Re Shimano Industrial Company Ltd v Silstar Australia Pty Ltd [1991] FCA 31; 20 IPR 451 (15 February 1991)

FEDERAL COURT OF AUSTRALIA

Re: SHIMANO INDUSTRIAL COMPANY LTD.
And: SILSTAR AUSTRALIA PTY. LTD.
No. G511 of 1989
FED No. 26
Designs
(1991) AIPC para 90-802
[1991] FCA 31; 20 IPR 451

COURT

IN THE FEDERAL COURT OF AUSTRALIA
NEW SOUTH WALES DISTRICT REGISTRY
GENERAL DIVISION
Beaumont J.(1)

CATCHWORDS

Designs - alleged infringement - alleged invalidity of registration under Designs Act 1906

HEARING

SYDNEY
15:2:1991

Counsel and Solicitors applicant: Mr M.R. Ellicott instructed by

Minter Ellison

Counsel and Solicitors for respondent: Mr T. Tobin QC with
Mr T. Golding instructed by
Maurice Freidman and Co.

ORDER

Application dismissed.

Cross-claim dismissed.

Note: Settlement and entry of orders is dealt with in Order 36 of the Federal Court Rules.

DECISION

By its statement of claim, the applicant, Shimano Industrial Company Limited ("Shimano") alleges that the respondent, Silstar Australia Pty. Ltd. ("Silstar"), has infringed Shimano's statutory monopoly in certain designs registered pursuant to the Designs Act 1906 ("the Act"). By its defence, Silstar denies any infringement. By its cross-claim, Silstar seeks an order of rectification of the Register of Designs by expunging the entries of Shimano's registration from the Register.

2. The two designs in question are registered No. 95216 and No. 95217. In the case of each design - (a) the article in respect of which the design is registered is "a fishing reel"; (b) the statement of monopoly is claimed "in the shape and configuration of a fishing reel as illustrated in the representations"; (the respective representations are set out below); (c) the term of the initial registration was one year commencing on 12 February 1987 (and since extended to 21 November 1991); and (d) the Convention Priority Date was 30 May 1985.

3. In respect of design No. 95216, the representations are as follows:

4. In respect of design No. 95217, the representations are as follows:

(DESIGNS Nos. 95216 and 95217 OMITTED)

5. By its statement of claim, Shimano alleges that Silstar has, without the licence or authority of Shimano (and no such licence or authority is suggested): (1) imported into Australia for sale, or otherwise for the purposes of trade or business, fishing reels to which Design No. 95216, or a fraudulent or obvious imitation of that design, has been applied (para 5(a)(ii)); (2) Promoted offered for sale and sold in Australia fishing reels to which Design No. 95216, or a fraudulent or obvious imitation of that design, has been applied (para 5(a)(iii)); (3) promoted, offered for sale and sold in Australia fishing reels to which Design No. 95216, or a fraudulent or obvious imitation of that design, has been applied outside Australia (para 5(a)(iv)).

6. Similar allegations are made in respect of Design No. 95217 (para 5(b)).

7. By s.25 of the Act, the owner of a registered design has a monopoly in that design. By s.4 of the Act, "design" means "features of shape, configuration, pattern or ornamentation applicable to an article, being features that, in the finished article, can be judged by the eye, but does not include a method or principle of construction"; "monopoly", in relation to a design, means the "exclusive right to apply the design to an article in respect of which the design is so registered"; and "statement of monopoly", in relation to a design, means "a statement relating to the representations of an article to which the design is applied that indicates - (a) those features of the representations in respect of which the applicant for registration of the design wishes to claim a monopoly; and (b) those features of the representations that are to be disregarded in considering the extent of the monopoly protection". By s.30(1) of the Act a person shall be deemed to infringe the monopoly in a registered design if he, without the licence or authority of the owner of the design - (1) imports into Australia for sale, or for use for the purposes of any trade or business, any article in respect of which the design is registered and to which the design or any fraudulent or obvious imitation of it has been applied outside Australia without the licence or authority of the person who was the owner of the registered design at the time when the design or imitation was applied; or (2) sells, or offers or keeps for sale or hires, or offers or keeps for hire, any article - (a) to which the design or any fraudulent or obvious imitation of it has been applied in infringement of the monopoly in the design; or (b) in respect of which the design is registered and to which the design or any fraudulent or obvious imitation of it has been applied outside Australia without the licence or authority of the person who was the owner of the registered design at the time when the design or imitation was so applied.

