Ford Design Patents Block Import of Repair Parts – Infringers Call for Patent Reform

Patent.Law031In re Certain Automotive Parts, 2007 WL 2021234 (ITC 2007)

Ford Motor Company owns dozens of design patents covering various aspects of its vehicle designs. D496,890, for example, covers a vehicle grille; D493,552 covers a vehicle head lamp; D503,135 covers a bumper lower valance; and D496,615 covers a side view mirror. In 2005, Ford initiated a Section 337 action before the International Trade Commission (ITC) asking for an exclusion order against various auto parts importers whose imports violated the Ford design patents. For the most part, the accused parts are used to repair post-crash vehicles.

An administrative law judge (ALJ) found that the majority of the asserted patents were valid and infringed, although some patents were invalid.  The ITC then issued an order to exclude importation of the unlicensed repair parts.

Repair doctrine: Over the years, courts have created a non-statutory doctrine of permissible repair. Under the doctrine, post-sale repairs made to a patented object are not considered actionable. On the other hand, reconstruction of the patented object will be actionable as an unlicensed “making” of the invention.

Although interesting, the repair doctrine does not apply here. The accused infringers are not repairing anything — rather, they are importing replacement parts that on their own are infringing.

Calls for Patent Reform: After losing on the merits, the would-be importers have jumped on the patent reform bandwagon asking for a “repair parts” exception to the design patent laws. [Quality Parts Coalition]. Car manufacturers would like to go the other way — adding vehicle hull design protection to the Copyright Act. [See Boat Hull statute]

Appeal: The case, captioned as Ford v. ITC, 07–1357, is now on appeal at the CAFC — A decision is expected summer 2008.  The critical question for Ford — will the patents pass the CAFC’s dreaded points-of-novelty test?

39 thoughts on “Ford Design Patents Block Import of Repair Parts – Infringers Call for Patent Reform

  1. Especially as to internal mechanical replacement parts usually never even seen by the normal purchaser with no relation to their value or purchase from their allegedly “ornamental” features.

  2. Especially as to internal mechanical replacement parts usually never even seen by the normal purchaser with no relation to their value or purchase from their allegedly “ornamental” features.

  3. Especially as to internal mechanical replacement parts usually never even seen by the normal purchaser with no relation to their value or purchase from their allegedly “ornamental” features.

  4. “*I* would only want to pay for the design of a car when I buy the car.”

    Joe, I understand what you are saying. As a consumer, I want the same. Actually, I probably want more – the low printer price *and* the low ink price!

    “You can’t always get what you want….”

  5. Re the comment: “Car buyers take cost of repairs into consideration when they purchase new cars.”

    Yes, I am familiar with that argument from antitrust defense attorneys, but do you have unbiased scholarly customer survey economic data to cite in support of that premise from normal unsophisticated car purchasors, not just sophisticated corporate fleet purchasors?

    Also, this same issue of design patent protection for replacement parts, especially those that HAVE to MATCH original parts in order to to fit or otherwise be acceptable, has raged in Europe for many years. Especially as to internal mechanical replacement parts usually never even seen by the normal purchaser with no relation to their value or purchase from their allegedly “ornamental” features.
    Design patents are also very easy to obtain. Recent CAFC case law seems to be narrowing the scope of protection and validity of U.S. [but not European] design patents, but there has not been significant lowering of the high legal costs and delays of defending against patent suits.

  6. “Lower the initial price to attract consumers, and then still make a reasonable profit through the product lifecycle.”

    Yes I am convinced that the automakers are spreading out the revenue by lowering the initial price to make it look attractive. Perhaps my expression wasn’t clear to you, but that was exaclty what I wanted to imply.

    And yes, I did not make that statement based on facts/evidence. It is my belief what the automakers should do. So you were absolutely right in saying my assumption was baseless, although I didn’t assume anything apart from expressing what I think should happen.

    If you allow me to rephrase, again bearing in mind that it’s only my belief, and not based on any facts/evidence, what I’m saying is that if *I* am the buyer, *I* would only want to pay for the design of a car when I buy the car. The automakers should, in fairness to the consumers such as *myself*, put the premium associated with the design in the initial costs, because *I* would only want to pay for the deisng when I buy car, and not when I repair.

    Again I did not make this statement based on facts/evidence.

    I hope I make myself clear this time.

  7. “From a buyer’s perspective, I already paid that premium when I bought the car, why would I need to pay that again when repairing?”

    But Joe, who says you’ve already paid the premium at purchase? Your assumption is apparently baseless and perhaps completely incorrect. What if, like with ink jet printers and ink, the initial purchase price was made *lower* by the manufacturer in view of the statistically expected income stream which would be generated by the product over its lifetime? Now that would be good business operations by an automaker, wouldn’t it? Lower the initial price to attract consumers, and then still make a reasonable profit through the product lifecycle.

