Dippin’ Dots fails to freeze out competition with trade dress claim

In Dippin’ Dots Inc v Frosty Bites Distribution LLC, the US Court of Appeals for the Eleventh Circuit has upheld a district court decision and has ruled that the defendant did not infringe the plaintiff’s trade dress by producing an ice cream product in a similar shape and colour scheme to that manufactured by the plaintiff. It held that the plaintiff’s product design was functional and thus not subject to trade dress protection.

The undisputed facts of the case established that Dippin’ Dots Inc had created an innovative, flash-frozen ice cream novelty product – ice cream in small coloured beads. The Dippin’ Dots product was marketed primarily at amusement parks, sporting venues and shopping malls, using a logo composed of “an oval of blue, yellow and pink spheres surrounding the product name Dippin’ Dots in blue letters”.

Frosty Bites Distribution LLC (FBD) was set up by a number of former dealers of the Dippin’ Dots product. While still acting as dealers for Dippin’ Dots, they created a competitive product consisting of coloured popcorn-shaped bites of ice cream. The dealers stopped selling Dippin’ Dots and began selling their own product, known as Frosty Bites, in the same venues where they previously had sold the Dippin’ Dots product. FBD's logo for its product consisted of:

“an ice-like background upon which the words ‘Frosty Bites’ are written in blue letters shadowed in pink. The ‘o’ in the word ‘Frosty’ is the torso of a cartoon caricature of a portly penguin holding a cup of yellow, green, blue and red nuggets of ice cream.”

Based on these undisputed facts, the US District Court for the Northern District of Georgia granted summary judgment to FBD, finding that (i) Dippin’ Dots’ look or trade dress, whether broken into component parts or considered as a whole, was functional and unprotectable, and (ii) the two companies’ logos were so dissimilar on their face that as a matter of law there was no likelihood of confusion.

On appeal, the Eleventh Circuit agreed. It focused on the requirement that the trade dress owner bears the burden of demonstrating that its trade dress is non-functional. Dippin’ Dots contended that the absence of colour and size from the utility patent covering the Dippin’ Dots product established that its trade dress was not functional. The court disagreed. It found that the colour of the Dippin’ Dots beads was functional “because it indicates the flavour of the ice cream, for example, pink signifies strawberry, white signifies vanilla, brown signifies chocolate”. The court noted that while FBD’s copying of the Dippin Dots’ colours may have been unwarranted, it did not follow that such exact copying somehow created protectable trade dress for Dippin’ Dots. Likewise, the court found the size of the beads and the round shape functional, because (i) the size aided the “product’s creamy taste”, and (ii) the shape contributed to the product’s commercial marketability.

Accordingly, the court found that the elements of the Dippin’ Dots product that FBD had copied, whether considered individually or in combination, could not be found to constitute protectable trade dress. Although the court acknowledged that FBD’s copying properly could be characterized as “immoral or unethical”, it simply did not constitute trade dress infringement. Dippin’ Dots could not freeze out competition from the flash-frozen ice cream market based on a claim of infringement of the look of its product when that look was functional.

Rochelle D Alpert, Morgan Lewis & Bockius LLP, San Francisco