Tag Archives: design patent

Utility and Design Patents – Up Again for 2017

Patent

After a couple of years of stagnant growth, the USPTO has issued record numbers of both utility and design patents in 2017. (Charts below).  The number of new utility applications is down over the past couple of years (excluding continuations and CIPs).  Rather than being due to more inflow, the rise in issuance can be explained primarily by an increased issuance rate as well as efforts to reduce “rework.”

Question in my mind: Are applicants filing measurably better patent applications now than they were 10 years ago?

UtilityPatents2017

DesignPats2017

Impact of the 15-year Design Patent Term

Patent

If I were preparing to file a design patent around early May 2015, I might have held-off a bit on the filing to pass the May 13, 2015 threshold.  Design patents stemming from applications filed on or after that date have a 15-year patent term (calculated from patent issuance) as opposed to a 14-year term for those filed prior to the threshold date.

When I looked at the numbers, I was surprised to find that the extra year did not capture the hearts of design patent filers as I might have expected. (See Chart below.) Yes, filings on the 13th of May were above average and the preceding two days were below average, but the first look here that few filers acted to game that extra year.

DesignPatents15Year

 

 

 

First Post-Samsung Design Patent Damages Verdict

Patent

by Dennis Crouch

HeatReflectives

Don’t stare too deeply into the pattern above – it embodies Columbia Sportswear’s U.S. Design Patent No. D657093 – covering “the ornamental design of a heat reflective material, as shown and described.”  The recent $3 million jury verdict in Columbia Sportsware v. Seirus Innovative Accessories appears to be the first post-Samsung verdict on design patent damages.

DesignPatentDamages

The design patent damages verdict here is important for Columbia because the jury found the parallel asserted utility patent claims invalid as both obvious and anticipated. [ColumbiaSportsVerdict]

If you remember, the Patent Act includes a special profit-disgorgement provision for design infringement damages requiring that “Whoever during the term of a patent for a design … 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.” 35 U.S.C. 289.

InfringingDesign

In the case, the district court had already ruled on summary judgment that Seirus infringed and so the only question for the jury was damages.  [Columbia Infringement Decision, holding that as a matter of law “an ordinary observer familiar with the prior art would be likely to confuse Seirus’s design with Columbia’s patented design.”]

In Samsung, the Supreme Court held that, the relevant article of manufacture used as the profit-disgorgement baseline need not be the end product sold to the consumer but might be only a component of that product.  As the patent images show below, the case here involves multi-component parts (clothing) and the patented inner-layer can be seen as one of the components.

Here, in Columbia Sportswear, the court instructed the jury to “First, identify the article of manufacture’ to which the infringed design has been applied. The article of manufacture may be the product as a whole or a component of that product. Second, calculate the infringer’s total profit made on that article of manufacture.”  The jury instructions then explain this process as (1) first identifying whether the accused-product being sold is multi-component and then, if so, (2) considering a set of factors to determine whether the “article of manufacture” is the whole product or some sub-component.  These factors include: the scope of the design as patented; the relative prominence of the design within the product as a whole; whether the design is conceptually distinct from the product as a whole; and the physical relationship between the patented design and the rest of the product.  These factors match the test called-for in the Government brief in Samsung v. Apple, but that the Supreme Court declined to expressly articulate.

The jury instructions also explain the burdens:

Columbia [the patentee] bears the initial burden of producing evidence identifying the article of manufacture for which it seeks profits. Columbia may meet that burden by showing that Seirus applied the patented design to a product that was sold and further proving Seirus’s total profit from the sale. Seirus bears the burden of proving that the article of manufacture is something less than the entire product.

A snippet from the jury award is included above. You’ll note that the jury was not asked to actually define the article of manufacture, but the $3 million figure appears to be Seirus’s profits on all of its infringing sales.

At this point, it looks like both parties will appeal various aspects of the decision (after first filing post-verdict motions with the district court).  Going back to Apple v. Samsung the case has been remanded back to Judge Koh who is considering party briefs on the article-of-manufacture issue and consequently. [AppleBrief][SamsungBrief]

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In a bit of wild civil procedure, the lawsuit here was originally filed in Oregon but jumped down to Southern California on September 1, 2017 — less than three weeks before the trial.  The transfer was deemed appropriate under the TC Heartland case.  The trick is that Oregon Judge Hernandez also had himself temporarily transferred to the S.D. Cal. so that he could continue hearing the case.

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HeatReflective

Apple Samsung: Federal Circuit Remands Design Patent Damages Decision to District Court

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iphonedesignpatentimageBy Dennis Crouch

Apple v. Samsung (Fed. Cir. 2017)

In a non-precedential decision, the Federal Circuit has remanded this design patent damages dispute back to the district court reconsideration.  The basic question is whether the patented “article of manufacture” (which serves as the basis for profit disgorgment) should be the entire article sold to consumers or some component of that whole.  A patentee would obviously prefer the whole-article basis because it would result in a greater total-profit award. In Samsung Elecs. Co. v. Apple Inc., 137 S. Ct. 429 (2016), the Supreme Court held that the statute is broad enough to encompass either the entire-article or simply a component.  However, the Court refused to provide any guidance as to how to determine the appropriate basis in any particular case (including this case involving Apple’s iPhone design patents).

On remand here, the Federal Circuit has also refused to particularly decide the case but instead has remanded to the District Court for her analysis.  “[W]e remand this case to the district court for further proceedings, which may or may not include a new damages trial.”

The court did provide some commentary:

The Supreme Court clarified that a damages award under § 289 involves two steps: (1) “identify the ‘article of manufacture’ to which the infringed design has been applied;” and (2) “calculate the infringer’s total profit made on that article of manufacture.”

The parties here dispute whether the jury instructions were appropriate based upon this clarification of the law.   Apparently, Judge Koh read the statute to the jury, and did not particularly indicate whether the “article of manufacture” was the phone as a whole or some component thereof.  So, while the instructions are not wrong, they could be more detailed.

On remand, the District Court will need to review the trial record and determine whether a new damages trial is necessary based upon more detailed jury instructions.

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I like what the court did here.  When the Federal Circuit does decide this issue, its precedential approach is likely to stick for many years to come.  It makes sense then for the court to seek the perspective of at least one other judge before jumping into the foray.  Here, there is no question that the district court more fully understands the case and the particulars of the trial and so it is also right to remand for consideration of how the Supreme Court’s decision impacts what has already been decided. We can also recognize that the parties are fighting over past damages and both have sufficient cash-on-hand so that a delay in judgment does not create irreparable harm.

