This week’s decision by the United States Court of Appeals for the Federal Circuit in Egyptian Goddess, Inc., v. Swisa, Inc.1 alters the test and arguably eases the burden for proving infringement of United States design patents by discarding one part of a formerly two-part test. In the first ever en banc decision by the Federal Circuit in a design patent case, the court unanimously held that the “ordinary observer” test for design patent infringement is the sole test for determining infringement of a design patent. Prior to the Egyptian Goddess decision, the holder of a design patent also was required to prove that the accused product misappropriated the specific points of novelty of the patented design. This separate “point of novelty” test has now been rejected, according to the appeals court. A close reading of the decision suggests, however, that the two tests actually have been merged into a slightly altered “ordinary observer” test that now takes into account the designs in the prior art.
Background and Previous Infringement Tests
A design patent is available to protect “any new, original and ornamental design for an article of manufacture.”2 Patentability and validity of a design are determined by the same novelty and obviousness requirements as for utility patents, although they are evaluated in view of ornamentality of the invention, rather than functionality of the invention.3 But unlike the legal standard for infringement of a utility patent, the standard for infringement of design patents has been less certain.
Beginning in 1871 with the U.S. Supreme Court’s decision in Gorham Co. v. White,4 the test for infringement of a design patent was whether, “in the eye of an ordinary observer, giving such attention as a purchaser usually gives, two designs are substantially the same, if the resemblance is such as to deceive such an observer, inducing him to purchase one supposing it to be the other, the first one patented is infringed by the other.” The test became known as the “ordinary observer” test, and it was applied thereafter as the proper standard for determining design patent infringement. The landscape definitively changed about 25 years ago with the Federal Circuit’s decision in Litton Systems, Inc. v. Whirlpool Corp.5 In that case, the appeals court ruled that, for a design patent to be infringed, “no matter how similar two items look, the accused device must appropriate the novelty in the patented device which distinguishes it from the prior art.”6
In cases since Litton Systems, infringement of a design patent has required appropriation of both the overall appearance of the design and the novel features of the patented design.7 The required analysis had thus evolved into a two-part test for design patent infringement, requiring separate evaluations of and determinations as to the “ordinary observer” test and the “point of novelty” test.8 Indeed, in recent years, the Federal Circuit had stated that “[t]he merger of the point of novelty test and the ordinary observer test is legal error.”9
The importance and purpose of the ordinary observer test has scarcely been challenged. In contrast, and as recognized by the en banc court in Egyptian Goddess, the point of novelty test has proved to be difficult to apply, particularly “where the claimed design has numerous features that can be considered points of novelty, or where multiple prior art references are in issue and the claimed design consists of a combination of features, each of which could be found in one or more of the prior art designs.”10 The difficulty also likely derives from the lack of a decisive standard or test for determining the points of novelty of designs. The purpose of the test has been expressed by the Federal Circuit as a desire “to focus on those aspects of a design which render the design different from prior art designs.”11 Also, courts have expressed that it is incorrect simply to consider an overall design appearance for the point of novelty test,12 and, further, that “points of novelty relate to differences from prior designs, and are usually determinable based on the prosecution history.”13 In application, however, the point of novelty test has proved to be relatively unwieldy, or at least elusive.
For instance, as exemplified by the Egyptian Goddess panel decision and other cases such as Lawman Armor Corp. v. Winner Int’l, LLC,14 district courts and Federal Circuit panels have struggled in their application of the point of novelty test, particularly where the claimed design includes numerous features that might be considered points of novelty, or where multiple prior art references are in issue. The Federal Circuit’s en banc holding in Egyptian Goddess is surely intended to aid future courts in their analyses of design patent infringement, but whether it has that effect remains to be seen. Before turning to the particulars of that decision, however, it is worthwhile first to review the district court’s and Federal Circuit panel’s rulings that ultimately led the appellate court to rehear the Egyptian Goddess case en banc.
