Grounds for a claim

What are the key causes of action?

Under the Trademark Statute, litigation for infringement of a registered design can be commenced under 15 USC, section 1114, and for infringement of an unregistered design similar litigation can be commenced under 15 USC, section 1125(a). The test of infringement is likelihood of confusion, which is typically assessed by applying a multifactor test, including the strength of the allegedly infringed mark, the similarity of the accused mark to the allegedly infringed mark, the sophistication or not of the relevant consumers, the competitive proximity of the goods, evidence of actual confusion and the intent of the accused infringer. Regarding the strength of the mark, successful registration creates a presumption that the design has acquired secondary meaning and is not functional (15 USC, section 1057(b)). The presumption of non-functionality, however, is always subject to challenge (15 USC, section 1115(b)(8)), whereas the presumption of secondary meaning can become incontestable.

Under the Patent Statute, litigation for infringement of an issued design patent can be commenced under 35 USC, section 271. The test of infringement, which was announced 150 years ago by the Supreme Court, is whether, ‘in the eye of an ordinary observer, giving such attention as a purchaser usually gives, two designs are substantially the same’ (Gorham Co v White, 81 US 511, 538 (1872)). 

Under the Copyright Act, litigation can be commenced for infringement of a registered copyright. Section 501(a) of the Copyright Act, an infringer is defined as ‘[a]nyone who violates any of the exclusive rights of the copyright owner as provided by sections 106 through 122 or of the author as provided in section 106A(a), or who imports copies or phonorecords into the United States in violation of section 602’. The principal rights defined under section 106 are the right to reproduce or distribute the copyrighted work; to prepare derivative works; and to perform certain types of works (not at issue in the case of designs).  Section 106A gives authors certain moral rights to claim authorship or attribution of his or her work, to prevent misattribution of his or her name, and to prevent certain alterations or ‘mutilations’ of the work.  The test of infringement is substantial similarity among ordinary observers. 


What enforcement procedures are available?

Although not required, most infringement disputes begin by the IPR owner sending a demand letter or cease and desist letter to the alleged infringer. Sending such a letter carries some risk; for example, the defendant can use the demand letter as a basis to initiate litigation in federal court in an action known as a declaratory judgment action, in which the alleged infringer asks the court to confirm that it is not infringing the cited design patent, trademark or copyright registration. 

Although the most obvious enforcement procedure is litigation in a federal court, which can issue injunctions and award monetary relief (most often in the form of disgorgement of profits or damages), another powerful remedy can be awarded by the International Trade Commission in the form of an exclusion order precluding importation into the United States of infringing goods. Another tool available to owners of registered trademarks is to register the mark with US Customs, which can seize infringing or counterfeit goods upon entry. 


What remedies are available?

In all cases, courts are empowered to issue injunctions limiting or prohibiting entirely conduct held to be infringing. At the outset of a case, courts are also empowered to enter preliminary injunctions to prevent irreparable injury to the intellectual property owner while the case is pending. This requires a higher standard of proof that the injury incurred until a final decision can be rendered cannot be remedied by monetary damages. A remedy somewhat similar to an injunction, called an exclusion order, can be entered by the International Trade Commission, pursuant to section 337 of the Tariff Act of 1930 (19 USC, section 1337). Such orders are enforced by US Customs, which has the power to inspect and deny entry to goods within the scope of the order.

The courts are also empowered to award to the intellectual property owner either its actual damages or disgorgement of profits of the infringer. Under 15 USC, section 1117, the Trademark Statute thus permits the trademark owner to recover (1) defendant’s profits and (2) any damages sustained by the plaintiff. In cases of nearly exact copying of a design (ie, counterfeiting), the statute, 15 USC, section 1117(b) and (c), also permits an award of treble damages or statutory damages of up to US$2 million. In Romag Fasteners, Inc v Fossil Grp, Inc, 140 S. Ct. 1492 (2020), the Supreme Court recently resolved a dispute among the lower courts on whether wilful infringement was needed to award disgorgement of the infringer’s profits, finding that as a general matter such proof is not necessary. 

