Recent Developments Determining Design Patent Damages

by JD Supra Perspectives
Contact

Design patents have been a hot topic in the IP field because statutory law says that infringers must pay the total profits on an article of manufacture that infringes a protected design. The profit disgorgement and predictability of damage awards represent several reasons innovators protect their ornamental designs with design patents.

However in December 2016, when the U.S. Supreme Court held that an “article of manufacture” can refer to the finished product OR a component of the final product, it upset damage award certainty. Thus, when an infringing product has multiple parts, obtaining total profits from the products sold is no longer guaranteed. Consequently, many design patent owners now fear that damage awards will at best equal a portion of the available total profits.

In its decision, the Supreme Court did not establish a test to determine what the “article” is in a given scenario, thus further hindering predictability. On remand, the Federal Circuit next tasked the district courts to address and develop the appropriate rules.

Since then, several cases have broached the issue. In some, the judges have adopted a test that matches the solicitor general’s test as proposed by the U.S. Department of Justice in an amicus brief in Samsung v. Apple. That test considers four factors, including scope, design prominence, conceptual distinctness, and severability, e.g., the physical relationship between the patented design and the product.

At first glance, it seems that the solicitor general’s four-factor balancing test is gaining traction for design cases with multicomponent products. However in Nordock, Inc. v. Systems, Inc., the attorneys for Nordock questioned whether the test is appropriate for all products covered by design patents. Here, the U.S. District Court for the Eastern District of Wisconsin denied Nordock’s request to define the article of manufacture as Systems’ entire dock leveler.

The judge also denied Systems’ competing request to define the article as a plate that spans the gap between the building and a trailer. Systems also opposed Nordock’s request to order the Federal Circuit to clarify the appropriate factors for determining the article of manufacture since the court had already declined similar past requests.

In Columbia Sportswear North America, Inc. v. Seirus Innovative Accessories — the first design patent case to decide damages since the Supreme Court decision — the trial judge adopted a test that matches
the solicitor general’s proposed test, resulting in a jury award of over $3 million for Columbia that reflected the total profit Seirus earned from the sale of the infringing products.

Here, we see that when the patented portion is integral to the article sold — liner fabric in a glove — juries will find it appropriate to award total profits. Seirus plans to appeal. Since Columbia, we also learned that Judge Koh of the Northern District of California has decided to apply the DOJ’s same four factors in the Apple v. Samsung case.

At present, thought leaders differ in opinion on the solicitor general’s proposed test. Some believe the test’s four factors detract from being perceived as a predictable measure for design patent damages, while
others see them as a determining factor on when and whether a patent owner is entitled to profits on the whole product or components of the products.

Even others say that the four-factor test is really just a dial that essentially dials down the available damages from previously available total profits. So for now, these and future cases — particularly the arguments offered by both sides — will help educate us on the intricacies surrounding current design patent damage awards, inevitably allowing us to better serve our clients’ design patent needs.

*

[Babak Kusha is a partner in the Kilpatrick Townsend's Intellectual Property practice and is the Co-Chair of the firm's Mechanical and Medical Device Patent team.]

 

Written by:

JD Supra Perspectives
Contact
more
less

JD Supra Perspectives on:

Readers' Choice 2017
Reporters on Deadline

"My best business intelligence, in one easy email…"

Your first step to building a free, personalized, morning email brief covering pertinent authors and topics on JD Supra:
Sign up using*

Already signed up? Log in here

*By using the service, you signify your acceptance of JD Supra's Privacy Policy.
Custom Email Digest
Privacy Policy (Updated: October 8, 2015):
hide

JD Supra provides users with access to its legal industry publishing services (the "Service") through its website (the "Website") as well as through other sources. Our policies with regard to data collection and use of personal information of users of the Service, regardless of the manner in which users access the Service, and visitors to the Website are set forth in this statement ("Policy"). By using the Service, you signify your acceptance of this Policy.

Information Collection and Use by JD Supra

JD Supra collects users' names, companies, titles, e-mail address and industry. JD Supra also tracks the pages that users visit, logs IP addresses and aggregates non-personally identifiable user data and browser type. This data is gathered using cookies and other technologies.

The information and data collected is used to authenticate users and to send notifications relating to the Service, including email alerts to which users have subscribed; to manage the Service and Website, to improve the Service and to customize the user's experience. This information is also provided to the authors of the content to give them insight into their readership and help them to improve their content, so that it is most useful for our users.

JD Supra does not sell, rent or otherwise provide your details to third parties, other than to the authors of the content on JD Supra.

If you prefer not to enable cookies, you may change your browser settings to disable cookies; however, please note that rejecting cookies while visiting the Website may result in certain parts of the Website not operating correctly or as efficiently as if cookies were allowed.

Email Choice/Opt-out

Users who opt in to receive emails may choose to no longer receive e-mail updates and newsletters by selecting the "opt-out of future email" option in the email they receive from JD Supra or in their JD Supra account management screen.

Security

JD Supra takes reasonable precautions to insure that user information is kept private. We restrict access to user information to those individuals who reasonably need access to perform their job functions, such as our third party email service, customer service personnel and technical staff. However, please note that no method of transmitting or storing data is completely secure and we cannot guarantee the security of user information. Unauthorized entry or use, hardware or software failure, and other factors may compromise the security of user information at any time.

If you have reason to believe that your interaction with us is no longer secure, you must immediately notify us of the problem by contacting us at info@jdsupra.com. In the unlikely event that we believe that the security of your user information in our possession or control may have been compromised, we may seek to notify you of that development and, if so, will endeavor to do so as promptly as practicable under the circumstances.

Sharing and Disclosure of Information JD Supra Collects

Except as otherwise described in this privacy statement, JD Supra will not disclose personal information to any third party unless we believe that disclosure is necessary to: (1) comply with applicable laws; (2) respond to governmental inquiries or requests; (3) comply with valid legal process; (4) protect the rights, privacy, safety or property of JD Supra, users of the Service, Website visitors or the public; (5) permit us to pursue available remedies or limit the damages that we may sustain; and (6) enforce our Terms & Conditions of Use.

In the event there is a change in the corporate structure of JD Supra such as, but not limited to, merger, consolidation, sale, liquidation or transfer of substantial assets, JD Supra may, in its sole discretion, transfer, sell or assign information collected on and through the Service to one or more affiliated or unaffiliated third parties.

Links to Other Websites

This Website and the Service may contain links to other websites. The operator of such other websites may collect information about you, including through cookies or other technologies. If you are using the Service through the Website and link to another site, you will leave the Website and this Policy will not apply to your use of and activity on those other sites. We encourage you to read the legal notices posted on those sites, including their privacy policies. We shall have no responsibility or liability for your visitation to, and the data collection and use practices of, such other sites. This Policy applies solely to the information collected in connection with your use of this Website and does not apply to any practices conducted offline or in connection with any other websites.

Changes in Our Privacy Policy

We reserve the right to change this Policy at any time. Please refer to the date at the top of this page to determine when this Policy was last revised. Any changes to our privacy policy will become effective upon posting of the revised policy on the Website. By continuing to use the Service or Website following such changes, you will be deemed to have agreed to such changes. If you do not agree with the terms of this Policy, as it may be amended from time to time, in whole or part, please do not continue using the Service or the Website.

Contacting JD Supra

If you have any questions about this privacy statement, the practices of this site, your dealings with this Web site, or if you would like to change any of the information you have provided to us, please contact us at: info@jdsupra.com.

- hide
*With LinkedIn, you don't need to create a separate login to manage your free JD Supra account, and we can make suggestions based on your needs and interests. We will not post anything on LinkedIn in your name. Or, sign up using your email address.