Oakley Inc v. Trillion Top Co Ltd LLC

I. Executive Summary and Procedural Information

• Parties & Counsel:
  • Plaintiff: Oakley, Inc. (Washington)
  • Defendant: Trillion Top Company Limited LLC (Hong Kong, S.A.R.)
  • Plaintiff’s Counsel: Knobbe, Martens, Olson & Bear, LLP
• Case Identification: 8:17-cv-01580, C.D. Cal., 09/13/2017
• Venue Allegations: Plaintiff alleges venue is proper in the Central District of California because Defendant has a "continuous, systematic, and substantial presence," has committed acts of infringement by selling products in the district, and has a "regular and established place of business" there.
• Core Dispute: Plaintiff alleges that Defendant’s "Shark" line of watches infringes two U.S. design patents covering the ornamental appearance of a watch and a watch dial.
• Technical Context: The dispute falls within the consumer watch industry, where distinctive and recognizable product designs are a primary basis for competition and brand identity.
• Key Procedural History: The complaint does not reference any prior litigation, inter partes review proceedings, or licensing history relevant to the patents-in-suit.

Case Timeline

Date	Event
2010-03-04	'043 Patent Priority Date
2010-05-04	'229 Patent Priority Date
2011-11-08	U.S. Design Patent D648,229 Issued
2012-05-08	U.S. Design Patent D659,043 Issued
2017-09-13	Complaint Filing Date

II. Technology and Patent(s)-in-Suit Analysis

U.S. Design Patent No. D648,229 - "Watch," issued November 8, 2011

• The Invention Explained:
  • Problem Addressed: In the field of watchmaking, there is a constant need for new and unique ornamental designs to distinguish products in a competitive marketplace (Compl. ¶6).
  • The Patented Solution: The patent claims the specific, non-functional, ornamental design for a watch as depicted in solid lines in its figures. The design is characterized by a generally circular, robust case with four prominent, screw-like features on the bezel, distinctive lugs for attaching a strap, and a large, textured crown assembly on the left side of the case (’229 Patent, FIGS. 1-7). The patent protects the overall visual impression created by this combination of elements (’229 Patent, Description).
  • Technical Importance: A unique watch case design can serve as a signature element for a brand, making the product instantly recognizable to consumers and creating significant commercial value (Compl. ¶¶ 6, 8).
• Key Claims at a Glance:
  • The patent contains a single claim for: "The ornamental design for a watch, as shown and described." (’229 Patent, Claim).
  • The scope of this claim is defined by the visual representations in Figures 1-7 of the patent, with features shown in broken (phantom) lines not forming part of the claimed design (’229 Patent, Description).

U.S. Design Patent No. D659,043 - "Watch Dial," issued May 8, 2012

• The Invention Explained:
  • Problem Addressed: The patent addresses the need for a novel ornamental design for the face, or dial, of a watch, which is a key component of its overall aesthetic (Compl. ¶¶ 6, 9).
  • The Patented Solution: The patent claims the ornamental design for a watch dial, independent of the surrounding watch case (which is shown in phantom lines). The design’s prominent features include large, stylized Arabic numerals at the 3 and 9 o'clock positions, blocky hour markers for the other hours, and a distinctive vertical element bisecting the dial (’043 Patent, FIGS. 1-7). The claim covers the specific visual appearance created by these elements as shown in the patent's drawings (’043 Patent, Description).
  • Technical Importance: The dial design is often the focal point of a watch and is critical in establishing a product's visual identity and appeal to consumers (Compl. ¶¶ 6, 9).
• Key Claims at a Glance:
  • The patent contains a single claim for: "The ornamental design for a watch dial, as shown and described." (’043 Patent, Claim).
  • The claim's scope is defined by the solid lines in the patent’s drawings; the watch case, hands, and strap are depicted in broken lines and are not part of the claimed design (’043 Patent, Description).

III. The Accused Instrumentality

• Product Identification: The accused instrumentalities are watches sold by Defendant, identified as the "Salmon Shark Series," "Shark Stainless Steel," and other "Shark Infringing Products" (Compl. ¶¶ 15, 18).
• Functionality and Market Context: The complaint alleges these products are watches that Defendant makes, uses, sells, offers for sale, or imports into the United States (Compl. ¶10). The products are allegedly sold through retailers such as "overstock.com and directly through online marketplaces" (Compl. ¶10). The core of the infringement allegation rests on the visual appearance of the accused watches. The complaint provides a photograph of several "SHARK Infringing Products," suggesting a line of watches with varying color schemes but a consistent underlying design (Compl. p. 5).

