[Senate Report 112-259]
[From the U.S. Government Publishing Office]
Calendar No. 573
112th Congress } } Report
SENATE
2d Session } } 112-259
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INNOVATIVE DESIGN PROTECTION ACT OF 2012
_______
December 20, 2012.--Ordered to be printed
_______
Mr. Leahy, from the Committee on the Judiciary,
submitted the following
R E P O R T
together with
MINORITY VIEWS
[To accompany S. 3523]
[Including cost estimate of the Congressional Budget Office]
The Committee on the Judiciary, to which was referred S.
3523, a bill to amend title 17, United States Code, to extend
protection to fashion design, and for other purposes, having
considered the same, reports favorably thereon, without
amendment, and recommends that the bill do pass.
CONTENTS
Page
I. Background and Purpose of the Innovative Design Protection Act of
2012.............................................................1
II. History of the Bill and Committee Consideration..................4
III. Section-by-Section Summary of the Bill...........................4
IV. Congressional Budget Office Cost Estimate........................6
V. Regulatory Impact Evaluation.....................................8
VI. Conclusion.......................................................8
VII. Minority Views of Senators Coburn, Cornyn, Lee, and Sessions.....9
VIII.Changes to Existing Law Made by the Bill, as Reported...........12
I. Background and Purpose of the Innovative Design Protection Act of
2012
The United States fashion industry provides jobs for more
than four million American workers and accounts for $350
billion in annual retail sales. The industry is not only an
engine for economic growth but one of the most important,
common, and accessible sources for artistic expression in the
nation. In terms of the protections available to designers,
however, the United States remains at a disadvantage compared
to the European Union, with which we compete to be the global
center of the fashion industry. In Europe today, with thriving
fashion capitals like Paris, London, and Milan, designers are
afforded significant protection (ranging from three to twenty-
five years) for their creative endeavors.\1\
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\1\Prior to 1998, there were varying degrees of protection for
design, including fashion design, in different European Union member
countries. In 1998, the European Parliament and Council of Europe
passed a directive to harmonize the design laws of the member states.
Council Directive 98/71, 1998 O.J. (L 289) 28 (EC). Further
codification was added by the European Council in 2002 with a
regulation that explicitly set forth a two-tiered scheme of protection,
providing a three-year term of protection to unregistered designs and
up to twenty-five years of protection for registered designs. Council
Regulation 6/2002, 2002 O.J. (L 3) 1 (EC).
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By contrast, fashion design in the United States, for the
most part, has not enjoyed substantial intellectual property
rights protection. Although the core economic strength of the
U.S. fashion industry has shifted away from manufacturing and
toward design over the course of half a century, the law has
not kept up with the times by extending protection to
inventive, groundbreaking fashion. The Innovative Design
Protection Act (``the Act'') represents a well-balanced attempt
to protect truly original and innovative fashion design without
stifling creativity, spurring frivolous lawsuits, or hindering
the industry's ability to do business. Drafted in consultation
with the full range of interested parties, from designers to
manufacturers to retailers, the Act will ensure that American
fashion designers can receive a return on their investments and
that the U.S. fashion industry can maintain its position as a
global leader.
The Act is narrowly tailored to afford the minimum
intellectual property protections necessary to protect the
innovative fashion designs that help drive the vibrancy of the
fashion industry. It applies only to fashion designs that are
unique and have never before been seen. The Act does not extend
protection to components of designs--such as sleeves,
shoulders, or pockets--but rather, only to the article as a
whole. In addition, the myriad designs that are in the public
domain (such as, for example, cargo shorts, denim jeans, and
pencil skirts) would not be entitled to protection.
The Act also has more safeguards against unnecessary
litigation than other intellectual property laws. First, the
Act requires that a plaintiff provide written notice to an
alleged infringer. A lawsuit cannot be filed, and damages
cannot accrue, until 21 days after such notice is provided and
no cure has been achieved.\2\
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\2\It is the intention of the Act that an alleged infringer should
not be able to claim that he has cured a violation merely by selling or
transferring the items to another business entity.
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Second, the Act provides for a heightened pleading
standard. A plaintiff must be able to state in his complaint
that he has a protected design, that the defendant's design
infringes, and that the design was available in a way such that
one can infer that the defendant saw or had knowledge of the
design. This last element specifically requires that ``the
protected design or an image thereof was available in such
location or locations, in such a manner, and for such duration
that it can be reasonably inferred from the totality of the
surrounding facts and circumstances that the defendant saw or
otherwise had knowledge of the protected design.'' In other
words, the particular facts of an individual pleading should
give rise to the reasonable inference that the defendant knew
of the design. For example, the plaintiff can offer facts that
show consumers' knowledge of the first design and the latter
design, the date of a public runway show, or the date that
retail establishments first offered both designs. The pleading
standard does not require the plaintiff to plead facts about
the defendant's actions or to show the defendant's subjective
knowledge, since the plaintiff could not be aware of such
circumstances before discovery.\3\
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\3\This requirement, however, should not be interpreted to
eliminate the independent creation defense (see infra).
