Designs - Original Beauty Technology v G4K Fashion

        

 












Jane Lambert

Chancery Division (Mr David Stone) Original Beauty Technology and others v G4K Fashion Ltd and others [2021] EWHC 294 (Ch) (24 Feb 2021)

This was an action for infringement of unregistered design right and unregistered Community designs and passing off.  The designs in question were of women's garments in the bodycon and bandage styles. The action came on for trial before Mr David Stone on various dates between 30 Nov and 21 Dec 2020. In Original Beauty Technology and others v G4K Fashion Ltd and others [2021] EWHC 294 (Ch) which he handed down on 24 Feb 2021 he found that the defendants had infringed some of the first claimant's unregistered design rights and unregistered Community designs but they had not passed off their business as or for the claimants', Following his judgment, there were further hearings on the terms of the minute of order, whether garments in different colourways infringed the first claimant's unregistered community designs and whether a Part 36 offer affected the claimants' entitlement to costs.

The Parties

The claimants were Original Beauty Technology Company Ltd. ("Original Beauty"), Linhope International Ltd. ("Linhope") and Retail Inc Ltd. ("Retail").  Original Beauty and Linhope are incorporated in Hong Kong.  Retail, which is no longer doing business, was an English company with stores in London, Manchester and Sheffield.  Linhope owns various trade marks which it licenses to Original Beauty.  Original beauty distributes its products through the www.houseofcb.com and www.mistressrocks.com websites and also through franchise agreements with various retailers including Retail while it was trading.

G4K Fashion Ltd. ("G4K") was the first defendant.  It distributed bodycon and bandage garments under the "Oh Polly"  brand between 2015 and 2017. It sold that business to  Oh Polly Ltd. ("Oh Polly"), the fourth defendant, in 2017. Oh Polly is a Scottish company whose directors and shareholders are Claire Henderson ("Ms Henderson") the second defendant and Michael Branney ("Dr Branney"), the third,  G4K now has a share of a warehouse which it lets out to Oh Polly in return for rent.

Unregistered Design Right

The first claimant alleged that employees of its design agency, Sirens Designs Ltd, ("Sirens") had designed 91 garments in the course of their employment.  They further alleged that design rights subsisted in those designs and that Sirens was the first owner of those design rights pursuant to s.215 (3) of the Copyright, Designs and Patents Act 1988.  They said that Sirens had assigned those design rights to Original Beauty which made or arranged for clothes to be made to those designs and placed on the market.  The claimants claimed that the defendants had infringed their design rights by making, marketing and selling garments that reproduced their designs.

The defendants challenged the subsistence of design right in the designs.  They did not dispute the evidence of Sirens's employee, Georgina Douek, that she had designed 5 of the garments in the course of her employment but they did not accept that the others had been created by Sirens's employees. They contested the originality of the claimants' designs and denied that they had copied them.

Unregistered Community Designs

The first claimant contended that unregistered Community designs subsisted in each of its designs in that it was new and had individual character and that the defendants had infringed those designs by making garments that did not produce on the informed user a different overall impression as a result of copying.   As with unregistered design right, the defendants denied subsistence and infringement.

Passing off

The claimants alleged that the defendants had misrepresented to the public that Oh Polly was a sister to their brands by copying many aspects of their business and that that misrepresentation had caused and was causing damage.  They claimed goodwill in their business and marketing style and get-up which they defined as:

“…the concepts, style and get-up of its business, fashion, collections, garment design, packaging, marketing, publicity, website and social media, including the design and high quality of its collections and garments, the highly distinctive style of its packaging, marketing and websites, including the design and layout, look and feel, concept, style, presentation and content of its website, the use of social media and the customer experience and customer service on its website and stores…”:

They alleged that the Oh Polly website misrepresented a connection with the claimant's business:

“The Defendants have adopted the same or strikingly similar concepts, style and get-up for their business, fashion, collections, garment designs, packaging, marketing, publicity, website design and social media as [House of CB]. The advertisement, offer for sale and sale by the Defendants of “look-alike” fashion, collections, garments and accessories, in “look-alike” packaging on a “look-alike” website and the wholesale copying and/or imitation of [House of CB’s] Business and Marketing Style and Get-Up constitutes a misrepresentation by the Defendants…”

The defendants disputed both goodwill and misrepresentation.

Procedure

At a case management conference, Deputy Master Nurse ordered each of the parties to select 10 garment designs to be considered at trial and stayed the proceedings in respect of the other 71. The claimants applied unsuccessfully to vary the order to require the court to consider only their selection.   At trial, Mr Stone considered whether design right and unregistered Community design subsisted in the 20 designs that the parties had chosen.

