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Friday, 13 May 2011

"Cry 'Havoc!' and let slip the pogs of war"

The long-awaited Registered Community design right-related opinion of Advocate General Mengozzi was delivered yesterday in Case C-281/10 P PepsiCo. This is the celebrated "pog" case, the background to which runs like this:

"10. ...Grupo ... filed an application .. for registration of a Community design in respect of goods described as ‘metal plate[s] for games’. ... The design is represented as follows:

Image not found

11. In the application, priority was claimed for Spanish design No 157098, for which the application for registration had been filed on 8 July 2003.

12. On 9 September 2003, PepsiCo... filed an application ... for registration of a design in respect of goods identified as ‘promotional items for games’. In relation to that application also, priority was claimed for a Spanish design ... for which the application for registration had been filed on 23 July 2003. That design is represented as follows:

Image not found

13. Both designs relate to small collectable children’s toys which are often distributed as free gifts inside the packaging of other products and known as ‘pogs’ (in Spanish, generally called tazos).

14. ... Promer filed an application with the Cancellation Division of OHIM ... for a declaration of invalidity in respect of the design registered by PepsiCo, claiming a conflict with its own prior design. ... [T]he Cancellation Division upheld the application and accordingly declared the design registered by PepsiCo to be invalid. According to the Cancellation Division, the two designs at issue bear similarities likely to produce the same overall impression on the informed user.

15. PepsiCo successfully appealed ... before the Board of Appeal. The Board of Appeal noted ... that, in assessing the overall impression conveyed by the designs at issue, it is necessary under the Regulation to take account of the degree of freedom available to the designer in developing the design. The Cancellation Division had taken the view that, in the case before it, the degree of freedom had been very extensive, because it had taken as a reference for comparison the entire range of possible promotional items, of which there are clearly a very great number. According to the Board of Appeal, on the other hand, reference should be made in the present case to the more limited category of ‘pogs’ (or tazos); consequently, since features such as the circular shape are ‘a must’ for such products, being a standard feature, the degree of freedom actually available to the designer is far more restricted than that taken into account by the Cancellation Division. In the light of those considerations, the Board of Appeal found that the – albeit limited – differences between the two designs at issue were sufficient to rule out the possibility that the designs would produce the same overall impression on an informed user. The Board of Appeal therefore annulled the decision of the Cancellation Division and confirmed the validity of the designed registered by PepsiCo.".
This time it was Promer's turn to appeal, which they did with some success:
"17. ... the General Court largely upheld the legal assessments made by the Board of Appeal. In particular, it confirmed that the concept of ‘conflict’ between designs ... implies that the designs produce the same overall impression on the informed user. It also confirmed that, for the purposes of ascertaining the designer’s degree of freedom, reference should be made, not to the entire category of promotional items, but to the particular category of ‘pogs’,  with the result that the actual freedom of the designer is somewhat constrained.

18. According to the General Court, however, even within the restricted confines of the creative scope available to the designer for developing new designs for ‘pogs’, it would have been possible for the design registered by PepsiCo to achieve a greater degree of distinctiveness as compared with the design registered by Promer:
‘79 ... the designs at issue both contain a concentric circle approximately one third of the way from the edge to the centre. ... [T]he Board of Appeal noted that similarity, stating that the circle was intended to convey the idea that the central part of the disc is raised slightly. However, the Court finds that the central part could have been delineated by a shape other than a circle. For it is apparent from the application for registration of the contested design, included in OHIM’s file forwarded to the Court, that the contested design claims the priority of a Spanish design ... which comprises three variants, and that the raised central part is, depending on the variant, delineated by a circle, a triangle or a hexagon. In addition, that finding cannot be called into question by the argument put forward by OHIM, at the hearing, that the shape had to be elementary in order not to distort the image which may cover the disc, since a triangular, hexagonal, or even a square or oval shape instead of a circular one would not have distorted the image any more. Furthermore, that finding cannot be called into question by OHIM’s argument that a circle had to be used so that the raised central part might be curved, because, inter alia, an oval shape could have been used. 
80 ... the designs at issue are similar in that the rounded edge of the disc is raised in relation to the intermediate area of the disc between the edge and the raised central area. 
81 ... the respective dimensions of the raised central part and the intermediate area of the disc, between the edge and the raised central part, are similar in the designs at issue’.
19. On the basis of the above findings, the General Court held the differences between the designs at issue to be insufficient to produce a different overall impression on the informed user  and accordingly annulled the decision of the Board of Appeal.".
PepsiCo then appealed to the Court of Justice of the European Union, whose Advocate General has just advised it to dismiss the appeal.

Writing for the Class 99 design law weblog, David Musker (Jenkins) explains that Advocate-General  view that observes at paragraph 35 that many of the grounds of appeal are really points of fact (which are not appealable to the Court of Justice). There's a certain symmetry here, in that the General Court appears to have substituted its own findings of fact for those of the Board of Appeal -- but two wrongs don't make a right [at least, they don't when they're outside the context of IP law in the European Union, muses Merpel]. This freedom is one which the General Court has exercised, to the obvious delight of successful appellants, in Community trade mark appeals, but it is also one which has a dubious legal basis within the context of the role of an appellate court being that of hearing appeals on law alone -- apart from which it encourages appeals, promotes uncertainty, and fills SMEs with dread at the prospect of how much time and money they have to expend in order to protect their position.

On a more positive note, the Advocate General has taken a robustly practical view as to the identity of that mythical beast, "informed user" of the design, who is to be considered (para. 74) as
"not a ‘technician’ with special knowledge, but just a user who is a little more attentive and interested than the average consumer: in other words, a user of whose perceptions the General Court is able to form an adequate picture".
Fellow Class 99 team member David Stone (Simmons & Simmmons), in an email circular, focuses first on another issue, that of whether a later design actually creates a different overall impression on the informed user than an earlier design which has been made available to the public.  He says, "the simple test of comparing the designs in a weighted comparison is to be applauded. The Advocate-General has sensibly avoided the position previously adopted by the Court of Appeal of England & Wales of trying to describe the overall impression in words".  Thus the Advocate General says:
"29.  The need to take account of the designer’s creative freedom arises because some features of the product to which the design relates are, so to speak, ‘compulsory’: as a result, the designer is not free to change them, and the fact that they bear similarities to the features of another design cannot be regarded as significant. To give an example, the fact that two kitchen table designs both envisage a table with four legs will not usually be a significant factor, because the fact of having four legs is a feature of the vast majority of standard kitchen tables. Where designs are characterised by significant constraints on the designer’s creative freedom, small differences may, generally, be sufficient to produce a different overall impression".
The IPKat awaits with interest the ruling of the Court of Justice knowing that, however helpful the words of the Advocate General might be, it's going to be the words of the Court itself, however unclear and fudged by compromise they may be, which will govern the key features of the informed user and overall impression in national and Community design law for a very long time.

Merpel says, these pogs must be really valuable if they're worth all the argument, hassle and expense of appeals. Or is the whole thing a matter of principle ...?

Other Pogs here and here
Pogo here
Julius Caesar here

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