Mathilda Davidson: Firstly, good morning everyone, and welcome to this, the third in our current series of Gowling WLG ThinkHouse brands and designs webinars. In the previous webinars, we have looked at advertising in the current pandemic and at the response of brands to a time of fast-paced disruption and social change. If you missed them, both previous webinars are available on our website and we will also be emailing round a link after this session. We do also have a fourth webinar in the series coming up in the new year with our colleague Khemi Salhan. Khemi will be discussing what every business needs to know about the often overlooked right of copyright, so do look out for an invitation to that in the new few weeks.
As in our previous sessions, we really welcome your input during today's webinar, so please do submit your questions via the Q&A function at the bottom of your screens. We will either try and pick them up as we go along or at the end when we have factored in some time for questions. I am really sorry if we do not manage to get to every question during today's session but rest assured, if we do not manage to cover your question, we will follow up with you afterwards.
I have mentioned the two previous webinars in our series: those of you who tuned in will have spotted that John Coldham chaired both of those previous sessions. Well, today, it is John's turn in the hot seat. John is the head of our UK brands and designs practice here at Gowling WLG. He is described by the legal directories as one of the leading design rights' experts in Europe and a go-to person for design disputes.
Today, John is going to give a brief recap of the current design and protection landscape, and then talk about his recent win in the Freddy V Hugz case. He will finish up with the impact of Brexit on design protection and some practical pointers on what this all means for your businesses. So, John, I will hand over to you.
John Coldham: Thanks Mathilda. Hello everybody, good morning. As Mathilda said, I am going to start with a bit of a recap about designs. There is quite a mixture of different people who have dialled in today and so I do not want to make it too complicated too quickly or too simple for everybody so there will be a bit of a mix in the subject matter.
As Mathilda said, we are going to start with a reminder of the importance of designs and what basically they are all about because there's so many different types of design and different ways of protecting products and brands and so on, that we need to make sure that we get a good picture of what we are all about before we go into any detail. Then I will talk about the Freddy V Hugz case, then I will talk about Brexit and, finally, I will talk about what it all means for you.
Now, designs are relevant to a lot of different types of people, they are relevant to people who do product design, they are relevant to people who do logos and things like that, so basically, every type of business could have at least some form of design protection that would be useful. There are some businesses which may not need huge amounts of design protection but it is more than most people think.
So moving straight into the different types of design that we have now, big caveat I am afraid I am going to keep mentioning the B word of Brexit, this is all going to change at the end of the year but we will look at how it is going to change later, and the basic ingredients are staying the same.
First of all, looking at the unregistered picture, I am going to try using a laser pointer, please forgive me if this looks terrible, but I am going to try and do it just to point at different things as we go along. The top one is UK unregistered designs, these are designs that protect the shape of something, only the shape, and we will look at that in a lot more detail when we talk about the Freddy V Hugz case shortly. These last ten years and they are obviously only applicable in the UK.
Moving around to the left, to the grey circle, there is unregistered community designs. At the moment if you first disclose your product in the UK, you will get both the UK unregistered designs and the EU version which is the unregistered community design. However, they are very different rights. The European version only lasts three years but it protects every aspect of the product, or it does not even have to be a product it could be a logo or a pattern, it protects the shape but it also protects the colour, the material choice, the lines, the contours, everything - that is the big difference. UK unregistered designs are therefore seen as potentially being more broad, in that they only protect the shape, so if you have something like the G-Star case that I did a few years ago, where actually some of the alleged infringement products were actually made of a completely different material, so they were more like chinos than jeans, but because it was all about the shape that did not matter for the EU version that would have been more relevant.
Looking at the bottom left, there is also copyright. Copyright is obviously different to design right but UK unregistered designs, for example, were extracted from copyright in the first place so copyright is something to think about when talking about designs. As Mathilda said, Khemi is going to cover that in January in a specific session about copyright, not just of products but also copyright more generally, so I will not will not cover it in detail here. Suffice to say that the case law on copyright is moving towards more products, articles of applied art as they call them, which may be protected by copyright in the way that perhaps previously people did not think that they were. The European Courts would say this is not a change of the law - it is just a clarification - but we all know what the Europeans think about things like that.
Looking at registered designs, there are two types, and that is obviously on the bottom right of your screens. There is UK registered designs and registered community designs. As it is harmonised, both are basically the same thing, apart from the geography that they cover. The registered community design currently covers the UK as well but will cease to apply in the UK after Brexit, and when we talk about Brexit, we are talking about the end of the transition period which is 31 December 2020. I will talk about the changes later. I bet you cannot wait - it is a nice thing to look forward to on the talk, but in a moment, I am going to talk about the current position which mostly applies after Brexit as well.
Right, the value of registered designs - why would you consider registered designs? Well, first in the UK and the EU at least, they are cheap. I am only talking about the application fees now - not any fees you might have if you go to a design attorney to get a registration, although they do not tend to charge a lot of money either. The UK application fees can be as low as £2 per design and the EU version, bearing in mind that it covers even after Brexit 27 countries, is as low as 80 Euros. If you filed just one design on a single day, then you will pay more than that per design because their first one costs more money. In the UK, the first one costs £50, and if you apply for say, ten on the same day, the ones from two to nine are a total of an additional £20 and so it goes on… if you file 20 on the same day, you are looking at a fee of £90 in total.