IV. Analysis of Infringement Allegations

In design patent cases, infringement is determined by the "ordinary observer" test, which asks whether an ordinary observer, familiar with the prior art, would be deceived into purchasing the accused product believing it to be the patented design. The complaint alleges direct infringement by presenting side-by-side visual comparisons.

'229 Patent Infringement Allegations

The complaint alleges that the overall ornamental design of Defendant's watches is "substantially similar" to the design claimed in the '229 Patent (Compl. ¶15). To support this, the complaint provides a side-by-side image comparison of the accused "Salmon SHARK Series" watch and a figure from the '229 Patent (Compl. p. 4). This visual juxtaposes the accused product, which features a bulky circular case and prominent lugs, with the patented design embodying similar characteristics. Plaintiff further alleges that the accused products are an "identical copy" of the patented design (Compl. ¶17).

'043 Patent Infringement Allegations

The complaint alleges that the watch dial of Defendant's products is "substantially similar" to the design claimed in the '043 Patent (Compl. ¶18). This allegation is supported by another side-by-side comparison, this time showing the dial of the accused "Salmon SHARK Series" watch next to a figure from the '043 Patent (Compl. p. 6). The comparison highlights similarities in the stylized numerals at the 3 and 9 o'clock positions and the overall layout of the hour markers. The complaint asserts that Defendant’s actions constitute infringement because the accused dial design would appear substantially similar to an ordinary observer (Compl. ¶18).

• Identified Points of Contention:
  • Scope Questions: The primary legal question is whether the accused designs are "substantially the same" as the patented designs in their overall visual effect. A court will have to determine if minor differences between the accused watches and the patent drawings are sufficient to escape infringement, or if they are trivial in the context of the overall impression.
  • Technical Questions: A key factual question will be how an ordinary observer perceives the designs. The analysis will focus on the visual evidence, comparing the claimed design's unique features—such as the '229 Patent's case and lug shape and the '043 Patent's stylized numerals and dial layout—with the corresponding features on the accused "Shark" watches.

V. Key Claim Terms for Construction

In design patent litigation, the "claim" is understood to be the design itself as depicted in the drawings, and traditional claim construction of written terms is typically not a central issue. The analysis focuses on visually comparing the claimed design with the accused product.

The dispute will likely not center on construing a specific term, but on the overall scope of the design claim. The parties may present arguments regarding:

• The Overall Visual Impression: The primary focus will be on the overall appearance of the designs, rather than a "checklist" comparison of individual features.
• The Role of Prior Art: The scope of a design patent claim is viewed in light of the prior art. The novelty of the patented design compared to earlier watch designs will inform the degree of similarity required to find infringement.
• Non-Functional Elements: The analysis will be limited to ornamental features. Any aspects of the design dictated solely by function are not protected and must be factored out of the infringement analysis.

VI. Other Allegations

• Indirect Infringement: The complaint focuses on allegations of direct infringement under 35 U.S.C. § 271 for making, using, selling, and importing the accused watches (Compl. ¶¶ 10, 15, 18). It does not plead specific facts to support separate claims for induced or contributory infringement.
• Willful Infringement: The complaint alleges that Defendant’s infringement was willful and deliberate (Compl. ¶12). This allegation is based on claims that Defendant had "actual knowledge" of Oakley's design rights and that the infringement was undertaken with "reckless disregard" (Compl. ¶¶ 16, 17, 19, 20). The complaint further contends that Defendant's infringement was "so obvious" it should have known its actions were infringing and that its products are an "identical copy" of Oakley's patented design (Compl. ¶¶ 17, 20).

VII. Analyst’s Conclusion: Key Questions for the Case

The resolution of this dispute will likely depend on the court's determination of the following questions:

1. A core issue will be one of visual identity: Applying the ordinary observer test, are the overall ornamental designs of Defendant's "Shark" watches and their dials "substantially the same" as the designs claimed in the '229 and '043 patents, respectively? This will involve a holistic comparison of the designs' visual impressions, not just a dissection of their individual elements.

2. A key evidentiary question will concern willfulness: What evidence can Plaintiff produce to support its allegation that Defendant had pre-suit "actual knowledge" of the specific patents, or that it engaged in "identical" copying, which would be necessary to support a finding of willful infringement and potential enhancement of damages?

3. A central question for remedy will be the calculation of damages: If infringement is found, will Plaintiff be entitled to an award of Defendant’s total profits from the infringing articles under 35 U.S.C. § 289, a remedy specific to design patent infringement that the complaint explicitly seeks? (Compl. ¶¶ 24, 24(C)).