In this case, the statement of novelty was to the shape and configuration of the upper layer of the mattress portion of the mattress and base as indicated by the beading as shown in the representations.  A representation of the registered design is shown below.

When considering the prior art, Jessup J paid particular attention to the upper layer of the prior art mattress portions in finding that the prior art mattresses were not anticipatory.

In considering whether the respondent’s beds infringed the design registration, His Honour confirmed that the Court must be informed by the nature and extent of the differences by which the registered design was differentiated from the prior art, and noted this was:

pre-eminently a case in which, for that reason, small differences in shape or configuration will enable an article to escape a finding of infringement (emphasis added).

His Honour went on to find that only two of the respondent’s beds infringed the applicant’s design registration.  An injunction restraining sales of those two beds was granted to the applicant, along with an order for an account of profits.

The importance of the statement of novelty in defining the scope of a registered design is illustrated in this decision, as is the potential for a Court to disapprove of a design owner who tries to downplay the significance of a statement of novelty when infringement proceedings arise.

Regarding the appropriate construction of the claim, the Court held the patentee to the construction advanced before the primary judge that the aseptic package was an essential integer of the combination which was the subject of the claim. The Court then considered the decision of Dixon J in Palmer v Dunlop Perdriau Rubber Co Ltd in relation to the notion of a collocation of integers, concluding that:

for the claim of a combination patent to remain valid, the integers must interact to bring about the desired result — in this matter, the application of negative wound pressure.

Assessing whether the packing did so interact, the Court stated:

how, if at all, does the aseptic package interact with the other integers to produce the result of negative wound pressure. It is the mere bag in which the device that ‘does the work’ is stored before use. It is discarded before any negative would pressure is applied. No doubt it is beneficial to have sterile packaging for a therapeutic device, however, the aseptic bag itself does nothing to cause, limit or affect the functional result of negative wound pressure as desired.

While the patentee referred to earlier decisions supporting the proposition that the presence of the additional integer of the aseptic packaging did not affect the validity of the claim, the Court distinguished those cases on the somewhat confusing basis that “those authorities are relevant to an additional integer that limits the scope of the claim, not an integer said to limit the invention”.

The Court concluded that the claim was invalid because:

While the integers that form the actual apparatus might be said to be a new combination, when placed with the essential feature of the aseptic package being part of the invention claimed they form a mere collocation of the apparatus on the one hand and the aseptic package on the other.

While this somewhat confusing decision may be limited to a very specific factual scenario, it illustrates how crucial claim drafting can be. The fact that the claim was directed to an apparatus for a specific purpose rather than just the apparatus itself seems to have played a significant role in the finding of invalidity.

Background

The defendant, Primary Distributors New Zealand Ltd (PDNZ) was the exclusive distributor of the HEFTY range of cling-film wraps, papers and domestic products in New Zealand from the mid-1990s.  In 2005 the owner of the HEFTY trade marks was placed in receivership and PDNZ entered into a strict three month licence agreement to sell the remaining HEFTY stock in New Zealand.

When the owner of the HEFTY trade marks went into liquidation, PDNZ attempted to purchase the HEFTY marks in New Zealand.  On the assumption that the trade marks would soon be owned by either itself or its established supplier (a Thai entity which was also bidding for the marks), PDNZ continued to purchase and import HEFTY products directly from Thailand and to sell these products in New Zealand.

Unbeknown to PDNZ, the appellant Intellectual Property Development Corporation Pty Ltd (IPDC) was also negotiating to purchase the HEFTY trade marks, which were assigned to IPDC in December 2005.  The assignment included the right to sue and claim (and retain) any damages and other remedies for past infringements of the trade marks.

In early February 2006 PDNZ became aware that a different party had acquired the New Zealand trade marks, yet continued to import and distribute HEFTY products up until June 2006, while undertaking preparations to launch a new brand of cling-wrap film.

The date when IPDC first became aware of PDNZ’s actions was debated by the parties.  However, IPDC contacted PDNZ in July 2006 seeking undertakings to cease distribution and also financial compensation.  IPDC then commenced trade mark infringement and passing off proceedings at the High Court of New Zealand.

While PDNZ accepted that it had infringed the trade marks, it argued that IPDC was aware of the infringement occurring during the latter part of the infringement period yet took no action, and therefore should not be entitled to an account of profits for that period.   At first instance, Asher J held that IPDC became aware of the infringement on 18 January 2006 and restricted the period of the account of profits up to this date.

