Form Over Function – A Review of Recent Developments In Designs Law
Designs law has always struggled to reconcile competing interests and find the right balance between protecting form and/or function. The purpose of this paper is to consider the true philosophical underpinnings of design law and review the way it is developing. In doing so I will consider the overlap between copyright and designs and, designs and other forms of intellectual property rights. I will also consider how the legislatures and courts in the region have dealt with the question of protection for designs and make special mention of works of artistic craftsmanship.
Before discussing the topic, it is worthwhile to pause and reflect on what the general philosophy underlying the legal protection for designs might be. Lord Reid’s observation in AMP Inc v Utilux Pty Ltd is a good place to start. His Lordship defined the policy of the Act, (namely the then current British act) as being to: ‘preserve to the owner of the design the commercial value resulting from customers preferring the appearance of articles which have the design to that of those which do not have it’ and ‘Whatever the reason may be one article with a particular design may sell better than without it: then it is possible to use the design. And much thought, time and expense may have been incurred in finding a design which will increase sales’.
Lockhart J’s later comments in Dart Industries v Décor Corp are not too dissimilar. His Honour saw the essential purpose of the statutory scheme as to ensure that the owner was “rewarded for his inventiveness by exploiting the design commercially”. He saw other parallels:
“There are, of course, two associated purposes here. One, that of encouraging and rewarding invention by the proprietor of the registered design, exhibits and analogy with the law of patents. The other, preventing confusion between articles bearing the registered design and infringing articles, has common elements with common law principles as to passing off.”
The issues of parallels, overlaps and exclusions are central to this topic. I will expand on them below.
The policy underlying copyright protection is similar, but self evidently, not the same. Courts have set out the necessary criteria. A good practical insight can be found in Wham-O Mfg Co v Lincoln Industries . The guiding principles are:
1.To attract copyright, the author needs to impart some quality or character which the raw material did not possess;
2.The work need not be novel as long as it originates from the author and is not copied from another work; and
3.The objective is to prevent an infringer from appropriating (making unlawful use of) the labours of the author/owner.
In essence, copyright provides a means to protect time, effort and skill, in accordance with what a judge thinks is ‘fair’ and to prevent copying, whether direct or indirect.
I will endeavour to examine whether and if so to what extent these policy objectives are appropriate and arguably are being met. The difficulty with the whole issue is that the legislature and courts have tried to find a logical and holistic set of rules capable of protecting those designs into which thought, time and expense have been incurred and where sales have increased but where the “aesthetic quality” of the designs varies considerably.
At the heart of the problem is the need to devise a system which protects the most mundane but efficient functional designs; those designs that have distinctive visual features, or to use the time-honoured phrase “appeal to the eye” and those designs which express genuine artistic merit and professionalism. The law has tended to pigeon-hole these categories of design into those which are purely functional (mere mechanical devices), those which exhibit visible eye appeal and those which may genuinely be called works of artistic craftsmanship. However, the boundaries between these categories are unclear and some court decisions seem arbitrary and fickle. Others seem to overlook the need to reward thought, time and expense.
A cynical view might be that this area of the law has little logic and doctrinal purity should, in any event, give way to pragmatic solutions found by judges employing commercial sense and good instincts. However, others may argue that that is a charter for uncertainty and sound principle should not yield to commercial “necessity”.
To add to the dilemma, as is evident from comments in cases like Dart Industries, supra, some (but not all) courts have tended to borrow concepts from related areas. Some say this is an entirely appropriate process of legal rationalisation. Others suggest it simply adds to the uncertainty and indeed creates undesirable tension.
By way of background, under the New Zealand Copyright Act 1962, the courts had upheld copyright in a range of industrial designs, from the seemingly mundane (toilet systems) to the more refined (fashion garments). Many of these articles were also registrable as designs. Proprietors had the choice, without any significant downsides if one form of protection was favoured over the other. There were (and still are) few bright line exclusions.
The author of the chapter Registered Design in The Laws of New Zealand, comments at paragraph 4 that:
“…….while the number of patent applications and trade mark applications have continued to grow each year, design registration has not been overwhelmingly popular. This may be because the law is scarcely relevant to the needs of the designers it was intended to benefit, while general copyright law has been expanded and applied broadly and possibly in ways not intended by the framers of that statute.”
Nevertheless, (partly for doctrinal rather than practical reasons) the relationship between copyright and registered design rights was never a particularly comfortable one. In 1985 (following recommendations from the Industrial Property Advisory Committee (IPAC)) the law was changed to balance competing interests. The main changes were:
1.The effective term of copyright in 3-D works was reduced to 16 years;
2.Conversion damages was removed as of right; and
3.Expired/cancelled patents and registered designs could be copied.
