TESTIMONY OF WILLIAM T. FRYER, III PROFESSOR UNIVERSITY OF BALTIMORE SCHOOL OF LAW BALTIMORE, MARYLAND
BEFORE THE SUBCOMMITTEE ON COURTS AND INTELLECTUAL PROPERTY COMMITTEE ON THE JUDICIARY UNITED STATES HOUSE OF REPRESENTATIVES 105TH CONGRESS
OCTOBER 23, 1997
VESSEL HULL DESIGN PROTECTION ACT
H. R. 2696 (105TH CONG., 1ST SESS.)
TABLE OF CONTENTS
I. TESTIMONY ------------------------------------------------------------------------------------ 3
A. INTRODUCTION ----------------------------------------------------------------------- 3
B. HISTORICAL AND FUNDAMENTAL CONTEXT OF THE LEGISLATION --------- 3
C. CURRENT FORMS OF INTELLECTUAL PROPERTY PROTECTION
APPLICABLE TO VESSEL HULLS ------------------------------------------------ 4
D. PRIOR STATE LEGISLATIVE EFFORTS TO PROTECT VESSEL HULLS ---------- 5
E. GENERAL INDUSTRIAL DESIGN PROTECTION LEGISLATION
APPLICABLE TO VESSEL HULL PROTECTION -------------------------------- 6
F. SEMICONDUCTOR CHIP PROTECTION ACT OF 1984---------------------------- 7
G. PRELIMINARY ANALYSIS OF THE VESSEL HULL
PROTECTION ACT LEGISLATION ---------------------------------------------- 8
H. INPUT NEEDED TO DETERMINE IF VESSEL HULL, MOLD
AND PLUG PROTECTION IS IN THE PUBLIC INTEREST-------------------- 10
I. INTERNATIONAL PERSPECTIVE --------------------------------------------------------- 11
II. WITNESS STATEMENT CONCERNING FEDERAL GRANT,
CONTRACT AND SUBCONTRACT -------------------------------------------------- 11
III. WITNESS MAIL ADDRESS, TELEPHONE, FAX AND
E-MAIL ADDRESS --------------------------------------------------------------------- 12
IV. CURRICULUM VITAE -------------------------------------------------------------------- 12
Mr. Chairman, it is my honor to participate in this hearing, the first one on the Vessel Hull Design Protection Act legislation. I hope my testimony will provide a useful background for evaluating this legislation.
I have been involved in design protection research and writing for almost 20 years, as a law professor. I have served, at different times, as chair of the American Bar Association, Section of Intellectual Property Law, Industrial Designs Committee and the American Intellectual Property Law Association Industrial Design Committee. Recently, I have been working with the World Intellectual Property Organization (WIPO) and the U.S. government in connection with revision of an industrial design treaty that will help the U.S. obtain improved international protection of industrial designs. I will let enclosed Curriculum Vitae introduce my writings and other activities.
The Vessel Hull Protection Act legislation must be reviewed in the historical context of U.S. design protection. My testimony will begin with a review of the relevant history and fundamentals for design protection. I will analyze the legislation and compare it with related intellectual property protection, making several suggestions on topics that need to be studied further. Finally, I will review the legislation in relation to relevant international intellectual property developments.
B. HISTORICAL AND FUNDAMENTAL CONTEXT OF THE LEGISLATION
This testimony can only outline some of the prior developments relevant to the legislation. A review of this history is very important in evaluating the likely effectiveness, public interest and political aspects of this type of legislation. There have been prior attempts to protect vessel hulls, using state laws. Several current forms of intellectual property will provide protection for features of a vessel hull, with certain limitations.
The primary starting point for this review is to recognize the legislation would protect the shape of a vessel hull from copying. It will not provide exclusive rights against independent creation. One who infringes the design right under this legislation must use the vessel hull of another person and make a copy from it, or from the plug or mold related to the hull manufacture. I am not an expert in hull construction. I owned a sailboat for several years, and I am familiar, generally, with construction of a fiberglass type boat.
C. CURRENT FORMS OF INTELLECTUAL PROPERTY PROTECTION APPLICABLE TO VESSEL HULLS
The Coke bottle shape is a famous design that is protected by trademark law. Its shape presents a distinctive appearance that makes customers think of the drink's source, the Coca Cola Company. Federal trademark law does not provide protection for product shapes that are primarily functional, i.e. serve a utilitarian purpose that must be used to compete effectively . For example, the shape of a shower head in the Teledyne case was found to be unprotectable as a trademark, since the presumption was that its features were primarily to facilitate the operation of the device. A trademark is a perpetual right, existing as long as the design remains a mark. Trademark infringement does not depend on whether the alleged infringer copies the mark or innocently infringes. Either act is prohibited.
