IP Law Daily, PATENT—E.D. Wisc.: Drinking in the dark: In a case over a lighted cup holder, the parties fight to a draw, (Nov 8, 2021)

By Matthew Hersh, J.D.

Some of the patent and trade dress claims could be presented to a jury, but the remainder would not survive summary judgment.

A common theme of marriage, perhaps more of a cliché than a day-to-day reality, is that couples even fight over the cup holders (in cars and movie theaters alike). Since the year 2018, a different type of cup holder battle—this one involving patent and trademark claims—has taken place in a federal courtroom in Milwaukee. In a decision handed down on Friday, the federal judge overseeing that case gave each party something to lament (Raffel Systems, LLC v. Man Wah Holdings Ltd., Inc., November 5, 2021, Joseph, N.).

The case involves a number of patents held by Raffel Systems, a Wisconsin-based manufacturer of electronic systems for a variety of industries. One of the company’s line of products, which it labels as “comfort solutions,” involves a range of technologies that can be installed in home or movie theater seats and control such disparate functions as “power recline, headrest motion, heat, massage, lights, cooling cupholders or lighted cupholders.” The patents at issue in this case—three utility patents and two design patents—involve the latter of these, namely lighted cupholders.

The litigation arose when the holder of these patents sued a competitor—a Hong Kong-based company named Manwah—for utility and design patent infringement, trade dress infringement, and false marketing. The claims, summarized generally, involved allegations that the Hong Kong competitor made and distributed “knock off” versions of the patented cup holders. The two parties filed a wide range of summary judgment motions, leading to this opinion.

Utility patent infringement. The court delivered a mixed ruling on the patent holder’s infringement claims. As to the flange of the cup, the claim could not survive summary judgment. In a patent infringement case, the question is whether the accused product “contains elements identical or equivalent to each claimed element.” There was not literal identity here because the patent, as construed by the court, covered only a “non-removable” flange, while the competitor’s flange was removable. To be sure, the court reasoned, the mere fact that the flange could be removed by brute force was not enough: “If an object needs to be physically destroyed in order to ‘remove’ a part, the part is not ‘removable’ in the ordinary sense of the word.” But here a destructive force was not necessary—the flange could be disassembled with a simple screwdriver. This was sufficient to rebut identity. Nor were the two cup holders equivalent under the law, as the differences between the two were substantial. Expert testimony showed that a removable flange “allows manufacturers or users to customize the look of the cup holder to better fit with the exterior of the seating unit.” That was enough to defeat the claim.

The same did not go for the lighting mechanism of the cup holder, however. Each cup holder contains a “light source”—a light bulb or some other source of light, essentially—and a translucent “lighted element” that forms a visible ring around the cup. But the claim was limited to a lighted element that was “operatively connected to” the light source. Did this describe the accused product? To be sure, the testimony conflicted over whether the light source made physical contact with the lighted element. But the word “operative,” the dictionary reveals, can mean “exerting force or influence.” Whether or not there was physical contact, the court reasoned, the competitor’s lighted element was the recipient of just such a force or influence—"specifically, by receiving light from the light source to illuminate the receptacle.” The accused product therefore fell within the bounds of the patent, and the jury could hear the claim.

Design patent infringement. While the utility patent claims could partially go forward, the design patent claim could not. The claim at issue involved the ornamental design of the patent holder’s cup holder, as set forth in one of its design patents. Federal Circuit precedents teach that a design patent is infringed “if, in the eye of an ordinary observer, giving such attention as a purchaser usually gives, [the] two designs are substantially the same.” The test could not be met here. To be sure, both designs had an upper flange made up of a circular ring, with a “concentrically extending portion” over one-third of the flange. But the flange was noticeably dimpled in the accused product, whereas it was smooth in the patented design. And when the cup is embedded in its holder, the court reasoned, the flange is “the main portion of the cup holder the customers see.” The designs were therefore plainly dissimilar.

False marketing. Turning to the last of the patent issues, the court held that the false marketing claim could proceed. The claim here was that the competitor used patent numbers and other markings of the patent holder on competing products. To get to trial on the claim, the patent holder would have to show that the competitor intended to deceive and that the deception caused injury. As to intent, this was easy: a reasonable jury could surely believe that the markings were placed on the cup holder to convince the public that they were the original product. The evidence of injury was also sufficient to go forward. The patent holder’s expert report plainly showed lost profits, the court observed, and any questions about whether he sufficiently linked those losses to the false marketing was for the jury to determine.

Trade dress claims. Just as with the patent claims, the court delivered a mixed ruling on the trade dress claims. Most of the trade dress claims survived—namely those asserting trade dress infringement, common law misappropriation, and related unfair competition claims. To go forward with these claims, the patent holder must identity the trade dress of the product with specificity and show that the original was either inherently distinctive or had acquired secondary meaning. The question of specificity was easily resolved. The complaint identified the color pattern and shape of the cup holder, the precise design and placement of the label, and even the font on the inscription, among others. This was enough. As to whether the patent holder’s product had acquired a secondary meaning—any argument of inherent distinctiveness was disclaimed—this was a closer call. Ordinarily, the best proof of secondary meaning is customer surveys, but the patent holder had none. And while the patent holder plainly had a record of advertising its product generally, there was no evidence of advertising that entailed “an attempt to identify the product’s features with the product’s source.” But the complaint was saved, the court reasoned, by the fact that customers contacted the patent holder when having problems with the competitor’s products. This was enough to let the jury decide.

The same could not be said for the trade dress dilution claim, however. To prevail on this claim, the patent holder would have to show that its trade dress was “famous” in the eyes of the public. The evidence of this fell short. To be sure, the patent holder had significant sales and was well known generally in the furniture world. But the company “pointed to nothing in its advertising showing its trade dress was touted, nor did it provide any evidence of actual broad recognition of the trade dress.” For these reasons, the court concluded, the claim could not go forward.

The Case is No. 2:18-cv-01765-NJ.

Attorneys: David A. Casimir (Casimir Jones SC) and John C Scheller (Michael Best & Friedrich LLP) for Raffel Systems LLC. Clark Bakewell (Mayer Brown LLP) and Hao Tan (Arch & Lake LLP) for Man Wah Holdings Ltd. Inc. and Man Wah [USA] Inc.

Companies: Raffel Systems LLC; Man Wah Holdings Ltd. Inc.; Man Wah [USA] Inc.

Cases: Patent Trademark WisconsinNews GCNNews