Hartco Engineering, Inc. v. Wang’s International, Inc.
142 Fed.Appx. 455; 2005 WL 1724688 (C.A.Fed.)
United States Court of Appeals, Federal Circuit
July 25, 2005
Facts:
Defendants are Wang’s International, Pilot Automotive, Pep Boys-Manny, Moe & Jack, Inc. and Overton’s, Inc. Hartco Engineering was plaintiff. The patent at issue is directed to a design for a decorative marine-propeller device that attaches to the trailer hitch of a vehicle and spins from the force of moving air. The trade dress relates to the design of the product, the decorative hitchcover, and the packaging of the product. Hartco owns the ‘194 patent issued on November 17, 1998 which claims a design for a novelty trailer hitchcover featuring a three-blade marine propeller. In 1998, Wang’s agreed to purchase and distribute the hitchcovers from Hartco for two years under Wang’s “BULLY†trademark. In 2000 when the agreement was due to expire, Hartco raised its price. Wang’s opted to design its own four-blade hitchcover alleging there were defects in Hartco’s product. Wang’s was issued a patent on July 11, 2000.
While the agreement was still in effect, Wang’s marked the Hartco product with a blue insert showing a picture of the product on the upper right corner and clear plastic packaging to display the product. The insert also included the “BULLY†trademark and Hartco’s “PROP’R-HITCHCOVER†trademark on the upper left corner, a green curved stripe under the lettering for Hartco’s trademark, and a yellow ten-pointed star below the green stripe with the slogan “rotates while you drive†written in the star. When Wang’s began marketing its own product, it did so without the Hartco trademark and the green curved stripe or yellow star. Wang’s added its patent number and added the slogan “rotates freely as you drive.†It continued to use the blue insert card with a picture of the product on the upper right corner, its “BULLY†trademark on the upper left corner, and the clear plastic packaging to display the product.
Procedure:
In May 2001, Hartco filed a complaint against Wang’s alleging patent and trade dress infringement. District court adopted Wang’s construction of the scope of the ‘194 patent. After a jury trial, the jury found willful patent and trade dress infringement and awarded $1,799,845 in damages to Hartco. The jury erroneously awarded damages based on Hartco’s lost sales and Wang’s profits, so the court adjusted to account for lost sales alone. District court then denied defendant’s motion for judgment as a matter of law after jury verdict of willful patent and trade dress infringement.
Issue:
Holding:
Reverse district court’s denial of appellants’ motion for judgment as a matter of law regarding findings on design patent and product design trade dress. Affirm denial of appellants’ motion for judgment as matter of law on trade dress infringement.
Standard of Review:
The court reviews a jury finding of infringement under a substantial evidence test. The court will reverse if there is no legally sufficient evidentiary basis for a reasonable jury to find for that party on that issue.
Court Analysis:
Design Patent
Wang’s pointed out the differences between the products including its extra fourth blade and the lack of the four circular features. It also said the court failed in instructing the jury to apply the claim construction and by directing the jury to compare the accused device to the commercial product instead of the claimed product. Hartco said the differences were irrelevant because the two different designs are impossible for customers to distinguish. It said the addition of the fourth blade and lack of four circular features are not substantial changes.
A design patent only covers what is shown in the drawings in the patent. It is limited to the novel ornamental features. Thus, if the design has functional and ornamental features, the patentee must show the infringement based on the ornamental features only. The Court agreed with the court’s description of the ‘194 patent showing a hitchcover with three blades attached to a tongue having four circular features that are visible. Only these ornamental features are protected. Thus, Hartco’s design patent does not cover any hitchcover shaped as a propeller with any number of blades, regardless of its ornamental features. The blades, nose, and tongue are not protected ornamental aspects. Only the number and shape of blades are.
Following claim construction, the court had to compare the patented and accused designs overall. The ordinary observer test compares the ornamental features of the patented design, as shown in all of the drawings to the features of the alleged infringing product visible at anytime during normal use of the product. The point of novelty test requires proof that the accused device infringes the novel aspects of patented design as distinct from the prior art. The court disagreed with the lower court, concluding the designs do not have to be identical to an accused device to be protected. Wang’s product had a substantially different overall ornamental appearance from the claimed three-blade product. No reasonable jury could have concluded that the overall visual appearance of the claimed design is substantially similar to the accused design, the court did not need to employ the point of novelty test.
