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18-1613

_______________________________________________________________

United States Court of Appeals


for the Federal Circuit
__________________________

AUTOMOTIVE BODY PARTS ASSOCIATION,

Plaintiff-Appellant,
v.

FORD GLOBAL TECHNOLOGIES, LLC.,

Defendant-Appellee,

APPEAL FROM THE UNITED STATES DISTRICT COURT FOR THE


EASTERN DISTRICT OF MICHIGAN IN CASE NO. 2:15-CV-10137
JUDGE LAURIE J. MICHELSON

_____________________________

CORRECTED BRIEF FOR THE APPELLANT


_____________________________

Robert G. Oake, Jr. Paul M. Kittinger (P72754)


Texas State Bar No. 15154300 CARDELLI LANFEAR, P.C.
Oake Law Office 322 W. Lincoln
700 S. Central Expy., Suite 400 Royal Oak, MI 48067
Allen, Texas 75013 (248) 544-1100
(214) 207-9066, rgo@oake.com pkittinger@cardellilaw.com

Attorneys for ABPA

April 27, 2018


UNITED STATES COURT OF APPEALS FOR THE FEDERAL CIRCUIT

Automotive Body Parts Association v. Ford Global Technologies, LLC


18-1613

CERTIFICATE OF INTEREST

Counsel for Plaintiff-Appellant certifies the following:

1. The full name of every party or amicus represented by me is:

Automotive Body Parts Association

2. The real name of the real party in interest (if the party named in the caption
is not the real party in interest) represented by me is:

None

3. All parent corporations and any publicly held companies that own 10 percent
or more of the stock of the party or amicus curiae represented by me are:

None

4. The names of all law firms and the partners or associates that appeared for
the party or amicus now represented by me in the trial court or agency or are
expected to appear in this court (and who have not or will not enter an appearance
in this case) are:

CARDELLI LANFEAR, P.C., Thomas G. Cardelli

5. Pursuant to Federal Circuit Rule 47.5, Appellant states as follows:

(a) A Petition for Writ of Mandamus was filed previously in this case
titled In re: Automotive Body Parts Association, Petitioner, 2015-156. An order
issued November 17, 2015 denying the petition. The composition of the panel was
Judge Lourie, Judge Dyk, and Judge Hughes, order by Judge Dyk. The order is
nonprecedential and unreported.

i
(b) The title and number of any case known to counsel to be pending in
this or any other court that will directly affect or be directly affected by this court’s
decision in the pending appeal:

(1) New World International, Inc., and National Auto Parts, Inc., v. Ford
Global Technologies, LLC and Ford Motor Company; 17-1956, pending in the
United States Court of Appeals for Federal Circuit (combined petition for panel
rehearing and rehearing en banc filed April 26, 2018).

(2) Ford Global Technologies, LLC v. New World International, Inc., et al.,
case number 3:17-cv-03201, pending in the United States District Court for the
Northern District of Texas.

April 27, 2018 /s/ Robert G. Oake, Jr.


Robert G. Oake, Jr.
Attorney for Plaintiff-Appellant

ii
TABLE OF CONTENTS

Page

TABLE OF AUTHORITIES ………………………………… v

STATEMENT OF RELATED CASES …………………………. xi

JURISDICTION ……………………………………………… 1

STATEMENT OF THE ISSUES ………………………………… 2

STATEMENT OF THE CASE ………………………………… 3

STATEMENT OF FACTS ………………………………… 5

SUMMARY OF ARGUMENT ………………………………… 8

STANDARDS OF REVIEW ………………………………… 11

ARGUMENT ……………………………………………………… 12

I. The Subject Design Patents are Invalid because they are


Functional and therefore not Ornamental ..................................... 12

A. Introduction .............................................................................. 12

B. General Legal Principles - Ornamental and Functionality... 12

C. Cases Developing and Discussing Other Functionality


Factors …………………………………………………… 15

D. List of Additional Functionality Factors from Cases ……. 17

E. Additional Functionality Factors Applied to the Hood


and Headlamp ……………………………………………. 18

F. The Subject Design Patents are Invalid under this Court’s


Rationale and Holding in Best Lock ……………………… 19

iii
G. The District Court Erred in Holding that the Patented
Designs are not Functional ……………………………… 22

H. The Claimed Designs are not a Matter of Concern …….. 30

I. Alternatively, the Subject Claimed Designs can be


Considered Ornamental and Valid in the Initial Sales
Market, but Functional and Unenforceable in the
Repair/Replacement Market …………………………….. 36

J. Patent Invalidity due to Functionality is an Issue of Law 38

II. The Subject Patents Are Unenforceable due to Patent Exhaustion,


Implied License, and the Right to Repair ………………………. 39

A. Introduction ......................................................................... 39

B. Patent Exhaustion and Implied License Legal Principles ... 39

C. Patent Exhaustion Exists in This Case …………………… 43

D. The District Court’s Analysis is Incorrect that the Subject


Patents were not Exhausted ……………………………… 45

E. Authorized Sale of the F-150 Created an Implied License


that included the Right to Repair the F-150 and Purchase
Repair Parts ………………………………………………. 55

F. The “Have Made” Rights of F-150 Truck Purchasers


Protect the Manufacturer of Repair Parts and Others
in the Distribution Chain …………………………………. 58

CONCLUSION AND RELIEF SOUGHT …………………………… 58

CERTIFICATE OF COMPLIANCE …………………………………… 60

ADDENDUM …………………………………………………………... 61

CERTIFICATE OF SERVICE

iv
TABLE OF AUTHORITIES

CASES Pages(s)

Aiken v. Manchester Print Works,


1 F. Cas. 245 (C.C.D.N.H. 1865) ………………… 46, 47, 48, 51, 53,
54
Aro Mfg. Co. v. Convertible Top Replacement Co.,
365 U.S. 336 (1961) ……………………………… 42

Avia Group International Inc. v. L. A. Gear California Inc.,


853 F.2d 1557 (Fed. Cir. 1988) ……………………….. 30

Berry Sterling Corp. v. Pescor Plastics, Inc.,


122 F.3d 1452 (Fed. Cir. 1997) ……………………….. 14, 29

Best Lock Corp. v. Ilco Unican Corp.,


94 F.3d 1563 (Fed Cir. 1996) ……………………….. Passim

Best Lock Corp. v. Ilco Unican Corp.,


896 F.Supp. 836 (S.D. Ind., 1995) ………………… 19

Bottom Line Management, Inc. v. Pan Man, Inc.,


228 F.3d 1352 (Fed. Cir. 2000) ………………………... 41

Bowman v. Monsanto Co.,


569 U.S. 278 (2013) ………………………………. 46

Brunswick Corp. v. British Seagull Ltd.,


35 F.3d 1527 (Fed. Cir. 1994) ………………………... 25, 27

Carborundum Co. v. Molten Metal Equip. Innovs.,


72 F.3d 872 (Fed. Cir. 1995) ………………………… 56, 57

Chrysler Corp v. Vanzant,


44 F.Supp.2d 1062 (C.D. Cal. 1999) ………………….. 37

Chrysler Motors Corp. v. Auto Body Panels of Ohio, Inc.,


908 F.2d 951 (Fed. Cir. 1990) ………………………… 13

v
Classen Immunotherapies, Inc. v. Elan Pharm., Inc.,
786 F.3d 892 (Fed. Cir. 2015) ………………………… 11

CoreBrace LLC v. Star Seismic LLC,


566 F.3d 1069 (Fed. Cir. 2009) ………………………... 42, 45, 58

Deere & Co. v. Farmhand, Inc.,


560 F.Supp. 85 (SD Iowa 1982), aff'd,
721 F.2d 253 (8th Circuit, 1983) …………………. 25, 26

Egyptian Goddess, Inc. v. Swisa, Inc.,


543 F.3d 665 (Fed. Cir. 2008) (en banc) …………... 29

Ethicon Endo-Surgery, Inc. v. Covidien, Inc.,


796 F.3d 1312 (Fed. Cir. 2015) …………………. 14

Gorham v. White,
81 U.S. 511 (1871) ……………………………….. 32

Hale v. Dep't of Transp., Fed. Aviation Admin.,


772 F.2d 882 (Fed. Cir. 1985) ………………………… 11

Helferich Patent Licensing, LLC v. N.Y. Times Co.,


778 F.3d 1293 (Fed. Cir. 2015) ………………………… 47

Hewlett-Packard Co. v. Repeat-O-Type Stencil Mfg. Corp.,


123 F.3d 1445 (Fed. Cir. 1997) ………………………… 41

Hupp v. Siroflex of Am., Inc.,


122 F.3d 1456 (Fed. Cir. 1997) ………………………… 39

In re Carletti,
328 F.2d 1020 (CCPA 1964) ………………………… 13, 17

In re Morton-Norwich Products, Inc.,


671 F.2d 1332 (CCPA 1982) ………………………… 29

In re Skvorecz,
580 F.3d 1262 (Fed. Cir. 2009) ………………………… 12

vi
In re Stevens,
173 F.2d 1015 (CCPA 1949) ………………………… 34

In re Webb,
916 F.2d 1553 (Fed. Cir. 1990) ………………………… 34, 35, 36

In re Zahn,
617 F.2d 261 (Fed. Cir. 1980) ………………………… 32, 52

Intel Corp. v. Broadcom Corp.,


173 F. Supp. 2d 201 (D. Del. 2001) …………………. 42, 45

Intel Corp. v. ULSI Sys. Technology, Inc.,


995 F.2d 1566 (Fed. Cir. 1993) ………………………… 41

Inwood Laboratories, Inc. v. Ives Laboratories, Inc.


456 U.S. 844 (1982) ……………………………….. 24

Jazz Photo Corp. v. Int'l Trade Comm.,


264 F.3d 1094 (Fed. Cir. 2001) ………………………… 40, 41, 43, 44

Jazz Photo Corp. v. U.S.,


439 F.3d 1344 (Fed. Cir. 2006) ………………………… 11

Keene v. Paraflex Industries, Inc.,


653 F.2d 822 (3d Cir.1981) ………………………… 26

Kendall Co. v. Progressive Medical Technology, Inc.,


85 F.3d 1570 (Fed. Cir. 1996) ………………………… 41, 44, 45, 55

Keurig, Inc. v. Sturm Foods, Inc.,


732 F.3d 1370 (Fed. Cir. 2013) ………………………… 40, 43

L. A. Gear Inc. v. Thom McAn Shoe Co.,


988 F.2d 1117 (Fed. Cir. 1993) ………………………… 11, 14

Lexmark Int'l, Inc. v. Impression Prods., Inc.,


816 F.3d 721 (Fed. Cir. 2016) ………………………… 40

vii
LifeScan Scotland, Ltd. v. Shasta Techs., LLC,
734 F.3d 1361 (Fed. Cir. 2013) ………………………… 42

McCoy v. Mitsuboshi Cutlery, Inc.,


67 F.3d 917 (Fed. Cir 1995) ………………………… 41, 44, 45

Markman v. Westview Instruments, Inc.,


52 F.3d 967 (Fed. Cir. 1995) ………………………… 39

Met-Coil Systems Corp. v. Korners Unlimited, Inc.,


803 F.2d 684 (Fed. Cir. 1986) ………………………… 56

Morgan Envelope Co. v. Albany Perforated


Wrapping Paper Co., 152 U.S. 425 (1894) …………… 47

Patlex v. Mossinghoff,
758 F.2d 594 (Fed. Cir. 1985) ………………………… 13

Qualitex v. Jacobson Products,


514 U.S. 159 (1995) ……………………………….. 24, 25, 27

Quanta Computer Inc. v. LG Electronics, Inc.,


553 U.S. 617 (2008) ……………………………….. 42, 43, 49, 50, 55,
58
Richardson v. Stanley Works, Inc.,
597 F. 3d 1288 (Fed. Cir. 2010) ………………………… 38

Samsung Elecs. Co. v. Apple Inc.,


137 S.Ct. 429, 434, 196 L.Ed.2d 363 (2016) …………… 43, 53

Sandvik Aktiebolag v. E.J. Co.,


121 F.3d 669 (Fed. Cir. 1997) ………………………… 41

Static Control Components v. Lexmark International,


697 F.3d 387 (6th Cir. 2012) ………………………… 15, 32, 35, 36, 38

Static Control Components v. Lexmark International,


487 F.Supp.2d 830 (E.D. Ky. 2007) …………………. 15, 31

viii
Therma-Scan, Inc. v. Thermoscan, Inc.,
295 F.3d 623 (6th Cir. 2002) ………………………… 11

Torspo Hockey Intern., Inc. v. Kor Hockey Ltd.,


491 F. Supp.2d 871 (D. Minn. 2007) ………………… 38

United States v. Univis Lens Co.,


316 U. S. 241 (1942) ………………………………. 50

Wilson v. Simpson,
50 U.S. 109 (1850) ………………………………. 47

STATUTES

28 U.S.C. § 1295(a)(1) ……………………………………… 1

28 U.S.C. § 1338 …………………………………………….. 1

28 U.S.C. § 1338(a) ……………………………………… 1

28 U.S.C. § 1404(a) ……………………………………… 3

35 U.S.C. § 101 …………………………………………….. 52, 53

35 U.S.C. § 171 …………………………………………….. 2, 12, 13

35 U.S.C. § 171(a) …………………………………………….. 43, 52, 53

35 U.S.C. § 289 …………………………………………….. 43, 53

RULES

Fed. R. Civ. P. 4(a)(1)(A) ………………………………. 1

Fed. R. Civ. P. 56(f)(1) ……………………………………… 2, 3

Fed. R. Civ. P. 56 …………………………………………….. 1, 4

Fed. R. Civ. P. 56(a) ……………………………………… 11

ix
SECONDARY AUTHORITY

(MPEP) section 1504.01(c) ……………………………….. 12, 13

Restatement (Third) of Unfair Competition § 17, Com c (1993) 25

x
STATEMENT OF RELATED CASES

Pursuant to Federal Circuit Rule 47.5, Appellant states as follows:

(a) A petition for writ of mandamus was filed previously in this case
titled In re: Automotive Body Parts Association, Petitioner, 2015-156. An order
issued November 17, 2015 denying the petition. The composition of the panel was
Judge Lourie, Judge Dyk, and Judge Hughes, order by Judge Dyk. The order is
nonprecedential and unreported.

(b) The title and number of any case known to counsel to be pending in
this or any other court that will directly affect or be directly affected by this court’s
decision in the pending appeal:

(1) New World International, Inc., and National Auto Parts, Inc., v. Ford
Global Technologies, LLC and Ford Motor Company; 17-1956, pending in the
United States Court of Appeals for Federal Circuit (combined petition for panel
rehearing and rehearing en banc filed April 26, 2018).

(2) Ford Global Technologies, LLC v. New World International, Inc., et al.,
case number 3:17-cv-03201, pending in the United States District Court for the
Northern District of Texas.

xi
JURISDICTION

Appellant and Plaintiff below, Automotive Body Parts Association (APBA),

appeals from an order entered February 20, 2018 (Appx93-117) denying ABPA’s

motion for summary judgment (Appx1021-1022) in the United States District

Court for the Eastern District of Michigan in Automotive Body Parts Association v.

Ford Global Technologies, LLC, Civil Action No. 2:15-cv-10137, and a final

judgment (Appx91) entered February 23, 2018 in the same action in favor of Ford

Global Technologies, LLC (FGTL). The District Court entered the final judgment

pursuant to Federal Rule of Civil Procedure 56.

The determinations set forth above became final for the purposes of appeal

when the district court entered final judgment on February 23, 2018 (Appx91).

Pursuant to Federal Rule of Civil Procedure 4(a)(1)(A), ABPA filed a Notice of

Appeal on February 23, 2018 (Appx2415-2416).

This Court has jurisdiction under 28 U.S.C. § 1295(a)(1), granting it

exclusive jurisdiction over final determinations of a district court if the jurisdiction

of that court was based, in whole or in part, on 28 U.S.C. § 1338. The District

Court of the Eastern District of Michigan had subject matter jurisdiction over this

action under 28 U.S.C. § 1338(a), as the action arose under Title 35.

1
STATEMENT OF THE ISSUES

(1) Whether the district court erred in denying ABPA’s motion for

summary judgment, which argued that Design Patents D489,299 and D501,685 are

invalid under 35 U.S.C. § 171 because the claimed designs are functional and

therefore not ornamental.

(2) Whether the district court erred in granting summary judgment for

FGTL under Fed. R. Civ. P. 56(f)(1) by holding that Design Patents D489,299 and

D501,685 are not invalid under 35 U.S.C. § 171 because the claimed designs are

not functional and therefore ornamental.

(3) Whether the district court erred in denying ABPA’s motion for

summary judgment, which argued that Design Patents D489,299 and D501,685 are

unenforceable under the patent exhaustion doctrine and associated doctrines of

repair and implied license.

(4) Whether the district court erred in granting summary judgment for

FGTL under Fed. R. Civ. P. 56(f)(1) by holding that Design Patents D489,299 and

D501,685 are enforceable and not exhausted under the patent exhaustion doctrine

and associated doctrines of repair and implied license.

2
STATEMENT OF THE CASE

ABPA sued FGTL for a declaration of patent invalidity, unenforceability,

and non-infringement in the Eastern District of Texas, Civil Action No. 4:13-cv-

705 (Appx119). FGTL filed a motion to dismiss for lack of standing (Appx194),

which was denied (Appx970-978). FGTL filed a motion to transfer venue under

28 U.S.C. § 1404(a) to the Eastern District of Michigan. (Appx123). ABPA filed

an amended complaint (Appx979-985) and FGTL answered. (Appx986-996).

FGTL’s motion to transfer venue was granted. (Appx997-1010).

ABPA filed a motion for summary judgment regarding functionality, patent

exhaustion, repair, and implied license (Appx1021-1022), FGTL opposed

(Appx1228), and ABPA replied (Appx1476). The Court requested briefing on

whether the case was moot (Appx1485) and the parties responded (Appx135).

FGTL filed a motion to dismiss the case as moot (Appx1522), ABPA responded

(Appx1565), and FGTL replied (Appx1780). The Court ordered supplemental

briefing on mootness (Appx1801) and the parties responded (Appx1803,

Appx1890). The Court denied FGTL’s motion to dismiss the case as moot,

denied ABPA’s motion for summary judgment, and provided notice to ABPA that

the Court was intending to enter judgment in favor of FGTL pursuant to Rule

56(f)(1) (Appx93-117). ABPA responded to the Notice. (Appx2146-2150).

Summary Judgment was granted for FGTL on the issues of functionality, patent

3
exhaustion, repair, and implied license under Federal Rule of Civil Procedure 56.

(Appx91). ABPA timely filed a Notice of Appeal (Appx2415-2416). This appeal

followed.

4
STATEMENT OF FACTS

Ford Motor Company (hereinafter “Ford”) is a manufacturer and seller of,

inter alia, automobiles and automotive parts. (Appx1058). Ford designed,

manufactured, and sold the F-150 Pickup Truck in the United States. (Appx1085,

Appx1062-1064). Ford Global Technologies LLC (FGTL) is a subsidiary of Ford

Motor Company. FGTL owns and manages the intellectual property of Ford.

(Appx1058). FGTL is the owner of United States Design Patent D489,299

("Exterior of Vehicle Hood") (“the ‘299 Patent") (Appx174-182) and D501,685

(Vehicle Head Lamp) (“the ‘685 Patent”) (Appx183-193).

Since the Ford F-150 Truck (F-150) must be designed before it is built and

sold, the design decisions that go into making the F-150 all are completed before

the F-150 Truck is built and purchased. A model of the F-150 is built with a hood

and a headlamp embodying what FGTL alleges are designs claimed in the ‘299

Patent and the ‘685 Patent. Once the hood and headlamp are designed for

installation on the original vehicle, no additional design work is needed to design

repair parts that match the original design.

F-150 Trucks sometimes are involved in collisions and need repair.

(Appx1089-1090). It is important and necessary to match the appearance of the

repair part with the original pre-collision part on the vehicle so that the vehicle is

returned back to its original condition and appearance. (Appx1089-1090). The

5
only role that design plays in an owner's decision to buy such a part is that the

design must match the design of the original part to return the vehicle back to its

original condition and appearance. (Appx1089-1090). Vehicle repair parts such as

a Ford F-150 hood and headlamp ultimately are sold to, and the repairs are

performed on behalf of, the owner of the Ford vehicle being repaired. (Appx1088).

Most vehicle repairs are paid for by an insurance company and the insurance

company usually has an obligation under the insurance policy to pay for repair that

restores the damaged vehicle to its pre-loss condition, i.e., operational safety,

function, and appearance. (Appx1090).

ABPA is a non-profit corporation organized and existing under the laws of

the State of Texas. ABPA members, including New World International, Inc.

(New World) distribute aftermarket repair parts in the automotive collision repair

trade. (Appx1200).

New World purchases repair parts from a manufacturer or distributor and

then sells it to a person or entity needing the parts for repair of the Ford F-150 or

Mustang. (Appx1200). The person or entity purchasing the repair part from New

World may be, for example, the owner of the vehicle or a repair facility.

(Appx1200-1201). The repair parts are always sold for the purpose of repairing the

vehicles and are never sold for any other purpose. (Appx1201). The repair parts

are not sold to reconstruct an essentially new vehicle. Rather, the repair parts are

6
sold to repair a vehicle. (Appx1201). If damage to a F-150 Truck, Mustang, or

other vehicle is so extensive that essentially a new vehicle has to be reconstructed,

the vehicle will not be repaired. That is because the cost of the reconstruction will

greatly exceed the cost of purchasing another F-150 Truck, Mustang, or other

vehicle. (Appx1201).

7
SUMMARY OF ARGUMENT

(1) The ‘299 and ‘685 design patents are invalid because they are functional and

therefore not ornamental. The claimed designs are functional because they are

dictated by function and not a matter of concern either during F-150 purchase or

when purchased for F-150 repair. The subject patents are dictated by function

because the claimed designs are sold as a combination with other F-150 parts, the

designs are dictated by their need to mate and match with the overall appearance of

the F-150 when sold, and the designs are dictated by their need to bring the F-150

back to its original appearance when purchased as a repair/replacement part.

This is a “mate and match” case because the subject claimed designs

allegedly are embodied in parts sold as a combination with other parts when the F-

150 is initially sold. In mate and match cases, such as a combination key and lock

interface design or a printer and printer cartridge design, this Court’s inquiry into

functionality does not focus on the initial design process, but rather after the

combination has been designed. Since the subject patent designs must be designed

a certain way to work with the combination, there are no decorative design choices

to be made.

The function of the claimed designs includes their appearance, or “aesthetic

functionality.” It is appropriate to consider aesthetic functionality when

determining whether the subject designs are functional because the ultimate issue

8
is whether there are alternative designs that allow a conscious design choice to be

made. If no conscious design choices are made, then it should not matter whether

the lack of choice is due to mechanical or so called "utilitarian" factors, or whether

the lack of choices is due to appearance. Further, when a design is the result of

functional necessity and not the result of decorative design choices, granting a

design patent to such a function-dictated design does not serve the purpose of

promoting the decorative arts. The aesthetic functionality doctrine is accepted in

trademark law, and there are good reasons to accept it in design patent law as well.

The subject claimed designs are not a matter of concern because since the

functionality focus is on the mate and match combination, the initial F-150

purchaser only wants the claimed designs to mate and match with the rest of the

combination. Further, the subject claimed designs are not a matter of concern

when repair/replacement parts are being purchased because the purchaser only is

concerned that the parts match the appearance of the original parts and the parts

can be purchased by part number.

Alternatively, since there are two markets for parts embodying the subject

designs (the initial sales market for the F-150 and the repair/replacement market),

this Court can adopt the principle in trademark law that the design can be

considered ornamental and valid in the initial sales market, but functional and

unenforceable in the repair/replacement market.

9
(2) The claimed designs allegedly are embodied in the F-150 when it is sold.

Therefore, the authorized sale of the F-150 exhausts the claimed designs and

creates an implied license allowing the purchaser to repair the F-150 by purchasing

repair/replacement parts that allegedly embody the claimed designs. The rule in

utility patent law that an article cannot be repaired by replacing a separately

patented component part does not apply in design patent law because, unlike utility

patent law, a patented design may be embodied in both a parent article of

manufacture and one of its component parts.

A F-150 purchaser has a reasonable expectation that the implied license

includes a right to repair the F-150 free from any threat of design patent

infringement allegations due to the circumstances of the sale. Neither Ford nor

FGTL place any restrictions on the implied license and the hood and headlamp are

not marked with design patent numbers. Based on this reasonable expectation, and

FGTL’s lack of action or notice to dissuade this reasonable expectation, the scope

of the implied license extends to repairing the F-150 with the repair/replacement

parts allegedly embodying the claimed designs. Finally, since the owner of the F-

150 has an implied license to repair the F-150, the owner also has “have made”

rights that shields the manufacture of the repair part and all members of the

distribution chain from liability for patent infringement.

10
STANDARDS OF REVIEW

This Court applies the law of the regional circuit when reviewing a district

court's grant of summary judgment. See Classen Immunotherapies, Inc. v. Elan

Pharm., Inc., 786 F.3d 892, 896 (Fed. Cir. 2015). The Sixth Circuit reviews a

district court's grant of summary judgment de novo. Therma-Scan, Inc. v.

Thermoscan, Inc., 295 F.3d 623, 629 (6th Cir. 2002). Summary judgment is

appropriate if "the movant shows that there is no genuine dispute as to any material

fact and the movant is entitled to judgment as a matter of law." Fed. R. Civ. P.

56(a).

Invalidity due to functionality is an affirmative defense to a claim of

infringement of a design patent, and must be proved by the party asserting the

defense by clear and convincing evidence. L.A. Gear, Inc. v. Thom McAn Shoe

Co., 988 F.2d 1117, 1123 (Fed. Cir. 1993).

Patent exhaustion is an affirmative defense that ABPA must prove by a

preponderance of the evidence. Jazz Photo Corp. v. U.S., 439 F.3d 1344, 1350

(Fed. Cir. 2006). Preponderance of the evidence in civil actions means "the greater

weight of evidence, evidence which is more convincing than the evidence which is

offered in opposition to it." Hale v. Dep't of Transp., Fed. Aviation Admin., 772

F.2d 882, 885 (Fed. Cir. 1985). ABPA may carry its burden of proving patent

exhaustion based on circumstantial evidence. Jazz Photo, 439 F. 3d at 1351.

11
ARGUMENT

I. THE SUBJECT DESIGN PATENTS ARE INVALID BECAUSE THEY


ARE FUNCTIONAL AND THEREFORE NOT ORNAMENTAL

A. Introduction

ABPA’s argument for why the subject design patents are not ornamental will

begin with a discussion of general legal principles. Functionality factors developed

in case law will be discussed and applied. The facts will be analyzed in light of

Best Lock Corp. v. Ilco Unican Corp., 94 F.3d 1563 (Fed Cir. 1996), which is a

case involving mate and match principles where this Court invalidated a key blade

design patent based on functionality. The argument then will explain why the

District Court erred in holding that the subject design patents were not functional

and not invalid. The argument will conclude with an alternative argument that

does not invalidate the design patents based on functionality, but rather renders

them unenforceable against repair/replacement parts.

B. General Legal Principles - Ornamental and Functionality

The current design patent statute, 35 U.S.C. § 171, provides in relevant part

"[w]hoever invents any new, original and ornamental design for an article of

manufacture may obtain a patent therefor...." Manual of Patent Examining

Procedure (MPEP) section 1504.01(c) entitled “Lack of Ornamentality,”1 states

1
The MPEP does not have the force of law, but it is made available to the public
and describes “procedures on which the public can rely.” In re Skvorecz, 580 F.3d

12
“[t]herefore, for a design to be ornamental within the requirements of 35 U.S.C.

171, it must be ‘created for the purpose of ornamenting.’” (emphasis in original)

(citing In re Carletti, 328 F.2d 1020, 1022 (CCPA 1964). The court in In re

Carletti explained: “But it has long been settled that when a configuration is the

result of functional considerations only, the resulting design is not patentable as an

ornamental design for the simple reason that it is not ‘ornamental’ - was not

created for the purpose of ornamenting.” Id. (emphasis added). This statement

expresses the principle that when a design results from functional considerations

only, a designer has not made any conscious ornamental design choices and the

design is not entitled to patent protection. Indeed, MPEP 1504.01(c) states in

relevant part "[i]t is clear that the ornamentality of the article must be the result of

a conscious act by the inventor, as 35 U.S.C. 171 requires that a patent for a design

be given only to 'whoever invents any new, original, and ornamental design for an

article of manufacture.'” (emphasis added).

In Chrysler Motors Corp. v. Auto Body Panels of Ohio, Inc., 908 F.2d 951

(Fed. Cir. 1990), this Court stated "[t]he question of when the functionality of a

design so permeates an article of manufacture that design patent protection is not

available under the law is a complex issue and one that continues to be the subject

of considerable judicial attention." Id. at 954. This Court’s approach to this

1262, 1268 (Fed. Cir. 2009) (quoting Patlex v. Mossinghoff, 758 F.2d 594, 606
(Fed. Cir. 1985)).

13
"complex issue" has been to develop a framework of general principles that

includes a developing and non-exclusive list of factors to consider.

In L. A. Gear Inc. v. Thom McAn Shoe Co., 988 F.2d 1117 (Fed. Cir. 1993),

this Court stated "[w]hen there are several ways to achieve the function of an

article of manufacture, the design of the article is more likely to serve a primarily

ornamental purpose." Id. at 1123. However, this Court has been careful to explain

that the presence or absence of alternative designs is just one factor to consider and

that it does not carry dispositive weight. In Berry Sterling Corp. v. Pescor

Plastics, Inc., 122 F.3d 1452 (Fed. Cir. 1997), this Court stated “alternative designs

join the list of other appropriate considerations for assessing whether the patented

design as a whole -- its overall appearance -- was dictated by functional

considerations” and “[o]ther appropriate considerations might include: whether the

protected design represents the best design; whether alternative designs would

adversely affect the utility of the specified article; whether there are any

concomitant utility patents; whether the advertising touts particular features of the

design as having specific utility; and whether there are any elements in the design

or an overall appearance clearly not dictated by function.” Id. at 1456.

In Ethicon Endo-Surgery, Inc. v. Covidien, Inc., 796 F.3d 1312 (Fed. Cir.

2015), this Court stated "an inquiry into whether a claimed design is primarily

functional should begin with an inquiry into the existence of alternative designs,"

14
id. at 1330, but reaffirmed it has "not mandated applying any particular test for

determining whether a claimed design is dictated by its function and therefore

impermissibly functional." Id. at 1329.

C. Cases Developing and Discussing Other Functionality Factors

Cases from this Court and other courts indicate that the list of functionality

factors is continuing to develop and that other factors also are considered relevant

on functionality. For example, several cases discuss the importance of "mate and

match" principles. In Best Lock, supra, the design patent was for a key blade,

which is the portion of the key designed to fit into the matching front face of a

keyway. This Court held that since the key blade had to be designed to fit into the

matching keyway, the design of the key blade was dictated solely by its function,

meaning that there were no decorative design choices to be made. This Court

found the design was not ornamental and held the patent invalid.

In Static Control Components v. Lexmark International, 697 F.3d 387 (6th

Cir. 2012), a case involving printers and replacement toner cartridges, the design

patent in question covered the toner cartridge. The district court found on motion

for summary judgment that the design patent was invalid based on two theories.