= = = = =

In a Footnote, the court looked to foreclose a separate argument on remand. The court writes:

Samsung also argued that § 289 “contains a causation requirement, which limits a § 289 damages award to the total profit the infringer made because of the infringement.” We rejected that argument, and Samsung abandoned this theory during oral argument to the Supreme Court.

Thus, although causation may still be an issue to be debated – it appears out for this case.

Samsung v. Apple: Design Patent Damages May be Limited to Components

Patent,

by Dennis Crouch

Samsung v. Apple (Supreme Court 2016)

In a unanimous opinion authored by Justice Sotomayor, the Supreme Court has reversed the Federal Circuit in this important design patent damages case.  Although the case offers hope for Samsung and others adjudged of infringing design patents, it offers no clarity as to the rule of law.

The decision centers on the special statutory provision for damage awards in design patents – 35 U.S.C. § 289.  Section 289 provides for the significant remedy of profit disgorgement based upon a defendant’s use of the patented “article of manufacture.” The infringer “shall be liable to the owner to the extent of his total profit.”

The challenge in Samsung v. Apple is whether to calculate the award based upon Samsung’s profits for its smartphone devices as a whole or instead whether profits could be narrowed to profits associated with individual components (such as the screen or phone body shape) even though those components are not sold directly to the consumers.

Siding with the infringer Samsung, the court held that the statute allows for damages to be applied at the component level since components are also “articles of manufacture.” The court also indicated that the product as a whole is also an article of manufacture.

[T]he term “article of manufacture” is broad enough to embrace both a product sold to a consumer and a component of that product, whether sold separately or not. Thus, reading “article of manufacture” in §289 to cover only an end product sold to a consumer gives too narrow a meaning to the phrase.

Thus, it will be up to courts to figure out which to level applies in particular cases.

No Test: Here, the court refused to offer any opinion as as to (1) how a judge or jury might go about deciding whether the profits apply to the product as a whole or instead to an individual component or (2) whether – in this case – the profits should be applied to the entire Samsung Galaxy smartphones or only to the individual components.  The problem, according to the Court, was inadequate briefing. “We decline to lay out a test for the first step of the §289 damages inquiry in the absence of adequate briefing by the parties.”  On remand, the Federal Circuit may grapple with these issues — what is the best test?

Defining Article of Manufacture:  In the decision, the court offered what it termed a “broad” meaning of “article of manufacture” as “a thing made by hand or machine.”  Although broad, the definition appears to exclude digital and virtual designs.   I query here whether Apple’s patented “graphical user interface for a display screen” at issue in this case fits this definition. USD0604305Sale of an Article of Manufacture: One problem with the decision is how it intermingles Section 171 with Section 289.  Section 171 can be thought of as the 101-of-design-patents and allows for the patenting of “any new, original and ornamental design for an article of manufacture.” Once issued, the design patent may be asserted either under the general patent statutes Section 271/284 (infringement/damages) or else under the alternative design patent alternative codified in Section 289.  The statute expressly allows for either option, but forbids double-collection of damages.  The distinction: Although Section 171 may well allow for patenting of a component or portion of a device (see below), it does not necessarily follow that an infringement action would lie in Section 289 for such a component – since that section requires a sale of the patented article of manufacture.   Perhaps all of this will be baked into the Federal Circuit test.

Component-Based Design Patents: Of some interest, the Court accepts as a given that design patents may properly cover a component of a multi-component invention. In the process, it affirmatively cites Judge Rich’s 1980 Zahn decision that allows for design patents covering partial components even when non-discrete or incomplete. Application of Zahn, 617 F. 2d 261 (CCPA 1980) (“Section 171 authorizes patents on ornamental designs for articles of manufacture. While the design must be embodied in some articles, the statute is not limited to designs for complete articles, or ‘discrete’ articles, and certainly not to articles separately sold . . . ”).  This goes beyond the also-cited old case of Ex parte Adams, 84 Off. Gaz. Pat. Office 311 (1898) (design patents allowed on movable/separable components).

Read the short decision: SamsungAppleDecision.

Digital Trademark and Design Patent Infringement

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Guest post by Lucas S. Osborn, Associate Professor of Law at Campbell University School of Law. He will be visiting at Denver University School of Law for 2016-17.

Digital technology continues its collision with intellectual property law, this time in BMW’s lawsuit against the online virtual modeling company TurboSquid. TurboSquid sells digital 3D models of various items for use by game developers, architects, visual effects studios, etc.

This case is paradigmatic of a project Mark McKenna and I are working on, which analyzes trademarks in the context of digital goods. BMW complains that TurboSquid’s “marketing of 3-D virtual models” of BMW vehicles infringes BMW’s trademarks, trade dress, and design patents. Specifically, it complains that TurboSquid “markets and tags BMW-trademarked 3-D virtual models of BMW vehicles as suitable for games.”

Interestingly, although some of BMW’s registrations cover “miniature toy vehicles,” “interactive game programs,” and “scale model vehicles,” none of the registrations covers virtual models of vehicles. BMW also alleges that it “licenses its trademarks and patented designs for use in 3-D virtual models for computer games.”

BMW’s claims of infringement raise conceptual difficulties. Does selling a virtual object directly infringe a trademark or design patent that contemplates, or is in fact limited to, a physical good?

In thinking about trademark infringement, the core analysis focuses on whether the digital file is a good about which there is confusion as to source, sponsorship, or the like.  Confusion might arise from at least three mechanisms. First, TurboSquid might create a website environment that looks as if it is a BMW-sanctioned website, such as by using a domain name like BMW.net or by designing the webpage to suggest that it is affiliated with BMW. The TurboSquid website does not do this.

Second, TurboSquid might cause confusion through the external labels attached to each file. If the file name/description read, “BMW authorized model of BMW X3,”  TurboSquid would falsely suggest an affiliation or source. But its external file labels read simply, “BMW X3” and the like. BMW will doubtless argue that this external file labeling provides an indication of source or affiliation, but is this so? Arguably the external description is nominative or descriptive because it merely describes what the file is, i.e., a model of a BMW car. Of course, TurboSquid could change all the external file descriptions to eliminate the potential confusion (i.e., “unauthorized model of BMW X3”), but courts should balance the burden on TurboSquid and the effects on user search costs against any evidence of the extent of actual or potential confusion.

Deciding whether the external file description creates confusion or instead is nominative bleeds into the third potential argument for confusion, which is that the content of the digital file itself causes the confusion. That is, BMW will argue that since the content of the digital file displays a BMW logo on the car, the purchaser will be confused as to source or sponsorship. The Supreme Court, however, seemingly foreclosed this argument in Dastar Corp. v. Twentieth Century Fox Film Corp., 539 U.S. 23 (2003). Dastar directs that a court should not use the content of the digital file to inform the confusion analysis.

