Trade dress refers to features of the visual appearance of a product or its packaging (or even the facade of a building such as a restaurant) that may be registered and protected from being used by competitors in the manner of a trademark. These can include the three-dimensional shape, graphic design, color, or even smell of a product and/or its packaging.
There are two basic requirements that must be met for trade dress protection. The first is that those features must be capable of functioning as a source indicator-identifying a particular product and its maker to consumers. In the United States, package design and building facades can be considered inherently distinctive -inherently capable of identifying a product. However, product design can never be inherently distinctive, and so such trade dress or other designs that cannot satisfy the 'inherent distinctivness' requirement may only become protectable by acquiring 'secondary meaning.' In other words, the mark may be protected if it acquires an association in the public mind with the producer of the goods. (See main trademark article for more information on these concepts.)
Trade dress must also be nonfunctional in order to be legally protected; otherwise it is the subject matter of patent law, if anything. What is functional depends strongly on the particular product. To be nonfunctional, it cannot affect a product's cost, quality, or a manufacturer's ability to effectively compete in a nonreputational way. For example, color is functional in regards to clothing because that product is purchased substantially because of its color and appearance, but color is not functional on household insulation, which is purchased purely to be installed in a wall and never seen.
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