First, since the toner cartridges were generally hidden from view inside the printer,

the district court found "the appearance of Lexmark's printer cartridges in question

are [sic] of no matter of concern during those cartridges' entire existence." Static

15
Control Components v. Lexmark Intern., 487 F.Supp.2d 830, 839 (E.D. Ky. 2007).

Second, the court held the design patent invalid because the toner cartridge design

was primarily functional in that the “printers dictate the design of the printer

cartridges." Id. at 841. The Sixth Circuit affirmed the district court on both

counts, stating:

The district court applied the correct standard and evaluated the
undisputed facts offered by Static Control establishing that the design
of the cartridges was functional and not ornamental. The toner
cartridges are visible to users at some points, but are generally hidden
from view inside the printer. Their design is dictated solely by the
printer with which they are compatible. Lexmark itself explained that
the advertisements containing photographs were primarily to assist the
customer in selecting the cartridge that was compatible with the
printer they owned. The cartridges' appearance had no other role in
the purchaser's decision of which cartridge to purchase.

Id. at 422. (footnote and record reference omitted). The district court, when ruling

the design patents were invalid due to functionality, considered it important that

"[the patentee's] own averments emphasize that the consumer is locked into buying

a certain replacement cartridge in order for his printer to operate" 487 F.Supp.2d at

840, and "customers can purchase replacement cartridges for printers online by

model number; printers are generally shipped with the correct toner cartridge

already installed." Id. at 841.

Beyond "mate and match" principles, another line of cases developing

additional functionality factors has held design patents invalid because the design

had to look a certain way to comply with governmental regulations, industry

16
standards, or other requirements. A case example of the “specifications and

standards” situation is In re Carletti, 328 F.2d 1020 (CCPA 1964), which involved

a design patent covering a gasket. The court held the patent invalid because the

only differences between the claimed design and the prior art were functional and

the gasket design was standardized in a military specification that dictated “the

exact position, dimensions, and tolerances of the grooves and ribs etc., without the

slightest suggestion that they serve in any way as ornamentation.” Id. at 1021.

D. List of Additional Functionality Factors from Cases

The cases cited above have produced additional factors to consider when

determining whether a design is functional, including the following: First, when

the claimed design of the article of manufacture (or portion thereof) is designed to

fit into or onto a parent article of manufacture. Second, when the article of

manufacture typically is sold with the parent and will need replacing during the

useful life of the parent article due to foreseeable damage, use, or loss of the article

of manufacture or parent. Third, when the design of the article of manufacture is

dictated by its need to mate with and match the appearance of the parent due to

functional necessity or other requirements such as insurance policy requirements.

Fourth, when the appearance of the design has no other role in the purchaser's

decision other than to be compatible with another article of manufacture. Fifth,

when customers typically can purchase the repair/replacement article of

17
manufacture by part number rather than by the appearance of the article of

manufacture.

Significantly, when evaluating the functionality of a design in a mate and

match context, the focus is not on potential alternative designs that might be

created during the design process, but rather on the practical mate and match

compatibility after the designs are created and whether alternative designs exist

that will mate and match with the complementary or parent article. For example,

in Best Lock, although it was possible to create many different key blade – keyway

design interfaces during the design process, this Court found functionality by

examining how many key blade designs were possible after the original design had

been selected.

E. Additional Functionality Factors Applied to the Hood and Headlamp

Application of the additional functionality factors to the subject patents leads

to the conclusion that the subject patents are functional and invalid. The hood and

headlamp that FGTL alleges to embody the subject portion claims2 are designed to

fit into or onto a F-150 body. The hood and headlamp are sold with the F-150 and

typically may need repair or replacing during the useful life of the F-150 due to

foreseeable collision damage. (Appx2222-2224). The portion designs of the hood

2
To be clear, all comparisons between the accused parts and the subject claimed
designs should be understood as being based on FGTL’s allegations that the
accused parts infringe the claimed designs and not upon a concession by ABPA
that infringement is occurring.

18
and headlamp are dictated by their need to mate with and match the overall

appearance of the F-150 due to functional necessity and other requirements,

including insurance policy requirements. (Appx2223-2224).

The appearance of the hood and headlamp designs have no other role in the

purchaser's decision to buy them other than to be compatible with the overall F-150

appearance and to match the parts they are being used to repair/replace.

(Appx2223-2224). Finally, a repair/replacement hood and headlamp typically is

purchased solely by part number. (Appx1107, Appx1118). Since the hood and

headlamp designs at issue fit the above criteria for invalidity, the '299 and '685

Patents should be considered invalid due to functionality. An analysis of the facts

of this case under this Court’s holding in Best Lock confirms this is so.

F. The Subject Design Patents are Invalid under this Court’s Rationale
and Holding in Best Lock

In Best Lock Corp. v. Ilco Unican Corp., 896 F.Supp. 836 (S.D. Ind., 1995),

a design patent covered a portion of a key blade that inserts into a keyway. The

district court held the design patent was invalid for two reasons. First, it found that

the key blades were not "a matter of ornamental concern to the purchaser or the

user." Id. at 843. Second, it “found that the design patent was invalid because the

shape of the blank key blade was dictated by its function.” Id.

On appeal, plaintiff/appellant argued that since “an unlimited number of

key blade and corresponding keyway designs are available,” the design claimed for

19
the key blade is ornamental because it “is not dictated solely by functional

concerns.” 94 F.3d at 1566. This Court rejected appellant’s argument, explaining:

Further, Best Lock's assertion that a variety of possible shapes of


interfaces between keys and locks exists does not compel a different
result. Clearly, different interfaces between key blades and
corresponding lock keyways can be designed to permit the
combination to function as a lock and key set. However, Best Lock's
patent does not claim the combination of a lock and corresponding
key. Instead, the claim in the '636 design patent is limited to a key
blade, which must be designed as shown in the '636 patent in order to
perform its intended function.

Id. at 1566.

Stated differently, although it may be permissible to patent the combination

of a given key blade and keyway design, an inventor is not allowed to divide the

combination and have a design patent on just the key blade when it must be

designed as shown to make the combination function as a lock and key set.

Significantly, this Court’s analysis did not focus on alternative designs that might

be created during the design process for the interface between the key blade and

keyway, but rather focused on the practical mate and match compatibility issues

after the designs were created.

A dissent by Judge Newman disagreed with the majority:

The parties to this litigation agree that there are myriad possible
designs of key profiles. All keys require, of course, mating keyways.
In holding that because the key must fit a keyway, the abstract design
of the key profile is converted to one solely of function, the court
creates an exception to design patent subject matter. An arbitrary

20
design of a useful article is not statutorily excluded from § 171 simply
because in use it interacts with an article of complementary design.
….
In sum, the fact that the key blade is the mate of a keyway does not
convert the arbitrary key profile into a primarily functional design. It
is not the design of the key profile that is functional, but the key itself.

Id. at 1569.

Under traditional design patent principles not involving mating and

matching, the Judge Newman had a good point - the patent on the key blade was

valid because it was an arbitrary and ornamental design of a useful article.

However, what made the key blade functional under mate and match principles

was that (1) it was designed with a complementary article (the keyway in the lock),

and (2) the key blade, including the replacement key blades, had to have a certain

design appearance to work with the keyway.

When the Best Lock analysis is applied to the instant case, the subject

patents are invalid as functional. First, just as the key blade and keyway are

designed together, so too are the hood and headlamp designed together with the

rest of the F-150 exterior. Second, just as the key blade and keyway are arbitrary

designs when considered as a combination, the hood, headlamp, and F-150 also are

arbitrary designs when considered as a combination. Finally, just as the key blade

and keyway purchaser in Best Lock needed a key blade that would mate and match

with the lock, so too does a purchaser of a F-150 need a hood and a headlamp that

21
will mate and match with the F-150 overall appearance and bring it back to its

original appearance and condition when damaged.

To be sure, a lock owner could purchase a differently designed replacement

key blade that could fit into the keyway (for example that was shorter, or that had

only half the vertical design), but the important point is that such a key blade

would not open the lock. Similarly, a F-150 owner can purchase a differently

designed hood and headlamp that could fit into the F-150, but the important point

is that it would not bring the F-150 back to its original condition and appearance.

Just as this Court did not allow the patentee in Best Lock to divide up the

combination of a key blade and keyway to obtain a design patent on just the key

blade, this Court also should not allow FGTL to divide up the combination F-150

design to obtain design patents on portions of the parts when the repair/

replacement parts must be designed a certain way to return the F-150 back to its

original condition and appearance.

G. The District Court Erred in Holding that the Patented Designs are not
Functional

The District Court cited evidence that hoods and headlamps with designs

different from the patented designs (performance parts) could be used to replace

the original parts embodying the patented designs. (Appx110). The District Court

then stated that the existence of such performance parts served to distinguish this

case from this Court’s opinion in Best Lock. (Appx111). According to the District

22
Court, “the existence of performance parts demonstrates that the designs claimed

in the ’299 and ’685 patents are not necessary for the hood and headlamp to

perform their intended functions.” (Appx111). This conclusion does not take into

consideration that the performance parts cited are not originally sold with the F-

150 and an important function of a repair/replacement hood and headlamp is to

return the F-150 back to its original condition and appearance, something a

performance part cannot do. The District Court considered this type of

functionality to be “aesthetic functionality,” and did not consider it. (Appx109).

The District Court in essence held that the appearance alone of the hood and

headlamp cannot be deemed functional unless there is a mechanical or "utilitarian"

aspect to the designs separate and apart from the functional need to match the F-

150 appearance. This holding constitutes error. As explained in the section setting

forth general principles, the ultimate issue is not whether there are other designs

that can perform the same mechanical or "utilitarian" function as the subject

design, but rather whether there are alternative designs that allow for a conscious

design choice to be made. If there are no conscious design choices to be made,

then it should not matter whether the lack of choices is due to so called "utilitarian"

factors, or whether the lack of choices is due to the appearance of the design.

A purpose of the claimed headlamp and hood designs is to be compatible

with the overall F-150 design aesthetic and to bring the F-150 back to its original

23
appearance if damaged. It is this need to match the F-150 appearance that dictates

the design by eliminating conscious design choices and makes it proper to include

appearance in the functionality analysis.

This conclusion is supported by the analogous concept of aesthetic

functionality in the field of trademarks. In Qualitex v. Jacobson Products, 514

U.S. 159 (1995), the Supreme Court discussed the issue of aesthetic functionality

in the context of whether the Lanham Act permitted the registration of a trademark

consisting of a color. The Court stated "the functionality doctrine prevents

trademark law, which seeks to promote competition by protecting a firm's

reputation, from instead inhibiting legitimate competition by allowing a producer

to control a useful product feature." Id. at 164. The Court stated further "[t]his

Court consequently has explained that, '[i]n general terms, a product feature is

functional,' and cannot serve as a trademark, 'if it is essential to the use or purpose

of the article or if it affects the cost or quality of the article,' that is, if exclusive use

of the feature would put competitors at a significant non-reputation-related

disadvantage. [citing] Inwood Laboratories, Inc., 456 U.S., at 850, n. 10, 102 S.Ct.,

at 2186, n. 10." Id. at 165.

The Court noted "that lower courts have permitted competitors to copy the

green color of farm machinery (because customers wanted their farm equipment to

match) and have barred the use of black as a trademark on outboard boat motors

24
(because black has the special functional attributes of decreasing the apparent size

of the motor and ensuring compatibility with many different boat colors)." Id. at

169 (citing Deere & Co. v. Farmhand, Inc., 560 F.Supp. 85, 98 (SD Iowa 1982),

aff'd, 721 F.2d 253 (CA8 1983) and Brunswick Corp. v. British Seagull Ltd., 35

F.3d 1527 (Fed. Cir. 1994)).

Finally, the Court quoted The Restatement (Third) of Unfair Competition

that, “if a design's ‘aesthetic value’ lies in its ability to ‘confe[r] a significant

benefit that cannot practically be duplicated by the use of alternative designs,’ then

the design is ‘functional.’ Restatement (Third) of Unfair Competition § 17,

Comment c, pp. 175-176 (1993).” Id. at 170. And “[t]he ‘ultimate test of aesthetic

functionality,’ it explains, ‘is whether the recognition of trademark rights would

significantly hinder competition.’ Id., at 176.” Id.

In the instant case, the ultimate question is not whether competition is

adversely affected, but rather whether there is a conscious design choice being

made that promotes the decorative arts. Since after the entire F-150 combination is

designed the claimed designs must appear a certain way to match the combination

and to bring it back to its original appearance if damaged, there are no design

choices to be made, the decorative arts are not promoted, and the designs are

functional. This conclusion is conceptually similar to the reasoning in two of the

cases noted by the Supreme Court in Qualitex.

25
In Deere & Co. v. Farmhand, Inc., 560 F.Supp. 85 (SD Iowa 1982), aff'd,

721 F.2d 253 (8th Cir. 1983), Plaintiff John Deere sued Defendant Farmhand in an

effort to prevent the sale of front-end loaders that were painted "John Deere green."

Id. at 88. Plaintiff argued that the appearance of the color green served no

functional purpose and therefore was protectable under the Lanham Act.

Defendant argued that the color green was aesthetically functional because farmers

preferred to match the color of their loaders to that of that tractors. The court

agreed with defendant that the color green was aesthetically functional under

reasoning found in Keene v. Paraflex Industries, Inc., 653 F.2d 822 (3d Cir.1981):

The Keene case involved the imitation of a commercial lighting unit


called the "Wall Cube." This lighting device was designed for
placement on apartment buildings and other commercial structures.
Paraflex Industries copied the design of the lighting fixture, but the
Third Circuit refused to enjoin Paraflex's sale of the product since it
was aesthetically functional. The lower court in Keene had held that
architectural compatibility between the lighting fixture and the design
of the building on which it is to be placed is often a significant criteria
of selection. Based on this finding, the Court of Appeals held that the
design configuration was not an arbitrary expression of aesthetics, but
was intricately related to its function of architectural compatibility.
[footnote omitted]

The Court concludes that the doctrine of aesthetic functionality should


apply to the dispute now before the Court. The Court has found that
farmers prefer to match their loaders to their tractor just as the lighting
fixture in Keene was designed to match the architecture of the
building on which it was mounted. [footnote omitted]

Id. at 98.

26
In sum, since the purchaser farmers wanted to match the appearance of their

loaders with the appearance of their tractors, the court considered design

appearance in the functionality analysis. Similarly, since repair part purchasers

want to match the appearance of the hoods and headlamps with the appearance of

the original parts to bring their vehicles back to their original condition and

appearance, this Court should consider the appearance of the hood and headlamp in

the functionality analysis.

A second case cited in Qualitex is Brunswick Corp. v. British Seagull Ltd.,

35 F.3d 1527 (Fed. Cir. 1994). In Brunswick, the Mercury Marine division of

Brunswick Corporation sought to register the color black for its outboard marine

engines. The Trademark Trial and Appeal Board concluded that the color black

was functional and not registerable, and stated:

[A]lthough the color black is not functional in the sense that it makes
these engines work better, or that it makes them easier or less
expensive to manufacture, black is more desirable from the
perspective of prospective purchasers because it is color compatible
with a wider variety of boat colors and because objects colored black
appear smaller than they do when they are painted other lighter or
brighter colors. The evidence shows that people who buy outboard
motors for boats like the colors of the motors to be harmonious with
the colors of their vessels, and that they also find it desirable under
some circumstances to reduce the perception of the size of the motors
in proportion to the boats.

Id. at 1529. This Court found no error in the Board's legal reasoning and no clear

error in its factual findings and stated:

27
The color black, as the Board noted, does not make the engines
function better as engines. The paint on the external surface of an
engine does not affect its mechanical purpose. Rather, the color black
exhibits both color compatibility with a wide variety of boat colors
and ability to make objects appear smaller. With these advantages for
potential customers, the Board found a competitive need for engine
manufacturers to use black on outboard engines. Based on this
competitive need, the Board determined that the color was de jure
functional.

Id. at 1531.

In sum, when determining whether there are alternative designs that can

perform the same function as the claimed designs, it is proper to consider the

aesthetic compatibility of the hood and headlamp with the F-150. Just as the

aesthetic compatibilities of the green loaders with green tractors, black engines

with surrounding boat colors, and wall cubes with surrounding architecture were

considered in the functionality analysis, so should the aesthetic compatibility of the

hood and headlamp design with the surrounding vehicle be considered in the

functionality analysis. Each is related and relevant to the ultimate issue of

importance in its respective field: competitive need in trademark law and conscious

design choice in design patent law.

The District Court declined to import the aesthetic functionality doctrine

from trademark law to design patent law for three reasons, each of which is

addressed as follows: First, regarding the point that no court yet has applied

aesthetic functionality to design patent law “despite that both trademarks and

28
design patents have coexisted for well over a century,” (Appx109), design patent

law currently is a rapidly developing and dynamic area of patent law. This Court

has not hesitated to change long standing precedent in the design patent area when

a strong argument was made that the law should be further developed or modified.

See Egyptian Goddess, Inc. v. Swisa, Inc., 543 F.3d 665 (Fed. Cir. 2008) (en banc)

(eliminating the “point of novelty” test that had existed in design patent law for

twenty-five years).

Further, this Court already has imported other important principles from

trademark functionality law into design patent functionality law because the

concepts are so similar. In Berry Sterling, supra, this Court imported trademark

functionality factors into design patent law. 122 F.3d at 1456. Although the court

cited no authority, several of the factors are similar to those listed in In re Morton-

Norwich Products, Inc., 671 F.2d 1332, 1340, 1341 (CCPA 1982) for determining

whether a trademark is functional.

Second, the District Court’s analysis that trademark law and design patent

law serve different purposes is incomplete because the purpose of design patent

law is not considered. The District Court states “trademark law ‘seeks to promote

competition’” and “[i]n contrast, patents inhibit competition,” (Appx109) but the

court does not consider that design patent law seeks to balance the promotion of

competition with promotion of the decorative arts, which is “a purpose of the

29
design patent statute.” See Avia Group International Inc. v. L. A. Gear California

Inc., 853 F.2d 1557, 1563 (Fed. Cir. 1988). The balance of these dual purposes is

reflected in the statutory requirement that a patentable design be "ornamental.”

These principles indicate that when a design is not the result of decorative design

choices, granting a design patent to such a function-dictated design would not

serve the purpose of promoting the decorative arts. As explained earlier, it does

not matter whether the decorative design choice is not available due to mechanical

or aesthetic reasons.

Finally, the District Court reasons that trademark law has a greater concern

over functionality than design patent law given the potential perpetual monopoly

over a product’s function. (Appx109-110). However, given that a design must be

ornamental to be patentable, a fifteen-year “monopoly” is granted for valid design

patents, and design patents have been used to establish secondary meaning to

obtain a trademark’s perpetual monopoly, functionality is very important in the

design patent context as well.

H. The Claimed Designs are not a Matter of Concern

The District Court also found the subject designs were not functional

because they were a “matter of concern” when the F-150 was purchased.

(Appx106). The District Court distinguished the rationale of the district court in

Best Lock, which found the key blade’s design was not a matter of concern because

30
it was never a matter of concern either during product use or purchase. In Best

Lock, this Court did not address the matter of concern issue because the designs

were found to be dictated by function, which is a similar but distinct requirement

from “matter of concern.” See Static Control, supra, 487 F. Supp. at 840 (“A

similar, though distinct, requirement to a patentable design being a matter of

concern at some point is that a patentable design cannot be dictated by

functionality.”). As discussed above, the subject designs are functional under this

Court’s reasoning in Best Lock because they are dictated by function, which makes

it unnecessary to address the issue of “matter of concern.” However, a “matter of

concern” analysis supports the finding of functionality as well.

Before the matter of concern issue is addressed, some background

information is helpful. Automotive companies such as Ford Motor Company (and

its associated company FGTL) are applying for and receiving design patents on the

exterior appearance of vehicles. Examples are U.S. Design Patent Nos. D500,462

"Pick Up Truck" (below left) (Appx3600-3603) and D504,356 "Pick Up Truck"

(below right) (Appx3604-3607):

31
Automotive companies also have applied for and received patents on parts of

the exterior design of vehicles such as the hood and headlamp designs involved in

this lawsuit. A design patent on a portion of a vehicle can protect the design from

copying by competitors who are attempting to avoid infringement by copying less

than the entire exterior design of the vehicle. However, Ford and FGTL are going

beyond the "portion claiming" reason for obtaining design patents on parts and are

attempting to use vehicle part design patents to control the market and price for

individual automotive repair parts. That is, even though a purchaser pays for the

vehicle and its overall patented design (that naturally includes patented designs on

all constituent parts) when the vehicle is initially purchased, vehicle manufacturers

are attempting to use separate design patents on repair parts to obtain a double

recovery and to control the market by eliminating competition on repair parts. It

should be noted that two of the seminal cases on portion claiming in design patent

law permitted portion claiming of an integrated design (a drill bit) In re Zahn, 617

F.2d 261 (Fed. Cir. 1980) and (silverware handle) Gorham v. White, 81 U.S. 511

(1871). These cases did not involve the type of claiming at issue here where

design patents are being asserted over separate parts needed for repair.

When companies attempt to control the market for repair/replacement parts

through design patents, the reaction of the courts, including this Court, has been

negative. Two case examples are Best Lock and Static Control, discussed

32
previously. The district court in Best Lock and both courts in Static Control found

the designs not to be a matter of concern for several reasons. In Static Control, the

Sixth Circuit primarily focused on the period of time that a replacement cartridge

was being purchased: “Lexmark itself explained that the advertisements containing

photographs were primarily to assist the customer in selecting the cartridge that

was compatible with the printer they owned” and “[t]he cartridges' appearance had

no other role in the purchaser's decision of which cartridge to purchase.”3 697 F.3d

at 422. In Best Lock, the district court focused both on when the key blade and

keyway were originally purchased and when replacement key blades were being

purchased. “Ornamentation, or the aesthetic quality of this design, is not a matter

of concern during either the use of the product or at the time the key or lock is

purchased. . . . There is no evidence that at any time in the commercial process the

appearance of the cross-section of the key or keyway represented a matter of

ornamental concern to the purchaser or the user.” 896 F. Supp. at 843.

In the instant case, ABPA argues that the subject designs are not a matter of

concern because (1) during initial F-150 purchase the customer concern is on the

overall vehicle appearance (not the hood and headlamp in isolation), the hood and

headlamp designs allegedly are part of the overall F-150 combination, and the only

3
Note that design patents are functional either when the design is “dictated by
function,” or when the design is not a “matter of concern.” The “dictated by
function” principle focuses on the function of the design itself whereas the “matter
of concern” principle focuses on the concerns of the purchaser and user.

33
concern for the hood and headlamp designs is that they are aesthetically

compatible with the F-150’s overall appearance, and (2) during a

repair/replacement part purchase, the only customer concern is that the hood or

headlamp appearance match the original parts, which can be purchased by part

number.

The District Court believed that In re Webb, 916 F.2d 1553 (Fed. Cir. 1990)

foreclosed ABPA’s matter-of-concern argument. In re Webb involved the

patentability of an artificial femur design. The Board of Patent Appeals and

Interferences (Board) held the design was not patentable because it was hidden

from sight while in normal use. This Court believed the Board’s ruling improperly

created a per se rule that if an article is hidden in final use, it is not ornamental.

This Court stated the correct inquiry is whether an article “is always concealed in

its normal and intended use,” 916 F.2d at 1557 (citing and quoting In re Stevens,

173 F.2d 1015, 1016 (CCPA 1949), including the time it is displayed for sale

where design features can be noticed by potential purchasers. Evidence in the case

indicated the devices were displayed in advertisements and trade shows, but the

Board disregarded the evidence due to its per se rule. This Court reversed and

remanded so the evidence could be considered.

Two important points should be considered. First, In re Webb does not

involve mate and match principles or articles that can be sold as repair/replacement

34
items such as key blades, printer cartridges, hoods, or headlamps. However, with

regard to such replacement items, In re Webb states “many replacement items,

including vacuum cleaner brushes, are sold by replacement or order number, or

they are noticed during sale only to assess functionality. In such circumstances, the

PTO may properly conclude that an application provides no evidence that there is a

period in the commercial life of a particular design when its ornamentality may be

a matter of concern.” Id. at 1558.

Second, if the rule set forth in In re Webb is strictly applied to the fact

patterns in Best Lock and Static Control, the outcomes may not have been the

same. An In re Webb type argument could be made that in Best Lock an

advertisement displaying the unusual key blade design profile might be better

noticed by a prospective purchaser, and in Static Control a printer cartridge

displaying a sleek or elegant profile might also be better noticed by a prospective

purchaser. Note that the “matter of concern” determinations in Best Lock and

Static Control were not made by this Court, and In re Webb sets a low bar for

ornamentality in cases not involving repair/replacement parts. This Court did not

address the “matter of concern” issue in Best Lock because it based its ruling solely

on dictated by function.

Regarding the Sixth Circuit’s opinion in Static Control, a reasonable way to

understand the “matter of concern” rationale is to realize that the court did not

35
strictly apply the In re Webb rule for the initial purchase, but rather emphasized the

compatibility between the printer and cartridge and the post-sale replacement

nature of the printer cartridge. In short, the rule from In re Webb is more

appropriate when compatibility between a parent article and a component article is

not at issue, as it was not at issue in that case.

I. Alternatively, the Subject Claimed Designs can be Considered


Ornamental and Valid in the Initial Sales Market, but Functional and
Unenforceable in the Repair/Replacement Market

Another way to understand the reasoning and outcomes in Best Lock and

Static Control is to realize that the courts are dealing with two different markets for

goods. One is the initial market for sale of the F-150, and the second is the market

for the replacement components. Although the cases do not expressly recognize

the two markets, they do exist. The cases emphasize that the product designs are

functional and invalid in the repair/replacement market because design is not a

matter of concern, and thereby also foreclose use of the design patents to protect

the designs in the original market. This, in effect, emphasizes a rationale to not let

design patents control a market for replacement parts. This same rationale is

applicable to the instant case.

Although Static Control and the district court decision in Best Lock

invalidated the design patent based on functionality, there is a potential middle

ground that would allow the design patent to remain valid for portion claiming, but

36
not enforceable for the repair/replacement market. The principle is that the

functionality of design patents should be evaluated in the context of the particular

market they are being used in. This concept exists in trademark law and is being

used by FGTL’s exclusive patent licensee, LKQ Corporation (LKQ), in a lawsuit

brought by LKQ against the United States Department of Homeland Security

(DHS) (LKQ Corporation, et al. v. DHS, Case No. 1:18-cv-00225, D.C. Del.,

February 7, 2018). (Appx3608). In the lawsuit, LKQ argues that it is not

attempting to invalidate the trademarks as functional, but “is arguing that in the

unique circumstances of this particular market (i.e., the aftermarket repair parts

market), the Automakers’ Recorded Trademarks cannot be enforced because the

marks are functional in this context.” (Appx3624) In support, LKQ cites Chrysler

Corp v. Vanzant, 44 F.Supp.2d 1062, 1070-71 (C.D. Cal. 1999) (“functionality

must be assessed within the context in which the product design is used” because

“a product design or feature may be non-functional in one context while its

use in another context is functional and non-infringing.”) (emphasis added by

LKQ). (Appx3624-3625).

Focusing on the particular market served is appropriate in trademark law

because the emphasis is on customer confusion. As an alternative argument,

focusing on the particular market served also is appropriate in design patent law

because the matter of concern inquiry relates to the concerns of the purchaser.

37
In the event this Court finds it necessary to address the matter of concern

issue and assuming arguendo this Court rejects ABPA’s argument over “matter of

concern” during the initial purchase, this Court can find the subject design patents

not invalid regarding the initial sale, but unenforceable because they are functional

in the repair/replacement market. This approach is reasonable because it exists in

trademark law and design patent functionality is a flexible concept that has been

used in ways other than to invalidate a design patent. For example, during claim

construction, design elements considered functional are factored out of the

infringement analysis. See Richardson v. Stanley Works, Inc., 597 F. 3d 1288,

1293-94 (Fed. Cir. 2010) (construing a design patent by factoring out functional

elements in the context of a bench trial). Further, such an approach would achieve

the results and objectives of Best Lock and Static Control by rendering the design

patents unenforceable in the repair/replacement market context, but would preserve

the validity of the design patents for portion claiming purposes, previously

mentioned.

J. Patent Invalidity due to Functionality is an Issue of Law

Case law currently considers functionality in the invalidity context to be an

issue of fact and functionality in the claim construction context to be an issue of

law. See, e.g., Torspo Hockey Intern., Inc. v. Kor Hockey Ltd., 491 F. Supp.2d

871, n. 4 (D. Minn. 2007). However, the case cited for functionality in the

38
invalidity context, Hupp v. Siroflex of Am., Inc., 122 F.3d 1456, 1461 (Fed. Cir.

1997) is cited because a finding of invalidity based on functionality was reviewed

for substantial evidence. The district court final judgment in Hupp was entered on

February 8, 1995, which is before Markman v. Westview Instruments, Inc., 52 F.3d

967 (Fed. Cir. 1995) was decided on April 5, 1995. Markman made claim

construction an issue of law. Since the functionality analysis for invalidity and

claim construction are substantively the same, it does not make sense that one is

treated as an issue of fact and the other as an issue of law. To avoid potential

inconsistencies, invalidity functionality now should be considered as issue of law.

II. THE SUBJECT PATENTS ARE UNENFORCEABLE DUE TO PATENT


EXHAUSTION, IMPLIED LICENSE, AND THE RIGHT TO REPAIR

A. Introduction

ABPA’s argument for why the subject design patents are exhausted will

begin with a discussion of general legal principles. The argument then will explain

why patent exhaustion exists in this case and why the District Court’s patent

exhaustion analysis and holding are incorrect. The argument then will explain why

implied principles support a finding of patent exhaustion. The argument will

conclude with a statement that the “have made” rights of F-150 purchasers protect

the manufacturer of repair parts and others in the distribution chain.

B. Patent Exhaustion and Implied License Legal Principles

39
Under the patent exhaustion doctrine, the unrestricted sale of a patented

article (or an article embodying or sufficiently embodying a patent), “by or with

the authority of the patentee, ‘exhausts’ the patentee's right to control further sale

and use of that article by enforcing the patent under which it was first sold." Jazz

Photo Corp. v. Int'l Trade Comm., 264 F.3d 1094, 1105 (Fed. Cir. 2001); see also

Lexmark Int'l, Inc. v. Impression Prods., Inc., 816 F.3d 721 (Fed. Cir., 2016)

(stating “[t]he doctrine of patent exhaustion (or ‘first sale’ doctrine) addresses the

circumstances in which a sale of a patented article (or an article sufficiently

embodying a patent), when the sale is made or authorized by the patentee, confers

on the buyer the ‘authority’ to engage in acts involving the article, such as resale,

that are infringing acts in the absence of such authority.”). Id. at 726.

Patent exhaustion is grounded on “the theory that an unconditional sale of a

patented device exhausts the patentee's right to control the purchaser's use of that

item thereafter because the patentee has bargained for and received full value for

the goods.” Keurig, Inc. v. Sturm Foods, Inc., 732 F.3d 1370, 1373 (Fed. Cir.

2013). It can be invoked as an affirmative defense to an infringement claim, "and

like other issues in which there are no disputed factual questions, may be properly

decided by summary judgment." Id. at 1373. The patent exhaustion doctrine

applies to design patents. See Jazz Photo, 264 F.3d at 1110 (Fed. Cir. 2001).