Dastar copied footage from Fox’s Crusade in Europe television series and reused portions of that footage in its own videos without attribution to Fox. Id. at 26-27. Fox alleged Dastar committed reverse passing off in violation of § 43(a) of the Lanham Act by representing Fox’s content as its own. Id. at 27. The Supreme Court rejected Dastar’s claim, holding that “origin of goods” refers only to the “producer of the tangible goods that are offered for sale, and not to the author of any idea, concept, or communication embodied in those goods. Id. at 37.

The Court was concerned that allowing claims for reverse passing off in the context of copyrightable works “would create a species of mutant copyright law” that would conflict with the Federal copyright regime. Id. at 34. Dastar’s concern about conflicts between copyright and trademark law channels courts away from finding confusion based on the content of expressive works. See generally Mark P. McKenna, Dastar’s Next Stand, 19 J. Intell. Prop. L. 357 (2012). Thus, the content of TurboSquid’s files cannot form the basis of the confusion. The content of the files is protected, if at all, by some other form of intellectual property law, such as copyright.

Even assuming there is no point-of-sale confusion with the purchase of the digital file, TurboSquid cannot drive away freely just yet; it must contend with post-sale confusion. Post-sale confusion protects trademark owners when there is no point-of-sale confusion because the purchaser of the good knows it is fake. Courts have found that confusion can arise after a sale when the individual wears the infringing good in public, causing observers to see the branded item and become confused about whether it is genuine or not.

TurboSquid’s purchasers obviously will not wear the digital files in public. Nevertheless, they will use the files in downstream productions such as video games, and thus BMW also alleged there will be post-sale confusion. However, use of the models in expressive works like games and other video productions will not likely lead to an actionable trademark claim because the First Amendment protections provided to expressive works would likely trump any trademark claim.  See, e.g., Rogers v. Grimaldi, 875 F.2d 994 (2d Cir. 1989); E.S.S. Entm’t 2000, Inc. v. Rock Star Videos, Inc., 547 F.3d 1095 (9th Cir. 2008). Moreover, once again Dastar suggests that any potential confusion generated from the content of the video game or other expressive work is irrelevant under the Lanham Act.

Trademark law arose in a world of physical goods to protect manufacturers and prevent consumer confusion as to who manufactured the goods. In a digital world, manufacturing will increasingly be done, if at all, by individuals with 3D printers. Other digital models, such as TurboSquid’s BMW models, will never exist as physical objects.  Where consumers care about the quality of a digital file, trademark law can protect consumers from being deceived by indicia external to the file. But if purchasers are not confused about the source of the digital file based on external indicia, courts should channel any other potential claims (if any) to other areas of intellectual property law.

Design Patent Damages at the Supreme Court

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by Dennis Crouch

Samsung has filed its opening merits briefs in its design patent damages appeal Samsung v. Apple.  The central issue in the case is the proper statutory interpretation of the design patent damages statute 35 U.S.C. 289 that offers an alternative calculation for damages:

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.

The question for the court is “total profit” from what? Is it the sale of the article-of-manufacture (here, the Galaxy phones) or merely the particular component.  For this case, the particular components would be the front face of the phone and the icon-grid displayed on a user interface screen.  Samsung asks: Where a design patent is applied to only a component of a product, should an award of infringer’s profits be limited to those profits attributable to the component? [Samsung Opening Brief – US Supreme Court]

In a statement to Patently-O, Samsung argued that “If the current ruling is left to stand, it would value a single design patent over the hundreds of thousands of groundbreaking technology patents, leading to vastly overvalued design patents.”  The itself brief cites Professor Rantanen’s 2015 essay for the proposition that the high damage is likely result in an “explosion of design patent assertions and lawsuits.”

The design-patent-damages statute was originally enacted in 1887 as a reaction to the last Supreme Court design patent damages cases that limited lost profit awards. Dobson v. Hartford Carpet Co., 114 U.S. 439 (1885); and Dobson v. Dornan, 118 U.S. 10 (1886).  However, Samsung argues that the 1952 amendments are important here.

Design Patent Claim Construction: More from the Federal Circuit

Patent,

Guest post by Sarah Burstein, Associate Professor of Law at the University of Oklahoma College of Law.

Sport Dimension, Inc. v. Coleman Co., Inc. (Fed. Cir. April 19, 2016) Download Opinion

Panel: Moore, Hughes, Stoll (author)

Coleman accused Sport Dimension of infringing U.S. Patent No. D623,714 (the “D’714 patent”), which claims the following design for a “Personal Flotation Device”:

Coleman1

The district court construed the claim as: “The ornamental design for a personal flotation device, as shown and described in Figures 1–8, except the left and right armband, and the side torso tapering, which are functional and not ornamental.” The court, like many other courts and a number of commentators, interpreted the Federal Circuit’s 2010 decision in Richardson v. Stanley Works as requiring courts to “factor out” functional parts of claimed designs. Coleman moved for entry of judgment of noninfringement and appealed the claim construction (along with another issue not relevant to this discussion).

After Coleman’s appeal was docketed, the Federal Circuit disavowed the “factoring out” rule that many had read in Richardson. As discussed previously on this blog, in Apple v. Samsung and again in Ethicon v. Covidien, the court insisted that Richardson did not, in fact, require the elimination of functional elements from design patent claims.

Following this new interpretation of Richardson, the Federal Circuit reversed the district court’s construction of Coleman’s claim. The court stated, for the third time in a year, that district courts should not eliminate portions of claimed designs during claim construction. So it seems that the Federal Circuit’s retreat from Richardson is complete—if that weren’t clear already.

And, for the first time I’m aware of, the court actually explained how it determined whether something is “functional” for the purposes of claim construction. It’s been clear for a while that the court was using a more expansive concept of “functionality” in the context of claim construction than it was using for validity. (For more on this issue, see this recent LANDSLIDE article by Chris Carani.) However, the court hasn’t seemed to acknowledge that disconnect or explain how courts should analyze functionality in the claim construction context. In this case, the court did both. The Federal Circuit stated that the Berry Sterling factors, although “introduced…to assist courts in determining whether a claimed design was dictated by function and thus invalid, may serve as a useful guide for claim construction functionality as well.” (Those factors, discussed here, are very similar to the factors used by courts to determine whether a design is invalid as functional in the trademark context. For more on the trademark test and how it differs from the current design patent test for validity, see here.) Applying the Berry Sterling factors to the facts of this case, the court affirmed the district court’s conclusion that the armbands and tapering were functional.

