Apple v. Samsung: Design Patents Win

By Jason Rantanen

Apple Inc. v. Samsung Electronics Co., Ltd. (Fed. Cir. 2015) Download Opinion
Panel: Prost (author), O’Malley, Chen

Apple prevailed at the district court on trade dress, design patent and utility patent claims, with a total award of almost a billion dollars.  On appeal, the Federal Circuit reversed on trade dress but affirmed on the design and utility patents.  The big winner in this case, though, are design patents: the Federal Circuit rejected Samsung’s attempt to exclude functional features from the infringement analysis and affirmed the district court’s award of Samsung’s total profits from the sale of the phones with the infringing design.

Trade Dress: Samsung challenged Apple’s unregistered and registered trade dresses on the ground that they were functional.  Applying the Ninth Circuit’s law on Lanham Act claims, the Federal Circuit agreed that Apple’s asserted trade dresses possessed utilitarian functionality In reaching this conclusion, it placed particular weight on the “product configuration” nature of the trade dress.    “[C]ourts have noted that it is, and should be, more difficult to claim product configuration trade dress than other forms of trade dress.” Slip Op. at 8, quoting Leatherman Tool Grp., Inc. v. Cooper Indus., Inc., 199 F.3d 1009, 1011-12 (9th Cir. 1999).  Here, all factors weighed in favor of the trade dresses being functional and thus unprotectable under trademark law.

Design Patents: A substantial portion of Apple’s billion dollar verdict were based on the infringement of its design patents and  Samsung attacked that issue with an array of arguments.  The Federal Circuit rejected all of them.

Functionality and infringement: Samsung argued that “the district court erred in failing to exclude the functional aspects of the design patents either in the claim construction or elsewhere in the infringement jury instructions.”  Slip Op. at 20.  “For example, Samsung contends that rectangular form and rounded corners are among such elements that should be ignored in the infringement analysis.”  Id.  But, the court held, the precedent cited by Samsung did not support a rule “to eliminate elements from the claim scope of a valid patent in analyzing infringement.”  Id. at 21  Nor did the district court err in its construction of the patent: the principle that “it is the non-functional, design aspects that are pertinent to determinations of infringement” was properly reflected in “the district court’s construction
of the design patents as claiming only ‘the ornamental design’ as shown in the patent figures.”  Id.

Actual deception not required and the role of prior art: In its instruction on infringement, the district court stated: “You do not need, however, to find that any purchasers actually were deceived or confused by the appearance of the accused Samsung products.”  Samsung argued that this instruction misled the jury; the Federal Circuit disagreed. “[T]he jury instruction simply clarified that actual deception was not required, which is an accurate reflection of the analysis in Gorham.”  Id. at 23.  Nor did the jury instructions reduce the consideration of the prior art to a mere option.

Samsung also argued that infringement was not supported by substantial evidence, but its substantive arguments were essentially the same as its challenges to the jury instructions.  The court rejected these and Samsung’s argument that the district court abused its discretion in precluding certain testimony.

Damages: This is the section of the opinion that will probably get the most attention.  The damages statute for design patent infringement, 35 U.S.C. § 289 states:

Whoever during the term of a patent for a design, without license of the owner, (1) applies the patented design, or any colorable imitation thereof, to any article of manufacture for the purpose of sale, or (2) sells or exposes for sale any article of manufacture to which such design or colorable imitation has been applied shall be liable to the owner to the extent of his total profit, but not less than $250, recoverable in any United States district court having jurisdiction of the parties.

Nothing in this section shall prevent, lessen, or impeach any other remedy which an owner of an infringed patent has under the provisions of this title, but he shall not twice recover the profit made from the infringement

In other words, “Section 289 explicitly authorizes the award of total profit from the article of manufacture bearing the patented design.”  Slip Op. at 25 (emphasis added).  That is, Samsung’s total profit from its sales of phones with the infringing designs.

