Can An Error In Naming An Applicant For A Design Registration Be Fatal? Foster’s Australia Limited V Cash’s (Australia) Pty Ltd

by FPA Patent Attorneys
Contact

Overview: more haste, less speed

In what circumstances should an error in naming an applicant for a design registration be fatal? In this case note, we look at Foster’s Australia Limited v Cash’s (Australia) Pty Ltd1, where the court declined to grant orders revoking design registrations on the basis of such an error.

Despite the Designs Act requirement that only the entitled person should be registered as the registered owner of a design registration, it appears the judiciary is willing to uphold the validity of a design registration in certain cases where a constructive trust can be found between the original registered owner and the entitled person.

This case provides some reassurance for entities operating in large company groups – but underscores the importance of making design applications in the name of the correct entity.

Background

Foster’s Australia Limited (FAL) was a wholly-owned subsidiary of Foster’s Group Limited (FGL), both of which were members of the Foster’s group of companies (“Foster’s Group).  During this time, FGL were able to direct the activities of FAL as FGL saw fit.

The Foster’s Group had Dot Design Pty Ltd design a new form of bar tap, pursuant to an agreement under which FAL owned the intellectual property rights created by Dot Design Pty Ltd. Under the terms of the agreement, a reference to FAL included a reference to its affiliates (which was defined so as to include FGL).

The Foster’s Group then had their patent attorneys file design applications in relation to the bar tap design created by Dot Design Pty Ltd in January 20092. Foster’s did not give explicit instructions to their patent attorneys as to which Foster’s entity should be named as applicant, and the patent attorneys nominated FGL as applicant. 

The design applications proceeded to registration in the name of FGL in July 2009. Shortly after in January 2010, the Foster’s Group noticed that FGL was the registered owner, rather than FAL. The patent attorneys were then asked to prepare and record assignments for the registered designs from FGL to FAL, which assignments were recorded in the Register of Designs in August 2010. 

FAL then brought an action against Cash’s for design infringement. Cash’s counterclaimed that the designs were invalid and should be revoked as the original registered owners (FGL) were not entitled to the design when it was first registered, and that registration of the design was obtained by false suggestion or misrepresentation.

Designs Act - The person entitled to be the registered owner

In simplified terms, there are two periods in the life of a design registration:

  • Application period - which occurs between initial filing of the design application and registration of the design; and
  • Registration period – which occurs from registration of the design until the end of life of the design. 

In accordance with s 21 and reg 3.01, a person (that is, any person) may file an application for a design.  The minimum filing requirements for a design application requires identification of the applicant – there is no requirement this needs to be the entitled person.  In the majority of cases, the applicant is taken to be the entitled person, and on registration, this person is entered onto the Register as the registered owner.

The Designs Act clearly contemplates that the applicant of the design may not necessarily be the registered owner of the design at registration, and s 29 and 30 allows amendments to the application such that registration of a design application can proceed in the name of an entitled person that is different from the original applicant.

However, what is important is that at the time the design was first registered, the person who is entered on the Register as the original registered owner is entitled to the design in accordance with s 13 and 14.  If the original registered owner was not entitled at that time, the registered design is liable to be revoked under s 93.

Constructive trust?

Cash’s argued that FGL was never entitled to be entered on the Register of Designs as the registered owner. Cash’s argued that there was no evidence that Dot Designs Pty Ltd had received written consent from FAL to assign the intellectual property rights to FGL.

On the other hand, FAL argued FGL was entitled to be recorded as registered owner of the designs because:

  1. FGL could have at the registration date required FAL to assign any design rights it had to FGL, because FGL controlled FAL; 
  2. the conduct of the Foster’s Group in relation to the filing of the design applications was enough to assign the right to apply for the designs in equity from FAL to FGL. FAL also raised an argument, but did not follow it through, that alternatively an assignment of the rights could be implied;
  3. FGL held the rights as constructive trustee for FAL. That is, equity would consider it unconscionable for FGL to deny FAL’s entitlement to the design applications and registrations, such that law would operate to require that FGL holds the rights on trust for FAL.

The court decided that FGL held the design applications and registrations as constructive trustee for FAL. This appears to have been partly:

  • on the basis that both FGL and FAL were members of the Foster’s Group, and the policy of the group clearly stated that IP of this kind was to be devoted to the Group’s interests; and
  • following precedent3, where a court finds that an application has been made other than by the true owner, and there would be no fraud on the public to do so, finding that the applicant holds the application on constructive trust for the true owner from the date of application. 

That is, at all times, the applications were made by FGL, and the design registrations granted in the name of FGL, with FGL acting on behalf of FAL (who would otherwise be entitled to apply for, and be granted, the design registrations). These findings saved the resulting design registrations from being revocable on the basis of lack of entitlement. 

On the allegation the design registrations were obtained by false suggestion or misrepresentation, the court did not find sufficient evidence that the alleged misrepresentation, of filing the designs in the name of FGL instead of FAL, was material to the Registrar registering the design registrations.  Furthermore, the court found FGL did not misrepresent its entitlement to be registered since FGL had entitlement as a constructive trustee for FAL. Therefore, the court rejected the Cash’s argument that the design registrations should be revoked on the grounds of false suggestion or misrepresentation.

