In the article we circulated a couple of weeks ago, (“Should Apple be entitled to all of the profits Samsung made on its Galaxy smartphones?“), we discussed how the Supreme Court is considering ‎whether to ‎affirm the Apple v. Samsung case and grant Apple all of the profits Samsung made on the infringing ‎Galaxy smartphones, ‎or reverse the case and limit the award to the profits that resulted from the ‎design of the exterior casing and icons ‎shown in Apple’s design patents. The legal issue to be decided is whether the language of the ‎design patent statute ‎requiring the patentee to be awarded the total profits “‎made from the ‎article of manufacture to which such design has been applied” truly requires the award of all profits ‎even though the design patents depict only the ‎exterior casing and icons and did not cover the ‎internal workings of the infringing ‎smartphones. Another possibility is that the Court will award the ‎profits attributable to sale of “the ‎article” as decided by the jury, in this case the entire phone. This ‎would facilitate more limited awards ‎in future cases but sustain the $400 million award to Apple in the ‎present case.‎

At oral argument the justices repeatedly asked about how they could provide guidance for ‎future ‎juries faced with design patents showing an exterior that is truly unique and valuable, like ‎the ‎VW Beetle, but which might have been sketched on the back of a napkin in a moment of ‎inspiration. ‎While an award of all profits could apply to such simple items from the past like saddles, hats and ‎socks, should the same be true with modern products stuffed with the latest technology that is not ‎visible to the prospective purchaser and does not appear ‎in the drawings of a design patent? ‎

What If Apple v. Samsung Is Reversed?

We ended our first discussion with the conclusion that however this case is decided, it could ‎and ‎likely would be of great significance in future design patent cases. To that, one reader queried: “If ‎the ‎case is reversed, and the award is limited to profits attributable to the exterior appearance ‎shown ‎in the design patents, won’t that relegate design patents to their rightful place as a seldom-used ‎remedy ‎for artistic designs?” We emphatically disagree with that contention. If the case is affirmed, ‎this will ‎cement design patents as providing a remedy like no other. If the case is ‎reversed or the Court rules ‎that the question of what constitutes “the article” is to be a jury ‎question, design patents still will play a critical and ‎significant role in the protection of technology, both ‎as to so-called “artistic designs” and as to the ‎useful features of inventions. Permit us to explain why.‎

It Is More Difficult Than Ever to Assert Functionality as a Defense to Design Patent Infringement.

There are several defenses that are asserted against design patents that are not available for ‎utility ‎patents. Perhaps the best known defense is that the design is functional, and therefore a ‎design ‎patent depicting those features is invalid since design patents are to be directed to ‎‎“ornamental ‎features.” However, last year, in the ‎case of Ethicon v. Covidien involving ultrasonic ‎surgical shears used to cut tissue and blood vessels, the Federal Circuit ruled that to prevail on a functionality ‎defense, the defendant ‎must meet a “stringent” measure of proof. This decision has been said to emaciate the defense that a design patent is attempting to protect purely functional features.

Some design innovators, such as ‎Tim Leatherman, have, instead of relying on design patents, relied upon common law trade ‎dress or trademark registrations to protect their designs. In Leatherman v. Cooper Tools, ‎the trade dress in Leatherman’s multi-tool was found to be functional and therefore unworthy of trade dress protection. In an ‎Apple v. Samsung decision of last year, Apple’s trademark registration in its icon design was found to ‎be functional and therefore invalid, while the design patents directed to the same features were determined to be valid. Thankfully ‎for Apple, it obtained both trademark registrations and design patents so the judgment for design patent ‎infringement was sustained even though $382 million was lopped off as a result of ‎the court’s rejection of the trade dress claims.

It Is Now Easier to Prove Infringement of Design Patents.

The Federal Circuit has also made it easier for design patentees to prove infringement. In order to be found liable for infringement of a utility patent, the ‎patentee ‎needs to prove that the accused design includes all of the features found in a claim that describes what distinguishes the invention from the prior art. Proof of infringement of a design patent ‎is ‎not nearly so onerous. The design patent statute provides that infringement exists when someone applies a ‎colorable imitation of a design to an article of manufacture. In the case Egyptian Goddess v. Swisa, a unanimous 2008 decision by the entire ‎Federal Circuit (called an en banc decision), the Circuit ‎decided that whether something is substantially the same should be decided from the perspective of an ordinary observer, ‎and not by an expert in the field to which the design pertains. This has made it significantly easier for ‎design patent plaintiffs to prevail in asserting infringement.

Also, utility patent cases are often ‎dismissed before cases get to trial where features the court has required be present ‎for infringement are found missing in the accused design. In design patent cases, the courts have ‎greater latitude in permitting cases to go to trial so the jury  is permitted to decide just what the design patent ‎covers. Infringement cases are easy enough for a plaintiff to prevail when a party is accused of ‎purloining ‎another’s design, but giving the jury more discretion has and will continue to result in more ‎awards in favor of the patent owner.

Design Patents Are Far Less Expensive to Obtain and Maintain.

Other advantages of design patents over utility patents have always been in play. Instead of having ‎to ‎explain in great detail how one “of ordinary skill in the art” would fabricate the invention of a ‎utility ‎patent, a design patent merely needs to include figures depicting the ornamental features. ‎Design ‎patents are also usually easier to obtain than utility patents without having to undergo the ‎extensive ‎back and forth between the PTO and the applicant’s attorney. This results in design ‎patents often being ‎obtainable for no more than a few thousand dollars, as opposed to several ‎multiples of that for ‎utility patents. Moreover, given the limited review by the PTO, design patents ‎typically will issue in less than a year instead of the two or three years ‎required for utility patents. ‎Nor do design patents require the payment of maintenance fees during ‎the life of the patent, as is required with utility patents, which have fees that increase dramatically ‎over the life of the patent. ‎

Finally, those who are familiar with pursuing foreign protection for their utility patents know how expensive that can be. But just last year, applicants for U.S. design patents became eligible ‎to make use of the Hague Agreement, which permits a single filing in the U.S. Patent and Trademark ‎Office to obtain coverage in over 65 other countries, including most of the industrialized countries of ‎the world.‎

Don’t Wait and Let Your Competition Get a Prior Filing Date.

What is the significance of the foregoing? The significance is that, regardless of whether the Supreme Court permits Apple to keep all of Samsung’s profits, or something less than that, design patents are every bit as valuable and often a much better bargain than utility patents. Because of this, design and technology ‎companies ‎should not wait until a decision in the Apple case to file design patents. Remember ‎that the ‎U.S. patent system changed from a “first to invent” priority system to one awarding ‎priority ‎to the “first to file.” Thus, a Supreme Court decision for Apple, or one seen as ‎being ‎favorable to design patents, will result in an immediate uptick in the number of ‎design ‎patent filings. Those filing now, instead of waiting for the decision, will have priority. And in the event of a reversal, or a decision seen ‎as ‎deleterious to design patents, design patentees will still have the benefit of the advantages set ‎forth ‎above.‎

So will the Apple v. Samsung decision be an important one? Absolutely. But if the case is reversed, ‎will ‎this render design patents unworthy of the time and expense of filing? Absolutely not. And ‎should ‎you wait until the case is decided before filing design patent applications? You do so at your ‎peril ‎because your competitors are not waiting to see what happens in the case, and they will have ‎priority if you decide to wait to hear how the Supreme Court rules. ‎