Title

The learned deputy judge dismissed the defendants' argument that the claimants had not proved title to the design rights and unregistered Community designs in the designs that had not been designed by Ms Doiek at [103].  He said that it was not incumbent on an unregistered design right claimant to provide testimony from the designer of each design, so long as it has evidence of who created the relevant design.  He said that the same applied to unregistered Community designs at [135].

The Designs

Between paragraphs [137] and [388] Mr Stone determined whether design right and/or an unregistered Community design subsisted in each of the 20 selected designs and, where he decided that it did, whether such design right or unregistered Community design had been infringed.  He decided subsistence by comparing the first claimant's design with an antecedent design or designs upon which the defendants had relied.  He considered infringement by comparing the defendants' garment with the claimant's.

For example, the claimants alleged that design right and an unregistered Community design subsisted in the following dress which is referred to in the judgment as "C2".

 


















They complained that defendants had infringed the design right and unregistered Community design by making, marketing and selling the dress referred to as "D2".























The defendants denied copying and challenged the subsistence of design right and unregistered Community design by reference to the following dress which had been featured in the MailOnline before C2 appeared.































The deputy judge reviewed the images and held that C2 was not slavishly copied from the dress upon which the defendants relied,  He also considered other dresses upon which they relied for their contention that the design of C2 was commonplace. He concluded that C2 did not produce the same overall impression on the informed user. It followed that design right and an unregistered Community design subsisted in C2.

Having criticized Ms Henderson as a witness at [55] he rejected her evidence that she based D2 on the dress that had appeared in the MailOnline.  Her evidence was contradicted by an email that she sent to Dr Branney. That email attached images of C2 and not the dress in the MailOnline. Mr Stone had no hesitation in finding that D2 was copied from C2 and that it infringed the first claimant's design right and unregistered Community design.

The learned deputy judge carried out a similar exercise with the other selected designs.   He found at para [390] that none of the claimants’ 20 designs was slavishly copied from the third party designs which were before him.  He held at [511] that in creating designs D2, D4, D12, D13, D35, D61 and D91, Ms Henderson had copied the claimants’ designs C2, C4, C12, C13, C35, C61 and C91, Designs D2, D4, D12, D13, D35, D61 and D91 were made exactly or substantially to the designs of C2, C4, C12, C13, C35, C61 and C91 and therefore infringed the claimants’ design rights.  Designs D2, D4 (in cream), D12, D13, D35, D61 (in brown but not in white), D91 (in black but not in other colourways) produced on the informed user the same overall impression as C2, C4, C12, C13, C35, C61 and C91 and therefore infringed the claimants’ unregistered Community designs


Determining Passing off

Mr Stone took as his starting point Lord Oliver's speech in Reckitt and Colman Products Ltd v Borden Inc and others  [1990] WLR 491, [1990] UKHL 12, [1990] 1 All ER 873, [1990] RPC 341, [1990] 1 WLR 491:

“The law of passing off can be summarised in one short general proposition - no man may pass off his goods as those of another. More specifically, it may be expressed in terms of the elements which the plaintiff in such an action has to prove in order to succeed. These are three in number. First he must establish a goodwill or reputation attached to the goods or services which he supplies in the mind of the purchasing public by association with the identifying ‘get-up’ (whether it consists simply of a brand name or trade description, or the individual features of labelling or packaging) under which his particular goods or services are offered to the public, such that the get-up is recognised by the public as distinctive specifically of the plaintiff's goods or services. Secondly, he must demonstrate a misrepresentation by the defendant to the public (whether or not intentional) leading or likely to lead the public to believe that goods or services offered by him are the goods or services of the plaintiff. Whether the public is aware of the plaintiff's identity as the manufacturer or supplier of the goods or services is immaterial, as long as they are identified with a particular source which is in fact the plaintiff. Thirdly he must demonstrate that he suffers, or in a quia timet action that he is likely to suffer, damage by reason of the erroneous belief engendered by the defendant's misrepresentation that the source of the defendant’s goods or services is the same as the source of those offered by the plaintiff.”

After considering the evidence, the deputy judge held at [500] that the claimants had proved their case in relation to goodwill in some of the indicia as set out above, but not that sufficient members of the relevant public have been deceived.  Even though the first element had been made out the second had not.  The passing off claim therefore failed.

Additional Damages

Mr Stone acceded to the claimant's request for a finding that they were entitled to additional damages for the design right infringements under s.229 (3) of the 1988 Act and art 89 (1) (d) of the Community Design Regulation for the unregistered Community design infringements for the following reasons:

"I have found that the Defendants have infringed the Claimants’ UKUDR and CUDR in relation to 7 garments. Whilst Ms Henderson, the named designer of the relevant garments, has denied copying, I have held her not to be an honest witness, and I have discounted her evidence unless it is corroborated by other evidence. What is clear from the written record is that for the Defendants’ garments D2, D4, D12, D13, D35, D61 and D91, Ms Henderson took an image of the Claimants’ garments, and sent it to the factory to be reproduced. In the circumstances of this case, that is sufficient to warrant an award of additional damages in relation to those designs. It was at least an attitude of “couldn’t care less” about the rights of others: a designer, as Ms Henderson claimed to be, of her years of experience, ought to have known (if she did not in fact know) that such activity was not lawful."

