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Brinks: New House Bill Limits Patent Protection For Auto Parts

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ANN ARBOR — Legislation reintroduced Feb. 2 by members of the U.S. House Judiciary Committee would drastically reduce the term of design patent protection for automotive repair parts from 14 years to a mere 30 months.

That’s the word from Kelly Burris, a shareholder in the Ann Arbor office of the intellectual property law firm Brinks Hofer Gilson & Lione.   The bill, titled the “Promoting Automotive Repair, Trade, and Sales” (PARTS) Act, allows for the blanket manufacture, testing, importation and pre-sale distribution of repair parts that would otherwise infringe a design patent for automotive “component parts.” The PARTS bill only limits use and sale of such repair parts until 30 months after the patented part is offered for sale.

“If the bill is allowed to pass, original equipment manufacturer (OEM) patentees of automotive parts will effectively suffer a complete obliteration of their design patent rights,” Burris said.

Design patents are among three types of patents in the United States (the other two being utility patents that protect how something works or how it is constructed and plant patents that protect asexually reproduced plants). Generally, design patents protect the ornamental appearance of an object, or essentially what a product looks like. Common examples include the Statue of Liberty (patented in 1879), the Volkswagen Beetle (newer design patented in 2001) and the Apple iPad (patented in 2011).

The PARTS bill was reintroduced by Representatives Darrell Issa (R-Calif.) and Zoe Lofgren (D-Calif.) and purports to “preserve consumer choice, reduce insurer and driver costs and improve competition in the market for replacement automotive parts.”

The bill sets out two main provisions:
* Whoever makes or offers to sell in the United States, or imports into the United States, any repair part that is similar to or the same as a component part that is claimed in a design patent is not liable for design patent infringement; and
* Whoever uses or sells such repair parts thirty (30) months after the patented component part is first offered for sale as part of a motor vehicle is not liable for design patent infringement.

“In effect, non-OEM manufacturers can immediately begin developing, testing and manufacturing repair parts, and even begin their marketing efforts, without being liable for infringement,” Burris said. “And once the brief 30 month period approaches expiration, these non-OEM manufacturers, distributors, and related companies can have their fingers on the ‘launch’ button to gain market share in what is meant to be reserved for patentees for 14 years under the Patent Laws. Allowing such a bill to pass would minimize the constitutional rights of innovative product developers and may disincentivize automotive innovations.”

As a defensive strategy, Burris says companies that obtain design patents on their originally manufactured component parts should also consider utility patent protection for such parts since the PARTS bill is exclusively directed to design patent infringement. To the extent possible, design patent applications should be filed as early as possible to ensure that a design patent is issued prior to an offer for sale of component parts in order to maximize the proposed 30 month term.

Brinks Hofer Gilson & Lione has 140 attorneys, scientific advisors and patent agents who specialize in intellectual property litigation and all aspects of patent, trademark and copyright law. The firm also advises on issues relating to intellectual asset management, trade secret, unfair competition, and technology and licensing agreements. Founded in 1917, Brinks is based in Chicago and has five additional offices across the country, including Ann Arbor. More information is available at www.usebrinks.com.

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