So in Sport Dimension, it is clear that the Federal Circuit thinks it is important to determine whether an “element” or “aspect” (the court uses those words as synonyms) of a design is functional. And it is very clear that courts are not supposed to completely remove functional “elements” or “aspects” from design patent claims as a part of claim construction. But what are courts supposed to do? Here is what the court said:

We thus look to the overall design of Coleman’s personal flotation device disclosed in the D’714 patent to determine the proper claim construction. The design includes the appearance of three interconnected rectangles, as seen in Figure 2. It is minimalist, with little ornamentation. And the design includes the shape of the armbands and side torso tapering, to the extent that they contribute to the overall ornamentation of the design. As we discussed above, however, the armbands and side torso tapering serve a functional purpose, so the fact finder should not focus on the particular designs of these elements when determining infringement, but rather focus on what these elements contribute to the design’s overall ornamentation.

It’s not at all clear what the court is trying to say here, especially in the highlighted portion (emphasis mine). It seems that perhaps the court is trying to say that, in analyzing infringement, the factfinder should focus on the overall appearance of the claimed design. But if that is what the court meant, then this “claim construction” frolic adds nothing—the infringement test already requires the factfinder to look at the actual claimed design, as opposed to the general design concept.

This portion of the decision also seems to be in some conflict with the court’s decision in Ethicon. In Ethicon, as here, the district court eliminated all the functional portions of the claimed design. Unlike this case, the district court in Ethicon said that all the elements were functional and, thus, the claim had no scope. The Federal Circuit reversed, stating:

[A]lthough the Design Patents do not protect the general design concept of an open trigger, torque knob, and activation button in a particular configuration, they nevertheless have some scope—the particular ornamental designs of those underlying elements.

So Ethicon says that factfinders must look at the “particular ornamental designs” of functional elements. Sport Dimension says they “should not focus on the particular designs of [functional] elements.” These statements could potentially be reconciled by drawing a distinction between the “particular design” of an element/feature and the “particular ornamental design.” But it’s not at all clear what that distinction might be—or whether it makes sense to draw such a distinction at all.

More importantly, it’s not clear what, exactly, the Federal Circuit hopes to gain by making district courts go through this rigmarole. In this case, the accused product looks nothing like the claimed design, as can be seen from these representative images:

Claimed Design

Claimed Design

Accused Product

Accused Product

Yes, they both have armbands with somewhat similar shapes and some tapering at the torso. But the overall composition of design elements is strikingly different. You don’t need to “factor out” anything or “narrow” the claim to reach the conclusion that these designs are plainly dissimilar. (The same was true, by the way, of the facts in Richardson.) Even for designs that are not plainly dissimilar, the Egyptian Goddess test for infringement should serve to narrow claims appropriately where elements are truly functional because one would expect those elements to appear in the prior art. So once again, one is forced to ask what the Federal Circuit is trying to accomplish with these “claim construction functionality” rules—and whether the game is worth the candle.

Design Patentees

Patent

Design patents continue to be a popular protection scheme for developers of consumer products and screen displays. Top ten assignees thus-far in 2016 with most recent examples:

  1. Samsung (Toner Cartridge)  [Samsung has 4x more design patents than any other assignee on the list]
  2. LGE (Mobile telephone)
  3. Apple (Mobile telephone)
  4. Microsoft (Icon)
  5. Ford (Truck Grille)
  6. Google (Screen display for Maps)
  7. Nike (Tights)
  8. Jaguar & Land Rover (Rims)
  9. 3M (clip)
  10. P&G (sanitary napkin)
  11. Tencent (screen display)

Supreme Court Grants Cert on Design Patent Damages

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By Jason Rantanen

This morning, the Supreme Court granted certiorari on the design patent remedies question in Samsung Electronics Co. v. Apple Inc.  It did not grant certiorari on the functionality/ornamentality question raised in Samsung’s petition.

The question presented is:

2. Where a design patent is applied to only a component of a product, should an award of infringer’s profits be limited to those profits attributable to the component?

Prior PatentlyO discussion available here.  Tom Cotter also has an extensive discussion of this case on his Comparative Patent Remedies blog.

This case is particularly interesting to me, as this afternoon I’m giving a talk at the Washington & Lee School of Law on a current work in progress on the Takings Clause and changes to substantive patent law.  I’ll be touching on the design patent remedies issue as an area of potential tension–regardless of how this decision turns out, it will be an imporant subject to keep an eye on!

Samsung v. Apple: Functional Design Patents and Profit Disgorgement

Patent,

by Dennis Crouch

Six amici briefs have now been filed in support of Samsung’s petition for writ of certiorari in its design patent defense against Apple.  

Law Professor Brief: [SamsungLemley] In a petition primarily drafted by Professors Mark Lemley and Mark McKenna, and filed by Lemley, a group of 37 law professors strongly support Samsung’s position that design patent rights should be severely limited. The brief first looks at design patent scope and argues that design patent rights should only be permitted to cover non-functional and ornamental aspects of a product.  “Crucially, design patents protect only ornamentation. They may not cover the functional aspects of a product.”  As I and others have written, the functionality limitation in design patents is much weaker than that of trademark and copyright law.  The brief argues, however, that those regimes should be squared so that utility patent remain the sole domain of for the protection of functional design elements.  “Giving a design patent owner control over utilitarian features undermines the policy goals of the [trademark] functionality doctrine.”

Regarding damages, the brief argues that entire-profit-disgorgement for design patent infringement “makes no sense in the modern world”,  leads to “absurd results”, is “draconian”, and is not required by the statute.   Remember, the idea here is that Apple is collecting all of Samsung’s profits on its infringing Galaxy phones even though only some of the components of the devices infringe.

Public Knowledge and the Electronic Frontier Foundation: [SamsungPKEFF] PK and the EFF argue that we are likely to move into a world of design-patent-trolls filled with “abusive [design] patent litigation.”  PK also suggest a constitutional crisis – that these high damage awards for design patent infringement may violate the Fifth and Fourteenth Amendments (due process).   For part of their argument, the groups quote my 2010 design patent article where I wrote that  “design patent prosecution is a relatively quick, inexpensive, and assured process without substantive examination as compared with either utility patent prosecution or trade
dress registration.”  From my analysis, they reached the conclusion that “the low-quality patent concerns common with abusive utility patent litigation are even more so present with design patents.”

CCIA: [SamsungCCIA]  Although less-so than PK and EFF, the CCIA is fairly consistent in arguing for narrower patent rights.  Here, the organization makes the argument that entire-profit-disgorgement raises constitutional questions by going beyond the “exclusive Right to their respective … Discoveries.”

