Alert September 26, 2008

Federal Circuit Rejects “Point of Novelty” Test for Design Patent Infringement

On September 22, 2008, in Egyptian Goddess, Inc. v. Swisa, No. 2006-1563, the U.S. Court of Appeals for the Federal Circuit, in a unanimous en banc opinion, rejected the long-standing “point of novelty” test as a “second and free standing requirement for proof of design patent infringement,” holding that the “ordinary observer” test, albeit one in which the ordinary observer takes into account prior art, is the proper test for infringement in design patent cases.

The court also held that, in a design patent infringement case, a district court need not “construe” a design patent claim “by providing a detailed verbal description of the claimed design.”

Procedural History

The case concerns a design patent infringement claim brought by Egyptian Goddess, Inc. (“EGI”) against Swisa, Inc. (“Swisa”) for a competing line of fingernail buffers.

The district court construed the claimed patent by giving a detailed verbal description of the product. It then applied both the “ordinary observer” and “point of novelty” tests that have long been the standard for assessing design patent infringement. The district court concluded that there was no infringement because the Swisa buffer failed to incorporate a novel feature that was present in the EGI design.

A three-judge panel of the Federal Circuit affirmed the district court’s ruling, applying the “point of novelty” test, and affirmed the grant of summary judgment. In so doing, it defined a “point of novelty” as “either a single novel design element or a combination of elements that are individually known in the prior art.”

The court granted en banc re-hearing, asking the parties to address (i) whether the “point of novelty” test should continue to be used as a test for design patent infringement, and if so how the test should be applied, and (ii) whether district courts should perform claim construction in design patent cases.

A Look Back: Gorham Co. v. White and Litton Systems, Inc. v. Whirlpool Corp

The starting point for the court’s analysis was Gorham Co. v. White, 81 U.S. 511 (1871), in which the Supreme Court articulated the test that has become known as the “ordinary observer” test. In that case, the Supreme Court held:

[I]f, 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.

Id. at 528.

The court then revisited its opinion in Litton Systems, Inc. v. Whirlpool Corp., 728 F.2d 1423 (Fed. Cir. 1984), which was the genesis of the “point of novelty” test as a second, necessary analysis for determining infringement in design patent cases. In that case, the Federal Circuit held:

For a design patent to be infringed . . . no matter how similar two items look, “the accused device must appropriate the novelty in the patented device which distinguishes it from the prior art.”  That is, even though the court compares two items through the eyes of the ordinary observer, it must nevertheless, to find infringement, attribute their similarity to the novelty which distinguishes the patented device from the prior art.

Litton Systems, 728 F.2d at 1444 (citations omitted).

The court acknowledged that Litton had widely been interpreted as creating a second test for design patent infringement, but noted that “[i]t had not been until much more recently” that courts found that failure to apply the test as a second, independent criterion was legal error.

The court went on to note that while the “point of novelty” is easily applied in cases where a single novel feature exists in a claimed design, it is more difficult to apply when there are multiple claimed points of novelty or multiple prior art references. Specifically “applying the point of novelty test where multiple features and multiple prior art references are in play has led to disagreement over whether combinations of features, or the overall appearance of a design, can constitute the point of novelty of the claimed design.”

The “Ordinary Observer” Test: Observing Design Differences in the Context of Prior Art

In a dramatic break from its prior opinions, the court found that Litton does not impose a second “point of novelty” test, but rather, is “more properly read as applying a version of the ordinary observer test in which the ordinary observer is deemed to view the differences between the patented design and the accused product in the context of the prior art.” 

As explained by the court, “when the claimed design is close to the prior art designs, small differences between the accused design and the claimed design are likely to be important to the eye of the hypothetical ordinary observer.”  Thus, using the prior art as a frame of reference is particularly important in close cases where the prior art designs “can highlight the distinctions between the claimed design and the accused design as viewed by the ordinary observer.”

The court went to identify several advantages of the new “ordinary observer” test over the prior two-part test in which the “point of novelty” test was an independent test. Specifically,

  • Under the “point of novelty” test, where a design has multiple “points of novelty” “the attention of the court may therefore be focused on whether the accused design has appropriated a single specified feature of the claimed design, rather than . . . whether the accused design has appropriated the claimed design as a whole.” The “ordinary observer” approach adopted by the court, avoids the problem that, under the “points of novelty” test, “the outcome of the case can turn on which of the several candidate points of novelty the court or fact finder focuses on.” 
  • Designs with multiple points of novelty were disadvantaged under the “point of novelty” test in that defendants could argue their designs do not contain all of the novel features.
  • Unique design elements that “depart conspicuously from the prior art” will be more easily identified as infringing under the new “ordinary observer” test.
  • Under the new “ordinary observer” test, small differences will be less susceptible to exaggerated importance simply by virtue of having been designated a “point of novelty.”

The Federal Circuit did not entirely dismiss the importance of novelty in determining design patent infringement. It held that “examining the novel features of the claimed design can be an important component of the comparison of the claimed design with the accused design and the prior art.”

Applying its new “ordinary observer” standard, the court found that “no reasonable fact-finder could find that EGI met its burden of showing that an ordinary observer, taking into account the prior art, would believe the accused design to be the same as the patented design.”

Burden of Production of Prior Art Borne by Defendant

The new “ordinary observer” test imposes a slight change to the parties’ respective burdens of production. A patentee bears the burden of proof in an infringement action. Under the old, two-part rule, the patentee bore the burden of production with respect to prior art. By contrast, under the new “ordinary observer” test, the accused infringer bears the burden of production of prior art, but only if comparison to prior art is raised as part of its defense.

No Claim Construction Necessary

The court also addressed the issue of whether district courts must “construe” claims in design patent cases, by providing a “detailed verbal description of the claimed design.”  It concluded that, unlike utility patent cases, there was no such requirement in design patent cases.

The court noted that for design patents, an illustration is often more effective than a detailed verbal description, but indicated that it might nevertheless be helpful for a court to “point out . . . various features of the claimed design as they relate to the accused design and the prior art.”  The court also identified the risks inherent in a verbal description “such as the risk of placing undue emphasis on particular features of the design and the risk that a finder of fact will focus on each individual described feature in the verbal description rather than on the design as a whole.”

Ultimately, the court found that the trial court has broad discretion in determining what level of detail should be used in describing the design.

Conclusion

The Federal Circuit has dramatically changed the landscape underlying the analysis of design patent infringement claims. The court’s elimination of an express point of novelty analysis, and its modification of the “ordinary observer” test to take into account a knowledge of the prior art, may make it easier to prove design patent infringement. On the other hand, the court’s elimination of the need for a textual claim construction, and its implicit recognition that a picture is worth a thousand words when considering design patents, may serve to limit the scope of such patents to what is actually shown, rather than an expansive textual description of what the patentee says they show.