This provided New Zealand with a system of regulated “dual” protection, which, in its essential form, remains in place today. It has however had its detractors, as Thomas J’s observations in Franklin Machinery Ltd v Albany Farm Centre Ltd, remind us. The case related to gate hardware, including gate gudgeons and hinge straps (hardly the most “artistic” of works). When discussing the plaintiff’s claim to copyright in these items of farm hardware, his Honour opined, rather tersely:
“The law relating to copyright has got quite out of hand. Claims for copyright protection are all too often raised and applied in circumstances which do not serve the objectives of copyright law. …
But I do not doubt that the legislative machinery in this country, and in the United Kingdom, has been used in the courts to go much further than was contemplated at the time it was applied to industrial designs and functional objects. Copyright has now invaded the field of technical design in a manner which has been dramatic. The most banal of industrial or technical drawings, which involve little more originality than that which accompanies many routine domestic tasks, has come to attract an aggressive claim to copyright protection. Frequently, the monopoly protection which the statute confers is out of all proportion to the degree of originality involved in producing the copyright work. …
Instead, the courts, lawyers, commentators and textbook writers have created a regime which no longer serves its legitimate purpose and is thought by many to operate to the detriment of the public interest.”
Having suitably chastised everyone, bar authors and proprietors of copyright, the Court concluded, somewhat floridly:
“Thus, there is little originality in reducing the commonplace to a clever drawing. The drawing is certainly original in the sense that it comes from the hand of the draughtsperson, but the originality is not substantial enough to attract copyright protection. A person could think that a drawing he or she made of a garden stake exhibited great originality if, by some fluke of experience, that person was unaware that garden stakes had previously been used since Adam and Eve tended the Garden of Eden.”
Perhaps what Thomas J had in mind was a stake similar to the “Z-post”, thereby anticipating Williams J’s conclusions in a judgment given a few months ago and which is discussed below,
What is more germane to this particular debate is that Thomas J did not consider the adjustments that had been made in New Zealand law, by giving industrial designs the maximum term of 15/16 years, regardless of whether they were protected by way of registered design or copyright. Some commentators certainly see this approach as a novel and ultimately effective compromise, which has accommodated competing interests in a way which is relatively simple to understand and apply.
Notwithstanding Thomas J’s criticisms, a few years later the Copyright Act 1994 was passed. It preserved the status quo, namely that applying under the Copyright Act 1962 as amended by the Copyright Amendment Act 1985.
It should also be mentioned that, whatever view one takes of the design/copyright interface, the Berne Copyright Convention applies to both works of art and applied art. There is a legitimate viewpoint that the distinction between “fine” and “applied” art is ultimately fruitless, particularly in a world where art, life and commerce often merge and are not easily distinguishable. It is thus perhaps understandable that New Zealand’s Copyright Act of 1962 did not exclude industrial designs from its ambit.
We should also not be too ready to dismiss the approach adopted in New Zealand. As Ken Moon points out:
“Moreover, the UK and New Zealand use of copyright or copyright-like concepts to protect design is more than just a “quick fix”. Copyright is the dominant intellectual property law model in the world today. In the era since Dorling v Honnor Marine  RPC 160 and the Copyright Act 1962 all countries, including the US and civil law countries, have adopted copyright as the principal means of protecting computer programs – a technology, not applied art.”
It is also interesting, when considering historical developments, to look more closely at the interrelationship between patents, designs and copyright. The early cases show that much of the debate about 100 years ago was over the relationship between patents and registered designs. Much of this centred on the issue of “utility”. Closely connected to this was the question of functionality. This is an area where the laws of New Zealand and Australia of course have diverged.
Historically, the test centred on whether a particular design was in substance a “mere mechanical device” or offered something “over and above the fundamental form” of the article. This is a topic in itself. Space does not permit further discussion here. The decision of the Full Federal Court in Hosokawa Micron International Inc v Fortune, provides a thorough overview.
The distinction between patent and design concepts is not always clear. For example, as Puri in discussing the designs regime, points out:
Registration is not merely declaratory of property in a design; it is the basis of ownership. It should be noticed that the patent approach prevails in the sense that property in a design is based on registration. As a result, the design provisions are analogous to provision on patents.
We find in the cases, practical application of this statement. For example, evidence of the commercial success of the applied design may be material in determining the novelty or originality of the design, as long as the design itself has created the success. Harvey & Co Ltd v Secure Fittings Ltd.
Russell-Clarke supports this approach and Fellner notes that:
“If there is doubt, commercial success may be taken as an indicator that the public has found something eye-appealing about the design.”
Again, this concept seems to have been adopted from the law of obviousness, where commercial success, while having a bit of a chequered career, has always been a consideration which can be taken into account in deciding whether an invention is genuinely inventive rather than the result of clever sales and marketing.
Again, to illustrate the cross-fertilisation (or muddying) of ideas, even though proof of copying is not required to establish design infringement, if a defendant copies a plaintiff’s design, the court is entitled to take it into account, as evidence tending to show that the design is novel.
Further, in considering novelty and eye appeal, the trade mark doctrine of imperfect recollection has also been adopted. This requires the designs to be considered not only side by side but separately and assuming some time to have elapsed, to simulate ordinary conditions of commerce.
The practical reality therefore is that designs overlap with most forms of intellectual property and the copyright/design overlap is not unique.
Copyright in 3 D Industrial Works
While some courts and commentators have doubted its correctness, the leading New Zealand industrial copyright case, remains the decision of the Court of Appeal in Wham-O, supra. It is well settled that in order to succeed in an action it needs to be shown that there is sufficient objective similarity between the works/products and a causal connection existed between the defendant’s and the plaintiff’s works.