Systems, Inc: [SamsungSystems] Longtime patent litigator Philip Mann filed a brief on behalf of Systems who is litigating design patent damages issues.  The brief outlines several examples of how the profit disgorgement rule is having a “very real and accelerating” negative impact on  the business community. The brief cites its own case of Nordock v. Systems as well as Pacific Coast Marine Windshields v. Malibu Boats and Microsoft v. Corel.

Tech Companies: [SamsungTech] A group of oft-patent-defendants, including eBay, Dell, Facebook, Google, HP, and NewEgg joined together in a brief arguing for a narrowed interpretation of ‘article of manufacture’ from Section 289 rather than focusing on the entire retail product.

Marginalized Americans: [SamsungHLF] A set of groups that self-identify as “communities that are marginalized in American society” have filed a brief arguing that these strong design patent rights threaten to raise retail prices and limit access to affordable new technology, including smartphones and internet access.

Apple, Samsung & Design Patent Claim Construction

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By Sarah Burstein, Associate Professor of Law at the University of Oklahoma College of Law

Samsung Electronics Co., Ltd. v. Apple Inc. (on petition for a writ of certiorari)

In its recently-filed cert petition, Samsung makes some particularly interesting arguments about design patent claim construction. Specifically, Samsung argues “that district courts have a duty to construe [design] patent claims and eliminate unprotected features” under Markman and that the Federal Circuit has erred in “allow[ing] district courts . . . to decline to provide any meaningful claim construction.” To put these arguments in context, a bit of background is in order.

Twenty years ago, the Federal Circuit held that Markman applies to design patents. Since then, it has struggled to decide and describe how, exactly, it applies in the design context. This difficulty isn’t particularly surprising. Markman (and later Supreme Court cases about claim construction) only dealt with utility patent claims. And utility patent claims are fundamentally different from design patent claims. Unlike utility patents, design patents can contain only one claim. The verbal portion of this claim must (in general) read as follows: “The ornamental design for [the article which embodies the design or to which it is applied] as shown.” The phrase “as shown” refers to the drawings or photographs submitted by the applicant. Therefore, design patent claims consist mainly of images, not words.

The Federal revisited the issue of Markman and design patents in 2007. When it granted en banc review in Egyptian Goddess, the court asked for briefing on the issue of whether claim construction should apply to design patents and, if so, what role that construction should play in the infringement analysis. The court received numerous amicus briefs on this issue, expressing a wide range of opinions. When the court issued its decision in 2008, it ruled that district courts do not have to—and ordinarily, should not—construe a design patent claim by providing a detailed verbal description of the design. It suggested that district courts could, nonetheless, “usefully guide the finder of fact by addressing a number of other issues that bear on the scope of the claim” by, for example, describing any relevant drawing conventions, describing the effect of any relevant matters in the prosecution history, and “distinguishing between those features of the claimed design that are ornamental and those that are purely functional.”

Then, in its 2010 decision in Richardson, the Federal Circuit indicated that district courts should “factor out” functional elements in construing design patent claims. This “factoring out” approach proved to be both unworkable and unnecessary, as Chris Carani explained in this recent LANDSLIDE article. (I think of this whole line of cases as the “FUBAR cases,” in reference to the product at issue in that case.)

When Apple v. Samsung was before the Federal Circuit, Samsung argued the district court erred in “fail[ing] to instruct the jury to ‘factor out’ the unprotectable structural and functional elements of Apple’s designs,” relying on Richardson and related cases. The Federal Circuit disagreed. In its May 2015 decision in Apple v. Samsung, the court ruled that its case law did not support Samsung’s “structural” argument. It also seemed to back away from Richardson, insisting that case “did not establish a rule to eliminate entire elements from the claim scope.” A few months later, the Federal Circuit backed even further away from Richardson in Ethicon.

In its cert petition, Samsung does not rely on—or even mention—Richardson. Instead, Samsung advocates a new approach to design patent claim construction.

Samsung’s approach is based in requirement that a patentable design be “ornamental.” Samsung argues that certain features (or aspects) of a design cannot be “ornamental” as a matter of law and that district courts must “eliminate” these “unprotected features” during claim construction.

So what are the “unprotected features” that Samsung wants courts to “eliminate”? Samsung argues that an ornamental design “cannot include ‘functional’ features, for those are the proper domain of utility patent law,” citing Bonito Boats. In this respect, Samsung’s approach sounds similar to one taken in the FUBAR cases. But Samsung would apparently go further, arguing that an ornamental design “cannot include concepts, shapes or colors,” likening them to “abstract ideas” or “physical phenomenon” under Bilski.

Samsung argues that “[a] district court can easily . . . identify to a jury a design patent’s conceptual, functional and ornamental aspects, and instruct a jury not to find infringement based on conceptual or functional similarities.” Whether or not this would actually be easy may be a matter of some debate, especially in light of past experience with the FUBAR cases. It’s also not clear what would qualify as a “conceptual” aspect (or feature) of a design.

And as a larger policy issue, it’s questionable whether verbal claim dissection is either desirable or appropriate in the context of design patents. The better approach may be, as Chris Carani argued in the LANDSLIDE article mentioned above, to simply instruct juries “that design patents only protect the appearance of the overall design depicted in the drawings, and not any functional attributes, purposes or characteristics embodied in the claimed design.”

It’s also worth noting that under Egyptian Goddess, the prior art may be used to narrow the scope of a claimed design—not through formal claim construction but as part of the infringement analysis. But in Apple v. Samsung, prior art that could have been used to narrow the scope of the claimed designs was not admitted at trial. So, if anything, this case represents a failure to make full use of the Egyptian Goddess framework, not a failure of the framework itself.

Samsung Electronics Co. v. Apple Inc., No 15-___ (design patent scope and damages calculation)(New Petition)

Patent,

by Dennis Crouch

Samsung Electronics Co. v. Apple Inc., No 15-___ (on petition for writ of certiorari) (Samsung Petition)

Samsung has now filed its petition for writ of certiorari challenging the $400 million that it has paid for infringing Apple’s design patents that cover the iconic curved corner iPhone and its basic display screen.[1]  Samsung writes, “[The Supreme Court] has not reviewed a design-patent case in more than 120 years.”[2] Here, Samsung raises two questions that go to the core of the power of design patent rights. In its petition, Samsung frames the issues as follows.

Design patents are limited to “any new, original and ornamental design for an article of manufacture.” 35 U.S.C. 171. A design-patent holder may elect infringer’s profits as a remedy under 35 U.S.C. 289, which provides that one who “applies the patented design … to any article of manufacture … shall be liable to the owner to the extent of his total profit, … but [the owner] shall not twice recover the profit made from the infringement.”

