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USRE38782

The patent covers a blanket with fabric loops sewn on the edges, as shown in the following image:

Image of patented blanket

The commercial product is called "Taggies".

Priority date is late 1999. Seems like there's likely some good prior-art, given the simple design and the late priority date.

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For a prior art search, you could check out "baby blank" utility or design with a priority date before Dec 2, 1999. Look for ones that are lapsed or have priority date > 20 years old. Interestingly, the TAGGIES utility patent lapsed for non-payment in 2014. https://www.google.com/patents/US6427265

One problem is, once you find prior art, the cost to invalidate the design patent will be enormous. It will be more cost effective to design around the patent. The design patent specifically refers to colorful LOOPS. If you make a colorful non-loop on a blanket, you should be fine. The "non-loop" could be a knot, a fringe, a tag, lace, braid etc.

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