The District Court and Federal Circuit Panel Decisions
Egyptian Goddess, Inc. originally brought its lawsuit in the United States District Court for the Northern District of Texas, alleging that Swisa, Inc. and Dror Swisa (collectively, “Swisa”) had infringed its U.S. Design Patent No. 467,389 (“the ’389 patent”). Both the claimed design and Swisa’s accused design are nail buffers formed of hollow, open-ended tubes that are rectangular in length and have generally square cross-sections. Among other features, the claimed design includes buffer pads on three of its four sides, whereas Swisa’s accused product includes buffer pads on all four of its sides.
On motion for summary judgment of noninfringement, the district court applied the then-existing two-part test for design patent infringement, finding that the accused Swisa product does not appropriate the point of novelty of the ’389 patent. Although the parties disagreed about the point (or points) of novelty of the claimed design, the district court determined that the point of novelty was the existence of “a fourth, bare side to the buffer.” The district court made this determination in view of the closest prior art presented by the parties, U.S. Design Patent No. 416,648 (“the Nailco patent”), which discloses a nail buffer formed by a hollow, open-ended tube having an equilateral triangular cross-section with buffer pads on all three of its sides. The district court determined that the Nailco patent discloses all but one of the elements of the ’389 patent, namely, the addition of a fourth side without a pad. Applying this finding, the district court concluded that there was no infringement because the accused Swisa product does not incorporate the point of novelty of the ’389 patent.
On appeal by Egyptian Goddess, a divided panel of the Federal Circuit affirmed, agreeing with the district court that there was no issue of material fact as to whether the accused product appropriates the point of novelty of the patented design. In its analysis, however, the panel ruled that “[f]or a combination of individually known design elements to constitute a point of novelty, the combination must be a non-trivial advance over the prior art.”15 Applying this standard, the Federal Circuit panel determined that, in light of the prior art, no reasonable juror could conclude that the point of novelty of the ’389 patent constituted a non-trivial advance over the prior art. Judge Dyk dissented on the basis that he would not have adopted the “non-trivial advance” test. The dissenting judge viewed that test as “inconsistent with and unsupported by prior precedent,” “conflat[ing] the criteria for infringement and obviousness,” “appl[ying] only to designs that involved combinations of design elements,” and “improperly focus[ing] on the obviousness of each point of novelty, rather than the obviousness of the overall design.”16 The patent community quickly raised numerous debates addressing the import of the panel’s decision.
The Federal Circuit soon quieted the discontent by granting rehearing en banc. In doing so, the court asked the parties to address several questions concerning the applicable standards for infringement of a design patent, including “whether the ‘point of novelty’ test should continue to be used as a test for infringement of a design patent; whether the court should adopt the ‘non-trivial advance test’ as a means of determining whether a particular design feature qualifies as a point of novelty; how the point of novelty test should be administered, particularly when numerous features of the design differ from certain prior art designs; and whether district courts should perform formal claim construction in design patent cases.”17 As discussed below, the en banc Federal Circuit’s rejection of a separate “point of novelty” test answered the first question in the negative and essentially mooted the next two. The en banc decision also addresses the final question, but does so in fairly loose terms that grant district courts broad discretion in conducting claim construction analyses in design patent cases.
Where We Are Now: The En Banc Egyptian Goddess Decision
In a unanimous en banc decision authored by Judge Bryson, the Federal Circuit rejected the point of novelty test as well as the “non-trivial advance” test, and returned to the “ordinary observer” test as the sole standard for determining infringement of design patents. In doing so, however, the Federal Circuit actually modified, or at least restated, the ordinary observer test of Gorham by indicating that the test should now be conducted in light of the prior art. Although a few earlier cases had taken such an approach, the standard has now been made explicit. Notably, this “adjustment” to the ordinary observer test, if it can be considered such, appears to be an attempt by the Federal Circuit to retain the useful aspects of the point of novelty test, while rejecting those aspects that made the test cumbersome.
The court reached this result by reviewing the legal standards for design patent infringement, focusing first on the genesis and subsequent development of the point of novelty test. The court considered the ordinary observer test of Gorham and then turned to the evolution of the point of novelty test, starting with the Litton Systems18 decision. The court also focused on the U.S. Supreme Court’s decision in Whitman Saddle,19 concluding that the Supreme Court in that case “did not adopt a separate point of novelty test for design patent infringement cases.”20 Notably, this interpretation of the Whitman Saddle decision left the Federal Circuit unrestricted by Supreme Court precedent and thus free to reject the point of novelty test.