  8. “But it is amazing how American automotive makers can make a $20,000 car from $150,000 of parts”

    I guess the above sums up why non-OEM repairers are needed to ensure competition. I believe auto makers should charge buyers a premium for the design of a car when selling the car, but not when repairing them. From a buyer’s perspective, I already paid that premium when I bought the car, why would I need to pay that again when repairing?

    Not that many on this blog readers would care much, but in Australia we have legislated a repair defence for auto repairer and non-OEM manufacturers – it is not an infringement to use or import a patented design if it is for repair.

    You may think the non-OEM manufacturers could become free riders, but the defence is also narrow enough to only defend those who are really repairing. Sounds fair to me (again using the logic that I already paid the premium for the design when deciding to buy the car itself).

  9. Per Mr. Mooney, “Design patents are a sham.”

    Perhaps this may be true in the case of the industries with which he comes into daily contact, but it is most definitely not true in others. Merely by way of example, and not limitation, the judicious pursuit of both utility and design patents within the aerospace industry can many times represent a formidable challenge to third parties intent on absconding with post-manufacture OEM support.

  10. anonymous-

    agreed, design patents are the easiest patent to design around.

    c’mon..stop crying and start re-designing…

  11. ornamental design – nuff said.
    someone educate the repair parts market please.
    These should be easy as hell to overcome if you focus on mere functionality.
    The parts may not look right – but if they function ok – consumers will have a choice. Get for $50 something that f()s but doesn’t look quite right, or $500 for true OEM.

  12. I agree with Gideon. Adding special provisions for one industry can make a mess of the law.

    But it is amazing how American automotive makers can make a $20,000 car from $150,000 of parts (which comedian said that?). Tieing patented parts to the repair of the automobile helps keep that dream alive – but I’d rather rely on consumer diligence than governmental control or Swiss-cheese legislation to solve that.

  13. Somehow, I’m not sure how, Malcolm missed the whole point of this post/thread.

    This has been another edition of ….

  14. “we’re all very concerned about Ford and just got distracted with issues of patent reform”

    Design patents are tools for corporations to beat each other over the head with. How does the public benefit from design patents? Is the idea that without design patents, people will not be motivated to design ornamental features to make their products more appealling to the public?

    Give me a break. Design patents are a sham.

  15. Yes, thank you Malcolm – we’re all very concerned about Ford and just got distracted with issues of patent reform.

  16. “If the defendants do a good identifying prior art, the answer is no.”

    If the issue is whether a given patent can stand up on patentability grounds, that’s one thing.

    Trying to get an exemption against all patents of a given type is quite another.

  17. “The critical question for Ford — will the patents pass the CAFC’s dreaded points-of-novelty test?”

    If the defendants do a good identifying prior art, the answer is no.

    This has been another edition of ….

  18. Now we are condoning knock-offs!!!!

    This is ridiculous…

    QPC (a.k.a. Knock-off auto parts made in China and other countries with cheap labor and no IP laws) lose against a U.S. auto company and now they lobby (a.k.a. bribe) congress to include an exception in the new patent reform bill.

    It is time for Congress to wake and ask one question “Do we want a country with strong IP protection?” Yes or No. Only until that quesiton gets answered will there be any resolve.

  19. Indeed mold – of course they’re also only complaining about replacement parts for cars and trucks. If it’s such a great thing, then why don’t we extend it to ALL parts of ANY product???

  20. Just shows you how disingenuous the patent reform debate is really about. Now you have knock off guys complaining about the right to make mold copies (what these guys are doing in taking the existing part and making a mold and then cranking out identical copies). they are too lazy and cheap to even bother to make an original mold. pathetic.

  21. Really Alun? I guess Toyota (D508003), Honda (D508447), Daimler-Benz (D410421), Hyundai (D455690), etc. are also in poor shape? (the referenced design patents are all for side mirrors – i.e., replaceable parts for cars of the identified companies)

  22. As a couple of people have pointed out, although the law supports what Ford are doing, their decision to do it reduces the desirability of their vehicles for many people. Would I knowingly buy a vehicle from a company that blocks pattern parts? Never. OTOH, I suspect that this usually happens without this much publicity. Harley-Davidson used to place ads urging people not to buy pattern parts, but stopped due to criticism, and they weren’t even preventing people from obtaining the parts. These aren’t signs of a profitable company, but rather one that is in such poor shape that they hope replacement part sales will rescue their bottom line.

