Must All Good Things Come to an End, Or Can You Obtain a Perpetual Design Patent?

Many intellectual property rights peacefully coexist because they apply to distinct aspects of a product. Issues can arise when intellectual property rights that expire and intellectual property rights that do not expire protect the same or overlapping features of the same product. One example is design patents and trade dress rights, both of which apply to non-functional ornamental features.

During the life of a patent, consumers may start to associate a claimed invention with the patent owner. The patent owner may assert the association provides trade dress rights that continue after the patent expires. Allowing patent owners to use a period of patent exclusivity to acquire potentially perpetual trade dress rights may provide the equivalent of a design patent that never expires.

The Supreme Court has repeatedly held that the patent system is based on the premise that the public is free to use an invention after its patent expires. Courts most often apply this rule to functional inventions claimed in utility patents. Many cases allow patent owners to use the period of exclusivity provided by a design patent to obtain trade dress rights in the same design—thereby preventing competitors from using the design even after the patent expires. The cases that allow simultaneous or successive acquisition of design patent and trade dress rights do not, however, provide rigorous justification for this result.

This article suggests that both trademark and patent law would benefit from clarifying the interaction between design patents and trade dress in such situations.

Courts Describe Expiration as a Critical Part of the Patent System

The Supreme Court and the U.S. Court of Appeals for the Federal Circuit have repeatedly held that the public is free to practice inventions claimed in expired patents. More than a century ago, the Supreme Court stated:

“It is self-evident that on the expiration of a patent the monopoly created by it ceases to exist, and the right to make the thing formerly covered by the patent becomes public property. It is upon this condition that the patent is granted.”

Singer Mfg. Co. v. June Mfg. Co., 163 U.S. 169, 185 (1896); see Brulotte v. Thys Co., 379 U.S. 29, 30-31 (1964) (“these rights become public property once the [patent term] expires”).

The Supreme Court observed that, “[f]or almost 100 years it has been well established that in the case of an expired patent, the federal patent laws do create a federal right to ‘copy and use.’” Bonito Boats, Inc. v. Thunder Craft Boats, Inc., 489 U.S. 141, 165 (1989) (emphasis in original). More recently, the Supreme Court reiterated that, “when the patent expires, the patentee’s prerogatives expire too, and the right to make or use the article, free from all restriction, passes to the public.”  Kimble v. Marvel Entertainment, LLC, 576 U.S. 446, 451 (2015).

The Federal Circuit similarly described patents as based on “the core principle that, in exchange for a patent, an inventor must fully disclose his invention and promise to permit free use of it at the end of his patent term.” Gilead Sciences, Inc. v. Natco Pharma Ltd., 753 F.3d 1208, 1212 (Fed. Cir. 2014).

The Federal Circuit held that enforcing trade dress rights that are “defined to be essentially coextensive with, and in fact broader than,” a utility patent claim would “effectively extend the life of the patent.” Elmer v. ICC Fabricating, Inc., 67 F.3d 1571, 1580 (Fed. Cir. 1995). The Federal Circuit was concerned that doing so would “frustrate” competitors’ right to “‘copy and use’ the invention after the patent expires.” Id.

Some Cases Suggest Trademark Law Cannot Extend the Life of a Design Patent

Long ago, the Supreme Court addressed a situation where “a design patent was taken out to cover the pillow-shaped form” of shredded wheat cereal and held that, “upon expiration of the patents, the form, as well as the name, was dedicated to the public.” Kellogg Co. v. National Biscuit Co., 305 U.S. 111, 119-20 (1938).

A few years later, the Supreme Court elaborated that “any attempted reservation or continuation in the patentee or those claiming under him of the patent monopoly, after the patent expires, whatever the legal device employed, runs counter to the policy and purpose of the patent laws.” Scott Paper Co. v. Marcalus Mfg. Co., 326 U.S. 249, 256 (1945) (emphases added).

The Supreme Court explained that patent owners cannot use public association between the patent owner and a patented product to acquire trademark rights that exclude the public from practicing the invention after patent expiration.

“By the force of the patent laws not only is the invention of a patent dedicated to the public upon its expiration, but the public thereby becomes entitled to share in the good will which the patentee has built up in the patented article or product through the enjoyment of his patent monopoly. Hence we have held that the patentee may not exclude the public from participating in that good will or secure, to any extent, a continuation of his monopoly by resorting to the trademark law and registering as a trademark any particular descriptive matter appearing in the specifications, drawings or claims of the expired patent, whether or not such matter describes essential elements of the invention or claims.”

Id. (emphases added).

More recently, the Supreme Court held that utility patents can be incompatible with trade dress rights, regardless of expiration. “A utility patent is strong evidence that the features therein claimed are functional” and not eligible for trade dress protection. TraFfix Devices, Inc. v. Marketing Displays, Inc., 532 U.S. 23, 29-30 (2001). The Supreme Court did not categorically preclude acquiring trade dress rights in ornamental aspects of an invention claimed in a utility patent. Rather, the court warned that “one who seeks to establish trade dress protection must carry the heavy burden of showing that the feature is not functional, for instance by showing that it is merely an ornamental, incidental, or arbitrary aspect of the device.” Id. at 29-30.

At least one district court expressly held that designs fall into the public domain after a patent expires. “When a design patent expires, or when a product’s trade dress is [otherwise unprotectable], the trade dress of the subject goods is considered to be in the public domain and may be freely copied on a universal basis.” Eldon Indus. v. Rubbermaid, Inc., 735 F. Supp. 786, 830 n.5 (N.D. Ill. 1990) (report and recommendation attached to district court opinion).

