It is an all too common refrain amongst American furniture designers: How can we stop infringers when U.S. courts view slight, insubstantial tweaks to patented furniture design as enough to avoid infringement by a similarly designed product?  In view of a recent appeals court decision, furniture designers may be changing their tune – at least those who are aware of this important decision. The recent decision, which  regards the ubiquitous Crocs and “Crocs-style” foam water-clog footwear, delivered a major warning shot to knock-off artists in all industries, making it known that minor differences in designs will not be enough to avoid infringement where the “overall effect” of the patented and accused designs remain substantially the same.    This case will have significant ramifications with respect to not only the water-clog footwear industry, but U.S. design patents in general, including the furniture industry.

On Feb. 24, 2010, in Crocs, Inc. v. ITC, the U.S. Court of Appeals for the Federal Circuit reversed the International Trade Commission's (ITC) finding that shoes sold by Respondents Double Diamond Distribution, Effervescent Inc. and Holey Soles Holdings did not infringe Crocs’ U.S. design patent.  Instead, the Court affirmatively held that the “knock-off” shoe designs did infringe Croc’s design patent.  Despite noticeable differences between the patented and accused designs, the Court overturned the ITC’s decision, noting that the differences would not be enough to convince an ordinary observer that the “overall effect” of the accused design was not the same as the patented design.

Brief History of ITC Proceedings
The origins of Crocs, Inc. v. ITC dates back to March 31, 2006, when Crocs filed a complaint with the ITC against 11 companies alleging infringement, including infringement of one of its design patents.   The complaint sought an exclusion order banning the importation of certain water-clog shoes.  The asserted Croc’s design patent was U.S. Patent No. D517,789 (‘789 patent).  Representative images of the ‘789 patent are shown below on the left, while representative images of one of the accused water clogs, Double Diamond, are shown below on the right.

In its Initial Determination, dated April 2008, the ITC set forth a 150-word detailed verbal description of the ‘789 patent, rather than simply relying on the patent drawings themselves.  Using this verbalized claim construction, the ITC concluded that the two shoes were too different from one another in appearance and thus concluded that there was no infringement.  Specifically, the ITC noted differences between the accused design and the patented design, including, the specific width of the back holding strap, and the specific shape and spacing of the openings on the top and side of the shoes.  Crocs appealed the decision to the Federal Circuit.

Federal Circuit’s Holding
The Federal Circuit began its opinion by sharply criticizing the ITC for its overly detailed description of the claimed design: “[t]his court has cautioned, and continues to caution, trial courts about excessive reliance on a detailed verbal description in a design infringement case… This case shows the dangers of reliance on a detailed verbal claim construction.”  In contrast to the ITC’s hyper-technical analysis, the Federal Circuit reiterated its general rule that the design patent’s drawings speak for themselves and that courts should not endeavor to convert the drawings into words.

With claim construction issues addressed, the Federal Circuit moved to the infringement analysis.  The Federal Circuit concluded that the ITC’s finding of non-infringement was erroneous; specifically it commented that the ITC’s analysis focused too much on the granular details of the patented and accused designs and not on the “overall effect” of the two designs.  The Federal Circuit identified the ITC’s detailed claim construction as the culprit to the flawed analysis, noting that it “became a mistaken checklist for infringement.”  In finding infringement, the Federal Circuit included a clear reminder that: “Minor differences between a patented design and an accused article’s design cannot, and shall not prevent a finding of infringement.”

Impacts of Decision
The design patent-friendly Crocs decision likely will be well received by the furniture design community.  First, the decision provides affirmation for the general rule that detailed claim constructions should not be attempted.  This is important because “checklist” verbalizations like the one employed by the ITC are prone to yielding a finding of non-infringement.  As the Court mentioned, verbalized claim constructions “can easily detract from the proper infringement analysis of the ornamental patterns and drawings.”  Simply put, drawings, rather than words, are the best means to communicate furniture design.

Second, the opinion provides insight into the Federal Circuit’s psyche on the difficult question in design patent cases of “how close is too close?”  In other words, how broad is the scope of a design patent?

In Crocs, we are afforded this window of insight because the Federal Circuit took the somewhat extraordinary step of engaging in fact-finding on the issue of infringement.  (The Court could have simply vacated the ITC’s claim construction and finding of non-infringement, and then remanded for fact-finding at the ITC.)  By affirmatively finding infringement on a shoe that had several noticeable differences, the Federal Circuit appears to have afforded the ‘789 patent significant scope.  Swapping out circles for squares and slightly shuffling the features around was not enough to change the overall effect of the accused designs.  Applying the lessons of this case to the furniture world, its seems as if the courts will be less inclined to assign importance to minor differences in detail, and will now focus more on the “overall effect” of the design.  Most often, “knock-offs” aim to mimic the overall effect, while make some minute changes here and there to hide behind.

As a result of this design patent-friendly decision,  an uptick in the procurement and enforcement of design patents is anticipated.  Design patents are poised to gain pace with the traditionally high-profile world of furniture design.  Over the last decade, furniture designs have taken a prominent position on the global stage for a variety of reasons, the most unmistakable of which is the fact that they transcend language and cultural barriers.  After all, a product’s outward appearance is the first thing consumers see.  Consumers judge a product based on its appearance. A product’s design can be the simplest, most direct manner in which to reach consumers. Indeed, sometimes appearance is the only way to differentiate a product from its competitors.

The need for design patents is also fueled by a more pragmatic reason, namely, the deluge of knock-offs coming into the United States at record rates, forcing companies to actively seek protection.  (Crocs had been trying for years to curb the rampant proliferation of Crocs-style footwear.  Indeed, a word search on Alibaba.com, a Chinese Website for product manufacturers, yields 27,915 hits for the search term “water clog shoes.”)  Companies, both large and small, are already investing significant resources to create new, appealing designs, and the Crocs v. ITC opinion will provide re-assurance that minor changes will not be sufficient to avoid infringement if the overall effect of the design remains the same.   The central message from the Crocs is clear: Despite noticeable differences, there will be infringement when the “overall effect” of the patented and accused designs is substantially the same.  Knock-off artists proceed at your own peril.

2010 NeoCon Session: Protect Your Design…
Mr. Carani will be presented at NeoCon 2010 on Wednesday, June 16 from 2:30-3:30 in Room 7-C.  His presentation entitled “Looks Matter: Protect your Design While Creating Valuable Intellectual Property Assets” will center on the protection and enforcement of product designs through the use of intellectual property (IP) laws, including design patents, trade dress, and copyright. Attendees will learn about: (1) what products can be protected by designs patents, trademarks or copyrights, (2) what one can do to avoid infringing other's intellectual property rights, and (3) how to enforce/license design IP rights.

Christopher Carani, Esq. is a shareholder at the intellectual property law firm of McAndrews, Held & Malloy, Ltd. in Chicago. He is a nationally recognized expert in the field of design law, which regards the protection and enforcement of the design of products using design patents, trade dress and 3D copyrights. He has litigated numerous design law disputes on a wide range of strategic design protection and enforcement issues & currently chairs the Industrial Designs Committee for the American Intellectual Property Law Association (AIPLA). At ccarani@mcandrews-ip.com & www.designpatentattorney.com. A version of this article appeared in the 5/17/10 issue of National Law Journal.