New USPTO Final Rule Establishes Separate Design Patent Bar

Maier & Maier

On November 16, 2023, the USPTO published a new final rule establishing the creation of a separate design patent bar. The final rule follows up on a notice of proposed rulemaking first published in May 2023 where the separate design patent bar was first contemplated. Currently there is only one patent bar which oversees everyone who practices in patent matters before the USPTO, regardless of whether they practice in design patents, utility patents, plant patents, or a combination thereof.

Traditionally, individuals seeking registration to practice in patent matters before the USPTO, including in utility, plant, and design patents, must be admitted to the patent bar. Eligibility for admission required an accredited college or university degree in limited technical subject areas (or an equivalent). These subjects are strictly limited to certain science and engineering degrees, such as biology, biochemistry, biomedical engineering, chemical engineering, computer engineering, computer science, electrical engineering, molecular biology, and other such degrees.2 This requirement applied regardless of the type of patent application the prospective practitioner was seeking to prosecute.

The USPTO points to an increasing number of design patent applications as the reason why they are implementing this new license. According to Kathi Vidal, Director of the USPTO, “Year over year we continue to receive more design patent applications, illustrating the importance of design protection to industry and our economy”. Vidal further stated, “Expanding the admission criteria of the patent bar encourages broader participation and keeps up with the ever-evolving technology and related teachings that qualify someone to practice before the USPTO.”

The new design patent bar would allow for applicants with a bachelor’s, master’s, or doctorate degree in industrial design, product design, architecture, applied arts, graphic design, fine/studio arts, art teacher education, or an equivalent to take a modified patent bar exam to practice exclusively with regards to design patent cases. Design practitioners registered under the separate design bar will be required to place the word “design” (in any format) adjacent to their handwritten signature as well as adjacent to the last forward slash of their S-signature in order to indicate their design patent practitioner status.

The new rule will have no direct impact on patent practitioners already licensed to practice before the USPTO. Additionally, the existing patent bar exam remains unchanged, and applicants passing that exam will still be able to practice on all patent matters, including design patents. Professional and knowledgeable patent counsel that can navigate the different types of patent applications and practices are more important than ever. Maier & Maier has practitioners knowledgeable in all forms of patent practice, including attorneys with years of design patent experience.

Design Day 2023: Highlights and Caselaw

Maier & Maier

On May 4th, 2023, the United States Patent and Trademark Office (USPTO) hosted its annual Design Day event. As part of the event, speakers outlined design patent practice as well as discussed key developments in design patent law from 2022.

Karen Young, Director of Technology Center 2900 at the USPTO provided an update on the state of the Design Patent Technology Center. In recent years, design patents have continued to grow in popularity. In FY2021, the number of design patents filed increased by 17.6% to a total of 54,201 applications, a new record for the USPTO. FY2022 did not bring with it a regression to the mean, as the number of filings decreased by less than 1%, still north of 54,000 applications. Of these filings, the top three classes for design patents were D6, D12, and D14 (Furnishings, Transportation and Equipment respectively).

The average time before first action after filing was 17 months, with an average total pendency of 21.3 months. The number of design patents issued in FY2022 decreased slightly from an all time high of over 35,000 in 2020, but remained strong. As anticipated, Hague applications have increased however with China joining, up from 2,248 to 2,677 applications.

Later in the day, several significant decisions from the Federal Circuit, the District Courts, and the Patent Trial and Appeal Board were discussed.  We highlight those cases here:

LKQ Corporation v. GM Global Technology Operations

In January of this year, a panel court of the U.S. Court of Appeals for the Federal Circuit ruled on two cases brought against GM by alternative car parts manufacturer LKQ Corp who presented a novel argument that the longstanding tests for obviousness of design patents were implicitly overruled by the Supreme Court over fifteen years ago. LKQ Corporation v. GM Global Technology Operations, Case No. 21-2348 (per curiam) (Lourie, J., concurring) (Stark, J., concurring) (hereinafter the “fender” case); LKQ Corporation v. GM Global Technology Operations, Case No. 22-1253 (per curiam) (Lourie, J., concurring) (Stark, J., concurring) (hereinafter the “skid bar” case).

