Israel: Israeli Court Addresses Relationship Between Design Protection And Copyright

Last Updated: 29 November 2017
Article by David Gilat and Sa'ar Alon
  • Fisher Price Inc and Mattel Inc brought suit based on the marketing of a copy of a Fisher Price rocking chair under the name 'Infaniti'
  • The Israeli Supreme Court dismissed the claims of copyright infringement and passing off of the rocking chair, but approved the toy makers' claim of infringement of copyright in a lion figure imprinted on the product
  • The court touched on issues of first impression relating to the connection between copyright protection and design protection of a designed article

In Fisher Price Inc v DavronImport & Export Ltd (CA 1248/15, August 31 2017), the Israeli Supreme Court has addressed, among other things, the relationship between design protection and copyright, as well as trademark infringement and passing off.

The Israeli Supreme Court dismissed claims by Fisher Price Inc and Mattel Inc of copyright infringement and passing off in a copy of a rocking chair, but approved the toy makers' claim of infringement of copyright in a lion figure imprinted on the product. In its judgment the Supreme Court touched on issues of first impression relating to the connection between copyright protection and design protection of a designed article.

Facts

The appellants, Fisher Price Inc and Mattel Inc, first brought suit before the Nazareth District Court against the respondents, Davron – Import & Export Ltd et al, arguing that the latter were marketing a copy of a Fisher Price rocking chair under the name 'Infaniti' at approximately two-thirds of the price of their original chair. The appellants argued that they owned copyrights in the chair (more specifically the chair as a three-dimensional artistic work), in the illustrated padding of the chair (showing a lion character created by Fisher Price) and in the user manual enclosed with the chair.

The appellants also argued that the respondents infringed the trademark FISHER PRICE which appeared in the user manual. The appellants further claimed passing off (trade dress infringement) and unjust enrichment.

Decision

The district court ruled among other things that, absent a registered design, Fisher Price Inc and Mattel Inc were not entitled to remedies against the importers of the counterfeit chairs.

In delivering the Supreme Court's opinion on appeal, Justice Rubinstein first examined the relationship between copyrights and industrial design rights. J Rubinstein ruled that once it was established that a certain product is eligible for registration as a design (regardless of whether a design application was filed) it was not necessary to check whether the product as a whole is copyright protected, as according to Article 7 of the Israeli Copyright Act the rights are mutually exclusive. This ruling, accepted unanimously by all members of the court, changed the Interlego authority whereby a product could enjoy dual protection provided it embedded a sufficient level of creativity and where the author had not intended to limit work to the form of a product. As J Design Infringement Passing off Rubinstein found that the rocking chair was eligible for design protection, copyright protection for the product as a whole was denied. He also clarified that this ratio decidendi will also apply after Israel's new Design Law comes into force on August 7 2018.

Nonetheless, J Rubinstein held that original works should not be denied copyright protection merely because they appear on a product eligible for design protection. Relying on comparative law, he noted that surface decorations are not included in the definition of 'design' in the British Copyright, Designs and Patents Act 1988, and referred to the US Supreme Court decision in Mazer v Stein (347 US 201 (1954)), where it was ruled that an original work may be copyright protected, even if it is or is meant to be part of an industrial product. The judge further analysed comparative law on the question of whether physical or conceptual separability between the product and the work is required in order that the work would enjoy copyright protection, and subsequently established a three-tier analysis for this question of first impression:

  • step one – examining whether the article is eligible for design protection (if the answer is no, skip to step three);
  • step two (the key step) (only if the answer to step one is yes would step two follow) – examining whether it is possible to separate the original work from the product;
  • step three – examining whether the original work is eligible for copyright protection.

With regard to step two, while referring to US Supreme Court decision in Star Athletica, LLC v Varsity Brands,Inc (March 22 2017), J Rubinstein noted that an original work may be deemed conceptually separable from the object on which it appears if the original work can exist separately from the object without destroying its basic shape; however, if the object is made by reconstructing the original work, then the original work will have no copyright protection.

Step three, as mentioned above, concentrates on whether the original work is eligible for copyright protection. The main condition for copyright protection is the requirement of originality, which comprises the following three elements:

  • investment of labour, which requires the creator to have invested labour in the original work in order to enjoy its benefits;
  • creativity, which requires a minimal level of creativity; and
  • origin, which requires that the origin of the creator's work is not based on another's.

Citing Justice Posner in Gracen v Bradford Exch, 698 F2d 300, 304 (7th Cir 1983), "Judges can make fools of themselves pronouncing on aesthetic matters", J Rubinstein ruled that the illustrated lion passed the creativity test and was therefore copyright protected.

J Rubinstein denied the respondents' 'innocent infringers' defence, holding that such defence may apply in only exceptional cases where copyright protection in the original work subject to the infringement was reasonably questionable.

With regard to the appellants' trademark appearing in the respondents' user manual, the judge held that the infringer's mens rea was irrelevant, and that where the actual trademark is used, infringement may be established also absent confusion. However, he did not award any damages on account of the tort of trademark infringement, as the use of the trademark on an inside page of the user manual was negligible.

With regard to passing off, J Rubinstein held that although both appellants were well known, to succeed in a passing off action they had to establish goodwill in the specific product but had failed to lift the burden of proof in this regard. Justice Fogelman supported J Rubinstein's opinion stating that when examining the similarity between the two products the packaging should be examined in addition to the products themselves. J Fogelman concluded that there was no similarity between the packaging and therefore no risk of misrepresentation. Justice Meltzer dissented and in a minority opinion on this issue found that passing off was established in light of the circumstances.

The appellants' claim of unjust enrichment was rejected.

Comment

Rubinstein held that the respondents had infringed the appellants' copyrights in the illustration of the lion and in the user manual as well as the appellants' trademark. He remanded the case to the district court for determining remedies for the infringement. Costs of IS30,000 were awarded to the appellants.

This article first appeared on WTR Daily, part of World Trademark Review, in October 2017. For further information, please go to www.worldtrademarkreview.com.

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.

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