40
The “authorized sale of a patented product places that product beyond the

reach of the patent," Intel Corp. v. ULSI Sys. Technology, Inc., 995 F.2d 1566,

1568 (Fed. Cir. 1993), and creates an “implied license,” under which “a patent

holder receives a reward for inventive work in the first sale of the patented

product.” McCoy v. Mitsuboshi Cutlery, Inc., 67 F.3d 917, 921 (Fed. Cir 1995).

The “implied license to use include[s] the right to repair the patented article and

necessarily to purchase repair parts from others.” Kendall Co. v. Progressive

Medical Technology, Inc., 85 F.3d 1570, 1573 (Fed. Cir. 1996). The implied

license covers both the original purchaser of the article and all subsequent

purchasers. Hewlett-Packard Co. v. Repeat-O-Type Stencil Mfg. Corp., 123 F.3d

1445, 1451 (Fed. Cir. 1997). “The right to repair is implied as a matter of law.”

85 F.3d at 1573. The right to repair is a question of law. See Bottom Line

Management, Inc. v. Pan Man, Inc., 228 F.3d 1352, 1355 (Fed. Cir. 2000).

“The distinction between permitted and prohibited activities, with respect to

patented items after they have been placed in commerce by the patentee, has been

distilled into the terms ‘repair’ and ‘reconstruction.’” Jazz Photo, 264 F.3d at

1102. "[T]here is no bright-line test for determining whether reconstruction or

repair has occurred." Sandvik Aktiebolag v. E.J. Co., 121 F.3d 669, 674 (Fed. Cir.

1997). The ultimate determination is based upon "the totality of the

circumstances." Id. at 673. Prohibited reconstruction must be "true reconstruction

41
of the entity as to `in fact make a new article' . . . a second creation of the patented

entity." Aro Mfg. Co. v. Convertible Top Replacement Co., 365 U.S. 336, 346,

(1961).

Patent exhaustion and the right to repair apply to so-called "have-made"

rights: "[B]y exercising their rights to 'have [licensed products] made,' licensees

can shield the unlicensed manufacturer who makes the products for them and

subsequently sells the products to them from infringement liability by impliedly

licensing the otherwise infringing actions." Intel Corp. v. Broadcom Corp., 173 F.

Supp. 2d 201, 232 (D. Del. 2001). This is because "[t]he right to 'make, use, and

sell' a product inherently includes the right to have it made by a third party, absent

a clear indication of intent to the contrary." CoreBrace LLC v. Star Seismic LLC,

566 F.3d 1069, 1072-73 (Fed. Cir. 2009).

If the thing sold “substantially embodies” patented subject matter owned by

the entity that authorized the sale, then the patent is exhausted as to the thing sold.

Quanta Computer Inc. v. LG Electronics, Inc., 553 U.S. 617, 638 (2008).

“Substantial embodiment” in the method patent context is established if (1) the

only reasonable and intended use of the article is to practice the allegedly

exhausted patent; and (2) the article embodies the essential or inventive features of

the allegedly exhausted patent. See id. at 631; LifeScan Scotland, Ltd. v. Shasta

Techs., LLC, 734 F.3d 1361, 1368–70 (Fed. Cir. 2013).

42
C. Patent Exhaustion Exists in This Case

The F-150 is an article of manufacture sold in the United States.

(Appx1060, Appx1062-1064). FGTL has alleged that the subject patented designs

are both applied to and are embodied in the F-150 (Appx991), and FGTL has made

a claim of patent infringement.4 (Appx991). Therefore, the subject patented

designs are exhausted by the first sale of the F-150. See Jazz Photo, supra, 264

F.3d at 1105; Quanta Computer, supra, at 638. (“If the thing that is sold

‘substantially embodies’ patented subject matter owned by the entity that

authorized the sale, then the patent is exhausted as to the thing sold.”).

Further, although the subject patented designs also are alleged to be portions

of components parts of the F-150 (the hood and headlamp), the Supreme Court has

stated that “[t]he term ‘article of manufacture,’ as used in § 289, encompasses both

a product sold to a consumer and a component of that product.” Samsung Elecs.

Co. v. Apple Inc., 137 S.Ct. 429, 434, 196 L.Ed.2d 363 (2016). The Supreme

Court also stated “[t]his reading of article of manufacture in § 289 is consistent

with 35 U.S.C. § 171(a), which makes ‘new, original and ornamental design[s] for

an article of manufacture’ eligible for design patent protection.” Id. at 435.

The F-150 sometimes is involved in collisions and needs repair. The process

of repair often involves purchasing repair parts from third parties, such as ABPA

4
“Patent exhaustion is an affirmative defense to a claim of patent infringement….”
Keurig, Inc. v. Sturm Foods, Inc., 732 F.3d 1370, 1373 (Fed. Cir. 2013).

43
members. Since the subject design patents are exhausted as to the thing sold, and

the thing sold is the F-150, purchasers of the F-150 have an implied license to use

the subject design patents. See McCoy, supra, at 921. This implied license

includes the right to repair and return the F-150 back to its original appearance.

See Kendall Co., supra, at 1573. If the repair and return to the original appearance

requires the purchase of repair parts, then this is permitted under the implied

license. Id. That is because the focus is not on the repair parts themselves, but

rather on the article of manufacture that needs repair. See Kendall Co., supra, at

1573. (The “implied license to use include[s] the right to repair the patented article

and necessarily to purchase repair parts from others.”).

The repair that occurs to the F-150 is not prohibited reconstruction because

the repair of the F-150 does not “construct an essentially new article on the

template of the original.” Jazz Photo, 264 F.3d at 1102. (Appx1201). Indeed, if

the damage to the F-150 is so extensive that essentially a new F-150 has to be

constructed, the F-150 will not be repaired. (Appx1201). That is because the cost

of the reconstruction will greatly exceed the cost of purchasing a new F-150.

(Appx1201).

Since the owner of the F-150 has an implied license to repair the F-150, the

owner also has “have made” rights that shields the manufacture of the repair part

and all members of the distribution chain from liability for patent infringement.

44
See CoreBrace LLC, supra, at 1072-73; Intel Corp., supra, at 232 ("[B]y

exercising their rights to 'have [licensed products] made,' licensees can shield the

unlicensed manufacturer who makes the products for them and subsequently sells

the products to them from infringement liability by impliedly licensing the

otherwise infringing actions.").

D. The District Court’s Analysis is Incorrect that the Subject Patents


were not Exhausted

To understand why the District Court’s order is incorrect, it is helpful to

methodically analyze the court’s rationale. The District Court begins its discussion

by reviewing general principles of patent exhaustion. One important principle not

mentioned by the District Court is that an initial authorized sale creates an “implied

license,” under which “a patent holder receives a reward for inventive work in the

first sale of the patented product.” McCoy v. Mitsuboshi Cutlery, Inc., 67 F.3d 917,

921 (Fed. Cir 1995). And it is under the concept of an implied license that the

“implied license to use include[s] the right to repair the patented article and

necessarily to purchase repair parts from others.” Kendall Co. v. Progressive

Medical Technology, Inc., 85 F.3d 1570, 1573 (Fed. Cir. 1996).

The District Court then discusses an important limitation to the right to

repair, which is that it does not include the right to replace. In the words of the

District Court, “[t]he authorized sale of a patented item permits the owner to sell

and use the one item that he purchased—not to make a replacement should that one

45
item be destroyed.” (citing Bowman v. Monsanto Co., 569 U.S. 278, 283–84

(2013)). “In other words, ‘the [exhaustion] doctrine restricts a patentee’s rights

only as to the ‘particular article’ sold; it leaves untouched the patentee’s ability to

prevent a buyer from making new copies of the patented item.’ Id. at 284 (internal

citations omitted).” (Appx113). Notably, the case cited for the concept of a

“particular article” sold, Bowman v. Monsanto Co., supra, involves utility patents

on genetically modified seeds and not a design patent.

The District Court then illustrates the repair vs. replace limitation with

another utility patent case, Aiken v. Manchester Print Works, 1 F. Cas. 245

(C.C.D.N.H. 1865). (Appx114). In Aiken, the patentee sold a knitting machine

with a full set of needles and a surplus number of needles. The knitting machine

was the subject of various patents not specified in the case, and the needles were

subject to United States Patent No. 6,025. The needles wore out after a period of

time and had to be replaced. When the purchaser of the knitting machine ran out

of needles, he began making his own needles and was sued by the patentee for

patent infringement.

The purchaser argued that the purchase of the machine implied the right to

use it, and when the needles wore out and the machine could not be used, the

purchaser had the right, despite the separate patent on the needles, to make new

needles “as the necessary means to enable [the purchaser] to enjoy the right of use

46
implied by the purchase.” Id. at p.3. The court disagreed, stating that

“[p]urchasers in this case may repair the needles they purchased, but they cannot

manufacture new ones, without license.” Id. at p.4.

The general rule from Aiken is that in a situation involving utility patents, a

patented machine may not be permissibly repaired under the patent exhaustion

doctrine by replacing a component of the machine when the component being

replaced is patented separately from the machine being repaired. The District

Court expresses this general rule with the statement “[i]n reaching its conclusion

that the machine could not be repaired by replacing worn out needles with new

ones, the court explicitly distinguished the first example provided above, i.e.,

where a patent covered the knitting machine but no patent covered just the needles.

See [Aiken] (distinguishing Wilson v. Simpson, 50 U.S. 109 (1850)).” (Appx114).

The District Court then states “[t]he Supreme Court long ago approved of

the reasoning of Aiken, see Morgan Envelope Co. v. Albany Perforated Wrapping

Paper Co., 152 U.S. 425, 434–36 (1894), and the Federal Circuit says that the

venerable case is still the law, see Helferich Patent Licensing, LLC v. N.Y. Times

Co., 778 F.3d 1293, 1304 (Fed. Cir. 2015). (Appx114). Notably, Aiken, Wilson,

Morgan Envelope, and Helferich all involve utility patents and not design patents.

The District Court then sets forth a general statement of ABPA’s argument

on patent exhaustion and concludes “[t]he problem with the ABPA’s argument is

47
that the F-150 is just like the knitting machine in Aiken and its hood (or headlamp)

is just like the needles in Aiken.” (Appx114-115). The District Court continues:

“The patents at issue cover the design for those two parts—not the design for the

truck as a whole—so while the authorized sale of an F-150 permits the owner to

use and repair her hood and headlamp, it does not permit her to make unauthorized

replacements or have replacements made for her.” (Appx115).

As will be explained below, since this case involves a design patent and not

utility patents, it is incorrect to say that the F-150 is just like the knitting machine

in Aiken, and the F-150’s hood (or headlamp) is just like the needles in Aiken.

Further, it also is incorrect to say that the patents at issue “cover the design for

those two parts [the hood and headlamp].” Rather, the designs at issue cover

portions of the hood and headlamp, just as they cover portions of the F-150.

The District Court sets out in a general way ABPA’s argument regarding the

distinction between design patents and utility patents in the context of patent

exhaustion and states “[t]here is no case dividing patent law this way—i.e.,

creating separate exhaustion doctrines for utility and design patents.” (Appx115).

The District Court then continues “[i]ndeed, in Aiken, the needles were not only

their own item but also a necessary part of another: the knitting machine. And so

while the needle patent could be viewed as covering one entire item (a needle), it

could also be viewed as covering a portion of an item that incorporates the other

48
(the knitting machine).” (Appx115-116). Explaining why this last statement is

incorrect is a helpful way to begin explaining the error of the District Court and the

correctness of ABPA’s patent exhaustion argument.

As a preliminary matter, and contrary to a statement in the District Court’s

opinion, ABPA is not arguing that a separate exhaustion doctrine should be created

for design patents. Rather, ABPA is arguing that established patent exhaustion

principles should be applied to design patents in a way that recognizes the unique

nature of design patents and how the design patent statutory scheme differs from

the utility patent statutory scheme. This is the way that courts historically have

approached patent exhaustion – recognizing that the doctrine must remain flexible

and adapting it to new fact patterns and different type of patents.

For example, in Quanta Computer Inc. v. LG Electronics, Inc., 553 U.S.

617, 128 S.Ct. 2109 (2008), a case involving microprocessors and chipsets, the

Supreme Court addressed the issue of whether patent exhaustion applied to method

patents. Respondent LGE argued that “because method patents are linked not to a

tangible article but to a process, they can never be exhausted through a sale.” Id. at

S.Ct. 2117. The Supreme Court disagreed, stating “[i]t is true that a patented

method may not be sold in the same way as an article or device, but methods

nonetheless may be ‘embodied’ in a product, the sale of which exhausts patent

rights.” Id. In finding that patent exhaustion applied, the Supreme Court followed

49
its earlier approach in United States v. Univis Lens Co., 316 U. S. 241 (1942) and

stated “[t]he authorized sale of an article that substantially embodies a patent

exhausts the patent holder's rights and prevents the patent holder from invoking

patent law to control postsale use of the article” and “Intel's microprocessors and

chipsets substantially embodied the LGE Patents because they had no reasonable

noninfringing use and included all the inventive aspects of the patented methods.”

Id. at 2122.

Finally, in response to LGE’s argument that “exhaustion does not apply

across patents,” id. at 2120, the Supreme Court agreed on the general principle that

“[t]he sale of a device that practices patent A does not, by virtue of practicing

patent A, exhaust patent B.” Id. But, the Supreme Court continued, “if the device

practices patent A while substantially embodying patent B, its relationship to

patent A does not prevent exhaustion of patent B.” Id. The Court concluded “the

exhaustion analysis is not altered by the fact that more than one patent is practiced

by the same product. The relevant consideration is whether the Intel Products that

partially practice a patent—by, for example, embodying its essential features—

exhaust that patent.” Id. at 2121.

In the instant case the factual situation is different, but the reasoning is the

same. In Quanta Computer, each Intel microprocessor and chipset practiced

“thousands of individual patents.” Id. In the instant case, two articles (the F-150

50
and the hood or headlamp) embody the subject design patents. However, the key

to exhaustion is not how many patents are embodied in a product or how many

products embody a patent, but whether the article sold embodies the patent. If so,

the patent is exhausted. In the instant case, since the F-150 embodies the subject

patents, patent exhaustion applies as to the F-150 and a right to repair the F-150

exists.

Returning to the District Court’s Aiken knitting machine and needles

comparison, the District Court states “[a]nd so while the needle patent could be

viewed as covering one entire item (a needle), it could also be viewed as covering

a portion of an item that incorporates the other (the knitting machine).” (emphasis

in original) (Appx115-116). The problem with this statement is that while the

knitting machine physically incorporates the needle, the patent covering the needle

cannot be viewed as covering a portion of the knitting machine. Unlike in the

design patent context where the subject design patents properly can be viewed as

being embodied in both the hood (and headlamp) and a portion of the F-150, utility

patents are directed only toward the actual machine or article of manufacture

invented, and not also toward a portion of a machine or article of manufacture that

may incorporate the subject matter claimed. An examination of the relevant patent

statutes reveals why this is so.

51
The utility patent statute, 35 U.S.C. § 101, states “[w]hoever invents or

discovers any new and useful process, machine, manufacture, or composition of

matter, or any new and useful improvement thereof, may obtain a patent therefor,

subject to the conditions and requirements of this title.” In contrast, the design

patent statute, 35 U.S.C. § 171(a), states “[w]hoever invents any new, original and

ornamental design for an article of manufacture may obtain a patent therefor,

subject to the conditions and requirements of this title.”

The word “therefor” in the utility patent statute refers to, inter alia, the

words “machine” and “manufacture,” whereas in the design patent statute the word

“therefor” refers not to “article of manufacture,” but rather to “design.” See In re

Zahn, 617 F.2d 261, 268 (C.C.P.A. 1980). This distinction means that, unlike

utility patents, design patents are not limited to an “article of manufacture,” but

also can include designs for portions of articles of manufacture. Id. Further, since

the patented design can be just a portion of an article of manufacture, the design

patent need not be limited to just one article of manufacture. Rather, the design

claimed can be embodied in both a portion of article of manufacture and also a

portion of a component of an article of manufacture. The instant case provides an

example. The design claimed in the ‘299 Patent is embodied both in a portion of

the F-150 and in a portion of the component F-150 hood. Likewise, the design

52
claimed in the ‘685 Patent is embodied both in a portion of the F-150 and in a

portion of the component F-150 headlamp.

The conclusion that a claimed design can be embodied in both an article of

manufacture and in a component of an article of manufacture is supported by the

Supreme Court’s statement in Samsung Electronics, supra, that “[t]he term ‘article

of manufacture,’ as used in § 289, encompasses both a product sold to a consumer

and a component of that product.” Id. at 434. The Supreme Court also stated

“[t]his reading of article of manufacture in § 289 is consistent with 35 U.S.C. §

171(a), which makes ‘new, original and ornamental design[s] for an article of

manufacture’ eligible for design patent protection.” Id. at 435.

The importance of the distinction between utility patents and design patents

explained above is that the general rule from Aiken does not apply to the subject

design patents. Under the general rule cited, the patent covering the separate

component article of manufacture being replaced (needle) is different from the

patent directed toward the article of manufacture being repaired (knitting machine).

As explained above, under § 101, a utility patent is directed toward the actual

machine or article of manufacture invented. Although a sale of the machine and

needle together exhausts both patents, the patent exhaustion doctrine only permits

repair and not replacement. Since the patents and articles of manufacture are

different, they must be analyzed separately to determine whether repair or

53
replacement is occurring for each. Permissible repair of the machine does not

necessarily mean permissible repair of the needle. If permissible repair of the

needles is not occurring, and the needles are being replaced instead as in Aiken,

then patent infringement of the needle patent may exist and the affirmative defense

of patent exhaustion is not available.

However, the situation is different with a design patent under the

circumstances of the instant case. First, there are not multiple patents involved as

in Aiken. Rather, for the F-150 and hood, and F-150 and headlamp, there is just

one design patent each to consider. Second, when the one subject patented design

is placed on or in the F-150, the one design patent is exhausted. And as long as it

is the F-150 that is being permissible repaired, then the patent exhaustion doctrine

allows use of the subject patented design (originally a part of the F-150 that was

sold) to repair the F-150 that was sold with the patented design. This is to be

distinguished from the situation in Aiken where the court had to go through a

separate repair/ reconstruction analysis with regard to the needle itself because the

needle was covered by a separate patent directed only toward the needle. There is

no need to perform a separate repair/reconstruction analysis on the repair parts in

the instant case because the patented design covering a portion of the repair parts is

the same as the patented design covering a portion of the F-150 being permissibly

repaired under the patent exhaustion doctrine.

54
E. Authorized Sale of the F-150 Created an Implied License that
included the Right to Repair the F-150 and Purchase Repair Parts

Although not mentioned by the District Court, it is an implied license that

underlies the right to repair and the right to purchase repair parts. Kendall Co.,

supra, 85 F.3d at 1573. The principle is that when an article of manufacture is

sold, the patentee grants an implied license to the purchaser to repair it. And as

long as there is a legal relationship, such as embodiment, between the patent and

the article of manufacture sold, the implied license grants a right to repair the

article of manufacture sold. Quanta Computer, supra,128 S.Ct. at 2121. In the

instant case, there is such a legal relationship between the F-150 sold and the

subject design patents because the claimed designs are embodied in the F-150 and

design patent law allows for portion claiming.

In contrast, in Aiken an implied license does not exist to allow a purchaser

the right to repair the knitting machine by replacing the needles. That is because

there is no legal relationship between the needle patent and the knitting machine.

Although there is a physical relationship between the needles and the knitting

machine, there is no legal relationship between the needle patent and knitting

machine because utility patents are directed toward an article of manufacture,

which in Aiken is the needles and not the knitting machine.

Other implied licensing principles also support the conclusion that the scope

of the implied license in this case includes the right to repair the F-150 by

55
purchasing the hood and headlamp as repair/replacement parts. Once a court

determines that a license should be implied due to an initial authorized sale, the

court next should look to the circumstances of the sale to determine the scope of

the implied license. See Carborundum Co. v. Molten Metal Equip. Innovs., 72 F.3d

872, 878 (Fed. Cir. 1995). In this case, since the claimed designs were embodied

in the F-150 and in the hood and headlamp, it is clear that an implied license to

repair exists. And the circumstances of the sale further support the conclusion that

the scope of the implied license includes the right to repair the F-150 by

purchasing the hood and headlamp as repair/replacement parts.

There is no evidence in this case that when Ford sells an F-150, FGTL

places any restrictions on the implied licenses granted as a result of the sale. See

Met-Coil Systems Corp. v. Korners Unlimited, Inc., 803 F.2d 684, 686, 687 (Fed.

Cir. 1986). Further, there is no evidence that Ford and FGTL mark the F-150 or

any of its component parts with design patents. Therefore, when a customer

purchases an F-150, they have no notice, actual or constructive, that the hood and

the headlamp are separately patented. Further, the F-150 is advertised and sold as

a complete article of manufacture with an overall design rather than as a collection

of individual parts with individual designs. Finally, to the extent a customer may

be aware of the subject design patents, the subject patents state the hood and

headlamp are “intended for attachment to a vehicle.” (Appx174, Appx183).

56
Based on this evidence, the reasonable expectation is that a purchaser of the

F-150 receives an implied license to repair the F-150 free from any patents

covering portions of the designs. See Carborundum, supra, at 878 (The scope of an

implied license “must be based on what the parties reasonably intended as to the

scope of the implied license based on the circumstances of the sale.”). Based on

this reasonable expectation, and FGTL’s lack of action or notice to dissuade this

reasonable expectation, the scope of the implied license extends to repairing the F-

150 with the hood and headlamp repair/replacement parts.

FGTL may argue that even if an implied license exists on the subject patents

to repair the F-150, an independent cause of action for patent infringement still

may exist because the subject patents also are embodied in a portion of the hood

and headlamp, and the hood and headlamp are being purchased for the repair of the

F-150. This would be, in effect, an attempt to apply the Aiken rule even though the

subject claimed designs are embodied in the F-150 sold. To the extent a hood or

headlamp is being purchased for reasons other than for repair of an F-150

originally sold by Ford, then an implied license would not exist. However, if the

parts are being purchased for repair of an F-150, then an implied license will exist

regarding the subject patents that, in turn, should negate any cause of action for

purchasing the hood and headlamp as repair/replacement parts. Indeed, if the

subject design patents could be enforced on the repair parts, then that would

57
effectively negate the right to repair the F-150. This would allow a patentee to do

an “end-run” around the patent exhaustion doctrine by dividing an article of

manufacture into separate portions and then claiming the design portions for

individual enforcement. This Court did not allow such an approach in the method

patent context, see Quanta Computer Inc., supra, at 2117, 2118 and it similarly

should not allow such an approach in the design patent context.

F. The “Have Made” Rights of F-150 Truck Purchasers Protect the


Manufacturer of Repair Parts and Others in the Distribution Chain

Since the implied license covers the right to repair the vehicle, the “have

made” rights of the vehicle purchaser protects the manufacturers and distributors,

including ABPA members, from liability for patent infringement. See CoreBrace

LLC, supra, at 1072-73; Intel Corp., supra, at 232.

CONCLUSION AND RELIEF SOUGHT

Based on the arguments and authorities set forth above, the District Court

erred in denying ABPA’s motion for summary judgment and granting summary

judgment in favor of FGTL. ABPA requests that this case be reversed and

summary judgment rendered in favor of ABPA, and that this Court grant such

other and further relief to which ABPA may show itself to be justly entitled.

April 27, 2018

******

58
Respectfully submitted,

/s/ Robert G. Oake, Jr.


Robert G. Oake, Jr.
Texas Bar No. 15154300
Oake Law Office
700 S. Central Expy., Suite 400
Allen, Texas 75013
Telephone: 214.207.9066
rgo@oake.com

Paul M. Kittinger (P72754)


CARDELLI LANFEAR, P.C.
322 W. Lincoln
Royal Oak, MI 48067
(248) 544-1100
pkittinger@cardellilaw.com

Attorneys for ABPA

59
CERTIFICATE OF COMPLIANCE

1. This brief complies with the type-volume limitation of Federal Rules of

Appellate Procedure 32(a)(7)(B). This brief contains 13,906 words,

excluding the parts of the brief exempted by the Federal Rules of Appellate

Procedure 32(a)(7)(B)(iii).

2. This brief complies with the typeface requirements of Federal Rules of

Appellate Procedure 32(a)(5) and the type style requirements of Federal

Rules of Appellate Procedure 32(a)(6). This brief has been prepared in a

proportionally spaced typeface using Microsoft Word in 14 point Times

New Roman font.

/s/ Robert G. Oake, Jr.


Robert G. Oake, Jr.
Attorney for Plaintiffs-Appellants
April 27, 2018

60
ADDENDUM

1. Judgment Appealed ………………………………… Appx91-92

2. Opinion and Order Appealed ………………………… Appx93-117

61
2:15-cv-10137-LJM-RSW Doc # 74 Filed 02/23/18 Pg 1 of 2 Pg ID 1997

UNITED STATES DISTRICT COURT


EASTERN DISTRICT OF MICHIGAN
SOUTHERN DIVISION

AUTOMOTIVE BODY PARTS


ASSOCIATION,

Plaintiff,
Case No. 2:15-cv-10137
v. Honorable Laurie J. Michelson

FORD GLOBAL TECHNOLOGIES, LLC,

Defendant.

JUDGMENT

Consistent with the opinion and order entered on February 20, 2018 (R. 72) and the

Automotive Body Parts Association’s subsequent notice (R. 73) it is HEREBY ORDERED and

ADJUDGED that Ford Global Technologies, LLC is entitled to judgment on the ABPA’s

complaint seeking a declaration that U.S. Patent Nos. D489,299 and D501,685 are invalid or

unenforceable. In entering this judgment, the Court notes that, as reflected by the citations in its

February 20, 2018 opinion, it did consider and address New World International’s response brief

filed in Case No. 15-10394 (R. 104) and associated appendix (R. 105) in issuing the February 20

opinion. Those filings from that case are thus deemed part of the record in this case.

SO ORDERED.

s/Laurie J. Michelson
LAURIE J. MICHELSON
Dated: February 23, 2018 U.S. DISTRICT JUDGE

Appx0091
2:15-cv-10137-LJM-RSW Doc # 74 Filed 02/23/18 Pg 2 of 2 Pg ID 1998

CERTIFICATE OF SERVICE

The undersigned certifies that the foregoing document was served upon counsel of record
and any unrepresented parties via the Court=s ECF System to their respective email or First Class
U.S. mail addresses disclosed on the Notice of Electronic Filing on February 23, 2018.

s/Keisha Jackson
Case Manager

Appx0092
2:15-cv-10137-LJM-RSW Doc # 72 Filed 02/20/18 Pg 1 of 25 Pg ID 1703

UNITED STATES DISTRICT COURT


EASTERN DISTRICT OF MICHIGAN
SOUTHERN DIVISION

AUTOMOTIVE BODY PARTS


ASSOCIATION,

Plaintiff,
Case No. 2:15-cv-10137
v. Honorable Laurie J. Michelson

FORD GLOBAL TECHNOLOGIES, LLC,

Defendant.

OPINION AND ORDER


DENYING FORD’S MOTION TO DISMISS THE CASE AS MOOT [61] AND
DENYING THE ABPA’S MOTION FOR SUMMARY JUDGMENT [39]

The Automotive Body Parts Association effectively asks this Court to eliminate design

patents on auto-body parts. Members of the ABPA import, make, and sell auto-body parts that

are used to repair cars and trucks damaged in a collision. Ford Global Technologies, LLC holds a

large portfolio of patents that protect the designs for body parts for Ford vehicles. The ABPA, on

behalf of its members, filed this lawsuit asking this Court to declare that two of Ford’s patents

protecting the design of two F-150 body parts are either invalid or unenforceable. But the

ABPA’s arguments are not specific to those two patents. Instead, the ABPA argues that designs

for auto-body parts are simply not eligible for patent protection because consumers seeking to

repair their vehicles do not select body parts for their design and because the designs were

dictated by the body parts’ function. In the alternative, the ABPA says that patents protecting the

designs of auto-body parts are unenforceable against its members because the patent rights are

exhausted upon the first authorized sale of the vehicle.

Appx0093
2:15-cv-10137-LJM-RSW Doc # 72 Filed 02/20/18 Pg 2 of 25 Pg ID 1704

The ABPA now seeks summary judgment. (R. 39.) It asks this Court to declare as a

matter of law that two of Ford’s design patents are invalid or unenforceable. The Court has

carefully considered the parties’ arguments made not only in this case but in a related case

presenting the same invalidity and unenforceability questions. Having done so, the Court finds

that the ABPA has not shown that Ford’s designs for an F-150 hood and headlamp are not

eligible for design patent protection and has not shown that Ford’s patent rights to those designs

are exhausted when Ford sells an F-150 truck.

I.

Plaintiff Automotive Body Parts Association is an association of companies that

distribute automotive body parts. (See R. 2, PID 10–11.) Members of the ABPA sell auto-body

parts to collision repair shops or even directly to vehicle owners.

Defendant Ford Global Technologies, LLC owns a portfolio of well over a hundred

patents protecting the designs for auto-body parts. (See R. 62, PID 1253–1321.) Two are at issue

in this case: U.S. Patent No. D489,299 and U.S. Patent No. D501,685. The ’299 patent protects

the design for a Ford F-150 hood and the ’685 patent protects the design for an F-150 headlamp:

’299 patent, Fig. 1. ’685 patent, Fig. 2.

It appears that the first significant dispute between Ford and the ABPA arose in 2005.

That year, Ford filed an action with the United States International Trade Commission against

Appx0094
2:15-cv-10137-LJM-RSW Doc # 72 Filed 02/20/18 Pg 3 of 25 Pg ID 1705

seven members of the ABPA. (R. 68, PID 1453, 1585.) Ford initially accused these ABPA

members of infringing 14 of its design patents for auto-body parts, including the two at issue in

this case. (See R. 68, PID 1585.) Ford later dropped those two patents from the ITC action. The

ITC action (and a second one) settled in 2009, with Ford granting a single ABPA member, LKQ

Corporation, the exclusive right to sell auto-body parts protected by Ford’s design patents. (See

R. 62, PID 1329.)

As relevant to this case, things between Ford and the ABPA remained relatively quiet

until 2013, with Ford sending only two cease-and-desist letters to ABPA members in 2011 and

2012. (See R. 68, PID 1466, 1471.) But in 2013, the tension between Ford and ABPA member

New World International, Inc. escalated. (R. 62, PID 1250.) Ford wrote to New World, “We

purchased several articles from New World International that are covered by Ford design

patents[.]” (R. 62, PID 1260.) Ford referenced one of the design patents at issue in this case, the

’299 patent. (Id.) Ford asked New World to “refrain from importing or selling parts covered by

Ford design patents.” (R. 62, PID 1251.) New World did not comply (or at least that is what Ford

thought), so in November 2013, Ford sent New World another letter. The second letter warned

that if New World did not stop offering certain auto-body parts on its website, Ford “w[ould] be

forced to consider all avenues available to protect and enforce its intellectual property rights.”

(R. 61, PID 1245.)

Less than two weeks after Ford’s November 2013 letter, the ABPA filed this lawsuit in

the Eastern District of Texas. See Auto. Body Parts Assoc. v. Ford Global Techs., No. 13-00705

(E.D. Tex. filed Nov. 25, 2013.) The ABPA asked the federal court in Texas to declare six of

Ford’s design patents, including the ’299 and the ’685 patents, invalid or unenforceable.

