In the latter part of the previous year, I shone a spotlight on an eminent instance of a counterfeiting case, where things didn’t quite turn out as planned. This particular case involved Luke Combs, a renowned music artist and was centered around trademark issues. However, a method of litigation, now being widely recognized as Schedule A litigation, is increasingly emerging in context of design patents [1]. In fact, a couple of these cases, targeting Chinese firms selling to American consumers, were filed recently, highlighting the continuous harm to patent holders, which is arguably a significant contemporary driver of patent assertion.
Clarifying the definition of a Schedule A case, as outlined by Suffolk Law professor Sarah Burstein, they involve broad accusations against a large body of online vendors for infringing various Intellectual Property (IP) rights. These defendants are typically listed not within the complaint itself, but separately in an annexure, usually marked as ‘Schedule A’ [2]. Over time, a number of esteemed district courts, including NDIL, SDNY, and SDFL, have shown willingness to entertain such cases. Unsurprisingly, IP owners are keen to pursue these cases considering the dearth of practical alternatives to counter infringement by online sellers within an economically meaningful timeframe.
While initially Schedule A filings by IP owners were fundamentally focused on curbing the online sale of goods infringing on trademarks, as was the case with the Luke Combs debacle, the landscape began to shift around 2019. Around this time, Schedule A cases featuring allegations of design patent infringement began to surface. Coincidentally, around the same period, lawmakers started advocating for empowering Customs and Border Patrol agents to apprehend design patent infringements by allowing them to halt imports of infringing products without the necessity of an International Trade Commission exclusion order [3].
Burstein emphasizes the potentially harmful effects this trend might harbor, as liberal use of anti-counterfeiting language can influence adjudication of Schedule A cases in which no valid counterfeiting claim exists. Further complicating matter is the fact that many allegations brought forth in these cases are not particularly vigorous, and could even be labeled as trivial. She advocates for a more rigorous examination of Schedule A cases in design patent context by judiciaries, considering the intricate nuances involved in the adjudication of design patent claims [2]. The challenge echoes through even without the dramatizing language used by plaintiffs in pursuit of a swift victory.
Heeding Burstein’s warning, it’s high time that immediate steps are taken to curb the practice of misusing of the term ‘counterfeit’ by stakeholders on the design patent plaintiff side. Such misuse aims to evoke an impression of intentional wrongdoing where it is not applicable, thus disadvantageously affecting alleged infringers. A measured control on this behavior may benefit IP owners in the long run and, more urgently, provide relief to the accused [2].
Queries or comments are welcome at gkroub@kskiplaw.com.
Gaston Kroub, founding partner of Kroub, Silbersher & Kolmykov PLLC, a law firm focusing on IP litigation and Markman Advisors LLC, is a renowned consultant on patent matters for the investment community. His career has been predominantly centered on IP litigation and its associated counseling, with a specific emphasis on patent matters.
Follow him on Twitter: @gkroub