  23. “To me, it’s obvious what the makers of the repair parts should do. They should make parts that fit into the appropriate Ford/OEM vehicle, but which artistically look different. It’s fairly easy to design a replacement that aesthetically recalls the style of the OEM part and fits the connections without infringing the design patent.”

    O.K., perhaps this is a very good solution for the U.S. That way, non-OEM manufacturers will actually have to use some brainpower before manufacturing a part, and then maybe their costs will not be so much lower than the OEM prices. And OEMs will be rewarded for their novel designs, while consumers will still have an option.

    For Europe (which operates with “moral rights” in the copyright regime), I wonder if you would be allowed to change the shape of a Mercedes, especially if Daimler found the new shape degrading or “detracting”, or do moral rights not come into play with the artistic shape of a car?

    “The preserving the integrity of the work bars the work from alteration, distortion or mutilation. Anything else that may detract from the artist’s relationship with the work even after it leaves the artist’s possession or ownership may bring these moral rights into play.”

    link to en.wikipedia.org

  24. The repair-reconstruction issue relates to whether you can seek damages for replacing a non-patented component to “re-create” a patented combination. If the replaced component it patented by itself, the question is simple because you’re replacing (or “reconstructing”) the entire patented invention — thus infringement. That’s why the alternative replacment part provides (read “knock-off”) people want an exception. But who doesn’t want a free pass to infringe?

    It doesn’t make sense to have a special exception for these people. If one can get a patent broad enough to cover a replaceable part (whether a utility-patented light bulb or a design-patented side view mirror housing), one should be able to own the replacement part market. If, however, they can only claim the replacement part as part of a larger combination, the repair-reconstruction doctrine should provide the correct balance between allowing purchasers to repair their device without trampling on the patentee’s right for payment for a reconstruction.

  25. To me, it’s obvious what the makers of the repair parts should do. They should make parts that fit into the appropriate Ford/OEM vehicle, but which artistically look different. It’s fairly easy to design a replacement that aesthetically recalls the style of the OEM part and fits the connections without infringing the design patent.

  26. re: real anonymous at 09:04 am

    If your problem is the asymmetry of your fixed car, the amount of $$ the car company could charge you would be capped by the amount it would take you to buy a left panel AND a right panel (i.e. solving the asymmetry problem). In other words, there are still some market forces working on your behalf.

    Also, while the issue here is various car parts, there are also design patents for the entire car. IIRC, D500,000 is for the Crossfire car. Presumably, those could be asserted as well. I can’t think of a way to logically argue that only some design patents should be enforceable (i.e. the parts patents, but not the car patents).

  27. “Oh great, now we have the “cry” from QPC for “relief” for infringing “knockoff” parts suppliers under the rubric of Patent Law Reform.”

    It seems to me that there are two, and only two, primary opposing interests that Congress and the USPTO should be considering with regard to the Constitutional exclusive right: that of the patentee and that of the citizenry.

    Somehow (with $$$?), economically powerful domestic and foreign competitors have found a way to usurp both Congress’ and the USPTO’s affections, to thereby displace from primary considerations both the patentees and the U.S. public.

    Thoughts? Am I wrong that the government should represent the interests of the citizenry rather than some metaphysical “competition from the moneymovers is always better” agenda?

    [No Malcolm and Jon, competitors do not represent the U.S. public, only the stockholders.]

  28. Me too wrote: “why couldn’t the car companies (like Ford) charge me $2000 or $5000 for the left-front quarter panel? What are my options? Ride a wreck which any ordinary observer can see is not like the original? Buy a new car? From whom?”

    Ford cannot charge $2000-5000 for the quarter panel because people would stop buying Fords when it becomes known that it costs a fortune to repair the car. If Ford charges $2000 for a fender, a competing company, e.g., GM or Honda, can charge $1500 for fender replacements and now they have a car that’s cheaper to repair.

    The issue here is that Ford, based on this ruling, has market power for replacement parts for Ford vehicles. However, Ford does not have market power when it comes to selling new vehicles. Car buyers take cost of repairs into consideration when they purchase new cars, so Ford has to be competitive with other car manufacturers in what it charges for its replacement parts, which means they aren’t gouging the consumer.

  29. “Now, should you be able to go buy one rim from some knockoff manufacturer for half the price, even though the company that manufactured original rims has a design patent?”

    To me that’s an easy question: no, because it’s not a repair. Your second question (which in my mind probably describes a repair, and more so if the rims were standard equipment rather than an upgrade) raises the policy question you have referred to. And your question could be extended to cover e.g. patented headlights, tires, transmission fluids, spark plugs, etc. I’m not saying the answers are easy, but I would say we shouldn’t avoid the questions (laissez faire) merely because the questions are daunting. There certainly is place for patent reform when conducted from a position of reasoned knowledge (which position is unfortunately largely lacking in the current reform bills).