Trade Dress Infringement
Jury found that Wang’s infringed Hartco’s trade dress of the hitchcover design and packaging. Wang’s claimed the jury instructions did not discuss the elements to prove secondary meaning for product configuration and inherent distinctiveness for packaging. Hartco said trade dress can be protected absent secondary meaning. It also claimed that even if secondary meaning is necessary to prove trade dress infringement on the product and package, that it proved secondary meaning.
Protection for trade dress comes from §43(a) of the Lanham Act. Trade dress refers to product packaging and the design of the product itself. The total image includes size, shape, color, and texture. Trade dress is protectable if it is distinctive, either inherently or as acquired through secondary meaning and nonfunctional. Liability under §43 requires proof of likelihood of confusion. The court applied Fifth Circuit law.
Product Design
Trade dress protects only the overall appearance of a product. Hartco would have to show the trade dress was nonfunctional, distinctive, and acquired secondary meaning. It also had to show a likelihood of confusion. The court disagreed that the hitchcover was inherently distinctive. A product design cannot be inherently distinctive. To determine if a product has secondary meaning, the court looked at length and nature of use, sales volume and advertising, consumer surveys and testimony, and Wang’s intent. Though Hartco sold its hitchcover for four years, there was no evidence that its sales volume, advertising, nature of use, or Wang’s intent proved that Hartco acquired secondary meaning. Hartco offered no survey evidence. Thus, Hartco did not establish secondary meaning and the trade dress was not protectable for the product.
Packaging
Product packaging is capable of being inherently distinctive and a showing of secondary meaning may be unnecessary to prevail on a trade dress claim. Packaging trade dress is inherently distinctive if its intrinsic nature identifies the source of the product. Hartco’s packaging trade dress included the clear plastic package, the blue cardboard background, and Hartco’s trademark. Separately, these elements are descriptive and not subject to trade dress protection. But, taken together, the trade dress is inherently distinctive and subject to protection.
The court then looked to see if there was a likelihood of confusion. The elements the court looked at were (1) type of mark (2) similarity between the marks (3) similarity of products or services (4) identity of the retail outlets and purchasers (5) identity of the advertising media used (6) Wang’s intent (7) evidence of actual confusion. Here, the trade dress was similar, the products are interchangeable, the purchasers and advertisers are the same, and there was actual confusion. Wang’s intent was to copy Hartco’s packaging. Thus, there was evidence to show trade dress infringement on packaging.
142 Fed.Appx. 455; 2005 WL 1724688 (C.A.Fed.)
United States Court of Appeals, Federal Circuit
July 25, 2005
Facts:
Defendants are Wang’s International, Pilot Automotive, Pep Boys-Manny, Moe & Jack, Inc. and Overton’s, Inc. Hartco Engineering was plaintiff. The patent at issue is directed to a design for a decorative marine-propeller device that attaches to the trailer hitch of a vehicle and spins from the force of moving air. The trade dress relates to the design of the product, the decorative hitchcover, and the packaging of the product. Hartco owns the ‘194 patent issued on November 17, 1998 which claims a design for a novelty trailer hitchcover featuring a three-blade marine propeller. In 1998, Wang’s agreed to purchase and distribute the hitchcovers from Hartco for two years under Wang’s “BULLY†trademark. In 2000 when the agreement was due to expire, Hartco raised its price. Wang’s opted to design its own four-blade hitchcover alleging there were defects in Hartco’s product. Wang’s was issued a patent on July 11, 2000.
While the agreement was still in effect, Wang’s marked the Hartco product with a blue insert showing a picture of the product on the upper right corner and clear plastic packaging to display the product. The insert also included the “BULLY†trademark and Hartco’s “PROP’R-HITCHCOVER†trademark on the upper left corner, a green curved stripe under the lettering for Hartco’s trademark, and a yellow ten-pointed star below the green stripe with the slogan “rotates while you drive†written in the star. When Wang’s began marketing its own product, it did so without the Hartco trademark and the green curved stripe or yellow star. Wang’s added its patent number and added the slogan “rotates freely as you drive.†It continued to use the blue insert card with a picture of the product on the upper right corner, its “BULLY†trademark on the upper left corner, and the clear plastic packaging to display the product.
Procedure:
In May 2001, Hartco filed a complaint against Wang’s alleging patent and trade dress infringement. District court adopted Wang’s construction of the scope of the ‘194 patent. After a jury trial, the jury found willful patent and trade dress infringement and awarded $1,799,845 in damages to Hartco. The jury erroneously awarded damages based on Hartco’s lost sales and Wang’s profits, so the court adjusted to account for lost sales alone. District court then denied defendant’s motion for judgment as a matter of law after jury verdict of willful patent and trade dress infringement.