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Third, there are severe penalties for misrepresentation by
a plaintiff.
Fourth, the term of protection is only three years, the
shortest extant term of intellectual property protection.\4\
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\4\In Europe, by contrast, designs can be afforded up to twenty-
five years of protection. See Council Directive, supra note 1, art. 10.
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Fifth, an infringing design must be ``substantially
identical'' to the protected design, in other words, a copy
that is ``so similar in appearance as to be likely to be
mistaken for the protected design, and contains only those
differences in construction or design which are merely
trivial.'' Such trivial differences are intended to include,
for example, a small difference in design that is the result of
a cheaper manufacturing process, such as the substitution of
less expensive materials or processes--or literally cutting
corners to reduce the amount of fabric or trim. As in other
tests for similarity under the Copyright Act, the question
whether an allegedly infringing copy is substantially identical
to a protected original is determined by reference to the
ordinary observer and does not require reference to time-
consuming and costly consumer surveys or other methods used to
establish likelihood of confusion in trademark.
Under the Act, there is no liability for consumers who
purchase an infringing design, or for home sewers who design
and make items for personal use. As defenses, a defendant may
argue that his design is an independent creation, or that the
protected design is not, in fact, new, but is, instead, part of
the existing public domain of fashion designs.
The bill also clarifies the standards for showing that a
second or third-party actor committed an act of infringement.
Chapter 13 currently protects sellers and distributors by
providing a higher threshold for these actors to be found
liable for infringement. The bill states explicitly that
secondary and tertiary actors, such as retailers and importers,
should benefit from the heightened standards set forth in
Section 1309. The Act thus limits liability for secondary and
tertiary actors to those who collude with infringers or those
who decline to reveal the source of their merchandise and
subsequently order or reorder the infringing article.
Finally, the Act makes clear that merely providing Internet
sales facilities is not an act of infringement.
The Innovative Design Protection Act has the support of the
Council of Fashion Designers of America, a trade association
consisting of creative designers, and the American Apparel &
Footwear Association, the largest U.S. fashion industry trade
association.
II. History of the Bill and Committee Consideration
A. INTRODUCTION OF THE BILL
Senator Schumer introduced the Innovative Design Protection
Act of 2012 on September 10, 2012. Senators Blumenthal, Boxer,
Cardin, Gillibrand, Graham, Hatch, Kohl, Snowe, and Whitehouse
were original cosponsors. On September 19, 2012, Senator
Klobuchar was added as cosponsor.
The legislation derives from the Design Piracy Prohibition
Act of 2007, S. 1957, which Senator Schumer introduced on
August 2, 2007. That legislation was substantially revised
after consultation with industry representatives, and
reintroduced on August 5, 2010, as the Innovative Design
Protection and Piracy Prevention Act, S. 3728. The Judiciary
Committee favorably reported that bill on December 6, 2010.
Further constructive compromise changes were made before the
legislation was introduced this Congress as S. 3523.
B. COMMITTEE CONSIDERATION
The bill was placed on the Judiciary Committee's agenda on
September 10, 2012.
The Committee considered the legislation on September 24,
2012. Senator Lee offered an amendment, joined by Senator
Cornyn and Senator Coburn, that would award reasonable
attorneys' fees to the prevailing party. The amendment was
rejected by a voice vote.
The Committee then voted to report the Innovative Design
Protection Act of 2012, S. 3523, without amendment, favorably
to the Senate by voice vote. Senators Kyl, Cornyn, Lee and
Coburn were recorded as voting against the bill.
III. Section-by-Section Summary of the Bill
Section 1--Short title
This section provides that the legislation may be cited as
the ``Innovative Design Protection Act of 2012.''
Section 2--Amendments to Title 17, United States Code
Subsection (a): This subsection extends the protection of,
and adds the necessary definitions to, the ``definition''
paragraph of 17 U.S.C. 1301 in order to protect unique fashion
designs. The terms defined are ``fashion design,'' ``apparel,''
and, in the case of a fashion design, ``substantially
identical.''
``Substantially identical'' means only those designs that
could be mistaken for the protected original, with ``only those
differences in construction or design which are merely
trivial.'' The term ``substantially identical'' is intended to
create a heightened standard for infringement of protected
fashion designs as compared with the ``substantially similar''
standard used in copyright law. It is not, however, to be
confused with the term ``substantially identical'' as used
elsewhere in intellectual property law. For fashion designs,
substantial identicality shall be determined by the trier of
fact viewing the protected design and the copy sequentially and
from the perspective of an ordinary observer. An allegedly
infringing article shall be determined to have been copied from
a protected design if the differences between the protected
design and the copy are merely trivial in the eye of the
ordinary observer viewing the protected design and the copy
sequentially.
A ``fashion design'' under this Act is limited to the
``appearance as a whole'' of an article of apparel; a single
element--for example, a sleeve--is not entitled to protection.
Furthermore, a design that garners the protection of this Act
must include design elements, including both original designs
and non-original elements with original placement, that are
``the result of a designer's own creative endeavor'' and
``provide a unique, distinguishable, non-trivial and non-
utilitarian variation over prior designs for similar types of
articles.''
