Sears, Roebuck & Co. v. Stiffel Co.

Background

Stiffel Company, which created and sold a distinctive "pole lamp," sued Sears after Sears sold nearly identical lamps at lower prices. Stiffel claimed patent infringement and, under Illinois law, unfair competition because customers were confused about the source. The district court found Stiffel's patents invalid, but concluded Sears had copied the lamp and that customers were likely confused; it enjoined Sears and awarded damages. The court of appeals affirmed the unfair-competition finding, and the case reached this Court to decide whether Illinois law could bar copying of an unpatented article.

Reasoning

The Court addressed whether a State may, by its unfair-competition law, forbid copying of a product that federal patent laws leave unprotected. The Court explained that the Constitution gives Congress power to set national patent rules and that when an article is unpatentable or a patent has expired the article belongs to the public. Allowing a State to prevent copying of an unpatented design would conflict with federal policy and effectively give perpetual monopoly beyond federal limits. The Court held states may not prohibit copying of an unpatented article, though they may require labeling or protect trademarks to prevent deception.

Real world impact

Because the ruling bars state laws from stopping copying of unpatented products, sellers and manufacturers may make and sell unpatented designs without fear of state-based injunctions or damages for mere copying. Consumers may benefit from lower prices and greater choice. The decision leaves room for states to regulate misleading packaging or to protect trademarks, but it prevents states from creating de facto patent-like protection for unpatented articles.