Where a design patent is infringed, the statute permits the additional remedy (not available for infringement of utility patents) of disgorgement of profits (35 USC, section 289). This is in addition to the remedy under 35 USC, section 284, of ‘damages adequate to compensate for the infringement but in no event less than a reasonable royalty for the use made of the invention by the infringer. . . .”

Copyright law also expressly provides, under 17 USC, section 504, that a copyright owner can recover its actual damages as a result of the infringement, and any profits of the infringer that are attributable to the infringement and are not taken into account in computing the actual damages. Instead of actual damages and profits, 17 USC, section 504(c), also authorises an award of statutory damages in the amount of not less than US$750 for each work or not more than US$30,000. Further enhanced statutory damages are available for wilful infringement.

Moreover, in extreme cases of wilful infringement or bad faith, or where there is vexatious litigation conduct, the statutes also authorise awards of attorneys’ fees. 

For designs protectable under copyright, under the Berne Convention, foreign works need not be registered in the United States as a prerequisite to suit. However, like United States works, they must generally be registered to obtain statutory damages and attorneys’ fees under 17 USC, section 412.

Enforcement time frame

What are the time frames for the resolution of enforcement actions for registered and unregistered rights?

The timing of litigation to enforce design rights (regardless of whether under patent, trademark, copyright or the common law) depends largely on the specific court in which the action is filed and the specific judge, not to mention the complexity of the case. There is no uniform rule, and the recent pandemic has slowed progress even further. Because almost all design litigation is in federal courts, judges must defer civil trials to accommodate the demands of their criminal dockets, and judges have wide discretion on how quickly or slowly to move cases along, including how much time to allow for discovery – which is the collection of underlying facts and documents.

One procedural device parties can use to try to expedite relief when they believe they are suffering immediate harm that should not wait until trial to be resolved is what is called a preliminary injunction. Upon a showing of sufficiently immediate irreparable injury, the court can enter a preliminary injunction at the outset of a litigation, under which the accused infringer can be ordered to cease its accused conduct during the pendency of the case (until a full trial on the merits can be held). 

Recent cases

What key cases from the past 18 months should rights holders be aware of?

In Blumenthal Distrib, Inc v Herman Miller, Inc, 963 F3d 859 (9th Cir 2020), a case in which the authors represented the design owner, the court upheld the non-functionality of two iconic furniture designs, the Eames Aluminum Group chair and the Aeron chair, finding that the design must be assessed as a whole, including parts that do serve functions. The court held that ‘a product's overall appearance is necessarily functional if everything about it is functional, not merely if anything about it is functional.’ (Idem at 867.) The Ninth Circuit further clarified that to establish that a product design is legally functional, available alternative designs must be considered to determine if there is any competitive need to use the specific design in issue, explaining that ‘[c]onsistent with that rule, we have also held that the proper standard for whether a claimed trade dress consisting of an “overall appearance” is functional is whether “protecting the trade dress threatens to eliminate a substantial swath of competitive alternatives in the relevant market.’  (Idem at 866.) 

In Ezaki Glico Kabushiki Kaisha v Lotte International America Corp, 986 F3d 250 (3d Cir 2021), involving a simple confection design (for Pocky sticks), the court declined to follow the Supreme Court’s test in TrafFix, and instead adopted a novel test of functionality under which anything ‘useful’ could be functional. The authors note that this decision is controversial, and the claimed trademark owner is seeking review by the Supreme Court.   

Sulzer Mixpac AG v A&N Trading Co, 988 F3d 174 (2d Cir 2021), the court held that the colour scheme for a range of mixing tips (used by dentists to create impressions of teeth for dental procedures) was functional, because the colours signified diameter and enabled users to match a cartridge to the appropriate mixing tip. The court acknowledged the standards for utilitarian and aesthetic functionality as articulated in TrafFix and other cases, and did not attempt to fit its decision within the contours of the TrafFix test. Instead, the decision appears simply to have applied the bottom-line conclusion from TrafFix, where the design concerned a dual-spring arrangement for road signs that had been the subject of a utility patent: namely, that ‘it is the reason the device works.’ (532 US at 34.) The authors note that this decision is also controversial, and the claimed trademark owner is seeking review by the Supreme Court.