EU: similar idea on a slightly different cascade, so do not let the cost of registering your designs put you off. In fact, the cost is such that you can think of some reasonably innovative ways of protecting even one product with several different potential design rights. They last a long time. They last 25 years for lots of products that may be far more than you need, particularly in the fast moving consumer goods sector. In that area, you may decide that actually you do not need it for 25 years, so when the renewal fees start coming in at five years in, you may have done everything you want to do with your design by then, and you can make a decision, at that point, whether to pay more to continue the protection or whether to leave it. You have to register it at the very beginning and you do not know, at that point, whether or not the product will be a success, so knowing that you do not have to pay the fees to cover the whole 25 years up front is an advantage. This is much longer than a number of designs, I have already said they last between three and ten years, so this is quite significantly longer.
After launch, you can still apply for a UK or EU registered design. There is a 12-month grace period, which means that if you want to take your product to a trade show, you want to show it round, see whether there is any appetite for it before seeking to register your design - you can do that. However, it is not something that I recommend unless you have to. The reason for that is twofold: one is that they are quite cheap to apply for, so just get the registration in first, and the second thing is what you can do is if you file your UK or EU registered design application, you then have a period of six months before you have to apply for your registrations elsewhere in the world, where the application fees are quite a bit higher. Therefore, you have got a little bit of time that you can buy before you then go to other parts of the world, so it is quite popular to register in the UK first. A warning though, if you rely on the grace period, that may limit your options for internationalising your design later because they will apply their own law as to whether there is a grace period in their country before moving to register your design. So, if you are relying on the full 12-month grace period here, and the other country that you are trying to go to does not have that grace period, then you will not get protection there. So my general advice on this is not to use the grace period unless you have to, but to bear it in mind, so that if you have disclosed it in advance of seeking any form of protection, bear in mind, it is not too late, and you can probably salvage at least the UK and EU even if you cannot necessarily get protection in some other parts of the world, but it is an area to get advice on.
What are the other advantages of registered designs, well the main one for me is well they did the two with the grey edges are the most important things really; one is they are very effective online takedowns. You can use unregistered designs for online takedowns. You can use other IP rights like copyright as well, but having a registration that is presumed valid is a useful thing because you can wave it at the platform, and they will take the product down if they think it is too close without asking too many more questions. If it is an unregistered right, you need to explain more, it costs more money and it takes more time.
Likewise with settlements. Registered designs get a bad rap because when you get to trial, they are quite often unsuccessful, not always, but quite often, and the reason for that is because the trickiest cases get to trial, in our experience, registrations tend to lead to faster and better settlements. That is because the defendant would have to prove that your registration is invalid or that it does not infringe it at trial, which is obviously an expensive step for a defendant. Therefore, if you have a certificate they tend to, not always of course, they tend to be more amenable to finding some form of compromise. Whereas, with unregistered designs, it is just that bit easier to seek to challenge the basis on which you are bringing your case.
Looking at the perceived drawbacks of registered designs, and there are some, you need to use them for the right scenarios and not the others. The first one is that they are, as I just said, generally interpreted pretty narrowly. That is not always the case. If you have got something that is particularly revolutionary, then it may well be that it has a reasonably broad arm of protection, but not always, so they are relatively narrow, and there are ways to make the most of that or to get around that problem, and we will talk about that in a minute.
The other problem is that you have to register and define your scope of your design before you have any idea how somebody else is going to try to rip you off. This is a problem because obviously you could include a feature in your design that you were pleased with at that time, but people can design around it. They can look at your lamp with a round lampshade and they can decide to make it hexagonal, they can take all the other features, but if you included the lampshade, the lampshade will be taken into account when considering the scope of protection of your design. It does not mean that one with a hexagonal lampshade will not infringe but it is a notable difference the Court will take into account.
Now, the third point on this slide is that if you do register a lot of designs, then obviously even cheap designs add up if you buy enough of them. I would not personally consider this to be enough of a problem for most businesses, but if you are a start-up, these costs can still add up. It is something to bear in mind, but there are ways to manage that cost. One way to manage that cost is to go for UK only, in relation to as many designs as you can, where you can get as much as 100 designs for £250, and then think carefully before internationalising or before renewing. You should have a pretty good idea that if you have not made any money out of your registered design within the first five years whether you are going to make any money out of it going forward. So before you fork out for the renewal fees, you can try and manage those costs, but it does require you to really think about your portfolio and manage it actively, so you do not accidentally end up paying out for things when you are not really using them.
Finally, you just do have to be careful if you are filling lots of designs maybe for different iterations of your product that your earlier product does not invalidate your later and better design. That requires you to have a bit more of a strategy about how you are filing your design, so if you know there is a tweak coming that is going to make your design that much better, you do not want to file the earlier design too early because otherwise you could end up taking the majority of your later design out meaning that the tweak is not protectable on its own, but, together, it would have been a stronger registration than if you had filed too early.
