Design Patent Infringement: Implications for Covered Advertising Claims

In The Limited v. Nationwide Insurance Co., Ohio Court of Common Pleas, Franklin County, Case No. 94CVH11-8405, the issue of design patent infringement and its intersection with advertising injury coverage under an insurance policy was at the forefront.

The case revolved around the sale of the fruit legging product, where Nationwide Insurance Co. disputed whether potential liability for patent infringement could trigger coverage under the policy’s provisions for misappropriation of an advertising idea.

Key Legal Issues in The Limited Case

The case hinged on whether allegations of design patent infringement could qualify as a covered advertising injury claim. Specifically, Nationwide argued that patent infringement claims were excluded from coverage, while The Limited asserted that because the alleged wrongful conduct involved the promotion and sale of the infringing product, it fell within the policy’s language covering misappropriation of an advertising idea.

The case was ultimately resolved favorably following the pursuit of a motion for summary judgment on the design patent claims. The court’s evaluation focused on whether advertising elements were central to the alleged infringement, which would determine whether coverage was triggered.

Implications of the Court’s Decision on Design Patent Infringement

This case underscores significant points regarding design patent infringement and insurance coverage for advertising claims:

1. Advertising Injury Coverage Can Be Implicated – If a claim of patent infringement includes allegations related to marketing or advertising, insurers may be required to provide coverage.

2. Policy Language Matters – The interpretation of policy terms, such as misappropriation of an advertising idea, is crucial in determining whether a claim falls under coverage.

3. Potential Coverage Triggers – The court’s focus on the advertising component of the infringement claim suggests that businesses should assess whether their policies provide protection against IP-related claims.

Notable Takeaways for Businesses and Insurers

For businesses, this case highlights the importance of reviewing commercial liability policies to determine whether they provide protection against design patent infringement claims that involve advertising elements. Companies should ensure that their policies are tailored to their industry’s risk exposure.

For insurers, the decision emphasizes the need to clearly define the scope of advertising injury coverage and to assess whether policy exclusions explicitly apply to design patent claims. Insurers should be prepared for arguments that patent-related disputes involving marketing efforts may trigger coverage obligations.

Final Thoughts on Design Patent Infringement

The The Limited v. Nationwide Insurance Co. case sheds light on the evolving landscape of design patent infringement claims and their implications for insurance coverage. As courts continue to assess the boundaries of advertising injury provisions, businesses and insurers alike must stay informed about policy language and legal precedents.

If your company is facing a design patent infringement dispute or requires legal guidance on advertising injury coverage, contact Gauntlett Law for experienced advice on navigating complex IP and insurance matters.