Continuing in its analysis, the Federal Circuit then considered several cases subsequent to Whitman Saddle,21 and determined generally that they “interpret[ed] the ordinary observer test of Gorham to require that the perspective of the ordinary observer be informed by a comparison of the patented design and the accused design in light of the prior art, so as to enable the fact-finder to determine whether the accused design had appropriated the inventiveness of the patented design.”22 Thus, the Federal Circuit viewed these cases as applying the ordinary observer test from the perspective of one who is informed by a comparison of the patented design and the accused design in light of the prior art.
As one example, the Federal Circuit pointed to a decision by the U.S. Court of Appeals for the Sixth Circuit which explained that the “ordinary observer” applicable to the Gorham test is neither a novice nor an expert, but one who is “capable of assessing similarity of the patented and accused designs in light of the similar objects in the prior art.”23 The Federal Circuit also pointed to a decision by the U.S. Court of Appeals for the Eighth Circuit which ruled that the applicable determination “requires a comparison of the features of the patented designs with the prior art and with the accused design.”24 Indeed, the Federal Circuit noted that its own decision in Litton Systems — which provided the foundation for the distinct point of novelty test — stated that the degree of similarity between the accused design and the patented design should be assessed in light of designs in the prior art.
With this background, the Federal Circuit concluded that Litton Systems and the predecessor cases resulting in the separate point of novelty test “are more properly read as applying a version of the ordinary observer test in which the ordinary observer is deemed to view the differences between the patented design and the accused product in the context of the prior art.”25 The Federal Circuit noted that the purpose of the point of novelty test — namely, “to focus on those aspects of a design which render the design different from prior art designs”26 — can be sufficiently served by applying the ordinary observer test through the eyes of an observer familiar with the prior art.27 The Federal Circuit further explained as follows:
[E]xamining the novel features of the claimed design can be an important component of the comparison of the claimed design with the accused design and the prior art. But the comparison of the designs, including the examination of any novel features, must be conducted as part of the ordinary observer test, not as part of a separate test focusing on particular points of novelty that are designated only in the course of litigation.28
Accordingly, the Federal Circuit held that the ordinary observer test of Gorham, conducted in light of the prior art, should be the sole test for determining whether a design patent has been infringed. As recognized by the court, this ruling “has the advantage of avoiding the debate over the extent to which a combination of old design features can serve as a point of novelty under the point of novelty test.”29 Likewise, the ruling obviates the need to determine whether the panel’s “non-trivial advance” test should survive, as it no longer is applicable under the now-mandated unitary “ordinary observer” test.
Because the announced legal standard is to be made (in all but the clearest of cases) with reference to prior art designs, the Federal Circuit clarified that the test is not one for determining validity, but is solely a test of infringement. “Thus, as is always the case, the burden of proof as to infringement remains on the patentee.”30 However, the burden of production as to any comparison prior art is on the accused infringer. “The accused infringer is the party with the motivation to point out close prior art, and in particular to call to the court’s attention the prior art that an ordinary observer is most likely to regard as highlighting the differences between the claimed and accused design.”31
The Federal Circuit also considered the appropriateness of claim construction in design patent cases. Recognizing that design patents typically are claimed as shown in the drawings, the Federal Circuit discouraged detailed claim constructions, stating that “the preferable course ordinarily will be for a district court not to attempt to ‘construe’ a design patent claim by providing a detailed verbal description of the claimed design.”32 The Federal Circuit identified potential risks of providing a detailed written claim construction, including “the risk of placing undue emphasis on particular features of the design and the risk that a finder of fact will focus on each individual described feature in the verbal description rather than on the design as a whole.”33 Nonetheless, the Federal Circuit stated that a district court’s decision to issue a relatively detailed claim construction is within the court’s discretion and, absent a showing of prejudice, will not be reversible error.34
Finally, the Federal Circuit turned to the facts of the case at hand in view of the ordinary observer test as elucidated in the decision. Applying the modified test for infringement, much of the court’s analysis remained the same, including its comparison of the claimed design and the accused product in view of the prior art. Indeed, the analysis was largely merely abbreviated in that there was no longer a need to identify the points of novelty of the patented nail buffer design. Viewed in the context of the prior art, the Federal Circuit ruled that an ordinary observer would not be deceived into believing that the Swisa nail buffer, which includes a fourth side with a buffer pad, is “the same as” the patented buffer, which includes a fourth side without a buffer pad. The absence of the buffer pad is relevant because the prior art Nailco patent discloses a nail buffer with buffer pads on all of the sides. Without concern for whether this feature is a point of novelty, the Federal Circuit was able simply to rely upon this distinction as a basis for determining that the accused Swisa nail buffer does not infringe the ’389 patent under the modified ordinary observer test. Thus, the Federal Circuit affirmed en banc the district court’s entry of summary judgment of no infringement.
