Doctrine of Inurement Does Not Save Design Patent in IPR Proceeding

6686163_sThere are precious few opportunities to be able to write about the Doctrine of Inurement in inter partes review proceedings (or otherwise, for that matter). So, we take the opportunity here to consider the doctrine, in a design patent context, with the Board’s decision in Sensio, Inc. v. Select Brands, Inc., IPR2013-00580. In Sensio, the Board rejected Patent Owner’s attempt to antedate 102(a) prior art under the Doctrine of Inurement, finding that insufficient evidence supported a finding that the work of a third party inured to the benefit of Patent Owner.

More specifically, Patent Owner argued that it had communicated the design of the subject matter later claimed in the subject patent (design for a multiple-crock buffet server) to a third party for manufacture of a prototype. The first prototype was then manufactured and sent to Patent Owner by the third party months prior to the date of the prior art references relied upon in this challenge. There were no design changes in taking the prototype to the present day commercial model. Decision at 6-7. Patent Owner, assuming conception was established by photographs of the prototype and business records, argued that reduction to practice was achieved prior to the date of the prior art, as evidenced by several commercial product description documents which antedate the prior art by a few months. Id. at 7-8.

Petitioner responded by rebutting Patent Owner’s argument the doctrine of inurement applied (that acts by others working explicitly or implicitly at the inventor’s request will inure to the inventor’s benefit). The first requirement of inurement is that the inventor must have conceived of the invention prior to involving the third party. Petitioner argued: (1) because a third party (rather than the inventors) built the prototypes, there was no reduction to practice; (2) Patent Owner did not show that the third party building the prototypes inures to Patent Owner’s benefit; and (3) the photographs of the prototype produced by the third party were insufficiently clear to establish conception of the design by the inventors prior to involvement of the third party. Id. at 8-9.

After rejecting Patent Owner’s argument that the foundational case law of the doctrine of inurement does not apply to design patents (only to utility patents), the Board narrowed the key issue to whether the third-party-built prototypes inure to Patent Owner’s benefit.  Id. at 10.  The Board began by rejecting Patent Owner’s assumption that conception had taken place, and stated that Patent Owner had not, in fact, shown that conception of the claim design happened before the prior art date. The Board based this finding on a lack of corroboration of the inventor’s testimony regarding conception.  Id.at 12-13.  Patent Owner’s submission of various business records and product descriptions were inadequate, as they did not address the claimed ornamental design and focused more on the commercial product and its technical specifications.  Further, the Board weighed the fact there was no evidence of record which showed correspondence between Patent Owner and third party prior to production of the design prototype.  Id.  at 14.

Accordingly, the Board found that Patent Owner had not adequately shown that it invented the claimed design prior to the prior art date, and allowed the references at issue as prior art under 102(a).  Id. at 14.

IPR Obviousness Challenge of Design Patent Denied

7981714_sThrough two years of inter partes review practice, only 8 petitions were filed that were directed to design patents (out of 1773 total petitions). Given this limited number of petitions, lessons are going to be difficult to learn regarding the treatment of design patents in IPR proceedings. As such, we take a look at a failed petition, filed in Dorman Products v. Paccar, IPR2014-00555, wherein the Board had to consider the differences between functionality, pursuant to 35 USC § 171 and obviousness, pursuant to 35 USC § 103.

In determining whether a design patent claim is obvious, the parties agreed that the focus should be on the visual impression of the claimed design, as a whole. Order at 4. That is where the parties agreement, however, ended. In the Petition, Petitioner argued that certain functional elements of the design should not be considered part of the design patent claim. Patent Owner disagreed, arguing that, whether or not the elements are functional, they must still be considered as part of the visual impression created by the design as a whole. Id. 

In explaining its rational, the Board stated an ornamental design for an article of manufacture may not be patented if the design is “primarily functional” rather than “primarily ornamental.”  Order at 4. Further, of course, a design patent must not be obvious, pursuant to §103. Id. The inquiry into functionality, however, is separate and distinct from the obviousness analysis. Id. at 5. As such, the allegedly functional elements of a design patent must be considered in an obviousness analysis of the visual impression created by the patented design as a whole. Id.