So, how do you make the most of your designs? Well, I know if you have watched these seminars in the past, I have talked about Trunki cases a lot, and that is because they were the subject of a Supreme Court case a few years ago, but here are three different versions of what is, fundamentally, the same product. The middle one is actually a slightly earlier version. I would recommend filing multiple designs for the same product. You could do it like this, a photo, a CAD and a line drawing. Those are, if you file them on the same day, legitimate different designs but you might also want to protect just parts of the design. If you register these sub-designs, different levels of detail or different parts of the product, then that means it is harder for somebody else to design around your product. Obviously, each of the sub-designs has to be protectable in its own right, i.e. it has to be new, so you cannot go down to the infinite detail, but you can think about how to split that design into different elements. Putting yourselves in the shoes of the infringer is not a bad way of doing things. One thing that Apple did when it was registering its first ever design for the iPad was it registered some thicker versions of the iPad. Do not forget, you do not have to use the design yourself to keep it, it is not the same as trademarks. As far as I understand it, the reason it registered thicker versions of the design was because it knew that it had patents on all of the miniature components that made up the first iPad and it knew that its competitors would necessarily have to make a thicker version of the iPad in order to be able to sell and not infringe the patent. So they registered some of the designs for the thicker version of the iPad to make sure that they had that covered. It was not actually successful in the fullness of time because it was decided the design for the iPad was still too simple but the idea was one that can be borne in mind by other designers.
So to summarise how you make the most of registered designs, using a bank of UK designs as a springboard for wider geographical protection of a subset of them is a really good way of doing it. Whether you are a UK business or an overseas business, it does not really matter - anybody can file a UK registered design, provided you have filed it nowhere else first unless you are relying on priority. I would recommend you use a bank of UK registered designs, and then from there, expand out to different geographical jurisdictions where you feel that is helpful.
Also, consider which parts of the product are worthy of their own protection. Use the cheapness of designs to your benefit to register them, so sub-designs as well, and use dotted lines to exclude those parts that are not protected by the design. I saw a good example of this once where it was a design for the sole of a shoe and the one groove in the sole of the shoe was protected as a design right in its own right. Why? Well it was actually quite an intricate design in itself. So it survived the attack that it was not particularly new, but what happened was the client had used it as a sort of chevron going up the shoe, but by protecting just that one chevron with all its detail and dotting out the rest, it showed that it was in the context of the sole of a shoe. What they did was they managed to catch somebody else who had used the same chevron but had used it inwardly I think - I may have got that the wrong way around but, either way, they took the groove but they took it and used it quite differently on the shoe. Now, had the chevrons been pointing inwards rather than outwards, it was a question of whether or not that would have infringed if it had been for the whole sole because they were quite different in that respect, but the groove was exactly the same and by protecting just that one groove, they had a stronger case.
Do be careful though, final point on this, on the use of colour. Lots of clients of mine and lots of people I have seen out there use colour because they do not think about whether or not that level of detail is a problem. CAD software quite often uses, for example, a blue for shading or something like that, just to show the contours. It is not intending to limit it to the colour blue. If you do include blue in your product, it will not be fatal to a case about other parts of the design, but it will be factored in, and I had a case last year for our client Chernobyl where the blue contours were seen as being part of the design and that was not intended, so just be careful to exclude any levels of detail that you think may distract from what you are trying to protect.
Okay, that is enough about registered designs for a bit. So let us look at the value of unregistered designs. It is pretty simple - they are free. That is really quite a valuable thing to think about in relation to design because, as I have said, registered designs are not that expensive, so that is probably not enough in itself to justifying that you thinking about it too hard. The real advantages of unregistered designs is that if you qualify for them, and we will look at that later, they are pretty broad. The unregistered UK designs, as I have said, covers just the shape, so there can be lots of other differences, but if the shape is the same, it infringes. We did a case a few years ago about showers where the infringement was opaque white plastic and the original was glass. They looked, to the consumer, quite different, but not in relation to the shape, which was very similar, and so it was found to infringe UK unregistered designs.
They are also, looking around the other side of the circle, they are also pretty flexible. You can define the design that you are relying on at the point at which you got the infringement in front of you, so that is the point at which you can do the exercise that in registered designs you have to do at the beginning to decide which bits of your product were the key ones that had therefore been taken by the other side. Some cases have, you have seen defendants arguing that that is not fair in some way, why should you be able to craft what is effectively your designs after you have seen the infringement, and Judges have been pretty unanimous in saying that that is not the way it works. You have the design beforehand - you are just defining the legal scope of it after the event, and as long as that design is new in itself and is not commonplace, then it is a perfectly legitimate way of doing it. Obviously if you get it down to the square top of a box and nothing else, then it will fail for not being new and interesting and, as I said, they last between three and ten years, depending on whether you are talking about the EU version or the UK version. The EU version lasting three years is a frustratingly short amount of time. By the time you first marketed the product and you have been copied and you have sued them and you have gone through to the trial, the odds are, most of that three year period will have been used up. Therefore, if you are in the sort of sector like fashion where you might want to rely on that sort of right, you need to think about whether you are most likely to use it for an injunction, in which case, of course, it is more likely that the three years will be useful. Or you want to think about coupling that with a couple of registrations.