Generally, the New Zealand courts have readily affirmed the notion that copying is wrong and in the nature of theft. However, in the industrial designs area, more recently the Court of Appeal has itself pulled back a bit from the high water mark in the mid 80’s. In Beckmann v Mayceys Confectionery, the Court held that there was not enough objective similarity to sustain infringement even though there was clear evidence of a causal link. In effect, the Court concluded that proof of causal connection does not raise any prima facie evidence of objective similarity. This can be contrasted to the previous approach, which often saw courts having regard to “objective similarity” and “causal link” as opposite sides of the same coin.
That said, the relationship between objective similarity and causal link and the proper approach to gauge “copying” is not without difficulty. It seems that the weight given to access and evidence of copying will remain matters for the trial judge and consciously or not influence the decision on similarity.
The Court of Appeal in UPL Group Ltd v Dux Engineers Ltd stated that the test for infringement of a registered design is:
-A question of fact of which the eye is the judge…
-……whether the article alleged to be an infringement has substantially the same appearance as the registered design.
In assessing whether the design is novel and whether the article alleged to be an infringement has ‘substantially the same appearance as the registered design, the court is also likely to apply the traditional ‘squeeze’ approach. This means that it will look at the relationship between the degree of novelty or originality of a registered design and the issue of infringement.
In Beckmann, when considering copyright (rather than design) infringement, the Court of Appeal adopted the registered design ‘squeeze’ approach, even though it did not refer to it by name. It looked at features which were common to the trade and essentially pegged back the breadth of the copyright. We thus again see principles developed in one area of the law being used in other analogous areas.
Review of Recent Designs Cases in New Zealand
In the past few months an unprecedented number of registered design cases have been considered by the New Zealand High Court. Whether this is simply coincidental or indicative of some change is unclear at the moment. It does however seem that overall the profile of registered designs is on the increase.
Allegations of invalidity almost invariably arise when intellectual property rights are asserted. While various presumptions of validity apply, they are not always treated consistently. Likewise, questions of onus often arise. In some situations the issue can be important if not determinative. At the interim stage for example, the onus may rest on a defendant to establish that, notwithstanding a breach, an injunction should not be granted.
In Eveready New Zealand Ltd v Gillette New Zealand Ltd Elias J (as she then was) found that in order to succeed the defendant needs to show a clear defence. A serious defence was raised – the defendant questioning whether the plaintiff was entitled to the registered design at all. Even so, on this and the question of novelty, her Honour found that the matter was only arguable and needed to await determination at trial.
In this regard, there is some similarity in the positions in New Zealand and Australia. This is evident from Heerey J’s decision in World Brands Management Pty Ltd and Others v Cube Footwear Ltd and Others.. His Honour noted that the case based on design infringement was answered by the proposition that where there is a serious challenge to a recently registered design no interlocutory injunction should be granted. In doing so, his Honour relied on authority going back to the 1920’s.
Recent Interim Injunction Decisions
Before looking at the more recent decisions, it is worth mentioning two decisions, where interim injunctions were granted. The first is Handitags Ltd v Warburton. The Court placed considerable weight on whether damages would be an adequate remedy and the fact that it was a registered design, providing a ‘practical monopoly’. The Judge also found that it would be difficult to manage the practical monopoly situation.
The second is BEP Marine Ltd v Aquatech Marine Ltd. Here the Court accepted that the validity of the design was a matter requiring assessment, in determining whether there was a serious question to be tried. However, the Judge concluded that the potential vulnerability of the registration, while detracting from the strength of the case put forward by the plaintiff, did not lead him to conclude that there was no serious issue to be tried. His Honour noted the difficulty of managing the “practical monopoly” and found that the status quo favoured the plaintiff, because the defendant was not yet on the market.
On the basis of these cases, it seems that in New Zealand, unless a defendant can raise a significant validity issue at the outset that an interim injunction is likely to issue. The status is an important consideration. If the defendant is not yet on the market or agrees to withdraw the product, either long-term or until trial, the status quo is likely to point towards the need for interim relief.
Of the more recent cases, the first again involved an application for an interim injunction – Robinhood Australia Pty Ltd v Aquatica NZ Ltd. The plaintiff sought to restrain the defendant from making or distributing a laundry tub, until trial. The tub allegedly infringed a patent, registered design and copyright – (a good example of dual protection, in fact). The allegations related to the design of a waste water disposal system and a console, where the washing machine and laundry tub taps were located. The defendant changed the design of its waste water disposal system but not its console. The question was whether an interim injunction should be granted.
Of relevance here, the Court concluded that there was a serious question to be tried in relation to the design of the end caps. However, having so found, the Court then considered that the balance of convenience favoured the defendant. That is, on the basis that the alleged breach of registered design related solely to the console of one model which the plaintiff had evidently taken off the market.
This suggests that on conventional interim injunction analysis, the registered design served its purpose and that if the plaintiff had not taken its product off the market, an interim injunction would probably have been granted. That said, it is, with respect, difficult to see why enforcement of a monopoly right should depend on whether the registered proprietor is on or off the market.
The next case is Bruce Sutton v Bay Masonry Ltd. It progressed in a rather unusual manner. The plaintiffs were the proprietors of a New Zealand registered design for a so-called “Z-post”; essentially a metal stake used for fencing. They sued the defendants for design infringement. The defendants alleged that the Design was invalid. The proceeding went to trial on the rectification claim alone. It was tried on the affidavits, without cross-examination.