Appx0095
2:15-cv-10137-LJM-RSW Doc # 72 Filed 02/20/18 Pg 4 of 25 Pg ID 1706

A few months later, Ford challenged the ABPA’s standing to seek such relief. One way

for an association to have standing to sue is for the association to satisfy the Hunt test: “(a) its

members would otherwise have standing to sue in their own right; (b) the interests it seeks to

protect are germane to the organization’s purpose; and (c) neither the claim asserted nor the

relief requested requires the participation of individual members in the lawsuit.” Hunt v. Wash.

State Apple Advertising Comm’n, 432 U.S. 333, 343 (1977). In September 2014, the federal court

in Texas found that the ABPA had satisfied this test. Auto. Body Parts Ass’n v. Ford Glob.

Techs., LLC, No. 4:13-CV-705, 2014 WL 4652123, at *8 (E.D. Tex. Sept. 17, 2014). As to the

first Hunt requirement, the court found that “in its cease and desist letters, Ford accused New

World of infringing the design patents, which is sufficient to establish that New World would

have standing in its own right to bring an action for declaratory judgment against Ford.” Id. at

*8.

Following that determination, the ABPA amended its complaint. Instead of seeking a

declaration that six of Ford’s design patents for auto-body parts were invalid or unenforceable, it

only sought that declaration as to the ’299 and ’685 patents. (See R. 2.)

In January 2015, the federal court in Texas transferred the case to the Eastern District of

Michigan and it was assigned to this Court’s docket. (See R. 1.)

Just two weeks later, Ford filed a separate lawsuit against New World in the Eastern

District of Michigan. Ford Global Techs., LLC v. New World Int’l, Inc. et al., No. 15-10394

(E.D. Mich. filed Jan. 29, 2015). Ford initially accused New World of infringing the two patents

at issue in this case along with several others. Like in the ITC action, Ford later dropped its

claims that New World had infringed the two patents at issue here. Ford’s case against New

World was reassigned to this Court’s docket as a companion to this case.

Appx0096
2:15-cv-10137-LJM-RSW Doc # 72 Filed 02/20/18 Pg 5 of 25 Pg ID 1707

In October 2016, the ABPA filed the motion for summary judgment now pending before

this Court. (R. 39.) According to the ABPA, the ’299 and ’685 patents are invalid because they

do not protect ornamental designs and they are unenforceable against ABPA members because

when Ford sells an F-150 truck, its patent rights in the design of the truck’s hood and headlamp

are exhausted. (See R. 39, PID 566.)

That same month, New World, which is represented by the same counsel as the ABPA,

filed for summary judgment in the companion to this case. New World essentially made the same

invalidity and unenforceability arguments as did the ABPA. Although New World subsequently

withdrew that motion, Ford then filed a mirror-image motion for summary-judgment: it claimed

that its design patents were not invalid for failing to protect ornamental designs and that they

were not unenforceable under the doctrine of exhaustion. Given that ABPA’s motion in this case

and Ford’s in the companion addressed the same two issues, the parties agreed that the Court

should consider the arguments presented in all the briefs in both cases in deciding both motions.

While this Court was in the midst of drafting its opinion on the two motions, a threshold

issue arose in each case. The first was a result of TC Heartland LLC v. Kraft Foods Group

Brands LLC, 137 S. Ct. 1514 (2017). There, the Supreme Court held that a corporation can be

sued for patent infringement only in its state of incorporation. See id. at 1517. New World’s was

Texas. So this question arose: should Ford’s suit against New World remain in the Eastern

District of Michigan?

The other threshold issue involved this case. Although it had made similar statements

earlier, in its summary-judgment briefing, Ford made clear that it was not accusing New World

of infringing the two patents at issue in this case. (See R. 54.) As noted above, under Hunt, the

Appx0097
2:15-cv-10137-LJM-RSW Doc # 72 Filed 02/20/18 Pg 6 of 25 Pg ID 1708

ABPA’s standing to seek a declaratory judgment was premised on New World’s standing to do

so. So the Court asked the parties to brief the issue of mootness. (See R. 54.) In that briefing,

Ford went a step further: it offered a covenant never to sue New World (and a few others) for

infringing the ’299 and ’685 patents. (See R. 61, PID 1104.) So this question arose: is this case

moot?

The Court has already answered one of the two threshold questions. In particular, the

Court found that under TC Heartland, the Eastern District of Michigan was not the proper venue

for Ford’s suit against New World and that New World had not waived the defense of improper

venue. See generally Ford Glob. Techs., LLC v. New World Int’l Inc., No. 2:15-CV-10394, 2017

WL 5635451 (E.D. Mich. Nov. 7, 2017). The Court thus transferred Ford’s infringement case to

the Northern District of Texas. See Ford Glob. Techs., LLC v. New World Int’l Inc., No. 3:17-cv-

03201-N (N.D. Texas filed Nov. 22, 2017.) Ford’s summary-judgment motion—the one that

mirrors the one the ABPA asks this Court to decide—remains pending before the federal court in

Texas.

II.

The Court now turns to the other threshold issue: whether this case is moot.

On the surface, it seems so. Based on the covenant it has offered and associated

representations it made at oral argument, Ford is willing to irrevocably commit to never suing

New World (and three other entities) for infringing the two patents at issue in this case, the ’299

and ’685 patents. (See R. 63, PID 1104, 1348.) And, as explained, the federal court in Texas

found that the ABPA had standing in this case because Ford had sent New World cease-and-

desist letters. In other words, the ABPA’s standing to seek a declaration that the two patents-in-

suit are invalid or unenforceable was built upon New Worlds’ standing to do so. But now, Ford

Appx0098
2:15-cv-10137-LJM-RSW Doc # 72 Filed 02/20/18 Pg 7 of 25 Pg ID 1709

has cut out that foundation by saying that it will never sue New World for infringing the two

patents-in-suit.

But this case is not between New World and Ford—it is between the ABPA and Ford.

And so if there is a case or controversy between another ABPA member and Ford, the ABPA

could pursue declaratory relief premised on that member’s ability to do so.

In examining this issue, the Court is mindful that after MedImmune, Inc. v. Genentech,

Inc., 549 U.S. 118 (2007), “a declaratory judgment plaintiff does not need to establish a

reasonable apprehension of a lawsuit in order to establish that there is an actual controversy

between the parties.” See SanDisk Corp. v. STMicroelectronics, Inc., 480 F.3d 1372, 1384 (Fed.

Cir. 2007). Instead a “more lenient legal standard,” Micron Tech., Inc. v. Mosaid Techs., Inc.,

518 F.3d 897, 902 (Fed. Cir. 2008), applies: “whether the facts alleged, under all the

circumstances, show that there is a substantial controversy, between parties having adverse legal

interests, of sufficient immediacy and reality to warrant the issuance of a declaratory judgment,”

MedImmune, 549 U.S. at 127.

Considering “all the circumstances,” the controversy between Ford and National

Autobody Parts Warehouse, an ABPA member, is just substantial and just immediate enough

that an opinion on the merits of the ABPA’s two defenses will not be advisory. It appears that

NAPW is a middle-man in the auto-body parts distribution chain: it buys auto-body parts from

manufacturers (or others more upstream than it) and then resells them to repair shops (or others

more downstream than it). (See R. 69, PID 1678–80.) According to NAPW, manufacturers of the

hood and headlamp covered by the two patents in this case have been told by Ford’s exclusive

licensee, LKQ, that if they manufacture the hood and headlamp for anyone but LKQ, they would

“be subject to patent enforcement efforts by” Ford. (R. 69, PID 1680.) Notably, these

Appx0099
2:15-cv-10137-LJM-RSW Doc # 72 Filed 02/20/18 Pg 8 of 25 Pg ID 1710

manufacturers are themselves ABPA members. (R. 69, PID 1680.) Thus, if Ford is willing to sue

those ABPA members for selling the hood and headlamp to NAPW, it seems likely that Ford

would sue NAPW if it, in turn, sold the hood and headlamp to collision repair shops or vehicle

owners.

Of course, an Article III case or controversy cannot be based on a hypothetical—that

NAPW might someday buy the hood and headlamp from a manufacturer and might someday sell

it. But NAPW has averred that in the past, it purchased and sold a hood and a headlamp that Ford

claims are covered by the two patents-in-suit. (R. 69, PID 1679.) And NAPW says it is “ready

and willing” to do so now. (Id.) It has even asked Ford for a license to sell the hood and

headlamp and was denied. (Id.) And it asked Ford’s exclusive licensee to buy the hood and

headlamp from it, but LKQ refused. (Id.) So, on this record, there is more than speculation that

NAPW might sell the hood and headlamp. It has in the past, it wants to now, and has tried to

obtain permission to do so.

The Court is aware that even under MedImmune’s less-stringent test it is not enough that

NAPW subjectively believes that it would be sued for patent infringement if it purchased and

then sold the hood and headlamp—there must be “some affirmative act” by Ford. SanDisk, 480

F.3d at 1380–81; accord Asia Vital Components Co. v. Asetek Danmark A/S, 837 F.3d 1249,

1253 (Fed. Cir. 2016). But there have been affirmative acts by Ford against ABPA members in

the past: the ITC actions and the cease-and-desist letters. See Prasco, LLC v. Medicis Pharm.

Corp., 537 F.3d 1329, 1341 (Fed. Cir. 2008) (“Prior litigious conduct is one circumstance to be

considered in assessing whether the totality of circumstances creates an actual controversy.”).

And there is an affirmative act by Ford against an ABPA member right now: Ford’s lawsuit

against New World alleging infringement of the 13 design patents. Of course, Ford is not suing

Appx0100
2:15-cv-10137-LJM-RSW Doc # 72 Filed 02/20/18 Pg 9 of 25 Pg ID 1711

New World for the two patents at issue in this case and has said it never will. But to the extent

that this would quell NAPW’s fear of suit should it purchase and sell the hood and headlamp,

another fact heightens it: Ford has refused to extend the covenant to all ABPA members and

NAPW specifically.

Thus, while a close call, the Court finds a sufficient case or controversy between Ford

and NAPW. MedImmune, 549 U.S. at 127. And given that NAPW is an ABPA member, it

follows that the ABPA may seek a declaration that the ’299 and ’685 patents are invalid or

unenforceable.

III.

The Court thus turns to the ABPA’s motion for summary judgment.

Here too there is a threshold question: what is the ABPA’s summary-judgment burden?

At trial, an accused infringer must show that a design patent is invalid because it protects

function rather than ornamentation by clear-and-convincing evidence. See Ethicon Endo-

Surgery, Inc. v. Covidien, Inc., 796 F.3d 1312, 1328 (Fed. Cir. 2015). And, at trial, the accused

infringer must show that a patent cannot be enforced against it by a preponderance of the

evidence. Jazz Photo Corp. v. United States, 439 F.3d 1344, 1350 (Fed. Cir. 2006). Thus, the

ABPA moves for summary judgment on issues it has the burden of proof on at trial, which would

usually mean that the ABPA has the considerable summary-judgment burden of showing that

every reasonable jury would find in its favor (clearly and convincingly or by a preponderance, as

the case may be). See Hotel 71 Mezz Lender LLC v. Nat’l Ret. Fund, 778 F.3d 593, 601 (7th Cir.

2015); Surles v. Andison, 678 F.3d 452, 455–56 (6th Cir. 2012).

Appx0101
2:15-cv-10137-LJM-RSW Doc # 72 Filed 02/20/18 Pg 10 of 25 Pg ID 1712

But the ABPA argues that whether a design is directed to function is a question of law

(See R. 39, PID 579.) (Its position on exhaustion is less clear. (See R. 39, PID 580–81.)) It strikes

the Court that even if the ultimate question is one of law, there are often underlying questions of

fact. For example, whether there are alternative designs for the product that allow it to perform

the same function is a question of fact. So to the extent that there are material factual disputes, it

would seem that the ABPA would have the considerable burden of showing that every

reasonable jury would resolve the material factual dispute in its favor. See Hotel 71, 778 F.3d at

601; Surles, 678 F.3d at 455–56.

Ultimately, the Court need not decide whether invalidity due to functionality and

unenforceability due to exhaustion present pure questions of law or mixed questions of law and

fact. The Court will assume in the ABPA’s favor that it only needs to convince this Court that

the two patents in suit are invalid or unenforceable. It may proceed this way because, as will be

explained, the ABPA has not persuaded this Court to find in its favor and so it would follow that

it has not persuaded the Court that every reasonable jury would find in its favor.

The Court now turns to the merits.

The Court starts with the ABPA’s claim that the ’299 and the ’685 patents are invalid.

The Patent Act restricts design-patent protection to “ornamental” designs. See 35 U.S.C. § 171.

The ABPA claims that the designs of the ’299 and the ’685 patents are not ornamental. The

ABPA makes two main arguments in support of this claim: the designs of the two patents-in-suit

are not “a matter of concern” and the two designs are “dictated by function.” (See R. 39, PID

571–74; R. 51, PID 575–76; Case No. 15-10394, R. 104, PID 5586–87.) (The ABPA places its

dictated-by-function argument under the matter-of-concern umbrella (see Case No. 15-10394, R.

10

Appx0102
2:15-cv-10137-LJM-RSW Doc # 72 Filed 02/20/18 Pg 11 of 25 Pg ID 1713

104, PID 5585–86), but whether part of the matter-of-concern test or a separate test for patent

eligibility, the dictated-by analysis is the same.)

The Court considers these two primary arguments in turn and then addresses ABPA’s

related policy arguments. None are convincing.

1.

The “matter of concern” approach to deciding whether a design is entitled to patent

protection is based on a straightforward concept: if no one cares about a particular design, then

the design is not deserving of patent protection. See Application of Stevens, 173 F.2d 1015, 1019

(C.C.P.A. 1949) (“It has been held repeatedly that articles which are concealed or obscure in

normal use are not proper subjects for design patents, since their appearance cannot be a matter

of concern.”). An example of a design that is of no concern is the design for a rotary brush for a

vacuum cleaner that, during its normal use, is concealed from view. Id. at 1019.

The ABPA argues that the designs of the ’299 and ’685 patents are not a matter of

concern because when an F-150 is damaged (say in a crash), the owner simply wants the body

parts that will return her F-150 to the way it looked when it was new. (R. 39, PID 572.) In other

words, the ABPA says that the F-150 owner will not shop around and compare various hood

designs; instead she will, in mechanistic fashion, simply order the hood that came with the truck

when it came off the assembly line. (See R. 39, PID 573; Case No. 15-10394, R. 104, PID 5586–

87.) In further support of this assertion, the ABPA claims that vehicle owners (or collision repair

shops on the owner’s behalf) “typically” order a replacement body part by part number and thus

never even consider the part’s design. (See R. 39, PID 573.) And, says the ABPA, insurance

policies often only cover returning the vehicle to “its pre-loss operational safety, function, and

appearance.” (R. 39, PID 572, 660.) Thus, the ABPA implies that if the owner of an F-150 wants

11

Appx0103
2:15-cv-10137-LJM-RSW Doc # 72 Filed 02/20/18 Pg 12 of 25 Pg ID 1714

her insurer to pay the repair costs, she needs to have her truck restored to the way it looked

before the accident. (See R. 39, PID 572, 577; but see R. 39, PID 627.)

The ABPA has not established a necessary premise of its argument: that the “matter of

concern” inquiry is constrained to the perspective of a vehicle owner at the time that she is

buying a replacement body part, as opposed, for example, to the time she initially buys the truck.

None of the ABPA’s legal authorities—Gorham Manufacturing Co. v. White, 81 U.S. 511

(1871), the district court and Federal Circuit opinions in Best Lock Corp. v. ILCO Unican Corp.,

or the district court and Sixth Circuit opinions in Static Control Components, Inc. v. Lexmark

Int’l, Inc.—establish this premise. Moreover, there is authority to the contrary.

Starting with Gorham, the ABPA relies on this language: “[The acts of Congress which

authorize the grant of patents for designs] manifestly contemplate[] that giving certain new and

original appearances to a manufactured article may enhance its salable value, may enlarge the

demand for it, and may be a meritorious service to the public.” 81 U.S. at 524–25 (emphasis

added). The Court agrees with the ABPA that the references to “salable value” and “demand”

suggest that in deciding whether a design is entitled to patent protection, a court should take into

account whether design plays a role in consumers’ purchase decisions. (See Case No. 15-10394,

R. 104, PID 5582–83.) But even if a consumer’s valuation of the design is key to deciding

whether the design is a matter of concern, it does not follow that it is only the consumer’s

perspective when she seeks to replace the product with the patented design that matters. After all,

an article’s design may have been the very reason the consumer bought the article in the first

place. Or, at least, a reason.

The two Best Lock opinions also do not help the ABPA establish that the design of an

auto-body part is a matter of concern only if it is a matter of concern when the auto-body part is

12

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being replaced. The design patent in Best Lock covered a unique-looking key blade (the portion

of a key that is inserted into a lock). 94 F.3d 1563, 1564–65 (Fed. Cir. 1996). Although the

district court found that the blade’s design was not “a matter of concern to a purchaser,” it did so

by finding that the design of the blade was never a matter of concern to the purchaser:

“Ornamentation, or the aesthetic quality of this design, is not a matter of concern during either

the use of the product or at the time the key or lock is purchased. . . . There is no evidence that at

any time in the commercial process the appearance of the cross-section of the key or keyway

represented a matter of ornamental concern to the purchaser or the user.” 896 F. Supp. 836, 843

(S.D. Ind. 1995) (emphases added). In other words, the district court in Best Lock did not limit

the matter-of-concern inquiry to when a lost key might need to be replaced (at which point

design would obviously not be a matter of concern because the lock owner needs the one key

that will open his lock). And, as will be discussed below, the Federal Circuit’s holding did not

depend on whether the key blade design was a matter of concern to purchasers. See Best Lock, 94

F.3d at 1566.

That leaves the ABPA with the two Static Control opinions. Neither establish the premise

missing from the ABPA’s matter-of-concern argument. Static Control involved a patent for the

design of a toner cartridge. 697 F.3d 387, 421 (6th Cir. 2012). As in Best Lock, the district court

in Static Control found that the appearance of the cartridges were “of no matter of concern

during those cartridges’ entire existence—beginning after completion of manufacture or

assembly and ending with the ultimate destruction, loss, or disappearance of those cartridges.”

487 F. Supp. 2d 830, 839 (E.D. Ky. 2007) (emphasis added). And the Sixth Circuit’s reasoning

largely tracked that of the district court. See 697 F.3d at 422.

13

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In short, none of Gorham, Best Lock, or Static Control limit the matter-of-concern

inquiry to the consumer’s thought process when she is replacing an article with a patented

design. As such, the ABPA has not established a necessary premise of its matter-of-concern

argument.

And, in fact, there is binding precedent that strongly supports a finding that designs for

auto-body parts pass the matter-of-concern test for patent eligibility. At issue in In re Webb was

whether the design for an artificial femur was eligible for patent protection. 916 F.2d 1553, 1555

(Fed. Cir. 1990). The patent examiner and appeal board thought not, reasoning that the femur,

once placed inside the body, would never be seen and thus its aesthetic was of no concern to

anyone. Id. at 1556. The Federal Circuit rejected this argument. It acknowledged that

“replacement items” (like a vacuum cleaner’s rotary brush) are either sold by part number or at

most viewed to assess whether they will do the job; thus, how these items look are of no concern

to consumers. Id. at 1558. But the Federal Circuit pointed out that the design of other items (like

a casket or artificial femur), while of no concern in their ultimate use, are of concern when

marketed. Id. at 1558. Thus, the Court held, “the inquiry must extend to whether at some point in

the life of the article an occasion (or occasions) arises when the appearance of the article

becomes a ‘matter of concern.’” Id. at 1557 (emphasis added).

In re Webb closes the door (or hood) on the ABPA’s matter-of-concern argument. Even if

Ford had not produced considerable evidence on the point (see Case No. 15-10394, R. 99, PID

4455–59), it is beyond reasonable debate that the design of an auto-body part is important to

consumers at least when they are deciding which car to buy. In other words, the look of the

vehicle matters or, in patent parlance, is a matter of concern.

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2.

The ABPA also argues that the designs protected by the ’299 and ’685 patents are not

“ornamental” under § 171 because the designs were “dictated by function.”

Like the matter-of-concern test for design-patent eligibility, the dictated-by-function test

captures a simple concept: if an article had to be designed a certain way for the article to

function, then the design does not deserve patent protection. See Ethicon Endo-Surgery, Inc. v.

Covidien, Inc., 796 F.3d 1312, 1328 (Fed. Cir. 2015). This is for two related reasons. One: the

point of granting monopolies on designs is to encourage people to come up with innovative ones.

See Donald S. Chisum, 8 Chisum on Patents § 23.03[4] at 23–38 (2016). But if a design was

dictated by how the article works, then the design is more byproduct than innovation. See Avia

Grp. Int’l, Inc. v. L.A. Gear California, Inc., 853 F.2d 1557, 1563 (Fed. Cir. 1988) (“When

function dictates a design, protection would not promote the decorative arts, a purpose of the

design patent statute.”), abrogated on other grounds by Egyptian Goddess, Inc. v. Swisa, Inc.,

543 F.3d 665 (Fed. Cir. 2008). Two: if a design patent could protect a design dictated by the

article’s function, then the holder of a design patent would effectively be granted a monopoly on

the function without having to clear the hurdles for obtaining a utility patent, i.e., the monopoly

on function would be unearned. See Chisum, supra, § 23.03[4].

The ABPA asserts that several functions dictate the designs covered by the ’299 and ’685

patents. For one, the ABPA says that the designs for the hood and headlamp are dictated by the

need to physically fit onto the F-150, including mating with the surrounding body parts and

connecting to the truck’s frame. (See R. 39, PID 572; R. 51, PID 1031; Case No. 15-10394, R.

104, PID 5587.) For another, the ABPA says that the designs are dictated by the need to match

the F-150’s overall aesthetic. (See R. 39, PID 572; R. 51, PID 1031; Case No. 15-10394, R. 104,

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PID 5587.) And the ABPA implies that insurance provisions and government regulations dictate

the designs of the hood and headlamp. (See R. 39, PID 572.)

Taking this last point first, the cases the ABPA cites are inapposite. In Application of

Carletti, 328 F.2d 1020, 1021–22 (C.C.P.A. 1964), the court did find that the gasket was

designed to meet military specifications but it also found that the design was simply not for

aesthetics: “[i]t seems naive in the extreme to believe that anyone would try to ‘ornament’ the

rubber gasket on the under side of the bung cap for a gasoline drum.” As for Shop*TV, Inc. v.

Bed Bath & Beyond, Inc., No. 09CV00057, 2010 WL 427782 (D. Colo. Jan. 19, 2010), the

district court later withdrew its adoption of that report and recommendation because the case

settled. See 2010 WL 582165. And legal authority aside, ABPA has no evidence that insurance

provisions or government regulations are so restrictive that auto manufacturers cannot chose how

to design their trucks’ hoods or headlamps. Indeed, a stroll through a used-car lot (or

autotrader.com) reveals just the opposite.

The ABPA’s aesthetic-functionality argument has more merit. Indeed, it has been

accepted in trademark law. Take Deere & Co. v. Farmhand, Inc., 560 F. Supp. 85 (S.D. Iowa

1982), for instance. There, John Deere’s claim of trademark infringement rested in part on the

fact that a competitor had painted its loaders—a bulldozer-like part that attaches to the front of a

tractor—“John Deere green.” See id. at 88–89. While farm-equipment consumers might well

have associated the distinct shade of green with John Deere, the court found that the color could

still not serve as a trademark because the color was aesthetically functional. Id. at 96–99. In

particular, farmers testified that matching the loader’s color with their tractor’s color was an

important factor in choosing which loader to buy. Id. at 91, 98. The ABPA implies that the

situation in this case is similar: just like “John Deere green” allowed one part of the tractor (the

16

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loader) to match the aesthetic of the tractor as a whole, Ford’s designs allow the hood and

headlamp to match the aesthetic of the truck as a whole. (See R. 39, PID 572; Case No. 15-

10394, R. 104, PID 5588.)

For at least three reasons the Court declines to import the aesthetic-functionality doctrine

from trademark law to design-patent law.

First, no court has done so. This despite that both trademarks and design patents have

coexisted for well over a century.

Second, trademark law and patent law serve different purposes. By ensuring that a mark

is associated with a particular source, trademark law simultaneously encourages the mark holder

to make high-quality goods and discourages competitors from selling poor-quality goods under

the guise of the mark. See Qualitex Co. v. Jacobson Prod. Co., 514 U.S. 159, 164 (1995). In

other words, “by protecting a firm’s reputation,” trademark law “seeks to promote competition.”

Id. at 164. In contrast, patents inhibit competition. Schering-Plough Corp. v. F.T.C., 402 F.3d

1056, 1065–66 (11th Cir. 2005) (“By their nature, patents create an environment of exclusion,

and consequently, cripple competition.”); see also Dawson Chem. Co. v. Rohm & Haas Co., 448

U.S. 176, 215 (1980); Retractable Techs., Inc. v. Becton Dickinson & Co., 842 F.3d 883, 893

(5th Cir. 2016). Yet the “policy predicate for the entire [trademark] functionality doctrine stems

from the public interest in enhancing competition.” Keene Corp. v. Paraflex Indus., Inc., 653

F.2d 822, 827 (3d Cir. 1981).

Third, there is greater reason for trademark law to be concerned with functionality

(aesthetic or otherwise) than design-patent law. If a trademark could protect function, the mark

holder would gain a perpetual monopoly over the product’s function without clearing the hurdles

for obtaining any patent—utility or design. See Qualitex, 514 U.S. at 165; Keene, 653 F.2d at

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824. In contrast, those seeking a design patent must clear at least some hurdles related to novelty.

And the term of monopoly is limited to 15 years. Thus, the inequity of a design patent protecting

the aesthetically functional aspect of an article is simply not as great as a trademark doing so.

In short, the ABPA has not persuaded the Court that a design is not entitled to patent

protection if it performs an aesthetic function (like matching the aesthetic of a hood to the

aesthetic of an F-150).

That leaves the ABPA’s claim that the designs of the ’299 and ’685 patents are dictated

by their need to physically fit the F-150. But the need for the hood and headlamp to mate with

surrounding parts and truck frame only restricts the pool of available designs in a limited way.

Those who buy trucks for their looks can imagine a dozen hood and headlamp designs that

would physically fit the existing structure of the F-150. But one does not have to imagine

because Ford has found real-life examples:

Performance Part ’685 patent, Fig. 2. Performance Part ’299 patent, Fig. 1.

(Case No. 15-13094, R. 99, PID 4639–40, 4678–4707, 4714–29.) The fact that there are

“performance parts,” i.e., alternative hood and headlamp designs that both perform their intended

function and fit the F-150, strongly suggests that the designs are not dictated by function. See

Ethicon Endo-Surgery, Inc. v. Covidien, Inc., 796 F.3d 1312, 1329–30 (Fed. Cir. 2015) (“We

have not mandated applying any particular test for determining whether a claimed design is

dictated by its function and therefore impermissibly functional. We have often focused, however,

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on the availability of alternative designs as an important—if not dispositive—factor in evaluating

the legal functionality of a claimed design.”).

The existence of performance parts also serves to distinguish this case from one of the

ABPA’s principle cases that the Court said it would revisit: the Federal Circuit’s opinion in Best

Lock. (See Case No. 15-10394, R. 104, PID 5590–92.) There, the patent holder argued that the

design of the key blade was not dictated by function because there were “unlimited” key blade

and corresponding lock designs. 94 F.3d at 1566. The Federal Circuit rejected this argument. It

noted that the patent was not directed to key-and-lock combination but just a key blade. Id. And,

said the Court, there was exactly one key blade that would physically fit the corresponding lock.

Id. So the blade had to be designed as shown in the patent or it would not serve its intended

function. Id. Here, the existence of performance parts demonstrates that the designs claimed in

the ’299 and ’685 patents are not necessary for the hood and headlamp to perform their intended

functions.

In short, the ABPA has not persuaded the Court that the designs of the ’299 and ’685

patents are dictated by function.

3.

That leaves the ABPA’s policy-based arguments for invalidity.

For one, the ABPA claims that design patents are premised on a quid pro quo: in

exchange for a monopoly on its design, the patent holder contributes to the decorative arts. (R.

39, PID 574–75.) The ABPA thinks that Ford has not kept up its end of the bargain because

“design patent protection for automotive repair parts does not promote the decorative arts or

provide other public benefits.” (R. 39, PID 575.) But it appears that the basis for this last

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statement is that auto-body part designs are dictated by function or of no concern to consumers.

As the Court has rejected these two arguments, the policy argument must be rejected too.

The ABPA also says that if Ford is allowed to protect its designs for F-150 body parts it

is allowed “double recovery”: once when the truck is sold, and then again when the truck is

repaired. (R. 39, PID 575.) But the ABPA has no evidence that the revenue Ford receives by

selling (or licensing LKQ to sell) replacement body parts does not lower the initial sale price of

the vehicle. In any event, if the designs are “ornamental” within the meaning of § 171, then it is

for Congress, not this Court, to address any “double recovery” issues.

The ABPA further identifies a “practical problem that would arise if design patents on

automotive repair parts are not held invalid.” (R. 39, PID 576.) It refers to the fact that patents

give their holders the right to exclude others from using the patented design so, if Ford wanted, it

could decide not to sell any replacement body parts itself and further decide to preclude anyone

else from doing so. (Id.) The result: “if an owner wants an original design, then the owner has to

purchase a new vehicle.” (Id.) But the ABPA offers no evidence to suggest that Ford has any

plans to force its customers to purchase a new vehicle every time a customer’s vehicle sustains

significant body damage. And there are good reasons to think Ford has no such plans: General

Motors, Toyota, Volkswagen, Nissan, Fiat-Chrysler, Honda, etc.

* * *

In sum, the ABPA has not persuaded the Court (by clear and convincing evidence or

otherwise) that Ford’s design patents covering the F-150 hood and headlamp are invalid.

In the alternative, the ABPA argues that the ’299 and ’685 patents are unenforceable

against ABPA members under the doctrine of patent exhaustion. The Court is unpersuaded.

20

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Like the doctrines discussed so far, the patent exhaustion captures a relatively

straightforward concept. Included in a patent holder’s bundle of rights are the rights to exclude

others from selling or using an item covered by her patent. See 35 U.S.C. §§ 154, 171. But when

she sells (or authorizes another to sell) the patented item, she has reaped her reward, and so all

patent rights to that one item are “exhausted.” See Bowman v. Monsanto Co., 569 U.S. 278, 283–

84 (2013). In other words, the authorized sale “confers on the purchaser, or any subsequent

owner, the right to use or sell the [item] as he sees fit.” Id. at 283 (internal quotation marks and

alteration omitted). And the purchaser’s right to use the patented item includes the right to use it

for its lifetime, Adams v. Burke, 84 U.S. 453, 455 (1873), so the doctrine of patent exhaustion

also grants the purchaser of a patented item the right to repair it, Standard Havens Prod., Inc. v.

Gencor Indus., Inc., 953 F.2d 1360, 1376 (Fed. Cir. 1991). And the right to repair the patented

item “includes the right to purchase repair parts.” Standard Havens, 953 F.2d at 1376.

For example, suppose a company holds a patent that covers a knitting machine (but has

no patents covering any individual part of the machine). If the company sells the patented

machine, the machine’s owner can use the machine and, if it breaks, repair the machine without

worry that he is violating the patent-holder’s rights. See Jazz Photo Corp. v. Int'l Trade Comm’n,

264 F.3d 1094, 1102–03 (Fed. Cir. 2001), other grounds abrogated by Impression Prod., Inc. v.

Lexmark Int'l, Inc., 137 S. Ct. 1523 (2017). And the machine’s owner may even repair the

machine by replacing worn out parts, say the knitting machine’s needles, with new ones. Cf.