The Federal Circuit held that a district court need not exclude unprotected conceptual or functional features from a design patent’s protected ornamental scope. The court also held that a design-patent holder is entitled to an infringer’s entire profits from sales of any product found to contain a patented design, without any regard to the design’s contribution to that product’s value or sales. The combined effect of these two holdings is to reward design patents far beyond the value of any inventive contribution. The questions presented are:

1. Where a design patent includes unprotected non-ornamental features, should a district court be required to limit that patent to its protected ornamental scope?

2. Where a design patent is applied to only a component of a product, should an award of infringer’s profits be limited to those profits attributable to the component?

Of course, Questions 1 and 2 are likely to impact utility patent rights as well.

The brief cites to Patently-O essays by Gary Griswold and Jason Rantanen (predicting an “explosion of design patent assertions and lawsuits”).

= = = = =

[1] U.S. Design Patent Nos. D618,677; D593,087; and D604,305.
dPat2Dpat1dPat3

[2] See Gorham Co. v. White, 81 U.S. 511 (1871);  Dobson v. Dornan, 118 U.S. 10 (1886); Smith v. Whitman Saddle Co., 148 U.S. 674 (1893); and Dunlap v. Schofield, 152 U.S. 244 (1894).

 

Design Patent Damages

Patent,

By Dennis Crouch

Nordock v. Systems Inc (PowerAmp) (Fed. Cir. 2015)

Nordock’s asserted design patent covers the ornamental design of a lip and hinge plate for a dock leveler. (U.S. Patent No. D579,754). The lever is designed to be attached to a truck loading and can then be adjusted to provide a smoother linkage between the dock and the truck being loaded/unloaded. As a design patent, the patentee does not claim a new and useful invention, but rather the “ornamental design” as shown in the figure below.

Disgorging all of the infringer’s profits: A jury sided with the patentee on infringement and validity, but awarded only $46,000 in reasonable royalty damages. On appeal, the Federal Circuit vacated – finding that the district court had improperly calculated the profit-disgorgement damages.

A design patent holder may seek damages under the standard patent damages statute 35 U.S.C. 284 that sets a floor for damages as “a reasonable royalty for the use made of the invention by the infringer.” As an alternative, the patentee can collect damages under the design-patent-damages provision codified in 35 U.S.C. 289. Under Section 289, an infringer is “be liable to the owner to the extent of his total profit, but not less than $250.” To be clear, when the statute speaks of “his total profits” – that refers to the total profits of the infringer. Opining on the statute, the Federal Circuit has written that § 289 requires “the disgorgement of the infringers’ profits to the patent holder, such that the infringers retain no profit from their wrong.” Nike Inc. v. Wal-Mart Stores, Inc., 138 F.3d 1437 (Fed. Cir. 1998). The Federal Circuit has ruled that a patentee can collect either of these damages theories, but not both. Catalina Lighting, Inc. v. Lamps Plus, Inc., 295 F.3d 1277 (Fed. Cir. 2002). That result is also demanded by the statutory language that “[n]othing 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.”

At trial, the district court forced an apportionment of profits – requiring a calculation the infringer’s profits associated with the lip and hinge plate even though the infringer sold the dock leveler with the plate as an entire unit. As it recently did in Apple, the Federal Circuit here rejects that approach:

[W]e recently reiterated that apportioning profits in the context of design patent infringement is not appropriate, and that “Section 289 explicitly authorizes the award of total profit from the article of manufacture bearing the patented design.” Apple Inc. v. Samsung Elecs. Co., 786 F.3d 983 (Fed. Cir. 2015) (rejecting Samsung’s attempt to limit the profits awarded to the “portion of the product as sold that incorporates or embodies the subject matter of the patent”); see also Nike, (discussing the legislative history of § 289 and Congress’s decision to remove “the need to apportion the infringer’s profits between the patented design and the article bearing the design”).

Here, the dock is welded-to and sold as a unit with the dock leveler and – as such – the calculated profits must be associated with the entire dock leveler being sold. This result should boost the patentee’s damages up to at least $600,000, which represents the infringer’s total profits associated with the infringing sales.

Based upon this error, the Federal Circuit ordered a new trial on damages.

Is it Functional? Preserving the Appeal: There is no question that the design patent here covers a functional invention. The question raised by the infringer’s cross-appeal is whether it is impermissibly functional such that the design patent is invalid. However, in the appeal, the Federal Circuit ruled that argument to be waived because Systems’ counsel “failed to renew the motion for JMOL as to validity with sufficient particularity.” Here, defendant’s counsel gave a general motion following the verdict stating that “as a routine matter whatever motions we made during the trial, JMOL and so forth, we would renew those motions to the extent that they are necessary. . . . Everything we made we renew. I’m not sure what that is, but just for the record whatever we said before.” The patentee did not file any further particular post-verdict motions with respect to validity and – as such – the Federal Circuit ruled that the general post-verdict motion was insufficient to preserve the infringer’s rights.

Is it Functional? The Test: As an alternative judgment, the court also ruled the jury had been presented with sufficient evidence to support a not-impermissibly-functional verdict.

A design patent will be deemed invalid if the claimed design “as a whole, is dictated by functionality.” Factors often considered in the functionality analysis include:

  • Whether the protected design represents the best design;
  • Whether alternative designs would adversely affect the utility of the specified article;
  • Whether there are any concomitant utility patents;
  • Whether the advertising touts particular features of the design as having specific utility; and
  • Whether there are any elements in the design or an overall appearance clearly not dictated by function.

High Point Design LLC v. Buyers Direct, Inc., 730 F.3d 1301 (Fed. Cir. 2013) (these factors “may help”). At trial, the jury heard testimony from the patentee indicating that the design was intended to be distinctive and ornamental, that the claimed plate is not necessary to perform the dock leveling function, and that other designs are available to achieve the same utilitarian purpose. “On this record, there was substantial evidence from which a jury could conclude that the claimed design is not dictated by function.”

= = = = =

There has been some outcry regarding the relatively large disgorgement profits without any proof of an innovative leap or a business impact of the design. However, up to now there have been no congressional proposals on point.  In 1946, Congress eliminated equitable disgorgement from utility patent doctrine. (as interpreted by Aro II (1964)).

The pending design patent legislation would excuse spare-auto-parts manufacturers and sellers from liability.

Guest Post by Gary Griswold on Design Patent Damages

Patent, , , ,

Yesterday, the Federal Circuit summarily denied Samsung’s petition for rehearing and rehearing en banc of the high profile Apple v. Samsung decision.  (The denial was per curiam and didn’t appear on the Federal Circuit’s website, so unless you follow this case very closely you may have missed it.)  In light of that development, Samsung will almost certainly file a petition for certiorari.  Below, Gary L. Griswold, former President and Chief Intellectual Property Counsel for 3M Innovative Properties Company, offers his thoughts on design patent damages following Apple v. Samsung. 

