IP Concerns for Consumer Products

December 2015

By: William Seymour 

Consumer products present unique intellectual property concerns, including both design rights and functional intellectual property. Below are ten points that consumer products manufacturers should consider with each of their product lines:

Product development cycles

Most consumer products are designed, developed, and sold according to a rigid, periodic schedule set by the relevant market/industry. Take the time to consider where intellectual property decisions fit into your development cycle and be mindful of when certain milestones need to be met, for example, before publicly showing or offering the product for sale. Work with your IP attorneys to develop an IP development schedule that fits with your product deadlines.

Design patent protection

Design patents make a lot of sense for consumer products and are a relatively inexpensive way to protect the overall appearance of your design. Work with your IP counsel to seek broad design patent claims from the Patent Office to protect the distinctive and desirable features of your product design.  Armed with a broad design patent, your competitors will think twice before selling a product with similar design features.

Registering your product trade dress

Product trade dress is often a good compliment to design patent protection. Although trade dress is limited to the non-functional aspects of your product design, a trade dress registration may last indefinitely.  You should consider any potential source-identifying features of your design or design elements that might be common to multiple products. These features might be good candidates for trade dress registration.

Utility patents

While many consumer products may not include any new technology, you should carefully evaluate your new products for any potential innovations. If a utility patent application is appropriate, you will need to meet several critical deadlines during your product development cycle. For example, at least a provisional patent application adequately describing your novel features should be filed before publicly showing or offering your product for sale.

Your competitors’ IP

It is helpful to assess any competitors’ intellectual property as early as possible in your design cycle. Identifying problematic intellectual property early allows your team to either develop a reasonable alternative design or reconsider further development. A careful review of your competitors’ intellectual property should be a standard part of your early design process. When appropriate, it may also be advisable to seek a formal, written opinion letter from your attorney prior to moving forward with a preliminary product design.

Industry standard licenses

Many of the common technologies that are incorporated into every-day consumer products are actually protected technologies, such as MP3, USB, Bluetooth, AAC, and WiFi. However, because these may be considered standard-essential technologies, the companies owning them may license their use based on standard, reasonable rates. If you have questions about whether you should obtain a license, you should speak with an IP attorney early on in your design process.

OEM Agreements

Often times, consumer products may be developed or revised in consultation with an original equipment manufacturer. However, companies should carefully consider the IP implications of these often-times casual interactions, which may result in unwanted inventorship or ownership disputes. Work with your attorneys to make sure that all OEMs that may have input on product design are covered by a suitable OEM Agreement.  

IP insurance 

Once a niche product, intellectual property insurance is now widely available from multiple insurers. Companies that operate within a litigious industry, such as consumer electronics, may wish to consider taking out an IP insurance policy in connection with the release of a new product. Such insurance policies can be critical when your product is challenged by a patent troll or one of your competitors and can spare your company the expense associated with an unanticipated litigation.

Understand who you are indemnifying

Under the Uniform Commercial Code, which has been adopted by most states, merchants automatically indemnify product purchasers and warrant that their products are “free of the rightful claim of any third person by way of infringement.” This means that, unless otherwise agreed, you may be held to account for an infringement claim made against any purchaser of your products, even if you are not directly named in the lawsuit. The Uniform Commercial Code may be superseded by an agreement between the parties, however, so it is advisable to attempt to limit liability by agreement whenever possible.

Virtual Patent Marking

Consumer product manufacturers sometimes struggle to meet the patent marking requirements of the Patent Act, for example, when space on the product is limited, or when the product begins manufacturing before the relevant patents have been issued by the Patent Office. However, under the America Invents Act, product designers can now simply mark their products with the word “patent” or “pat.” together with the URL of a Web page where any applicable patent number may be found. Virtual marking may be used to simplify the manufacturing process while meeting the patent marking requirements.