The district court’s sole finding with regard to St. John’s assertion of invalidity was that the design was not dictated by its function because “[t]he testimony revealed [that] there are a multitude of ways to arrange different sizes of labels on an 8 1/2" x 11" sheet.”

“Whoever invents any new, original and ornamental design for an article of manufacture may obtain a patent therefor, subject to the conditions and requirements of this title.” 35 U.S.C. § 171 (2006). As the statute indicates, a design patent is directed to the appearance of an article of manufacture. L.A. Gear, Inc. v. Thom McAn Shoe Co., 988 F.2d 1117, 1123 (Fed. Cir. 1993). “If the patented design is primarily functional rather than ornamental, the patent is invalid.” Power Controls Corp. v. Hybrinetics, Inc., 806 F.2d 234, 238 (Fed. Cir. 1986). The design of a useful article is deemed to be functional when “the appearance of the claimed design is ‘dictated by’ the use or purpose of the article.” L.A. Gear, 998 F.2d at 1123; see also Rosco, Inc. v. Mirror Lite Co., 304 F.3d 1373, 1378 (Fed. Cir. 2000).

“[T]he determination of whether the patented design is dictated by the function of the article of manufacture must ultimately rest on an analysis of its overall appearance.” Berry Sterling Corp. v. Pescor Plastics, Inc., 122 F.3d 1452, 1455 (Fed. Cir. 1997). Our cases reveal a “list of . . . considerations for assessing whether the patented design as a whole—its overall appearance—was dictated by functional considerations,” including:

whether the protected design represents the best design; whether alternative designs would adversely affect the utility of the specified article; whether there are any concomitant utility patents; whether the advertising touts particular features of the design as having specific utility; and whether there are any elements in the design or an overall appearance clearly not dictated by function.

Id. at 1456 (emphasis added). In particular, we have noted that “[t]he presence of alternative designs may or may not assist in determining whether the challenged design can overcome a functionality challenge. Consideration of alternative designs, if present, is a useful tool that may allow a court to conclude that a challenged design is not invalid for functionality.” Id. “When there are several ways to achieve the function of an article of manufacture, the design of the article is more likely to serve a primarily ornamental purpose.” Rosco, 304 F.3d at 1378.

Our case law makes clear that a full inquiry with respect to alleged alternative designs includes a determination as to whether the alleged “alternative designs would adversely affect the utility of the specified article,” such that they are not truly “alternatives” within the meaning of our case law. Id. In this case, while the district court relied exclusively on its finding that there were a multitude of alternative designs, the court did not make any findings with respect to whether any of the alternatives would adversely affect the utility of the medical label sheet.

[T]he district court makes no reference to St. John’s evidence that the overall arrangement of the labels on the medical label sheet was dictated by the use and purpose of the medical label sheet and that alternative designs lacking that arrangement would adversely affect the utility of the sheet. Specifically, St. John presented Mr. Press’s affidavit, in which he stated:

The labels for use on the wristbands themselves are located on the bottom two rows of the sheet as these are usually the first labels used when a patient is admitted to a medical facility. The lower right hand corner is the easiest location for a right-handed user to remove the label as it is flush to an edge and unencumbered by a file or binder clip along the top or left hand margins. By placing the labels for the wristbands at the bottom of the page, the subsequent removal of additional labels adjacent to the removed label is facilitated.

(Press Aff. ¶ 5.d.)

Mr. Press’s affidavit constitutes evidence that alternative designs, which do not include the “novel feature” of PHG’s design - the placement of various sizes of medical labels at the bottom of the sheet - would adversely affect the utility of the medical label sheet. It articulates a clear functional reason why the use and purpose of the article of manufacture dictated that the “wristband” labels be located at the bottom of the sheet. Additionally, PHG’s statements during prosecution of the ’425 utility application indicate that there were functional reasons for each of the other features of the medical label sheet, including: for creating one sheet containing labels of different sizes; for the particular sizes of each differently-sized label; for the size of the sheet itself; and for including holes along the side and top of the sheet.

While a district court’s determination as to whether a design is primarily ornamental is reviewed for clear error, in this case there is no explicit finding by the court on whether the alleged alternatives are in fact functionally equivalent (i.e., that the alternatives do not adversely affect the utility of the medical label sheet), or any mention or finding whatsoever with respect to the evidence presented in Mr. Press’s affidavit. The evidence presented by St. John, in our view, was sufficient to raise a substantial question of invalidity. The only evidence presented by PHG and relied upon by the district court was Mr. Moyer’s testimony that he and his co-inventor chose the patented designs because they had “the best flow and look.” PHG did not offer testimony refuting the assertions made in Mr. Press’s affidavit - that functional considerations dictated the medical label design, specifically the “novel feature” of the differently-sized labels being placed at the bottom of the sheet. In fact, on cross-examination Mr. Moyer testified that the original intent in designing a medical label sheet with differently-sized labels was “functional.”

St. John’s evidence thus directly pertains to, and is sufficient to raise a substantial question with respect to, whether the overall appearance of the patented designs is “dictated by” the medical label sheet’s use and purpose. Because St. John has satisfied its burden of raising a substantial question of invalidity, the district court’s finding that PHG was likely to show that the patented designs were primarily ornamental is clearly erroneous.

Because we find that St. John has raised a substantial question of the validity of the two patents at issue, the district court abused its discretion by granting PHG’s motion for a preliminary injunction. Therefore, we vacate the preliminary injunction.