8. By s.30(2) of the Act, it is provided that if any person infringes the monopoly in a registered design, the owner of the design may bring an action or proceeding against him for infringement. By s.32 of the Act, a defendant in an action or proceeding for the infringement of the monopoly in a registered design may apply, by way of counter-claim in the action or proceeding, for the rectification of the register by the expunging of the entry of the registration of the design.

9. By its cross-claim, Silstar alleges that each of the registered designs is invalid. Silstar says that each design was not a new and original design; that each design differs only in immaterial details or in features commonly used in the relevant trade from a design that was published or used in Australia; and that each design is an obvious adaptation of a design that was published or used in Australia. Silstar relies upon s.17(1) of the Act which provides that a design shall not be registered unless it is a new or original design and, in particular, shall not be registered in respect of an article if the design (a) differs only in immaterial details or in features commonly used in the relevant trade from a design that, before the priority date in respect of the application for registration, was registered, published or used in Australia in respect of the same article; or (b) is an obvious adaptation of a design that, before the priority date in respect of the application for registration, was registered, published or used in Australia in respect of any other article.

10. The article to which the designs the subject of the litigation have been applied is a fishing spinning reel. In order to understand the issues between the parties, it is necessary to refer to a description of the major parts of the article in Design No. 95216 and No. 952l7 and their configuration prepared by an expert witness, John Redmond, Head, Department of Industrial Design, The University of New South Wales, as follows:

(DESIGN OMITTED)

11. In support of its claim of infringement, Shimano relies on the expert evidence of Mr. Redmond. In his report dated May 1990 and in his affidavit sworn on 5 June 1990, Mr. Redmond compared Design No. 95216 and No. 95217 with the Silstar GXB 60 fishing reel. Mr. Redmond's report contained the following photographs of the Silstar reel:

(PHOTOGRAPHS OMITTED)

12. In his affidavit, Mr. Redmond expressed the following opinions:
(a) Configuration, proportions, sculptural form, line/shape and surface

detailing are crucial factors in the registered designs and the Silstar
product. In these respects, the three designs have a similar appeal to
the eye. (Mr. Redmond is of the view that Design No. 95216 and Design
No. 95217 are "almost identical". The only difference is that, in No.
95216, the rear of the leg is split in such a way that it forks - this
is additional to the front and rear forking. However, this is designed
so that the "continuity of the overall form of the leg is maintained".
This is absent in No. 95217 in which the surface is shown as
continuous.)

(b) The crucial elements of the three designs that give them their

particular and similar "gestalt" are: (1) the integration of the
gearbox/body with the leg; (2) the V shaped configuration of rear of
leg with main axis; (3) the trigger-like bait feeder lever; (4) t he
particular proportions; (5) the particular forking of the leg; (6) the
particular overall configuration.

(c) The overall configuration of the designs is an aspect of the nature

of the article.

(d) The design features that are present in the registered designs are

present to a substantial degree in the Silstar design, and give it a
similar visual appeal. Whilst there are a number of differences of
detail, this does not detract from the similarity of "the overall
integrative gestalt" in the designs now in question. The sum of the
individual parts in the total design in each case is the same even
though differences of detail may be observed upon close examination.

13. In support of its cross-claim for rectification of the Register, Silstar relies upon the evidence of its managing director, Brian Derek Hale, in his affidavit sworn 26 June 1990. Mr Hale's evidence established that, prior to the relevant priority date, i.e., 30 May 1985, a number of fishing reels, claimed by Silstar to embody substantially the same design as the registered designs, were offered for sale in Australia. Similar evidence was given by Michael Kinross Willis, in his affidavit sworn 26 June 1990, Bruce Ian Hamilton, in his affidavit sworn 26 June 1990, Robert James Harrison, in his affidavit sworn 1 August 1990 and Jeffrey Robert Niven, in his affidavit sworn 5 July 1990.

