Not Entirely Functional: Canadian Federal Court of Appeal Clarifies the Scope of Protection Confered by Industrial Designs in Canada

2015-12-21

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NOTENTIRELYFUNCTIONAL:CANADIANFEDERALCOURTOFAPPEAL
CLARIFIESTHESCOPEOFPROTECTIONCONFERREDBYINDUSTRIAL
DESIGNSINCANADA

JASONMOSCOVICI*
ROBIC,
LLP
L
AWYERS,PATENT&TRADEMARKAGENTS

Inaninterestingpatentandindustrialdesigninfringementcaseinvolvingfluid
containmentproductsusedinoilfields,theCanadianFederalCourtofAppealset
asideadecisionrenderedbytheFederalCourt,whichdismissedZeroSpillSystems
(Int`l)Inc.,KATCHKANHOLDINGSLTD.,QUINNHOLTBYandKATCHKAN
RENTALSLTD’s(“ZeroSpill”)actionforinfringement,onthebasisthatthepatents
allegedwereinvalidandtheindustrialdesignbeingassertedwasnotinfringed.While
theFederalCourtofAppealreferredtheseissuesbacktotheTrialCourtforre-
evaluation,itscommentsonthescopeofprotectiongrantedbyindustrialdesign
registrations-thathappentocoverfeaturesthatarebothfunctionaland“appealingto
theeye”-clarifiesacommonmisunderstandingoftherightsconferredbysuch
registrationsinCanada.[ZeroSpillSystems(Int’l)Inc.v.Heide,2015FCA115]

Background&TrialDecision
ZeroSpillisanon-exclusivelicenseeofCanadianPatentregistrations2,136,375and
2,258,064(the“Patents”).ItisalsothelicenseeofCanadianIndustrialDesign
registration86,793(the“‘793Design”).ThePatentsandthe‘793Designcover
severalaspectsoffluidcontainmentdevices(pipetrays)soldbyZeroSpill,used
duringoilfieldoperations.
ZeroSpillsuedMr.BillHeidedbaCentralAlbertaPlasticProducts,RatPlasticLtd
and1284897ALBERTALTD(“HeideRespondents”)forsellingacompetingproduct
thatitallegesinfringesonthePatentsandonthe‘793Design
1.TheHeide
Respondentsareintheplasticfabricationandweldingbusinessandmanufacture
linepipetraysthataremodeledfromorinspiredbytheZeroSpilltray.

©CIPS,2015.*LawyerofROBIC,LLP,amultidisciplinaryfirmoflawyers,patentandtrade-markagents.Published
underthetitleCanadaCourtClarifiesLawonPatentableSubjectMatter,DosageRegimesand
TreatmentMethod(2015),29:7WorldIntellectualPropertyReport.Publication142.301.
1ZeroSpillSystems(Int’l)Inc.v.614248AlbertaLtd.(Lea-DerCoatings),2013FC616.

2
Briefly,theHeideRespondentsallegedintheirdefensethatthePatentswereinvalid
andthatthe‘793Designwasnotbeinginfringed.Theydidnotallegehoweverthat
the‘793Designwasinvalid.
Attrial,andwithregardstothe‘793Designallegationsspecifically,theTrialJudge
wasoftheopinionthattherewereinfactmanysimilaritiesbetweentheHeide
Respondent`stray,andthetraycoveredbythe‘793Design.

However,theFederalCourtrejectedZeroSpill`sclaimforindustrialdesign
infringementand,aspartofitsreasons,referredtosection5.1oftheIndustrial
DesignAct2(the“Act”),whichstates:
s.5.1NoprotectionaffordedbythisActshallextendto:
(a)featuresappliedtoausefularticlethataredictatedsolelyby
autilitarianfunctionofthearticle;or
(b)anymethodorprincipleofmanufactureorconstruction

Incomparingthe‘793DesigntotheHeideRespondent`stray,theFederalCourt
concludedthatthecommondesignfeaturesrelatedtoelementsthatwerefunctional
innature,evenifthesefeatures“appealedtotheeye”.Itfoundthatthesefeatures
werewithinthescopeofsection5.1oftheActandtherefore,excludedfrom
protection.

Furthermore,theTrialJudgewasoftheopinionthat,eventhoughtheHeide
Respondentsusedthe‘793Designasabasisonwhichtobuildtheirownproduct,
ZeroSpillfailedtoidentifyintheirpleadingswhichfeaturesofthe‘793Designwere
notexcludedbysection5.1oftheAct.

