifies the producer or source of the product.” The appeals board was persuaded of the distinctiveness requirement by consumer surveys and sales data of goods bearing the proposed mark.

Corporate Management

Google Exec Named Yahoo’s CEO
Yahoo hired former Google VP Marissa Mayer as its new CEO, becoming the company’s sixth CEO in five years. Ms. Mayer was employee number 20 at Google, and helped design the look of the search giant. Ms. Mayer is known as a product person, who is expected to overhaul the Yahoo brand.


Changes in Taxation of Online Sales
Breaks on state sales taxes may be coming to an end in the near future. As state leaders seek new revenue sources, many governors are dropping their opposition to taxation of online sales. Major online retailers have avoided state sales taxes thanks to a 1992 Supreme Court ruling which provided that companies lacking a physical presence in the state where the consumer lived would not have to collect sales tax. However, federal lawmakers are know proposing a bill, The Marketplace Fairness Act, which would give states the authority to compel online companies to collect sales taxes.

Online Privacy & Copyright Protection

Implementation of RIAA-ISP Agreement Delayed
The implementation of Internet Service Providers’ (ISPs) six strikes plan has been delayed. Last year ISPs, including AT&T, Comcast, Verizon and Time Warner Cable, entered into a voluntary agreement with RIAA and MPAA to regulate its users, agreeing to blacklist any users that engage in more than five separate actions of content theft. The agreement was supposed to take effect this month, but it is now being reported that the new plan will not be enforced until the fall. While something needs to be done to protect the rights of content producers who have their material stolen, it is frightening that mega corporations can make a deal among themselves to block people from Internet access. Something needs to be done, but this approach is a bit extreme, when there are already legal remedies available for copyright holders. This Fred Wilson article from earlier this year gets to the heart of the problem for content producers like RIAA and MPAA: they need to change their business model.


Kyle Hulten

When I'm not in the office I enjoy cooking, gardening, and watching my toddler son explore his little universe.