14. In resisting Silstar's cross-claim, Shimano relies upon a further affidavit of Mr Redmond sworn 24 August 1990 referring to a report prepared by him dated August 1990 describing the alleged prior art. In his report, Mr Redmond expressed the opinion that "the overall design shown in (the registered designs) is not revealed in the 'prior art'....It should be noted that certain of the individual features are shown or hinted at but not in the particular combination that makes the (registered) designs distinctive and appealing."

15. Mr Redmond and Mr Hale gave oral evidence in chief. Each was cross-examined.

16. It is convenient to deal first with Silstar's cross-claim.
The claim for rectification of the Register

17. On behalf of Silstar, the following submissions were put in support of its claim that the registration was invalid:

1. The concepts "new" and "original" in s.17 of the Act are different
(see Malleys Ltd. v. J.W. Tomlin Pty. Ltd. [1961] HCA 77; (1961) 35 ALJR 352 at
p 353). There must be an idea or intellectual activity so as to
originate, that is to say, to suggest for the first time, something
which had not occurred to any one before as to applying by some manual,
mechanical, or chemical means some shape to some special subject-matter
to which it had not been applied before (see Dover Limited v. Nurnberger
Celluloidwaren Fabrik Gebruder Wolff (1910) 2 Ch 25 at pp 29-30; Macrae
Knitting Mills Limited [1936] HCA 43; (1936) 55 CLR 725 at p 730). There must be
substantial novelty in the design having regard to the article (see Le
May v. Welch (1884) 28 Ch D 24 at pp 34-5).
2. The registered designs lack the requisite novelty and originality:
(a) The designs lack sufficient individuality of appearance to
distinguish them from the fundamental form of the fishing reel (see
Malleys' Case at pp 352-3). (b) Individuality is to be determined by
the eye, not by measuring dimensions (ibid). (c) The designs do not
represent any distinct departure from the prior art. (d) The subtle
differences which may constitute a sufficient novelty in the case of an
article such as a chair (see D. Sebel and Co. Ltd. v. National Art Metal
Co. Pty. Ltd (1965) 10 FLR 224 are not apposite or analogous to an
object like a fishing reel (see at p 227).
3. The prior art shows that the design features alleged to give the
registered designs their distinctiveness were anticipated. These design
features are: (i) the integration of the leg of the mounting arm with
the body of the reel; (ii) the v-shaped configuration of the rear of
the leg with the main (horizontal) axis; (iii) the trigger lever; (iv)
the particular proportions; (v) the forking of the leg; (vi) the
particular overall configuration.
4. Alternatively, the issue of novelty and originality may be
approached in another way, that is, by reference to the statutory
exceptions of "trade variants" and "immaterial details" contained in
s.17(1)(a) of the Act.

18. As to trade variants: (a) The features commonly used in the trade can be identified from the fishing reels tendered in evidence, the evidence of their sale, certain published patent drawings and the prior art (see Sebel and Co. Ltd's Application (No. l) (1959) RPC 12 at p 18). (b) Substantial novelty is required for registration of new combinations of old design elements (see J. Rapee and Co. Pty. Ltd. v. Kas Cushions Pty. Ltd. (1989) 90 ALR 288 at pp 300-2). (c) The six elements described in para 3, above are not novel. The nearest approach to novelty was the application of a lever (the "trigger" lever) which, in design terms, was simply the substitution of a known alternative, i.e., the raised rear switch of the prior art.

19. As to immaterial details, a substantial difference from the fundamental form and from the development in the trade up to the priority date is required (see D. Sebel and Co. v. National Art Metal, above, at p 227). None of the six elements relied on by Shimano (see 3, above) satisfies this test. The cowling over the rear knob; the movement of the trigger lever so as to operate on a different plane from its predecessors; and certain detailing on the body are not substantial differences. These are the only changes which do not have strong design predecessors in the prior art. Whatever significance the bait-runner switch may have had from a mechanical viewpoint should not affect consideration of whether it is, in design terms, a substantial difference (see Macrae's Case, above, at p 730).

20. In its evidence, Silstar referred to many examples of what it claimed was the prior art. In the submissions put on its behalf, Silstar concentrated attention on only some of these. I propose to deal with what would appear to be the more significant items.

