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11 September 2012
The Federal Supreme Court(1) recently confirmed a decision of the Cantonal Court of Neuchatel which had approved the defendant's counterclaim and declared the nullity of the design right on which the claimants had based their infringement action.
The claimants were two affiliated companies, one producing and commercialising high-quality watches and the other acquiring and administrating the corresponding IP rights. They had filed a design application for a watch case featuring a round protuberance which interrupts the circle of the case. Three of the numerous examples are shown below.
This design was filed on January 25 2005, registered on March 8 2005 and published on March 31 2005. At the end of 2008 the claimants became aware that the defendant had launched a watch model with a watch case featuring a protuberance. They therefore instituted infringement proceedings against the defendant before the cantonal court based on the design.
The defendant not only responded that the overall impression of the watch case designs was different, but also filed a nullity counterclaim against the claimants' design. The defendant supported its counterclaim by referring to a prior design of a third party.
This watch case design had been filed on November 23 2004, registered on February 8 2005 and published on February 28 2005. The earlier priority design had not been registered when the claimants' later priority design was filed for application.
The cantonal court dismissed the claimants' infringement action, approved the defendant's counterclaim and declared the nullity of the design right on which the claimants had based their infringement action. The court essentially affirmed the nullity which the defendant had raised by way of a plea in objection based on Article 6 of the Federal Law on the Protection of Designs.
The Supreme Court confirmed this decision by reasoning as follows. Article 6 of the law stipulates that a design right belongs to the first party to file the design (which thus enjoys filing priority). Article 4 states that the protection of a design is excluded if:
"(a) no design within the meaning of Article 1 [of the law] has been filed;
(b) the design does not meet the requirements of Article 2 [of the law] at the time of filing;
(c) the features of the design are dictated solely by the technical function of the product;
(d) the design infringes federal law or international treaties; or
(e) the design is contrary to public policy or to accepted principles or morality."
Article 2, to which Article 4(b) refers, requires that a design be new and have individual character.
A design is not new if an identical design which could have been known to those active in the relevant field in Switzerland was made available to the public before the date of filing or the priority date. A design does not have individual character if its overall impression differs only in minor characteristics from a design which could have been known to those active in the relevant field.
According to the court, a design is considered to have been divulged once it is registered in the design registry. However, in the present case the claimant's design application was filed before the prior design had been registered.
The court stated that not only Article 4 but also Article 6 (which is at the same normative level) can constitute grounds for nullity. This ground of nullity is independent of Article 2 and, in the scope of the application of Article 6, the divulgence of the prior design is irrelevant. This is particularly important when a design is filed for application in Switzerland before the registration and divulgence of a prior design, but after the application. In this situation the first applicant cannot invoke Article 4(b) because the design is still considered to be new - it has not yet been registered and divulged. Therefore, the first applicant must invoke Article 6.
Furthermore, the court held that the scope of Article 6 as a ground for nullity is not limited to identical designs, but also covers similar designs.
Design infringement proceedings always carry the risk of losing the rights in a design because of a successful nullity counterclaim by the counterparty. This decision shows that also prior design applications by third parties, which had not been made available to the public when the party's own design was filed for application, must be considered in this regard.
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