Vessel hulls may be trademarks, but they must stand up to a rather difficult test concerning the issue of whether the features are distinctive as a mark and their utilitarian role.
U.S. copyright has provided some protection for product shape for certain items. Lamp bases, animal foot like shoes and toys are some examples. Generally, if a product shape is part of the functional operating features, copyright protection will not be provided for that shape, unless there is a conceptually separable design that can stand apart as an artistic work. This result is due to the statutory provision for separability of the copyrighted design from the useful article. Copyright infringement requires copying, with proof required of the copier's access to the copyright product. The term of a copyright can be up to the life of the design plus 50 years,
It is doubtful that a vessel hull could be protected by copyright, except in a model form.
U.S. design patent law is based on the same general principles that apply to utility and plant patents, with certain exceptions. The design patent rights are exclusive, preventing independent creation as well as copying. Design patent protection is limited to the ornamental features of a product. The design patent term is 14 years from the issuance of the patent. With the Coke bottle example, a design patent could protect the bottle shape, since there are many other shapes that could be used to carry out the same function of holding the liquid. In this respect, the trademark and design patent law have essentially the same requirement, that purely functional features cannot be protected.
It takes about two years to obtain a design patent, under regular procedures.. There is no protection until the patent issues. Additional standards that must be met are novelty and non-obvious and statutory bars that must be avoided, caused by failing to file the application within a certain period after public use or on sale in this country..
Design patents have been obtained on the shape of vessel hulls.
Utility patents protect inventions that perform a useful result, mainly due to the functional interaction of parts or materials. The average time for obtaining a utility patent is about 19 months, and the term is 20 years from the U.S. filing date. The exclusive right protects against independent creation and copying. There is no protection until the patent issues.
The utilitarian features of a vessel hull may be protected if the patent standards.
D. PRIOR STATE LEGISLATIVE EFFORTS TO PROTECT VESSEL HULLS
States statutes have been used unsuccessfully to protect vessel hulls from copying by prohibiting molding an existing hull shape. A statute in Florida, for example, applied just to vessel hulls ,while one in California, for example, the applied also to molding other products. These statutes were held preempted by the federal patent law in the U.S. Supreme Court case of Bonito Boats Inc v. Thunder Craft Boats Inc.
While these state statutes were preempted, the Bonito Boats case left undecided whether a federal statute, such as this legislation, could be drafted to protect vessel hulls without conflict with the patent law. The present legislation raises the issue of patent law preemption at the federal level. It is doubtful that such a preemption conflict exists, because no conflict has been found in connection with the Semiconductor Chip Protection Act of 1984 discussed below.
E. GENERAL INDUSTRIAL DESIGN PROTECTION LEGISLATION APPLICABLE TO VESSEL HULL PROTECTION
In 1991, H.R. 1790 (102d Cong., 1st Sess.) was pending and strongly supported by many design related industries. It was an attempt to improve industrial design protection, with some of the features the same as the ones in the Vessel Hull Design Protection Act legislation. The Supreme Court in Bonito Boats referred to legislation, like H.R. 1790, as pending at the time of the decision and the fact that Congress was under some criticism for not enacting it. This legislation provided protection for product shape and excluded certain products due to political concerns. It specifically excluded protection for the purely functional (utility patent type features).
The H.R. 1790 legislation was closely aligned with design patent type scope of protection, but it had several new features. Under H.R. 1790 product shapes, and other designs, could be protected upon introduction to the marketplace, when protection was most needed. The legislation provided a procedure for registration within one year after such use began, followed by protection after registration for a total of ten years from the first market introduction.
The early marketing protection feature of H.R. 1790 became very attractive and later, as described below in connection with the Semiconductor Chip Act of 1984, it was use there to protect computer chips manufactured in accordance with a specific process.
The general industrial design legislation, represented by H.R. 1790, was not enacted by Congress, due largely to a special issue concerning copying of original automobile parts to make replacement parts. The opposing interest groups could not reach a compromise. Unfortunately the need for this protection remains in many industries.
