Design patents are misunderstood and under-utilized. But that is changing. The last few years have seen a significant shift, favoring the design patent owner, on evaluating design patent infringement. That shift was capped off by the case of Apple v. Samsung, a case that breathed new life into design patents by awarding damages against Samsung for infringement of iPhone design patents. For those not following the Apple v. Samsung saga closely, Samsung sold 10.7 million devices generating $3.5 billion in revenue and must now pay $290 million (in addition to about $640 million previously awarded), with most of the damages attributed to design patent infringement.
At first blush design patents might seem both easy to obtain and easy to enforce. But as in many other areas of law, design patents are not as easy as they seem. In fact, they are quite complex, so much so that there are only a handful of recognized experts on design patent law in the U.S., an example being our good friend Perry Saidman of the Saidman Design Law Group.
We accept design patent infringement cases on contingency and other alternate fee arrangements but we are very selective. We also evaluate design patents slightly differently from utility patents, both for infringement and damages. Here is a list of important factors we consider when evaluating design patent cases independent of the fee arrangement with our client:
- The strength of the infringement case evaluated under the ordinary observer test.
- The prior art.
- The value of the design to the infringer.
- The value of the design to the customer.
- The identity of the infringer.
- The availability of lost profits.
1. The strength of the infringement case.
In 2008 the court that handles all patent appeals reaffirmed that design patent infringement is to be evaluated from the viewpoint of the ordinary observer who is familiar with the prior art, who then compares the accused product to the patented design. If that ordinary observer determines that the patented design and the accused design are deceptively similar, then infringement exists.
2. The prior art.
Prior art is important not only to the validity of the design patent, but also for the infringement analysis as explained in the preceding section. We work with our clients and independent experts in locating the most relevant prior art.
3. The value of the design to the infringer.
To what extent is the infringing design a part of the infringer’s advertisements, both in pictures and in words? Is the infringer advertising a new and improved “look” for a product, along with a picture of the product, or does the infringer mention only improved functional features? How does the advertising impact a potential infringement award?
4. The value of the design to the customer.
Does the customer or consumer care about the design? Are there comments on social media about the design? In some situations, such as components of a product, the design is visible only during the manufacturing process but is not visible in the finished product. This also impacts the potential infringement award.
5. The identity of the infringer.
We consider the infringer, how long the infringement has occurred, and the likelihood that the infringer will be able to pay an infringement award.
6. The availability of lost profits.
The design patent owner is entitled to an award of damages adequate to compensate for infringement, but in no event less than a reasonable royalty. We evaluate the components of a reasonable royalty computation as well as the potential for a lost profits award when the patent owner is, or has been, competing with the infringer.
Our firm may have more one or more design patent infringement cases at the trial or appellate level at any time. Accordingly, this should not be construed as applicable to any of the firm’s pending cases.