35 USC 289 – After Apple v. Samsung, Time for a Better-Crafted Judicial Standard for Awarding “Total Profits”?

Gary L Griswold[i]

In April, I published an article, 35 USC 289 – An Important Feature of U. S. Design Patent Law: An Approach to Its Application,[ii] in the IPO Law journal. A month later, the Federal Circuit handed down its decision in Apple v Samsung. An analysis of the opinion and its ramifications by Professor Rantanen subsequently appeared on Patently-O.[iii]

Rantanen concluded, “The bottom line is that high damage 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 manufacture 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 an explosion of design patent assertions and lawsuits.”[iv]

There are troubling signs that increased assertion activity has already begun. Design patents are nearly ideal assertion vehicles given that they are inexpensive to obtain with no cost to maintain, are not published prior to grant, and have a full term of protection beginning with grant rather than filing—not to mention the § 289 damages opportunity that can include total profits of the infringer.[v]

Given the good in design patents—they operate as effective and important means for protecting innovatively designed products in the marketplace—how can this good be preserved without incurring the bad— as one example, design patents becoming the next business model for patent assertion entities (PAEs)?

In my April article, I offered a proposal for judicial implementation of § 289 that would involve the court determining “if the patented design is substantially the basis for customer demand for the entire article.” If it was, § 289 total profits damages would apply to the article; if not, total profits would not be available.

The determination would involve a binary decision, not an apportionment, in keeping with the apparent Congressional intent when § 289 and its predecessors were enacted. I noted in the April paper that the “customer demand” proposal assumes that there is a presently existing basis in § 289 for the courts to evolve a practical and useful methodology to apply a “total profits” recovery that avoids clearly unreasonable results, but at the same time captures circumstances where it is sound policy to afford a total profits option for recovery.”

The court in Apple v. Samsung,[vi] in applying § 289, apparently believed its options were limited. It stated “In reciting that an ‘infringer shall be liable to the owner to the extent of [the infringer’s] total profit’, Section 289 explicitly authorizes the award of the total profit from the article of manufacture bearing the patented design…..The clear statutory language prevents us from adopting a ‘causation’ rule as Samsung urges.” The court dismissed an early 2nd Circuit decision which limited a design patent damage award to the profits realized from the sale of a piano shell or case where the shell was sold separately from the inner workings of the piano, stating that Samsung’s smartphones were not sold separately from their shells. Id. at 27-28.

If a court were to look to adopt a workable and practical application of § 289 that would work for all types of articles of manufacture, then perhaps the customer demand proposal is a pathway to a more rationally applied § 289. It is not apportionment, so does not run afoul of the Congressional intent surrounding § 289 and its predecessors. It also avoids some clearly ludicrous results. The example of a patented tire design triggering lost profit recovery on a large agricultural combine as set out my April paper would be avoided given the irrelevancy to any likely customer of the tire design as a basis for purchase of the combine.

In this example, the same outcome, of course, could be achieved by using the separate product exception. Either way, the common sense result is preferable to what otherwise would be an overly literal application of the statute.

The separate product exception, however, has serious limitations. For example, it fails to account for a situation where an inconsequential, but patented, graphical user interface design that is not sold separately is included in an electronic device. Most thoughtful commentators would agree that § 289 profits should not normally apply to these types of relatively complex electronic devices where software features of this type are typically incidental and specifically designed for the device and, thus, are integral to it.

The same issue arises for hardware components that are designed for and integrated into a consumer end product. As an example, semiconductor manufacturers are obtaining design patents on a portion of a semiconductor. Will total profits be disgorged on the entire semiconductor? Yet more troublesome, will the electronic device into which the semiconductor is incorporated be the subject of total profits recovery under § 289? Does the outcome change if the semiconductor is an internally supplied component for the electronic device, not sold separately, versus a non-custom semiconductor that is sourced from an outside vendor? By way of comparison, if there was a utility patent on the semiconductor, would it be likely that the entire device would be subject to damages under the entire market value rule?[vii]

Another example of an exception to the literal application of 35 USC § 289 is suggested by Apple in its responsive brief to “Defendant-Appellants’ Petition for Rehearing en banc.” It states: “As the panel correctly recognized, this distinctive design was not severable from the inner workings of Samsung’s smartphones, see Op. 27-28, in the way that a cupholder is analytically distinct from the overall look-and-feel of a car.”[viii] This exception could be generalized to the situation where the design-patented element is analytically distinct from the overall look-and-feel of the device for which total profits are claimed.

These are just a few of the examples which have and will surface that argue against a literal application of 35 USC § 289. What can be done?

The court in Apple v. Samsung said “policy arguments that should be directed to Congress. We are bound by what the statute says, irrespective of policy arguments that may be made against it.”[ix] Ct. Opinion at 27, fn. 1. But courts have acted or provided guidance in other instances where easily foreseeable outcomes of literal application of a statute would be unreasonable. The entire market value rule is a prime example where a literal approach could have been surfaced as a reason to deny damages for activity beyond the patent scope but within the patented invention’s influence.

Unfortunately, without a course correction we are likely headed for the explosion Professor Rantanen predicts. As noted, for example, we can expect PAE business models to adapt to new opportunities presented by the courts. The result could take design patents way beyond their intended purpose of stimulating invention. In the end, this will likely bring forward efforts to repeal § 289. This would deny a fair and reasonable remedy for those who invent new designs that are substantially the basis of customer demand. Hopefully, a judicial framework will be developed that strikes the right balance and further secures § 289 as a distinguishing feature of U.S. design patent law.

[i] Mr. Griswold is a Consultant residing in Hudson, WI and was formerly President and Chief Intellectual Property Counsel for 3M Innovative Properties Company. The paper reflects the views of the author. He wishes to thank Bob Armitage and Mike Kirk for their excellent contributions to the paper.

[ii] Gary L. Griswold, 35 USC § 289 – An Important Feature of U.S. Design Patent Law: An Approach to Its Application. IPO Law Journal, (April 6, 2015). http://www.ipo.org/wp-content/uploads/2015/04/griswold_an-approach.pdf

[iii] Rantanen, Jason, “Apple v. Samsung: Design Patents Win.” Patently-O. (May 18, 2015) https://patentlyo.com/patent/2015/05/samsung-design-patents.html

[iv] Id.