The Vessel Hull Design Protection Act legislation is modeled after H.R. 1790, using several of its operating features, including early protection, registration and the 10 year maximum term of protection. The safeguards carefully developed for innocent infringers and against abuse of the design right are now in the new legislation. They are workable provisions and created no serious controversy when H.R. 1790 was proposed.
F. SEMICONDUCTOR CHIP PROTECTION ACT OF 1984
In 1981, approximately, the computer chip industry came to Congress with a request for improved protection of chips. This industry demonstrated that it needed immediate protection upon introduction of its products, and it could not wait two or three years later for a utility patent right to begin. Since Congress was considering the general industrial design legislation, like H.R. 1790 discussed above, Congress responded by accepting a narrowed down version of the general design legislation limited to computer chips manufactured by a mask utilization process. The Semiconductor Chip Act of 1984 (Chip Act) was enacted promptly, after several hearings. Its history is well documented in the literature.
Some say the Chip Act was not needed or successful. Only one case was decided under this law. On the other hand, it seems that a more logical explanation is that the law did its job, protecting a specific area of technology with the proper balance included to make it workable.
The Chip Act was unique in one other respect, in its treatment of product functionality. This law protected product appearance and function, both distinctive ornamental features and purely functional features. The Chip Act prevented copying of whatever was seen on the chip layers, as built up from the mask works that shaped the surface design, regardless of whether the features were ornamental or only functional. It was necessary to give this protection to have a simple, one-stop chip protection system upon entry of the product into the market.
It is the early protection and what you see is what you protect features of the Chip Act that the Vessel Hull Design Protection Act legislation has utilized. Several procedural provisions used in the Chip Act are part of the Vessel Hull Protection Act legislation. This fact is not surprising when it is recognized that the Chip Act and the Vessel Hull Design Protection Act are children, essentially of H.R. 1790, as discussed above.
G. PRELIMINARY ANALYSIS OF THE VESSEL HULL PROTECTION ACT LEGISLATION
The proceeding historical and fundamental review of intellectual property protection for product shape has identified several topics that need to be considered in connection with the Vessel Hull Design Protection Act legislation (current Legislation). This history suggests that general, broad based, industrial design protection legislation is hard to enact, but given a specific industry demonstrated need, design protection legislation can be enacted relative quickly. The H.R. 1790 legislative experience demonstrates how difficult it is on a broad scope of subject matter protection to obtain agreement between opposing groups.
The current legislation is more similar to the Chip Act than the H.R. 1790 legislation. The Vessel Hull Design Protection Act legislation focuses on a particular product and manufacturing process, just as the Chip Act did. While the current legislation does not specifically state it protects purely functional features, I interpret it that way, based on its absence of any exclusion of such subject matter and other language in the legislation, discussed below. The Chip Act did protect function and appearance, and the need for the same kind of protection appears to exist for vessel hulls.
Several features of the Vessel Hull Design Protection Act legislation will be discussed now, with reference to the general industrial design legislation represented by H.R. 1790 and the Chip Act.
In §1001 the current legislation states the design protected has to be "original". This term is well accepted in other intellectual property laws, as meaning that the designer created the work independently, not copied it from someone else. This provision states the design "provides a distinguishable variation over prior work". I interpret this provision as meaning that the design adds something to what is known by the designer. It is not a general novelty test, which is found elsewhere in the legislation. H.R. 1790 has the same type of provision on originality The Chip Act did not define the term "originality", but it was stated to be a requirement for the protected design.
The current legislation protects a design that is part of three related parts used in a manufacturing process - the hull is the final product, made from a mold, and the mold is manufactured from the plug. The plug transfers the design shape to the mold, in a concave form, and the mold transfers the design to a hull with the usual convex vessel hull shape. These parts are interrelated, as I understand the process and have the same design, essentially.
The definitions of mold and plug in the legislation indicates that the device includes purely function features in the design, when it states "regardless of whether the device or model has an intrinsic utilitarian function". Perhaps this language should be added to the definition of the hull, and a general statement added that the legislation protection includes purely functional features.
There is no clearly stated "non-obvious standard, as required in the design patent law, but several novelty requirements are in the legislation before a protected design can be obtained. These requirements are essentially the same as in H.R. 1790, and they did not present a problem during the legislative debate as far as novelty was concerned. It is clearly a lower novelty standard than the one applied to design patents, in some respects, but in another respect it is a much higher standard. There is no limit on where the novelty event can occur in the current legislation, while in the patent law certain novelty defeating events can occur only in the U.S.
