## Facts

- Clemens Franek designed and marketed a circular beach towel in the mid-1980s, advertising it as both fashionable and practically useful for sunbathers.
- Marketing materials claimed the round shape let a user reposition their body as the sun moved without moving the towel.
- In 1986, Franek’s company sought federal registration for the configuration of a round beach towel; the PTO issued the registration in 1988, and the mark was later assigned to Franek.
- Other market participants obtained utility patents involving circular towels or related designs; at least one patent described utilitarian advantages of a circular towel for sunbathing posture relative to the sun.
- In 2006, Franek learned Jay Franco & Sons, Inc. was distributing round beach towels to retailers, including Target and Walmart.
- Franek sued Target and Walmart for infringement of the registered configuration mark under the Lanham Act.
- Jay Franco, having agreed to indemnify and defend its retail customers, filed a declaratory judgment action seeking invalidation of Franek’s registration on the ground that the round configuration was functional.
- The district court granted summary judgment for Jay Franco, holding the configuration functional and the registration invalid; Franek appealed.

## Issues

1. Whether the circular configuration of a beach towel is functional product design and therefore ineligible for trademark (trade dress) protection under the Lanham Act.

## Decision

- The Seventh Circuit affirmed summary judgment for Jay Franco.
- The court held the circular configuration is functional because it is tied to the towel’s use and performance and would be needed by competitors to offer similar utilitarian benefits.
- Because functionality barred protection, the court did not need to decide whether the configuration had acquired secondary meaning.

## Legal Principles

- Product-design trade dress is not protectable if it is functional; functionality exists when a feature is essential to the article’s use or purpose or affects its cost or quality.
- Evidence supporting functionality may include utility patents describing utilitarian advantages of the design and advertising that touts functional benefits.
- Functionality defeats trademark protection even if the design is registered and even if the proponent claims consumer association with a single source (secondary meaning).
- Trademark law protects source identifiers, not useful product features that would improperly confer a potentially perpetual competitive advantage.

## Conclusion

The court upheld invalidation of the registration for a round beach towel configuration, concluding the shape was functional and therefore could not be protected as trade dress, leaving competitors free to use the circular design for its utilitarian advantages.


Jay Franco & Sons, Inc. v. Franek, 615 F.3d 855 (7th Cir. 2010)