``Non-trivial'' means the same thing for the purposes of
determining whether a design is protected, and whether a
defendant's design is substantially identical to the protected
design.
Subsection (b): This subsection defines designs that are
not subject to protection. This section accepts the definition
of designs that are not subject to protection under existing
law, and in the case of fashion design, adds an exception for
designs that are embodied in a useful article that was made
public by the designer before the date of enactment, or more
than three years before the date upon which the protection of
the design is asserted. (This comports with the Act's limiting
protection to a period of three years.)
Subsection (c): Subsection (c) addresses revisions,
adaptations, and rearrangements that are specific to a fashion
design. The Act would limit design protection by providing that
the presence or absence of a particular color, or of a picture
or graphic that is imprinted on fabric, is not part of
considering whether a fashion design gets protection, or
whether infringement has occurred. For example, the switching
of colors or prints on a design would not be enough of a
difference to entitle the revised design to protection, nor
would it subject the revised design to liability for infringing
the original, unswitched design.
Subsection (d): This subsection sets forth the term of
protection for fashion designs. While designs of vessels and
hulls receive 10 years of protection under current law, fashion
designs receive three years of protection.
Subsection (e): Under this subsection, the owner of a
design would be required to provide an alleged infringer with a
detailed written notice of his or her belief that a protected
design has been infringed. The owner would not be able to file
suit until 21 days after the date on which written notice was
provided to the alleged infringer. In addition, this subsection
provides that an award under this Act would only be available
for damages and profits that accrue after the filing date of
the action for infringement.
Subsection (f): Subsection (f) clarifies the standards for
showing that a second- or third-party actor committed an act of
infringement. Section 1309 currently provides for a heightened
threshold of liability for sellers and distributors; subsection
(f) explicitly extends this standard to importers as well, and
clarifies that retailers are covered by this section. This will
ensure that the same standard of liability applies to all
secondary and tertiary actors, rather than, under current law,
potentially putting importers in the same ``bucket'' as
manufacturing infringers. This section would also include
``offering for sale'' as an act that cannot constitute
infringement without knowledge. (Under existing law, making,
importing, selling, or distributing cannot constitute
infringement without knowledge.) ``Knowledge,'' under this
section, would be modified by the language, ``either actual or
reasonably inferred from the totality of the circumstances.''
In addition, this subsection would make clear that it is
not an act of infringement to provide a telecommunications
service, or to transmit or store a communication (or handle a
communication in a way that does not modify it).
This subsection also defines an ``infringing article'' with
respect to fashion designs. While an infringing article for
vessel hull designs, under current law, requires that an
infringing article be ``substantially similar'' to the
original, a fashion design is only an infringing article if it
is ``substantially identical'' to the original design with
regard to appearance and elements, or is not the result of
independent creation.
This subsection also creates a ``home sewing exception''
that allows protected designs to be copied for personal use.
Subsection (g): This subsection would amend 17 U.S.C.
1310(a) to exempt fashion designs from the registration process
requirement.
Subsection (h): This subsection creates a heightened
pleading standard for fashion designs. A claimant must plead
with particularity facts that establish that the design is a
fashion design within the meaning of the Act; that the design
of the defendant infringes upon the protected design; and that
the protected design or an image of it was available in a way
that would make it reasonably inferable that the defendant had
seen or known of the protected design.
Subsection (i): Subsection (i) would increase the penalties
for making false representations in order to obtain recovery
for a claim of infringement under Chapter 13, from a $500
minimum to a $5,000 minimum, and from a $1,000 maximum to a
$10,000 maximum.
Subsection (j): This subsection would exempt fashion design
from Treasury and Postal Service importation regulations.
Subsection (k): This subsection would clarify that certain
intellectual property protections already available for limited
aspects of fashion designs, such as copyright protection for
original fabric prints or trademark protection, would still
exist and would be unaffected by this legislation.
Section 3--Effective date
This section establishes the effective date of the Act as
the date of enactment.
IV. Congressional Budget Office Cost Estimate
The Committee sets forth, with respect to the bill, S.
3523, the following estimate and comparison prepared by the
Director of the Congressional Budget Office under section 402
of the Congressional Budget Act of 1974:
U.S. Congress,
Congressional Budget Office,
Washington, DC, November 5, 2012.
Hon. Patrick J. Leahy,
Chairman, Committee on the Judiciary,
U.S. Senate, Washington, DC.
Dear Mr. Chairman: The Congressional Budget Office has
prepared the enclosed cost estimate for S. 3523, the Innovative
Design Protection Act of 2012.
If you wish further details on this estimate, we will be
pleased to provide them. The CBO staff contact is Susan Willie.
Sincerely,
Douglas W. Elmendorf.
Enclosure.
S. 3523--Innovative Design Protection Act of 2012
CBO estimates that implementing S. 3523 would have no
significant cost to the federal government. Enacting the bill
would not affect direct spending but could affect revenues;
therefore, pay-as-you-go procedures apply. However, CBO
estimates that any effects would be insignificant for each
year.
