Reprinted with permission from the October 19, 2012 issue of The Recorder. (c)2012 ALM Media Properties LLC. Further duplication without permission is prohibited. All Rights Reserved.
Product designs that capture the attention of the marketplace — not for their utility, but due to creativity, innovation or fashion cachet — can be hugely valuable assets. Companies across a wide range of industries can implement creative legal strategies to protect their product designs, and should develop a strategy well before the product is introduced to the marketplace. Protection is not without its challenges, though, as the law imposes limits on what can be protected and competitors routinely flirt with the boundaries of acceptable "inspiration."
There are three primary sources of protection for nonfunctional product designs: trade dress, copyright and design patents. As discussed below, each has its unique requirements, benefits and challenges, and each serves a specific purpose.
Of the three, trade dress protection offers the longest-lasting protection, but likely is the most difficult to establish. Under the Lanham Act, 15 U.S.C. §1051 et seq., the design of a product is protectable so long as the claimed trade dress design is not functional, and the trade dress is a clearly articulated design or combination of elements that has acquired distinctiveness through secondary meaning. Trade dress is distinctive when consumers identify the trade dress with a particular source. Courts consider numerous factors to determine whether a design has acquired distinctiveness, including how long the design has been used, efforts to promote a connection between the design and the company that offers the product, and purchasers' association of the design to a single company. It generally requires substantial time and/or publicity for a company to establish that its product design has acquired distinctiveness, but there have been exceptions to that general rule. If the claimed design is or was ever claimed in a utility patent, it will be very difficult to establish that it is nonfunctional and entitled to trade dress protection.
Trade dress protection allows a company to prevent third parties from using a product design that is likely to cause confusion in the marketplace. Where the trade dress is famous, the Lanham Act also allows the owner to prevent third parties from diluting its design. Dilution does not require a showing of consumer confusion, but prevents use of designs that either blur or tarnish a company's protected design. Like a trademark, trade dress can be federally registered, but does not need to be registered in order to be protected by the courts. There is no requirement that the trade dress design be creative, novel or nonobvious, and there is no consideration of originality or "prior art." Typical challenges for a company trying to protect and enforce its trade dress pertain to how the design is defined, whether it is functional and whether it has attained secondary meaning and is associated with a single company.
Companies interested in securing trade dress protection for their product designs should give careful thought to how they will market the product in a manner to create an association between the product design and the company even before the product is launched to establish protection as early as possible and maximize potential protection. While "look for" advertising is no longer required to establish secondary meaning, it is a classic tool for establishing market awareness.
Trade dress protection can be for a product's entire design (as with the registered design of a Coke bottle or the registered design of a Volkswagen Bug or Beetle), or an aspect of the design. For example, in a recent highly publicized case, the U.S. Court of Appeals Second Circuit on Sept. 5 held that a single color can be protectable in the fashion industry, overturning the lower court's conclusion that color could never be nonfunctional for fashion because of its aesthetic quality for fashion. In Christian Louboutin v. Yves Saint Laurent Am. Holding, 2012 U.S. App. LEXIS 18663 (2012), the Second Circuit considered whether the red lacquer outsoles of high-fashion women's shoes could be protectable. Plaintiff Louboutin had obtained a federal registration for its lacquered red soles in January 2008 and in April 2011, sued defendant YSL to prevent its sale of monochrome red shoes with a red sole. The district court in August 2011 denied Louboutin's request for an injunction, holding that a single color could not be protectable in the fashion industry because it was aesthetically functional. The Second Circuit held that, under Qualitex v. Jacobson Products, that a single color could qualify for protection, even for goods in the fashion industry. While the Second Circuit found that Louboutin could properly claim exclusivity as to lacquered red soles, the court limited Louboutin's rights and its registration to use of contrasting red lacquered outsoles and held that YSL could proceed with the sale of monochrome red shoes that included a red outsole.
In contrast to trade dress protection, copyright protection does not require a showing of acquired distinctiveness or of a likelihood of consumer confusion or dilution. Rather, the Copyright Act, 17 U.S.C. §101 et seq, protects creative designs from copying by others, and also grants the copyright owner exclusive rights to create derivative works and to control distribution and importation. Significantly, however, the Copyright Act does not extend protection to "useful articles" or design elements that are functional, and also may be limited by the doctrines of scenes a faire or merger. As a result, while copyright law protects designs on fabric, it typically will not protect the design of a dress or other fashion item, no matter how creative or iconic it is. Because of the limitations on copyright protection in the fashion industry in particular, the industry has been lobbying for new legislation granting protection for fashion designs for a limited period of time. Most recently, the Senate Judiciary Committee on Sept. 20 approved a bill that was introduced 10 days earlier (S. 3523), the Innovative Design Protection Act of 2012. That bill would extend three years protection to original articles of apparel. See also H.R. 2511 (introduced July 13, 2011).
