August 19, 2015
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Nelligan O'Brien Payne gratefully acknowledges the contribution of Natasha Chettiar, Student-at-Law in writing this blog post.

Recently, the Federal Court of Appeal broadened the application of the Industrial Design Act in regards to functional features. In its May 2015 decision Zero Spill Systems (Int’l) Inc v Heide, the Court addressed how the Act applies to disputes where common design features include functional purposes. In an exercise of statutory interpretation, the Court found that the words of the Act allow for more flexibility than previously thought. The judgment held that features of a design may be both functional/useful and aesthetic/visually appealing. Thus, the Court left room for more industrial designs to be enforced, as only those designs whose features are dictated solely by function are not protected.

The trial

At trial, the Plaintiff, licensee of Canadian Industrial Design 86,793 or the “Zero Spill design”, alleged design infringement. The Plaintiff had produced a tray designed to capture fluids that either leak or are spilled during oil field operations. The Defendant had produced a similar tray, and acknowledged that the design was based upon the Zero Spill design.

In examining the claim, Justice Barnes considered whether the Defendant’s tray duplicated the visual features of the Zero Spill design. In comparing the features of the two trays, Justice Barnes held that there was no evidence indicating that there were any common features between the Zero Spill design and the Defendant’s design that were anything other than functional. Focusing on function, Justice Barnes’ decision applied section 5.1(a) of the Industrial Design Act, and decided the Zero Spill design could not be enforced be the Act. According to Justice Barnes, industrial design protection does not extend to “features applied to a useful article that are dictated solely by a utilitarian function of the article”.

The appeal

Engaging in statutory interpretation, the Federal Court of Appeal found that Justice Barnes erred in his application of the law. The error, the Court stated, was twofold.

First, Justice Barnes found that Zero Spill failed to prove that its design complied with section 5.1(a). The Court clarified that the burden of invoking paragraph 5.1(a) is not on the plaintiff, but, rather, falls on the defendant. Therefore, it was the accused that had to plead and prove that features of the design were dictated solely by function and were therefore unenforceable by the Act. As the Defendant was not required to put forward evidence relating to the compliance of Zero Spill’s design with section 5.1(a) at trial, and as the Plaintiff was faulted for its lack of evidence, the Court held that Justice Barnes’ finding of non-infringement could not stand.

Second, the Court reversed Justice Barnes’ finding that all features of an industrial design that are functional are unenforceable by virtue of section 5.1(a). In an examination of the words of the Act and the specific section, the Court found that in “the ordinary meaning of paragraph 5.1(a), functional features of an industrial design may be protected by the Industrial Design Act.” The Court went on to emphasize the presence of the word “solely” in section 5.1(a), clarifying that this indicates that features may be simultaneously useful and visually appealing, and still be protected. As such, the Court reversed Justice Barnes’ decision, and found that the Zero Spill’s design had available protection under the Act.

The takeaways

The main takeaways from the Court of Appeal’s decision may be summarized as follows:

1. Without a registered industrial design, there can be no basis for infringement. With a registered design, one has the right to sue for industrial design infringement, and the law recognizes a presumption of validity. That presumption takes for granted that the registered industrial design complies with the Industrial Design Act.

2. The onus is on the alleged infringer to plead invalidity. If invalidity is not raised in the defence, and evidence is not raised on this issue, then the court cannot make a determination of invalidity.

3. Functional features of an industrial design may be protected by the Industrial Design Act. By the words of section 5.1(a) of the Act, features that are dictated solely by a utilitarian function of the design are ineligible for protection. Therefore, “features may be simultaneously useful and visually appealing.” In clarifying its position, the Court even stated that the Industrial Design Act would serve no purpose if it did not protect functional features.

Each of these conclusions clarified the application of the Industrial Design Act. However, it is the third takeaway that may truly generate waves in future design infringement cases. With the Court of Appeal leaving the door open for deeper analysis as to what is dictated solely by function and what is actually at once both functional and aesthetic, we may see interesting applications of the Industrial Design Act to come.

This content is not intended to provide legal advice or opinion as neither can be given without reference to specific events and situations. © 2017 Nelligan O’Brien Payne LLP.