With all the patent reform legislation discussion going on, PARTS are not getting as much attention. Specifically, in February, members of the House and Senate each re-introduced the “Promoting Automotive Repair, Trade and Sales Act,” known as the “PARTS Act.” The House bill and the Senate bill are identical. The bills were re-introduced by a bi-partisan group of lawmakers, including Representatives Darrell Issa (R-CA) and Zoe Lofgren (D-CA) and Senators Orrin Hatch (R-UT) and Sheldon Whitehouse (D-RI). The bill was first introduced during the 2012 legislative session, with Rep. Hank Johnson (D-GA) as an original co-sponsor, but died in committee. The PARTS Act of 2013, referred to the House Judiciary Committee on April 23, 2013, also failed to advance in Congress.
The PARTS Act would amend 35 U.S.C. § 271 to provide an exception from design patent infringement for certain external component parts of automobiles, which include collision-related parts such as hoods, fenders, tail lights, and side mirrors. With regard to the use or sale of these motor vehicle component parts, the carve-out in the bill would reduce design patent owners’ period of exclusivity from 14 years to 30 months. Alternative suppliers could manufacture, test, market, and distribute parts pre-sale without infringing upon these design patents. Automobile companies could only enforce the design patents on such parts for 2.5 years – and after that period ends, the alternative suppliers could offer their own generic parts for sale.
In sum, the bill mandates that, 30 months after such parts are first offered for sale, the design patent governing the parts in question would not be infringed by the sale of parts “similar or the same in appearance” by an alternative supplier, if the generic parts are intended to repair a motor vehicle and restore its appearance as originally manufactured. The legislation would not impact automotive companies rights to enforce design patents on parts up to 14 years against other car companies.
The House bill (H.R. 1057) was assigned to the Subcommittee on Courts, Intellectual Property, and the Internet on March 16, 2015. The Senate bill (S. 560) was assigned to the chamber’s Judiciary Committee on February 25, 2015.
Background on design patents. In order for the design of an invention to be patentable, it must be novel, ornamental, and unique. Under 35 U.S.C. § 171, governing design patents, an inventor of a new, original, and ornamental design for an article of manufacture may obtain a patent for that design. According to the United States Patent and Trademark Office’s (USPTO) Design Application Guide, a design consists of the “visual ornamental characteristics” embodied in, or applied to, an article of manufacture. The subject matter of a design patent application may relate to “the configuration or shape of an article, to the surface ornamentation applied to an article, or to the combination of configuration and surface ornamentation.” Thus, the protection afforded by a design patent does not cover the structural or functional characteristics of the invention; instead, the protection is limited to the invention’s ornamental design.
Items such as electronics, furniture, athletic shoes, household appliances, and lighting serve as other common subjects of design patents. Applications for design patents have recently increased – in the five-year period from 2009 to 2013, annual filings of design patent applications increased by about 40 percent, significantly outpacing the 28 percent growth in utility parent applications during the same period. The damages for infringement for design patents can be substantial because, unlike a utility patent, the design patent statute specifically allows the patent owner to disgorge the infringer’s entire profits from the infringing sale and not less than a statutory lower limit of $250.