ITC: A Pair of Section 337 Investigations Involving Automotive Lamps Illuminated the Potential of Design Patents

Design Patent Trends at the ITC

The trend of the US International Trade Commission issuing remedial orders for design patents at higher percentages than for utility patents continued in 2023.¹ From 2015-2023, 356 such investigations were concluded. And of those 356 investigations, 187 cases proceeded to Final Determination. The Commission found a violation and issued Remedial orders in 112 of the 187 cases. From 2015 through 2023, the Commission issued General Exclusion Orders (GEO) in 65% of the design patent cases that went to Final Determination, compared to 13% for Section 337 investigations asserting utility patents. Additionally, the Commission issued Limited Exclusion Orders (LEO) in 40% of the Final Determinations involving design patents, compared to 44% for Section 337 investigations asserting just utility patents or other unfair acts. Finally, the Commission issued Cease-and-Desist Orders (CDO) in 65% of Section 337 investigations involving design patents, compared to 41% for Section 337 investigations asserting just utility patents or other unfair acts.

Certain Replacement Automotive Lamps I and II

The Commission issued one GEO in a design patent case in 2023. The low number was likely due to the fact that Complainants did not seek a GEO in two major 337 investigations involving design patents that were initially expected to terminate this year: Certain Replacement Auto-motive Lamps (Inv. No. 337-TA-1291) and Certain Replacement Automotive Lamps II (Inv. No. 337-TA-1292).² In those investigations, Complainants Kia and Hyundai each sought only a LEO and CDO against the named respondents, TYC Brother Industrial Co., Genera Corporation, LKQ Corporation of Chicago, and Keystone Automotive Industries (collectively, “Respondents”). Though Inv. Nos. 337-TA-1291 and 337-TA-1292 have not yet concluded, the Initial Determination (“ID”) issued in those investigations found none of the asserted patents to be invalid as anticipated or obvious, and found a violation of section 337 by Respondents with respect to 17 of Kia’s 20 asserted design patents for various automobile lamps and with respect to all 21 of Hyundai’s patents for various automobile lamps. both IDs recommended issuing a LEO should the ITC find a violation, but not a CDO because the evidentiary record did not demonstrate that Respondents maintain a commercially significant inventory of infringing products in the United States.

Respondents challenged Complainants Hyundai’s and Kia’s contentions that they satisfy the technical prong of the domestic industry requirement. The technical prong requires that the complainant “show that there is a domestic industry product that actually practices at least one claim of the asserted patent.” Broadcom Corp. v. ITC, 28 F.4th 240, 250 (Fed. Cir. 2022). Respondents argued that the asserted patents at issue depict—and therefore claim—either a passenger- or a driver-side lamp, and thus, Complainants’ purported representative domestic industry products depicting the mirror image of the patented designs do not practice the designs claimed in the asserted patents.

The administrative law judge (ALJ) presiding over Inv. No. 337-TA-1292 determined that under the proper inquiry—whether an ordinary observer would find the overall visual impression of the patented design and the mirror image domestic industry product design to be substantially similar—the overall visual impressions of the claimed designs of the asserted patents and the corresponding mirror image domestic industry products at issue are substantially the same, and therefore, Hyundai satisfies the technical prong of the domestic industry requirement. Compare representative images of some of Hyundai’s patented designs and their purported domestic industry products, below.

The ALJ presiding over Inv. No. 337-TA-1291 reached the same conclusion. Declining to limit scope of the Asserted Kia patents to the specific passenger-/driver-side of the lamp shown and relying on expert testimony that an ordinary observer would find the overall visual impression of patented design and the corresponding mirror image domestic industry product design to be substantially similar, the ALJ found that Kia satisfied the technical prong of the domestic industry requirement. Compare representative images of some of Kia’s patented designs and their purported domestic industry products, below.

However, the ALJ found that Kia failed to satisfy the technical prong of the domestic industry requirement for three of its asserted patents: D781,471; D749,757; and D705,963. According to the ALJ, D’471 and D’757 include a prominent flange that is not practiced by their corresponding purported domestic industry products, and D’963 lacks surface patterns that are present in the purported domestic industry product. Compare representative images of the D’471, D’757, and D’963 Patents and their purported domestic industry products, below. The images of the D’471, D’757, and D’963 Patents are marked up to indicate their substantial visual differences with their purported domestic industry products.

Kia might have improved its ability to satisfy the technological prong for these three patents had the prominent flange (in the D’757 and D’963 Patents) and the lower area (in the D’963 Patent) been drawn in broken lines to indicate that they are disclaimed subject matter. Armed with the knowledge that succeeding in a Section 337 investigation requires satisfying the technical prong of the domestic industry, a design patent applicant should consider prospectively drafting its design patent applications to satisfy the technical prong. This includes ensuring that the design application drawings depict the to-be commercialized embodiment before filing, or using broken lines (or other drawing conventions) in the design patent application drawings to disclaim elements that might not yet be finalized in the to-be commercialized design when filing the design application drawings.

Applicability of ITC Severance Rules

The significant number of design patents at issue in each Inv. Nos. 337-TA-1291 and 337-TA-1292 (at least 20 in each investigation) is remarkable in that it did not trigger subjecting either investigation to the ITC’s severance rules. Those severance rules permit the Commission or an ALJ to sever an investigation into multiple investigations voluntarily, or upon a motion from any party in the investigation, when a “complaint alleges a significant number of unrelated technologies, diverse products, unrelated patents, and/or unfair methods of competition or unfair acts such that the resulting investigation, if implemented as one case, may be unduly unwieldy or lengthy.” Rules of General Application, Adjudication and Enforcement (issued April 26, 2018) at 11. See also 9 C.F.R. §210.10(a)(6), §210.14(h). Although there are no pre-set cut-offs to sever an investigation, for Complainants considering filing an investigation, asserting no more than five patents per investigation serves as a useful rule-of-thumb.

Since being adopted in 2018, the rules of severance have been raised in three investigations³, though only one investigation appears to have been severed. Light-Emit-ting Diode Products, Systems, and Components Thereof (I), Inv. No. 337-TA-1163, which involved seven patents and one false advertising claim, was severed into three co-pending ITC investigations. Though the ITC’s severance rules did not come into play in Kia’s and Hyundai’s Inv. Nos. 337-TA-1291 and 337-TA-1292, a design patent holder should be mindful that investigations involving solely design patents are not exempt from the severance rules and weigh the risks of severance before asserting a significant number of design patents directed to diverse products in a single ITC complaint.

³ Severance rules were raised but ultimately not applied in Certain Earpiece Devices & Components Thereof, Inv. No. 337-TA-1121 (which involved six patents and 32 claims across them) and in Certain Data Transmission Devices, Components Thereof, Associated Software, & Prods. Containing the Same, Inv. No. 337-TA-1150 (which involved three patents and 90 claims across them). In each investigation, the complainant and respondent opposed severance. The Commission Investigative Staff’s reasons for recommending against severing Inv. No. 337-TA1121 were two-fold: (1) there were only 12 independent claims asserted, and (2) five of the six asserted patents were in the same family and highly similar to one another. Rather than severing Inv. No. 337-TA-1150, the Commission reduced the asserted claims from 90 to 20 (total for all three asserted patents) and imposed other limitations to ensure that the investigation would progress efficiently.

This article appeared in the 2023 Design Patents Year in Review: Analysis and Trends report.