Counsel agreed that the law was conveniently summarised in Conrol Pty Ltd v Meco McCallum Pty Ltd. The trial judge, Williams J quoted at length from Conrol, essentially adopting the passage, as he put it, largely “shorn of cited authority”.
The Court referred to, inter alia, the leading decision of the House of Lords in Amp v Utilux Pty Ltd and later to the speeches of Lord Reid and Lord Morris of Borth-y-Gest in relation to the question of “functionality”. His Honour then referred to the New Zealand decision in Mono Pumps (NZ) Ltd v Amalgamated Pumps Ltd.
In Bruce Sutton His Honour conflated various tests and stated that:
“Whether the Z-post appeals to the eye’s judgment, whether its shape is dictated by its function and whether it is new or original, can all be dealt with together.”
He put the question slightly differently in the next paragraph, summarising the question as whether “its appeal lies more in its shape than its usefulness or vice versa”. He then distinguished the Z-post from the pump in the Mono Pumps’ case, concluding that:
“The shape of the Z-post would appear to be only what is functionally needed or only what is there to “make the article work” relying on Amp, supra at 110.”
The Judge then concluded that the Z-post did not appeal to the eye and it was dictated solely by function. These conclusions seem sound, given the obvious functionality of the object. It is also difficult to imagine anything more practical than a metal stake and what real eye appeal the design might have had or indeed how or why such appeal might have been intended.
Where however, with respect, the Learned Judge might have gone too far is in looking at the prior art. He states:
“The evidence of the patent available on line from the Australian Patents Office is unpersuasive in this regard since it illustrates a shape significantly different from the Z-post but it seems likely to have been accessible from New Zealand before 29 November 2000.”
If the Australian patent he refers to was simply “available” on line from the Australian Patents Office, it would not properly quality as admissible prior art in my view. Having said this, it is not exactly clear from the judgment whether there was indeed adequate proof of the patent being actually (rather than notionally) received in New Zealand before the priority date of 29 November 2000.
Section 5(2) of the Designs Act reads:
Subject to the provisions of this Act, a design shall not be registered there under unless it is new or original and in particular shall not be so registered in respect of any article if it is the same as a design which before the date of the application for registration has been registered or published in New Zealand in respect of the same or any other article or differs from such a design only in immaterial details or in features which are variants commonly used in the trade. (emphasis added)
It is clear from the section that New Zealand has local novelty requirements. Normally, publication means when the article in question was first offered or made available to the public. Overseas events are thus not relevant unless it can be shown that the relevant ‘knowledge’ reached New Zealand and was communicated to the public in the necessary manner.
In my view, the availability of a document held in another country accessible via the Internet does not necessarily make that document ‘published’ in New Zealand. The analogy of a document or textbook held in a library in another country and available by inter-loan from that library is apt. I would suggest that unless the document or textbook had been obtained via inter-loan and actually received in New Zealand before the relevant date, it could not be considered to have been ‘published’.
I would also suggest that a party relying on overseas art needs to establish, through reliable evidence, that the prior art relied on had actually been accessed by someone in New Zealand before the relevant date, as opposed to simply being capable of being accessed. Otherwise, the local novelty requirements under the Designs Act would, in effect, be negated.
Policy considerations are involved. One way of looking at it is that the author of a design in New Zealand is not penalised by being denied the fruits of his/her labour merely because someone in a different country came up with the same design.
This adherence to the concept of “local novelty” may seem a little quaint and antiquated. Possibly it is, particularly in the Internet age. That however, for better or worse is the position, until altered by Parliament.
One of the passages extracted by Williams J from Conrol is that:
“For a design to be registrable under the Act it must be more than a mere trade variant which any skilled workman might make” and that “what constitutes a variant commonly used in the trade is a question of fact. The trade variant must be one commonly known and used in connection with a particular article or class of article”.
On its face, the passage seems innocuous enough. However, there might be more to it than meets the eye. On appeal, in Conrol Pty Ltd v Meco McCallum Pty Ltd, the respondents argued in support of the cross-claim that the Trial Judge had impermissibly “made a mosaic” of items of prior art. The Full Court upheld the first instance decision and said that it is not necessary to identify one particular earlier article which deprives the design in suit of novelty or originality. They also found that the Learned Trial Judge was entitled to rely on the fundamental form of the product (conveyors) to make his decision.
Thus, in Australia it seems to be permissible to combine references and to rely on essentially an “obviousness” type approach to invalidate a design. If the effect of adopting Conrol (and thereby possibly other like decisions) into New Zealand law is to allow this to occur, it would be a development not necessarily contemplated by the Court and one I would not welcome (and indeed the traditional).
It seems that, arguably, a better (and indeed the traditional) approach is to require each piece of prior art to be considered on its merits, as with anticipation/lack of novelty. I say this because the question being addressed in the design context is that of novelty; not obviousness.
The obviousness-type approach has not, to my knowledge, been adopted in a designs case in New Zealand. Nor has it found favour in the United Kingdom. For example, in Dennis Carr & Anor’s Application, Whitford J said:
“I think the question of obviousness must be approached with some care, because in considering the question of obviousness practitioners in the design field may well come to equating the issue of obviousness in the design field with the sort of issue which is considered in the patent field. …
I think it is fair to say upon the basis of this judgment [Clarke’s Registered Design (1896) 13 RPC 351 at 361] that if you can find novelty or originality then you could not, in Lopes LJ’s view, find obviousness. It is important in cases of this kind that citations should not be taken in part only and possibly out of context, because they may lead to the introduction of ideas which are wholly foreign to the Act.”
