Successful Enforcement of ‘Tool Wallet’ Design Patent Highlights Both Strategic Importance of Design Patents AND Risk of Haphazard Use of External Design Firms

On September 12, 2025, the Federal Circuit issued a nonprecedential decision in Dynamite Marketing, Inc. v. The WowLine, Inc. (Sherman Specialty), affirming a jury verdict that upheld the validity of Dynamite’s design patent for the “Wallet Ninja” multi-tool, confirmed Sherman’s willful infringement, and sustained an award of $1.85 million in lost profits plus attorney’s fees and interest—totaling more than $3.5 million. The court dismissed Sherman’s appeal on inventorship grounds and rejected its challenges to obviousness, functionality, infringement, and damages.

Case Insights

For technology entrepreneurs, the case underscores two key insights:

• Design patents can be powerful assets when strategically scoped. Here, the patent did not claim the entire “tool wallet” but only selected portions of its ornamental appearance. That choice matters: by carving out only the distinctive visual features, the patent owner avoided tying protection to purely functional aspects that competitors could easily design around. This claim strategy expanded the patent’s reach—making it harder for infringers to escape liability by making small cosmetic tweaks. In practice, this shows how careful drafting can transform a design patent from a narrow shield into a broad competitive moat.
• Inventorship and assignment must be nailed down early—and recorded. Sherman argued that the patent was invalid because a subcontracted engineer should have been named as a co-inventor. While the court rejected that argument, the dispute highlights a common pitfall: subcontractors (e.g., designers) and vendors (e.g., prototyping shops, factories) often contribute to product development — unless their rights are explicitly assigned, ownership can be clouded. Although many contractors will provide you a standard non-disclosure agreements, this case is a reminder that assuming you own the design is very risky. The lesson isn’t just “get a signature”—but to ensure that: 1) actual invention assignment agreements are executed before work begins, 2) that they clearly cover all IP created in the course of the engagement, and 3) that the assignment is recorded with the USPTO. Recording is critical: without it, later purchasers or licensees may not be protected, and the assignee’s ownership rights can be vulnerable in disputes. Even a weak inventorship claim can become a costly distraction if the paperwork isn’t airtight and properly filed.

In short, the Wallet Ninja case shows both how design patents, when carefully drafted, can generate real business value, and also how proactive IP housekeeping—including timely, recorded assignments—can prevent expensive disputes down the road.

Practical Takeaways for Entrepreneurs

• When filing design patents, claim only the ornamental features that make your product distinctive. This can significantly broaden your protection and deter close copycats.
• Lock down inventorship and assignment agreements before work starts with contractors, consultants, collaborators, and vendors.
• Record all assignments with the USPTO to safeguard ownership and avoid downstream disputes.
• Treat patents not just as legal shields but as business assets—capable of driving exclusivity, licensing revenue, and litigation leverage.

Securing and strategically managing patent rights is not only a defensive measure but also a direct pathway to monetization—whether through exclusivity in the marketplace, licensing, or damages recovery.

For guidance on protecting and monetizing your innovations, please contact a relevant member firm of Synchrony IP.