LED Technologies Pty Ltd v Roadvision Pty Ltd [2011] FCA 146 (25 February 2011)

LEd Technologies Pty Ltd has again sought to protect their commercial position in an action for infringement of their australian registered design Nos. 302359 and 302360 before the federal Court of australia. as well as denying infringement, the respondents sought to invalidate the registrations. This case provides guidance in practical assessment of whether or not a registered design is “substantially similar in overall impression to another design”, which must be considered when determining infringement and validity of an australian registered design.

FACTS OF THE CASE

LeD Technologies Pty Ltd (“LeD Tech”) is the owner of Australian Registered Design Nos. 302359 and 302360 (“the registered designs”) in respect of “Rear Combination Lights”. Lights of this type are typically used on trailers and caravans for providing combinations of stop, park, indicator and reverse lights.  

LeD Tech had an agreement with a Taiwanese company, Valens Co Ltd (“Valens”), for the manufacture and supply of rear combination lights for vehicles according to the registered designs. In order to do so, Valens manufactured moulds, and it was a term of the agreement that Valens would supply to LeD Tech, and to no other party, lights manufactured using those moulds that were to be sold in Australian and New Zealand.  

After Valens ceased supplying LeD Tech with combination lights, Baxters Pty Ltd (“Baxters”) established an arrangement with Valens for the manufacture and supply of combination lights for Baxters to sell in Australia. Baxters had paid Valens for tooling of new moulds specific for the manufacture of the lights for Baxters. upon supply of lights from Valens, Baxters sold these lights in Australia.  

THE DECISION

Infringement of the registered designs claims

LeD Tech claimed that the respondents, Roadvision Pty Ltd and Baxters Pty Ltd, had infringed the exclusive rights provided by the registered designs. To this end, LeD Tech alleged that Baxters had sold rear combination lights (“the Baxters lights”) that are substantially similar in overall impression to the registered designs.

Finkelstein j stated at paragraph [94] that the party’s expert witnesses were asked to prepare a joint report that addressed:  

  1. what features of the overall appearance of the registered designs with the Baxters lights are the same or similar;  
  2. in relation to the identified similarities:  

a) how significant the feature is to the overall appearance of the article; and  

b) whether it is a feature that was used in relation to automotive lights in Australia prior to june 2004 [that is, before the priority date of the registered designs];

  1. in comparing the Baxters lights with the registered designs, what features are both different, and visually significant; and  
  2. in relation to the identified differences: a) how significant the feature is to the overall appearance of the article; and b) whether it is a feature that was used in relation to this type of article before the priority date of the registered designs.  

While the expert witnesses did not agree on all points, the joint report enabled Finkelstein j to focus on the similarities and differences and, using the factors set out in section 19 of the Designs Act 2003, draw a conclusion on whether the Baxters lights were substantially similar in overall impression to the registered designs. To this end, Finkelstein j found that many of the features of similarity were common in the prior art, and that certain features of the registered design were not present in the Baxters lights (at paragraphs [105] and [106]). As consequence, the overall impression of the Baxters lights was not substantially similar to that of the registered designs.  

Newness and distinctiveness of the registered designs

Baxters cross-claimed for revocation of the registered designs on the grounds that they were not new and distinctive. While extensive prior art was provided, a single prior art design (“the Rubbolite design”) was relied on, and discussed, in the challenge for lack of distinctiveness.

The expert witnesses were also asked to prepare a joint statement that identified what features of the overall appearance were the same or similar and visually significant between the Rubbolite design and the registered designs (at paragraphs [99] to [100]). The conclusion was made that the registered designs included several visual features that distinguished the registered designs from the prior art. Accordingly, Finkelstein j concluded that the registered designs were new and distinctive.

Alleged lack of certainty of the registered designs

Baxters claimed that the registered designs should also be revoked on the basis the registered designs “were impermissibly ambiguous and uncertain”. Finkelstein j stated at paragraph [82] that “the rule is that to be valid a design must be reasonably clear and succinct”. The position of Baxters’ expert witness was that the registered designs were “confusing” due to the lack of certainty in the Statement of Newness and Distinctiveness.

Finkelstein j did not accept that the Statement of Newness and Distinctiveness was uncertain because there is “nothing relevantly uncertain contained in the statement” (paragraph [85]).

Procuring a breach of contract claim

LeD Tech also claimed that Baxters had acted in a manner that procured Valens to breach the terms of their agreement with LeD Tech by using the moulds to manufacture lights for Baxters. To this end, LeD Tech alleged that Baxters had known of the terms of the agreement between Valens and LeD Tech; that Valens had used the moulds to manufacture lights for Baxters; and that Baxters had known or otherwise encouraged Valens to do so.  

The evidence showed that in manufacturing light lenses for the respondents, Valens had used some components of the moulds that had previously been used to manufacture lights for LeD Tech. Finkelstein j concluded that Baxters had thought that they were paying for the manufacture of new moulds that were to be used for the manufacture of lights for supply to them. Significantly, Baxters had not asked Valens to use parts of the existing light moulds; it was Valens who had made this choice, and thus it was Valens who had decided to breach its agreement with LeD Tech. For this reason, the procuring a breach of contract claim was dismissed.

COMMENTARY

The decision highlights the difficulty in comparing two designs for the purposes of assessing validity and infringement. One of the main criticisms of Australia’s previous designs law was that when a registered design was compared with an alleged infringement too much weight was placed on visual differences between the registered design and the infringement. The consequence of this was that a product could avoid infringing a registered design with minor differences in its visual features. A similar criticism existed when comparing a registered design to a prior art design when assessing validity.  

The tests for assessing validity and infringement under the current Australian Designs Act 2003 (“the Act”) are similar in that both require two assessments: first, whether the two designs being compared are identical; and second, whether the two designs are “substantially similar in overall impression”. To address the criticisms outlined above, the Act attempted to shift the emphasis when requiring that the person making the assessment “give more weight to similarities between the designs than to differences between them”.  

The joint statement was an attempt to meet the requirements of the Act by systematically documenting the similarities and differences, and assessing the visual significance of these to the overall impression. The Court concluded that the similarities between the registered designs and the Baxters lights related to features that were common in the prior art. The Court concluded that the visual differences resulted in the registered designs having a different overall visual impression to the Baxter lights.

The Act does not provide a clear ground for challenging the validity of a design on the basis that its scope is unclear due to poor quality of representations, or lack of clarity in the Statement of Newness and Distinctiveness. It is unfortunate that there was limited discussion on this aspect in the decision. However, the decision does make it clear that the Court will go to some lengths to construe a Statement of Newness and Distinctiveness that “could have been better expressed”