It will be interesting to see if things change, following William J’s decision.
The most recent designs case in New Zealand involves the Australian company Permanent Promotions and the large New Zealand liquor company, Independent Liquor. What makes the dispute of interest is that interim relief was sought on both sides of the Tasman, but the courts reached different conclusions, granting interim relief in New Zealand but declining it in Australia. Why was this so?
The product in dispute is a trendy new “ready-to-drink” alcoholic beverage, comprising two liquors in a twisted shot glass with a sealed top. The registered designs were the same in both countries. In both countries the defendants were about to launch a competitive product. Time was of the essence.
In Permanent Promotions Pty Ltd v Independent Liquor (NZ) Ltd the New Zealand High Court granted an interim injunction restraining the defendants from selling or promoting products which infringed the plaintiff’s registered design.
Heath J employed a traditional approach and found that given the similarity between the products that the plaintiff was entitled to rely on the registration and the prima facie right granted under the Designs Act.
The defendants argued that the Design was invalid as it comprised features of shape or configuration dictated solely by the function that the article to be made in that shape or configuration must perform. They relied on the Privy Council decision in Interlego AG v Tyco Industries Inc.
The New Zealand Court found, in effect, that while the defendants had raised a good argument, the balance still lay in favour of the registered proprietor and the presumption of validity.
The New Zealand approach can be compared to the one adopted in Australia by Heerey J in Permanent Promotions Pty Ltd v Independent Distillers (Aust) Pty Ltd.
Heerey J stated:
“It was submitted that the respondent has deliberately and with “eyes wide open” chosen to enter the Australian market and run the risk of an infringement action, and that this should weigh heavily against it. I do not accept this. Where a firm has a genuine belief on reasonable grounds that a rival’s intellectual property is invalid or that a rival’s product may be contested with a non-infringing product, there is no reason why that firm should not enter the rival’s market. “
This approach differs to the one adopted by Heath J in New Zealand; where he stated:
“In my view the fact of registration confers a prima facie right sufficient to overcome the hurdle of establishing that a serious question exists to be tried. The onus on a defendant who counterclaims, in a situation such as that, is heavy. The evidence adduced by Independent Liquor must go so far as to persuade me that the prima facie rights attaching to registration must be overlooked because of the strength of the defendant’s counterclaim. That test is consistent with observations made by Elias J in Eveready NZ Ltd v Gillette NZ Ltd (High Court, Auckland, M1130/98, 28 August 1998) at 15. That is the test I apply in this case.”
Heerey J stated:
“Bearing in mind again the short period to trial, which of course is the only period relevant for present purposes, the observation can be made that the applicant has been in business since 1983 and has managed to survive the vicissitudes of business life in Australia since then. Although the twisted shot glass is a new and thus far very successful product, I am not persuaded that the entry of a rival product on the market for a few months will have the catastrophic effect forecast by the applicant.”
“Other things being equal, the shorter the period to trial, the less willing a court should be to grant an interlocutory injunction, which is always a significant interference with what a party might otherwise be entitled to do.”
Once again, the New Zealand approach was quite different. Having found that the balance of convenience was in a state of “equipoise”, Heath J held that:
“On the basis that those protections formed the foundation for an interim injunction [namely provision of security] the relatively short time until the case can be readied for trial and the prima facie nature of the protections afforded on registration, I concluded that the overall interests of justice favoured making an interim injunction on strict terms.”
Therefore, leaving aside the question of the provision of security, the Australian Court felt that an early trial militated against granting interim relief, while the New Zealand Court took the opposite view, and considered that it was a factor in favour of granting interim relief of a relatively short period.
It might be suggested that the real difference between the two situations is that in New Zealand suitable security was offered whereas the same was not done in Australia. However, the two decisions might reflect a deeper difference, going to the fundamental approach adopted by our respective courts when considering monopoly rights. It seems that the Australian courts are more likely to give weight to validity arguments than their counterparts in New Zealand and that the New Zealand courts are more likely to give the registered proprietor the “benefit of the doubt” at least at the interim injunction stage.
I suggest that these two decisions reflect what appears to be contrasting approaches to the granting of interim injunctions in patent and design cases. That said, in Permanent Promotions there were other factual and legal difference between the two proceedings and I hesitate to draw any conclusions from just one set of proceedings. I do however consider that a wider analysis of the cases might bear out what I am suggesting.
Finally, while I accept that the new provision in the Australian Designs Act 2003 allowing for registration without substantive examination has its merits, it does have some downsides. For example, requiring examination before enforcement of a design could create difficulties for registered proprietors who seek urgent interim relief.
Substantive Law Differences
While not the focus of this paper, it is always necessary to bear in mind the differences in the law between Australia and New Zealand. In Permanent Promotions, the different treatment of the issues of local novelty and functionality were apparent.
While not specifically raised in the case, “eye appeal”, is another possible point of difference. The eye to which appeal must be made and which is to judge is not the eye of the court but the eye of the customer. In New Zealand, the ‘eye’ is the eye of an informed ordinary customer of the article in question. The court should thus not be expected to substitute its impression for that of relevant consumers.