Looking at the drawbacks of unregistered designs; the first one is that you need to prove that you own the rights. If you have a registration certificate, then obviously you own the rights because it is written on the certificate, and somebody has to challenge whether that certificate is right. With an unregistered design, I can count a thousand times, the number of times you write to people about an unregistered design infringement, and the first thing they come back with is "Prove that you own it" and you have to go through your records.
So, one of the most important things to do is to ensure that your paperwork is in order to show that you not only qualify for the rights but you own them as well.
So, that brings us to the second circle, which is how you prove that you qualify for the rights. This is almost a talk in its own right, so I will not go into it in too much detail. Suffice it to say that, basically, if it is a UK unregistered design, at the moment up to the end of this year, if you are a UK or an EU resident company or individual, you will qualify for UK unregistered design just by virtue of being based here. There are some other countries that apply too, Hong Kong, New Zealand and a few Caribbean Islands, basically you have to be from one of those places. That is changing at Brexit, without trying to give too much of the end of this talk away, if you are a EU27 resident, you will no longer qualify through that route. There are still things you can do, and we will look at that later.
You also need to prove copying. With registered designs, you do not need to prove copying. You just need to prove that they have something that is too close. With this one, you do need to prove copying. In some cases, that is just really straightforward, it is obvious that they've copied, and if it is too close, they have to prove they didn't copy, which can sometimes lead to some reasonably amusing stories being told about how they came up with the design that was so similar.
Finally, you do have to just bear in mind that it is a shorter period of time than the registered designs, and you cannot think about registering later because you have missed your chance after that grace period, so think at the beginning about your strategy - you need to have a plan.
So, making the most of unregistered designs. Establish early how you are going to qualify for the rights. Ensure your paperwork proves that you created and own the rights and consider your launch plan to ensure that you maximise protection.
Under both the UK and EU versions of unregistered design, there are ways of qualifying for the design by where you first market your product. So if you want a particular jurisdiction to be protected, then the best thing to do is to think about how and where you are going to do your launch.
Now, for most of my clients, they would say that their launch plan is not going to be dictated by unregistered design protection, and that is completely fair enough - you do not want the tail wagging the dog. However, you do need to think about it a bit because if there is something you can do to tweak your plan, to maximise your protection, it might be worth it, and it may be cheaper or easier than going for lots of registered design instead.
The other final point, is just keep a track of copies. My experience is that if you let those copies proliferate, everybody seems to think your design is fair game, and before you know it, you have a huge enforcement programme on your hands, or you decide it is simply too late. The best thing to do is to try and crack down hard on the initial few copies, so that people go and copy someone else.
That is enough of a recap on designs and what they are. For those of you who are already very familiar with designs, forgive me for the recap.
Moving on to the case that we did where the Judgment came out, very conveniently, two weeks before this webinar, and that is the case of Freddy V Hugz. With apologies for the number of times I have am going to say bum and bottom over the next ten minutes or so, I am going to go straight into what this case was about. My very young children think that it is hilarious that this is what daddy does for a job.
Introducing the Freddy WR.UP jeans. The idea of the design of these is to accentuate the shape of your bottom. Inspired I think by Kim Kardashian and friends. Our Italian client designed these products, which work in, a maybe more user-friendly way than surgery. They have been extremely popular and therefore, inevitably, they have been copied.
Here is The Hugz version, The Hugz Mark One. The reason it was called the Mark One is this was when they first infringed Freddy. This case, with this design was actually settled. They agreed that they would take it off the market fully, by the end of April last year, 2019. However, on the 1 May, or maybe the 2 May 2019, they brought out a new design. I think they thought they had been awfully clever. Here is The Hugz Mark Two. I am slightly hesitant to do this, but I will do it. I will just move onto a comparison slide, I am going to get my laser pointer out now and I am going to point at different bits of the design.
Now, this one here is the Freddy design, and you can see here that this seam goes right to the middle. In the Hugz Mark One, which is this one here, the seam did the same thing. Their wizard wheeze on how to avoid infringement both of the patent and the design was to remove that seam there. So that seam there was taken away and it was pleated instead. This, they thought, got them round the patent but also round the design.
Freddy was not happy with that, so it moved to bring proceedings against this second product, the design around, and it relied on four different claimed designs. Remember, we can define the designs at the point of the infringement, so that is what we did.
The first design was the shape of the jeans when they are being worn. The second one was the internal rubberised support panel, and I will show you that in a second. The third one was the shape and/or configuration, that is what UK unregistered designs cover, of the inner parts of the upper portion of the garment, and finally as an alternative to the first one we relied on, the shape and/or configuration of the jeans when not being worn, the jeans on their own.
I will just show you what each of these designs is before we talk about what they consist of. This is the internal rubberised panel, here, this bit here, and that creates a resilience which pushes up everything that is above it. The next, the inner parts of the upper rear portion of the garments, by the way, these are inside out, consisted of the four things on the slide.
So to go through those designs in turn. The when worn design, was perhaps the most controversial. When you have a claim for a design of a product, you are claiming the design of that product. If it is only going to take that shape, do not forget we are only talking about a shape, when it is worn by a particular person, that is less likely to be protectable, and so it was found in this case.