After failure to renegotiate a licensing agreement for several GM auto part design patents to LKQ, GM notified LKQ of pending infringement. In order to continue manufacturing and selling these parts without potential liability, LKQ filed for post-grant review to challenge the validity of GM’s U.S. Patent D797,625 in the “fender” case and GM’s U.S. Patent D855,508 in the “skid bar” case.

The USPTO Patent Trial and Appeal Board found in both cases that LKQ failed to show anticipation or obviousness where the ordinary observer includes retail and commercial purchasers of replacement parts. LKQ’s appeal to the Federal Circuit presented two arguments. First, that the Board erred in their selection of the ordinary observer by excluding purchasers of whole cars for which the patented parts are used in manufacturing. This alleged error would then invalidate the Board’s analysis of anticipation. Second, LKQ argues that the longstanding In re Rosen, 673 F.2d 388 (C.C.P.A. 1982) and Durling v. Spectrum Furniture Co., Inc., 101 F.3s 100 (Fed. Cir. 1996) combined test for obviousness was implicitly overruled by the Supreme Court in KSR International Co. v. Teleflex, Inc., 550 U.S. 398 (2007).

In both cases, the Appeals Court panel dismissed LKQ’s ordinary observer and anticipation argument. Federal Circuit precedent has repeatedly recognized that the ordinary observer may include the buyer of single component parts of a later-assembled product and is not restricted to solely the buyer of that later-assembled product.

The Court in its majority opinion, and Judge Lourie’s concurrence, refused to overrule Rosen and Durling based on KSR, but note a key caveat to their authority. In KSR the Supreme Court rejected “rigid mandatory formula[s]” as limits on obviousness for utility patents, instead adopting a flexible approach. The Court provided several reasons for rejecting LKQ’s argument that KSR implicitly applies to design patent obviousness and therefore invalidates the allegedly too rigid Rosen and Durling test. First, the Rosen and Durling test and design patents in general are not mentioned whatsoever in KSR. Further, KSR was decided over fifteen years ago and has never been applied to design patents. Additionally, Judge Lourie’s concurrence points to the different considerations applied in analysis of design and utility patent obviousness: generally objective properties are considered for utility patents while generally subjective properties are considered for design patents. KSR does not address any subjective obviousness considerations and therefore should not be applied to design patents.

Although the majority and concurring opinions present a strong position against application of KSR to design patents, the Court acknowledged that as a panel they lack authority to overrule existing precedent without a clear directive from the Supreme Court. LKQ’s novel argument may have failed on appeal but there remains a possibility that KSR’s rejection of rigidity will apply to design patents in the future by overruling Rosen and Durling.

 

Wepay Global Payments LLC Cases

Wepay Global Payments LLC v. PNC Bank N.A. No. 2:22-CV-00592-MJH(W.D. Pa. June 1, 2022)

Synopsis:

Wepay brought suit against PNC bank, claiming they were infringing on their patent on a graphical user interface consisting of three squares and a depicted price of $0.00.

Holding:

“[A] side-by-side comparison of WPG’sAsserted Design and PNC’s Accused Design demonstrates that they are ‘sufficiently distinct’ and ‘plainly dissimilar’ such that no reasonable factfinder could find infringement. Any similarity between the two designs is limited to basic geometric shapes, but with notable differences in shape size and spacing such that no ordinary observer would mistake the Accused Design with the Asserted Design or vice versa.”

Early Warning Services, LLC and Samsung Electronics Co., Ltd. v. Wepay Global Payments LLC (PTAB February 9, 2023)

Synopsis:

Both Early Warning Systems (EWS) and Samsung Electronics (Samsung) requested review of the Wepay ‘702 patent mentioned above. In response, Wepay filed statutory disclaimers to narrow the scope of their ‘702 patent.