21. In "Australian Fishing Tackle Buyer: 1984-85", a magazine published in approximately August 1984 (Ex. 2), the following reel was advertised (at p 32):

(DESIGN OMITTED)

22. With respect to the Ryobi SL series, Mr Redmond said, in cross-examination, that, to some extent, the effect of the rear catch was to break the silhouette of the strong angle formed by the rear of the body. There appears to be a rear knob present. To some extent, the mounting area appeared to be integrated with the body of the reel by virtue of the strong angulation from the rear of the body through the mounting arm. This was similar, although possibly not as sharp, as the registered designs.

23. In re-examination, Mr Redmond said that the Ryobi SL series had an appeal to the eye different from the registered designs because there are a number of features in the registered design put together in combination which are not present in the SL series. The Ryobi has a lump-like protruberance at the rear which is quite different from the trigger-like effect of the bait feeder lever in the registered designs. The rear of the Ryobi is truncated and appears not to have a rear knob. The leg is not forked. The treatment of the body is different from the registered designs. The silhouette shape of the Ryobi is different. The leg does not widen to the same width as the body.

24. I agree with Mr Redmond's opinions.

25. In the same magazine, there appeared (at p 33) an advertisement for a Daiwa Regal Strike Rear Drag as follows:

(DESIGN OMITTED)

26. On behalf of Silstar, it is submitted that this product has a body design similar in configuration to those of the registered designs. Mr Redmond's evidence contradicted this submission.

27. I agree with Mr Redmond's opinion.

28. In the same magazine (at p 34) the following advertisement of a Rovic DX 100 appeared:

(DESIGN OF ROVIC DX 100 OMITTED)

29. Although Mr Redmond agreed that the treatment here of the back angle that runs into the mounting arm is similar to the registered designs, he pointed out that, because this is a side elevation photograph, it is not possible to say whether the design extends through in the same way as in the registered designs. In Mr Redmond's opinion, the design of this product does not have the same appeal to the eye as the registered designs. The leg does not appear to increase in width such that it becomes the same width as the body. The knob at the rear end is very pronounced and sticks out from the design. The treatment of the gearbox casing is different. Although the configuration approaches a V-shaped configuration, it is not to the same effect as the design registrations. There is no bait feeder lever. There is no trigger-like lever sticking out from the rear of the body.

30. I agree with these comments.

31. In D. Sebel and Co. Ltd. v. National Art Metal Co. Pty. Ltd., above, Jacobs J. said (at p 227):

"It is also true no doubt that a mere conjunction of old
features does not necessarily result in a new design.
However, it may do so and it seems to me that when one is
dealing with furniture design, with the obvious limitations
that exist in the addition of new features, one should not
be astute to deny novelty upon the ground that there is not
some wholly new feature of design incorporated. Design in
such a field is a subtle thing and, provided it is
distinctive to the trained eye, I think that registration
should not be denied in view of the element of subtlety
which is involved in the combination of old features in a
particular way and the manner in which they are combined.
I do not accept the submission of the defendant that novelty
and originality of design in such articles as chairs can
only exist when some quite different style or type of chair
is invented. To accept such a proposition would deny to
designers the benefit from that subtlety which represents
great skill and much thought and experience."

32. In my view, these observations are apposite in the present case. In order to succeed in its claim for rectification, Silstar must satisfy the Court that the design was not novel or original (see s.26(3) of the Act; D. Sebel and Co. Ltd. v. National Art Metal Co. Pty. Ltd., above, at p 226; Dalgety Australia Operations Ltd. v. F.F. Seeley Nominees Pty. Ltd. (1986) 10 FCR 403 at p 416). I have come to the conclusion that Silstar has not discharged the onus which lies upon it of showing that registration of the designs was bad. For the reasons given by Mr Redmond and judged by my own eye, I am not satisfied that Silstar has demonstrated that the registered designs lack the requisite novelty and originality or fall within the criterions laid down in para (a) or (b) of s.17(1) of the Act. I propose to dismiss the cross-claim.
The claim for infringement

33. In support of its claim of infringement, it is submitted on behalf of Shimano that first impressions are important; that precise mathematical comparisons are not appropriate; and that colour will not be relevant where shape and configuration are in issue. In particular, it is submitted, for Shimano, that the essential features of its designs are as follows:

"1. - overall combination of the elements identified below
2. - integration of leg with body, the bait feeder lever,
rear knob and surface treatment - organic or muscular
like visual treatment with erosion, cutting away,
rebating
3. - particular integration of leg with body including
widening at rear end view and the flow through effect
4. - particular angle at rear of leg in relation to main
axis - the V shaped configuration
5. - the bait feeder lever and its trigger like association
and its juxtaposition to the line of the rear leg -
the silhouette
6. - the particular forking of the leg and its
dominant/recessive theme and sculptural treatment
7. - the overall configuration or arrangement of design
elements referred to in 2 to 6 above and the
proportions arising out of it (for example, the
overall silhouette)."

34. It is said, on behalf of Shimano, that the Silstar product has a similar appeal to the eye by virtue of its possessing the features outlined above, and that such differences as exist do not give rise to a different appeal to the eye. Both an "obvious" and a "fraudulent" imitation are alleged. However, since there is no basis in the evidence for inferring a "fraudulent" imitation (see Turbo Tek Enterprises Inc. v. Sperling Enterprises Pty. Ltd. [1989] FCA 275; (1989) 23 FCR 331 at p 348), I turn now to the question of "obvious" imitation.

35. On behalf of Silstar, it is contended that the essential subject matter of a registered design is a particular individual and specific appearance: Wolanski's Design [1953] HCA 72; (1953) 88 CLR 278 at p 279; and if there are differences in important respects there will be no infringement: Pugh v. Riley Cycle Co. (1912) 1 Ch 613 at p 625. Silstar relies on differences which, it says, are apparent in (i) the design of the rear end; (ii) the treatment of the dominant leg/body interaction; (iii) sculpture form detailing (iv) the attachment of the bait-runner lever; (v) the prominent rear-knob and absence of cowling and sculpting in the Silstar compared to the registered designs as being significant. Silstar says that there are, in fact, substantial differences between the two designs. Silstar claims that it has produced a different design notwithstanding common features: see Firmagroup Australia Pty. Ltd. v. Byrne and Davidson Doors (Vic.) Pty. Ltd. (1987) 73 ALR 321 at p 325).

36. In my opinion, judged by the eye, the differences in design pointed to by Silstar are substantial. In order to explain why this is so, it is necessary to deal with each of them in turn as follows:
(1) Design of the rear end

37. Mr Redmond said that the blunt or flat ending of the Silstar design was more obvious than the registered designs. As a consequence, an impression is created by the registered designs of a much higher level of integration than in the case of the Silstar product. This is a marked difference. The respective knobs are themselves quite different. I agree with these comments.
(2) Treatment of leg/body interaction

38. Mr Redmond observed that in the case of the Silstar product the integration of the rear leg with the body of the gear box is a dominant feature of the design, whereas the treatment of this area in the registered design is different. In the Silstar design, but not in the registered designs, "there is nothing that breaks the flow of (the) line from the leg right up to the rear, it is a great rush from one end to the other". I agree.
(3) Sculpture form detailing

39. In his report dated May 1990, Mr Redmond mentioned as one of the differences "of detail" between the registered designs and the Silstar design -

"the sculpting of the leg's integration with the body which
generates an effect of the leg rising fully up the rear of
the body, this is an important difference."

40. I agree.
(4) Bait-runner lever

41. Mr Redmond said there were differences in the way in which the respective levers integrated with the body. I agree. Moreover, the Silstar lever is slightly curved, whereas the registered design lever consists of a straight line.
(5) Rear knob

42. As has been said, the respective rear knobs are quite different.
(6) Front portion of the reel

43. Mr Redmond maintained that the particular visual appeal of the registered designs "resided" in the treatment of the gearbox body assembly, thus excluding the forward mechanism, consisting of the head, the spool and the rotor.

44. To my eye, these differences between the respective designs are substantial, rather than slight. It follows, in my opinion, that Shimano has failed to make out a case of obvious imitation.
Result of the proceedings

45. In the result, both claims will be dismissed. In the circumstances, it is appropriate that there be no order for costs.

46. I make the following orders:

1. Application dismissed.
2. Cross-claim dismissed.