Wilson v. Simpson, 50 U.S. 109, 125–26 (1850).

But exhaustion has its limits. The authorized sale of a patented item permits the owner to

sell and use the one item that he purchased—not to make a replacement should that one item be

destroyed. See Bowman, 569 U.S. at 283–84. In other words, “the [exhaustion] doctrine restricts

21

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a patentee’s rights only as to the ‘particular article’ sold; it leaves untouched the patentee’s

ability to prevent a buyer from making new copies of the patented item.” Id. at 284 (internal

citations omitted).

A second example helps illustrate this rule. In Aiken v. Manchester Print Works, a

company held a patent that covered unique needles for a knitting machine. See 1 F. Cas. 245

(C.C.D.N.H. 1865). As the company’s sale of a knitting-machine-with-needles bundle exhausted

the company’s patent rights to the needles, the purchaser of the bundle could use the needles and

repair them (say by straightening out a bend). Id. at 247. But the Aiken court held that the

purchaser of the bundle was not permitted to make replacement needles. Id. In reaching its

conclusion that the machine could not be repaired by replacing worn out needles with new ones,

the court explicitly distinguished the first example provided above, i.e., where a patent covered

the knitting machine but no patent covered just the needles. See id. (distinguishing Wilson v.

Simpson, 50 U.S. 109 (1850)). The Supreme Court long ago approved of the reasoning of Aiken,

see Morgan Envelope Co. v. Albany Perforated Wrapping Paper Co., 152 U.S. 425, 434–36

(1894), and the Federal Circuit says that the venerable case is still the law, see Helferich Patent

Licensing, LLC v. N.Y. Times Co., 778 F.3d 1293, 1304 (Fed. Cir. 2015).

These settled rules and accompanying illustrations show that the ABPA’s exhaustion

defense fails as a matter of law. In the ABPA’s view, when Ford sells an F-150, its rights in the

’299 and ’685 are exhausted. (R. 39, PID 583–84.) So, says the ABPA, when an F-150 is

damaged in an accident, the owner of the F-150 has the right to repair it. (R. 39, PID 584.) Thus,

according to the ABPA, the owner may replace the hood and headlamps on the vehicle by

making new ones or by having new ones made for her. (See R. 39, PID 584–85.) The problem

with the ABPA’s argument is that the F-150 is just like the knitting machine in Aiken and its

22

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hood (or headlamp) is just like the needles in Aiken. The patents at issue cover the design for

those two parts—not the design for the truck as a whole—so while the authorized sale of an F-

150 permits the owner to use and repair her hood and headlamp, it does not permit her to make

unauthorized replacements or have replacements made for her.

The ABPA responds that Aiken involved a utility patent while this case involves design

patents. And, says the ABPA, while utility patents are for an article of manufacture, design

patents are for a design for an article of manufacture. Compare 35 U.S.C. § 101, with 35 U.S.C.

§ 171. Thus, the ABPA claims, while a utility patent can only protect an item, a design patent

can protect the design for a portion of an item. (R. 51, PID 1034; Case No. 15-10394, R. 104,

PID 5597); see also Application of Zahn, 617 F.2d 261, 268 (C.C.P.A. 1980) (“While the

[patented] design must be embodied in some articles [of manufacture], the statute is not limited

to designs for complete articles[] or ‘discrete’ articles[.]”). From the ABPA’s perspective then, a

patent protecting a design for one item “is the same as” a patent protecting the design for a

portion of a larger item that includes the other item. (R. 39, PID 589; Case No. 15-10394, R. 104,

PID 5600.) As applied to this case, while the ’299 and ’685 patents protect the design for the

hood and headlamp for an F-150, that is the same as protecting the design for a portion of the F-

150. (See id.) According to the ABPA, this is different than in Aiken where the patent at issue

protected an item, i.e., the needles. (See id.) And, says the ABPA, this difference means that

exhaustion permits repair of the F-150 (not just repair of the hood and headlamps), including by

replacing the truck’s hood and headlamps. (See id.)

There is no case dividing patent law this way—i.e., creating separate exhaustion

doctrines for utility and design patents. Indeed, in Aiken, the needles were not only their own

item but also a necessary part of another: the knitting machine. And so while the needle patent

23

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could be viewed as covering one entire item (a needle), it could also be viewed as covering a

portion of an item that incorporates the other (the knitting machine).

And if there were a case where the ABPA’s distinction would warrant creating separate

exhaustion doctrines for utility and design patents, this is not that case. Like the multi-component

machine with a patented part in Aiken, the F-150 body is comprised of multiple components with

patented parts. This is not a case dealing with a unitary vehicle body, a portion of which is

protected by a design patent. In the event of an accident, F-150 owners do not need to replace the

entire vehicle body as if it were a one-piece shell. They can instead replace separate body parts.

But, as in Aiken, they must do so subject to Ford’s patent rights on those parts.

In short, under the long-standing limits on the doctrine of patent exhaustion, the mere

purchase of an F-150 does not convey to the owner the right to make new auto-body parts

covered by Ford’s design patents. It follows that the owner lacks the right to have those parts

made for her by ABPA members. The ABPA’s exhaustion defense thus fails as a matter of law.

IV.

For the foregoing reasons, the Court finds that this case is not presently moot and thus

DENIES Ford’s motion to dismiss (R. 61). The Court further finds that the ABPA has not shown

that U.S. Patent Nos. D489,299 and D501,685 are invalid because the designs they protect fall

outside the scope of 35 U.S.C. § 171 or that those two patents are unenforceable against ABPA

members because they become exhausted when Ford sells F-150 trucks. It follows that the

ABPA’s motion for summary judgment (R. 39) is DENIED.

Moreover, having considered two full sets of briefing on the ABPA’s two affirmative

defenses, which is the entirety of the ABPA’s declaratory-judgment complaint, the Court intends

to enter judgment in favor of Ford for the reasons set forth in this opinion and pursuant to Rule

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56(f)(1). While Ford has not moved for summary-judgment in this case, it has in the case that

was formerly before this Court and now pending before a federal court in Northern Texas. And

New World—which is represented by the same counsel as the ABPA—responded to that motion

and, at the parties’ urging, this Court considered that response and addressed those arguments in

writing this opinion. Discovery in this case closed over a year ago (R. 35, PID 551), and both

parties’ have indicated, if not outright said, that ABPA’s two defenses could be decided as a

matter of law. The Court thus sees no basis for further argument on the ABPA’s claims of

invalidity and unenforceability.

SO ORDERED.

s/Laurie J. Michelson
LAURIE J. MICHELSON
Dated: February 20, 2018 U.S. DISTRICT JUDGE

CERTIFICATE OF SERVICE

The undersigned certifies that the foregoing document was served upon counsel of record
and any unrepresented parties via the Court=s ECF System to their respective email or First Class
U.S. mail addresses disclosed on the Notice of Electronic Filing on February 20, 2018.

s/Keisha Jackson
Case Manager

25

Appx0117
Form 30

FORM 30. Certificate of Service

UNITED STATES COURT OF APPEALS


FOR THE FEDERAL CIRCUIT

CERTIFICATE OF SERVICE

I certify that I served a copy on counsel of record on IApril 27• 2018


by:

Cusmail
I:IFax
CHand
Iii Electronic Means
(by email or CMIECF)

IRobert G. Oake, Jr. 1/s/ Robert G. Oake, Jr.


Name of Counsel Signature of Counsel

I
Law Firm Oake Law Office

Address 1700 S. Central Expy., Suite 400

I
City, State, ZIP Allen, Texas 75013

TeIeph one Number 1214.207.9066


....
_---------~

FAX Number 1214.383.0865


E-mail Address rg_o_@_o_ak_e-.co-m--~
.-1

NOTE: For attorneys filing documents electronically, the name of the filer
under whose log-in and password a document is submitted must be preceded
by an "/sf' and typed in the space where the signature would otherwise appear.
Graphic and other electronic signatures are discouraged.
No. 18-1613

IN THE
United States Court of Appeals
for the Federal Circuit
___________________
AUTOMOTIVE BODY PARTS ASSOCIATION,
Plaintiff-Appellant,
v.
FORD GLOBAL TECHNOLOGIES, LLC,
Defendant-Appellee.
____________________

Appeal from the U.S. District Court for


the Eastern District of Michigan
The Honorable Laurie J. Michelson
Case No. 2:15-CV-10137
____________________

CORRECTED BRIEF FOR APPELLEE


____________________

Marc Lorelli Jessica L. Ellsworth


Frank A. Angileri Katherine B. Wellington
BROOKS KUSHMAN P.C. HOGAN LOVELLS US LLP
1000 Town Center, 22nd Floor 555 Thirteenth Street, N.W.
Southfield, MI 48075 Washington, D.C. 20004
(248) 358-4400 (202) 637-5600

Counsel for Appellee


Ford Global Technologies, LLC

June 20, 2018


CERTIFICATE OF INTEREST

Counsel for Appellee Ford Global Technologies, LLC certify the following:

1. The full name of every party or amicus represented by me is: Ford

Global Technologies, LLC.

2. The real party in interest is: Ford Global Technologies, LLC.

3. All parent corporations and any publicly held companies that own 10% or

more of the stock of the parties I represent are as follows:

Ford Global Technologies, LLC is a wholly-owned subsidiary of Ford

Motor Company. Ford Motor Company has no parent company and no publicly

held corporation holds 10% or more of its stock.

4. The names of all law firms and the partners or associates that appeared

for the parties now represented by me in the trial court or are expected to appear in

this court are:

Hogan Lovells US LLP (on appeal): Jessica L. Ellsworth and Katherine B.

Wellington.

Brooks Kushman PC (on appeal and in the trial court): Frank A.

Angileri and Marc Lorelli.

Brooks Kushman PC (in the trial court): Amy C. Leshan and Linda D.

Mettes.

Oake Law Office (on appeal and in the trial court): Robert Oake, Jr.

i
Cardelli Lanfear PC (on appeal and in the trial court): Paul M. Kittinger.

Cardelli Lanfear PC (in the trial court): Thomas G. Cardelli.

5. Related cases are disclosed below (at ix) in the Statement of Related

Cases.

/s/ Jessica L. Ellsworth


Jessica L. Ellsworth

Counsel for Appellee


Ford Global Technologies, LLC

Dated: June 20, 2018

ii
TABLE OF CONTENTS
Page

CERTIFICATE OF INTEREST .................................................................................i

TABLE OF AUTHORITIES ..................................................................................... v

STATEMENT OF RELATED CASES ....................................................................ix


INTRODUCTION ..................................................................................................... 1

STATEMENT OF ISSUES PRESENTED FOR REVIEW ...................................... 4


STATEMENT OF FACTS ........................................................................................ 5

SUMMARY OF THE ARGUMENT ...................................................................... 15


ARGUMENT ........................................................................................................... 18

I. STANDARD OF REVIEW...................................................................... 18
II. ABPA’S INVALIDITY ARGUMENT IS MERITLESS. ....................... 20

A. The Hood And Headlamp Designs In The ’299 and


’685 Patents Meet The Patentability Requirements Of
Section 171(a) ................................................................................ 21

B. ABPA’s Invalidity Arguments Are Unsupported By


Precedent And Contrary To Principles Of Design
Patent Law ...................................................................................... 24

1. ABPA’s “Mate And Match” Argument Is


Plainly Wrong ...................................................................... 25

2. The Hood And Headlamp Designs Contain


Conscious Design Choices .................................................. 28

3. ABPA’s Contention That The Designs Of The


Hood And Headlamp Are Not A Matter Of
Concern Is Contrary To Precedent...................................... 30

iii
TABLE OF CONTENTS—Continued
Page

4. The Trademark Law Concept of “Aesthetic


Functionality” Has No Relevance To Whether
A Design Is Ornamental Under The Design
Patent Statute ....................................................................... 33

5. The Validity Of A Patent Does Not Depend On


The Market ........................................................................... 35

III. THE EXHAUSTION DOCTRINE DOES NOT EXCUSE


BLATANT COPYING OF PATENTED DESIGNS BY
ABPA’S MEMBERS ............................................................................... 37
A. 150-Year-Old Precedent Establishes That The Right
To Repair Does Not Extend To Separately Patented
Repair Parts .................................................................................... 37

B. This Court Should Reject ABPA’s Attempt To Create


A New Exhaustion Regime For Design Patents ............................ 41
C. The Sale Of An F-150 Does Not Grant An Implied
License To Manufacture New Copies Of The Hood
And Headlamp ............................................................................... 42

D. As Upstream Manufacturers, ABPA’s Members Are


Not Entitled To Assert Exhaustion As A Defense ......................... 43

CONCLUSION ........................................................................................................ 46
CERTIFICATE OF SERVICE

CERTIFICATE OF COMPLIANCE

iv
TABLE OF AUTHORITIES
Page(s)

CASES:
Aiken v. Manchester Print Works,
2 Cliff. 435 (1865) .......................................................................................passim
Aro Mfg. Co. v. Convertible Top Replacement Co.,
365 U.S. 336 (1961) ................................................................................17, 39, 40

Asetek Holdings, Inc. v. CoolIT Sys., Inc.,


No. C-12-4498 EMC, 2013 WL 5640905 (N.D. Cal. Oct. 11, 2013) ................ 45

Auto. Body Parts Ass’n v. Ford Glob. Techs., LLC,


No. 4:13-cv-00705 (E.D. Tex. Nov. 25, 2013) ................................................... 10

Best Lock Corp. v. Ilco Unican Corp.,


94 F.3d 1563 (Fed. Cir. 1996) .....................................................................passim
Bowman v. Monsanto Co.,
569 U.S. 278 (2013) ......................................................................................17, 40

Brunswick Corp. v. British Seagull Ltd.,


35 F.3d 1527 (Fed. Cir. 1994) ............................................................................ 34

Citigroup Inc. v. Capital City Bank Grp., Inc.,


637 F.3d 1344 (Fed. Cir. 2011) .......................................................................... 36

Cobra Int’l, Inc. v. BCNY Int’l, Inc.,


702 F. App’x 994 (Fed. Cir. 2017) ....................................................................... 4

CoreBrace LLC v. Star Seismic LLC,


566 F.3d 1069 (Fed. Cir. 2009) .......................................................................... 44

Crossroads Sys., Inc. v. Dot Hill Sys. Corp.,


48 F. Supp. 3d 984 (W.D. Tex. 2014) ..........................................................18, 44
Deere & Co. v. Farmhand, Inc.,
560 F. Supp. 85 (S.D. Iowa 1982), aff’d, 721 F.2d 253 (8th Cir. 1983) ............ 34
Eli Lilly & Co. v. Barr Labs., Inc.,
251 F.3d 955 (Fed. Cir. 2001) ............................................................................ 19

v
TABLE OF AUTHORITIES—Continued
Page(s)

Ethicon Endo-Surgery, Inc. v. Covidien, Inc.,


796 F.3d 1312 (Fed. Cir. 2015) ........................................................18, 20, 22, 24

Ex parte Adams,
84 Off. Gaz. Pat. Office 311 (1898) ................................................................... 21

Fuji Photo Film Co. v. Int’l Trade Comm’n,


474 F.3d 1281 (Fed. Cir. 2007) .......................................................................... 19

Glob. Commc’ns, Inc. v. DirecTV, Inc.,


1 F. Supp. 3d 1305 (N.D. Fla. 2014) .................................................................. 44

Gorham Co. v. White,


81 U.S. (14 Wall.) 511 (1871) ........................................................................ 2, 15

Helferich Patent Licensing, LLC v. New York Times Co.,


778 F.3d 1293 (Fed. Cir. 2015) ....................................................................17, 40

Hewlett-Packard Co. v. Repeat-O-Type Stencil Mfg. Corp.,


123 F.3d 1445 (Fed. Cir. 1997) .......................................................................... 43

Impression Prods., Inc. v. Lexmark Int’l, Inc.,


137 S. Ct. 1523 (2017) ........................................................................................ 17
In re Carletti,
328 F.2d 1020 (C.C.P.A. 1964) .......................................................................... 29
In re Cornwall,
230 F.2d 457 (C.C.P.A. 1956) ............................................................................ 31
In re Eppinger,
94 F.2d 401 (C.C.P.A. 1938) .............................................................................. 34
In re Stevens,
173 F.2d 1015 (C.C.P.A. 1949) .......................................................................... 31

In re Webb,
916 F.2d 1553 (Fed. Cir. 1990) ........................................................30, 31, 32, 36

vi
TABLE OF AUTHORITIES—Continued
Page(s)

In re Zahn,
617 F.2d 261 (C.C.P.A. 1980) ......................................................................20, 21

Jazz Photo Corp. v. Int’l Trade Comm.,


264 F.3d 1094 (Fed. Cir. 2001), abrogated on other grounds by
Impression Prods., Inc. v. Lexmark Int’l, Inc., 137 S. Ct. 1523
(2017) ......................................................................................................17, 37, 40

Keurig, Inc. v. Sturm Foods, Inc.,


732 F.3d 1370 (Fed. Cir. 2013) .......................................................................... 19

Leary v. Daeschner,
349 F.3d 888 (6th Cir. 2003) ........................................................................19, 20

Morgan Envelope Co. v. Albany Perforated Wrapping Paper Co.,


152 U.S. 425 (1894) .....................................................................................passim

MRC Innovations, Inc. v. Hunter Mfg., LLP,


747 F.3d 1326 (Fed. Cir. 2014) ............................................................................ 4

Qualitex Co. v. Jacobson Prods. Co.,


514 U.S. 159 (1995) ............................................................................................ 34
Rosco, Inc. v. Mirror Lite Co.,
304 F.3d 1373 (Fed. Cir. 2002) ..............................................................15, 16, 22
Samsung Elecs. Co. v. Apple Inc.,
137 S. Ct. 429 (2016) ..........................................................................2, 20, 21, 42
Static Control Components, Inc. v. Lexmark Int’l, Inc.,
697 F.3d 387 (6th Cir. 2012) .......................................................................passim

TC Heartland LLC v. Kraft Foods Grp. Brands LLC,


137 S. Ct. 1514 (2017) ........................................................................................ 12

Wilson v. Simpson,
50 U.S. (9 How.) 109 (1850) ........................................................................38, 39

vii
TABLE OF AUTHORITIES—Continued
Page(s)

STATUTE:
35 U.S.C. § 171(a) .......................................................................................15, 21, 22

RULE:
Fed. R. Civ. P. 56(f)(1) ......................................................................................14, 15

LEGISLATIVE MATERIAL:
H.R. 5638, 110th Cong. (2008)................................................................................ 10
S. 780, 113th Cong. (2013) ...................................................................................... 10

OTHER AUTHORITIES:
Intervenor/Appellants’ Br., Ford Glob. Techs., LLC v. Int’l Trade Comm’n,
Nos. 07-1357, 07-1526 (Fed. Cir. Apr. 21, 2008), 2008 WL 1995548 ................ 9
In re Certain Automotive Parts, Inv. No. 337-TA-557, USITC Pub.
4012 (June 6, 2007) (Final), available at
https://www.usitc.gov/publications/337/pub4012.pdf .......................................... 9

viii
STATEMENT OF RELATED CASES

1. Automotive Body Parts Association previously filed a petition for a

writ of mandamus in this case, titled In re Automotive Body Parts Association, No.

15-156. The panel was composed of Judge Lourie, Judge Dyk, and Judge Hughes.

Judge Dyk authored the order denying the petition on November 17, 2015. The

order is unreported, but it is reproduced at Appx1018-1020.

2. Ford Global Technologies, LLC v. New World International, Inc., No.

3:17-cv-03201, pending in the U.S. District Court for the Northern District of

Texas, involves, in part, the same issues that are presented as this appeal and

therefore will be directly affected, in part, by the Court’s decision in this appeal.

3. Counsel for Ford Global previously identified two other related cases

in an earlier filing in this appeal, but they are no longer pending:

a. New World International, Inc. v. Ford Global Technologies,

LLC, No. 17-1956, was decided by this Court on March 13, 2018. A

petition for panel rehearing and rehearing en banc was denied on May 29,

2018, and this Court issued its mandate on June 5, 2018.

b. New World International, Inc. v. Ford Global Technologies,

LLC, No. 16-2097, was decided by this Court on June 8, 2017. The mandate

was issued by this Court on July 17, 2017.

ix
IN THE
United States Court of Appeals
for the Federal Circuit
___________________

AUTOMOTIVE BODY PARTS ASSOCIATION,


Plaintiff-Appellant,
v.
FORD GLOBAL TECHNOLOGIES, LLC,
Defendant-Appellee.
____________________

Appeal from the U.S. District Court for


the Eastern District of Michigan
The Honorable Laurie J. Michelson
Case No. 2:15-CV-10137
____________________

BRIEF FOR APPELLEE


____________________

INTRODUCTION
Members of the Automotive Body Parts Association (ABPA) want to import

and sell unlicensed copies of Ford auto-body parts that infringe design patents on

those parts held by Ford Global Technologies, LLC (Ford Global). To that end,

more than a decade ago, they came up with the theory that design patents on auto-

body parts are uniquely invalid—or at least unenforceable against ABPA members.

This theory depends on ignoring two basic undisputed facts: (1) extensive artistic

work goes into designing automobiles and their component parts and (2) a variety

of alternatives exist for auto-body parts including, among others, parts sold by

manufacturers in different trim packages and performance parts sold by others. It

1
also depends on ignoring the law. The Supreme Court held more than a century

ago that designs for component parts are patentable—a holding that it reaffirmed

just two years ago. ABPA’s theory snubs the facts and contradicts well-established

law.

ABPA or its members have been pressing their theory in various venues—all

of which have rejected them. ABPA members first advanced their theory before

the International Trade Commission, and got nowhere. They then made the same

arguments before Congress, and again got nowhere. And yet again, they got

nowhere when ABPA asserted these same arguments before the District Court in

this case. Since that ruling, ABPA’s position has been rejected by another district

court as well. In this fifth attempt, ABPA seeks to convince this Court to overturn

over a century of patent law and create a unique framework to assess design

patents on auto-body parts. This Court should reject that attempt.

The Supreme Court has sanctioned design patents on a component of a

larger article since 1871, when it found infringement of a design patent on a

silverware handle in Gorham Co. v. White, 81 U.S. (14 Wall.) 511, 530-531

(1871). The Supreme Court revisited the same issue two years ago, and there too

concluded that the design of a component part may be patented. See Samsung

Elecs. Co. v. Apple Inc., 137 S. Ct. 429, 435 (2016). In a bid to avoid this

precedent, ABPA contends that automotive component designs are uniquely

unpatentable because those components must “mate and match” with the vehicle,

2
and because consumers do not care about the design of those components when

replacing them after a collision. Under this Court’s precedent, however, a design

is unpatentable when it is the only design that will work and when the appearance

of an article is never a matter of concern. Neither is true here.

Because ABPA cannot make out its case under this Court’s patent

precedents, it attempts to rely on principles of trademark law. ABPA asserts that

this Court should apply the trademark concept of “aesthetic functionality” to

design patents and that it should consider the specific market in which an article is

sold. Those concepts, however, are unique to trademark law and have no

application in this patent context.

ABPA also argues that Ford Global’s patents are unenforceable against sales

of replacement parts that ABPA members engage in, because the sale of a vehicle

to a consumer forever exhausts all design patents on any component part of that

vehicle. Once again, ABPA’s position is squarely foreclosed by precedent. It has

been established since the Civil War that the exhaustion doctrine does not permit a

consumer to create (or purchase) a new copy of a patented article. See Aiken v.

Manchester Print Works, 2 Cliff. 435 (1865); see also Morgan Envelope Co. v.

Albany Perforated Wrapping Paper Co., 152 U.S. 425, 435 (1894) (adopting

Aiken). ABPA’s contorted attempts to escape this precedent are unavailing.

The District Court carefully evaluated—and squarely rejected—ABPA’s

arguments. Because ABPA cannot make out its case for invalidity or

3
unenforceability, the District Court properly denied ABPA’s motion for summary

judgment and entered judgment in favor of Ford Global.

STATEMENT OF ISSUES PRESENTED FOR REVIEW

1. Whether the District Court properly granted summary judgment to

Ford Global on ABPA’s declaratory judgment action asserting invalidity after

concluding that auto-body parts are not categorically ineligible for design patent

protection.

2. Whether the District Court properly granted summary judgment to

Ford Global on ABPA’s declaratory judgment action seeking a ruling of

unenforceability after concluding that design patents for auto-body parts are not

exhausted by an initial vehicle sale to a consumer and thus are enforceable against

ABPA’s members’ sales of replacement parts.1

1
ABPA (at 2) frames the issues presented as both the grant of summary
judgment to Ford Global and the denial of summary judgment to ABPA on these
two issues. It is unclear whether the denial of ABPA’s request for summary
judgment in its favor is a final appealable decision. Compare MRC Innovations,
Inc. v. Hunter Mfg., LLP, 747 F.3d 1326, 1336 (Fed. Cir. 2014) (“[A] denial of a
motion for summary judgment is not a final appealable decision.”), with Cobra
Int’l, Inc. v. BCNY Int’l, Inc., 702 F. App’x 994, 995-996 (Fed. Cir. 2017) (per
curiam) (suggesting that the denial of summary judgment may be reviewable in
some circumstances). To the extent the District Court’s denial of ABPA’s
summary judgment motion is reviewable, this Court should affirm. As described
in this brief, Ford Global’s patents are valid and enforceable.

4
STATEMENT OF FACTS

The Art of Designing the F-150 Truck. The redesigned F-150 truck

debuted in model year 2004. To create the truck’s new design, Ford Global

employed a team of artists, including Jeffery Nowak, Craig Metros, Patrick

Schiavone, and Tyler Blake. See Appx174, Appx183. All four attended the

College for Creative Studies, a well-known art and design school in Detroit with a

vehicle design program. Appx2538. Artists interested in vehicle design flock to

the College for Creative Studies for training. See Appx2533, Appx3305. Ford

Global’s artists received instruction in drawing, illustration, and automotive design

as part of their degree program. See Appx3306.

Redesigning the F-150 truck was a lengthy, creative process. It began with a

discussion of the story that the vehicle was intended to tell. See Appx271. Ford

Global’s designers then began sketching ideas, leading to the development of

different design themes. See Appx270, Appx3267. After hundreds of sketches

were created and evaluated, most were discarded. See Appx3267-3268. For the

remaining designs, Ford’s artists sculpted clay models, repeatedly changing and

refining the design. See Appx272-273, Appx3268, Appx3271. Ford Global’s

artists then focused on the design for each individual vehicle component. See

Appx3279, Appx3295. Metros, the lead artist for the F-150 truck, ultimately

selected the final designs for the truck and for each component. See Appx3291.

5
As Schiavone testified, “[a]ll details of the exterior appearance of the 2004

Ford F-150 truck were created by the design team to be attractive and aesthetically

desirable.” Appx2538. In contrast to the design team’s role, the engineering team

for the F-150 truck was not involved in the design process. The engineering team

was asked only to confirm that the design developed by the artistic team was

feasible and could be manufactured. See Appx2538-2539, Appx3299. The F-

150’s redesign won numerous prestigious awards, including the 2004 North

American Truck of the Year award, the 2004 Motor Trend Truck of the Year, and

the 2004 Car and Driver Best Pickup Truck. Appx2558, Appx2560-2561,

Appx2565.

Ford Global obtained design patents on select components of the redesigned

F-150 truck, including the hood and headlamp. See Appx862. Design patent

D489,299 (’299 patent), issued May 4, 2004, claims the design used on the

redesigned F-150 hood. See Appx174-182. Design patent D501,685 (’685 patent),

issued February 8, 2005, claims the design used on the redesigned F-150

headlamp. See Appx183-193. The hood and headlamp designs are reproduced

below:

6
F-150 Hood F-150 Headlamp
’299 Patent ’685 Patent

See Appx174-193. These designs were used on the F-150 truck from

approximately model year 2004 to model year 2008. See Appx2225.

The Market For Alternative Parts. In addition to the standard

components designed by Ford Global’s artists, a variety of other parts are available

for the redesigned F-150 truck. Ford Motor Company offered different trim

packages for the F-150 truck, including four different grille designs. See

Appx1517; see also Appx2440 (depicting different designs). Other companies

manufacture and sell “performance parts” for the redesigned F-150 truck. As

ABPA’s expert explained, consumers purchase these performance parts because

they want components that “look different” but “still function[ ]” in the same way.

Appx1312; see also Appx940-941, Appx1296 (ABPA admissions), Appx1502.

Some consumers, for example, “desire [a] different appearance of a headlamp” or a

hood with “a different design.” Appx1313. Performance parts are available for

7
both the redesigned F-150 hood and headlamp. See Appx110, Appx1340 (ABPA

admissions).

If an individual consumer requests it, auto-body repair shops install these

performance parts in lieu of the original components designed by Ford Global’s

artists. See Appx1312-1314 (ABPA witness describing performance parts as

functionally the same but “sport[ier]”). As ABPA Board Member and New World

executive Joseph Tsai testified, performance parts “mate and fit with the original

vehicles” and “can be installed on [the] vehicles for which they are intended.”

Appx941; see also Appx1330 (“ABPA admits that the identification of a part as a

performance part in the Partslink database status field indicates that the

performance part will fit the associated vehicle specified by the Partslink

numbering system but may differ in appearance from the original part.”).

The History of the Parties’ Dispute. This appeal is the culmination of

ABPA’s prolonged effort to invalidate design patents on automotive components

so that its members can sell unlicensed knock-off versions of those parts.2 Ford

Global, the wholly-owned subsidiary of Ford Motor Company that owns, manages,

and licenses intellectual property, filed a complaint in 2005 with the U.S.

2
ABPA is trade association for automotive parts distributors. Appx94. Those
distributors purchase automotive repair parts from manufacturers or distributors
and then resell those parts to repair shops or vehicle owners. ABPA Br. 6. ABPA
members include New World International, Inc. (New World), LKQ Corporation,
and National Autobody Parts Warehouse. Appx95, Appx99.

8
International Trade Commission (ITC) to stop ABPA members from infringing

certain of Ford Global’s design patents on automotive parts. Appx266. In the ITC

proceedings, ABPA members asserted that design patents on automotive

components are not ornamental and thus invalid, and that such patents are

exhausted after a sale and thus unenforceable against replacement parts. See

Appx236, Appx251-252, Appx267-268.

An administrative law judge for the ITC rejected both arguments. As the

judge explained, the existence of alternative designs for auto-body parts

demonstrates that those designs are ornamental rather than functional. See

Appx255-256, Appx268. With respect to exhaustion, the judge held that to

“permit [ABPA’s members] to manufacture and/or distribute new ‘crash parts’ for

F-150 trucks without [Ford Global’s] authority would be in essence to nullify the

presumed-to-be-valid design patents that [Ford Global] has obtained on individual

pieces of the F-150.” Appx241; see also Appx267. The ITC did not disturb those

rulings, nor did ABPA’s members appeal them to the Federal Circuit.3

The Automotive Parts Industry Appeals To Congress. Following their

loss in the ITC proceedings, the automotive parts distributors turned to Congress.

3
See In re Certain Automotive Parts at 2, Inv. No. 337-TA-557, USITC Pub.
4012 (June 6, 2007) (Final), available at https://www.usitc.gov/publications/
337/pub4012.pdf; Intervenor/Appellants’ Br. at 3, Ford Glob. Techs., LLC v. Int’l
Trade Comm’n, Nos. 07-1357, 07-1526 (Fed. Cir. Apr. 21, 2008), 2008 WL
1995548. ABPA’s members appealed other issues, see id., and the case ultimately
settled. Appx95.