Samsung raised two primary arguments.  First, it argued in favor of apportionment based on a causality theory; that is, that the only profits attributable to the infringement be allowable as damages.  But the statute says “total profit,” and the statutory history contained an express removal of a prior apportionment requirement in the Act of 1887.  Second, Samsung argued that the “article of manufacture” should be limited to the infringing “article of manufacture” and not the entire infringing product.  Again, the Federal Circuit disagreed, distinguishing Samsung’s citation to a 1957 Second Circuit case involving pianos and piano cases.  The Federal Circuit did not substantively engage with the statutory language on this issue.

The bottom line is that high damages claims for design patent infringement are going to be much more credible in the wake of Apple v. Samsung.  Under the court’s ruling, it would seem entirely possible, as a hypothetical example, for an automobile manufacturer to be liable for its entire profits from a particular car model if that model contained, say, an infringing tail light.  Given the publicity surrounding Apple v. Samsung, my expectation is that there will be explosion of design patent assertions and lawsuits.

Utility Patents: Samsung raised an indefiniteness argument based on the claim term “substantially centered;” unsurprisingly, the Federal Circuit rejected it.  There is one interesting little nugget, though: Samsung lost because it “points to no evidence showing that skilled artisans would find the element ‘substantially centered’ as lacking reasonable certainty in its scope.”  Slip Op. at 29.  This language is notable because it reflects the court’s waffling between indefiniteness as an evidentiary question and indefiniteness as question of law.  The former expressly involves testimony about what one of skill in the art would understand; the latter is a question for the court.

Utility Patent Damages: Lost profits for utility patent infringement does require a showing of causality and Samsung argued that there was an acceptable noninfringing substitute.  But “the ‘[m]ere existence of a competing device does not make that device an acceptable substitute.’” Id. at 31, quoting precedent.  All Samsung pointed to was the “mere existence” of a noninfringing phone.  This was not enough, and “there was substantial evidence to support the jury’s refusal to consider the two phones asserted by Samsung as non-infringing substitutes.”  Id. at 32.    The Federal Circuit also rejected Samsung’s challenges to the reasonable royalty award on the set of phones for which Apple was not entitled to lost profits.

Hat tip to Tom Cotter for being the first to alert me to the opinion, which initially appeared only on PACER.  His writeup of the damages discussion:

46 thoughts on “Apple v. Samsung: Design Patents Win

  1. link to

    In a footnote addressed to law professors who filed an amicus brief saying the damages rule “makes no sense in the modern world,” the judges write that those are “policy arguments that should be addressed to Congress.”

    Nice to see the CAFC at least acknowledging the absurdity. Given the extensive commentary here and elsewhere highlighting the tremendous flaws in the US design patent system, it shouldn’t take much pushing to encourage Congress to dump a large bucket of ice water on the damages rule.

    1. Yes Malcolm, those very same “stunning flaws” that you have so ably been able to help Samsung with by your “brilliant legal acumen,” stated without any ad hominem or empty “opinion/policy” hand waving.


  2. Presumably Samsung is going to appeal some or all of this.

    Do any of the design patent “experts” out there have any thoughts as to the chances of success with respect to any of the issues address by the Federal Circuit.

    I’m also curious about the 103 question that Paul Morgan raised (i.e., Was the 103 issue handled below in such a way that it was not even appealable?).

    1. I am sure that Samsung is going to appeal.

      Maybe you can help them out and supply a legal rationale? I would love to see the “B-b-but your honor, they are G-g-grifters” argument you wield soooo successfully here.

      /off sardonic bemusement

      1. Maybe you can help them out and supply a legal rationale?

        Because design patents are all about the ‘legal”.

        Please keep the hits coming, “anon.” The design patent bar needs your cheerleading. After all, an “explosion of design patent assertions and lawsuits” can only mean better designs for everyone, right? Oh yes: and more jobs.

        And anyone who doubts that clearly knows nothing about the law or “ornamentation.” Right?


        1. LOL – hey, if you have no legal arguments to help Samsung out, just say so. No need to go into your usual off-into-the-weeds diatribe with your usual nonsense.

          Or maybe, that is all that you really have.

          1. No need to go into your usual off-into-the-weeds diatribe with your usual nonsense.

            I just asked a question, Billy. You’re the pr*ck who went off into the weeds “with your usual nonsense.” Just read the thread. It’s there for everytone to see.