Holding:

Wepay, by disclaiming all figures and embodiments described in the ’702 patent, disclaimed the entire scope of the sole design claim at issue. While statutory disclaimers may help narrow a claim that may be invalid, they may also lead to adverse judgments before the PTAB, who may even issue a Final Written Decision finding the challenged claim unpatentable.

 

ABC Corp. v Partnership and Unincorporated Associations, 52 F.4th934 (Fed. Cir. 2022)

 Synopsis:

ABC Corp. brought suit claiming infringement of their hoverboard design patents. Their expert report claimed that the prior art was vastly different and thus the patent enjoys a very broad scope. The district court agreed and issued a temporary restraining order (TRO) followed by a preliminary injunction. The decision was appealed to the Federal Circuit.

Holding:

At appeal, the CAFC found the district court erred in multiple aspects. 1) The district court applied the wrong legal standard 2) The district court did not conduct ordinary observer analysis through the lens of the prior art. 3) the court failed to apply the ordinary observer test on a product-by-product basis, considering significant differences in the accused products themselves. 4) The language of the injunction itself was overbroad. It needed to be limited to products that were actually found to infringe.

 

Think Green Ltd. V Medela AG, No. 21 C 5445 (N.D. Ill. Oct. 7, 2022)

 Synopsis:

Think Green Ltd. filed suit claiming infringement by Medela AG for its silicone breast milk collector. The figures contained in Think Green’s patent were computer-generated images instead of the usual line drawings or photographs. With drawings, an inventor intending not to claim any particular material type would leave the drawings free of anything but contour lines, thereby claiming both an opaque and transparent surface. Photographs however strictly limit the design claim to the specific incarnation depicted in the photograph. Medela’s collector, while structurally similar to Think Green’s, is transparent and the computer-generated patent drawings were opaque.

Holding:

The court found that the computer-generated image constituted a choice of surface material. “Even if Medela’s product were exactly the same as Think Green’s design in all other aspects, . . . an ordinary observer would not find the translucent object to be substantially the same as the opaque object. Opaque and translucent objects are categorically different such that they are ‘plainly dissimilar’ and could not be confused by an ordinary observer.”

 

Ex parte Grede et al. (PTAB September 29, 2022)

Synopsis:

In ex parte Grede, a design patent application by Kim Kardashian’s company was denied by an examiner as anticipated from prior art. The examiner relied on a figure depicting only “a fragmentary, front view of the right stocking unit.”

Holding:

On appeal, the PTAB emphasized that the ordinary observer test is used by considering the design as a whole, not in fragments. While relying on less than the entire claim may be appropriate when the applicant has chosen to claim only a portion of the article of manufacture, here the entire article is being claimed. Thus, the denial based on anticipation was inappropriate. An examiner may not cite only a portion of a reference product against the product as a whole. The examiner must compare either two designs for articles of manufacture or two portions of a design.

 

Ex parte Timothy Smith (PTABJanuary 31, 2022)

Synopsis:

In ex parte Timothy Smith, an examiner denied a claimed GUI design based on a composite illustration of 3 independent designs. The resulting image differed from the claimed design only in proportions. The examiner argued that “mere variations in orientation, dimension, proportion, and spacing do not make the claimed design sufficiently different in ornamental appearance.”

Holding:

“To the extent the Examiner is attempting to extract from King a hard and fast rule that all changes in dimension are per se unpatentable advances, the Examiner’s reliance upon this authority is misplaced. To the extent the Examiner is attempting to extract from Stevens a hard and fast rule that all changes in proportion are per se unpatentable advances, the Examiner’s reliance upon this authority is misplaced.”

 

Ideavillage Products Corp. v Konkinklijke Philips N.V

Synopsis:

Ideavillage filed a Petition requesting post-grant review of Konkinklijke Philips N. V’s ‘346 design patent. They presented 42 separate obviousness challenges using unique combinations of references presented, but failed to provide sufficient separate analyses for each combination.

