Telebrands Corp. v. Del Laboratories, Inc., 2011 U.S. Dist. LEXIS 101423 (S.D.N.Y. Sept. 8, 2011)
Motion for Summary Judgment on the Issue of Functionality – Denied
Design Patent: D596,802
Design: Foot Micro File
CASE: Defendant contended the design was functional and could not be protected by a design patent. Plaintiff responded that the generally egg-shaped design was non-functional.
The parties agreed the functionality inquiry was whether the feature is “essential to the use or purpose of the article or if it affects the cost or quality of the article" (Inwood Labs., Inc. v. Ives Labs., Inc., 456 U.S. 844, 851 (1982)) and that the court should apply the Morton-Norwich factors to aid in the analysis. These factors are: “(1) the existence of a utility patent disclosing the utilitarian advantages of the design; (2) advertising materials in which the originator of the design touts the design’s utilitarian advantages; (3) the availability to competitors of functionally equivalent designs; and (4) facts indicating that the design results in a comparatively simple or cheap method of manufacturing the product."
The court applied the factors and found that Defendant satisfied its initial burden of establishing that the design features were functional. However, Plaintiff provided evidence of the following facts that precluded the court from granting summary judgment: foot files that capture skin shavings are available on the market in various shapes, including in symmetrical and asymmetrical bean shapes, foot shapes, spheroids, flat-topped three-dimensional ovals, and bone or wand shapes; (2) when designing its foot file, Defendant priced four product configurations and elected to produce an ovoid design that was more expensive on a per-unit basis than either a three-dimensional circular design or an ovoid design that opened via a side hinge; (3) the cost of the ovoid mold for the accused design was the same as the cost of the mold for non-ovoid prototypes; and (4) Defendant considered putting a notch on the top of its foot file to provide for a better grip but abandoned that feature for aesthetic purposes.
The issue of functionality has several unresolved areas, one of which is the standard the court should use. Although the parties in this case agreed to the Inwood Labs standard for functionality and application of the Morton-Norwich factors, the proper standard for functionality in a design patent case is not yet settled. Neither Inwood Labs nor Morton-Norwich involved a design patent (they involved a trademark and trade dress). The only statement from the United States Supreme Court in the specific context of design patents is "[t]o qualify for [design patent] protection, a design must present an aesthetically pleasing appearance that is not dictated by function alone, and must satisfy the other criteria of patentability." Bonito Boats v. Thunder Craft Boats, 489 U.S. 141, 147 (1989).
Federal Circuit decisions are inconsistent on the point. Cases that consider Morton-Norwich type factors are Berry Sterling Corp. v. Prescor Plastics, Inc., 122 F.3d 1452, 1456 (Fed. Cir. 1997) and PHG Techs., LLC v. St. John Cos., 469 F.3d 1361 (Fed. Cir. 2006). The Inwood Labs standard for functionality was quoted in Amini Innovation Corp. v. Anthony California, Inc., 439 F.3d 1365 (Fed. Cir. 2006). However, the Federal Circuit’s most recent case involving functionality, Richardson v. Stanley Works, Inc., 597 F.3d 1288 (Fed. Cir. 2010), does not mention either the Morton-Norwich factors or the Inwood Labs standard (although the district court opinion did cite Berry Sterling, supra, for the application of the Morton-Norwich type factors). Rather, the court states that the design had certain elements that were “driven purely by utility" and the court cites L.A. Gear, Inc. v. Thom McAn Shoe Co., 988 F.2d 1117, 1123 (Fed.Cir.1993) for the proposition that design patent scope does not extend to functional elements. L.A. Gear uses the “dictated by function" standard.
Those arguing for a stricter “dictated by function" standard cite Bonito Boats and point out that the policies underlying trademark/trade dress law are different from those underlying design patent law. The primary purpose of the functionality doctrine in trademark/trade dress law is to preserve competition since the intellectual property right is potentially perpetual. In contrast, the primary purpose of the functionality doctrine in design patent law is to make sure that only novel and non-obvious ornamental design choices are being protected, i.e., choices that are not dictated solely by function. Preservation of competition is not a concern because the design patent right by its very nature blocks competition for a limited period of time.
Those arguing for the Inwood Labs standard and the Morton-Norwich type factors listed in Berry Sterling, supra, argue that cost, quality, and other factors can indicate that a particular design resulted from factors other than pure aesthetic design choices. It also may make a difference whether the functionality issue is being considered in the invalidity context or just to factor out portions of the design during claim construction. The issue likely will be settled in some future en banc Federal Circuit or Supreme Court case.
In the meantime, plaintiffs and defendants should be prepared to offer proof under whatever standard the district court considers appropriate. Since alternative designs play a role in both standards, alternative designs will continue to be important. And this case points out that it is also important to focus on and develop cost and quality issues as well.