The U.S. Court of Appeals for the Federal Circuit recently issued a significant decision changing the test for infringement of design patents. The Court discarded the requirement that an accused product must incorporate all of a design patent’s “points of novelty” in order to infringe. Egyptian Goddess, Inc. v. Swisa, ___ F.3d ___, 2008 U.S. App. LEXIS 20104 (Fed. Cir. Sep. 22, 2008) (en banc). This decision eliminates a key defense to design patent infringement and strengthens design patents that differ significantly from prior art designs.

1. The Prior Two-Part Infringement Test

A design patent covers the ornamental, non-functional appearance of a product, and its scope is defined solely by its drawings. Prior to this decision, the test for design patent infringement had two requirements. First, the design patentee had to prove that the accused product was substantially similar to the design patent such that an ordinary observer would likely be deceived as to the design’s origin at the point of purchase. If that showing could be made, the design patentee then had to demonstrate how the accused product incorporated each point of novelty that separated the patented design from prior art designs. Infringement was found only if both tests were met.

2. The Modified “Ordinary Observer” Test for Infringement

Recognizing various difficulties presented by the point of novelty test, the Federal Circuit set it aside and adopted a modified ordinary observer test of infringement. The Court did not make a design patent’s points of novelty irrelevant, but rather changed the perspective from which infringement should be evaluated. Specifically, the hypothetical “ordinary observer” used to determine infringement is now assumed to be familiar with the prior art designs. Such an “informed observer” will be more likely to recognize the novel features that distinguish the patented design from the prior art. While not all of these novel features must exist in the accused product, the more such features the accused product incorporates, the more likely it is that an informed observer will find it to be substantially similar and infringing.

The Federal Circuit’s recent holding effectively shifts the burden for producing prior art from the design patentee to the accused infringer. Under the old standard, the design patentee had to produce prior art so as to define the points of novelty incorporated in the accused product. That requirement is now eliminated. Though the design patentee maintains the ultimate burden of proving infringement based on similarity, the obligation to produce prior art as a means to highlight the differences between the design patent and the accused product now lies with the accused infringer. Since the fact finder should be familiar with the prior art, the scope of a design patent as defined by its differences from the prior art remains a significant factor in the infringement analysis. Thus, design patent litigation will likely still involve opposing experts defining the prior art and opining as to what an informed observer would find to be similar.

3. Practical Effects

Whether you own a design patent or are concerned with infringing one, a key question to consider is the quantity of relevant prior art and the differences between the patented design and the prior art designs. Naturally, it is more difficult to distinguish a patented design from a large crowd of prior art than from a small one. A design patent that is significantly different from the prior art will now likely be stronger and broader in scope than before this decision. The owner of such a broad design patent need no longer fear dismissal of its infringement action on the grounds that one of the patent’s specific points of novelty is not in the accused product. So long as the accused product shares enough of the design patent’s distinguishable features so as to appear similar to an informed observer, the design patentee may prevail.

This holding is likely to make design patents more valuable, particularly for products that differ significantly in appearance from prior art designs. The new standard should be considered in determining whether to file for design patents and in evaluating existing design patents when you are designing a new product.

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