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4 January, 2015

The Intellectual Property Enterprise Court (IPEC) is continuing to prove itself as an effective and efficient forum for intellectual property disputes in the UK. It is particularly popular for design disputes and two recent decisions illustrate how the court can be used, and the ways in which it streamlines the process.

John Kaldor Fabricmaker UK Ltd v Lee Ann Fashions Ltd [2014] EWHC 3779 (IPEC) concerned whether a designer had produced a fabric design independently, or by copying. Lee Ann Fashions Ltd received a design brief and requested samples of material from John Kaldor Fabricmaker UK Ltd for use in this brief. Lee Ann, after making a sample dress with the John Kaldor fabric, decided instead to get one of their in house designers to design their own fabric for the dress. John Kaldor alleged infringement of copyright and Community unregistered design right, arguing that their fabric had been copied, either consciously, subconsciously or indirectly. The parties agreed that whether said copying took place was the key issue, and as such witnesses and evidence submission was limited accordingly.

The judge considered the similarities of the two fabric designs and the design corpus, and found that there was a “prima facie possibility that there was copying, but the possibility is neither strong nor negligible”. However, faced with the designer’s evidence of the design process and earlier concepts, and having no reason to question the designer’s assertion that she could not remember the John Kaldor material, the judge ruled that no copying had taken place.

The case highlights the importance of designers keeping a thorough record of their ideas and that the designer’s evidence is key in situations where copying is not clear cut. Nevertheless, evidence from a large number of witnesses is both unnecessary and discouraged in order to maintain the streamlined nature of IPEC proceedings.

The IPEC also ruled on damages relating to a case which had previously been heard by the court in UWUG Ltd & Anor v Ball (t/a Red) [2014] EWHC 4019 (IPEC) in which there had been a finding of unregistered design right infringement. The case related to a product which UWUG commissioned Mr Ball to design. Following poor sales and monetary issues, Mr Ball suggested that he should be allowed to sell the product himself. UWUG instead suggested that Mr Ball should act as an agent of UWUG, selling other items in their range and receiving a 10% commission on sales of the product in question. Mr Ball did not respond to this offer. A formal contract on these terms was drawn up by UWUG, but never sent to Mr Ball. Mr Ball then proceeded to sell the product independently, and hence was found to have infringed the design rights.

An assessment of damages can be a very complex and expensive process. In this case, damages were claimed under a number of different heads, including loss of profit from sales of the product in question and sales of other convoyed goods which would have accompanied sales of the product, and damages. However, the court took a pragmatic approach, cutting through much of the usual argument and detail. Instead, the judge accepted that if a 10% royalty was previously thought to be a fair offer, then it represents a fair level of damages and therefore he awarded this figure.

These cases illustrate the practical and cost-effective approach adopted by the Intellectual Property Enterprise Court. It is likely to continue to be a popular forum, especially for parties with shallower pockets.