Contrary to popular culture, patents are not limited to the
functional, utilitarian, or scientific aspects of a product. In
fact, design patents, although often overlooked, can be a
tremendous, cost-effective asset to many companies IP portfolios.
Despite the fact that design patents last only fourteen years from
the date of issuance, they can provide businesses with invaluable
time to build their products and brands at a relatively low cost.
Indeed, design patents provide a number of strategic advantages:
(1) the great majority of design patent applications are granted
and their cost is relatively low; (2) few design patents have been
invalidated in recent years; and (3) design patents provide
valuable flexibility for patentees seeking to exploit proprietary
rights.
Design patents protect the ornamental design of an "article of
manufacture." 35 U.S.C. § 171. A design patent can be
awarded for the "visual characteristics" of an
article's design when the design is novel, non-obvious, and
ornamental. Design patents can cover everything from computer
screen shots to tennis shoes and, for the reasons discussed below,
can be important assets. Last year, the USPTO issued Design Pat.
No. D599,372 to Google for its familiar "ornamental design for
a graphical user interface."
Rate of Issuance
The high rate of issuance of design patents is demonstrated in
the U.S. Patent and Trademark Office's annual reports. Design
patents enjoyed an average allowance rate of about 90% during the
period FY2005–FY2009 as measured by the percentage of
disposals that were allowances. In addition, design patents that
issue are subjected to less arduous prosecution than issued utility
patents. In a survey of design patents that were issued in 2009,
only about 1.2% were rejected on the basis of conflicting prior
art, such as prior patents or publications, and 81.6% sailed
through prosecution without any rejections at all.1
Meanwhile, most applications for utility patents issued in 2009
were rejected on prior art grounds. Reflecting the less rigorous
examination of design patents, over one half of design patents
issued in 2009 were pending for less than a year, contrary to the
average utility patent pendency of well over two years. The
relative ease with which design patents are issued reduces an
applicant's costs.
Validity and Enforceability
Courts have found few design patents invalid in the past several
years. In 2008, the Federal Circuit generally enhanced design
patent rights by making design patent infringement easier to prove
under the so-called "ordinary observer" test. See
Egyptian Goddess, Inc. v. Swisa, Inc., 543 F.3d 665 (Fed. Cir.
2008). More recently, the Federal Circuit held that the
"ordinary observer" standard applies not only with
respect to design patent infringement, but also in determining
design patent validity. Int'l Seaway Trading Corp. v.
Walgreens Corp., 589 F.3d 1233 (Fed. Cir. 2009). This decision
could change how easily design patents are issued by the PTO and
invalidated by courts. But in general a relatively favorable
environment for design patent owners is likely to continue, with
design patent protection well worth the cost.
Flexibility
Owning a design patent in addition to other intellectual
property protection can provide a patentee with flexibility in
terms of enforcement and damages. Where a product is protected by
both utility and design patent protection, a patentee has the
opportunity to prevail on a design patent claim even if the claim
for utility patent infringement fails. In terms of damages, the
Patent Act provides that a prevailing patentee will receive
compensatory damages of at least a "reasonable royalty,"
and possibly lost profits, for the utilitarian invention claimed.
35 U.S.C. § 284. Additionally, if the patentee can prove that
the infringer also infringed a design patent, the infringer is
liable to pay the patentee an amount equal to the infringer's
profits attributable to the infringing article(s). 35 U.S.C. §
289. Therefore, a patentee who owns a utility patent for
utilitarian features and a design patent for ornamental features
can potentially receive compensatory damages for each patent. In
addition, since a design patent is likely to issue much sooner than
a utility patent, the design patent may allow the patentee to sue
and obtain injunctive relief much earlier in a product's life
cycle.
In sum, it is worth taking another look at the often overlooked
design patent.
Design patents can be a powerful and cost-effective part of a
comprehensive IP portfolio. They can provide a high value for a low
cost and add flexibility to a patentee's enforcement and remedy
options, strengthening the value of a company and its brand.
Footnotes
1 See D. Crouch, Design Patent Rejections, Patently-O Blog, www.patentlyo.com/patent/2010/01/design-patent-rejections.html (study based on review of file histories of 1049 U.S. design patents issued in 2009). A total of about 23,415 U.S. design patents issued in 2009. See USPTO Performance and Accountability Report: Fiscal Year 2009, Table 1 at 112, available at www.uspto.gov/about/stratplan/ar/index.jsp .
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