S. 3523 would provide protection similar to a copyright,
lasting for three years, for original fashion designs. Those
protections would allow the owner of a protected design to make
(or import) and sell any useful article embodying the design.
The bill would require the owner to provide written notice to a
person thought to be violating those protections and to wait 21
days after providing such notice before instituting an action
for infringement. S. 3523 also would increase the amount of
penalties that could be levied for falsely representing
information when registering a design or obtaining recovery on
a claim of infringement.
Based on information from the Library of Congress, CBO does
not expect that implementing S. 3523 would significantly change
the workload or expenditures of the Copyright Office because
the bill does not require fashion designs to be registered in
order for the protections to take effect. Because S. 3523 would
raise the amount of penalties that could be collected for
making false representations in certain instances, the federal
government might collect additional civil fines if the bill is
enacted. Such fines are recorded as revenues; CBO expects that
any additional collections would not be significant because of
the relatively small number of cases likely to be affected.
S. 3523 contains no intergovernmental mandates as defined
in the Unfunded Mandates Reform Act (UMRA) and would impose no
costs on state, local, or tribal governments.
S. 3523 would impose a private-sector mandate as defined in
UMRA. By providing protection for original fashion designs, the
bill would prohibit any person from manufacturing, selling, or
distributing an article of apparel that copies a protected
fashion design. To use a protected fashion design, a person
must obtain the consent of the owner of the protected design.
The cost of complying with the mandate would be the cost of
obtaining consent or the cost of changing designs and any
revenue forgone from removing designs from the market. The cost
of the mandate is uncertain, however, because it would depend
in part on future court actions. Therefore, CBO cannot
determine whether the aggregate cost of the mandate would
exceed the annual threshold for private-sector mandates ($146
million in 2012, adjusted annually for inflation).
The CBO staff contacts for this estimate are Susan Willie
(for federal costs) and Paige Piper/Bach (for the private-
sector impact). The estimate was approved by Theresa Gullo,
Deputy Assistant Director for Budget Analysis.
V. Regulatory Impact Evaluation
In compliance with rule XXVI of the Standing Rules of the
Senate, the Committee finds that no significant regulatory
impact will result from the enactment of S. 3523.
VI. Conclusion
The Innovative Design Protection Act, S. 3523, addresses
the lack of protection in intellectual property laws for truly
innovative and unique fashion designs. Granting innovative
American fashion designers some of the same intellectual
property protections recognized in other countries so that
their businesses can continue to grow and thrive, the Act
creates a limited, three-year protection for certain fashion
designs and provides a legal remedy for the owners of these
protected articles when they are copied.
VII. Minority Views
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MINORITY VIEWS FROM SENATORS COBURN, CORNYN, LEE, AND SESSIONS
We write to explain our opposition to S. 3523, the
Innovative Design Protection Act of 2012 (the ``Act''), and our
support for an amendment that would provide for the award of
reasonable attorneys' fees to the prevailing party in a lawsuit
under the Act.
The United States fashion industry is an important engine
for economic growth, contributing billions of dollars to our
economy each year. It is also an important means for artistic
expression. American designers are among the most creative in
the world, and their designs have long formed the basis of many
of the world's fashion trends.
The fashion industry is financially successful and, for
more than half a century, has experienced consistent and
continuous growth.\1\ Robust competition within the industry
has led to innovation and consumer choice. The fashion industry
is thus a model for how a free market benefits everyone:
artists, designers, manufacturers, laborers and consumers.
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\1\See Innovative Design Protection and Piracy Prevention Act:
Hearing Before the Subcomm. on Intellectual Property, Competition and
the Internet of the H. Committee on the Judiciary, 112th Cong. 74-76,
75 (2011) (testimony of Christopher Sprigman, Professor of Law,
University of Virginia School of Law).
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The Constitution authorizes Congress ``To promote the
Progress of Science and useful Arts, by securing for limited
Times to Authors and Inventors the exclusive Right to their
respective Writings and Discoveries.'' By creating limited
monopolies in the form of copyright and patent protection,
Congress on many occasions has exercised that authority to
encourage innovation.
This Act seeks to extend copyright protection to fashion
design for the first time in our nation's history. It addresses
concerns expressed by incumbent designers that their original
designs are copied and sold by competitors to the detriment of
those incumbents.
We understand that concern and the negative impact that
copying can have on certain fashion designers. But any time the
federal government enacts legislation, we must proceed
cautiously. We have learned from experience that legislation
has many consequences, some of which can be unintended,
unforeseen, and negative. That same experience reveals a
legislative propensity towards expanding rights once created.
By contrast, Congress has been much less successful paring down
statutory rights, even where evidence demonstrates that such
rights have become overly-broad. Accordingly, before creating a
new monopoly right, as this Act would, we must be certain that
it addresses systematic and permanent threats to industry and
consumers, and that the statutory remedy is narrowly tailored
so as to apply only to conduct that is harmful.
We have three reasons to be especially cautious here.
First, we must take special care not to upset a well-
functioning market. This is particularly true where, as is the
case with the fashion market, the market is characterized by
innovation and low barriers to entry. Statutory monopolies by
their nature increase prices for consumers. Any benefit inuring
to incumbent designers as a result of the Act would be offset
by these increased costs, which could be borne by middle-income
consumers.