If copyright protection is available, however, it can be very powerful. Copyright protection is available immediately upon creation of the design, and lasts for the life of the author, plus 70 years, or for 120 years from creation if the work qualifies as a "work made for hire." Registration is not required for protection to exist, although is necessary to bring an infringement action for a U.S. work. While registration is not required, it is relatively easy to obtain and inexpensive, and if the design is registered before the alleged infringement occurs, the copyright owner can claim attorney fees and statutory damages - powerful remedies in the event of infringement.
The Copyright Act also may provide companies with a means to prevent the importation and sale of genuine goods that are lawfully manufactured abroad, but which make their way into the U.S. notwithstanding efforts of the company to control its market channels. In Omega v. Costco Wholesale, plaintiff relied on a copyrighted design on its watches to prevent the sale in the U.S. of watches lawfully made outside of the U.S. and imported into the U.S. The U.S. Supreme Court in 2010 considered the case, but ultimately failed to resolve the question of whether the "first sale doctrine" applied to foreign made goods due to a 4-4 tie, and sent the case back to the district court. (On Nov. 9, 2011, Judge Terry Hatter Jr. of the Eastern District of California granted Costco's motion for summary judgment on the grounds that Omega had misused its copyright, and that decision is on appeal.) The Supreme Court is, however, considering another "first sale doctrine" case involving the importation of authentic goods. The case is Kirksaeng v. John Wiley & Sons, 11-697.
Along with trade dress and copyright protection, design patent protection is taking on an increased role in product design, particularly since the Federal Circuit's decision four years ago in Egyptian Goddess v. Swisa, 543 F.3d 665 (Fed. Cir. 2008). Since Egyptian Goddess, there has been an increase in the number of patent design applications and claims of design patent infringement, underscoring the potential significant benefits of this additional protection tool. Design patent protection is used for products across a wide range of industries, from the design of cookware and pharmaceuticals, to the design of fashion items, consumer electronics, graphical user interfaces or "screen shots" of software programs, and computer-generated icons. For example, in an action brought before the International Trade Commission, the makers of Crocs sandals was able to prevent the importation of competing products that too closely resembled its design patents. Crocs v. Int'l Trade Comm'n., 598 F.3d 1294 (Fed. Cir. 2010).
Like trade dress and copyright protection, design patent protection is not available for functional aspects of a product's design. Rather, design patents protect the ornamental design aspects of an article of manufacture, including surface ornamentation, not the article itself. Thus, design patents for articles of manufacture consist of the visual characteristics embodied in or applied to an article. Compared to trade dress and copyright protection, design protection is short-lived. Design patents last for only 14 years. But since they do not require a finding of acquired distinctiveness or even be in use, design patents can provide valuable protection for a product design while a company is developing its product and working to establish marketplace awareness for its design.
While there is no requirement to establish "acquired distinctiveness" for a design patent, the claimed subject matter of a design patent, like that of a utility patent, must be novel and nonobvious. A design patent will be invalidated if the design is not new or, stated another way, if it is "anticipated" by a prior art reference. Even if it is not anticipated by a single reference, it still may be invalidated if the claimed design would have been obvious to a designer of ordinary skill in the field at the time the design was made. Obviousness can be decided by considering more than one item of prior art.
A design patent owner can prevent others from using a design when, "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." (See Egyptian Goddess.) In other words, the accused article must "embod[y] the patented design or any colorable imitation thereof."
Given the variety of protection options available, their varying requirements and benefits, there are many creative strategies available to protect product designs. The earlier strategies are considered and implemented, the greater their chances of success. At the same time, those involved in design development need to be mindful of the rights of others to avoid or at least reduce the risk of infringement claims.
Carla B. Oakley is a partner in Morgan, Lewis & Bockius' intellectual property practice and is co-leader of the trademark/copyright/advertising practice in Northern California. She is resident in the firm's San Francisco and Palo Alto offices and can be reached firstname.lastname@example.org. Brett A. Lovejoy, Ph.D., is a partner in Morgan Lewis' IP practice and is also resident in both San Francisco and Palo Alto. He can be reached at email@example.com.