9
In 2008, the House of Representatives considered—but did not enact—a bill to

exclude automotive repair parts from design patent protections. See H.R. 5638,

110th Cong. (2008), Appx661-662. In 2013, a similar bill was introduced in the

Senate, but it too failed to gain traction. See S. 780, 113th Cong. (2013),

Appx664-667.

ABPA’s Suit Against Ford Global. After failing before both the ITC and

Congress, ABPA filed this declaratory judgment suit against Ford Global in the

Eastern District of Texas. See Complaint, Auto. Body Parts Ass’n v. Ford Glob.

Techs., LLC, No. 4:13-cv-00705 (E.D. Tex. Nov. 25, 2013) (ABPA suit). ABPA

once again raised the same arguments that had been rejected in the ITC

proceedings: That Ford Global’s design patents were invalid because automotive

component designs are functional, not ornamental, and that they are unenforceable

against replacement parts because Ford Global’s patent rights are exhausted by the

initial sale of the vehicle to a consumer. See Appx983. ABPA initially challenged

six of Ford Global’s design patents. See Appx997.

Ford Global moved to dismiss on the basis (among other things) that ABPA

was not an adequate representative of its members. See Appx210-213. One of its

members, LKQ Corporation, is licensed by Ford Global to sell automotive parts

protected by Ford Global’s design patents. See Appx95. The Eastern District of

Texas denied Ford Global’s motion and held that ABPA had standing to challenge

the patents based on an alleged injury to another member, New World. See

10
Appx972-978.

Shortly after that ruling, ABPA amended its complaint to challenge only the

’299 and ’685 patents, which claim the design of the hood and headlamp used on

the redesigned F-150 truck. See Appx96, Appx997.4 Ford Global moved to

transfer venue to the Eastern District of Michigan, and the Eastern District of

Texas granted the motion. See Appx1009-1010; see also Appx1018-1020

(denying mandamus petition challenging the change of venue). The case was

assigned to Judge Michelson. See Appx129.

Ford Global’s Suit Against New World. Following the venue transfer of

ABPA’s suit against Ford Global, Ford Global filed an infringement action against

ABPA member New World in the Eastern District of Michigan. See Complaint,

Ford Glob. Techs., LLC v. New World Int’l, Inc., No. 2:15-cv-10394 (E.D. Mich.

Jan. 29, 2015) (New World suit). The New World suit was assigned to Judge

Michelson’s docket as a companion to the present case. See Appx138.

ABPA and New World Summary Judgment Motions. ABPA filed for

summary judgment in its suit against Ford Global. Appx97. ABPA asserted that

the ’299 and ’685 patents are invalid because the designs for the covered

4
Although the amended complaint only challenged these two patents,
ABPA’s arguments were far broader. As the District Court recognized, “ABPA’s
arguments are not specific to those two patents,” and ABPA instead seeks a ruling
“that designs for auto-body parts are simply not eligible for patent protection” and
that Ford Global’s patents “are unenforceable against its members.” Appx93.

11
components are functional rather than ornamental and are not a matter of concern.

See Appx102. ABPA also asserted that the patents are unenforceable because the

original vehicle sale to a consumer exhausts the design patents on the vehicle’s

components, such that they cannot be enforced against replacement parts sold by

ABPA’s members. See Appx112-114. Ford Global detailed the many flaws in

these arguments. See Appx1240-1258.

In the New World suit, New World—represented by the same counsel as

ABPA—filed a parallel motion for summary judgment asserting the same two

arguments as affirmative defenses to Ford Global’s infringement contention.

Appx97. When New World withdrew that motion, Ford Global filed its own

motion for summary judgment, explaining that its patents were not invalid or

unenforceable. See Appx2431-2452. Given the overlapping issues in ABPA and

New World, the parties agreed that Judge Michelson should consider the arguments

presented by the parties in both cases in deciding ABPA’s and Ford Global’s

summary judgment motions. See Appx97.

Transfer of New World to Texas. While the two summary judgment

motions were pending, however, the Supreme Court held that the patent venue

statute had a narrower scope than prior case law provided. See TC Heartland LLC

v. Kraft Foods Grp. Brands LLC, 137 S. Ct. 1514 (2017). Based on TC Heartland,

Judge Michelson transferred Ford Global’s infringement suit against New World to

the Northern District of Texas without ruling on Ford Global’s summary judgment

12
motion. See Appx98; see also Ford Glob. Techs., LLC v. New World Int’l Inc.,

No. 3:17-cv-03201-N.

Denial of ABPA’s Summary Judgment Motion. Judge Michelson

thoroughly addressed and rejected ABPA’s arguments seeking summary judgment

in its favor. The court’s ruling first evaluated ABPA’s burden at summary

judgment.5 Because ABPA’s burden at trial would be to demonstrate invalidity by

clear and convincing evidence and unenforceability by a preponderance of the

evidence, the court explained that to prevail at the summary-judgment stage,

ABPA would have to show that every reasonable juror would find in its favor

either clearly and convincingly, or by a preponderance, depending on the issue.

Appx101. The court concluded that ABPA had not met that burden.

The court rejected ABPA’s argument that Ford Global’s patents are invalid

because the design of those patents is not a matter of concern, concluding that “it is

beyond reasonable debate that the design of an auto-body part is important to

consumers at least when they are deciding which car to buy.” Appx106. The court

also rejected ABPA’s argument that Ford Global’s patents are invalid because the

5
During the proceedings before Judge Michelson, Ford Global offered a
covenant not to sue New World for infringement of the ’299 and ’685 patents. See
Appx97-98. As a result of that covenant, Judge Michelson concluded that the
controversy between Ford Global and New World was moot. See Appx98-99.
Judge Michelson ruled that the case was not moot, however, because a controversy
remained between Ford Global and National Autobody Parts Warehouse, another
ABPA member. See Appx98-99.

13
hood and headlamp designs are not ornamental. As it explained, the “fact that

there are ‘performance parts,’ i.e., alternative hood and headlamp designs that both

perform their intended function and fit the F-150, strongly suggests that the designs

are not dictated by function.” Appx110. Finally, the court declined ABPA’s

request to dramatically alter the line between ornamentality and functionality in

design patent law by importing the concept of “aesthetic functionality” from

trademark law into design patent law. As the court pointed out, no other court had

ever done so, and trademark and patent law serve different purposes. See

Appx108-110.

With respect to ABPA’s assertion that Ford Global’s patents are

unenforceable due to exhaustion, the court held that although “the authorized sale

of an F-150 permits the owner to use and repair her hood and headlamp, it does not

permit her to make unauthorized replacements or have replacements made for her.”

Appx115. The court similarly rejected ABPA’s assertion that separate exhaustion

regimes should apply to utility and design patents. See id. The court accordingly

denied ABPA’s motion for summary judgment. Appx116.

After “having considered two full sets of briefing on the ABPA’s two

affirmative defenses, which is the entirety of the ABPA’s declaratory-judgment

complaint,” the court stated that it intended “to enter judgment in favor of [Ford

Global] for the reasons set forth in [its] opinion and pursuant to Rule 56(f)(1).”

Appx116-117.

14
ABPA Requests Entry of Judgment. Following the District Court’s

ruling, ABPA requested entry of judgment against it under Rule 56(f)(1).

Appx2148. After the court entered judgment, Appx91, ABPA appealed.

Northern District of Texas Grants Summary Judgment to Ford Global

in New World. Agreeing with the reasoning in the District Court’s ruling rejecting

ABPA’s arguments, the Northern District of Texas granted summary judgment to

Ford Global on its summary judgment motion in the New World suit. Appx173

(Docket Entry 202). That summary judgment ruling resolved New World’s

affirmative defenses, and Ford Global’s infringement suit against New World is set

for trial in November 2018.

SUMMARY OF THE ARGUMENT

I. The District Court correctly granted summary judgment to Ford

Global on the question whether its design patents on the hood and headlamp for its

F-150 truck are valid. The Supreme Court has long recognized that a design for a

component part may be protected by a patent as long as the design is new, original,

and ornamental. See Gorham, 81 U.S. (14 Wall.) at 525-531; see also 35 U.S.C.

§ 171(a). ABPA does not contest the novelty or originality of the hood and

headlamp designs. ABPA instead argues that those designs—which were created

from scratch by trained artists employed by Ford—are functional rather than

ornamental. But a design is functional only if it is “the only possible form of the

article that could perform its function.” Rosco, Inc. v. Mirror Lite Co., 304 F.3d

15
1373, 1378 (Fed. Cir. 2002) (emphasis added; internal quotation marks omitted).

Here, numerous alternative designs for the hood and headlamp exist, including

performance parts sold by other manufacturers, as ABPA concedes. See

Appx1340. Ford Global’s design patents are accordingly ornamental and eligible

for patent protection.

ABPA does not contend that the hood and headlamp designs are functional

as a “mechanical” or “utilitarian” matter. ABPA Br. 23 (internal quotation marks

omitted). Rather, ABPA asserts that those designs are functional because

automotive components must “mate and match” with the vehicle in the same way a

key must “mate and match” with a lock. See id. at 19-22. That is clearly wrong:

There are many different ways to design an automotive component that will fit on

the F-150 truck, as the robust market for performance parts demonstrates.

ABPA also asserts that the hood and headlamp designs cannot be patented

because those components do not contain any design choices, and because the

design for such components is not a matter of concern. But that is clearly wrong

too: The components of the F-150 truck were crafted by talented artists, are visible

on the exterior of the vehicle, and are selected by consumers because of the way

they look.

In a last-ditch effort, ABPA asks this Court to create a newfound “aesthetic

functionality” limitation on ornamentality. This narrow trademark law concept

serves an entirely different purpose and has never been used by any court to define

16
the boundaries of patent law. This Court should reject ABPA’s unprecedented

request and affirm the District Court’s ruling that Ford Global’s patents are valid.

II. As a fallback, ABPA asserts that Ford Global’s design patents are

unenforceable against its members’ sales of replacement parts under the exhaustion

doctrine. That doctrine holds that the unrestricted sale of a patented article

exhausts the patentee’s right to control further use or sale of the article by

enforcing the patent under which it was first sold. Jazz Photo Corp. v. Int’l Trade

Comm., 264 F.3d 1094, 1105 (Fed. Cir. 2001), abrogated on other grounds by

Impression Prods., Inc. v. Lexmark Int’l, Inc., 137 S. Ct. 1523 (2017). The

exhaustion doctrine, however, “leaves untouched the patentee’s ability to prevent a

buyer from making new copies of the patented item.” Bowman v. Monsanto Co.,

569 U.S. 278, 284 (2013) (emphasis added).

Here, the sale of an F-150 truck exhausts Ford Global’s design patent rights

in the actual hood and headlamp parts attached to the vehicle that a consumer

drives off the dealership lot. But it does not exhaust Ford Global’s design patent

rights in new hoods and headlamps that are available for sale as replacement parts.

See id. This long-established principle was first articulated in Aiken and adopted

by the Supreme Court in Morgan Envelope. It has since been reaffirmed by the

Supreme Court in Aro Mfg. Co. v. Convertible Top Replacement Co., 365 U.S. 336,

339-343 (1961), and by this Court in Helferich Patent Licensing, LLC v. New York

Times Co., 778 F.3d 1293, 1304 (Fed. Cir. 2015). Those precedents foreclose

17
ABPA’s exhaustion argument in this case. And moreover, because ABPA’s

members are upstream manufacturers, they are not entitled to exert exhaustion as a

defense in the first place. See Crossroads Sys., Inc. v. Dot Hill Sys. Corp., 48 F.

Supp. 3d 984, 990-991 (W.D. Tex. 2014).

Undeterred, ABPA conjures up the idea that this Court should create a new

exhaustion regime applicable only to design patents under which exhaustion

somehow runs differently for design patents than utility patents. ABPA’s

arguments lack merit and defy common sense. This Court should affirm the

judgment below.

ARGUMENT

I. STANDARD OF REVIEW.
Like all issued patents, design patents are presumed valid. See Ethicon

Endo-Surgery, Inc. v. Covidien, Inc., 796 F.3d 1312, 1328 (Fed. Cir. 2015). It is

accordingly ABPA’s burden to prove invalidity by clear and convincing evidence.

See id. A design patent is invalid if, rather than being ornamental, “its overall

appearance is dictated by function.” See id. at 1333. This is a “stringent” standard

to meet: ABPA must demonstrate by clear and convincing evidence that no other

designs, apart from those claimed in Ford Global’s patents, would perform the

intended function. Id. at 1328, 1332 (internal quotation marks omitted). It is

likewise ABPA’s burden to prove that Ford Global’s patents are unenforceable by

18
a preponderance of the evidence. See Fuji Photo Film Co. v. Int’l Trade Comm’n,

474 F.3d 1281, 1293 (Fed. Cir. 2007).

Where there “are no disputed factual questions,” an issue may be decided at

summary judgment. Keurig, Inc. v. Sturm Foods, Inc., 732 F.3d 1370, 1373 (Fed.

Cir. 2013). In “evaluating a motion for summary judgment,” this Court “views the

record evidence through the prism of the evidentiary standard of proof that would

pertain at a trial on the merits.” Eli Lilly & Co. v. Barr Labs., Inc., 251 F.3d 955,

962 (Fed. Cir. 2001). Thus, “a moving party seeking to invalidate a patent at

summary judgment must submit clear and convincing evidence of invalidity so that

no reasonable jury could find otherwise.” Id. Likewise, “a moving party seeking

to have a patent held not invalid at summary judgment must show that the

nonmoving party, who bears the burden of proof at trial, failed to produce clear

and convincing evidence on an essential element of a defense upon which a

reasonable jury could invalidate the patent.” Id. (emphasis added). As noted, a

preponderance standard applies to patent exhaustion. See Fuji Photo, 474 F.3d at

1293.

This Court reviews “the grant of summary judgment under the law of the

regional circuit in which the district court sits.” Keurig, 732 F.3d at 1372. In the

Sixth Circuit, “the moving party has the burden of proving that no genuine issue as

to any material fact exists and that it is entitled to judgment as a matter of law.”

Leary v. Daeschner, 349 F.3d 888, 897 (6th Cir. 2003). A “dispute over a material

19
fact cannot be ‘genuine’ unless a reasonable jury could return a verdict for the

nonmoving party.” Id. The Sixth Circuit reviews the grant of summary judgment

de novo. See id. at 896. In “reviewing the district court’s decision to grant

summary judgment,” the Sixth Circuit “view[s] all evidence and draw[s] all

reasonable inferences in the light most favorable to the nonmoving party.” Id. at

897. This Court, however, has stated that it reviews a district court’s ruling on

summary judgment with respect to the issue of functionality “for clear error.”

Ethicon, 796 F.3d at 1328, 1332.

II. ABPA’S INVALIDITY ARGUMENT IS MERITLESS.


This case is not just about the F-150 hood or headlamp. That is clear from

ABPA’s opening brief: ABPA does not discuss the specific designs claimed in the

hood or headlamp patents, or argue that any particular aspect of those designs is

unpatentable. Instead, ABPA challenges the validity of design patents on

automotive components in general. See Appx93 (“ABPA’s arguments are not

specific to [the] two patents. Instead, the ABPA argues that designs for auto-body

parts are simply not eligible for patent protection.”). But both this Court and the

Supreme Court have repeatedly held that component parts may be protected

through design patents, and automotive components are no different. See, e.g.,

Samsung, 137 S. Ct. at 435 (design patent on cell phone component); In re Zahn,

617 F.2d 261, 268 (C.C.P.A. 1980) (design patent on drill component). At a

minimum, however, ABPA has failed to meet its burden to produce clear and

20
convincing evidence establishing that the hood and headlamp patents are invalid.

This Court’s precedent demonstrates just the opposite.

A. The Hood And Headlamp Designs In The ’299 and ’685 Patents
Meet The Patentability Requirements Of Section 171(a).
Congress has provided that “[w]hoever invents any new, original and

ornamental design for an article of manufacture may obtain a patent therefor.” 35

U.S.C. § 171(a). An “article of manufacture” includes “both a product sold to a

consumer and a component of that product.” Samsung, 137 S. Ct. at 434.

Consistent with longstanding practice of the Patent and Trademark Office—dating

back to at least 1898—as well as this Court’s precedent, an inventor may

accordingly obtain a design patent on a component of a product as long as the

design is new, original, and ornamental. See id. at 435 (citing Ex parte Adams, 84

Off. Gaz. Pat. Office 311 (1898); Zahn, 617 F.2d at 268).

ABPA has not contested the novelty or originality of the hood and headlamp

designs in the ’299 and ’685 patents. See ABPA Br. 19-39. Nor could it:

Undisputed record evidence demonstrates that those designs were created for the

F-150 truck by highly acclaimed artists. See supra pp.5-7. Those artists attended

the College for Creative Studies, a well-known art and design school with an

automotive design program. See Appx2538. And they designed the F-150

components from scratch, beginning with a sketch, then drafting the design on a

computer, and then modeling the design in clay. See Appx3267-3269. Throughout

21
that process, the artists considered and discarded hundreds of designs before

making a final choice. See id. The appearance of the F-150 components was

driven by aesthetic considerations, and controlled by Ford’s artistic staff. See

Appx2538. There is no question that the hood and headlamp designs meet both the

“new” and “original” criteria of Section 171(a).

This same evidence also demonstrates that the hood and headlamp designs

are ornamental. A design is functional rather than ornamental if it is “dictated by

the use or purpose of the article.” Ethicon, 796 F.3d at 1328 (internal quotation

marks omitted). The relevant inquiry is not whether the design serves a function,

but whether the design was “dictated by function alone.” Best Lock Corp. v. Ilco

Unican Corp., 94 F.3d 1563, 1566 (Fed. Cir. 1996) (emphasis added; internal

quotation marks omitted). To put it another way, a design is ornamental unless the

claimed design is “the only possible form of the article that could perform its

function.” Rosco, 304 F.3d at 1378 (emphasis added; internal quotation marks

omitted).

For that reason, “the availability of alternative designs” is “an important—if

not dispositive—factor in evaluating the legal functionality of a claimed design.”

Ethicon, 796 F.3d at 1329-30. Alternative designs exist here. The ’299 and ’685

patents claim merely one way to design a hood or headlamp that will fit on an F-

150 truck and illuminate the road or cover the engine. Consumers may purchase

22
performance parts for both the hood and headlamp that utilize a different design

but function in the same way as the ’299 and ’685 patents:

F-150 Headlamp F-150 Headlamp


’685 patent, Fig. 2 Performance Part

F-150 Hood F-150 Hood


’299 patent, Fig. 1 Performance Part

See Appx110. ABPA does not dispute—and in fact admitted—that performance

parts are available for both the F-150 hood and headlamp. See Appx1340. The

existence of these performance parts conclusively demonstrates that the designs in

the ’299 and ’685 patents are ornamental rather than functional.

23
Other factors this Court has identified that “might be relevant” to assessing

functionality include:

whether the protected design represents the best design;


whether alternative designs would adversely affect the utility of
the specified article; whether there are any concomitant utility
patents; whether the advertising touts particular features of the
design as having specific utility; and whether there are any
elements in the design or an overall appearance clearly not
dictated by function.

Ethicon, 796 F.3d at 1330 (internal quotation marks omitted). ABPA points to no

evidence that any of these factors suggest a lack of ornamentality. Nor has ABPA

pointed to any specific aspect of either the hood or headlamp design that it claims

is directed to the use or purpose of those components. And no such evidence is

present in the record: ABPA’s challenge in this case is to design patents on

automotive components in general, rather than to the patents on the hood and

headlamp in particular. The record leaves no room for debate over whether the

hood and headlamp designs in the ’299 and ’685 patents are functional instead of

ornamental. They are not. The District Court properly entered judgment in Ford

Global’s favor.

B. ABPA’s Invalidity Arguments Are Unsupported By Precedent


And Contrary To Principles Of Design Patent Law.
ABPA does not argue that the hood and headlamp patents are invalid

because the designs for the hood and headlamp are “mechanical or ‘utilitarian.’ ”

ABPA Br. 23 (criticizing District Court for considering functionality in these

24
terms); see also Appx1041 (“Mechanical function is not relevant to ABPA’s

functionality argument.”). Instead, ABPA asserts (at 19-24) that the patents are

invalid because customers seek only to match the hood and headlamp with the rest

of the truck, and thus choose replacement parts with the same design as the original

component. At bottom, ABPA’s argument is that because consumers preferred the

ornamental design of the hood and headlamp installed on the truck they

purchased—which is the design in the ’299 and ’685 patents—those designs must

be functional when used in replacement parts. This Court should reject ABPA’s

conflation of ornamentality with functionality.

1. ABPA’s “Mate And Match” Argument Is Plainly Wrong.


ABPA first contends (at 19-22) that the hood and headlamp designs in

the ’299 and ’685 patents are functional because those designs are intended to

“mate and match” with the F-150 truck. ABPA’s “mate and match” theory is

derived entirely from two cases—Best Lock and Static Control Components, Inc. v.

Lexmark Int’l, Inc., 697 F.3d 387 (6th Cir. 2012). Neither case supports ABPA’s

assertion.

In Best Lock, a security company had obtained a design patent on the profile

of a blank key blade, from which keys could be made to open a lock. See 94 F.3d

at 1564. Although different keys could be made from the key blade, only a single

design for the key blade—the design claimed in the patent—would make a key that

opened the lock. See id. at 1566. This Court concluded that the key blade design

25
was functional (and thus ineligible for design patent protection) because “no other

shaped key blade would fit into the corresponding” lock. Id. In Static Control, the

Sixth Circuit similarly concluded that a design for a printer ink cartridge was

functional in part because the cartridge had to be designed a certain way to fit in

the printer. See 697 F.3d at 422.

Best Lock and Static Control are plainly inapplicable here. The hood and

headlamp designs claimed in the ’299 and ’685 patents are not the only designs for

those components that fit on an F-150 truck. As the District Court pointed out, and

ABPA agreed, any number of differently designed hoods and headlamps can be

used on a F-150 truck. See Appx110, Appx1340. Indeed, an entire industry has

sprung up around designing performance parts that replace standard components of

F-150 trucks. See supra pp.7-8.

The District Court reproduced designs for performance parts for the F-150

hood and headlamp in its opinion. See Appx110; see also supra p.23 (illustrating

performance parts). As depicted there, the performance headlamp has a

completely different arrangement of lights, and the performance hood has different

elevations, depressions, and stylized lines, just to name the most obvious

differences between the original and performance parts. Yet both the original and

performance parts “mate and match” with the F-150 truck. In a deposition, ABPA

Board Member and New World executive Joseph Tsai admitted that companies

sold performance parts with a different design that “mate and fit with the original

26
vehicles.” Appx940-941. ABPA’s analogy to Best Lock and Static Control

accordingly fails.

ABPA also reads Best Lock to stand for the proposition that the hood and

headlamp designs in the ’299 and ’685 patents are functional because they were

“designed together with the rest of the F-150 exterior,” and because “the hood,

headlamp, and F-150 . . . are arbitrary designs when considered as a combination.”

ABPA Br. 21. But neither of those suggests that a design is functional. The fact

that one design is made in conjunction with another design does not make either

design functional. And to the extent a design is arbitrary, that suggests it is not

functional. ABPA’s (mis)reading of Best Lock is neither supported by that case,

nor by basic principles of patent law.

ABPA further contends that the specific hood and headlamp designs in

the ’299 and ’685 patents are required to “mate and match” with the F-150 truck

because “the insurance company usually has an obligation under the insurance

policy to pay for repair that restores the damaged vehicle to its pre-loss condition,

i.e., operational safety, function, and appearance.” ABPA Br. 6; see also id. at 19.

But ABPA does not cite any case saying that a design on a component part cannot

be patented because that part may someday need to be replaced, and because an

insurance company may choose to pay only for certain replacement parts. Nor

would that make any sense: A private agreement between third parties cannot

overcome the protections afforded by federal patent law.

27
ABPA has also failed to cite any record evidence that an insurance company

would refuse to pay for a replacement part of equivalent value simply because that

part has a different design than the F-150’s original part. The “expert report”

ABPA cites, see ABPA Br. 6 (citing Appx1090) and ABPA Br. 19 (citing

Appx2223-2224), merely describes generic insurance policy payment obligations,

and when deposed, the witness clarified both that she is not an expert in insurance

contracts and that auto-body repair shops simply charge the difference or give a

refund when an owner selects a replacement part with a different value than the

insurance company has priced out for a repair, such as a performance part with a

different appearance. Appx1311-1312. Thus, even assuming that insurance

contract payment obligations would be relevant to patent eligibility, ABPA lacks

clear and convincing evidence supporting its position.6

2. The Hood And Headlamp Designs Contain Conscious Design


Choices.
ABPA next contends (at 22-30) that the design for an automotive component

such as a hood or headlamp is not ornamental because the component may

sometimes need to be replaced, and consumers may choose a replacement part with

the same appearance as the original part. According to ABPA, in this situation,

“there are no conscious design choices to be made” because the consumer is

6
ABPA also suggests in passing (at 16-17) that government regulations and
industry standards might require a particular design, but it does not cite any record
evidence on this point (much less any clear and convincing evidence).

28
interested only in returning his or her vehicle to its original “design aesthetic,”

which somehow supposedly makes the design of the component non-ornamental.

ABPA Br. 23. ABPA has invented wholesale this purported functionality test.

To the extent ABPA is arguing that the hood and headlamp designs are

functional because they do not embody any conscious design choices, ABPA is

incorrect. In some cases, it may be obvious that a design has no ornamental

purpose. Thus, in In re Carletti, 328 F.2d 1020 (C.C.P.A. 1964), this Court held

that a rubber gasket was functional in part because “[i]t seems naive in the extreme

to believe that anyone would try to ‘ornament’ the rubber gasket on the under side

of the bung cap for a gasoline drum.” Id. at 1021. Here, however, the hood and

headlamp are prominent features on the exterior of the F-150 vehicle, and Ford

spent millions of dollars employing artists whose job was to create hundreds of

potential designs for these and other features of Ford vehicles so that consumers

will want to purchase them. Appx2430, Appx2516. Performance part makers do

the same thing, creating their own designs for these parts. See supra pp.7-8.

ABPA cannot seriously contend that the hood and headlamp designs embodied in

the ’299 and ’685 patents contain no conscious design choices. To the contrary,

the selected designs were created by artistic employees of Ford to create an

aesthetically appealing appearance desired by customers. See supra pp.5-7.

ABPA lacks any record evidence (much less clear and convincing evidence)

contradicting that basic point, which is dispositive here.

29
To the extent ABPA’s position is that the hood and headlamp designs in the

’299 and ’685 patents are functional because some consumers do not consider

alternative designs when purchasing replacement parts after a collision, ABPA’s

argument boils down to this: Because consumers liked the way a component such

as a hood or headlamp looked when they bought the vehicle, consumers will

choose a replacement part with the same design if an accident damages the original

part. That is the opposite of failing to make a conscious design choice. Even

under ABPA’s made-up test for functionality, the hood and headlamp designs are

ornamental.

3. ABPA’s Contention That The Designs Of The Hood And Headlamp


Are Not A Matter Of Concern Is Contrary To Precedent.

In a related vein, ABPA asserts that design patents on automotive

components are invalid because the design of such components is not a “matter of

concern.” ABPA Br. 30-36. This Court has explained that a design is not a matter

of concern—and thus not a proper subject for a design patent—when the article is

“concealed or obscure.” In re Webb, 916 F.2d 1553, 1557 (Fed. Cir. 1990)

(internal quotation marks omitted). And it has clarified that even concealed or

obscure articles may still be entitled to design patent protection when “at some

point in the life of the article an occasion (or occasions) arises when the

appearance of the article becomes a ‘matter of concern.’ ” Id.

30
ABPA’s not-a-matter-of-concern argument fails for the straightforward

reason that the F-150’s hood and headlamp are not hidden from view. That makes

them distinctly unlike a vent tube placed inside the wall of a house or a brush

located inside a vacuum cleaner. See, e.g., In re Cornwall, 230 F.2d 457, 459

(C.C.P.A. 1956) (vent tube not a matter of concern because it is not “exposed to

view”); In re Stevens, 173 F.2d 1015, 1019 (C.C.P.A. 1949) (vacuum cleaner brush

not a matter of concern because it is “hidden in normal use”). When considered in

light of the relevant legal question—the “nature of [the] visibility” of the article,

Webb, 916 F.2d at 1558—there is no doubt that the “matter of concern” test simply

does not apply to the F-150’s hood and headlamp.7

But the problems with ABPA’s arguments do not end there. Even if the

matter-of-concern test did apply here, it would be satisfied. This Court has held

that a design is a matter of concern as long as the appearance of the article is a

matter of concern at some point in the article’s life. See Webb, 916 F.2d at 1557.

That is true even for an article that may be ordered solely by parts number. See id.

at 1558. An article’s life begins “after completion of manufacture or assembly,”

and ends “with the ultimate destruction, loss, or disappearance of the article.” Id.

7
The Sixth Circuit appears to take a broader view of the “matter of concern”
test, and apply it in cases where an article is “generally hidden from view,” rather
than always hidden from view. Static Control, 697 F.3d at 422. Even if that were
the rule in this Court, the hood and the headlamp are not generally hidden from
view.

31
Thus, in the case of an artificial femur, the design of the femur is a matter of

concern because it is displayed in advertisements—which appeal to doctors who

select the femur—even if the femur is ultimately hidden from view in the human

body. See id.

The appearance of automotive components such as the hood and headlamp is

a matter of concern, at a minimum, when a consumer purchases a vehicle.

Although ABPA asserts (at 33-34) that consumers are interested only in the overall

design of the vehicle, and not the design of any particular component, ABPA does

not cite any record evidence (much less clear and convincing evidence) for that

point. See ABPA Br. 33-34. Nor does ABPA explain why the design of a

component—such as the hood or headlamp—does not contribute to the overall

appearance of the vehicle, and thus qualify as a matter of concern. See id. And in

any event, ABPA concedes that consumers are concerned that the hood and

headlamp designs “are aesthetically compatible with the F-150’s overall

appearance,” undercutting its own position that those designs are irrelevant to

consumers. Id.

ABPA argues that Webb does not mean what it says, because if “Webb is

strictly applied to the fact patterns in Best Lock and Static Control, the outcomes

may not have been the same.” ABPA Br. 35. According to ABPA, a “Webb type

argument could be made that in Best Lock an advertisement displaying the unusual

key blade design profile might be better noticed by a prospective purchaser, and in

32
Static Control a printer cartridge displaying a sleek or elegant profile might also be

better noticed by a prospective purchaser.” Id. But that misses the point: The

patents at issue in Best Lock and Static Control were functional because no other

design would work; the key blade had to fit the lock, and the cartridge had to fit the

printer. The fact that the blade or the cartridge may have been aesthetically

pleasing was beside the point. Here, the opposite is true: Any number of

replacement parts for the hood or headlamp would fit the F-150 truck.

4. The Trademark Law Concept of “Aesthetic Functionality” Has No


Relevance To Whether A Design Is Ornamental Under The Design
Patent Statute.

ABPA appears to recognize that its functionality arguments fail as a matter

of design patent law. See ABPA Br. 29 (requesting that this Court “change long

standing precedent in the design patent area” in order to accommodate ABPA’s

position). Because ABPA cannot win under design patent law, it asks this Court to

limit designs eligible for patent protection by applying trademark law’s “aesthetic

functionality” doctrine. See id. at 28. But as ABPA recognizes, “no court yet has

applied aesthetic functionality to design patent law despite that both trademarks

and design patents have coexisted for well over a century.” Id. at 28-29 (internal

quotation marks omitted). This Court should not be the first.

