The U.S. Patent and Trademark Office has, for the first time, invalidated a design patent under a post-grant review process created by the America Invents Act.

The patent in question was assigned to children’s goods manufacturer Luv N’ Care Ltd. (who last July reached a $900,000 settlement, plus future royalties, in a separate lawsuit it filed against a Thai company it claimed had copied 16 of its designs) and covered the ornamental design of a particular sippy cup. The patent was challenged as “obvious” by Munchkin Inc. and Toys “R” Us Inc.

The ruling came in the first inter partes review initiated by USPTO for a design patent. The AIA created the inter partes review process as a replacement for inter partes reexamination. Since the creation of the inter partes reexamination process in 1999, there were only 13 re-exams filed for design patents (the first coming in 2004) representing only about 1 percent of total filings. But of those 13 re-exams, a somewhat shockingly high 47 percent of the challenged patents were ultimately canceled by an examiner from USPTO’s Design Patent Technology Center (the branch of USPTO that grants design patents.)

In place of the scrapped re-exam process, the AIA created a new Patent Trial and Appeal Board, a three-judge which conducts, as Elizabeth Ferrill and Anthony Tridico put it in a September 2013 article in CIPA Journal, “short, intense mini-trials” on two new types of challenges: post-grant reviews, which can be used to broadly challenge patents granted within the prior nine months and that were filed after March 16, 2013, and the aforementioned inter partes review, which can be used to challenge any existing patent, but only on grounds that prior art demonstrates the patent wasn’t novel.

The upside of the PTAB process, for all parties involved, is that it resolves disputes quickly and should significantly tamp down litigation costs for both petitioners and patent holders. There also remain some serious concerns, not the least being that PTAB judges won’t generally be expert in – and, indeed, may have very limited experience with – design patents. What’s more, the fact that design patents must be reviewed one claim at a time means the costs of review filings could really add up. Meanwhile, if a petitioner fails, he will be permanently barred from arguing in any future legal context that the patent wasn’t novel, even from using new arguments or evidence that were not introduced in the review process.

All of that really puts the pressure on any potential challenger to ensure they have an absolute airtight case before filing for inter partes. This ruling, at least, provides some hope that the process may work efficiently to strike down bad design patents that ought not to have been granted in the first place.

Images from the Love N’ Care filing can be found below:

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