However, in Australia the emphasis is on the eye of the court, though the difference may be theoretical – see for example Firmagroup Australia v Byrne.
Examination Practice in New Zealand
In Permanent Promotions Heath J. took the unusual step of directing that the decision be served on the Commissioner of Designs and that he appear at trial to explain the practice adopted by IPONZ in examining designs. This followed a criticism at the hearing of the designs regime and the assertion that there was a lack of any real substantive examination in New Zealand. The defendants therefore argued that the Court should place little reliance on the registration. Heath J was concerned by this submission, hence the direction for the Commissioner to appear at trial.
It seems that if a defendant is able to argue that all a registered design gives the proprietor is the ability to assert that it is registered and no more, it would be a most unfortunate position. In particular, it would be a backward step if a very low level of examination of registered designs allowed defendants to attack the traditional presumption of validity, particularly at the interim stage.
The Judge’s direction did not go unnoticed. A process of consultation had been occurring between IPONZ officials and members of the Institute of Patent Attorneys. The direction seemed to expedite matters because on 16 July 2004 a meeting was held between IPONZ officials and members of the Institute of Patent Attorneys.
The Permanent Promotions case has since settled. Even so, it is hoped that the Court’s intervention will lead to positive change. One change that has occurred since 1 July is that examination of registered designs, which was previously a function of technically qualified examiners at IPONZ, (but has more recently been done by trade mark examiners) has now been returned to technical examiners. It is felt by some commentators that requiring trade mark examiners to examine registered design applications was not the best approach and this is a welcome change.
IPONZ has also been at pains to explain that it is not correct to say that there is a lack of real substantive examination of designs in New Zealand and that while the system could be improved some of the criticisms are unjustified.
To conclude, when one looks at these developments, it seems that registered design law is no longer the poor cousin of intellectual property law. It is certainly demanding a bit more of the limelight in both Australia and New Zealand. I suggest this is likely to continue.
“Artistic craftsmanship” is experiencing something of resurgence in Australia. The only case in which it has been fully considered in New Zealand in recent years is Bonz, supra. The case related to a range of hand knitted woollen sweaters and cardigans which had a range of animals in sporting poses, including dancing lambs and golfing kiwis.
The garments are brightly, indeed garishly, coloured. They are handmade, as are the buttons on the cardigans. The garments are made by outworkers who contract knitted the garments according to the plaintiff’s (Bonz) specific designs.
In the related “knitwear” case, Coogie Australia Pty Ltd v Hysport International Pty Ltd & Ors, Drummond J found that Coogie had copyright in the first run of its XYZ fabric in the particular colour selection first adopted by it and possibly in the other seven colourways in which it subsequently produced the fabric. However, the Court found that Coogie did not have copyright in the subsequent runs of fabric and in respect of the garments made from that fabric.
In Bonz the plaintiff sought to rely on copyright in its garments as prototypes or models. However, the Court rejected this approach, on the basis that it had not been addressed in the pleadings, opening submissions or evidence. In the result, the plaintiff had to rely solely on the works being works of artistic craftsmanship.
In terms of a subsequent finding that the plaintiff’s garments were indeed works of artistic craftsmanship, Tipping J concluded that:
“In the end the Court must make its own assessment of the work in question assisted by whatever evidence has been produced on the point.
I have some difficulty with the proposition that an author can have tried to be artistic and failed, yet the product, because this was the intention of the author, is nevertheless to be regarded as a work of artistic craftsmanship. I consider that the end result objectively viewed must have a significant bearing on the question. That is not to make the Court an arbiter in comparative terms of the merits of an allegedly artistic product. It simply recognises that for a work to be one of artistic craftsmanship it must, in my judgment, have some artistic qualities. …
At the risk of being regarded as being unduly simplistic I am of the view that for a work to be regarded as one of artistic craftsmanship it must be possible fairly to say that the author was both a craftsman and an artist. A craftsman is a person who makes something in a skilful way and takes justified pride in their workmanship. An artist is a person with creative ability who produces something which has aesthetic appeal.”
His Honour concluded that two or more people could combine to design and make the ultimate product; an approach subsequently adopted in Coogie (supra). This does however lead to an interesting question. Tipping J concluded that the hand knitters could fairly be described as “craftsmen”. What is not however apparent from the judgment (in Sheldon v Metrokane, Conti J noting, in relation to the manufacturing/knitting process, that: “That sort of detail does not appear from the reasons for judgment in Bonz.”) is that they were in reality people working from home, knitting garments according to a predetermined and relatively simple knitting chart or blueprint. In essence, they were “knitting by numbers” and reproducing endless quantities of identical garments, without any creative input to speak of. The question arises as to whether this type of activity warranted the tag craftsman or more properly ‘craftsperson’?
In Sheldon v Metrokane, supra, Conti J disagreed with these findings. In relation to the involvement and supervision of the making of the relevant work, he noted that:
“I would add that there may well be difficulty, in the light of this Court’s decision in Coogie, in accepting today that the circumstances in Bonz were sufficient to justify the element of craftsmanship in relation to manufactured goods. The nature and extent of the findings in Bonz do not readily compare, on my reading of the reasons for judgment, with the nature and extent of the input of Mr Walker into the manufacturing process in Coogie, as found by Drummond J.”
