Two Pesos, Inc. v. Taco Cabana, Inc.

Citation. Two Pesos, Inc. v. Taco Cabana, Inc., 505 U.S. 763, 112 S. Ct. 2753, 120 L. Ed. 2d 615, 23 U.S.P.Q.2D (BNA) 1081, 60 U.S.L.W. 4762, 92 Cal. Daily Op. Service 5571, 92 Daily Journal DAR 8910, 6 Fla. L. Weekly Fed. S 643 (U.S. June 26, 1992)

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CitationTwo Pesos, Inc. v. Taco Cabana, Inc., 505 U.S. 763, 112 S. Ct. 2753, 120 L. Ed. 2d 615, 1992 U.S. LEXIS 4533, 23 U.S.P.Q.2D (BNA) 1081, 60 U.S.L.W. 4762, 92 Cal. Daily Op. Service 5571, 92 Daily Journal DAR 8910, 6 Fla. L. Weekly Fed. S 643 (U.S. June 26, 1992)

Two Pesos, Inc. v. Taco Cabana, Inc., 505 U.S. 763, 112 S. Ct. 2753, 120 L. Ed. 2d 615, 1992 U.S. LEXIS 4533, 23 U.S.P.Q.2D (BNA) 1081, 60 U.S.L.W. 4762, 92 Cal. Daily Op. Service 5571, 92 Daily Journal DAR 8910, 6 Fla. L. Weekly Fed. S 643 (U.S. June 26, 1992)

Brief Fact Summary. Taco Cabana, Inc. (Plaintiff) sought to assert trademark protection for its trade dress, despite such dress not having acquired a secondary meaning.

Synopsis of Rule of Law. Trade dress that is inherently distinctive may be subject to trademark protection even if it has not acquired a secondary meaning.

Points of Law - Legal Principles in this Case for Law Students.

The ultimate offense always is that defendant has passed off his goods as and for those of the complainant.

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Facts. Taco Cabana, Inc. (Plaintiff) operated six restaurants in the area of San Antonio, Texas. The restaurants strived to serve their Mexican food in a festive, colorful atmosphere. Two Pesos, Inc. (Defendant) began opening its own chain of restaurants with a similar atmosphere and featured similar dÃ©cor. Taco Cabana (Plaintiff) brought a trademark infringement action under the Lanham Act, arguing that it enjoyed a trademark on its â€œtrade dress,â€ which may be loosely defined as the totality of its ambiance. The district court held that trade dress could be a trademark if it was inherently distinctive or had acquired a secondary meaning. The jury found Plaintiff’s trade dress to be inherently distinctive and awarded damages. The court of appeals affirmed. The United States Supreme Court granted review.

Issue. Is trade dress that is inherently distinctive subject to trademark protection even if it has not acquired a secondary meaning?

Held. (White, J.) Yes. Trade dress that is inherently distinctive may be subject to trademark protection even if it has not acquired a secondary meaning. A mark may be trademarked if it is distinctive, per the Lanham Act. A mark is distinct if it is either (1) inherently distinctive, or (2) has acquired a secondary meaning. Secondary meaning refers to that situation where an aspect of a product that is not necessarily distinctive on its own has, either through successful marketing or some other mechanism, become associated in the public mind with that product. As a consequence of these definitions, a mark cannot be both inherently distinctive and have secondary meaning at the same time. From the above it follows that, to the extent that trade dress is inherently distinctive, it is not required to have secondary meaning to be subject to trademark law. In this case, the jury found Taco Cabana’s (Plaintiff) trade dress to be inherently distinctive, and this was sufficient to bring it within the Lanham Act. Affirmed.

Discussion. There are five categories it is generally agreed that marks may fall into: (1) generic; (2) descriptive; (3) suggestive; (4) arbitrary; or (5) fanciful. The last three categories are inherently subject to trademark law; the first is not. In trademark law, most issues relate to the second category.

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