The problem we had with this case was that the real innovation or real design of this product was when it was being worn by a person, but to do that, you need the person as an ingredient, and the argument was by the defendants, that everybody is different, everybody's bottom is different and therefore everybody's jeans would look different when worn even, if it is shapewear.
We argued that actually the shape is the same, the size might be different, but the shape is the same in every scenario, but the Judge was not having that, and he said that it was influenced by the shape of the wearer and therefore it was not capable of design protection on its own.
So we moved onto the next one, which was the alternative pleading, which was the jeans on their own. This was a more conventional design claim, but we felt the reason we put the jeans when worn in is that it is hard to tell from the jeans themselves, in fact, I have got them here - if you look at them like this, it is very hard to see what shape they are really intended to create.
As this was not reliant on the human body shape, we got over the issue that we had with the when worn design. Where it was potentially, or certainly in the Defendant's view, slightly controversial, is that we claimed the elastic nature of the panels. Remember, unregistered design only covers the shape and configuration of the product. So we were relying on this as the configuration, a part of the design right which is not always that well understood, but basically, we were saying that the different panels together, the configuration of those panels, including their elasticity, created movement and that movement was part of the design.
There have been a few cases about moving designs, but not many cases have decided the point in a particularly clear way, and this case did. This case said that that was okay, the notion of shape and configuration is a broad one and it should encompass the notion of movement. Now this is really relevant to lots of companies, probably much more broadly than fashion or Freddy. If you have got a design for something but really where the design becomes relevant is when it moves, it might be a pushchair, it might be an umbrella, it might be something like that, those are all scenarios in which this case could really help you. The objection was its shape and so therefore the material choice should not be relevant, but our claim was not to the materials, it was to the shape and configuration created by those materials.
Now, there are various exceptions to unregistered design protection. There were four, they threw the book at this one, they tried to rely on four different exceptions, which would basically say that if one of these exceptions applied, then design right does not subsist in this, and this is one of the problems, if you like, with unregistered designs because there are a few more things that you can throw at it to try and knock it out.
The first one is that the design consists solely of a method or principle of construction. This has two different types. One is that basically your claim is so broad and abstract that it is not really relating to a real product and therefore it is just a method of constructing a pair of trousers and you're just throwing some things in there without being too specific about it. That was an objection thrown at these jeans. The other one was that it is a claim to a manner in which the article is put together, so it is a claim to just the seam, or something like that. Now, in relation to the rubberised support panel design and the inner parts design, both of which are shown on this slide, they claimed that all we were really doing was claiming the use of a rubberised support panel per se in the product. They said this was too abstract and therefore was not protectable. We said that was not the case. We said that we were relying on the not just any rubberised support panel, but this rubberised support panel, as shown in this product. We said that the rubberised support panel in the defendant's product, for all intents and purposes, the same, and that's why it infringed. It was not the fact that you have a monopoly over having a rubberised support panel at all. If you wanted that sort of protection, you'd have to go down the route of patents, which we did, but in a different way. So, therefore, the Judge found that that argument was not applicable here.
The other objection on the basis of method or principle of construction was on the jeans on their own design. That was about the fact that the elastic panels and the seams and so on were just about how the product was put together – not that it was too abstract because it was the jeans as a whole – but it was just about how you put it together, it wasn't about the shape or configuration of the design. The Judge said "No". He said that misunderstood the exception for methods or principles of construction. He said that it is not, we weren't protecting those bits – we were protecting their application and resulting shape and configuration and that's why he said that that argument did not run and that the design was valid in relation to those bits.
So, moving on to the other three objections made, and I will do this relatively briefly: the first one was "must fit". It is quite a good reminder this case all the different things you can throw at something, even if actually they rule unsuccessful in this case. "Must fit" is where you have something which is a feature of the design which is only there to enable the article to be connected to, placed in or against another article in order to perform its function, so the two have to be next to each other in order to perform their function. This was argued in relation to the rubberised support panels. What they said was that they are flat, and the only reason that they are there is to fit against the jeans themselves in order to perform the function which was to push up somebody's bottom. This didn't get any real traction in this case because the Judge said that it is not against another article – it is all one article. It is just a pair of jeans. The idea it "must fit" exception is more to do with having a spare part that has to fit against another product in order to perform a function, so it is the exhaust pipe on a car has to fit with the next part along in the production line because otherwise it will not work, that what it is really about. It is not designed to split one article into its component elements and that's why that point may be quite be useful for other cases.
The "must match" exception is similar but different. This is about where the features of one article are dependent upon the appearance of another article in order to form an integral part. Now, the argument here was the jeans were designed in such a way that they must match the bottom of the person, so that they were skin-tight effectively, and that they were both together form an integral part of the integral article. There is an open question in design law as to whether or not the human body is in fact an article. There was a case called Ocular Sciences a few years ago which looked at contact lenses and eyeballs and whether or not "must fit" or "must match" applied in that scenario. We decided it was going too far to ask the Judge to consider that question here. We said he didn't need to because he was actually, all he needs to look at was whether or not the jeans and the human body formed an integral part in relation to the scenario we were looking at here, and the Judge said no, it was not – they were still two things and they were not designed to form integral parts. So it is not like having one car door replaced on your car and it has to match the others otherwise it will look odd. It is different because when you put the car door in, you're creating a car. You and your jeans are still two different articles. That argument would have been perhaps interesting had they played it against the "must fit" exception where they must fit against the human body but I would still think they would be unsuccessful.
