A recent decision of the European Court of Justice sheds new light on the unregistered design right that exists in the European Union and may make Canadians envious.
The Facts
The plaintiff in the case designed and sold women's clothing, which was both stylish and popular. The defendant is a substantial retailing group in Ireland who sells, among other things, women's clothing. In 2005 the plaintiff designed and commenced to sell in Ireland a striped shirt (in a blue and stone brown version) and a black knit top. The defendant purchased samples of these garments and had copies manufactured outside of Ireland and then began to sell them in its Irish stores in late 2006.
The plaintiff commenced proceedings in the Irish High Court and succeeded on the basis that it's unregistered design in the garments had been infringed. The defendant appealed from the judgement and continued to dispute the validity of the unregistered community designs. The appellate court stayed the appeal and referred questions to the Court of Justice of the European Union.
The Legal Framework
In the recitals to the E.U. regulation the following observations are made:
Some of those sectors produce large numbers of designs for products frequently having a short market life where protection without the burden of registration formalities is an advantage and the duration of protection is of lesser significance. On the other hand, there are sectors of industry which value the advantages of registration for the greater legal certainty it provides and which require the possibility of a longer term of protection corresponding to the foreseeable market life of their products.
This calls for two forms of protection, one being a short-term unregistered design and the other being a longer term registered design.
A community design should not be upheld unless the design is new and unless it also possesses an individual character in comparison with other designs.
In the course of its judgement the court clarified what was required to be shown in order to establish that a design had "individual character". Commentators in Europe suggest that the decision will assist right holders in protecting their designs in the EU whether in the fashion industry or otherwise.
Canada
In Canada there is no equivalent of an unregistered design right. In order to obtain protection for an industrial design it is necessary to file an application in a timely fashion and then obtain a registration. While the term of protection is potentially ten years the process is time consuming and can be relatively expensive, although not so expensive as obtaining a patent.
As a result developers of designs that will have a short market life are left in a relatively difficult position since they are faced with the expense and time required to obtain an industrial design registration. In addition, in many cases they are generally left without any protection under the Copyright Act since protection is restricted for eye appealing features of useful articles. While a common law claim for passing off is possible such a claim can be tenuous for new products.
Comment
It would be useful if a consultation could take place to determine whether Canada needs an unregistered design right particularly since it is anticipated that some changes will be made to the Industrial Design Act. It does not appear that Comprehensive Economic and Trade Agreement with the European Union deals with this issue although the full text of treaty has not been finalized.
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.
