Dennis Crouch, a professor at the University of Missouri Law School and the founder of the leading patent blog patentlyo.com, has posted a draft article discussing design patents. Mr. Crouch identifies recent trends involving various types of IP protection, and discusses what those trends mean for the scope of various forms of IP protection. I highly recommend reading the article (available here), particularly if you’re interested in the interplay between trade dress protection and design patents.
Mr. Crouch points out the important “gap-filling” role that design patents can play in conjunction with trade dress protection. As the Supreme Court made clear in Wal-Mart Stores v. Samara Bros. Inc., 529 U.S. 205 (2000), product configuration trade dress can never be inherently distinctive. Thus, someone trying to protect an ornamental design of a product as trade dress must demonstrate acquired distinctiveness—namely, that consumers identify the ornamental design as coming from a single source. This is obviously impossible when the product is not yet publicly known or available. In fact, it may take several years to gather proof of acquired distinctiveness, such as consumer surveys or advertising expenditures. Meanwhile, competitors can copy the nascent trade dress with impunity, which may prevent the trade dress from ever acquiring distinctiveness.
Because a design patent can be pursued on a product configuration before the product is even released (and usually issues more quickly than trade dress protection even where the latter is available), it can play a valuable role in the early days of the life of a design. What’s more, the design patent allows room for the design room to acquire distinctiveness by inhibiting others from copying the design.
Mr. Crouch argues that, from a transactional point of view, design patents may be more convenient than trade dress protection as well. Where protectable trade dress is the subject of a license or assignment, the parties must avoid “naked licensing”—a situation where a trademark (or trade dress) is transferred without its accompanying good will. A naked license can arise from subtle drafting issues with the transfer, and can be fatal to trademark or trade dress rights. The bottom line is that licensing or assigning trade dress rights can be a tricky affair fraught with traps. Design patent rights, on the other hand, can be easily and efficiently transferred.
Mr. Crouch’s research yields statistics that may surprise those used to the rigorous examination that utility patents undergo. For example, design patents enjoy an allowance rate of over 90% (compared with 44% for utility patents). In Mr. Crouch’s view, though issued patents are entitled to a presumption of validity, “the U.S. design patent examination system is operating as a de facto registration system rather than as one based on a true examination.” In this, he sees an opportunity for owners of ornamental designs: design patents may provide evidence of non-functionality. Under the Traffix doctrine, the existence of a utility patent covering a particular design creates a presumption that the patented design is functional. Under Mr. Crouch’s “anti-Traffix” doctrine, a prior design patent covering a design provides evidence (albeit non-conclusive) that the design is not functional.
In one sense, Mr. Crouch's statements seem at odds with one another. On the one hand, he argues that design patents are registered without rigorous examination, similar to copyrights. Presumably, that means design patent applications are not being thoroughly examined for functionality. On the other hand, the anti-Traffix doctrine allows design patents to serve as evidence of non-functionality. But why would courts assume the non-functionality of a design that was never truly examined for functionality?
Mr. Crouch argues that, even though the scope of design patents has not expanded at the pace of trademarks, trade dress, or copyright law, design patents still play an important role in limiting the expansion of trade dress rights. The functionality standard for trade dress protection is stricter than that for design patents. Accordingly, the relative ease of obtaining design patent protection may offer justification for courts limiting the expansion of trade dress protection, since design patent protection would still be available. This would have the long-term effect of reducing monopoly power, since a design patent expires in 14 years whereas a trade dress registration may exist in perpetuity. Thus, by shifting the type of protection we give to product designs, it may be possible to mute the anti-competitive effect of the protection.