A seven-year battle between UK fashion company Karen Millen and Irish retail chain Dunnes Stores (Dunnes) looks set to be nearing an end after the European Court of Justice (ECJ) ruled in favour of Karen Millen.
The judgment appears at first glance to be good news for designers who are seeking to limit the success of copycats. However, it will be interesting to see how the Irish Court interpret whether a design has individual character or not.
The story so far
In 2006 Karen Millen designed and sold a striped shirt and a black knit top in Ireland. Dunnes subsequently reproduced these items and placed them on sale in Ireland for a significantly lower price.
Karen Millen sued Dunnes, arguing that Dunnes had copied their designs and that the designs were protected by an unregistered Community Design Right (UCDR).
Dunnes accepted that it had copied the designs, however, it argued that the designs were not protected by a UCDR because they 'lacked original character'.
The Irish High Court initially decided in favour of Karen Millen. Dunnes appealed to the Irish Supreme Court, who referred the case to the ECJ, asking the ECJ to clarify what constitutes 'individual character'.
What did the ECJ say?
Dunnes argued that Karen Millen could not rely on an UCDR because the designs did not have individual character and failed to 'produce on the informed user a different overall impression' from similar items. They stated that Karen Millen's design was based on a combination of features from earlier designs and that this combination of features gave the same overall impression as Karen Millen's designs. Furthermore, they argued that it was for Karen Millen (and not them) to prove that the design had individual character.
In its judgment, the ECJ held the following:
1. An unregistered design should be presumed to be valid if the right holder indicates what elements of their design constitute individual character. This means that the right holder does not need to prove that a design has individual character, rather it is for the defendant to contest the validity of the design.
2. The assessment of whether a design has individual character cannot be made by reference to a combination of earlier designs but rather by reference to one or more specific individual designs.
So what does this mean?
The case will now go back to the Irish Supreme Court for the final ruling, which will be based on the ECJ's decision and so this has effectively settled the matter.
Whilst the first limb of the ECJ's decision is welcome news and a boost for the fashion industry, as the obligation to prove that a design is invalid now clearly rests with the alleged infringer, the question of what amounts to individual character (and thus validity) is not so clear.
Prior to this case, most claims for UCDR were based on the designer having combined pre-existing features into a product. It was the combination that gave the product individual character and thus validity as a UCDR since, it would be argued, the combination had never been seen before albeit each feature had. The second limb of the ECJ's decision makes unclear the question of whether a combination of pre-existing features can still be used to prove individual character or is it that you can now only rely on 'specific individual designs'. Hopefully the Irish court will clarify the meaning of 'specific individual designs' but no doubt others will interpret the ECJ decision for their own benefit probably leading to another reference to the ECJ to clarify this decision.
So designers are in a stronger position in making claims for UCDR against copycats since the copycats are now under an obligation to prove that the design does not have individual character and is thus invalid. However, the copycat could argue that each of the features of the design is common and that the design does not have a 'specific individual design' that amounts to individual character. That puts the designer in a difficult position at the moment since he/she would have to go to court to find out if their design did have individual character and thus be able to stop the copycat product from being sold.
For the moment, if you are a designer it is probably worthwhile trying to stop a copycat product based on this ECJ decision and taking a commercial view on whether to pursue the claim through the courts based on the arguments coming back from the copycat.
The ECJ decision may be a deterrent to some infringers but not all. We shall therefore see how the case law in Europe pans out and how they interpret this ECJ decision, watch this space.