Holding:

“None of the 42 obviousness challenges advanced in the Petition is supported by an adequate analysis. . . In particular, none sufficiently discusses both the differences between the claimed and prior art designs and how any primary reference would have been modified (alone or in view of any other reference) to have the same visual appearance as the claimed design.” The proper steps to an obviousness challenge are as follows:

  • Find a primary reference (a single reference, something in existence, the design characteristics of which are basically the same as the claimed design).
    • BUT also provide an explanation as to how the primary reference is basically the same as the claimed design despite particular differences between the two designs.
  • Use secondary reference(s) to modify the primary reference to create a design that has the same overall visual appearance as the claimed design.
    • BUT also provide an explanation as to how and why the primary reference(s) would have been modified to arrive at a design that has the same overall visual appearance as the claimed design.

For more information and analysis regarding any of these cases and the impact they may have on your IP rights, please feel free to reach out to Maier & Maier.

Design Day 2022 Highlights

Maier & Maier

On April 21, 2022, the United States Patent and Trademark Office hosted its annual Design Day event, featuring speakers discussing recent developments in design patent practice. The virtual event was joined by over 600 attendees.

The amount of design patents filed in FY2021 increased by 17.6% over the previous year, to a total of 54,201 applications, a new record for the USPTO. The increase in design patent applications shows the recognition of the value of design patent protection by inventors and rights holders. Of those filings, 40.4% originated in the United States, while 30.5% were from China. As a consequence of the increased volume of filings, first action pendency increased to 16.6 months, while total pendency remained relatively flat at 21 months.

The next presentation focused on the anticipated entry of China into the Hague system in May 2022. The Hague system allows an applicant to file a single international application for a single international registration, which is then examined according to the laws of each contracting party designated in the registration. With China’s entry on May 5, 2022, the Hague system will include 76 contracting parties, covering 94 countries.

To align with the requirements of the Hague Agreement, China has updated its design laws to increase the patent term from 10 to 15 years, and to include protection of partial designs. Prior to this update, the entire article of manufacture was required to be claimed in a Chinese design patent application. After May 5, applicants for Chinese design protection will be able to disclaim subject matter in broken line, allowing the claiming of only the desired portions of an article.

Subsequent speakers discussed suggestions for effective appeal briefs and examiner’s answers, particularly for obviousness rejections. For examiners, it was recommended to construe the claim when helpful, create a composite of multiple references, and address the differences and their effect on overall similarity. For practitioners, it was recommended to determine the differences and the overall visual impression created by the differences alone and when viewed in the composite of multiple references. The visual impression of the composite can then be compared to the claimed design and the difference between the two determined.

The Patent Trial and Appeal Board’s views on the obviousness of changes in proportion were also discussed. With respect to changes in proportion, many examiners have relied on In re Stevens, 173 F.2d 1015 (1949), which stated that changes in proportion as per se obvious. However, the PTAB has now been giving consideration as to how mere changes in proportion can create a significant difference in the overall visual impression of an article. In particular, in In re Salas, 2019 WL 7790867 (2019) the PTAB declined to view Stevens as a per se rule that all changes in arrangement and proportion are unpatentable. Rather, board referred to In re Blum, 364 F.2d 904 (1967) which stated that  there are no portions of a design that are immaterial or not important.

 In re Surgisil was a 2021 Federal Circuit decision that changed long-standing anticipation analysis for design patents. Prior to this case, examiners relied on In re Glavas, 230 F.2d 447 (1956), which stated that anticipation of a design does not require that the prior art and the claim design were from analogous art. In the Surgisil case, the examiner rejected the design of a lip implant based on the appearance of an art tool. The applicant appealed to the PTAB, which affirmed the rejection, stating that only minor differences exist between the two designs, and the article of manufacture can be ignored for the purposes of determining the claim scope. However, the Federal Circuit reversed, holding that the board decision was erroneous, and that the claim language should match the article that is identified. Consequently, the art tool could not anticipate a design of a lip implant. Subsequent to Surgisil, the test for applicable prior art for designs would now depend on the particular article of manufacture to which the design is applied.