Court of Appeal Decision

Before the court of appeal, IPDC argued that Asher J was wrong to restrict the period of the account of profits merely on the basis of a five month delay in commencing proceedings. The Court considered that a delay of five months, on its own, should not deprive IPDC of a remedy.

The Court then considered whether any other factors influenced Asher J’s decision to deny a remedy for part of the infringement period.  The main additional factor appeared to have been that IPDC had suffered no additional loss (as it was not in a position to trade itself in that period) and that awarding it an account of profits “may give [it] a boon it has not earned and indeed may reward its failure to protest”.

The Court of Appeal noted that for a remedy to be denied because of factors outside the recognized defences (laches or acquiescence in this case), there would need to be an element of unconscionability involved, stating “there is no duty on a trade mark owner to protest, and it must not be lost sight that PDNZ is the wrongdoer”.

Further, in considering the nature and purpose of an account of profits, the Court of Appeal noted that this remedy is designed to prevent unjust enrichment and concentrates on the wrongful actions of the infringer, and not on the position or the actions or omissions of the owner.  Therefore, the Court held that the fact that IPDC was not in a position to exploit the trade marks was irrelevant and should not have been taken into account by Asher J.

Indeed, the Court considered that PDNZ may have been more culpable in the first half of 2006 than in the earlier period of infringement, as it knew for certain by this time that its attempt to purchase the trade marks had been unsuccessful and that a third party had done so.

The account of profits was ordered for the whole period claimed and the matter was remitted back to the High Court to reconsider further issues raised at the appeal.

The hearing officer also considered that the opposed mark was not substantiality identical to either the TIFFANY or TIFFANY & Co marks owned by the opponent, noting that “for aural confusion to arise between KOURY and & Co, an exceptional degree of slurring or carelessness of pronunciation would need to be exercised”.

On the question of deceptive similarity, the hearing office considered what were said to be a family of TIFFANY marks owned by the opponent but concluded that:

Although TIFFANY is an identifiable word in the IRDA, TIFFANY KOURY, it is not highlighted or presented in such a way that it would be seen as the dominant or memorable element of the mark, and does not retain a trade mark identity within that mark. Rather, it presents as a female first name. The word KOURY, being an uncommon surname in Australia, is likely to be the more memorable element. When the IRDA is considered as a whole and each of the elements given its fair weight, the net impression it creates is that of the full name of a female person. Because they create very different impressions they are unlikely to be confused for each other or viewed as belonging to a family of “Tiffany” trade marks.

Accordingly, the section 44 ground of opposition was dismissed as were related grounds under sections 42(b) and 60. All other grounds of opposition were also unsuccessful, resulting in protection of the IRDA being extended to Australia.

Schutz, a provider of new Composite IBCs as also engaged in the reconditioning of used IBCs and having them recertified.  VIP had entered the reconditioning market and sold “Cross-bottled” Composite IBCs, being IBCs having a Schutz outer case and a VIP inner container.  The exterior casing of the reconditioned Composite IBCs sold by VIP continued to bear Schutz’s trademark and in some instances Schutz’s original UN certification (UN model regulations require Composite IBCs to be tested to ensure that they meet a certain standard.  Only those Composite IBCs that have passed the mandatory tests are certified for use in the transport of dangerous goods and they must bear standardised labelling).Schutz alleged that VIP’s conduct was misleading and deceptive and therefore in breach of sections 52 and 53 of the Trade Practices Act in that consumers could be misled into believing there was an affiliation between Schutz and VIP or that the cross-bottling of the Composite IBC was authorised by Schutz.  The Court accepted that consumers may have been so misled.

Schutz also argued that VIP’s conduct gave rise to a further misrepresentation that the Composite IBC’s supplied by VIP were of the same quality and standard as the Schutz product and continued to comply with UN certification.

The Court found that Schutz’s concerns, as well as concerns that consumers may mistakenly believe that the reconditioned products were suitable for the transport of dangerous goods, were negated by VIP providing undertakings:

a) not to sell the goods as being suitable for this purpose and

b) to affix a warning label on the goods which also explained the nature of Schutz’s and VIP’s connection with the goods and that the goods were not for the storage or transport of dangerous goods.

On the basis of those undertakings, the Court refused to grant interlocutory relief.

The case illustrates that where the issue of potential unrepairable harm can be minimised by practical measures such as corrective labelling, this can stymie an Applicant’s claim for interlocutory relief.