Second, while copying within the fashion industry no doubt
presents a threat to certain designers, some scholars have
suggested that it is also a significant driver of
innovation.\2\ Copying may generate rapid demand for new
designs as older, copied designs lose some of their appeal.
This issue is the subject of lively debate. But absent a
stronger showing that a practice is systematic and harmful to
the market as a whole, the threat of encroachment on liberty
represented by any congressional enactment tips the balance
against government intervention in the private market.
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\2\See id.
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Third, we remain concerned about the effect of creating a
new private right of action. Litigation is an essential
enforcement mechanism for many rights, but it also creates
inefficiencies and costs for innocent parties as well as the
guilty. The Act would force non-incumbent fashion designers--
many of whom are small businesses with limited litigation
budgets--to internalize substantial liability risks. It would
also potentially chill innovation and raise prices for
consumers.
Since our Committee considered the 2010 version of the Act,
the Act's sponsors have made several changes intended to
prevent frivolous litigation. The Act now requires that a
design owner provide notice of infringement, that a design
owner provide an alleged infringer a 21-day period to cure any
violation, and that a plaintiff plead a case of alleged
infringement with particularity.
We commend these efforts, but we feel that they do not go
far enough. Under the Act, large incumbent designers and their
legal teams would have an understandable incentive to seek to
expand the boundaries of the law through litigation. These
efforts, coupled with potentially uneven judicial application,
are another consequence of the law we must consider. Our staffs
have spoken with many businesses that may be affected
negatively by the proposed new right to sue. They remain
concerned about the continued potential for frivolous
litigation.
To mitigate these concerns, we support an amendment that
Senators Cornyn, Lee, and Coburn introduced during our
Committee's consideration of the Act. The amendment would
establish a so-called ``loser pays'' system, pursuant to which
the court would award reasonable attorneys' fees to the
prevailing party in a lawsuit under the Act. Such a rule would
reward good claims and discourage bad ones. It would reduce the
ability of litigious parties to bring weak cases solely to
threaten their opponents economically. It would shift the costs
of over-pleading, lengthy litigation, excessive discovery, and
unnecessary motion practice, to plaintiffs who would seek to
use the legal system to bully competitors.
We believe this amendment provides the fairest and most
effective means to deter unnecessary and frivolous litigation,
and thus mitigates the threat a new copyright and right to sue
would pose to a competitive industry. By reducing liability
risk, the amendment would secure greater freedom for fashion
designers and help preserve an industry in which consumers have
broad access to fashion designs.
Tom Coburn.
John Cornyn.
Mike Lee.
Jeff Sessions.
VIII. Changes to Existing Law Made by the Bill, as Reported
In compliance with paragraph 12 of rule XXVI of the
Standing Rules of the Senate, changes in existing law made by
S. 3523, as reported, are shown as follows (existing law
proposed to be omitted is enclosed in black brackets, new
matter is printed in italic, and existing law in which no
change is proposed is shown in roman):
UNITED STATES CODE
TITLE 17. COPYRIGHTS
* * * * * * *
CHAPTER 13--PROTECTION OF ORIGINAL DESIGNS
* * * * * * *
Sec. 1301. Designs Protected
* * * * * * *
(a) Designs Protected.--
(1) In general.--The designer or other owner of an
original design of a useful article which makes the
article attractive or distinctive in appearance to the
purchasing or using public may secure the protection
provided by this chapter upon complying with and
subject to this chapter.
(2) Vessel features.--The design of a vessel hull,
deck, or combination of a hull and deck, including a
plug or mold, is subject to protection under this
chapter, notwithstanding section 1302(4).
(3) Exceptions.--Department of Defense rights in a
registered design under this chapter, including the
right to build to such registered design, shall be
determined solely by operation of section 2320 of title
10 or by the instrument under which the design was
developed for the United States Government.
(4) Fashion design.--A fashion design is subject to
protection under this chapter.
(b) Definitions.--For the purpose of this chapter, the
following terms have the following meanings:
(1) A design is ``original'' if it is the result of
the designer's creative endeavor that provides a
distinguishable variation over prior work pertaining to
similar articles which is more than merely trivial and
has not been copied from another source.
(2) A ``useful article'' is a vessel hull or deck,
including a plug or mold, or an article of apparel,
which in normal use has an intrinsic utilitarian
function that is not merely to portray the appearance
of the article or to convey information. An article
which normally is part of a useful article shall be
deemed to be a useful article.
(3) A ``vessel'' is a craft--
(A) that is designed and capable of
independently steering a course on or through
water through its own means of propulsion; and
(B) that is designed and capable of carrying
and transporting one or more passengers.
(4) A ``hull'' is the exterior frame or body of a
vessel, exclusive of the deck, superstructure, masts,
sails, yards, rigging, hardware, fixtures, and other
attachments.
(5) A ``plug'' means a device or model used to make a
mold for the purpose of exact duplication, regardless
of whether the device or model has an intrinsic
utilitarian function that is not only to portray the
appearance of the product or to convey information.