The Chip Act has essentially the same novelty standard as the current legislation, expressed in a more compact form. There is a provision that novelty can exist in substantially new combinations of old features, and this provision was in H.R. 1790, but it was not in the Chip Act. It merely clarifies what would be proper legal interpretation even under the Chip Act.
The current legislation contrasts with H.R. 1790 in protecting both the ornamental appearance and utilitarian function of the vessel hull, mold and plug. H.R. 1790 excluded from protection features that were "dictated solely by a utilitarian function of the article that embodies it" As mentioned above, the mold and plug definitions in the current legislation includes utilitarian features. Since it is possible to obtain a utility patent on the same features, I suggest adding to § 1229 of the current legislation that the issue of a utility patent on a design protected under the Act would terminate protection under the Act.
A one-year time limits is set for filing an application for registration of a design protected under this legislation. This time length corresponds to the H.R. 1790 legislation provision It forces prompt registration. The Chip Act allowed two years to register Perhaps the two year period is a more reasonable time to decide if registration is necessary to obtain the rest of the ten year protection term.
Most of the current legislation procedural provisions, such as safeguards for potential infringers, the notice provisions, infringement rights registration procedures, benefit of foreign filing date, are the same as in H.R. 1790 and similar to the Chip Act. This fact is not surprising when the heritage of the current legislation is identified, as discussed above.
In summary, the current legislation gives vessel hull designers the right to prevent copying of the hull shape, the mold and plug used to make that design. Innocent infringers are protected. The experience with H.R. 1790 and the Chip Act provides a good resource for evaluating whether the current legislation has the needed balance to be effective.
H. INPUT NEEDED TO DETERMINE IF VESSEL HULL, MOLD AND PLUG PROTECTION IS IN THE PUBLIC INTEREST
The history of H.R. 1790 and the Chip Act suggests the boat industry must make a strong case for needing vessel hull design protection upon market entry. The case was made for semiconductor chips, resulting in passage of the Chip Act. The general industrial design legislation, H.R. 1790, was so broadly based that certain industries could not agree on whether such protection was needed, and Congress would not take a stand for protection of innovation and creative work, that would have forced a compromise.
The door is open for the Vessel Hull Design Protection Act legislation to be the second of a design law series for protection of designs in specific industries. In this way the public interest will be served by carefully tailoring the protection to the needs of the public and industry, to maintain a competitive and fair market that encourages innovation, not destructive copying.
I. INTERNATIONAL PERSPECTIVE
The basic feature of the current legislation, protection against copying when a product is introduced in the market, is a principle that has attracted interest in several countries.. It has been incorporated, essentially, in several new design laws or proposals. For example, the European Union has proposed essentially the same principle for it new Community Design.
Japan recently enacted an unfair competition law that prevents slavish copying of product shapes and other design features that would appear to provide protection similar to the current legislation.
Germany, and several other countries have very broad unfair competition laws that prevent copying of product designs and other related business interests.
Several countries provide utility model protection, essentially a short term, reduced requirements type of utility patent. It fills a gap for relatively cheap and quick protection. The utility model does not give market entry protection that was found essential for the Chip Act. The utility model must be examined or at least registered before protection begins.
II. WITNESS STATEMENT CONCERNING FEDERAL GRANT, CONTRACT AND SUBCONTRACT
In 1995, 1996 and 1997 I have received no federal grant, contract or subcontract. I do not represent any entity in presenting my testimony at this hearing.
III. THE WITNESS' MAIL ADDRESS, TELEPHONE NUMBER, FAX NUMBER AND E-MAIL ADDRESS ARE:
WILLIAM T. FRYER, III PROFESSOR UNIVERSITY OF BALTIMORE SCHOOL OF LAW 1420 NORTH CHARLES STREET BALTIMORE, MD 21201, U.S.A.
OFFICE TELEPHONE: (410) 837-4560 OFFICE FAX: (410) 837-4560 E-MAIL ADDRESS: WFRYER@UBMAIL.UBALT.EDU
IV. CURRICULUM VITAE (October 21, 1997) (INCLUDING SELECTED PUBLICATION LIST) [OMITTED - SEE WEB SITE PAGE WITH CURRRICULUM VITAE]
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