Scintilla – a flash, a spark, an iota. Shorthand for creativity and an indicator of inventiveness under Australian law.






Tuesday, July 23, 2013

Coffee cup court case hits corrugations

By Senior Associate Lester Miller

Access to justice has been a deciding factor for a Federal Court judge in making an order for the Registrar of Designs to complete a second examination of a registered design, rather than have the issues proceed in court. Surprisingly, the argument for the change of venue was made by the sole director of a company, representing himself and the company, both of whom had been alleged to have infringed the design.


Background


In the middle of 2012, Enviro Pak alleged that New Horticulture (trading as Green Pack) was infringing its registered design for a corrugated coffee cup and commenced Federal Court proceedings on 9 August 2012.

The day before, unbeknownst to Enviro Pak, Green Pack filed an application to revoke the design on the basis that Enviro Pak was not entitled to be the registered owner of the design. Under s51 of the Designs Act 2003, the Registrar of Designs cannot revoke a design on the basis of ownership while court proceedings are on foot, but the Registrar is able to investigate an ownership allegation.

Green Pack signed undertakings on 22 August 2012 that it would not commercially exploit the design, the court case continued, and Green Pack started incurring further legal costs and court charges.

On 6 December 2012, Green Pack alleged the design lacked distinctiveness and requested that the Registrar conduct another examination of the design. The Designs Act 2003 also does not allow the Registrar to examine a design when there are court proceedings on foot for the design, but can proceed if the court orders it to do so.

Vexing times


In 2013, after evidence had been led, Green Pack's legal costs had placed a great deal of financial stress on the company. Green Pack asked the court for permission to be represented by its sole director and co-respondent, Mr Koesterke. Permission was granted, even though the matters raised would be complex, and experts and cross-examinations may be required. The reasons given by Justice Griffiths were the degree of financial hardship of Green Pack, the advanced stage of the case, the demonstrated clarity of Mr Koesterke's arguments and the fact that Mr Koesterke was already a respondent to the case and had therefore been given an opportunity by Enviro Pak to represent himself in court.

Justice at a reduced price


Mr Koesterke then asked for a stay of proceedings and for the matter to be transferred to IP Australia for consideration by the Registrar.

Justice Griffiths acknowledged the right of a plaintiff to be heard in court, but noted that the court can make orders, for example, to direct proceedings be referred to arbitration or alternative dispute resolution. His Honour also considered the differences in procedures between IP Australia and the court.

Ultimately, in view of the reduced costs of IP Australia's processes, the financial difficulty of Green Pack, the related nature of the ownership and distinctiveness disputes, the fact that Registrar considered that Green Pack's ownership case was 'plausible', the likely certainty of IP Australia's proceedings, and the availability of an appeal to a court of the ownership disputes, Justice Griffiths considered that justice would be best served by allowing the Registrar to examine the design.

We will be back in touch with the results of Registrar's deliberations.

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