## Facts

- Valu Engineering, Inc. manufactured conveyor guide rails used along industrial conveyors to prevent containers from falling off.
- The rails were commonly used in wet areas of bottling and canning plants, where sanitation chemicals create corrosion concerns and equipment is typically made from non-corrosive materials.
- Valu filed three trademark applications (Feb. 25, 1993) to register ROUND, FLAT, and TEE cross-sectional configurations of conveyor guide rails on the Principal Register, claiming acquired distinctiveness under 15 U.S.C. § 1052(f).
- The PTO examining attorney approved the applications, after which Rexnord Corporation filed consolidated oppositions asserting: (1) the configurations were de jure functional, (2) Valu lacked ownership when it applied, and (3) Valu committed inequitable conduct before the PTO.
- The Trademark Trial and Appeal Board sustained the oppositions on functionality grounds, focusing on wet-area use, and rejected the inequitable-conduct claim.
- Valu appealed to the Federal Circuit; Rexnord cross-appealed on inequitable conduct.

## Issues

1. Whether the ROUND, FLAT, and TEE cross-sectional configurations of Valu’s conveyor guide rails are de jure functional and therefore unregistrable as trademarks.
2. Whether the functionality inquiry was legally flawed because it focused on wet-area bottling and canning applications rather than all possible uses.
3. Whether the TTAB erred in rejecting Rexnord’s inequitable-conduct theory.

## Decision

- The Federal Circuit affirmed the TTAB’s refusal to register the three configurations because substantial evidence supported a finding of de jure functionality.
- The court held the TTAB did not err by focusing on wet-area use; competitive significance in a commercially important application can establish functionality.
- Rexnord’s cross-appeal on inequitable conduct was dismissed as moot because functionality independently barred registration.

## Legal Principles

- Product design or configuration features that are functional in the trademark sense are not registrable, regardless of any showing of acquired distinctiveness.
- Functionality may be evaluated using the Morton-Norwich framework, including evidence such as utility disclosures in patents or applications, advertising touting utilitarian advantages, limited design alternatives selected for utilitarian reasons, and cost or performance benefits.
- Proof establishing a prima facie case of functionality shifts the burden to the applicant to prove nonfunctionality.
- A tribunal may assess functionality by examining whether a design is competitively necessary in a commercially significant context of use; it need not prove functionality across every conceivable use.

## Conclusion

The Federal Circuit affirmed refusal of trademark registration for Valu’s conveyor-rail cross-sectional shapes because the configurations provided utilitarian advantages and were competitively necessary in a key market application, making them de jure functional and unregistrable; the inequitable-conduct cross-appeal was therefore moot.


Valu Eng’g, Inc. v. Rexnord Corp., 278 F.3d 1268 (Fed. Cir. 2002)