(6) A ``mold'' means a matrix or form in which a
substance for material is used, regardless of whether
the matrix or form has an intrinsic utilitarian
function that is not only to portray the appearance of
the product or to convey information.
(7) A ``deck'' is the horizontal surface of a vessel
that covers the hull, including exterior cabin and
cockpit surfaces, and exclusive of masts, sails, yards,
rigging, hardware, fixtures, and other attachments.
(8) A ``fashion design''--
(A) is the appearance as a whole of an
article of apparel, including its
ornamentation; and
(B) includes original elements of the article
of apparel or the original arrangement or
placement of original or non-original as
incorporated in the overall appearance of the
article of apparel that--
(i) are the result of a designer's
own creative endeavor; and
(ii) provide a unique,
distinguishable, non-trivial and non-
utilitarian variation over prior
designs for similar types of articles.
(9) The term ``design'' includes fashion design,
except to extent expressly limited to the design of a
vessel.
(10) The term ``apparel'' means--
(A) an article of men's, women's, or
children's clothing, including undergarments,
outerwear, gloves, footwear, and headgear;
(B) handbags, purses, wallets, tote bags, and
belts; and
(C) eyeglass frames.
(11) In the case of a fashion design, the term
``substantially identical'' means an article of apparel
which is so similar in appearance as to be likely to be
mistaken for the protected design, and contains only
those differences in construction or design which are
merely trivial.
(c) Rule of Construction.--In the case of a fashion design
under this chapter, those differences or variations which are
considered non-trivial for the purposes of establishing that a
design is subject to protection under subsection (b)(8) shall
be considered non-trivial for the purposes of establishing that
a defendant's design is not substantially identical under
subsection (b)(11) and section 1309(e).
* * * * * * *
Sec. 1302(5). Designs not subject to protection
* * * * * * *
[(5)] (5)(A) in the case of a design of a vessel
hull, embodied in a useful article that was made public
by the designer or owner in the United States or a
foreign country more than 2 years before the date of
the application for registration under this chapter.
(B) in the case of a fashion design, embodied in a
useful article that was made public by the designer or
owner in the United States or a foreign country before
the date of enactment of this chapter or more than 3
years before the date upon which protection of the
design is asserted under this chapter.
* * * * * * *
Sec. 1303. Revisions, adaptations, and rearrangements
* * * * * * *
Protection for a design under this chapter shall be
available notwithstanding the employment in the design of
subject matter excluded from protection under section 1302 if
the design is a substantial revision, adaptation, or
rearrangement of such subject matter. Such protection shall be
independent of any subsisting protection in subject matter
employed in the design, and shall not be construed as securing
any right to subject matter excluded from protection under this
chapter or as extending any subsisting protection under this
chapter. The presence or absence of a particular color or
colors or of a pictorial or graphic work imprinted on fabric
shall not be considered in determining the protection of a
fashion design under section 1301 or 1302 or in determining
infringement under section 1309.
* * * * * * *
Sec. 1305(a). Term of protection
* * * * * * *
[(a) In General.--Subject to subsection (b), the protection
provided under this chapter for a design shall continue for a
term of 10 years beginning on the date of the commencement of
protection under section 1304.]
(a) In General.--Subject to subsection (b), the protection
provided under this chapter--
(1) for a design of a vessel hull, shall continue for
a term of 10 years beginning on the date of the
commencement of protection under section 1304;
(2) for a fashion design, shall continue for a term 3
years beginning on the date of the commencement of
protection under section 1304.
* * * * * * *
Sec. 1306(d). Design notice
* * * * * * *
(d) Fashion Design.--
(1) In general.--In the case of a fashion design, the
owner of the design shall provide written notice of the
design protection to any person the design owner has
reason to believe has violated or will violate this
chapter.
(2) Contents.--The written notice required under
paragraph (1) shall contain, at a minimum--
(A) the date on which protection for the
design commenced;
(B) a description of the protected design
which specifies how the protected design falls
within the meaning of section 1301(b)(8);
(C) a description of the allegedly infringing
design which specifies how the allegedly
infringing design infringed upon the protected
design as described under section 1309(e); and
(D) the date on which the protected design or
an image thereof was available such that it
could be reasonably inferred from the totality
of the surrounding facts and circumstances that
the owner of the allegedly infringing design
saw or otherwise had knowledge of the protected
design.
(3) Commencement of action.--An action for
infringement of a fashion design under this chapter
shall not commence until the date that is 21 days after
the date on which written notice required under this
subsection was provided to the defendant.
(4) Limitation on damages.--A person alleged to be
undertaking action leading to infringement under this
chapter shall be held liable only for damages and
profits accrued after the date on which the action for
infringement is commenced against such person under
paragraph (3).
* * * * * * *
Sec. 1309. Design notice
* * * * * * *
(a) Acts of Infringement.--Except as provided in subsection
(b), it shall be infringement of the exclusive rights in a
design protected under this chapter for any person, without the
consent of the owner of the design, within the United States
and during the term of such protection, to--
(1) make, have made, or import, for sale or for use
in trade, any infringing article as defined in
subsection (e); or
(2) sell or distribute for sale or for use in trade
any such infringing article.