Issue:
Holding:
Reverse district court’s denial of appellants’ motion for judgment as a matter of law regarding findings on design patent and product design trade dress. Affirm denial of appellants’ motion for judgment as matter of law on trade dress infringement.
Standard of Review:
The court reviews a jury finding of infringement under a substantial evidence test. The court will reverse if there is no legally sufficient evidentiary basis for a reasonable jury to find for that party on that issue.
Court Analysis:
Design Patent
Wang’s pointed out the differences between the products including its extra fourth blade and the lack of the four circular features. It also said the court failed in instructing the jury to apply the claim construction and by directing the jury to compare the accused device to the commercial product instead of the claimed product. Hartco said the differences were irrelevant because the two different designs are impossible for customers to distinguish. It said the addition of the fourth blade and lack of four circular features are not substantial changes.
A design patent only covers what is shown in the drawings in the patent. It is limited to the novel ornamental features. Thus, if the design has functional and ornamental features, the patentee must show the infringement based on the ornamental features only. The Court agreed with the court’s description of the ‘194 patent showing a hitchcover with three blades attached to a tongue having four circular features that are visible. Only these ornamental features are protected. Thus, Hartco’s design patent does not cover any hitchcover shaped as a propeller with any number of blades, regardless of its ornamental features. The blades, nose, and tongue are not protected ornamental aspects. Only the number and shape of blades are.
Following claim construction, the court had to compare the patented and accused designs overall. The ordinary observer test compares the ornamental features of the patented design, as shown in all of the drawings to the features of the alleged infringing product visible at anytime during normal use of the product. The point of novelty test requires proof that the accused device infringes the novel aspects of patented design as distinct from the prior art. The court disagreed with the lower court, concluding the designs do not have to be identical to an accused device to be protected. Wang’s product had a substantially different overall ornamental appearance from the claimed three-blade product. No reasonable jury could have concluded that the overall visual appearance of the claimed design is substantially similar to the accused design, the court did not need to employ the point of novelty test.
Trade Dress Infringement
Jury found that Wang’s infringed Hartco’s trade dress of the hitchcover design and packaging. Wang’s claimed the jury instructions did not discuss the elements to prove secondary meaning for product configuration and inherent distinctiveness for packaging. Hartco said trade dress can be protected absent secondary meaning. It also claimed that even if secondary meaning is necessary to prove trade dress infringement on the product and package, that it proved secondary meaning.
Protection for trade dress comes from §43(a) of the Lanham Act. Trade dress refers to product packaging and the design of the product itself. The total image includes size, shape, color, and texture. Trade dress is protectable if it is distinctive, either inherently or as acquired through secondary meaning and nonfunctional. Liability under §43 requires proof of likelihood of confusion. The court applied Fifth Circuit law.
Product Design
Trade dress protects only the overall appearance of a product. Hartco would have to show the trade dress was nonfunctional, distinctive, and acquired secondary meaning. It also had to show a likelihood of confusion. The court disagreed that the hitchcover was inherently distinctive. A product design cannot be inherently distinctive. To determine if a product has secondary meaning, the court looked at length and nature of use, sales volume and advertising, consumer surveys and testimony, and Wang’s intent. Though Hartco sold its hitchcover for four years, there was no evidence that its sales volume, advertising, nature of use, or Wang’s intent proved that Hartco acquired secondary meaning. Hartco offered no survey evidence. Thus, Hartco did not establish secondary meaning and the trade dress was not protectable for the product.
Packaging
Product packaging is capable of being inherently distinctive and a showing of secondary meaning may be unnecessary to prevail on a trade dress claim. Packaging trade dress is inherently distinctive if its intrinsic nature identifies the source of the product. Hartco’s packaging trade dress included the clear plastic package, the blue cardboard background, and Hartco’s trademark. Separately, these elements are descriptive and not subject to trade dress protection. But, taken together, the trade dress is inherently distinctive and subject to protection.
The court then looked to see if there was a likelihood of confusion. The elements the court looked at were (1) type of mark (2) similarity between the marks (3) similarity of products or services (4) identity of the retail outlets and purchasers (5) identity of the advertising media used (6) Wang’s intent (7) evidence of actual confusion. Here, the trade dress was similar, the products are interchangeable, the purchasers and advertisers are the same, and there was actual confusion. Wang’s intent was to copy Hartco’s packaging. Thus, there was evidence to show trade dress infringement on packaging.