            Maybe it’s time to get your meds adjusted … again.

            1. Who is Billy?

              And your “just asking a question” was met – fairly – with my “just making a comment.” Unless – as suggested – you really don’t have any “legal arguments” that you can help Samsung with…

              Yes Malcolm, I am inviting you to showcase your legal acumen. And of course, all that you apparently have is, well, the typical vapid ad hominem.

              Go figure.

    2. An appeal? Notwithstanding the recent flurry of Sup. Ct. patent cases, the last I heard the normal odds of a cert petition being granted are less than 1 in 300?
      Since no issue of 103 obviousness of the subject design patents was even raised at the Fed. Cir., and the results of the other issues that were raised on appeal were neither surprising or unexpected, it seems highly likely that this decision will stand. Unless perhaps a long shot legal attack can mounted against the present Fed. Cir. standards for infringement of a design patent, to exclude from jury consideration all functional or prior art elements of design patents drawings? [Which are the design patent’s claims.]
      This may thus become the largest sustained patent infringement damages award since Polaroid v. Eastman Kodak?

      1. Samsung’s petition for rehearing and rehearing en banc will be denied. It’s petition for cert. will be denied. And then they march off to Congress, where the real battleground will be.

  3. Thanks for the link. This doesn’t surprise me – I already knew that “sophisticated” traders use web scraping + NLP (and other even more complex technologies).

    The point I was trying to make was this: the reason sophisticated traders have “time to cash-in on the decision” is not because they have access to PACER while others do not (this is what DC seemed to suggest in his post), but because they have access to sophisticated systems (e.g., web scraping + NLP) that allow them to execute trades based on sensitive news within a matter of seconds, if not milliseconds.

    In other words, the “sophisticated” traders would have had “time to cash-in on the decision” even if the decision had been released simultaneously on PACER and the court’s opinion site.

    1. Genghis,

      There is a clear distinction that you appear to be overlooking: once the information is presented to a “true” public forum, the role of the court is extinguished – but not before. There remains a colorable argument that the court’s (arbitrary) action has violated its duty to avoid the appearance of impropriety (see comments below), in addition to the possibility that the court is in fact aiding and abetting the type of insiders-know-first disparate information access unneccesarily (if indeed the access change creates an actual disparity).

      For argument’s sake, let’s say the new “information release” protocol does favor insiders on a systematic basis. Does not a court have a different ethical standard than other systematic information providers?

      1. I understand the arguments that are being made. However, I don’t know this area of law well enough to form a legal opinion. My comment was about the (mis)use of the term “sophisticated trader” as relating to someone who gets information from PACER instead of from the court’s website.

        It is interesting (or as I’m sure some on this message board will say ironical) to note that PACER stands for “Public Access to Court Electronic Records.”

  4. Re the above assertion that: “Under the court’s ruling, it would seem entirely possible, as a hypothetical example, for an automobile manufacturer to be liable for its entire profits from a particular car model if that model contained, say, an infringing tail light. ”
    That is missing a distinction provided in this decision itself. Namely that: “The innards of Samsung’s smartphones were not sold separately from their shells as distinct articles of manufacture to ordinary purchasers” [as are car tail lights].

    This is not to defend the strange effect of the special damages statute for design patents in many potential situations. But it is not ambiguous, and thus hardly surprising that academic amici here were not going to get a court, rather than Congress, to rewrite it.

    But what I found even stranger was the defendant’s pursuit of a clearly losing patent law argument that purchasers of a design patent infringer’s products must be actually deceived or confused. [Confusing patent law with trademark law.]

    1. BTW, what I found surprising in this decision was a complete absence of any consideration of invalidity under 35 USC 103 of any of the subject design patents? That had seemed like a highly relevant issue to many interested observers of the trial below. It would also seem easier to challenge on appeal than design patent non-infringement, given the the Fed. Cir. test for the latter? Was the 103 issue handled below in such a way that it was not even appealable?