Under the aesthetic functionality doctrine, trademark protection is

unavailable where the “aesthetic value” of the design confers “a significant benefit

that cannot practically be duplicated by the use of alternative designs” and granting

33
trademark protection “would significantly hinder competition.” Qualitex Co. v.

Jacobson Prods. Co., 514 U.S. 159, 170 (1995) (internal quotation marks omitted).

Thus, the Southern District of Iowa has held that because farmers want their farm

equipment to match in color, John Deere was not entitled to trade dress protection

in a particular shade of green. See Deere & Co. v. Farmhand, Inc., 560 F. Supp.

85, 98 (S.D. Iowa 1982), aff’d, 721 F.2d 253 (8th Cir. 1983) (per curiam). This

Court has similarly held that because the color black decreases the apparent size of

a boat motor and ensures compatibility with different boat colors, a boat company

was not entitled to trade dress protection in the color black. See Brunswick Corp.

v. British Seagull Ltd., 35 F.3d 1527, 1532 (Fed. Cir. 1994).

Not inhibiting legitimate competition is critical in the trademark context

because trademark rights are potentially permanent; the policy behind granting

perpetual trademark rights is to promote competition by protecting a firm’s

reputation. See id. at 1530-31. Design patents have a different purpose: They

encourage the invention of new ornamental designs by offering a “limited

monopoly” on those designs. In re Eppinger, 94 F.2d 401, 402 (C.C.P.A. 1938).

Design patents, unlike trademark protection, thus are intended to inhibit

competition for a period of time. That is an expected part of the patent law

34
bargain, not a reason to deny design patent protection.8

ABPA seems to recognize that the test for aesthetic functionality that applies

in trademark cases does not work for design patents. ABPA thus asserts that “the

ultimate question is not whether competition is adversely affected, but rather

whether there is a conscious design choice being made that promotes the

decorative arts.” ABPA Br. 25. If that is the case, however, ABPA is not even

asking the Court to apply the aesthetic functionality doctrine from trademark law.

It is instead asking the Court to make up a brand new standard for judging the

ornamentality of design patents, or at least design patents of automotive

components. This Court need not follow ABPA down a new legal path. ABPA

has conceded that it is not arguing that the ’299 or ’685 patents have mechanical or

utilitarian functionality. See ABPA Br. 23; Appx1041. This Court should

accordingly affirm the District Court’s functionality ruling on that basis.

5. The Validity Of A Patent Does Not Depend On The Market.

As a fallback-fallback position, ABPA asks this Court to coin yet another

new test—one that will separately consider the validity of Ford Global’s design

patents with respect to the “initial sales” market and the “repair” market.

According to ABPA, even if the ’299 and ’685 patents are valid design patents

8
Trademark law’s aesthetic functionality doctrine is also a mismatch for the
design patent context, because Ford Global’s patents are distinctly unlike a claim
for a color that may be applied to many different articles made in many different
ways. Ford Global claims a single design for a hood and headlamp.

35
when an F-150 is first purchased, those patents lose their validity when it comes to

assessing replacement parts. See ABPA Br. 36-38. ABPA does not cite a single

case holding that a design patent’s validity depends on—and varies with—the

market in which the product is sold. Instead, ABPA once again attempts to import

principles of trademark law into design patent law—and once again, this Court

should decline to do so.

ABPA asserts that just as “[f]ocusing on the particular market served is

appropriate in trademark law because the emphasis is on consumer confusion,”

“focusing on the particular market served also is appropriate in design patent law

because the matter of concern inquiry relates to the concerns of the purchaser.”

ABPA Br. 37. That argument makes no sense. Trademark law evaluates the

particular market in which an article is sold in order to determine whether

consumers are likely to be confused about the origin of the product. See, e.g.,

Citigroup Inc. v. Capital City Bank Grp., Inc., 637 F.3d 1344, 1354 (Fed. Cir.

2011). No such concerns are present in patent law. And this Court has made clear

that if a design is a matter of concern at any point in an article’s life, that design is

patentable. See Webb, 916 F.2d at 1557. This Court should reject ABPA’s

contorted analogy to trademark law, and affirm the District Court’s ruling granting

judgment to Ford Global.

36
III. THE EXHAUSTION DOCTRINE DOES NOT EXCUSE BLATANT
COPYING OF PATENTED DESIGNS BY ABPA’S MEMBERS.
ABPA asserts that once a Ford dealer has sold an F-150 truck to a consumer,

Ford Global’s patents covering the hood and headlamp design used on that truck

are exhausted such that the truck purchaser can buy as many new components as it

wants without regard to Ford Global’s patent rights. But that is not how

exhaustion works. Under the exhaustion doctrine, the sale of a patented article

exhausts the patentee’s rights as to that article. See Jazz Photo, 264 F.3d at 1105.

It has long been established that the doctrine does not permit the purchaser to

infringe a patent by making (or buying) new copies of a patented component and

claiming the new copies are “repairing” the original article. See Aiken, 2 Cliff. 435;

see also Morgan Envelope, 152 U.S. at 435 (adopting Aiken). Thus, the sale of an

F-150 truck may exhaust design patents that cover the specific hood and headlamp

components installed on that truck, but it does not permit the truck owner to make

(or buy) a completely new hood or headlamp covered by Ford Global’s patents as

though those patents do not exist. See id. The District Court properly applied

these well-established principles to this case, and its ruling should be upheld.

A. 150-Year-Old Precedent Establishes That The Right To Repair


Does Not Extend To Separately Patented Repair Parts.
The question presented by ABPA was decided long ago. In 1865, a New

Hampshire court addressed whether the defendant could replace worn-out needles

on a sewing machine, when the sewing machine and its accompanying needles

37
were both patented. See Aiken, 2 Cliff. 435. The court concluded that the answer

was no. See id. As the court explained, “[t]he indubitable right of the defendants

is to repair or improve the articles as long as they will last, but they cannot make

new ones, nor can they, in the exercise of their right to repair the old ones, infringe

another man’s patent.” Id. at 437. Because the sewing machine needles were

separately patented, the court held that creating replacements for them violated that

separate patent. See id.

In 1894, the Supreme Court adopted Aiken’s reasoning in Morgan Envelope.

Two patents were at issue in Morgan Envelope: A patent on a toilet paper roll and

a patent on the same toilet paper roll combined with a toilet paper holder. See 152

U.S. at 427, 430. The Supreme Court held that the toilet paper roll patent was

invalid (as obvious), but that the combination was patentable. See id. at 429-431.

The Supreme Court then analyzed whether the patent on the combination

prevented another company from manufacturing replacement toilet paper rolls.

See id. at 431-433. The answer to that question was no—but only because the

toilet paper roll was not patent-eligible. See id. at 433-435.

The Supreme Court explained its ruling in Morgan Envelope by comparing

Aiken to Wilson v. Simpson, 50 U.S. (9 How.) 109 (1850). In Aiken, the Supreme

Court stated, the sewing machine’s replacement “needles were the subject of a

separate patent.” Morgan Envelope, 152 U.S. at 435. Thus, the purchase of the

sewing machine and its accompanying needles “did not confer upon the purchaser

38
any right, after the needles were worn out and became useless, to manufacture

other needles.” Id. In Wilson, in contrast, the patent holder had obtained a patent

on the combination of a planing machine with cutting knives, but the cutting

knives “were not subject to a patent.” Id. Thus, the purchaser of the planing

machine could replace the cutting knives without violating any patent rights. See

id.

The Supreme Court reaffirmed this distinction in Aro. There, the Supreme

Court examined whether a patent on a convertible top for an automobile—which

claimed the combination of a top fabric, supporting structures, and a sealing

mechanism—prevented a convertible-purchaser from replacing the top fabric. See

365 U.S. at 337-338. The Supreme Court concluded that the purchaser could

replace the fabric because it was “an unpatented element of [the] combination

patent.” Id. at 339-340, 342-343 & n.9 (citing Wilson and Morgan Envelope). The

Supreme Court repeatedly stressed throughout Aro that the fabric top was not

separately patented. See id. at 339 (combination patent is “comprised entirely of

unpatented elements”); id. (fabric is “an unpatented element”); id. (fabric has not

“been patented”); id. at 342 (describing precedents discussing the “replacement of

an unpatented part”); id. at 345 (“No element, not itself separately patented, that

constitutes one of the elements of a combination patent is entitled to patent

monopoly.”).

39
This Court has held that the Supreme Court “approved” the Aiken court’s

treatment of the “circumstance in which the patent owner sold to purchasers two

distinct, separately patentable inventions, even when they are designed to be used

together.” Helferich Patent Licensing, 778 F.3d at 1304. And this Court has

applied Aiken’s reasoning in a recent case. See id. at 1305.

These longstanding precedents decide this case. The exhaustion doctrine

permits the repair of a patented article with an unpatented component. See Aro,

365 U.S. at 339-340. The repair of a patented article with a patented component,

however, is impermissible. See Aiken, 2 Cliff. at 435; see also Morgan Envelope,

152 U.S. at 435. That makes sense: The right to repair a patented article does not

include the right to make (or buy) a new copy of a patented article. See Jazz Photo,

264 F.3d at 1103. As the District Court explained, “[t]he authorized sale of a

patented item permits the owner to sell and use the one item that he purchased—

not to make a replacement should that one item be destroyed.” Appx113 (citing

Bowman, 569 U.S. at 283-84). Thus, although consumers may repair a hood or

headlamp that is damaged, they may not replace the hood or headlamp with a

completely new part. See Jazz Photo, 264 F.3d at 1103. The District Court

properly rejected ABPA’s exhaustion defense and entered judgment in Ford

Global’s favor.

40
B. This Court Should Reject ABPA’s Attempt To Create A New
Exhaustion Regime For Design Patents.
ABPA’s position is foreclosed by longstanding precedent. See, e.g., Morgan

Envelope, 152 U.S. at 435. ABPA thus asks this Court to create a new exhaustion

regime, solely for design patents, that favors ABPA’s position. See ABPA Br. 49

(“ABPA is arguing that established patent exhaustion principles should be applied

to design patents in a way that recognizes the unique nature of design patents and

how the design patent statutory scheme differs from the utility patent statutory

scheme.”). Yet again, this Court should decline ABPA’s request to upend the law.

ABPA’s arguments with respect to exhaustion are difficult to follow.

Recognizing that its position is foreclosed by Aiken, ABPA attempts to distinguish

Aiken on the ground that the patent at issue there was a utility patent rather than a

design patent. See id. at 51. According to ABPA, because a utility patent claims a

“machine,” whereas a design patent claims a “design for an article of manufacture,”

exhaustion works differently with respect to design patents. Id. at 52 (internal

quotation marks omitted).

Here is where ABPA’s position gets confusing: ABPA appears to argue that

when one utility patent claims a combination product and a separate utility patent

claims a component of that product—such as the sewing machine and the sewing

machine needle in Aiken—the patents claim two separate machines. See id. at 53-

54. According to ABPA, that explains why Aiken concluded that the defendant

41
could not manufacture a new copy of a sewing machine needle in order to repair

the sewing machine. See id. at 54. In contrast, ABPA asserts, where a design

patent claims a design for a component of a larger product, such as a headlamp

design for an F-150 truck, the relevant “article” is the larger product, not the

component. See id. Thus, according to ABPA, the right to repair the F-150 truck

permits a consumer to make (or buy) a copy of a patented headlamp component.

See id.

ABPA’s theory is, once again, completely made up. Not only that, it is

contrary to Supreme Court precedent: In Samsung, the Supreme Court held that an

“article” is “simply a thing made by hand or a machine.” 137 S. Ct. at 435. Thus,

“the term ‘article of manufacture’ is broad enough to encompass both a product

sold to a consumer as well as a component of that product.” Id. ABPA’s theory

that the F-150 truck is the relevant “article” (rather than a component such as the

hood or headlamp) is simply incorrect under Samsung. The ITC rejected ABPA’s

theory, see Appx242, the District Court rejected ABPA’s theory, see Appx115, the

New World district court rejected this theory, see Appx173 (Docket Entry 202),

and this Court should too.

C. The Sale Of An F-150 Does Not Grant An Implied License To


Manufacture New Copies Of The Hood And Headlamp.
ABPA’s final contention is that the purchase of an F-150 truck creates an

“implied license” to repair that truck by replacing components such as the hood or

42
headlamp. ABPA Br. 55-56. According to ABPA, because Ford Global does not

tell consumers that they do not have an implied license to replace patented

components of the truck, there is an implied license to do so. See id. at 56-57.

ABPA says that this license arises from the “legal relationship” between the F-150

truck and the design patents on the hood and headlamp components (whatever that

means). Id. at 55.

ABPA has made this argument up too. It does not cite any case saying that

when a patent owner sells a patented article, it grants an implied license to make

(or purchase) new copies of that article anytime the patent owner does not

explicitly disclaim such a license. To the extent ABPA is merely reiterating its

position that the sale of an F-150 truck exhausts Ford Global’s rights in the ’299

and ’685 patents even with respect to new copies of the hood or headlamp, both

this Court and the Supreme Court have rejected that argument. See supra pp.37-40;

see also Hewlett-Packard Co. v. Repeat-O-Type Stencil Mfg. Corp., 123 F.3d 1445,

1451 (Fed. Cir. 1997) (re-creation of a patented article “is an infringement because

such activity is beyond the implied authorization to use and sell a patented device”).

D. As Upstream Manufacturers, ABPA’s Members Are Not Entitled


To Assert Exhaustion As A Defense.
ABPA’s exhaustion argument faces one more unavoidable problem: ABPA

has not established that either ABPA or its members are entitled to assert that

defense. ABPA claims that because the owner of the F-150 “has an implied

43
license to repair the F-150, the owner also has ‘have made’ rights that shields the

manufacture of the repair part and all members of the distribution chain from

liability for patent infringement.” ABPA Br. 44-45. But ABPA does not cite any

case supporting its position, and there are none.

In the case ABPA cites—CoreBrace LLC v. Star Seismic LLC, 566 F.3d

1069 (Fed. Cir. 2009)—this Court held that a party licensed to manufacture a

patented product could, in the circumstances of that case, contract with third

parties “to have the licensed products made for it.” Id. at 1072. Even if the

circumstances that permitted third-party contracting in CoreBrace were present

here (and they are not), it would get ABPA nowhere. ABPA is not contending that

F-150 truck owners contracted with an ABPA member to manufacture a

replacement hood or headlamp. Instead, ABPA’s members manufacture infringing

auto-body parts and then offer them for sale to the public generally in an attempt to

find a market for them.

The fact that a purchaser may have a license to make or purchase a patented

part does not retroactively grant ABPA’s members immunity for making that part

without a license. See Crossroads Sys., 48 F. Supp. 3d at 990-991 (patent

exhaustion applies to “downstream sales,” not “upstream manufacturer[s]”); Glob.

Commc’ns, Inc. v. DirecTV, Inc., 1 F. Supp. 3d 1305, 1307-08 (N.D. Fla. 2014)

(upstream manufacturers may not assert patent exhaustion defense); see also

Appx241 (ITC decision). As the Northern District of California has stated, “[n]o

44
court that this Court is aware of has ever applied the patent exhaustion doctrine to

protect anyone ‘upstream’—e.g., the person/entity’s suppliers.” Asetek Holdings,

Inc. v. CoolIT Sys., Inc., No. C-12-4498 EMC, 2013 WL 5640905, at *2 (N.D. Cal.

Oct. 11, 2013). The affirmative defense of exhaustion is thus unavailable to both

ABPA and its members.9 For this reason as well, the District Court properly

entered judgment in Ford Global’s favor.

9
It bears emphasis that at no point in this suit has ABPA identified any
individuals who have contracted with an ABPA member to manufacture a
replacement hood or headlamp.

45
CONCLUSION

For the foregoing reasons, this Court should affirm the judgment of the

District Court in favor of Ford Global.

Respectfully submitted,

/s/Jessica L. Ellsworth
Marc Lorelli Jessica L. Ellsworth
Frank A. Angileri Katherine B. Wellington
BROOKS KUSHMAN P.C. HOGAN LOVELLS US LLP
1000 Town Center, 22nd Floor 555 Thirteenth Street, N.W.
Southfield, MI 48075 Washington, D.C. 20004
(248) 358-4400 (202) 637-5600

Counsel for Appellee


Ford Global Technologies, LLC

Dated: June 20, 2018

46
CERTIFICATE OF SERVICE

I hereby certify that on this 5th day of July, 2018, I caused a copy of the

foregoing Corrected Brief for Appellee to be served by electronic means via the

Court’s CM/ECF system on all counsel registered to receive electronic notices.

/s/Jessica L. Ellsworth
Jessica L. Ellsworth

Counsel for Appellee


Ford Global Technologies, LLC

Date: July 5, 2018


CERTIFICATE OF COMPLIANCE
1. This brief complies with the type-volume limitations of Federal Rule

of Appellate Procedure 32(a)(7)(B) and Federal Circuit Rule 32(a) because it

contains 10,648 words, excluding the parts of the brief exempted by the rules.

2. This brief complies with the typeface requirements of Federal Rule of

Appellate Procedure 32(a)(5) and the typestyle requirements of Federal Rule of

Appellate Procedure 32(a)(6) because it has been prepared in a proportionally

spaced typeface using Microsoft Office Word 2010 in Times New Roman 14-point

font.

/s/Jessica L. Ellsworth
Jessica L. Ellsworth

Counsel for Appellee


Ford Global Technologies, LLC

Date: June 20, 2018


18-1613
_______________________________________________________________

United States Court of Appeals


for the Federal Circuit
__________________________

AUTOMOTIVE BODY PARTS ASSOCIATION,

Plaintiff-Appellant,
v.

FORD GLOBAL TECHNOLOGIES, LLC.,

Defendant-Appellee,

APPEAL FROM THE UNITED STATES DISTRICT COURT FOR THE


EASTERN DISTRICT OF MICHIGAN IN CASE NO. 2:15-CV-10137
JUDGE LAURIE J. MICHELSON

_____________________________

REPLY BRIEF FOR THE APPELLANT


_____________________________

Robert G. Oake, Jr. Paul M. Kittinger (P72754)


Texas State Bar No. 15154300 CARDELLI LANFEAR, P.C.
Oake Law Office 322 W. Lincoln
700 S. Central Expy., Suite 400 Royal Oak, MI 48067
Allen, Texas 75013 (248) 544-1100
(214) 207-9066, rgo@oake.com pkittinger@cardellilaw.com

Attorneys for ABPA

July 19, 2018


UNITED STATES COURT OF APPEALS FOR THE FEDERAL CIRCUIT

Automotive Body Parts Association v. Ford Global Technologies, LLC


18-1613

CERTIFICATE OF INTEREST

Counsel for Plaintiff-Appellant certifies the following:

1. The full name of every party or amicus represented by me is:

Automotive Body Parts Association

2. The real name of the real party in interest (if the party named in the caption
is not the real party in interest) represented by me is:

None

3. All parent corporations and any publicly held companies that own 10 percent
or more of the stock of the party or amicus curiae represented by me are:

None

4. The names of all law firms and the partners or associates that appeared for
the party or amicus now represented by me in the trial court or agency or are
expected to appear in this court (and who have not or will not enter an appearance
in this case) are:

CARDELLI LANFEAR, P.C., Thomas G. Cardelli

5. Pursuant to Federal Circuit Rule 47.5, Appellant states as follows:

(a) A Petition for Writ of Mandamus was filed previously in this case
titled In re: Automotive Body Parts Association, Petitioner, 2015-156. An order
issued November 17, 2015 denying the petition. The composition of the panel was
Judge Lourie, Judge Dyk, and Judge Hughes, order by Judge Dyk. The order is
nonprecedential and unreported.

i
(b) The title and number of any case known to counsel to be pending in
this or any other court that will directly affect or be directly affected by this court’s
decision in the pending appeal:

(1) New World International, Inc., and National Auto Parts, Inc., v. Ford
Global Technologies, LLC and Ford Motor Company; 17-1956, (mandate issued,
time for filing petition for writ of certiorari to United States Supreme Court not yet
expired).

(2) Ford Global Technologies, LLC v. New World International, Inc., et al.,
case number 3:17-cv-03201, pending in the United States District Court for the
Northern District of Texas.

July 19, 2018 /s/ Robert G. Oake, Jr.


Robert G. Oake, Jr.
Attorney for Plaintiff-Appellant

ii
TABLE OF CONTENTS
Page

TABLE OF AUTHORITIES …………………………………… v

ARGUMENT ………………………………………………… 1

I. Reply to FGTL’s Response Argument on Invalidity due to


Lack of Ornamentality …………………………………… 1

A. The Hood and Headlamp Designs in the ‘299 and


‘685 Patents Do Not Meet the Ornamental
Requirement of Section 171(a) ……………………… 4

B. ABPA’s Invalidity Arguments are Supported by


Precedent and are Consistent with Principles of
Design Patent Law …………………………….. 4

1. ABPA’s “Mate and Match” Argument is Correct …… 4

2. The Hood and Headlamp Designs Do Not Contain


Conscious Design Choices ……………………… 9

3. The Individual Designs of the Hood and Headlamp


are not a Matter of Concern ……………………… 11

4. Aesthetic Functionality is Relevant to Whether a


Design is Ornamental …………………………….. 12

5. Consideration of the Market when determining


Enforceability ……………………………………. 15

II. The Patent Exhaustion Doctrine Applies in this Case …. 16

A. FGTL’s 150-Year-Old Precedent Applies to Utility


Patent Cases but Not Design Patent Cases ………… 17

B. This Court should accept ABPA’s Analysis that


Applies Established Patent Exhaustion Principles to
Design Patents ……………………………………. 18

iii
C. The Sale of an F-150 Grants an Implied License to
Repair the F-150 …………………………………… 27

D. ABPA Members are entitled to assert Exhaustion


and Implied License as a Defense ………………. 28

CONCLUSION AND RELIEF SOUGHT ……………………… 29

CERTIFICATE OF COMPLIANCE …………………………….. 30

CERTIFICATE OF SERVICE

iv
TABLE OF AUTHORITIES

CASES Page(s)

Aiken v. Manchester Print Works,


2 Cliff. 435 (1865) ……………………………………. 17

Apple, Inc. v. Samsung Electronics Co. Ltd,


Case No. 11-cv-01846 (N.D. Cal. October 22, 2017)… 21

Asetek Holdings, Inc. v. CoolIT Sys., Inc.,


No. C-12-4498 EMC, 2013 WL 5640905
(N.D. Cal. Oct. 11, 2013) ……………………………... 28

Avia Group International Inc. v. L. A. Gear California Inc.,


853 F.2d 1557 (Fed. Cir. 1988) ……………………… 13

Best Lock Corp. v. Ilco Unican Corp.,


94 F.3d 1563 (Fed Cir. 1996) ……………………… Passim

Carborundum Co. v. Molten Metal Equip. Innovs.,


72 F.3d 872 (Fed. Cir. 1995) ……………………… 26

Crossroads Sys., Inc. v. Dot Hill Sys. Corp.,


48 F. Supp. 3d 984 (W.D. Tex. 2014) ………………. 28

Egyptian Goddess, Inc. v. Swisa, Inc.,


543 F.3d 665 (Fed. Cir. 2008) (en banc) ………… 13

Ethicon Endo-Surgery, Inc. v. Covidien, Inc.,


796 F.3d 1312 (Fed. Cir. 2015) ……………………… 1

Ex parte Adams,
84 Off. Gaz. Pat. Office 311 (1898) ………………. 3

Glob. Commc’ns, Inc. v. DirecTV, Inc.,


1 F. Supp. 3d 1305 (N.D. Fla. 2014) ………………. 28

Gorham v. White,
81 U.S. 511 (1871)…………………………………… 3

v
Hewlett-Packard Co. v. Repeat-O-Type Stencil Mfg. Corp.,
123 F.3d 1445 (Fed. Cir. 1997) ……………………… 28

Impression Prods., Inc. v. Lexmark Int'l, Inc.,


137 S. Ct. 1523 (2017) …………………………….. 23

In re Carletti,
328 F.2d 1020 (C.C.P.A. 1964) ……………………… 10, 12

In re Webb,
916 F.2d 1553 (Fed. Cir. 1990) ……………………… 11, 12, 16

In re Zahn,
617 F.2d 261 (C.C.P.A. 1980) ……………………… 3

Jazz Photo Corp. v. Int’l Trade Comm.,


264 F.3d 1094 (Fed. Cir. 2001) ……………………… 17

Kendall Co. v. Progressive Medical Technology, Inc.,


85 F.3d 1570 (Fed. Cir. 1996) ……………………… 28

Morgan Envelope Co. v. Albany Perforated Wrapping


Paper Co.,152 U.S. 425 (1894) ……………………… 17

Powertech Technology Inc. v. Tessera, Inc.,


660 F.3d 1301 (Fed. Cir. 2011) ……………………… 27

Quanta Computer Inc. v. LG Electronics, Inc.,


553 U.S. 617 (2008) …………………………….. 16, 18, 20, 21, 23

Samsung Elecs. Co. v. Apple Inc.,


137 S. Ct. 429 (2016) …………………………….. 3, 19

Static Control Components v. Lexmark International,


697 F.3d 387 (6th Cir. 2012) ……………………… 1, 4, 8, 9, 10

STATUTES

35 U.S.C. § 171 ………………………………………….. 6, 8

vi
35 U.S.C. § 171(a) …………………………………………… 4

35 U.S.C. § 289 …………………………………………… 21, 22, 25, 26

SECONDARY AUTHORITY

MPEP 1504.01(c) …………………………………………… 12

OTHER

Brief for the United States as Amicus Curiae Supporting


Neither Party, 2016 U.S. S. Ct. Briefs LEXIS 2322
(June 8, 2016) …………………………………….. 25

vii
ARGUMENT

I. Reply to FGTL’s Response Argument on Invalidity due to Lack of


Ornamentality

Ford Global Technology LLC’s (FGTL) response argument is essentially that

since alternative hood and headlamp designs can fit the F-150, FGTL’s design

patents are ornamental. FGTL Br. 22-23. This argument takes a far too limited and

improper view of what makes a design non-ornamental and unpatentable. In Ethicon

Endo-Surgery, Inc. v. Covidien, Inc., 796 F.3d 1312 (Fed. Cir. 2015), this Court

stated "an inquiry into whether a claimed design is primarily functional should begin

with an inquiry into the existence of alternative designs," id. at 1330 (emphasis

added), but reaffirmed it has "not mandated applying any particular test for

determining whether a claimed design is dictated by its function and therefore

impermissibly functional." Id. at 1329.

In ABPA’s opening brief, ABPA explained that the case law, including Best

Lock Corp. v. Ilco Unican Corp., 94 F.3d 1563 (Fed Cir. 1996) and Static Control

Components v. Lexmark International, 697 F.3d 387 (6th Cir. 2012) has developed

additional factors to consider when determining whether a design is functional,

including: (1) when the claimed design of the article of manufacture (or portion

thereof) is designed to fit into or onto a parent article of manufacture; (2) when the

article of manufacture typically is sold with the parent and will need replacing during

the useful life of the parent article due to foreseeable damage, use, or loss of the

1
article of manufacture or parent; (3) when the design of the article of manufacture is

dictated by its need to mate with and match the appearance of the parent due to

functional necessity or other requirements such as insurance policy requirements;

(4) when the appearance of the design has no other role in the purchaser's decision

other than to be compatible with another article of manufacture; and (5) when

customers typically can purchase the repair/replacement article of manufacture by

part number rather than by the appearance of the article of manufacture. ABPA Br.

17-18.

ABPA further pointed out that when evaluating the functionality of a design

in a mate and match context, “the focus is not on potential alternative designs that

might be created during the design process, but rather on the practical mate and

match compatibility after the designs are created….” ABPA Br. 18.

FGTL’s response brief largely ignores these important functionality factors in

its analysis and instead focuses erroneously on whether alternative hood and

headlamp designs are available that will fit the F-150. When all the appropriate

functionality factors and analysis are considered, this Court should find that the

subject designs are functional and invalid.

FGTL begins its response argument with a misconception. FGTL argues

ABPA is challenging the validity of design patents on automotive components in

general. FGTL Br. 20. That is incorrect. ABPA is challenging the validity of the

2
subject design patents to obtain an opinion from this Court that potentially can be

used to challenge patents on designs that meet the criteria described above (or as

described in this Court’s opinion).

FGTL argues that both this Court and the Supreme Court “have repeatedly

held that component parts may be protected through design patents, and automotive

components are no different. See, e.g., Samsung, 137 S. Ct. at 435 (design patent on

cell phone component); In re Zahn, 617 F.2d 261, 268 (C.C.P.A. 1980) (design

patent on drill component).” FGTL Br. 20. But the component parts addressed in

these cases clearly are different from the automotive repair parts addressed in this

case. In re Zahn involved a portion of an integrated drill bit and Samsung involved

design patents on the front face and grid of icons of a smart phone. There was no

evidence that these components typically were damaged in normal use and that a

repair/replacement market had arisen.1 Similarly, in another case cited by FGTL,

Gorham v. White, 81 U.S. 511 (1871), the silverware handles were integrated with

the remainder of the fork and spoon and there was no evidence of a

repair/replacement market for the silverware handles.

1
FGTL also cites Ex parte Adams, 84 Off. Gaz. Pat. Office 311 (1898). FGTL Br.
21. Ex parte Adams involved rejection of an application for “Design for Truck Side
Frames” for having movable parts. The opinion states the “movable parts may each
separately be patented as a design; but the machine itself cannot be so patented….”

3
Rather, in each of these cases, defendants were attempting to sell articles that

included the accused design (drill bit, smart phone, silverware), but were not

attempting to sell a repair/replacement component part that included the accused

design. These cases are to be distinguished from cases such as Best Lock and Static

Control where defendants were attempting to sell a repair/replacement component

part that included the accused design (replacement key blade and printer cartridge).

A. The Hood and Headlamp Designs in the ‘299 and ‘685 Patents Do
Not Meet the Ornamental Requirement of Section 171(a).

35 U.S.C. § 171(a) states in relevant part “[w]hoever invents any new, original

and ornamental design for an article of manufacture may obtain a patent therefor….”

FGTL is correct that in this action ABPA is not challenging the novelty or originality

of the hood and headlamp designs in the USD 489,299 (“the ‘299 Patent”) and the

USD 501,685 (“the ‘685 Patent”). The effort FGTL spends on these two issues is

not relevant.

B. ABPA’s Invalidity Arguments are Supported by Precedent and


are Consistent with Principles of Design Patent Law.

1. ABPA’s “Mate and Match” Argument is Correct

FGTL argues that ABPA has misread and misapplied Best Lock, but it is

FGTL that fails to understand the significance of this Court’s legal analysis in the

Best Lock case. According to FGTL, in Best Lock “[t]his Court concluded that the

key blade design was functional (and thus ineligible for design patent protection)

4
because ‘no other shaped key blade would fit into the corresponding’ lock.” FGTL

Br. 25-26. (citing Best Lock at 1566). FGTL argues Best Lock is inapplicable

because “[t]he hood and headlamp designs claimed in the ’299 and ’685 patents are

not the only designs for those components that fit on an F-150 truck.” FGTL Br. 26.

FGTL reads Best Lock too narrowly.