Other Cases Suggest Trademark Protection Can Extend Exclusive Rights in a Design After a Design Patent Expires

The Court of Customs and Patent Appeals (the predecessor to the Federal Circuit) took the opposite approach. It stated that, if a design were to acquire secondary meaning before a patent were filed, no “rule in rhyme or reason would preclude the patent grant or inhibit the concurrent enjoyment of the rights appertaining to both the design patent and the trademark … .” Application of Mogen David Wine Corp., 328 F.2d 925, 930 (C.C.P.A. 1964). The court was then “unable to divine any reason in law or logic in support of a distinction between the ensuing legal consequences predicated upon whether a … trademark registration issued prior or subsequent to the grant of a valid and subsisting design patent … .” Id.

The CCPA dismissed any concerns regarding after-arising trade dress right extending design patent protection. The court stated that allowing trademark rights to “continue beyond the expiration of a design patent, do[es] not ‘extend’ the patent monopoly” because, “[w]hen the patent monopoly ends, it ends” and “[t]he trademark rights do not extend it.” Id. That argument is not particularly satisfying because it does not address the practical effects when the scope of the design patent and trade dress closely overlap.

The CCPA also asserted that “[w]e know of no provision of patent law, statutory or otherwise, that guarantees to anyone an absolute right to copy the subject matter of any expired patent.” Id. The CCPA did not address the Supreme Court opinions in Kellogg, Scott Paper, or Singer that stated such a right is a premise of the patent system (and the CCPA did not have the benefit of the more recent Supreme Court or Federal Circuit decisions discussed above).

A few years later, the CCPA did address those Supreme Court cases, albeit by focusing on functionality concerns rather than the public’s right to practice expired patents. The CCPA expressly addressed whether allowing a trademark on subject matter in an expired design patent would be “inconsistent with the right of others under the terms of the patent grant to make fair use of the ornamental design … after the expiration of the patent … .” Application of Honeywell, Inc., 497 F.2d 1344, 1346 (C.C.P.A. 1974). The appeal arose because the U.S. Patent and Trademark Office (USPTO) had rejected a registration on the grounds “it would serve, in effect, to extend the protection accorded the patented design contrary to the purpose and intent of the patent law.” Id.

The CCPA disagreed and held the government’s analysis “failed to draw a crucial distinction between functional subject matter disclosed in utility patents and subject matter disclosed in design patents, which may or may not be functional, in the context of their relationship with trademarks.” Id. at 1347. The CCPA held that “the Kellogg, Singer and Scott Paper decisions” do not apply where the “trademark rights were sought for non-functional features which were the subject matter of a design patent.” Id. at 1348. While some aspects of those decisions certainly addressed issues of functionality, the CCPA did not address the policy statements that competitors are supposed to be able to use a claimed invention after the patent expires.

The CCPA also characterized its earlier decision in Mogen David as establishing a “clear distinction between the underlying bases of the federal trademark and design patent laws.” Id. The court stated that “design patent laws were created to encourage the invention of ornamental designs” while “trademark laws, which are independent in origin from the design patent laws, seek to prevent the public from encountering confusion, mistake, and deception … .” Id. The CCPA did not explain why that analysis would not apply with equal force to utility patents, which would seem to be at least as independent of the trademark laws.

More recently, the Sixth Circuit expressly reached the conclusion that “[t]he existence of [a] design patent does not preclude the same product from protection as a trademark under the Lanham Act either simultaneously or successively.” Fuji Kogyo Co., Ltd. v. Pac. Bay Int’l, Inc., 461 F.3d 675, 683 (6th Cir. 2006).

The Fuji Kogyo opinion cited a Seventh Circuit decision that had observed patent protection and trade dress protection serve different purposes and do not conflict, but which did not expressly address whether trademark law could be used to prevent the subject matter of expired patents from falling into the public domain. See Kohler Co. v. Moen Inc., 12 F.3d 632, 636-42 (7th Cir. 1993). A dissent in Kohler strenuously argued that allowing trademark law to extend the life of a patent would be improper. “The Supreme Court has made clear that the patent monopoly which may be secured by obtaining a design patent on a product may not be indefinitely extended through the use of a federal trademark on the product configuration.” Kohler, 12 F.3d at 644-45 (Cudahy, J., dissenting). The dissent further asserted that “there is no basis for treating the subject matter of design and utility patents differently: if functional matter not protected by a utility patent is available for all to copy, then it follows that ornamental or aesthetic designs not protected by design patents are also free for everyone to copy.” Id. at 648.

The Trademark Trial and Appeal Board has stated that “the fact that [a design] had been the subject of a design patent” indicates the design is ornamental, not functional, and does not preclude registration. In re Honeywell Inc., 8 U.S.P.Q.2d 1600, 1601, 1988 TTAB LEXIS 38, at *12 (T.T.A.B. 1988) (addressing whether the design was ineligible for trademark protection for being functional). This suggests the USPTO does not consider the existence of a design patent precludes acquiring trademark protection on the same subject matter.

Best Practices

As discussed above, the Supreme Court and Federal Circuit have repeatedly held that subject matter claimed in a patent falls into the public domain when the patent expires. At the same time, numerous decisions, perhaps most notably from the USPTO, have held that trade dress rights can protect designs after design patents expire (and perhaps can be acquired during the period of patent-created exclusivity). Courts could help promote consistency and predictability by expressly addressing and resolving this tension.

In the meantime, brand owners should continue to seek and obtain a variety of rights of varying scope to maximize their current protection and hedge against potential changes in the legal landscape. Particularly where design patents claim or have claimed aspects of potential trade dress, rights holders should consider seeking trademark protection on combinations of names, fonts, colors, and aspects of designs that are not expressly claimed in the design patents or that differ in some respects from the claimed designs.

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Author: dndavis
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