Are Design Patents Worthless? Preliminary Injunction Vacated

PHG Tech v. St. John (Fed. Cir. 2006).

PHG’s design patents cover ornamental designs for medical label sheets.  PHG sued St. John’s for infringement and was awarded a preliminary injunction based on the court’s belief that PHG had a reasonable likelihood of success on the merits.

St. John’s appealed the preliminary injunction (PI) to the Court of Appeals for the Federal Circuit (CAFC).

The CAFC reviews a PI grant for abuse of discretion, and only vacates a PI when there is “clear error.”  In general, however, a PI should only issue after weighing "(1) the likelihood of the patentee’s success on the merits; (2) irreparable harm if the injunction is not granted; (3) the balance of hardships between the parties; and (4) the public interest."

The first factor is a deal-breaker — if the plaintiff does not show a likelihood of eventually succeeding in the case then a PI should not be awarded. Here, St. John’s argued only the first factor based on its argument that PHG’s patents impermissibly cover designs that are primarily functional. 

Functionality in design cases is a tricky beast. 35 USC 171 requires that a design be “ornamental,” and this has been interpreted to exclude designs that are “primarily functional rather than ornamental.”  Of course, every design has some function . . . One way that the court gets at functionality is to see whether there are equally useful alternative designs.  If an alternative design would reduce the utility, then it is “not truly an alternative.”

In this case, the lower court found that there were “a multitude of alternative designs,” but the lower court did not make specific findings as to whether or not those alternative designs altered the utility. St. John’s did, however present expert testimony that the “alternative” designs were not as useful. On appeal, the CAFC was swayed by St. John’s expert and found “clear error” because the lower court (1) did not make any “explicit findings” regarding utility of the alternatives and (2) failed to even mention St. John’s expert report.

“The evidence presented by St. John, in our view, was sufficient to raise a substantial question of invalidity.”  Preliminary Injunction Vacated.

 

Comments

[Karl]

Are design patents worthless? Looking at the five design patents assigned to PHG, I'd say that *some* design patents are definitely worthless...

[Edward D. Manzo]

Design patents are certainly not worthless. They have various benefits: they are inexpensive to prepare and prosecute, and they go through the USPTO much faster than utility patents. The scope of protection is an interesting issue, and the functionality doctrine is definitely a complication. This design looks pretty functional. Where is the "ornamentation" in that design? People try to use design patents sometimes when a utility patent is really called for, but design patents do have a proper role.

[Jeff Dixon]

What "multitude" of alternative designs did the district court find?

[David J. French]

David French writes:

There was an old British case in the 1960's that ruled that a child's pail having notches extending into the inside of the pail (to make sand castles out of sand) supported a valid design registration. The exterior of the pail, which was part of the design was notched too.

The defendant argued that exterior notches were needed to keep the wall of the pail thin and thereby allow a short cycle time when molding the pail through injection molding.

The judge, however, did not consider such a feature to be "dictated by utilitarian function", the language used in the British statute to limit the scope of design registrations. The judge stated that the pail could have been made with a solid exterior that didn't have notches even if I was more expensive to do so. On this basis, the design registration, and its enforcement, were upheld.

I was surprised at the time by this decision. And I am still surprised now.

[steven fox]

The single claim may not have been drafted with the proper scope - in fact, maybe too narrow. Need to examine the claimed design and the prior art. The claimed design may cover non-statutory subject matter.

[Barbara Cookson]

Design protection in the UK and the European Union has been significantly amended in recent years and functionality is no longer an issue. In fact its now a very useful form of protection that even lasts longer than a patent. The scope of protection covers other designs that create the same overall impression on the informed user. However I must say the image in your blog posting above doesn't create much of an impression.
http://www.filemot.com/Designs.htm