  30. “Calls for Patent Reform: After losing on the merits, the would-be importers have jumped on the patent reform bandwagon asking for a “repair parts” exception to the design patent laws. [Quality Parts Coalition]. Car manufacturers would like to go the other way — adding vehicle hull design protection to the Copyright Act. [See Boat Hull statute]”

    Oh great, now we have the “cry” from QPC for “relief” for infringing “knockoff” parts suppliers under the rubric of Patent Law Reform. I wouldn’t be surprised if QPC has a very large contigent of foreign members. Look at who the alleged infringers are In re Certain Automotive Parts case: foreign companies importing infringing replacement car parts. Could there be a connection here?

  31. real anonymous – I understand your point, but what you are arguing is really more of a policy question. Which, of course, is why the “Quality Parts Coalition” is lobbying Congress for yet another exception to the patent laws. While there is some merit to their arguments, I do not think we should make exceptions in our patent laws for specific industries/products. And don’t forget that many consumers consider repair costs when evaluating which car to buy – such statistics are readily available, and presumably take into account the availability of non-OEM parts for each model.

    It’s also not clear to me what the QPC is seeking. Do they want an outright ban on design patents for vehicle parts? Or, are they seeking something akin to what was done with surgical method patents (can’t be enforced against doctors)? In other words, design patents for replacement parts cannot be enforced against parts manufacturers, but could be enforced against other vehicle manufacturers? That one would be rather tricky to draft. An outright ban on design patents for vehicle parts, on the other hand, seems very problematic. Since every externally visible feature on a vehicle (panels, mirrors, grills, rims, hood ornament, etc.) is provided by a replaceable part, I’m not sure how you could have a ban on such patents without eliminating ALL vehicle design patents.

    And what about this scenario – you go out and drop $3000 on a set of bling bling rims for your brand new lowrider. You bought them at the local rim shop – they did not come from the automaker. While bouncin through town, a dump truck throws a rock into one of your expensive rims, cracking the rim. Now, should you be able to go buy one rim from some knockoff manufacturer for half the price, even though the company that manufactured original rims has a design patent? Most people (other than Malcolm) would say no. But what if instead of the local rim shop, you got the rims as a $3000 upgrade when you bought the car off the lot (i.e., the rims were made by the automaker and offered as an add-on to the vehicle). Should that be treated differently simply because they were included on the original new vehicle you purchased?

  32. I have no problem with Ford getting design patents and then blocking the after market parts market.

    Of course, this is just one more item on my very very long list of “why I would never buy a Ford.”

  33. “For example, non-OEM manufacturers are free to make and sell fenders which are functionally suitable for replacing a damaged fender as long as the fender they make and sell is not ornamentally the same as that claimed in the auto maker’s design patent(s).”

    Metoo, good point. But assume momentarily I have a right to repair with non-OEM parts. If by legislation you require such ornamentally dissimilar parts from non-OEMs and I damage my left front quarter-panel and can only obtain a replacement non-OEM panel which asymmetric to my right panel, haven’t you just reduced the value of my repaired car? (Or would you buy such a car from me?)

    It seems to me this is all about whether OEMs should be allowed to “tie” replacement parts to the purchase of new vehicles? If they are so allowed (and non-OEMs are not allowed to copy their ornamental designs for repair), the why couldn’t the car companies (like Ford) charge me $2000 or $5000 for the left-front quarter panel? What are my options? Ride a wreck which any ordinary observer can see is not like the original? Buy a new car? From whom?

    (My logic starts to fail when it is applied to the utilitarian design of car parts, but the questions still appear relevant and/or daunting.)

  34. As Dennis correctly noted, the flaw in all of this is that the auto maker design patents do not prevent repair. For example, non-OEM manufacturers are free to make and sell fenders which are functionally suitable for replacing a damaged fender as long as the fender they make and sell is not ornamentally the same as that claimed in the auto maker’s design patent(s).

  35. “I agree with the theory that complete replacement of a fender is not repair of the fender.”

    But it is repair of the car. And the product you sold me and I purchased from you and have the right to repair is the car, not the fender. (Well, at least that is my opinion.)

  36. I used to work for an auto company (not Ford). We believed that design patents were one way to stop insurance companies from using non-oem replacement parts and filed many such patents.

    I agree with the theory that complete replacement of a fender is not repair of the fender. I also think that a body shop that takes a damaged fender and returns it to the original patented shape is practicing permissible repair.

    It seems Ford has the same idea.

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