It is curious that, in its analysis, the Federal Circuit twice phrased the issue as requiring a determination of whether an ordinary observer, taking into account the prior art, would believe the accused Swisa product to be “the same as” the design of the ’389 patent.35 Such a standard is more stringent than the announced test, which, like the original Gorham test, merely requires that the accused and patented designs be “substantially the same.”36 Stated another way by the en banc court, infringement will not be found “unless the accused article ‘embod[ies] the patented design or any colorable imitation thereof.’”37 This seemingly imprecise phrasing by the court during its application of the new rule to the facts at hand may result in fodder for future litigants in design patent cases.
Also of note, but less likely to be raised by future litigants, is the fact that the announced legal standard for design patent infringement technically constitutes dicta, as the pronouncements concerning the refined test were not essential to the court’s ruling. We suspect, however, that this notion will be relegated to, at most, an academic discussion among patent law scholars.
Implications of the Egyptian Goddess Decision
The Egyptian Goddess decision changes the landscape for design patents in the United States. Most prominently, the test for design patent infringement has been simplified to a single-part, “ordinary observer” test that has been recharacterized so that the analysis is conducted in view of the prior art. Although the revised ordinary observer test may still garner uncertainty due to the continued need for subjective, threeway comparisons between the patented design, the accused product and the prior art, the prior two-part test for design infringement relied at least as much, if not more, on such subjective observations. Thus, at least arguably, the road to proving infringement has been simplified for design patent holders.
To be sure, the additional flexibility afforded design patent holders due to the unification of the infringement analysis into a single “ordinary observer” test may prove useful in litigation. Among other benefits, the patentee no longer bears the burden of identifying specific points of novelty in its patent and, further, proving that the accused design appropriates that novelty. And the burden of production of any prior art now rests on the accused infringer. For these reasons, it appears that the removal of the distinct point of novelty test avoids many of the risks and problems previously associated with identifying with specificity the supposed points of novelty in the claimed design. And the Federal Circuit is correct in noting that the new test eliminates the overt debate over what can constitute a point of novelty.
But is the task truly made easier for design patent holders? The purported advantages of the refined infringement test may prove to be superficial, since the newly characterized ordinary observer test now accounts for the prior art. It is conceivable that the point of novelty test has in fact not been eliminated, but merely swept under the rug of the ordinary observer test. For example, in a crowded field of art, where a claimed design is similar to the designs of the prior art, the modified ordinary observer test of Egyptian Goddess is likely to be similar to the prior two-part test. However, in an open field of art, where the claimed design is clearly dissimilar to the prior art, the claimed design may achieve greater breadth of protection under the modified ordinary observer test. Thus, in relatively complex cases, the debates and concerns of the old, two-part test may persist, but under the guise of an evaluation of the ordinary observer test. In short, just as was required by the point of novelty test, the test announced in Egyptian Goddess does not remove the need for a detailed assessment of the prior art. Likewise, it does not remove the need for competent experts to debate what an ordinary observer would or would not view as similar, when considered in light of the prior art.
At least for now, design patent holders and those interested in protecting the ornamental design of their products with design patents appear to be the beneficiaries of the Federal Circuit’s en banc decision. But the actual impact remains to be seen. As the Federal Circuit itself noted, “we leave it to future cases to further develop the application of this standard.”38