(b) Acts of Sellers, Importers, and Distributors.--A
retailer, seller, importer or distributor of an infringing
article who did not make [or import] the article shall be
deemed to have infringed on a design protected under this
chapter only if that person--
(1) induced or acted in collusion with a manufacturer
to make[, or an importer to import] such article,
except that merely purchasing or giving an order to
purchase such article in the ordinary course of
business shall not of itself constitute such inducement
or collusion; or
(2) refused or failed, upon the request of the owner
of the design, to make a prompt and full disclosure of
that person's source of such article, and that person
orders or reorders such article after receiving notice
by registered or certified mail of the protection
subsisting in the design.
(c) Acts Without Knowledge.--It shall not be infringement
under this section to make, have made, import, sell, offer for
sale or distribute, any article embodying a design which was
created without knowledge either actual or reasonably inferred
from the totality of the circumstances that a design was
protected under this chapter and was copied from such protected
design.
(d) Acts in Ordinary Course of Business.--A person who
incorporates into that person's product of manufacture an
infringing article acquired from others in the ordinary course
of business, or who, without knowledge of the protected design
embodied in an infringing article, makes or processes the
infringing article for the account of another person in the
ordinary course of business, shall not be deemed to have
infringed the rights in that design under this chapter except
under a condition contained in paragraph (1) or (2) of
subsection (b). Accepting an order or reorder from the source
of the infringing article shall be deemed ordering or
reordering within the meaning of subsection (b)(2).
(e) Acts of Third Parties.--Acts that do not constitute
acts of infringement under subsections (a) or (b) do not
otherwise constitute acts of infringement under this chapter.
It shall be infringement under this section to be engaged in
(1) the provision of a telecommunications service, or
of an Internet access service or Internet information
location tool (as those terms are defined in section
231 the Communications Act of 1934 (47 U.S.C. 231)); or
(2) the transmission, storage, retrieval, hosting,
formatting, or translation (or any combination thereof)
of a communication, without selection or alteration of
the content of the communication, except that deletion
of a particular communication or material made by
another person in a manner consistent with section
230(c) of the Communications Act of 1934 (47 U.S.C.
230(c)).
[(e) Infringing Article Defined.--As used in this section,
an ``infringing article'' is any article the design of which
has been copied from a design protected under this chapter,
without the consent of the owner of the protected design. An
infringing article is not an illustration or picture of a
protected design in an advertisement, book, periodical,
newspaper, photograph, broadcast, motion picture, or similar
medium. A design shall not be deemed to have been copied from a
protected design if it is original and not substantially
similar in appearance to a protected design.]
(f) Infringing Article Defined.--
(1) In general.--As used in this section, an
'infringing article' is any article the design of which
has been copied from a design protected under this
chapter, or from an image thereof, without the consent
of the owner of the protected design. An infringing
article is not an illustration or picture of a
protected design in an advertisement, book, periodical,
newspaper, photograph, broadcast, motion, picture, or
similar medium.
(2) Vessel hull design.--In the case of a design of a
vessel hull, a design shall not be deemed to have been
copied from a protected design if it is original and
not substantially similar in appearance to a protected
design.
(3) Fashion design.--In the case of a fashion design,
a design shall not be deemed to have been copied from a
protected design if that design--
(A) is not substantially identical in overall
visual appearance to and as to the original
elements of a protected design; or
(B) is the result of independent creation.
([f]g) Establishing Originality.--The party to any action
or proceeding under this chapter who alleges rights under this
chapter in a design shall have the burden of establishing the
design's originality whenever the opposing party introduces an
earlier work which is identical to such design, or so similar
as to make prima facie showing that such design was copied from
such work.
([g]h) Reproduction for Teaching or Analysis.--It is not an
infringement of the exclusive rights of a design owner for a
person to reproduce the design in a useful article or in any
other form solely for the purpose of teaching, analyzing, or
evaluating the appearance, concepts, or techniques embodied in
the design, or the function of the useful article embodying the
design.
(i) Home Sewing Exception.--
(1) In general.--It is not an infringement of the
exclusive rights of a design owner for a person to
produce a single copy of a protected design for
personal use or for the use of an immediate family
member, if that copy is not offered for sale or use in
trade during the period of construction.
(2) Rule of construction.--Nothing in this subsection
shall be construed to permit the publication or
distribution of instructions or patterns for the
copying of a protected design.
* * * * * * *
Sec. 1310(a). Application for registration
* * * * * * *
(a) Time Limit for Application for Registration.--
[Protection under this chapter] In the case of a design of a
vessel hull, protection under this chapter shall be lost if
application for registration of the design is not made within 2
years after the date on which the design is first made public.
Registration shall not apply to fashion design.
* * * * * * *
1321. Remedy for infringement
* * * * * * *
[(a) In General.--The owner of a design is entitled, after
issuance of a certificate of registration of the design under
this chapter, to institute an action for any infringement of
the design.]