Another question that arises is just what is required to establish infringement of a work of artistic craftsmanship. Even if we assume that the plaintiff’s garments were sufficiently professional and striking, the Judge was of the view that the defendant’s garments were not. For example, Tipping J portrayed Mrs Cooke’s lambs as “rather crudely portrayed” and at the same page characterised her small clothed kiwi as striking “a rather unnatural pose”. When considering the question of objective similarity the Court noted that Mrs Cooke’s garments were “rather pallid and amateurish in their appearance” and that these differences went beyond “a question of bad copying”.
His Honour did of course conclude that the defendant’s garments bore little, if any, resemblance to the plaintiff’s garments. It is thus not surprising that he concluded that infringement had not been made out. The question that might however arise is whether a defendant, who consciously seeks to copy a work of artistic craftsmanship but fails miserably to do so, can be found to have infringed? Put another way, does an infringement of a work of artistic craftsmanship itself have to meet the relatively high standards of both art and craftsmanship?
One way of looking at Tipping J’s conclusion is that, even if, for argument’s sake, Mrs Cooke had set out to copy the Bonz garments, in terms of an objective assessment, she failed to do so. On this basis it would seem that she would have a defence to infringement of an artistic work (for example a model) and that being the case certainly a defence in relation to a work of artistic craftsmanship.
Further, arguably once copyright has been found to subsist in a work of artistic craftsmanship it would not need to be shown that the alleged copy was of the same artistic quality. For example, a crudely made and mass produced article would reproduce the copyright work, regardless of the process adopted. However, I suppose it does raise a possible defence, namely that a copy has to “look like a copy” and if the copier fails to achieve their purpose, they would not be an infringer. That is, because absent objective similarity, infringement cannot be established, even if there is an obvious causal connection. In this regard see Gault P’s comments in Beckmann.
Another recent Australian decision illustrates how difficult it can be to determine whether a work is indeed a work of “artistic craftsmanship”. In Swarbrick v Burge the issue arose in relation to a hand-crafted model of a,yacht – known as the “JS 9000”.Copyright was said to reside in a range of works including a handcrafted plug, moulds, mouldings made from the moulds, a number of drawings and the yacht itself. The applicant, a designer and naval architect, said that he had created the plug without extensive reference to existing drawings and that this involved a high level of manual skill and that the ability to do so was gained from many years of experience and training.
The Court found that the plug was a sculpture within the meaning of s10(1) of the Australian Copyright Act, being in the same category as the wooden models of the frisbees which the New Zealand Court of Appeal had held were sculptures.
This finding led to the next question: whether the plug was also a work of artistic craftsmanship. The respondents argued that the applicant’s work on the plug was that of a “tradesman not of a craftsman producing a work of artistic quality by his craftsmanship”. This submission was rejected, the Judge stating that:
“I find that the applicant had special training, skill and knowledge in both the design skills of a naval architect and the design and manual skills of an experienced shipwright. In my view, he applied much of that special training, skill and knowledge when he produced the plug. The plug is a manifestation of pride in sound workmanship and the result of the exercise of skill on the part of the applicant in using the wooden materials from which the article was made.”
The Judge also rejected the respondent’s argument that the design of the yacht was functional. In so doing Carr J adopted the statement in paragraph 9 of the principles explained by Drummond J in Coogie “that the antithesis between function and beauty is a false one”.
Finally, the Court rejected the argument that because the work was an artistic work it could not be a work of artistic craftsmanship. This conclusion must be right as copyright has always recognised different categories of works and accorded them different levels of protection.
Eye Appeal v Aesthetic Appeal
As noted in Bonz, a work of artistic craftsmanship must have some artistic quality and produce some aesthetic appeal. However a registered design need simply ‘appeal to’ and be ‘judged solely by the eye’ – Interlego.
Likewise, in AMP v Utilux, Lord Morris indicated that the features did not need to be ‘artistic’ nor appeal to every person’s eye, stating:
“This does not mean that the “appeal” or the “attraction” must be to an aesthetic or artistic sense – though in some cases it may be. The features may be such that they gain the favour of or appeal to some while meeting with disfavour of others. Beyond being merely visible the feature must have some individual characteristic. It must be calculated to attract the attention of the beholder”. (emphasis added)
The test is whether any effect on the eye is present, independent of subjective feelings which are aroused by this effect. This requirement is much less demanding than being required to show that a work is a work of artistic craftsmanship. Likewise, the test to establish the originality of a prototype or model is of a similar level of difficulty, which helps explain why fewer New Zealanders have felt the need to claim that their products are works of artistic craftsmanship.
Conclusion regarding works of artistic craftsmanship
Over the years, parties’ efforts to rely on works of artistic craftsmanship have not fared particularly well. One only has to look at the plaintiff’s failure to obtain protection for its set of coloured rods in Cuisenaire v Reed and the hooded baby cape in Merlet v Mothercare PLC to realise that the test for subsistence is a strict one. In New Zealand, in Crystal Glass Industries Ltd v Alwinco Products Ltd, it was held that an aluminium caravan window was not a work of artistic craftsmanship. The plaintiff was however successful on other grounds.