[v] Marcus, David and Shawn Leppo, “Welcome Fallout from the Smartphone Wars: Federal Circuit embraces strong protection of design patents.” Metropolitan Corporate Counsel. (July 17, 2015). http://www.metrocorpcounsel.com/articles/32603/welcome-fallout-smartphone-wars-federal-circuit-embraces-strong-protection-design-pat?utm_source=mccreview+Upload+20150106&utm_campaign=58fe4b6614-MCC_Review_07_22_20157_21_2015&utm_medium=email&utm_term=0_4624ea9f3a-58fe4b6614-236350701

[vi] Apple v. Samsung, Case No. 2014-1335; 2015-1029 (Fed. Cir. May 18, 2015). http://www.cafc.uscourts.gov/sites/default/files/opinions-orders/14-1335.Opinion.5-14-2015.1.PDF

[vii] The impact on suppliers, manufacturers and retailers will be significant. Who will take the risk of this exposure, the supplier through an indemnity agreement who did not receive the profit on the article, the manufacturer who will need to assess the exposure for each component, or the retailer (for its profit) who sells the final product?

[viii] See Brief in Opp’n to Rhg, Apple v. Samsung, Case No. 2014-1335; 2015-1029 at 27-28 (Fed. Cir. July 20, 2015)

[ix] Apple v. Samsung, Ct. Opinion at 27, fn. 1.

Guest Post by Prof. Burstein: Ethicon v. Covidien — Some key design patent issues

Patent,

In this post, Sarah Burstein, Associate Professor of Law at the University of Oklahoma College of Law, examines the design patent components of the Federal Circuit’s recent Ethicon decision.  Dennis’s discussion of the utility patent’s indefiniteness issue is here.

Ethicon Endo-Surgery, Inc. v. Covidien, Inc. (Fed. Cir. Aug. 7, 2015) Download opinion
Panel:  Chen (author), Lourie, Bryson

Ethicon alleged that Covidien’s Sonicision cordless ultrasonic dissection device infringed various utility and design patents. Each of the asserted design patents claimed a portion (or portions) of a design for a surgical device. A representative image from each patent is shown below:

patents_in_suit

All of the asserted design patents claimed at least some portion of the design of the u-shaped trigger. Three of them also claimed the design of the torque knob and/or activation button.

The district court granted summary judgment that the design patents were invalid for lack of ornamentality and not infringed. Ethicon appealed.

Validity

The Federal Circuit reversed the grant of summary judgment of invalidity. A patentable design must be, among other things, “ornamental.” The Federal Circuit has interpreted this as, essentially, a type of non-functionality requirement.

In deciding that the designs were invalid as functional, the district court relied on a number of factors from Berry Sterling Corp. v. Pescor Plastics, Inc. In Berry Sterling, the Federal Circuit stated that, in addition to the existence of alternative designs:

Other appropriate considerations might include: whether the protected design represents the best design; whether alternative designs would adversely affect the utility of the specified article; whether there are any concomitant utility patents; whether the advertising touts particular features of the design as having specific utility; and whether there are any elements in the design or an overall appearance clearly not dictated by function.

In their appellate briefs, the parties disputed the relevance and relative weight of these factors. Ethicon noted the significant tension between Berry Sterling and other controlling precedents, arguing that “[b]efore and after Berry Sterling, this Court has treated the presence or absence of alternative designs that work as well as the claimed design as a dispositive factor in analyzing functionality.” Covidien, on the other hand, argued that the availability of alternative designs was not a dispositive factor.

In its decision, the panel attempted to harmonize the conflicting precedents by stating that the Federal Circuit had not, in fact, previously “mandated applying any particular test for determining whether a claimed design is dictated by its function and therefore impermissibly functional.”

The panel noted, however, that the Federal Circuit had “often focused . . . on the availability of alternative designs as an important—if not dispositive—factor in evaluating the legal functionality of a claimed design.” The panel then recast the Berry Sterling factors as only being applicable “where the existence of alternative designs is not dispositive of the invalidity inquiry.” The panel did not explain how or when the existence of alternatives would—or would not be—dispositive as to validity. However, it did make it clear that “an inquiry into whether a claimed design is primarily functional should begin with an inquiry into the existence of alternative designs.”

Although Ethicon had submitted evidence of alternative designs, Covidien argued they were not “true alternatives because, as the district court found, they did not work ‘equally well’ as the claimed designs.” The Federal Circuit disagreed with Covidien for two main reasons:

First, the district court’s determination that the designs did not work “equally well” apparently describes the preferences of surgeons for certain basic design concepts, not differences in functionality of the differently designed ultrasonic shears. . . . Second, to be considered an alternative, the alternative design must simply provide “the same or similar functional capabilities.”

The Federal Circuit also decided that, in finding the claimed designs to be functional, the district court “used too high a level of abstraction,” focusing on general design concepts—for example, on the concept of an open trigger—instead of “the particular appearance and shape” of the claimed design elements. The Federal Circuit therefore reversed the district court’s summary judgment of invalidity.

Infringement

This decision also provided some useful clarification about how to apply the design patent infringement test, as formulated by the en banc Federal Circuit in Egyptian Goddess, Inc. v. Swisa, Inc. In the wake of Egyptian Goddess, some lawyers have argued that: (1) a court must (almost) always consider the prior art when analyzing design patent infringement; and (2) in certain circumstances, the prior art can be used to broaden the scope of a patented design.

In Ethicon, the panel helpfully—and accurately—clarifies the rule of Egyptian Goddess, noting that:

Where the claimed and accused designs are “sufficiently distinct” and “plainly dissimilar,” the patentee fails to meet its burden of proving infringement as a matter of law. If the claimed and accused designs are not plainly dissimilar, the inquiry may benefit from comparing the claimed and accused designs with prior art to identify differences that are not noticeable in the abstract but would be significant to the hypothetical ordinary observer familiar with the prior art. (Citations omitted.)

In this case, the district court engaged in a “side by side comparison between the claimed designs and the design of Covidien’s accused shears” and determined that they were plainly dissimilar and, therefore, the design patents were not infringed. The Federal Circuit provided these images as a representative example:

infringementEthicon argued that they were not plainly dissimilar and that the district court erred in not considering the prior art, “which Ethicon characterizes as predominantly featuring thumb-ring and loop-shaped triggers.” Essentially, Ethicon sought to broaden the scope of its patent by showing some significant visual “distance” from the prior art.

The Federal Circuit disagreed with Ethicon, finding no genuine dispute of fact on the issue of infringement. According to the court, the designs were only similar “[o]n a general conceptual level.” And because the designs were plainly dissimilar, the court “did not need to compare the claimed and accused designs with the prior art.” The court therefore affirmed the grant of summary judgment of non-infringement.