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1 May 2013Henning Hartwig

From idea to design: protection under the 'grace period' in Europe

It is a long way from some initial sketches to a final product. Doubts and concerns may arise as to whether the original idea will fly. While mid-sized companies and global players alike are used to taking such risks and spending time and money to find out, small entities and individuals (inventors, creators, authors, designers, etc) may be discouraged. They might also be concerned that their know-how (sketches, prototypes, etc) will be copied either exactly or to a substantial extent when being disclosed to potential partners.

This happened to a Chinese company which offered sketches of the design of a bakery press to the German retailer Tchibo. After initial negotiations, Tchibo refused to cooperate with the Chinese manufacturer but placed on the German market a nearly identical copy of the Chinese design—made in China by another Chinese producer.

What went wrong, and what could have been done to prevent it? One answer is design protection, which in Europe is not limited to European players—both individuals and companies are allowed to seek protection for new designs with individual character under the umbrella of the ‘Community design’, irrespective of whether they are citizens of, or established and/or domiciled in, the EU or abroad.

What counts is whether the design to be protected has been disclosed in the EU. If disclosed in Europe, protection by way of a so-called unregistered Community design (for a three-year term) is possible (in addition to filing an application for registration of a Community design). If the design was disclosed outside the territory of the EU, protection by way of registration is the only option.

In the bakery press case, the Chinese manufacturer of the original press started seeking protection in China, obtaining a Chinese design patent registration published on May 8, 2002. However, given that the Community design regime did not allow applications before April 1, 2003, the Chinese company was not able to extend the Chinese protection to Europe by way of claiming priority under the Paris Convention within six months of filing. Otherwise, claiming priority would have been an option to safeguard design rights in Europe originally established abroad.

But what if the company or individual—be it European or Asian or American—does not wish to spend the (low) costs to protect the design in Europe before testing the market? This is the underlying assumption for establishing what European design lawyers call the ‘grace period’—a unique concept which is unknown to European patent law and probably also to major foreign design law jurisdictions.

The grace period

Pursuant to Article 7(2) and (3) of the Community Designs Regulation (CDR), a disclosure of a design to the public will not be detrimental to the novelty or individual character of a registered Community design (RCD) during the 12 months—the grace period—preceding the date of filing (or priority date) of the application for the RCD if the design was (in Europe or abroad) disclosed:

I. By its designer, his or her successor in title, or a third person as a result of information provided or action taken by the designer or his successor in title (Article 7[2] lit a CDR); or

II. As a consequence of an abuse in relation to the designer or his successor in title (Article 7[3] CDR).

The purpose of the grace period is to enable the designer to test the product, or a variant thereof, on the market (in Europe or abroad) before incurring the costs (low as they may be) for registering a Community design. According to the Office for Harmonization in the Internal Market (OHIM), this concept is “particularly useful for small businesses since they frequently lack the money to finance systematic registration of designs, which may or may not be successful on the market”.

Thus, the ‘standard situation’ covered by the grace period is to protect an RCD from challenges to its validity based on prior publication of the same or a similar design.

Pitfalls to be avoided when relying on the grace period

At first sight, the grace period appears quite attractive for small and medium-sized businesses. However, there are two main reasons which may speak against the grace period and suggest seeking early registration of an RCD instead.

First, as already indicated, a similar or any grace period is not universally recognised, and any protection sought outside of Europe may become unavailable because of the prior disclosure of the design by the designer him/herself or on his/her behalf (if the only market of interest is the EU, this argument of course does not apply).

“THE OFFICE FOUND THAT PUBLICATION BY BOTH THE ORIGINAL DESIGNER, AND THE PERSON HAVING COPIED THE ORIGINAL DESIGN, CONSTITUTE PUBLICATION OF THE SAME DESIGN.”

Second, the grace period does not provide protection or shelter when a third party has developed and disclosed a similar design (second design) independently before the filing date of the first RCD. This second design may then be a ground of invalidity. Therefore, the grace period does not provide protection when an independently developed design is made available to the public (intermediate publication) prior to the filing date, or priority date if any, of the RCD.

The grace period protects only against the designer’s own publication or a publication made on his/her behalf. In these situations, the publication of the second design in the period between the publication of the first design, for which the grace period applies, and the filing date (or priority date if any) constitutes relevant prior art.

Dependent intermediate publication

If the intermediate publication is of a design copied from the previously published design, the grace period does not apply then either, unless the RCD proprietor can claim that the intermediate publication is the result of “information provided or action taken by the designer or his successor in title” (Article 7[2] lit a CDR), or that the publication is the consequence of an “abuse in relation to the designer or his successor in title” (Article 7[3] CDR).

However, Article 7(3) CDR does not seem to apply as mere copying does not amount to an “abuse”. Such abuse would require some action on behalf of the person publishing the copied design which is against accepted morals or practices, such as theft, illicit access to data, unauthorised disclosure by employees of the designer or the successor in title, etc.

The result would be that a person having published a design copied from the first design can defeat a later RCD registration. That appears inequitable. It has been suggested therefore that the intervening publication of a copy of the original design should fall under Article 7(2) lit a CDR, as having been derived from, or being based on, information made available by the original designer. The intervening publication would then also fall within the one-year grace period and would not constitute prior art.

Case law

Unfortunately, very little case law can be identified in this context in order to have further guidance beyond the mere text of the law and a balance of interests. In fact, two decisions were handed down in 2010—both final—by the competent invalidity division of OHIM (decision of September 21, 2010: Case ICD 5672 Ligna v Mebelplast; decision of December 7, 2010: Case ICD 6682 J. Neves v PAL).

In these cases, the office found that publication by both the original designer, and the person having copied the original design, constitute publication of the same design, which, if within one year of the filing (or priority) date of the subsequent RCD, entitles the designer to claim the grace period.

Similarly, OHIM’s Board of Appeal clarified only recently that Article 7(2) CDR is not limited to the disclosure of the design itself by the RCD proprietor but applies also to any subsequent ‘copies’ disclosed by third parties based on or derived from this disclosure (decision of May 2, 2011: Case R 658/2010-3 Guiyuan Zhang v Aerospace). In the underlying case, the designer of the contested RCD disclosed the design during a trade fair (CEBIT 2007).

During a later trade fair (IFA 2007), the applicant for a declaration of invalidity, a competitor of the proprietor, showed a design producing the same overall impression as the previously disclosed design. The RCD proprietor was entitled to rely on the grace period not only for his own disclosure at CEBIT 2007, but also on the IFA disclosure by the invalidity applicant, because that design had been copied from the earlier CEBIT disclosure.

One should consider this result to be appropriate, but there remains a certain risk that courts will interpret Article 7(2) lit a CDR differently and require some active participation by the original designer in the publication of his/her design. Consequently, filing a registration as early as possible will help to minimise the amount of prior designs potentially detrimental to the validity of the later RCD.

The author would like to thank Eva Maierski, trainee lawyer with Bardehle Pagenberg, for her valuable additions, suggestions and discussions in the course of finalising this article.

Henning Hartwig is a partner at Bardehle Pagenberg in Munich. He can be contacted at: hartwig@bardehle.de

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