Finally, and very quickly, they argued that the rubberised support panel is something that is just surface decoration. That and the seams are just there on the surface to make the thing look pretty. There was one obvious, fundamental flaw with that argument, and that was that we are on the screen at the moment looking at the inside of the jeans, so it is very difficult to argue that the inside of the jeans could be seen as decoration. But perhaps with more general relevance, this argument that if something is really flat and therefore doesn't have much 3D shape, can it be anything other than surface decoration? Well, the Judge said "No". The fact that something is effectively 2D doesn't mean, automatically, that it is surface decoration: you could have a piece of paper that pops out a pattern for something – that is still capable of design right. Just because it is flat doesn't mean that it is excluded as surface decoration but it is a useful reminder that if something is on there just as decoration, it is not part of the shape and is therefore not protected.
Finally, and very quickly, we looked at passing off in this case – I'm not going to talk about the pattents angles of this case – they were relatively conventional. This is obviously off-topic slightly, but its relevance to product designers. If you create some features of your product that are characteristic, they're like branding elements; then, if you rely on those, it may be that you can argue that a later infringer is misrepresenting to consumers that it is in some way associated with you.
Now, in relation to this, the branding elements on the screen, the whole rear of the jeans, but also the crossed-over belt loops and the enamel button on the fake pocket were features that Freddy had promoted very heavily when doing its promotion for this product. Jeans, as you probably know, quite often, hopefully you're not looking too closely at somebody else's bottom when you're looking at branding elements, so these pictorial bits are really relevant and they are quite often used as a way of recognising a pair of jeans as being from a particular brand. The most notable is probably the Levi's red tab, but you can also think of the Wrangler pocket, and so on.
This case is no different in that respect: we said that these branding elements were things that people would associate with Freddy if you were in the right consumer group. The other side said that these were not branding elements, and anyway, the person buying the jeans knew that they were Hugz because they either bought them from the Hugz' website or they bought them – and they say Hugz on the inside and even on the belt loops. We argued that this was still passing off because people would have thought that the designs and so on were so close that they must have been in association, even if they were sold under a different brand, but also that the, as an alternative and slightly more unusual argument, there was what's called "post-sale confusion" in passing off. This is where this case was probably at its most interesting in that the Judge found, for the first time in the UK, adopting some reasoning from a case we found in New Zealand, that post-sale confusion and passing off is an acceptable basis for attack. That is, the consumer that buys your product is a conspiracy with you effectively, to convince other people that they're wearing the real thing. So this whole idea that the brands you're buying into the look of the main brand even though you've bought the copy – that could now be an infringement by the infringer, because they are misrepresenting to the consumers that that product is associated with the main brand and that could lead to confusion in the market place. I'm not going to go into too much detail, because that's almost a topic in its own right, but I wanted to flag it as being a point of particular interest in this case.
Now, I know you have been looking forward to the bit about Brexit, so let me come onto that now.
Brexit and designs is an area which is particularly complicated unfortunately, and I will try and simplify it as much as I can. You will recognise this from earlier. I have added a few annotations but effectively, the design position as of now is this, but as of the end of this year, with the new regime coming in from 1 January 2021, changes things somewhat. So, if we overlay the picture that we looked at earlier with the post-Brexit position, and I'll just do that now, you will see that there are some changes to the position in the UK, post-Brexit.
As you will see, there's an extra box and a few of them have changed. Instead of having an EU registered design applying in the UK, because they will no longer apply in the UK, the UK is cloning EU registered designs and putting them on the register as if they were UK registered designs from the same time. Here you will see "re-registered designs" is what they are calling them – they are the formerly EU ones that are now coming into the UK. They will be treated the same as a UK registered design, but they will have all the dates and so on from when you applied for the EU level. That's just to maintain your level of protection that you had previously. The EU registration that you had will still apply but obviously it will only apply in the other 27 member-states of the EU, so it is just worth bearing in mind you will most of this splitting into two bits and you will have to pay renewal fees on both, I'm afraid. If your renewal fee is coming up soon, don't think that you can pay this side of the new year and avoid paying the UK separate fee. If it would strictly have come in, the renewal date was after 1 January, I'm afraid you'll have to pay both.
One other point to think about is if you have an application that is ongoing at EU level now and it is not going to be published and granted by the end of this year, then you will need to re-apply in the UK to maintain your protection. You have nine months to do it and to maintain the original filing dates that were deemed at the EU registry, so make sure you've done it – ideally, early next year, because I think there'll be a bit of a crush on the registry end of September next year. The one important point for some of you is that if you have registered your design but you have deferred publication of that design, you have to make sure you've published it this side of the new year. If you don't, if it is not published before the end of the year, you will have to re-apply for it in the UK.
Now, the EU unregistered design protection system is changing slightly, and I will just add a couple of labels to this to help you with that. For designs created before the end of this year and first marketed in the UK or the EU i.e. EU unregistered designs that cover both the UK and EU – they are going to be split, a bit like registered designs, so you will have a UK version called the "continuing unregistered design". It will work in the same way, but if you sued under in the UK, it will only apply, jurisdictionally, to the UK and your EU one will carry on.
