Intellectual Property Update December 2008

Who is the ‘informed user’?

Under the Australian Designs Act 2003 (Cth) (Act), questions of validity and infringement are considered with reference to the standard of the ‘informed user’. Correctly identifying the informed user plays a critical role in any registered designs case. In this article we look at how the standard has recently been approached by the Federal Court and the Australian Designs Office (ADO), and requires a familiarity with the product concerned that goes beyond the information possessed by the average user but falls short of an expert.

The tests for both the validity and infringement of a registered design¹ rely on whether the registered design is identical or ‘substantially similar in overall impression’ to the prior art or the alleged infringement. In determining whether a design is ‘substantially similar in overall impression’, various factors² must be considered with reference to the standard of ‘a person who is familiar with the product to which the design relates’—the standard of the informed user.

On 24 October 2008, Justice Kenny delivered judgments in two cases under the Act (Redberry³ and New Cover⁴), both of which involved the same design registration (No. 307708⁵, covering a cross-over dress) and examined the standard of the informed user.

In light of guidance from European Community design law⁶ and United Kingdom’s designs law⁷, Justice Kenny summarised in general terms the standard as follows:

• It is an objective standard.
• The assessment must be that of a user of the class of product in question.⁸
• A designer or manufacturer is not, on account of design or manufacturing knowledge alone, an informed user.
• The notional user must be informed, in the sense that the user is familiar with the product concerned.
• The informed user is not an expert, but must be more than barely informed.
• The focus for consideration is on eye appeal and not on internal or less visible manufacturing features.

The above summary marked a subtle shift in the standard, aligning it with the United Kingdom’s standard as defined in Architectural Lighting⁹, rather than the standard of the ‘ordinary’ user used by the ADO in its decision in Apple Computer Inc.¹⁰

In Architectural Lighting, Justice Fysh defined the informed user as ‘a user of articles of the sort which is subject of the registered design … a person to whom the design is directed’. Furthermore, ‘informed’ in Justice Fysh’s mind added ‘a notion of familiarity with the relevant rather more than what one might expect of the average consumer; it imports the notion of “what’s about in the market?” and “what has been about in the recent past?”’. This standard did not require ‘an archival mind (or eye) or more than an average memory’ but did demand ‘some awareness of product trend and availability and some knowledge of basic technical considerations (if any)’.

In the Apple Computer Inc case the Hearing Officer held the informed user standard is objective and stated a view that ‘an informed user is an ordinary intended user of the product made form the design, who is familiar with the product’. The design in question concerned a USB-type connector having nine electrical contacts (No. 303618)¹¹, whereas previously known USB connectors had only four electrical contacts. On the objective standard, the Hearing Officer identified the informed user as ‘a person who has general familiarity with computers, and is comfortable with purchasing and attaching USB-based peripheral devices to achieve the use they desire of their computer system’. On this definition, the informed user would have no awareness of the arrangement or number of contacts inside the USB connector as he/she was not ‘the IT expert who is familiar with all the intricacies of a computing system’.

Preferring the standard as expressed by Justice Fysh in Architectural Lighting, namely, that the requisite product familiarity is greater than the information possessed by the average user, in both Redberry and New Cover Justice Kenny doubted that, generally, the ordinary user will be appropriately regarded as an informed user.

This article was written by Huw Edwards, Senior Associate and Stuart Irvine, Patent Attorney with John Dower, Partner.

Brave new world wide web

Over the last 15 years the internet has changed our lives: providing vast amounts of information on tap, enabling rapid communication by email, facilitating online shopping, gambling and many other functions. The future of computing seems destined to be web-based. Google, Microsoft and Amazon have developed technology known as the Cloud, which outsources virtually all computing functionality to the huge server arrays of the global network.

The web relies on domain names so that humans can easily recognise and remember website addresses rather than having to rely on numeric IP addresses (which are how computers recognise each other). The domain name system is controlled by Internet Corporation for Assigned Names and Numbers (ICANN).

The top level domain is on the far right-hand side of a domain name (for example, .com, .org and .net). Over the years ICANN have slowly added to the top-level domains that are available for use on the web. At present there are 21 ‘generic’ top-level domains and 251 recognised country code top-level domains (for example, .au and .uk).  However, ICANN has now decided to release an unlimited number of top-level domains, an event that constitutes a significant change to the web.

Subject to certain restrictions, it will now be possible to obtain a top-level domain name in respect of anything. For example, companies may purchase their own top-level domain utilising their company or group name, for example .nestle. It would then be possible to use second-level domain names which correspond to that company’s brands of goods or services. Companies may decide to offer second-level domain names to distributors or other related entities. Indeed, we may even see brand names used as top-level domain names in themselves (for example, .pepsi).

Generic terms will also be available for use as top-level domains. This means that we may see the emergence of .bank or .hotel. Such top-level domains might be granted to single entities or associations of interested parties. The owner(s) of the top-level domain may then choose to allow registration of second-level domains by other parties or may keep the top-level domain for its own use.

This program is already well advanced and ICANN hopes to start accepting applications in the second quarter of 2009. The new top-level domains may go live by the end of the 2009.

