The Curious Case of Design Patents

Design patents have not received much press until recently. However, the smartphone industry and fashion houses are increasingly turning to patent law to protect their designs. Recent disputes between Apple and Samsung as well as Lululemon and Calvin Klein illustrate an increased reliance on design patents for market domination. Will this become a trend, encouraging design patent applications and enforcement? How could design patent protection help or harm innovation in the future, both for large and small companies?

35 U.S.C. § 171 provides that “whoever invents any new, original and ornamental design for an article of manufacture may obtain a patent therefor, subject to the conditions and requirements of this title.” Ornamentality is determined by the aesthetic, eye-pleasing features of the article not dictated by functional considerations. See Trimble Products, Inc. v. W. T. Grant Co. The purpose behind design patent protection is to advance the decorative arts. See Forestek Plating & Mfg. Co. v. Knapp-Monarch Co. Utility patents afford protection to useful processes and products, but design patents are mainly concerned with the visual characteristics of an article. Holders of utility patents enjoy a 20-year monopoly, whereas design patent holders only have a 14-year monopoly.

Design patents have been criticized for many reasons, including the high fees associated with their required professional drawings, high PTO filing fees, and the fact that they take at least two to three years to obtain. Gene Quinn of IP Watchdog argues that design patents have been underutilized despite their potential value. He points out that while design applications have been on the rise since 1975, only 30,000 design patent applications were filed in fiscal year 2011, much lower than the number of eligible inventions.

Even though many patent professionals refers to design patents as “picture patents,” potential patentees should be aware that design patents can provide overlapping protection if used in tandem with utility patents. The former can provide protection for the exterior of the product, while the latter can protect its inner workings.

On the other hand, Professor Dennis Crouch is skeptical of how easy it is to get design patents, since there is hardly an examination procedure. He states that a design patent is more like a USPTO stamp on a drawing, illustrated by their rather high allowance rate — 90% between the fiscal years 2005 and 2009. Design protection via patents would also be especially costly for startups and up and coming designers who do not have a lot of cash to spare. Especially for fashion designers, patents are traditionally not the first choice for protection as such designs can also be protected by trade dress, trademark and perhaps copyright (with the Senate Judiciary Committee having approved S. 3523, The Innovative Design Protection Act of 2012), albeit to various degrees of success.

Since 2008, Federal Circuit has been paving the way for increased enforcement of design patents, thereby increasing their value. In Egyptian Goddess, Inc. v. Swisa, Inc., 543 F.3d 665 (Fed. Cir. 2008), the Federal Circuit abandoned the “point of novelty” test and held that the ordinary observer test was sufficient. Thus, it became easier to prove infringement, as plaintiffs no longer had to show that the accused design appropriated the novel aspects of their design. In fact, shortly after this decision, Nike filed a complaint against Walmart for infringing the designs of its footwear. In Int’l Seaway Trading Corp. v. Walgreens Corp., 589 F.3d 1233 (Fed. Cir. 2009), the Federal Circuit went a step further and held that the ordinary observer test is the sole test for design patent invalidity.

Now fast forward to 2012. In a complaint filed with the District Court of Delaware on August 13th of this year, Lululemon asserted that Calvin Klein and its manufacturer and supplier infringed “the waistband design elements” and “pant style” of three different design patents Lululemon holds on its “Astro Yoga” pants. While it appears that Calvin Klein has taken down the apparel in question from its website, Lululemon has requested from the court a permanent injunction, damages, a declaration of willful infringement, attorneys fees and an award of costs from the court. Perhaps Lululemon might not be willing to give up the design patent fight so easily.

Design patents also played a key role in the much-debated billion-dollar verdict reached in Apple v. Samsung. To a large extent, the case hinged on Apple’s four design patents on its iPhone and iPad. The jury found that Samsung infringed the four rounded corners and graphical user interface of the iPhone, but not the design features on the iPad. The jury also found that Apple proved by clear and convincing evidence that Samsung infringement was willful as to all the utility patents at issue, in addition to the design patents on the iPhone. Finally, Samsung was not able to invalidate any of Apple’s patents. Much to Samsung’s discontent, Apple was found to have not infringed any of Samsung’s utility patents.

Other exciting developments in the fight between Apple and Samsung have been playing out in the international arena. Samsung recently sought a declaration that that three of its Galaxy tablet computers do not infringe Apple’s designs. Apple counterclaimed for infringement. The High Court of Justice, Chancery division, ruled in favor of Samsung, holding that “Samsung products are very thin, almost insubstantial members of that family with unusual details on the back. They do not have the same understated and extreme simplicity which is possessed by the Apple design. They are not as cool.” Upon appeal, the Court of Appeal affirmed the decision of the lower court.

In the wake of the Apple v. Samsung ruling, commentators have argued that Apple’s design patents on the “four rounded corners” of the iPhone should not have been granted in the first place. Similarly, it seems like a stretch that Lululemon could hold not one but three design patents on a “yoga waistband and style.” Not to mention the fact that Apple just recently was granted a design patent on its iPad 2.

It is questionable whether Apple would really halt its advances in innovation in technology and design had it lost in court over a design patent. Similarly, Lululemon would likely aspire “to elevate the world from mediocrity to greatness” without design patent protection. Why, then, should patent protection give these inherently ingenious industry giants even more power to overreach and stifle competition? Arguably, the public would benefit by having a variety choices for smartphones, tablets and yoga pants that come in different styles, shapes and prices.

These disputes between smartphone and fashion giants may change the way these industries will look at design patents as a useful tool to enforce the rights in their designs. It may become a routine business practice to include design patents as part of a strong portfolio, either by obtaining overlapping protections with utility patents to cover the entire product or by bolstering the existing IP armory by asserting trade dress infringement along with design patent infringement, as Apple did in its allegations against Samsung. Chip Lutton, former Chief Patent Counsel at Apple Computer (2001-2011), in his enlightening talk at Berkeley Law on September 25, 2012, also agreed that the importance of designs patents is on the rise after the Apple v. Samsung decision. Apple’s aggressive enforcement of design patents could certainly be repeated by others in the industry.

How will these wars between giant corporations impact the smaller industry players? Do these developments even have any relevance for those companies that cannot afford design patent protection in the first place because it is too costly and time consuming? These questions are yet to be answered, but one thing is for certain: be on the lookout for design patents, because they have arrived and are likely here to stay.

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