For designs created after 1 January 2021, and first marketed in the UK as opposed to the EU, you will get equivalent protection to the sort of protection you would have got under the EU protection but it will only apply in the UK. That is called "supplementary unregistered design" and strictly, you have to choose between that or the EU version – you cannot, in theory, have both. Copyright stays the same.
Now, the European position overall is slightly more complicated, in that if you want to have protection as you do now, in both the UK and the EU, you need to think about the fact that you will have community registered designs that you can apply for as well, and those community registered designs – you can apply for them even if you're British and you can apply for UK and EU ones as long as you think about making sure that you don't invalidate one with the other. If you do my suggested system earlier of applying for lots of registered designs in the UK and then using that six-month priority window to apply for your EU ones, that could work well, but you just need to make sure you keep an eye on your dates.
The choice I was talking about when looking at the previous slide between the UK ongoing version of the EU unregistered design and the community version is at the bottom left of this slide, and it is important to think about. There are some things to think about, about how you might be able to try both but we're running out of time, so I will leave that to see if anybody's interested in that during the questions.
The UK unregistered design position, the one at the top, the shape only unregistered designs – you will no longer qualify if you are an EU 27 business unless you first market your product in the UK. If you first market your products in the UK, you could still qualify for UK unregistered design protection, and if that is particularly valuable to your company, you might well want to consider that, because if you are not interested in EU unregistered design, first marketing your product in the UK may help you get a very valuable form of protection. Obviously, the other option is that you just register more designs than you were before.
So, summing up because I'm conscious of time, what does this mean for you, overall? Well, designs have always been a good fall-back. They still are, but it is now even more important that you plan ahead. Many clients come to us thinking that they want to rely on their registered design that they have filed but actually the registered design isn't necessarily very good, because they didn't seek advice on it, and so we end up falling back on unregistered design. Because it is there automatically and you just have it but if you take a bit of effort to plan your unregistered design protection, then you will find that you're in a better position. The reason you will be in a better position is if you document who designed it? Were they an employee of yours? Were they based here? Were you based here? Did a contractor help? That kind of thing. If you document that, even on one-page form at the beginning, then you will just find that when you come to enforce it five years later, it is that much easier, and you will spend less money doing so.
Also, you will find that your designers and your people you've worked with are more likely to be happy to assign you the rights or to help you clarify the rights if you do it at the beginning rather than when you need them five years later and you maybe don't have as much contact with those people later on.
I've already talked about launch strategies and I won't talk about them too much more now, but do think about them carefully to maximise the unregistered design protection if that's feasible in your business. And if it is not feasible in your business, or anyway, do consider registration of your product and logos and other graphical works as designs, as if you think they will be infringed. Obviously, think about other forms of protection too like patents and trademarks, but do not forget that designs can be used to protect graphical works, and with that, I'll be quiet, and see if we have time for any questions.
Mathilda: Thanks John, for that really interesting talk. So, now, looking at questions, we've got one about the EU and UK unregistered design position post-Brexit, which is "If you want to try to have both EU and UK unregistered design rights after 1 January 2021, can you publish first in both the UK and the EU?" and the contributor has given the example of them both putting it on a website in the UK and the EU on the same day, because obviously a website would be able to be seen simultaneously in both places.
John: Well, this is spot on to hear her ask that question, but that is absolutely the question of the day. In fact, it is a question that I have been lobbying in the UK Intellectual Property Office about because the answer is that it is just not clear at the moment. In theory, what that person that asked the question has said is absolutely right: if you publish on the same point, so you publish on a website that is pointed at the UK and EU equally, my view is that that should be capable of protecting for unregistered designs in both, but the point is though, and it is not primary something that the Courts have considered, and so it is unknown. What I've asked the UK Intellectual Property Office to do is to take the bull by the horns and say whether or not under the, obviously they can't talk about the EU position, but they can talk about the UK position under these supplementary roles – what will they consider under the law to be acceptable? So far, I've been brushed off by the UK IPO saying that they need to wait for a case to clarify it, and I'm afraid I'm not taking "No" as answer – I'm going to be talking to UK Intellectual Property Office about it a bit more, because I think that it is not fair on businesses to have to try and potentially fail, because if they do one thing and actually the other was the right answer, then it is too late to do anything about it. We need the certainty now, and I have a few other people from the profession who are interested in this as well, and we're going to try and lobby the Government to make some clarification on this. It may mean passing a statutory instrument in due course, just to clarify the legal position, which obviously, then would then be applied by the Courts. The trouble is, these cases don't come up that often and if we wait for a case to come up on it, then we're going to be a little way down the line, by which time, lots of designers will have tried something and failed. So, my strategy, in the meantime, would be I wouldn't rely solely on that – I would rely on registered designs as well, but what I would be doing is, if you've got something where you really want UK and EU unregistered design, based in the UK – I would try and do it from the UK, because then you get the UK unregistered design too if you really qualify for it – I would publish it simultaneously in the UK and the EU, and then if you don't end up with both, you're more likely to end up with the UK version than you are with the EU version. The EU one is, in my