    2. You’re right that car tail lights are arguably a more borderline example then the smartphone shell, since there are aftermarket modifications that one can purchase for cars (and entire communities dedicated to modding their cars). That said, most (if not all) new cars are sold with the factory taillights and my intuition is that most consumers think the same way about their car’s taillights as they do about their smartphone shell. So I’m not convinced that just because something is modifiable doesn’t put it outside of this language. And even if that’s the case with cars, there are lots of other products where no one’s going to sell the component separately from the rest of the product. You could make my hypothetical less borderline if it were the tail light of a forklift or backhoe.

      (Actually, the more I think about it the more I’m not so sure that cars are any more moddable than a Samsung phone, especially since there are entire communities built up around modding smartphones…)

  5. my expectation is that there will be explosion of design patent assertions and lawsuits.

    …not to mention the explosion of “grifter” comments pertaining to the (as written by Congress) law and the “worthlessness” of (any) design patent, because, you know, such are only the “t001” of the proletariat, er um, despised persons…

    Or something.

    1. “Given the publicity surrounding Apple v. Samsung, my expectation is that there will be explosion of design patent assertions and lawsuits.” And pressure brought to bear on Congress to change the law so that damages for design infringement are in line with damages for infringement of real patents.

      1. No doubt Johny.

        But in case you haven’t noticed, there already is lots of pressure. Look but to the AIA and its results: the patent system is now slower, more costly, and even if you obtain a patent, the rights are far more uncertain.

        Exactly like the Big Corp (among other anti-patent forces, each with their distinct reasons) pressures wanted.

      2. Mr. Hooker,
        Get real, like design patents.
        Knockoffs, against which design patents are most effective, do not hide inside their shells like your so-called “real” patents. Total profit awards are needed to discourage knock-offs that appropriate the actual face of a company – its designs. If all a design infringer had to do was pay a 5% royalty to the design patent owner – well, they would simply chalk it up as a cost of doing business, and copy again, and again, and again. Utility patent damages are properly limited because you most frequently can’t see the technology being appropriated – so there’s no theft of the very identity of the company. Besides, no one rants and raves about trademark/trade dress/copyright damages, all of which allow recovery of an infringer’s profits.
        I think Samsung, and companies like it, will now steer clear of stealing others’ original product designs (which was clearly proven to be the case for the iPhone and iPad), and start designing their own stuff, which is good.

  6. OT of the Design Patent issue, but this is another example of the Federal Circuit creating problems with its publication policy. Here, the opinion became available on PACER for more than an hour before it was posted to the court’s opinion site. This quasi-secrecy basically gave sophisticated stock traders time to cash-in on the decision.

    1. Glad you recognize the problem with the stock market.

      Now we have to deal with those pesky short sellers that sell short, then file IPRs against small company patents and collect the profits after the IPR is announced.

      Ditto blackmailers who threaten to file IPRs unless they get their way.

    2. Could not an argument be made that normal insider trading rules apply – after all, the court decision, even though announced to the parties is not yet public information until it is, well, public, right?

      1. So your argument would be that information on a system titled “Public Access to Court Electronic Records” is not public information? Good luck with that!

        1. I think it’s a quite reasonable argument to say that paywalled access is not equivalent to public access. Imagine if a publicly traded corporation decided to charge for access to their quarterly earnings reports and conference call during the first 24 hours after release. Do you think the SEC would agree that that qualifies as public access?

          1. I see your argument, but many facets of stock trading comprise of information that isn’t “free.”

            Even quotes.

            Joe public doesn’t have free access to generated stock quotes in real time… The quotes joe public gets are intentionally delayed (15 or 20 minutes if I remember correctly) and the real info is behind a pay wall. A substantial pay wall.

            A 15 or 20 minute delay is an immeasurable disadvantage. Somewhat akin to showing up to a gun fight, not only without a gun, but also blind and armless; or batting in a major league baseball game facing away from the pitchers mound, blindfolded with a toothpick.

            If that flies, I don’t see how PACER would not.

        2. Not so much on a “per se” basis – more so merely on the timing aspects. If the court has acted in a way that their “public” is not in fact truly public, then such action has easily foreseeable consequences (or at least, as I am supposing, such could be a colorable argument).

        3. The court had previously provided immediate access to opinions at a scheduled time via the open website. Although PACER is public, the posting of opinions with somewhat random timing creates a lack of transparency that facilitates arbitrage.

