Even where a consumer may prefer the particular design to match other parts of a whole, the Federal Circuit held, the aesthetic appeal of that design is insufficient to render the design functional. The appellate panel also declined to adopt special patent exhaustion and right to repair principles for design patents, ruling instead that the principles underlying those theories of unenforceability apply to utility patents and design patents alike.
The US Court of Appeals for the Federal Circuit decided an appeal recently in Automotive Body Parts Association v. Ford Global Technologies, LLC that addresses the patentability and enforceability of design patents covering replacement parts. In particular, the Federal Circuit declined to apply theories from trademark law and held that the aesthetic appeal of a design is inadequate to render the design functional. The Federal Circuit also declined to develop design patent specific rules for patent exhaustion and the right to repair.
The two design patents at issue are directed to certain components of Ford’s F-150 trucks. Specifically, US Patent No. D489,299 (the D’299 Patent) is directed to the exterior hood of a vehicle and US Patent No. D501,685 (the D’685 Patent) is directed to a vehicle head lamp. Representative figures from the D’299 Patent and the D’685 Patent are reproduced below.
The Automotive Body Parts Association (ABPA), a coalition of automotive body parts distributors, sued Ford in district court seeking a declaratory judgement on invalidity or enforceability of the D’299 and D’685 Patents. The ABPA moved for summary judgement, which was denied by the district court. The district court in its denial noted that the ABPA “effectively ask[ed] this Court to eliminate design patents on auto-body parts.” Further, even though Ford had not moved for summary judgement, the district court entered a judgment in favor of Ford, which the ABPA appealed to the Federal Circuit.
On appeal, the ABPA argued that the designs depicted in Ford’s patents are functional because they aesthetically match the parts of the F-150 truck.
To support their position, the ABPA asked the Court to borrow the principle of “aesthetic functionality” from trademark law. The principle of “aesthetic functionality” refers to situations where a party cannot use a trademark to inhibit competition by protecting features that put competitors at a significant non-reputation-related disadvantage, such as protecting the way a product looks. The Federal Circuit declined the ABPA’s invitation to be the first to apply the “aesthetic functionality” doctrine to design patents, stating that the considerations that drive the aesthetic functionality doctrine of trademark law do not apply to design patents. Design patents grant their owners exclusive rights to a particular aesthetic for a limited time, whereas trademark law promotes competition by allowing their owners to identify and distinguish a particular source of goods or services from another source, potentially indefinitely.
The ABPA further attempted to support its functionality argument by analogizing its case with Best Lock, in which the Federal Circuit held that the design of a key blade was primarily dictated by function and the corresponding design patent was, therefore, invalid. Best Lock, however, turned on the fact that no alternatively designed key blade would be able to mechanically operate a corresponding lock; not that the blade and lock were aesthetically compatible as the ABPA averred. For its part, Ford introduced abundant evidence that alternative headlamps and hood designs physically fit with its F-150 trucks, further distinguishing Best Lock.
The Federal Circuit was also unpersuaded that Ford’s designs were not a “matter of concern” to consumers who only assess the designs for aesthetic compatibility, as the ABPA averred. The Federal Circuit explained, “By definition, if a consumer assesses the aesthetic of a design in considering whether to purchase it, the design is a matter of concern.” Accordingly, the ABPA failed to prove by clear and convincing evidence that Ford’s designs are functional.
The ABPA further argued that Ford’s design patents are unenforceable under the doctrine of patent exhaustion. While patents are said to grant a monopoly to the holder of the patent, when the patent holder sells its patented product, the product is “no longer within the limits of the monopoly” i.e., the patent rights have been exhausted and the patent holder is no longer able to control the sold product.
Ford conceded that when it sells an F-150 truck, its patents are exhausted, but only as to the components actually sold as part of the truck, at the time of the sale. The ABPA argued that the doctrine of patent exhaustion extends further to replacement parts so long as those parts are intended for use with Ford’s trucks. However, patent exhaustion only applies to the article sold, not a “second creation of the patented entity.” The replacement parts sold by the ABPA’s are not the original products sold by Ford when the truck is sold, and the sale of the replacement parts by members of ABPA are not authorized sales by Ford. Thus, ABPA members’ sales of replacement parts are not protected by the doctrine of patent exhaustion and the Federal Circuit declined to create a design-patent-specific rule.
Lastly, the ABPA argues that purchasers of the F-150 trucks have the right to repair their trucks using replacement parts that embody Ford’s design patents. The Federal Circuit emphasized, however, that the right-to-repair doctrine “does not permit a purchaser to infringe other patents by manufacturing separately patent components of the purchased article” and again declined to create new law in the design patent context. While a different outcome may have been reached had Ford only claimed the entire vehicle, it instead claimed distinct designs for its hood and headlamp. Thus, the Federal Circuit held, making or using those designs without authorization infringes Ford’s design patents.
While the ABPA and others may seek to renew legislative efforts to limit the term of design patents for replacement parts, this case confirms the value, at least for now, of pursuing design patents for the replaceable components of a product.