The Terms of the Minute of Order

While negotiating the terms of the minute of order the defendants requested the following declaration:

"The Defendants have not infringed the UKUDR or UCD subsisting in each of the designs referred to in the Court's judgment as C3, C7, C9, C17, C21, C47, C49, C63, C66, C77, C81, C93 and C102".

The claimants refused that request and the action came back before Mr Stone on 1 April 2021.  The defendants argued that the requested declaration would serve two useful purposes.  First, it would give a complete picture as to what had been decided. Secondly, it would dispel any misleading impression that that issue had not been decided.

The deputy judge refused the defendants' request in Original Beauty Technology Company Ltd and others v G4k Fashion Ltd and others [2021] EWHC 836 (Ch) (1 April 2021).  Para 9 of the draft that had been agreed so far provided as follows:

"Save as aforesaid, each of the Claimants' claims of infringement of UKUDR and UCD in respect of the Selected Garments is dismissed."

That seemed to meet both of the defendants' points.   Also, the proposed declaration with its references to the "C" numbers could not be understood without reference to the judgment.  

The Remaining Designs

At para [513] of his judgment of 24 Feb 2021, Mr Stone expressed the fervent hope that his judgment would facilitate the resolution of the dispute in relation to the 71 designs in respect of which Deputy Master Nurse had stayed proceedings. He noted that the 20 garments in issue before him fell into three “buckets”:
  • Those in which Ms Henderson admitted that she had referred to the claimants' designs at the start of the design process;
  • Those where she admitted that she had referred to the claimants' designs in the course of that process; and
  • Those where she had not admitted that she had referred to the claimants' designs.
He had found that, on the whole, the garments in the first bucket infringed, but that those in the other two did not.  He added that his judgment ought to provide good guidance for dealing with the remaining 71 designs without the need for a further trial on liability in relation to those designs which was likely to be disproportionate

One of the differences between unregistered design right and unregistered Community designs is that the colour of an article is irrelevant to the question as to whether an article reproduces exactly or substantially a design but not to the question of whether it produces on the informed user a different overall impression.  In his judgment of 24 Feb, 2021 Mr Stone had said that certain garments of a particular shape but in a different colourway infringe design right but not an unregistered Community design. The defendants pointed out that some of their garments were of a different colour to the claimants' and they requested a ruling as to whether garments in those colourways would infringe.

The claimants resisted the defendants' request on the ground that it would make no difference to their remedies whether an article infringed unregistered design right, an unregistered design or both.  The deputy judge agreed so far as the first 20 designs were concerned but thought it could be useful for resolving the dispute over the remaining 71.   In Original Beauty Technology Company Ltd and another v G4k Fashion Ltd and others [2021] EWHC 953 (Ch) (28 April 2021) Mr Stone considered whether dress design D2 in sage shown below would infringe the first claimant's unregistered design.


The learned deputy judge held it would not because the sage colour would strike the informed user such that D2 would produce on the informed user a different overall impression to C2 in wine. He reached similar conclusions in respect of several other designs.

Costs

Having won on liability including an award of additional damages the first and second claimants sought their costs.  The only problem was that the defendants had made a Part 36 offer to settle the action including payment of damages.   In Original Beauty Technology Company Ltd and another v G4k Fashion Ltd and others [2021] EWHC 954 (Ch) (28 April 2021) Mr Stone refused to award costs in favour of the claimants at this stage on the ground that he was bound by the clear words of CPR 36.17 and para [28] of the decision of Judge Pelling in Lifestyle Equities CV and another v Sportsdirect.Com Retail Ltd and others  [2018] EWHC 962 (Ch) (20 April 2018):

"In any event, it seems to me that to embark upon a methodology which involves imposing an order for costs for part of the trial of liability, then addressing the issues of costs that arise after the date of a Part 36 offer, so far as liability is concerned, and then also to attempt to deal with costs in relation to any quantum inquiries is a recipe for complexity, prolixity and avoidable expense, both in terms of costs for the parties and resources so far as the court is concerned. Where there has been a Part 36 offer made and the parties have either been ordered to or agreed to split the trial between liability and quantum, the appropriate course is to wait until after the quantum issues have been resolved before attempting to address questions of costs."

The deputy judge added at [24] that if he were not bound to reserve the question of costs to the judge taking the inquiry he would have a discretion which he would not have exercised in this case as the court did not have the information it required to make a fair determination,

Further Information

Anyone wishing to discuss this case or any of its issues may call me on 020 7404 5252 or send me message through my contact form. 

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