After deciding that the “functional” characteristics issue, the Board turned to the obviousness analysis, citing Apple, Inc. v. Samsung Elecs. Co., 678 F.3d 1314, 1329 (Fed. Cir. 2012), for the proposition that, in an obviousness challenge to a design patent, the ultimate inquiry is “whether the claimed design would have been obvious to a designer of ordinary skill who designs articles of the type involved.” Order at 6.

Primarily because the functional characteristics of the design claim were considered in the obviousness analysis, the Board concluded that Petitioner failed to demonstrate a reasonable likelihood that a designer of ordinary skill would have viewed the primary prior art reference to give the same visual impression as the challenged design patent. Id. at 21. As such, the Petition was denied.

43 for 48: First Design Patent Placed Into Inter Partes Review Trial

iStock_000011216568XSmallMunchkin, Inc. and Toys “R” Us were successful in challenging a Luv N’ Care, Ltd. design patent in a case styled as Munchkin, Inc. and Toys “R” Us, Inc. v. Luv N’ Care, Ltd. (IPR2013-00072), involving U.S. Pat. No. D617,465. The ‘465 patent, entitled “Drinking Cup,” described an ornamental design for a drinking cup having a vessel, collar, and spout.

The Board began by evaluating the prior art relied upon by Patent Challengers in their challenge of the claim in the ‘465 patent. Two grounds for challenge were based on obviousness in light of a single reference.  From there, however, Patent Challengers raised numerous additional multi-reference grounds classified into seven categories, with each category proposing a principal reference in view of several additional references. Since this resulted in the proposed grounds numbering in the hundreds or thousands, the Board noted that Patent Challenger was not entitled to have all such grounds considered, but the Board did address the grounds in a general manner.

The first issue the Board had to face was the proper priority date for the ‘465 patent.  Because a continuation application must comply with the written description requirement to be entitled to a parent’s effective filing date, the Board pointed out that, when an issue of priority arises “in the context of design patent prosecution, one looks to the drawings of the earlier application for disclosure of the subject matter claimed in the later application.”  Order at 6-7.  To this end, the Board agreed with Patent Challenger that the parent disclosure did not provide written description support for the claim of the ‘465 patent.

After establishing priority dates relevant to the ‘465 design, the Board began a claim construction analysis. The Board construed the claim to be for the ornamental design of the drinking cup and proceeded to give verbal descriptions of the features of the design seen in the drawings; specifically, a vessel, collar, and spout. Further, the Board rejected the Patent Challengers’ argument that the vessel and collar do not form part of the claim because they are functional. The Board based this decision on the fact that Patent Challengers did not persuade them that the vessel and collar were purely functional and not also ornamental. Order at 12-13.

Next, the Board began its analysis of Patent Challengers’ asserted grounds of unpatentability. The design of the drinking cup of the ‘465 patent was shown to be similar enough to the design of a drinking cup described by two separate single references that “in the eye of an ordinary observer, the designs are substantially the same, such that they would deceive the observer.”  Order at 14.  Accordingly, the Board held that the there was a reasonable likelihood that the ‘465 patent claim was obvious over the two cited references and granted the Petition. To complete the record, the Board then generally considered the hundreds of additional obviousness grounds, finding that the designs in those references were substantially different from those of the ’465 patent and, denying the additional grounds.

In the end, design patents are not immune from the pro-Patent Challenger wave that has characterized the first months of IPR practice.

First Inter Partes Review of a Design Patent

On December 5, 2012, Munchkin, Inc. and Toys “R” Us, Inc. filed the first Inter Partes Review petition directed to a design patent, targeting US Patent No. D617,465, entitled DRINKING CUP.  Not surprisingly, the patent is the subject of a lawsuit brought by Luv N’ Care, Ltd. against Toys “R” Us in the Southern District of New York.

The inclusion of claim construction issues in Inter Partes Review proceedings is one of the most interesting aspects of these proceedings and the strategies relating to this issue bear watching. In this design patent case, and despite the guidance in Egyptian Goddess, Inc. v. Swisa, Inc., 543 F.3d 665, 679 (Fed. Cir. 2008) (“the preferable course ordinarily will be [to not] attempt to ‘construe’ a design patent…”), the petitioner in this IPR attempts to set forth a form of verbal description of the claimed design.

Otherwise, the petition does not differ remarkably from the pattern used/required in utility patent cases – there is a priority date issue; there are multiple combinations of prior art used to attempt to demonstrate the unpatentability of the claims; etc.

Next up, I am sure, a motion to stay….