          1. Although PACER is public, the posting of opinions with somewhat random timing creates a lack of transparency that facilitates arbitrage.

            Not under any definition of “arbitrage” that I’m familiar with.

            I think this whole discussion is a little bit silly. Lots of events involving publicly traded companies happen at random times. Some people learn about them later than other people, sometimes systematically so. As long as court personnel aren’t tipping off their friends, nobody has any unusual advantage over anyone else

            1. I also think it’s silly. As long as “insiders” are not placing trades based on this info, I don’t see what the problem is.

              I do think one could argue that PACER is not public. I don’t have access to it, for instance.

              1. My comments are more theoretical in nature (I am not taking that side in an argument – merely pointing out that a colorable argument may be present).

                In fact PatentBob, as this came up previously, you can choose to have access to PACER, and if your selections are minimal, the service is in fact effectively free.

                I would be interested in seeing some of these systemically insider-biased systems hinted at though…

                1. I didn’t say anything about systematically insider-biased systems, I said that some people systematically learn information about publicly-traded companies before others. Here’s one of the technologies involved:

                  link to

                  To the topic at hand, there seems to be some concern that subscribers to PACER have access to key information some hours before normal readers of the Federal Circuit website, and therefore can take advantage of those normal readers during that entire period. The fact is, it just doesn’t work that way. As the link above demonstrates, the guys who do this for a living* incorporate new information into the stock price so quickly that the little guy can just assume that it’s instantaneous. The whole notion that the retail investor can make shrewd trades based on real-time information is just wrong.

                  * or the insiders, in some cases. It’s worth noting that while insider trading strikes almost everyone as grossly unfair, there are quite reasonable arguments that the bans against insider trading are counterproductive. Here’s an example:
                  link to

                  I’m no objectivist, but I think that’s pretty much right. The money quote: “Bans [on insider trading] instead encourage people to engage in st*pid behavior by creating the appearance – but not the reality – that everyone has access to the same information.”

      2. Sure, you could argue that. But the insider trading rules only apply to those individuals who have a duty of trust with respect to the company, and those individuals to whom such a duty can be imputed (e.g., because of a “tip” from someone who has such a duty). If some unrelated person learns about a court decision from PACER, he’s not an insider. So, if we decided that PACER information was non-public, you’d have an interesting situation where everyone except insiders could trade on the information.

        1. This goes to the lack of notice that “the rest of us” don’t have for that limited time.

          It is during that initial time that only the “insiders” know what has transpired, eh?

          1. Sorry, I don’t understand your comment.

            Your original comment referred to “normal insider trading rules.” Under those normal insider trading rules, subscribers to PACER are not “insiders.”

            1. Under the previous way PACER and court opinion announcements were made, sure.

              But under the new way…? (At least there may be a colorable argument not so, eh?)

        2. We don’t have to go as far as SEC rules to argue that the court should change its behavior. The court should always avoid the mere appearance of impropriety, and most judges and Justices go out of their way to recuse themselves when even tangential contact with a party is present or even just perceived to be present. In my opinion, this obliges the court not to put this kind of information behind a paywall in this fashion, because it appears that the court is selling early access to valuable, actionable information.

          1. “The court should always avoid the mere appearance of impropriety, and most judges and Justices go out of their way to recuse themselves when even tangential contact with a party is present or even just perceived to be present.”

            *cough* *cough* Rader?

            Still waiting on those sealed documents under protective order that were forwarded to the cali bar to be unsealed. But we all know that isn’t going to happen.

            This is a situation where the FBI needs to get involved.

    3. DC said: This quasi-secrecy basically gave sophisticated stock traders time to cash-in on the decision.

      I wouldn’t call that “sophisticated.” To me “sophisticated” means something that is “non-obvious” or that requires a lot of time and/or resources (e.g., implementing a complex trading algorithm). Checking PACER (and other well known and legitimate information sources) seems like an obvious thing to do if you want to trade based on a court decision.

      Are you suggesting that one can monetize the information gap between the time a decision becomes available on PACER vs. the time the decision becomes available on the court’s opinion site? I’ll be shocked if it was that easy…

Comments are closed.