(a) In General.--
(1) Vessel hull.--In the case of a vessel hull, the
owner of a design is entitled, after issuance of a
certificate of registration of the design under this
chapter, to institute an action for any infringement of
the design.
(2) Fashion design.--In the case of a fashion design,
the owner of a design is entitled to institute an
action for any infringement of the design after--
(A) the design is made public under the terms
of section 1310(b) of this chapter; and
(B) the 21-day period described in section
1306(d).
(b) Review of Refusal To Register.--
(1) Subject to paragraph (2), the owner of a design
may seek judicial review of a final refusal of the
Administrator to register the design under this chapter
by bringing a civil action, and may in the same action,
if the court adjudges the design subject to protection
under this chapter, enforce the rights in that design
under this chapter.
(2) The owner of a design may seek judicial review
under this section if--
(A) the owner has previously duly filed and
prosecuted to final refusal an application in
proper form for registration of the design;
(B) the owner causes a copy of the complaint
in the action to be delivered to the
Administrator within 10 days after the
commencement of the action; and
(C) the defendant has committed acts in
respect to the design which would constitute
infringement with respect to a design protected
under this chapter.
(c) Administrator as Party to Action.--The Administrator
may, at the Administrator's option, become a party to the
action with respect to the issue of registrability of the
design claim by entering an appearance within 60 days after
being served with the complaint, but the failure of the
Administrator to become a party shall not deprive the court of
jurisdiction to determine that issue.
(d) Use of Arbitration To Resolve Dispute.--The parties to
an infringement dispute under this chapter within such time as
may be specified by the Administrator by regulation, may
determine the dispute, or any aspect of the dispute, by
arbitration. Arbitration shall be governed by title 9. The
parties shall give notice of any arbitration award to the
Administrator, and such award shall, as between the parties to
the arbitration, be dispositive of the issues to which it
relates. The arbitration award shall be unenforceable until
such notice is given. Nothing in this subsection shall preclude
the Administrator from determining whether a design is subject
to registration in a cancellation proceeding under section
1313(c).
(e) Pleading Requirement for Fashion Designs.--
(1) In general.--In the case of a fashion design, a
claimant in an action for infringement shall plead with
particularity facts establishing that--
(A) the design of the claimant is a fashion
design within the meaning of section 9
1301(b)(8) of this title and thus entitled to
protection under this chapter;
(B) the design of the defendant infringes
upon the protected design as described under
section 1309(e); and
(C) the protected design or an image thereof
was available in such location or locations, in
such a manner, and for such duration that it
can be reasonably inferred from the totality of
the surrounding facts and circumstances that
the defendant saw or otherwise had knowledge of
the protected design.
(2) Considerations.--In considering whether a claim
for infringement has been adequately pleaded, the court
shall consider the totality of the circumstances.
* * * * * * *
Sec. 1327. Penalty for false representation
* * * * * * *
Whoever knowingly makes a false representation materially
affecting the rights obtainable under this chapter for the
purpose of obtaining registration of a design or for purposes
of obtaining recovery based on a claim of infringement under
this chapter shall pay a penalty of not less than [$500] $5,000
and not more than [$1,000] $10,000, and any rights or
privileges that individual may have in the design under this
chapter shall be forfeited.
* * * * * * *
Sec. 1328. Enforcement by Treasury and Postal Service
* * * * * * *
(a) Regulations.--[The Secretary] In the case of designs of
vessel hulls protected under this chapter, the Secretary of the
Treasury and the United States Postal Service shall separately
or jointly issue regulations for the enforcement of the rights
set forth in section 1308 with respect to importation. Such
regulations may require, as a condition for the exclusion of
articles from the United States, that the person seeking
exclusion take any one or more of the following actions:
(1) Obtain a court order enjoining, or an order of
the International Trade Commission under section 337 of
the Tariff Act of 1930 excluding, importation of the
articles.
(2) Furnish proof that the design involved is
protected under this chapter and that the importation
of the articles would infringe the rights in the design
under this chapter.
(3) Post a surety bond for any injury that may result
if the detention or exclusion of the articles proves to
be unjustified.
(b) Seizure and Forfeiture.--[Articles] In the case of
designs of vessel hulls protected under this chapter, articles
imported in violation of the rights set forth in section 1308
are subject to seizure and forfeiture in the same manner as
property imported in violation of the customs laws. Any such
forfeited articles shall be destroyed as directed by the
Secretary of the Treasury or the court, as the case may be,
except that the articles may be returned to the country of
export whenever it is shown to the satisfaction of the
Secretary of the Treasury that the importer had no reasonable
grounds for believing that his or her acts constituted a
violation of the law.
(c) Nonapplicability.--This section shall not apply to
fashion designs protected under this chapter.
* * * * * * *
Sec. 1330. Common law and other rights unaffected
* * * * * * *
Nothing in this chapter shall annul or limit--
(1) common law or other rights or remedies, if any,
available to or held by any person with respect to a
design which has not been registered under this
chapter; [or]
(2) any right under the trademark laws or any right
protected against unfair competition[.], or
(3) any rights that may exist under provisions of
this title other than this chapter.