TheFederalCourtthereforeheldthatsincemanyofthefeaturesofthe‘793Design
were«functional»,andthatnoevidencewasprovidedthatwouldremovethese
featuresfromthescopeofsection5.1,thenthosefeaturescouldnotbeprotected
undertheAct.TheFederalCourtdismissedtheactionandheldthatthe‘793Design
wasnotinfringedbytheHeideRespondentsproduct.Ontheotherissuesregarding
patentinfringement,theCourtfoundthatthePatentswerealsonotinfringedfor
reasonofobviousnessand/oranticipation(notdiscussedhere).

TheAppeal

Onappeal,ZeroSpillsubmittedthat:1)inmattersinvolvingindustrialdesign
infringement,itisnotuptothepersonwhobenefitsfromindustrialdesignprotection
toprovethevalidityofitsdesign,becausesucharegistrationispresumedvalid.
ThisburdenisactuallyontheHeideRespondents,whoneededtoshowthatthe

2R.S.C.,1985,c.-I-9.

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exclusionofsection5.1appliesbecausethedesigncoversfunctionalelements,and
2)thatevenifsection5.1oftheActapplied,thissectiononlyexcludesfeatures
whoseformare«solely»dictatedbytheirfunction.

TheFederalCourtofAppealagreedandfoundthattheTrialJudgeerredinplacing
theonusonZeroSpilltoprovewhichelementsoftheindustrialdesignwere
protected,ornotexcluded,undersection5.1oftheAct.
FurtherontheissueofthepresumedvalidityofanIndustrialDesignregistrationin
Canada,theFederalCourtofAppealreferredtosection7(3)oftheAct,whichstates
that:
s7.(3)Thecertificate,intheabsenceofprooftothecontrary,is
sufficientevidenceofthedesign,oftheoriginalityofthedesign,of
thenameoftheproprietor,ofthepersonnamedasproprietorbeing
proprietor,ofthecommencementandtermofregistration,andof
compliancewiththisAct.

Section7(3)oftheActthereforecreatesa“blanketpresumptionofcompliancewith
theAct”.Assuch,itisuptothepartyalleginginvaliditytoproveotherwiseandthe
HeideRespondentsdidnotdosointhiscase.Therefore,thetrialCourterredinlaw
whenitfoundthatZeroSpillfailedtoprovideevidenceonwhichfunctionalfeatures
ofthe‘793Designwereexcludedfromsection5.1oftheAct.

TheFederalCourtofAppealalsohadissuewiththeTrialJudge`sinterpretationof
section5.1oftheActanditsfindingthat«allfeaturesofanindustrialdesignthatare
functionalareunprotectable[sic]”.Uponreadingsection5.1oftheAct,onecan
concludethatonlythefeaturesofanindustrialdesignthataredictatedsolelyby
functionareexcludedfromprotection.Therefore,functionalfeaturesthatare
«simultaneouslyusefulandvisuallyappealing»canbeprotectedundertheAct.

Initsanalysis,theCourtalsoreferredtosection64(2)oftheCopyrightAct3,where
anexemptiontocopyrightprotectionexistsfor“useful”articlesthatarereproduced
morethan50times.TheCourtinterpretedthisasimplyingthattheIndustrialDesign
Actwouldactuallyservenopurposeifitcouldnotprotectfeaturesthatwere
functional,sincethesewerespecificallyexcludedfromcopyrightprotectionin
Canada.

Therefore,byreferringtothepurposeandtheplaintextofsection5.1oftheAct,the
FederalCourtofAppealconfirmedthatfunctionalfeaturescanbenefitfrom
protectionundertheAct.Onlythedesignofelementsthataresolelydictatedby
functionareexcluded.

3R.S.C.1985,cC-42

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TheCourtremittedtheissueofinfringementofthe‘793DesignbytheHeide
respondents,aswellastheissuesregardingthePatents(notdiscussedhere),back
totheFederalCourtJudgeforredetermination.

Conclusion

ThisdecisionbytheCanadianFederalCourtofAppealclarifiesanoften
misunderstoodexceptiontothelevelofprotectiongrantedbyIndustrialDesign
registrationsinCanada:industrialdesignprotectioncanapplytodesignelements
thatarebothfunctionalandornamental.Therefore,itisnotbecauseaparticular
designincludes“afunctionalelement”thatprotectionbyIndustrialDesignis
automaticallyprecluded.Theelementmustbe“solelyfunctional”fortheexclusionto
apply.TheCourtalsoremindedusthatinlitigationinvolvingsuchmatters,the
burdenofproofisonthepartyalleginginvalidityorexclusionoftheIndustrialDesign
atissue.

Professionalsshouldthereforekeepthisdecisioninmindwhenconsultingwith
clientsonthevariousformsofintellectualpropertyprotectionavailabletothemin
Canada,oronenforcementissuesinvolvinganindustrialdesign.