In re Maatita: in this 2018 case, the Federal Circuit held that some designs, for example shoe bottoms, are capable of being enabled by a single plan view drawing. This has led to filings where complex, three-dimensional objects, such as ceiling fans, are depicted by a single, perspective-view drawing, with examiners rejecting those as non-enabled and indefinite. Board decisions have considered this scenario to be a different factual inquiry than that in Maatita. For example, foreshortening distortions due to perspective can introduce uncertainty to the design claim in certain circumstances. At this point, the sufficiency of a single perspective view is not dictated by Maatita, but rather is decided based on a case-by-case analysis.

For more information and analysis regarding design patent protection in the United States and abroad, as well as analysis regarding the impact of these recent developments on your IP rights, please feel free to reach out to us.

Supreme Court Says Components Can Be “Articles of Manufacture” For Calculating Total Profits

Timothy Maier

In Samsung Electronics Co., Ltd. v. Apple Inc., 580 U. S. ____ (2016), the Supreme Court reversed a damages award of approximately $399 million that had been granted to Apple by the trial court based on a “Total Profits” theory, and remanded the case to the Federal Circuit for reconsideration under its new standard.

In this case, Apple Inc. (“Apple”) had sued Samsung Electronics Co. (“Samsung”) for infringement of various utility and design patents covering its mobile phone technology. A jury found that Samsung infringed Apple’s design and utility patents and diluted Apple’s trade dresses. With regard to the design patent issues, the jury in the lower court case had based their award on a “total profits” calculation as called for by the statute, and awarded Apple approximately $399 million, representing Samsung’s entire profit from the sales of the smartphones that were found to be infringing.

With regard to the design patent issue, the relevant statute governing design patent damages (35 U.S.C. §289) provides that:

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.

Samsung appealed the verdict, including the findings of design patent infringement, utility patent infringement, and trade dress dilution, to the Federal Circuit. The Federal Circuit affirmed the award. In relevant part, it concluded that §289 was applicable to the “total profit” of any infringing product incorporating the design feature, because the infringing product (and not just the infringing component) was what would be considered the “article of manufacture.”

However, today, the Supreme Court reversed this decision. Writing for a unanimous Court, Justice Sotomayor stated that “the relevant ‘article of manufacture’ for arriving at a §289 damages award need not be the end product sold to the consumer but may be only a component of that product.” An “article of manufacture,” said the Court, was simply something that was made by hand or by machine, which encompassed both products sold to consumers and components of products sold to consumers.

The Supreme Court justified this decision as consistent with section 171(a) of the Patent Act, which permits “design[s] for an article of manufacture,” and which has long been interpreted by the US Patent and Trademark Office to be applicable to designs for features or components of products as well as complete products. Similarly, section 101 of the Patent Act authorizes patent protection for “any new and useful . . . manufacture,” and has likewise been interpreted to be applicable to features or components of products.

The Supreme Court did not elect to determine whether the “articles of manufacture” at issue in this case were the infringing smartphones or the infringing components or features of the smartphones. Instead, the Supreme Court left it for the Federal Circuit to craft a test for determining whether an “article of manufacture” in a particular case refers to a product sold to a consumer or to a particular component of that product, and to apply that test to determine whether the smartphones or smartphone components were the “article of manufacture.”

While a full analysis of the case’s effects on design patent law will depend on what test the Federal Circuit crafts to determine what is or is not an “article of manufacture,” the Court did strike down the broadest definition of an article of manufacture as necessarily being “the entire infringing product.” This means that, in a design patent litigation, a litigant can no longer automatically expect an award of “total profits” for the end product sold to consumers, and will have to prove entitlement to such an award. Meanwhile, defendants will have more ammunition that they can use in order to reduce the size of a design patent award.