Ford F150

Auto makers may be gnashing their teeth about paying license fees for standard-essential patents that connect cars to the internet. But now it looks as if they'll be able to recoup some of those IP costs by protecting replacement auto parts with design patents.

The Federal Circuit on Tuesday turned away a replacement part trade group's bid to limit the reach of design patents on hoods, headlamps and other parts that serve both a functional and ornamental purpose.

The upshot of Automotive Body Parts Association v. Ford Global Technologies is that if consumers need replacement hoods or headlamps that look exactly like the one on an F-150, they would either have to buy from Ford or from parts makers who have paid a license. The decision was issued under seal earlier this month and made public Tuesday.

ABPA had argued that design considerations for replacement parts are primarily functional in nature and therefore not subject to design patents. “The only role that design plays in an owner's decision to buy such a part is that the design must match the design of the original part to return the vehicle back to its original condition and appearance,” ABPA's attorney, Robert Oake Jr. of Oake Law Office had argued in briefs to the court.

Alternatively, he argued that the original sale of the F-150 should exhaust Ford's design patent rights.

The Federal Circuit disagreed on both counts Wednesday. “We hold that, even in this context of a consumer preference for a particular design to match other parts of a whole, the aesthetic appeal of a design to consumers is inadequate to render that design functional,” Judge Kara Stoll of the U.S. Court of Appeals for the Federal Circuit wrote for a unanimous panel.

Judges Alvin Schall and Todd Hughes concurred.

ABPA had tried to analogize to a case in which the Federal Circuit held that a design patent on a key blade was unpatentable. “That was done in an effort to control the market for replacement keys, just like Ford is trying to control the market for repair parts,” Oake told the court at a January hearing.

“But that's the consequence of getting a patent on something,” Judge Todd Hughes had replied. “If it's patented, other people can't make or manufacture or sell it, absent a license.”

In Tuesday's opinion, Stoll wrote that the key case turned on the fact that no alternatively designed blade would mechanically operate the lock—“not that the blade and lock were aesthetically compatible.” Plenty of alternative headlamp and hood designs will fit Ford's trucks, even if they don't look exactly like the original.

As for exhaustion, that covers only the parts sold with the original truck, not replacements. ABPA had asked the Federal Circuit to modify that rule for design patents, but Stoll declined. “Our precedents do not differentiate transactions involving embodiments of patented designs from those involving patented processes or methods,” she noted.

Hogan Lovells partner Jessica Ellsworth had the winning argument for Ford Global Technologies. At the January hearing she had analogized to a Federal Circuit case involving design patents on surgical instruments. “The fact that doctors may prefer a certain arrangement of the buttons and the setup of that surgical instrument doesn't make it functional if in fact other designs serve the exact same useful purpose,” she told the court. “And that, I think, puts an end to what the ABPA is arguing here.”