From October 2016 to March 2017 the team is joined by Guest Kats Rosie Burbidge and Eibhlin Vardy, and by InternKats Verónica Rodríguez Arguijo, Tian Lu and Hayleigh Bosher.

Friday, 20 June 2014

CJEU rules on unregistered design: overall impression and presumption of validity

For every 150 trade mark rulings, it seems, the Court of Justice of the European Union (CJEU) issues a decision on designs [a topic which is far less investigated than trade marks, and far more ignored by the IP community and Luxembourg Courts]. One of these rare design rulings happened yesterday, with the CJEU issuing its decision in Case C‑345/13 Karen Millen Fashions Ltd v Dunnes Stores (Limerick) Ltd, a reference for a preliminary ruling from the Supreme Court of Ireland [on the Advocate General's opinion see Jeremy’s post here]. This decision concerns the way to assess a design's overall impression and the sensitive issue of burden of proof of an unregistered design's validity. Here's how the story went.

Karen Millen Fashions made and sold clothing for women, including a striped shirt and a black knit top. In 2005 Dunnes, a major retail chain in Ireland, made copies of Karen Miller’s garments and, in 2006, started selling them under its "Savida" label. In 2007 Karen Millen brought proceedings against Dunnes in the Irish High Court, claiming infringement of an unregistered Community design under the Community Design Regulation 6/2002 (CDR).

Dunnes admitted copying the garments and conceded that the garments were new. However, it challenged the validity of Karen Millen’s unregistered Community design on the basis that it lacked "individual character". Apparently, Dunnes’ assumed that Karen Millen’s designs were nothing but the combination of features drawn from a number of earlier designs, such as a grey Dolce & Gabana knit top and a Paul Smith blue striped shirt. Further, Dunnes alleged that it was for Karen Millen to prove that the its unregistered Community designs had individual character.

The Irish High Court granted Karen Millen’s claims. Dunnes then appealed to the Supreme Court, which decided to stay the proceedings and seek guidance from the CJEU as to:

1.        The way in which prior art should be addressed when assessing individual character and, in particular, whether the overall impression should be considered by reference to any individual design or any combination of known design features drawn from more than one such earlier design.

2.      The burden of proof for unregistered designs to be considered valid and, in particular, whether the right holder is supposed to merely indicate what constitutes the individual character of the design or obliged to prove that the design has individual character.

As to the first question, the CJEU established that

“Article 6 of Council Regulation ... 6/2002 ... on Community designs is to be interpreted as meaning that, in order for a design to be considered to have individual character, the overall impression which that design produces on the informed user must be different from that produced on such a user not by a combination of features taken in isolation and drawn from a number of earlier designs, but by one or more earlier designs, taken individually”.

In this regard, the CJEU stressed that nothing in the wording of the CDR (Article 6) supports the view that the overall impression referred to in it must be produced by a combination of features drawn from different designs. By contrast, under that provision the overall impression is produced on the informed user by "any design" made available earlier, not by a pastiche of different elements taken from a number of non-connected appearances.

This conclusion is not called in question by Article 25(1) of the TRIPS Agreement, according to which “Members may provide that designs are not … original if they do not significantly differ from known designs or combinations of known design features”. Indeed, saud the Court, that TRIPS provision is merely optional, and the EU legislator opted not to require originality of a design to be assessed in comparison with such combinations. Consequently, the Court concluded, 
“the assessment as to whether a design has individual character must be conducted in relation to one or more specific, individualised, defined and identified designs from among all the designs which have been made available to the public previously”.
As to the second question, the CJEU acknowledged that Article 85(2) CDR lays down a presumption of validity regarding of unregistered Community designs. Under that provision, holder of unregistered design is entitled to benefit from such presumption provided that

(a)   He or she proves that the design at issue "meets conditions laid down in Article 11 CDR", which the CJEU considered to be the mere disclosure of the design to the public;

(b) He or she indicates what constitutes the individual character of the unregistered Community design at issue.

As to the first condition, Article 11(1) CDR reads that 
“a design which meets the requirements under Section 1 shall be protected by an unregistered Community design for a period of three years as from the date on which the design was first made available to the public within the Community”. 
The fact that such provision makes reference to Section 1 CDR, the Court said, does not mean that a right holder shall provide evidence that all the conditions laid down in Section 1 [and, among other things, individual character requirement] are met. Indeed, such an interpretation would be utterly incompatible with the presumption of validity and it would render meaningless and nugatory the possibility for the defendant to challenge design's validity under Article 85(2), second sentence.

Burden of proof for Dunnes
By contrast, the Court continued, Article 85(2) CDR has to be read in light of the lack of registration formalities that characterizes unregistered Community design. In this regard, the absence of a proper design certificate leads to the obligation for the right holder to identify the date from which the design is protected. Under Article 11 CDR, the protection kicks off on “the date on which the design was first made available to the public within the Community”, and that very event is all Articles 85 and 11 CDR require the right holder to prove when they make reference to “Section 1”.

The absence of registration formalities, the Court continued, also makes it necessary for the holder of the unregistered design to specify what he or she wishes to have protected. Article 85(2) CDR requires right holder to do so by merely identifying the features of the design that give it individual character. In other words, the unregistered design holder is required to indicate what constitutes the individual character of the design [eg, stressing the original features that he or she believes deserving protection], not to prove that the latter meets that requirement [no priority research is in order, and it is up to the claimant for invalidity to demonstrate the invalidity of the design].

Accordingly, the CJEU concluded that
“the answer to the second question is that Article 85(2) of Regulation No 6/2002 must be interpreted as meaning that, in order for a Community design court to treat an unregistered Community design as valid, the right holder of that design is not required to prove that it has individual character within the meaning of Article 6 of that regulation, but need only indicate what constitutes the individual character of that design, that is to say, indicates what, in his view, are the element or elements of the design concerned which give it its individual character”. 

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