In the clothing vein, designers continue to have their claims rejected, as illustrated more recently in the United Kingdom in Guild v Eskander Ltd where Rimer J denied the claim for a range of garments inspired from ethnic or peasant dresses, even though they had received critical acclaim in fashion circles and had been exhibited at no less than the Victoria and Albert Museum.
Likewise, in Sheldon v Metrokane, supra, Conti J followed the same course, noting in passing that Coogie’s victory was a “pyrrhic” one. So, one might add, was Bonz’s.
He then concluded that the Rabbit corkscrew was not a work of artistic craftsmanship.
During argument, counsel for Sheldon referred to the copyright/design overlap protection provisions in Australia as enigmatic. Perhaps they are and a regime which requires proprietors to argue that essentially utilitarian articles like teaching aids, capes and corkscrews are akin to works of art is indeed enigmatic.
In Bonz the plaintiff suffered much the same fate. However, that was not because it was necessary to rely solely on the garments being works of artistic craftsmanship. That I suggest is where the true difference lies. The New Zealand approach is inclusive. Some commentators see this as having advantages. On the other hand, the Australian approach, pre and post 17 June 2004, seems to be more technical and essentially exclusive.
The tensions, the need to try and anticipate judicial sensibilities and the resulting uncertainties were noted by Colin Golvan SC when he stated:
“Invariably, the issue of judicial sensibility comes to bear upon the resolution of key issues in the determination of whether a work satisfies the requirements of the description “artistic craftsmanship”. This raises real difficulties in seeking to anticipate outcomes. The distinction between aesthetic design and aesthetic craft work (as identified in Sheldon and further considered in Swarbrick) is not an easy one to define.
And then, as illustrated by Coogi, once a work is accepted to be a work of artistic craftsmanship, there is a real difficulty in application, having regard in particular to the changes in visual appearance which might result in such a work being held not to have been infringed. Of course, none of this is sought to be resolved by the new Designs legislation, and these issues remain as vexed as ever, with all sorts of tensions coming into the area of protection of artistic craftsmanship by reason of the use of “new” technologies and the presence in the community of very diverse senses of artistic sensibility.”
He then concluded, in referring to the new Australian Designs Act that:
“The change signals a shift in the relatively lenient approach afforded to protection to date for designs based on the plan to plan analysis which was evident in the Muscat v. Le decision, towards a much more formulistic approach which is bound to leave many designers feeling under-protected and possibly under-rewarded for their efforts as “authors” in the copyright sense. A harsher environment for the protection of three-dimensional artistic works has emerged out of a recent period in which rights claimants have sought what has turned out to be only temporary comfort in the relatively sheltered waters of the pre-17 June 2004 approach to copyright protection.”
Proposals for Reform in New Zealand
Various proposals for reform have been made, firstly by the Department of Justice and then the Ministry of Commerce. The introduction of the Copyright Act 1994 interrupted these efforts. However, in December 1995 the Ministry of Commerce released a Position Paper, which included the earlier proposed three-tiered system (providing for copyright, an unregistered design right and registered design protection with varying terms) but also suggested that the current position may be retained.
Thus, at the present time, it is difficult to predict whether official thinking is directed to significant change, or simply retention and slight modification of the status quo.
Recent enquiries with IPONZ do not suggest any major developments are being planned for now.
It is also unclear whether the introduction of the Designs Act 2003 in Australia will have a bearing on things in New Zealand. One would have thought that having regard to our mutual obligations under CER, (namely greater harmonisation of our business laws) that increased liaison and an attempt to harmonise would occur. However, from an objective viewpoint, it is hard to see any significant harmonisation, at least at a substantive law level. I am certainly unaware as to whether Australia considered adopting the New Zealand copyright/designs approach. Whether it was felt that the New Zealand approach had little to commend or whether Australia simply did not look this way, is an answer others are more qualified to give.
Looking at the situation from the outside in, it seems that in Australia the latest effort to find a compromise between copyright and designs may have added another layer of complexity, but not necessarily left Australian designers much better off. The concern I have is that designers, particularly sole operators or those from small organisations, often have an incomplete understanding of the law. The new designs regime in Australia may well disadvantage them further.
As to whether the aim of protecting the “commercial value” of good design, recognising the “thought, time and expense” associated with it and “rewarding inventiveness” is satisfied, time will tell.
When recent developments in the region are considered it is difficult to conclude that the true philosophical basis of designs law is agreed upon or necessarily understood. There seems to be little real uniformity between Australia and New Zealand’s designs law. This makes it difficult for companies and firms operating in the region to understand and apply the law. The result is uncertainty and difficulty for both Australian and New Zealand enterprises: Australian enterprises because they think they can copy industrial designs relatively freely in Australia and do the same in New Zealand; New Zealand enterprises because they think they can rely on copyright to protect their industrial designs in Australia when this is not always the case. The law is thus disadvantaging business people on both sides of the Tasman.
In Australia, it seems that the narrow window of opportunity that works of artistic craftsmanship provided has now been closed. Business people in the fashion industry in particular are now back where they started from. This might be good for copiers and cut price operators but not for genuine/innovative designers. This, it seems, applies to designers in both countries who wish to get some level of protection for good design.
Having said that, it seems that New Zealand has adopted a simpler and more efficient designs model and I would argue that while Australia has tried on many occasions to fix its problems in the design law field it might benefit, even if just slightly, from a look in this direction.
20 February 2005