Late last week, the Full Federal Court of Australia handed down its decision in Chiropedic Bedding Pty Ltd v Radburg Pty Ltd [2008] FCAFC 142 (link http://www.austlii.edu.au/au/cases/cth/FCAFC/2008/142.html ).

Background

In 1996, one week prior to filing an application for a registered design in a mattress, Chiropedic exhibited its design at the "The National New Products Parade" (a trade fair held at the Melbourne Exhibition Centre between 20 July and 23 July 1996). Chiropedic’s design was eventually registered, protecting it from third party use.

Radburg began applying a similar design on its own products. Chiropedic commenced design infringement proceedings against Radburg on the basis of its registered design.

The Chiropedic Registration

Radburg defended the infringement action by alleging that the registration was invalid. It claimed that because the mattress design was shown at the 1996 trade fair prior to Chiropedic’s design application, the design was disclosed prior to the application being made, was therefore not novel at the time of the application, and, consequently, invalid and unenforceable.

The Law

Normally, designs must be “novel” to be registered. Disclosure of a design prior to filing an application for its protection can jeopardise its novelty, and invalidate an eventual registration. However, under the Designs Act 1906 (which has since been superseded by the Designs Act 2003, but applied to the circumstances in Chiropedic) there is an exception to this potential pitfall: novelty will not be destroyed where disclosure occurs at “an official or officially recognized international exhibition” and registration is sought no later than six months from this disclosure.

The Result

Chiropedic argued that its registration was valid because the "The National New Products Parade" was “an official or officially recognised international exhibition”, and it applied for registration of the mattress design well within the 6-month period for doing so. At trial, the Federal Court (Finkelstein J) found that the fair had sufficient government ties to be “officially recognised”, but found that it was not sufficiently “international” for the exception to apply. At the fair, 250 Australian businesses displayed their products. New Zealand was the only other country represented, with 7 exhibiting businesses. The Court found this insufficient for the fair to be described as “international”, and said that the fair was better described as “regional”.

This finding was overturned by the Full Federal Court (Rares and Besanko JJ, as well as newly-appointed High Court Chief Justice Robert French):

In our respectful opinion, the trial judge erred in formulating a test of "international" which involved the need for a significant foreign presence…the fact that there were exhibitors from Australia and New Zealand was sufficient to make the fair an "international" exhibition…

On this basis, Chiropedic’s registration fell within the exception and was maintained.

International Impact

The exception at issue in Chiropedic is worded identically to an exception contained in Article 11 of the Paris Convention for the Protection of Industrial Property (“the Paris Convention”). While the Full Court in Chiropedic explicitly stated that it was interpreting the Australian Designs Act 1906 (and not the Paris Convention), it is clear that the Paris Convention exception has created legislative footprints in a number of countries. Most notably, the same “official or officially recognised international exhibition” exception is also found in Article 44 of the European Community Design Regulation 2002 (which provides for both registered design rights and copyright-like unregistered design rights throughout the European Community). The Full Federal Court’s decision in Chiropedic is a rarity: the wording of the exception – which, under the Community Design Regulation, could mean the difference between a 25 year design monopoly, or no monopoly at all – has seldom been invoked in litigation in Australia or anywhere else. Due to the identical wording of the exception as it appears in the Designs Act 1906 and the European Community Design Regulation 2002, it will be interesting to see whether the Full Court’s reasoning gets picked up in the UK, Ireland, or other EC countries as litigation based on the young Community Design Right becomes more prevalent.

Actuate Legal acted for Chiropedic, and has experience in dealing with both Australian and European Community Design Rights.