To briefly review, in Best Lock, a design patent covered a portion of a key

blade that inserts into a keyway. The district court found the design patent invalid

because it lacked ornamentality. On appeal, the plaintiff argued that that since “an

unlimited number of key blade and corresponding keyway designs are available,”

the design claimed for the key blade is ornamental because it “is not dictated solely

by functional concerns.” 94 F.3d at 1566. This Court rejected plaintiff’s argument,

and this Court’s analysis and rationale for the rejection is the true significance of

Best Lock.

This Court first acknowledged that “different interfaces between key blades

and corresponding lock keyways can be designed to permit the combination to

function as a lock and key set.” Id. at 1566. “However,” this Court continued, “Best

Lock's patent does not claim the combination of a lock and corresponding key.

Instead, the claim in the '636 design patent is limited to a key blade, which must be

designed as shown in the '636 patent in order to perform its intended function.” Id.

ABPA explained the significance of this in its opening brief: “this Court’s analysis

5
did not focus on alternative designs that might be created during the design process

for the interface between the key blade and keyway, but rather focused on the

practical mate and match compatibility issues after the designs were created.”

ABPA Br. 20.

Since the focus is on compatibility after the original designs are created, there

is no reason that compatibility need be limited to whether the designs fit together

mechanically. Rather, compatibility also includes whether the designs fit together

aesthetically, because in the automotive part repair/replacement context, appearance

compatibility is just as much a factor in compatibility as mechanical compatibility.

Indeed, the only reason the particular part is being purchased is to return the F-150

back to its pre-damaged appearance. Just as a particular appearance of the key blade

was needed to be compatible with the keyway in Best Lock, a particular appearance

of the hood or headlamp is needed to be compatible with the F-150.

FGTL argues Best Lock is not applicable because it was mechanical fit that

was important and not the appearance of the key blade. FGTL’s argument focuses

incorrectly on mechanical functionality and not lack of ornamentality. The design

patent statute, 35 U.S.C. § 171, requires that the design be ornamental, not that it be

“mechanically non-functional.” The concept of mechanical functionality has arisen

simply because one of the tests for determining ornamentality is whether a design is

dictated by function. But the true test of ornamentality is whether it involves a

6
conscious design choice. When ornamentality is thought of this way and is

combined with the Best Lock analysis, it can be seen that appearance compatibility

is just as relevant as mechanical compatibility.

FGTL’s response indicates that FGTL misreads ABPA’s brief, the evidence,

and the Best Lock case. FGTL first mentions the performance parts referred to in

the District Court opinion and states the performance parts look different than the

original parts. FGTL then states “[y]et both the original and performance parts

“mate and match” with the F-150 truck.” FGTL Br. 26. That is incorrect. Although

the performance parts may “mate” with the F-150, they clearly do not “match” the

original appearance of the F-150. Indeed, in the deposition testimony of Joseph Tsai

quoted by FGTL at FGTL Br. 26-27, Mr. Tsai never states that the performance parts

“match” the appearance of the F-150. Rather, Mr. Tsai testifies that the performance

parts “mate and fit with the original vehicles” Appx940-941 (emphasis added),

which is quite a different thing than mating and matching with the original vehicles.

Referring to Best Lock, FGTL states “ABPA also reads Best Lock to stand for

the proposition that the hood and headlamp designs in the ’299 and ’685 patents are

functional because they were ‘designed together with the rest of the F-150 exterior,’

and because ‘the hood, headlamp, and F-150 . . . are arbitrary designs when

considered as a combination.’” FGTL Br. 27. FGTL then states “[b]ut neither of

those suggests that a design is functional” and “[t]he fact that one design is made in

7
conjunction with another design does not make either design functional.” FGTL Br.

27. FGTL’s conclusion is contrary to the majority holding in Best Lock. Indeed,

FGTL’s reasoning and conclusion are the same as the reasoning and conclusion in

the dissent in Best Lock rejected by the majority.

In the Best Lock dissent, Judge Newman states “[i]n holding that because the

key must fit a keyway, the abstract design of the key profile is converted to one

solely of function, the court creates an exception to design patent subject matter”

and “[a]n arbitrary design of a useful article is not statutorily excluded from § 171

simply because in use it interacts with an article of complementary design.” 94 F.3d

at 1569. This is the argument made by FGTL referenced above that was rejected by

the majority in Best Lock. The important point is that because the key blade and

keyway were designed together and had to be compatible in use, this Court found

the design patent on the key blade invalid as functional.

This Court’s rationale in Best Lock indicates that when evaluating the

functionality of a design in a mate and match and repair/replacement context, the

focus is not on potential alternative designs that might be created during the design

process, but rather on the practical mate and match compatibility after the designs

are created. This type of analysis also was followed in Static Control, supra, where

the Sixth Circuit found invalid as functional a design patent on a printer replacement

toner cartridge where, inter alia, (1) the toner cartridge design was dictated solely

8
by the printer with which it was compatible and (2) customers selected replacement

toner cartridges based solely on whether the cartridge was compatible with the

printer they owned.

Although FGTL wants to focus the attention on the design process that occurs

when the F-150 originally is being designed, that is not the proper focus in the mate

and match and repair/replacement context under Best Lock and Static Control.

2. The Hood and Headlamp Designs Do Not Contain Conscious


Design Choices

FGTL states “ABPA has invented wholesale this purported functionality test”

that the subject designs are not ornamental because they do not contain any

conscious design choices. FGTL Br. 29. FGTL is incorrect because ABPA’s

argument is derived from this Court’s rationale in Best Lock that the focus is on

design compatibility after the designs are created.

When it is understood that the proper focus is on design compatibility after

the designs are created, it is understandable why the designs do not contain any

conscious design choices. The only conscious design choices occur while the

designs are being created. If the design creation process was the time that was

relevant, then the key blade in Best Lock and the printer cartridge in Static Control

would have been eligible for design patent protection because the original designs

and design interfaces were arbitrary. However, this Court and the Sixth Circuit, in

the mate and match and repair/replacement context, focus solely on the compatibility

9
of designs after they were created and how a consumer would select a replacement

design.

FGTL cites the gasket design in In re Carletti, 328 F.2d 1020 (C.C.P.A. 1964)

as an example of a design that lacks ornamentality. FGTL Br. 29. FGTL then tries

to distinguish the subject designs, stating “Ford spent millions of dollars employing

artists whose job was to create hundreds of potential designs for these and other

features of Ford vehicles so that consumers will want to purchase them.” FGTL Br.

29. The problem with FGTL’s argument is that it is focuses on the wrong period of

time. The designers in Best Lock and Static Control also no doubt spent a substantial

amount of time designing the products at issue. But the problem was that the designs

were created to be compatible with another design, and in the mate and match and

repair/replacement context, the proper focus is not when designs originally are

created, but later when compatibility and replacement are important.

FGTL next argues that because a consumer post collision can replace a hood

or headlamp with a performance part that does not look like the original, the

consumer is making a conscious design choice to choose the original design. This

argument is surprising given that FGTL states Ford spends millions of dollars

designing the F-150. Given the effort Ford puts into the design, it is understandable

that an owner will want to return the vehicle back to original appearance, and a return

to original appearance does not involve a conscious design choice by the designer.

10
Indeed, returning a vehicle back to original appearance is no less important than

having a lock that works or a printer cartridge that fits. A replacement key blade or

replacement toner cartridge can be bought with a different design, but they will not

work. Likewise, a performance hood or headlamp can be bought, but it will not

work to return the F-150 back to original appearance. Finally, the typical insurance

policy requirement to return the vehicle back to its “its pre-loss operational safety,

function, and appearance” (Appx1090) reinforces that return to original appearance

is not a conscious design choice.

3. The Individual Designs of the Hood and Headlamp are not a


Matter of Concern

Since the subject designs are not ornamental under this Court’s reasoning in

Best Lock, it is not necessary to address the issue of “matter of concern.” However,

ABPA will reply to FGTL’s argument.

Citing In re Webb, 916 F.2d 1553 (Fed. Cir. 1990), FGTL argues the

appearances of the hood and headlamp are a matter of concern because they are not

hidden from view. FGTL Br. 30-31. FGTL fails to consider that the hood and

headlamp are repair/replacement items sold by part number and In re Webb states

“many replacement items, including vacuum cleaner brushes, are sold by

replacement or order number, or they are noticed during sale only to assess

functionality” and “[i]n such circumstances, the PTO may properly conclude that an

11
application provides no evidence that there is a period in the commercial life of a

particular design when its ornamentality may be a matter of concern.” Id. at 1558.

Further, In re Webb involved a design for a femoral hip stem prosthesis and

did not involve a design for a component part or portion of the article sold. The case

therefore does not address the issue of whether a design, when considered

individually, may not be a matter of concern to a purchaser because it is a part of an

overall design that is being considered for purchase. There is no record evidence in

this case that a consumer purchases an F-150 based on the design of the claimed

portions of the hood and headlamp separate and apart from the appearance of the

overall design of the F-150. As argued by ABPA in the opening brief and as

supported by the analysis in Best Lock, the only customer concern for the hood and

headlamp designs during original purchase is that they are aesthetically compatible

with the F-150’s overall appearance.

4. Aesthetic Functionality is Relevant to Whether a Design is


Ornamental

The ultimate issue regarding ornamentality is not whether there are other

designs that can perform the same mechanical function as the subject designs, but

rather whether there are alternative designs that allow for a conscious design choice

to be made. See MPEP 1504.01(c); In re Carletti, supra, at 1022; ABPA Br. 12-13.

If there are no conscious design choices to be made, then it should not matter whether

the lack of choices is due to mechanical factors or due to appearance. It is for this

12
reason that consideration of so called “aesthetic functionality” is proper when

determining whether a design is ornamental in the mate and match

repair/replacement context.

In its response argument, FGTL states “ABPA appears to recognize that its

functionality arguments fail as a matter of design patent law.” FGTL Br. 33. That

is incorrect as consideration of aesthetic functionality is proper when determining

whether a conscious design choice was made. FGTL states that ABPA is requesting

this Court to “change long standing precedent in the design patent area.” FGTL Br.

33. However, the quote referred to the elimination of the “point of novelty” test in

Egyptian Goddess, Inc. v. Swisa, Inc., 543 F.3d 665 (Fed. Cir. 2008) (en banc) and

not to the issue of aesthetic functionality, which has yet to be addressed by this Court.

FGTL argues against consideration of aesthetic functionality because the

purpose of trademark law is to promote competition while “[d]esign patents, unlike

trademark protection, thus are intended to inhibit competition for a period of time.”

FGTL Br. 34. FGTL’s argument suffers from the same problem as the District

Court’s opinion: neither considers that design patent law seeks to balance the

promotion of competition with promotion of the decorative arts. See Avia Group

International Inc. v. L. A. Gear California Inc., 853 F.2d 1557, 1563 (Fed. Cir.

1988). This balance is reflected in the statutory requirement that a patentable design

be "ornamental,” meaning that when a design is not the result of decorative design

13
choices, granting a design patent to such a design would not serve the purpose of

promoting the decorative arts.

In response to ABPA’s argument that “the ultimate question is not whether

competition is adversely affected, but rather whether there is a conscious design

choice being made that promotes the decorative arts,” FGTL Br. 35, FGTL does not

even attempt a substantive response. Rather, FGTL simply states “ABPA is not even

asking the Court to apply the aesthetic functionality doctrine from trademark law”

and “[ABPA] is instead asking the Court to make up a brand new standard for

judging the ornamentality of design patents, or at least design patents of automotive

components.” FGTL Br. 35.

ABPA is not asking this Court to make up a “brand new standard,” but rather

is asking this Court to recognize that it is proper to recognize aesthetic functionality

when determining whether a conscious design choice was made, which is the

ultimate issue when determining whether a design is ornamental. As stated in

ABPA’s opening brief, “[t]his conclusion is supported by the analogous concept of

aesthetic functionality in the field of trademarks.” ABPA Br. 24. ABPA therefore

refers to trademark aesthetic functionality because it is conceptually similar and

helpful to the analysis - not due to any claim that it is exactly the same in purpose

and effect.

14
FGTL concludes “[t]his Court need not follow ABPA down a new legal

path,” and because “ABPA has conceded that it is not arguing that the ’299 or ’685

patents have mechanical or utilitarian functionality,” “[t]his Court should

accordingly affirm the District Court’s functionality ruling on that basis.” FGTL Br.

35. Significantly, FGTL fails to make any substantive response to ABPA’s

argument that aesthetic functionality should be considered when determining

whether a conscious design choice was made in the mate and match and

repair/replacement context.

5. Consideration of the Market when determining Enforceability

FGTL misreads ABPA’s argument regarding consideration of the market.

FGTL states ABPA’s argument to be “even if the ’299 and ’685 patents are valid

design patents when an F-150 is first purchased, those patents lose their validity

when it comes to assessing replacement parts.” FGTL Br. 35-36. ABPA is not

arguing that the patents are invalid in the repair/replacement market, but rather that

the patents should be considered unenforceable in that market.

ABPA argues “[a]s an alternative argument, focusing on the particular

market served also is appropriate in design patent law because the matter of concern

inquiry relates to the concerns of the purchaser.” ABPA Br. 37. FGTL states “that

argument makes no sense” because “this Court has made clear that if a design is a

15
matter of concern at any point in an article’s life, that design is patentable. [citing]

Webb, 916 F.2d at 1557.” FGTL Br. 36.

FGTL’s argument ignores that in the repair/replacement market, the only

matter of concern for the customer is that the part design match the original design.

To partially repeat the quote from In re Webb: “many replacement items … are sold

by replacement or order number” and [i]n such circumstances, the PTO may

properly conclude that an application provides no evidence that there is a period in

the commercial life of a particular design when its ornamentality may be a matter of

concern.” Id. at 1558. (emphasis added).

Finally, FGTL makes no effort to respond to ABPA’s argument that design

patent functionality is a flexible concept that has been used in ways other than to

invalidate a design patent such as factoring out elements during claim construction.

II. The Patent Exhaustion Doctrine Applies in this Case

FGTL fails to properly analyze the exhaustion issue for design patents and

focuses instead on the analysis used for utility patents. As indicated by the line of

cases involving exhaustion and method patents such as Quanta Computer Inc. v. LG

Electronics, Inc., 553 U.S. 617 (2008), the exhaustion doctrine is flexible enough to

be adapted to different types of patents. ABPA argues that the patent exhaustion

doctrine should be properly adapted to the design patent context including

component parts and portion claiming.

16
FGTL states “[u]nder the exhaustion doctrine, the sale of a patented article

exhausts the patentee’s rights as to that article.” (emphasis in original). (citing Jazz

Photo Corp. v. Int’l Trade Comm., 264 F.3d 1094, 1105 (Fed. Cir. 2001). However,

in Jazz Photo there were no design patents covering less than the entire exterior of

the cameras and the exterior design was unaffected by the remanufacturing process.

Therefore, issues involving component parts and portion claiming simply were not

raised or analyzed and the reference to “that article” necessarily could not have

distinguished between the article sold or a component part of the article sold.

FGTL states: “[i]t has long been established that the doctrine does not permit

the purchaser to infringe a patent by making (or buying) new copies of a patented

component and claiming the new copies are “repairing” the original article.” FGTL

Br. 37. However, FGTL then only cites two cases involving utility patents, Aiken v.

Manchester Print Works, 2 Cliff. 435 (1865) and Morgan Envelope Co. v. Albany

Perforated Wrapping Paper Co., 152 U.S. 425 (1894). FGTL cites no cases

involving design patents for its alleged “well-established principles.”

A. FGTL’s 150-Year-Old Precedent Applies to Utility Patent Cases


but Not Design Patent Cases

Every case cited by FGTL involves a utility patent, including the Jazz Photo

case, which also involved a utility patent in the portion of the Jazz Photo opinion

cited by FGTL. As explained in ABPA’s opening brief and as explained below, the

analysis for patent exhaustion in a utility patent case is different from the analysis

17
for patent exhaustion in a method patent case and should be different in a design

patent case as well. When the patent exhaustion doctrine is properly adapted to the

design patent context, exhaustion applies in this case.

B. This Court should accept ABPA’s Analysis that Applies


Established Patent Exhaustion Principles to Design Patents

FGTL argues that ABPA is requesting “a new exhaustion regime, solely for

design patents ….” FGTL Br. 41. That is incorrect, as ABPA is arguing that

established exhaustion principles should be applied to design patents in a way that

recognizes their unique nature, which is precisely what this Court and the Supreme

Court did when adapting exhaustion principles to method patents. Indeed, in the

method patent context, when the patentee argued that method patents were not

directed toward the sale of a product and that exhaustion should not apply, the

Supreme Court adapted the doctrine and reasoned that exhaustion applied to the sale

of an article that substantially embodied the patented method. See Quanta

Computer, supra, at 2117. This was an effective solution to a complex issue and

one that has proven both predictable and workable in practice. Notably, FGTL

avoids any mention of how the patent exhaustion doctrine has been adapted to

method patents in its response argument.

FGTL states “ABPA’s arguments with respect to exhaustion are difficult to

follow” FGTL Br. 41, but FGTL does not explain why it finds the argument difficult

to follow other than to say it finds ABPA’s argument to be “confusing.” FGTL Br.

18
41. However, it appears FGTL’s confusion may be the result of FGTL misstating

ABPA’s argument.

FGTL states ABPA’s argument is that utility patents are directed to a specific

article of manufacture such as a knitting machine or a knitting machine needle and

that is why patent exhaustion did not apply to replacement of the knitting machine

needle in Aiken that was separately patented. FGTL Br. 41-42. Correct so far. But

then FGTL states ABPA’s argument to be “where a design patent claims a design

for a component of a larger product, such as a headlamp design for an F-150 truck,

the relevant ‘article’ is the larger product, not the component” and “the right to repair

the F-150 truck permits a consumer to make (or buy) a copy of a patented headlamp

component.” FGTL Br. 42. FGTL claims ABPA’s theory is “completely made up”

and contrary to Samsung, which held “the term ‘article of manufacture’ is broad

enough to encompass both a product sold to a consumer as well as a component of

that product.” 137 S. Ct. at 435. FGTL Br. 42. FGTL concludes that “ABPA’s theory

that the F-150 truck is the relevant ‘article’ (rather than a component such as the

hood or headlamp) is simply incorrect under Samsung.” FGTL Br. 42.

FGTL misreads ABPA’s argument. ABPA is not arguing that in an

exhaustion analysis for design patents the relevant article of manufacture is the larger

product to the exclusion of the component part or portion thereof. Rather, ABPA

argues that “the design claimed can be embodied in both a portion of [an] article of

19
manufacture and also a portion of a component of an article of manufacture,” ABPA

Br. 52, and that exhaustion applies to any product sold that embodies the patented

design. This argument should be clear from ABPA’s opening brief.

Further, rather than being “completely made up,” ABPA’s argument is the

same type approach this Court uses when analyzing exhaustion for method patents.

In Quanta Computer, supra, when LGE argued “because method patents are linked

not to a tangible article but to a process, they can never be exhausted through a sale,”

Id. at S.Ct. 2117, the Supreme Court disagreed, stating “[i]t is true that a patented

method may not be sold in the same way as an article or device, but methods

nonetheless may be ‘embodied’ in a product, the sale of which exhausts patent

rights.” Id. Similarly, although design patents are not specifically linked to one

particular article of manufacture because they are for an article of manufacture and

may claim a portion thereof, design patents can be embodied in more than one article

of manufacture (for example a parent, component, and portion of a component), the

sale of any of which should exhaust patent rights.

Further, ABPA’s argument is supported by Samsung. As FGTL’s brief states

at page 42: “the term ‘article of manufacture’ is broad enough to encompass both a

product sold to a consumer as well as a component of that product.” (quoting and

citing Samsung, 137 S. Ct. at 435) (emphasis added). That is exactly what ABPA is

arguing – the term article of manufacture is broad enough to include the F-150, the

20
hood and headlamp, and the portions of the hood and headlamp claimed in the design

patents.

Now to be sure, Samsung was on appeal to determine what the article of

manufacture was for computing damages under 35 U.S.C. § 289. But that is an

entirely difference purpose than determining article of manufacture for exhaustion.

Indeed, under section 289, the focus is on the article sold by the accused infringer

and under exhaustion, the focus is on the article sold by the patent owner.

Under section 289, the “article of manufacture” must be determined to

calculate the accused infringer’s “total profit.” The current test for determining

article of manufacture under section 289 consists of these factors: (1) the scope of

the design claimed in the plaintiff's patent, including the drawing and written

description; (2) the relative prominence of the design within the product as a whole;

(3) whether the design is conceptually distinct from the product as a whole; and (4)

the physical relationship between the patented design and the rest of the product,

including whether the design pertains to a component that a user or seller can

physically separate from the product as a whole, and whether the design is embodied

in a component that is manufactured separately from the rest of the product, or if the

component can be sold separately. See Apple, Inc. v. Samsung Electronics Co. Ltd,

Case No. 11-cv-01846, *35 (N.D. Cal. October 22, 2017).

21
Notably, references to “product as a whole” in factors (2), (3) and (4), and

references to “product” in factor (4) are references to the product sold by the accused

infringer, and not to the “product as a whole” and “product” sold by the patent owner.

So clearly this test is not meant to determine article of manufacture for exhaustion

purposes.

Further, the four-factor test (or something similar) would not be appropriate

to determine article of manufacture for exhaustion because the test is too

complicated and uncertain. In the utility patent context, determination of article of

manufacture sold for exhaustion purposes is straightforward because a utility patent

is directed toward a specific article of manufacture. In the method patent context,

the courts have made the inquiry relatively straightforward by asking whether the

article sold embodies or substantially embodies the method patent. Ambiguity is

eliminated with the use of this test.

For design patents, there also can be ambiguity as to article of manufacture.

Indeed, ambiguity is the reason the four-factor test is needed under section 289.

When there is ambiguity concerning article of manufacture, the purpose of the

exhaustion doctrine is best served by having a test similar to the method patent test

that is broad and includes articles sold that embody the patented design.

Indeed, the Supreme Court recently reaffirmed the breadth of the patent

exhaustion doctrine, stating “we conclude that a patentee’s decision to sell a product

22
exhausts all of its patent rights in that item …” and “[t]he sale ‘terminates all patent

rights to that item.’” Impression Prods., Inc. v. Lexmark Int'l, Inc., 137 S. Ct. 1523,

1529, 1531 (2017) (citing Quanta Computer, supra, at 625) (method patent).

Further, in Impression Products, the Supreme Court provides an illustration

for why the exhaustion doctrine does not permit restraints on alienation of patent

rights, appropriately using vehicle repair as the illustration:

Take a shop that restores and sells used cars. The business works
because the shop can rest assured that, so long as those bringing in the
cars own them, the shop is free to repair and resell those vehicles. That
smooth flow of commerce would sputter if companies that make the
thousands of parts that go into a vehicle could keep their patent rights
after the first sale. Those companies might, for instance, restrict resale
rights and sue the shop owner for patent infringement. And even if they
refrained from imposing such restrictions, the very threat of patent
liability would force the shop to invest in efforts to protect itself from
hidden lawsuits. Either way, extending the patent rights beyond the first
sale would clog the channels of commerce, with little benefit from the
extra control that the patentees retain.

Id. at 1532 (emphasis added).

This example also serves to illustrate why the embodiment test proposed by

ABPA is appropriate. Unless the ambiguity and uncertainty over “article of

manufacture” in the design patent exhaustion context is resolved with a

straightforward embodiment test, “the very threat of patent liability [will] force the

shop to invest in efforts to protect itself from hidden lawsuits” and “clog the channels

of commerce.” Id.

23
Significantly, FGTL appears to agree with the principle that an article which

embodies but is larger than the article claimed by the design patent may be repaired

under the patent exhaustion doctrine. FGTL states: “Thus, although consumers may

repair a hood or headlamp that is damaged, they may not replace the hood or

headlamp with a completely new part.” FGTL Br. 40. Notably, it is not the entire

hood or headlamp that is claimed in FGTL’s design patents, but rather only portions

of the hood and headlamp. For the hood as shown below left, the under portion

shown in broken lines is not claimed. Appx181-182. For the headlamp as shown

below right, neither the outer plastic lens nor the rear housing, shown in broken lines,

is claimed. Appx191-193.

When FGTL states “consumers may repair a hood or headlamp that is

damaged” FGTL Br. 40, FGTL does not state specifically what may be repaired and

24
what may be replaced in the hood or headlamp to repair it. For example, under

FGTL’s statement, the headlamp can be permissibly repaired by replacing a cracked

or damaged outer lens or rear housing (unclaimed), or by replacing a cracked or

otherwise damaged reflector or side marker lamp (claimed). So FGTL effectively is

using the same test for exhaustion advocated by ABPA: as long as the article of

manufacture sold by FGTL embodies the patented design, it may be permissibly

repaired under the patent exhaustion doctrine even though the repair may involve

replacing component articles that also embody the claimed design. The only

difference is that FGTL argues the larger hood and headlamp may be repaired and

ABPA argues the larger F-150 may be repaired. But the arguments are conceptually

the same in that each argues that an article larger than that actually claimed may be

permissibly repaired as long as the article embodies the claimed design.

FGTL may argue that the “article of manufacture” is not the component(s)

actually claimed or the F-150, but rather the hood and headlamp.2 But there has been

2
The title of the ‘299 Patent is “Exterior of Vehicle Hood” (Appx174) and the title
of ‘685 Patent is “Vehicle Head Lamp.” (Appx183). The origin of the four-factor
test adopted for determination of the article of manufacture under section 289 is the
“Brief for the United States as Amicus Curiae Supporting Neither Party.” 2016 U.S.
S. Ct. Briefs LEXIS 2322, *46-48 (June 8, 2016). In the brief, the United States
argues that “the factfinder should not treat the patent's designation of the article as
conclusive” out of a concern that the patentee could manipulate the result through
its characterization of the article in the title. Id. at *46. The title likewise should not
be deemed conclusive when considering the article of manufacture for exhaustion
purposes.

25
no such finding in this case and it would be inappropriate to make such a finding for

the purpose of exhaustion. FGTL has not proposed a test for determining a specific

article of manufacture for the purpose of right to repair in a design patent case and

one wonders what it would be. The article of manufacture test for section 289 is not

appropriate because it is complicated and designed for use in litigation when the

purpose is to determine a fair amount of profit that should be disgorged from the

accused infringer.

Determining right to repair in a design patent case is fundamentally different

than determining profits under section 289. As explained in ABPA’s opening brief

at page 55, it is an implied license that underlies the right to repair, and the scope of

the implied license “must be based on what the parties reasonably intended as to the

scope of the implied license based on the circumstances of the sale.” See

Carborundum Co. v. Molten Metal Equip. Innovs., 72 F.3d 872, 878 (Fed. Cir.

1995). Here, as explained in ABPA’s Brief page 56, the circumstances are that the

parts are not marked with patent numbers so when a customer purchases an F-150,

they have no notice, actual or constructive, that components of the hood and the

headlamp are patented. The F-150 is advertised and sold as a complete article with

an overall design rather than as a collection of individual parts with individual

designs. Finally, to the extent a customer may be aware of the subject design patents,

26
they state the hood and headlamp are “intended for attachment to a vehicle.”

(Appx174, Appx183).

Under these circumstances, it is not appropriate to determine what article of

manufacture may be repaired based on a complicated four-factor test because such

a test would not appropriately consider reasonable expectations based on the

circumstances of the sale. A test that is consistent with the parties’ reasonable

expectations is whether the article sold embodies the patented design, which is the

test proposed by ABPA and the test used in the method patent context.

FGTL concludes its argument with a list of who has supposedly rejected

ABPA’s argument. This Court should not be persuaded. ABPA did not argue before

the International Trade Commission3, ABPA is appealing the District Court’s

rulings, and the New World District Court simply adopted the rulings of the District

Court with no independent analysis.

C. The Sale of an F-150 Grants an Implied License to Repair the F-


150

As explained above, the sale of an F-150 embodying the claimed designs

grants an implied license to repair the F-150, including the purchase and use of

component parts that also embody the claimed designs. FGTL argues “ABPA has

made this argument up” FGTL Br. 53, and states ABPA has cited no case in support

3
The ITC Order is neither controlling, see Powertech Technology Inc. v. Tessera,
Inc., 660 F.3d 1301, 1308 (Fed. Cir. 2011), nor correct. See Appx2177-2181.

27
of its position. However, as set forth in ABPA’s opening brief at pages 55-56 and

as set forth above, ABPA cites cases that explain the relevant implied license

principles. Further, ABPA properly applies these principles to the circumstances of

the F-150 sale. FGTL concludes by citing Hewlett-Packard Co. v. Repeat-O-Type

Stencil Mfg. Corp., 123 F.3d 1445, 1451 (Fed. Cir. 1997) for the proposition that

“re-creation of a patented article ‘is an infringement because such activity is beyond

the implied authorization to use and sell a patented device’” FGTL Br. 43, but

Hewlett-Packard involves only utility patents and therefore is not relevant to

ABPA’s argument and analysis.

D. ABPA Members are entitled to assert Exhaustion and Implied


License as a Defense.

FGTL argues “[t]he fact that a purchaser may have a license to make or

purchase a patented part does not retroactively grant ABPA’s members immunity

for making that part without a license” and cites three cases (Crossroads Systems,

Global Communications, and Asetek Holdings) for the proposition that patent

exhaustion applies to “downstream sales” and not “upstream manufacturers.” FGTL

Br. 44-45. However, none of the cases cited by FGTL involve the right to repair.

When the right to repair is involved, it necessarily includes the right to purchase

repair parts from others. See Kendall Co. v. Progressive Medical Technology, Inc.,

85 F.3d 1570, 1573 (Fed. Cir. 1996).

28
CONCLUSION AND RELIEF SOUGHT

Based on the arguments and authorities above and in ABPA’s opening brief,

the District Court erred in denying ABPA’s motion for summary judgment and

granting summary judgment in favor of FGTL. ABPA requests that this case be

reversed and summary judgment rendered in favor of ABPA, and that this Court

grant such other and further relief to which ABPA may show itself to be justly

entitled.

July 19, 2018

Respectfully submitted,

/s/ Robert G. Oake, Jr.


Robert G. Oake, Jr.
Texas Bar No. 15154300
Oake Law Office
700 S. Central Expy., Suite 400
Allen, Texas 75013
Telephone: 214.207.9066
rgo@oake.com

Paul M. Kittinger (P72754)


CARDELLI LANFEAR, P.C.
322 W. Lincoln
Royal Oak, MI 48067
(248) 544-1100
pkittinger@cardellilaw.com

Attorneys for ABPA

29
CERTIFICATE OF COMPLIANCE

1. This brief complies with the type-volume limitation of Federal Rules of

Appellate Procedure 32(a)(7)(B) and Federal Circuit Rule 32(a) because it

contains 6,996 words, excluding the parts of the brief exempted by the rules.

2. This brief complies with the typeface requirements of Federal Rules of

Appellate Procedure 32(a)(5) and the type style requirements of Federal Rules

of Appellate Procedure 32(a)(6). This brief has been prepared in a

proportionally spaced typeface using Microsoft Word in 14-point Times New

Roman font.

/s/ Robert G. Oake, Jr.


Robert G. Oake, Jr.
Attorney for Plaintiffs-Appellants
July 19, 2018

30
FORM 30. Certificate of Service Form 30
Rev. 03/16

UNITED STATES COURT OF APPEALS FOR THE FEDERAL CIRCUIT

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Robert G. Oake, Jr. Is/ Robert G. Oake, Jr.


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Address 700 S. Central Expy., Suite 400

City, State, Zip Allen, Texas 75013


Telephone Number 214.207.9066

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E-Mail Address rgo@oake.com

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