view, less valuable than the UK one, but that really depends on who you are, what your market is, and where your biggest sales are. If your biggest sales are in Germany, you may not agree with that, and if you're in fashion, you may not agree with that because the EU type of design with the three-years but covering every aspect of the design is more relevant. So what I would say on that is do it from the UK, but publish it on a website that's definitely simultaneous, so maybe upload it to, from my view, an EU/UK aimed Instagram account, or something like that – a third party site that is clearly going to – it is not like you're putting on your UK version of the website and the EU version of the website and therefore, there's some argument that there were nanoseconds of difference between the two. If you've got a pan-EU, i.e. it applies to the UK and EU website, where, literally, if you upload it to one, it is instantly uploaded to the other, and I mean instantly, then I think there's a good argument that that would cover –you would get protection in both, because neither one can invalidate the other. That's my view, but be careful because I don't think that can go too far, I don't think that would necessarily apply if you only put it on a website that was viewable from the UK or EU but was aimed at US consumers, for example. I think you would have to argue, a bit like some of the cases in trademark law, that you have a website with these directly aimed at people in the market in the UK and in the EU. There are other ways of doing it other than just a website, you can do it as a sort of live stream, there are various things you could do, even if you don't actually want to put it on sale on your website yet. You could have a preview or a live stream or something, but obviously, it needs to be before you've disclosed it in real life in the country, so if you can't just do it for example, if you were doing it as a film from a catwalk show, if you had the camera at the end of the catwalk show, and people were coming out on the to show the products and your video was sort of a few seconds later, arguably it is been shown in real life in one or other destination first, so just think about that, but it is something to take advice on.
Mathilda: Thank you. Then another post-Brexit question actually: "After the end of the transition period, should we be thinking about WIPO designs?"
John: Yes. WIPO designs have not been particularly popular. It is called the Hague system, but they have not been particularly popular because of where they cover. They haven't covered some of the most important countries out there that you might want protection from – they've only recently covering the US and Japan, and as far as I understand it, China still isn't part of the system, although it is on its way in, so it is got a lot better over recent times. I would definitely consider it now. It is sold as being a cheaper system. You do not even need a base registration, you can apply straight to the WIPO, which makes it different to some other forms of international right. It is good, because what happens is your design in one country may literally not be able to be registered in another country because the rules, the requirements of the different registrants are such that actually some of them are directly opposite to each other. So in some, you're allowed the parts of an article, and in other countries, you're just not allowed to protect part of an article, and there are other things to do with how you're supposed to show your graphics, your pictures, your representations, which are directly contradictory. The idea of the WIPO Hague system is that it brings up the bar to a lowest common denominator where those requirements are harmonised such that there should be a minimum level that if you comply within the different requirements, you should be able to cover all the different jurisdictions, which is an advantage of it if you want to go for example, the US and Japan are very different in their requirements. If you want to protect them both in those, Hague may be useful because it actually changes the requirements needed to get protection, so definitely think about it. We don't actually register designs here at Gowling WLG but there are design attorneys out there who have done this before, and I would recommend you try and find one that's definitely done it before, because not all of them have, because it is a relatively, it is not a new system, but it is newly popular, so not that many people have experienced using it.
Mathilda: That is a helpful tip…and then, finally, in our last two minutes, we've got a question about do you have any guidance on the kind of evidence that we should be building or retaining to demonstrate the kind of necessary goodwill for post-sale confusion that you mentioned earlier?
John: Thanks, good question, and quite difficult to answer in two minutes flat, but really, it is about making sure that you focus on those elements that you're claiming are brand new elements. Where a lot of these cases fall down is that you are just actually later trying to claim rights in your packaging with no real evidence that your consumers necessarily recognise that packaging as being linked to you. You might think it is because you've been selling it for years but to the consumer, do they see that bottle shape and think "Ooh, that is a Yakult" or whatever it is….there are certain types of products where you really need to focus on that shape to make it something which is associated with your brand. Coca-Cola does it very well obviously with the Coca-Cola bottle – it is part of their advertising. Some of their advertising only has the bottle shape and does not mention Coca-Cola at all.
With the Freddy case, there was lots and lots of marketing which, yes, Freddy was written on the jeans, and it was written on a lot of the posters and things like that, but a lot of people recognise the product just by virtue of the shape of the product…."Oh, it is that product" – not necessarily knowing that it was called Freddy, and that's where, that's the sort of goodwill that you will need to be able to do it. The same with the red tag – if you saw the red tag on Levi's jeans, then you would think Levi's, even if you didn't see the word Levi's – that's the kind of recognition that you would need in order to succeed. It is not easy, but if you have done it in your advertising, your marketing, you have gone long – it is going to be easier.
Mathilda: Great, and with that, I think you have brought it in on the nail of 11:30, so thank you to John, and thank you everyone who has attended for joining us today. At the end of the session, a feedback form will appear on your screen. If you have a few moments, please do let us know your thoughts on today's webinar. We really do value your feedback, and it helps us to develop and improve these events. We have also been recording this session, and we'll email you a copy, along with links of the previous webinars and details of our final session on copyright in the new year. So thank you very much again for joining, and we hope that you have a great rest of your day.