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 @e7f76f0d That's quite an article - I only just skimmed the highlights, but it sounds like you're not a fan of the overuse of "counterfeiting" to obtain extraordinary relief for garden variety infringement claims.

And from the definition you provide of design patent infringement, it seems questionable that flags look the same. I wonder if they'd have any easier time with copyright? 
 @abb65a6d That's a pretty good summary of my article!

And as for this case, the complaint doesn't allege patent infringement but if they claimed the whole design of the flag then you'd be right: Not close enough to infringe.

As to copyright, the complaint avers that the plaintiff has "copyrighted images and photographs" but doesn't actually allege copyright infringement, perhaps because there is also no mention of any copyright registration or rejected registration application (prereqs to suit) 
 @e7f76f0d @abb65a6d and I would be surprised AT ALL if the "copied" seemingly identical images used as components are actually stock or public domain images, so the only thing plaintiff could claim would be a very thin argument for the arrangement, which isn't even precisely copied