Clogging up the Federal CircuitFebruary 19, 2010

On December 17, 2009, the Court of Appeals for the Federal Circuit addressed in International Seaway Trading Corp. v. Walgreens Corp. whether the "ordinary observer" test from Egyptian Goddess likewise applies to anticipation of design patents.

In Egyptian Goddess, the CAFC dropped the "point of novelty" test for design patent infringement and adopted the "ordinary observer" test from Goram Mfg. Co. v. White, where the Supreme Court held:

that if, 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 patent is infringed by the other.

81 U.S. 511, 528 (1871).

More on International Seaway Trading Corp. v. Walgreens Corp. after the jump.

International Seaway Trading ("Seaway") is a buyer's agent and importer of footware to mass merchandise retailers. They sued Walgreens and Touchsport Footwear for infringing its U.S. design patents relating to "clogs," of which Design Patent number D529,263 is representative. The defendants asserted that the patents were invalid under 35 U.S.C. § 102 based on U.S. Design Patent number D517,789 , assigned to Crocs, Inc. ("Crocs"), and were granted summary judgment for anticipation.

Seaway appealed, asserting several grounds for error. First, Seaway asserted that the District Court for the Southern District of Florida erred by only considering the ordinary observer test and not the point of novelty test. Second, Seaway contends that even if the District Court applied the right test, it failed to compare the entirity of the patent designs, particularly the insoles of the clogs.

Regarding Seaway's first point, the court discussed the "well established" rule that "the same test must be used for both infringement and anticipation." Slip Op. at 8. Because Egyptian Goddess changed the rule for infringement, the court "concluded that the ordinary observer test must logically be the sole test for anticipation as well." Slip Op. at 10. Therefore, the test for invalidity for design patent anticipation (or obviousness) is now the ordinary observer test. The court also noted that the decision of combining prior art for purposes of obviousness still remains in the hands of the person having skill in the art. However, once that art has been constructed, it remains a question as to whether an ordinary observer would consider the art to be substantially the same as the applied for design.

Seaway also asserted that the District Court misapplied the ordinary observer test by failing to consider the art as a whole. Specifically, the District Court held "that the law requires a court to consider only those portions of the product that are visible during normal use, regardless of whether those portions are visible during the point of sale." Slip Op. at 12 quoting Int'l Seaway Trading Corp. 599 F. Supp. 2d at 1315. The Court of Appeals agreed that the District Court was in error to refuse to consider the insoles of the shoes because they are hidden during the user's foot during normal use. Instead, the court reasserted its holding in Contessa that "all of the ornamental features illustrated in the figures must be considered in evaluating design patent infringement." Contessa Food Products, Inc. v. Conagra, Inc., 282 F.3d 1370, 1377. The district court mistakenly read Contessa to exclude the point of sale from "normal use," but the Court of Appeals points out that Contessa "emphasized that normal use should not be limited to only one phase or portion of the normal use lifetime of an accused product." Slip Op. at 13. The court indicated that "normal use" is the entire lifespan of a product, from manufacture to ultimate destruction. Because the District Court failed to consider the patented and infringing products as a whole, the Court of Appeals remanded the decision to the District Court to further consider the insoles of the two products.

Judge Clevenger dissented in only one part from the decision: the scope of the district court's further action on remand. Judge Clevenger argued that the majority had dissected the various parts of the product, identifying some elements as trivial and others as requiring further consideration by the court. Judge Clevenger points out that this dissection of the product into individual elements is reminiscent of the "point of novelty" test, and not the "ordinary observer" test, which requires courts to consider the product as a whole. Judge Clevenger would remand the case to the District Court to consider the differences in the designs as a whole, while otherwise agreeing with the majority.

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