The costs involved are substantial. The initial filing fee on its own is estimated to be US$185,000, with total application costs estimated to rise to approximately US$500,000. Accordingly, it remains to be seen whether the global business community will embrace ICANN’s brave new world wide web.

There are undoubted opportunities for those willing to risk the money. Clever marketing and the education of consumers could lead to the recognition of new top-level domains as designators of quality and security.  A considered application may prove very worthwhile. 

However, all Australian businesses should be aware of this program and should review the list of applications as soon as it is published by ICANN.  It is possible to object to an application on the basis of unregistered or registered trade mark rights. However, there will be a limited time period in which objections might be filed and it could prove to be a costly error if you do not object to applications that are relevant to your business.

This article was written by Tomos Shillingford, Senior Associate and Campbell Thompson, Partner.

Disaster recovery site does not infringe copyright

On 29 August 2008 Justice McKerracher of the Federal Court of Australia handed down a decision in the case of Racing & Wagering Western Australia v Software AG (Australia) Pty Ltd 2008 FCA 1332. Racing & Wagering Western Australia is the Western Australian Government’s regulator of the racing and gaming industry. For over 20 years it had engaged Software AG to provide software capable of processing a high volume of rapid transactions. Racing & Wagering Western Australia kept a copy of the object code of the software system at an offsite disaster recovery location. The copy was a ‘warm’ mirrored copy of the software, which could be activated within a matter of hours if the active software was to become non workable. The copy was stored offsite with a third party for use only in emergency situations.

Software AG alleged that this was copyright infringement and a breach of copyright, and claimed that Racing & Wagering Western Australia was required to pay double the amount of licence fees calculated from the date of the installation of the disaster recovery copy. Software AG alleged this on the basis that the contract did not specifically provide for location of a disaster recovery copy offsite. Racing & Wagering Western Australia commenced proceedings seeking a declaration as to the correct interpretation of the contract’s operation. Racing & Wagering Western Australia pleaded in the alternative that the intent and operation of the Copyright Act 1968 (Cth) allowed back-up copies to be made of software.

Justice McKerracher found that copying the software was permissible pursuant to the correct and proper interpretation of the contract between the parties. In his judgment, Justice McKerracher noted the importance of the software to the facilitation of Racing & Wagering Western Australia’s substantial business. The judge found that Racing & Wagering Western Australia’s copying of the software for the purposes of maintaining a disaster recovery copy offsite in a semi-functional capacity was not a breach of Software AG’s copyright and did not entitle Software AG to additional licence fees.

The matter is currently under appeal to the Full Federal Court.

This article was written by David Stewart, Special Counsel. David advised Racing & Wagering Western Australia on this matter prior to joining Freehills and drafted the pleading.

Claim interpretation: Nufarm Limited v Jurox Pty Limited [2008]

In Nufarm Limited v Jurox Pty Limited [2008] FCAFC 180¹², Australia's Federal Court of Appeal has approved the trial judge's novel approach to claim interpretation.

Under Australian law there is nothing new in the approach of having recourse to the body of a patent specification to interpret ambiguity in claim language. The objective is to determine from the specification the meaning of the relevant claim integer and hence the scope of the claim.

What is interesting about this case is that the objective was more to determine from the specification that which the skilled person would understand not to be the invention, and hence not within the scope of the claim. The question of infringement was then considered having regard to whether the alleged infringement resembled that which the skilled person would have understood not to be the invention.

At issue was whether the alleged infringement was an ‘emulsion’ having an ‘organic liquid phase’. Given that expert evidence had suggested alternative meanings for these integers, the trial judge turned to the specification and instead of determining in an abstract sense what constituted an ‘emulsion’ or ‘phase’, he observed that the alleged infringement resembled the product exemplified in certain examples of the patent, the exemplified product according to the specification being essentially aqueous and therefore not having an ‘organic liquid phase’.

The somewhat surprising result has been that the relevant examples were found to disclose nothing more than an explanation as to how the patentee had made the invention, rather than to exemplify the claimed product itself—even though the specification did not expressly describe the relevant examples as 'comparative'—and that the claim was effectively read down to cover specific forms of emulsions, but not emulsions of the micellar type, so that an alleged infringement that resembled a product within the relevant examples was held not to infringe the claims.

This article was written by Tom Gumley, Partner.

Endnotes

1. Under sections 15, 16 and 71 of the Act respectively
2. Set out in section 19 of the Act
3. Review 2 Pty Ltd v Redberry Enterprise Pty Ltd [2008] FCA 1588 (‘Redberry’)
4. Review Australia Pty Ltd v New Cover Group Pty Ltd [2008] FCA 1589 (‘New Cover’)
5. Dress registration
6. From where the concept of the informed user under the Act was taken
7. Where the concept of the informed user has been adopted
8. In Redberry and New Cover, this was a user of ladies’ garments
9. Woodhouse UK Plc v Architectural Lighting Systems [2006]RPC 1 (‘Architectural Lighting’)
10. Application in the name of Apple Computer Inc (2007) 74 IPR 164 (‘Apple Computer Inc’)
11. USB connector registration
12. Nufarm Limited v Jurox Pty Limited [2008] FCAFC 180

More information

For information regarding possible implications for your business, contact the Intellectual Property Partners.