Next steps

Although the design registrations were upheld by the facts and the court’s finding of a relationship that established a constructive trust, this case highlights the importance of ensuring correct entitlement of a design at the time of registration.

It is not unusual for design applications to be filed in a hasty fashion in order to ensure rights can be claimed. However, large company groups should consider establishing a default protocol with their patent attorneys to identify who should be named as applicant if instructions cannot be obtained quickly.  If there is doubt, the attorneys should be advised so that consideration can be made to amend the applicant and entitled owner of the design application before it proceeds to registration.

1. [2013] FCA 527

2. While patent applications were also filed, the issue is no longer live, following new section 22A Patents Act 1990 (Cth) (introduced as part of the Raising the Bar Act amendments), which provides that a patent is not invalid merely because the patent was granted to someone not entitled to it. This case note consequently does not cover patent aspects of the case.

3. Edwards v Liquid Engineering 2003 Pty Ltd [2008] FCA 970, Figgins Holdings Pty Ltd v Registrar of Trade Marks [1995] FCA 1455, Chang v Registrar of Titles [1976] HCA, Imagic Inc v Futuretronics (Australia) Pty Ltd (1983) 51 ALR 122,

 

DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

© FPA Patent Attorneys | Attorney Advertising

Written by:

FPA Patent Attorneys
Contact
more
less

FPA Patent Attorneys on:

Readers' Choice 2017
Reporters on Deadline

"My best business intelligence, in one easy email…"

Your first step to building a free, personalized, morning email brief covering pertinent authors and topics on JD Supra:
Sign up using*

Already signed up? Log in here

*By using the service, you signify your acceptance of JD Supra's Privacy Policy.
Privacy Policy (Updated: October 8, 2015):
hide

JD Supra provides users with access to its legal industry publishing services (the "Service") through its website (the "Website") as well as through other sources. Our policies with regard to data collection and use of personal information of users of the Service, regardless of the manner in which users access the Service, and visitors to the Website are set forth in this statement ("Policy"). By using the Service, you signify your acceptance of this Policy.

Information Collection and Use by JD Supra

JD Supra collects users' names, companies, titles, e-mail address and industry. JD Supra also tracks the pages that users visit, logs IP addresses and aggregates non-personally identifiable user data and browser type. This data is gathered using cookies and other technologies.

The information and data collected is used to authenticate users and to send notifications relating to the Service, including email alerts to which users have subscribed; to manage the Service and Website, to improve the Service and to customize the user's experience. This information is also provided to the authors of the content to give them insight into their readership and help them to improve their content, so that it is most useful for our users.

JD Supra does not sell, rent or otherwise provide your details to third parties, other than to the authors of the content on JD Supra.

If you prefer not to enable cookies, you may change your browser settings to disable cookies; however, please note that rejecting cookies while visiting the Website may result in certain parts of the Website not operating correctly or as efficiently as if cookies were allowed.

Email Choice/Opt-out

Users who opt in to receive emails may choose to no longer receive e-mail updates and newsletters by selecting the "opt-out of future email" option in the email they receive from JD Supra or in their JD Supra account management screen.

Security

JD Supra takes reasonable precautions to insure that user information is kept private. We restrict access to user information to those individuals who reasonably need access to perform their job functions, such as our third party email service, customer service personnel and technical staff. However, please note that no method of transmitting or storing data is completely secure and we cannot guarantee the security of user information. Unauthorized entry or use, hardware or software failure, and other factors may compromise the security of user information at any time.

If you have reason to believe that your interaction with us is no longer secure, you must immediately notify us of the problem by contacting us at info@jdsupra.com. In the unlikely event that we believe that the security of your user information in our possession or control may have been compromised, we may seek to notify you of that development and, if so, will endeavor to do so as promptly as practicable under the circumstances.

Sharing and Disclosure of Information JD Supra Collects

Except as otherwise described in this privacy statement, JD Supra will not disclose personal information to any third party unless we believe that disclosure is necessary to: (1) comply with applicable laws; (2) respond to governmental inquiries or requests; (3) comply with valid legal process; (4) protect the rights, privacy, safety or property of JD Supra, users of the Service, Website visitors or the public; (5) permit us to pursue available remedies or limit the damages that we may sustain; and (6) enforce our Terms & Conditions of Use.

In the event there is a change in the corporate structure of JD Supra such as, but not limited to, merger, consolidation, sale, liquidation or transfer of substantial assets, JD Supra may, in its sole discretion, transfer, sell or assign information collected on and through the Service to one or more affiliated or unaffiliated third parties.

Links to Other Websites

This Website and the Service may contain links to other websites. The operator of such other websites may collect information about you, including through cookies or other technologies. If you are using the Service through the Website and link to another site, you will leave the Website and this Policy will not apply to your use of and activity on those other sites. We encourage you to read the legal notices posted on those sites, including their privacy policies. We shall have no responsibility or liability for your visitation to, and the data collection and use practices of, such other sites. This Policy applies solely to the information collected in connection with your use of this Website and does not apply to any practices conducted offline or in connection with any other websites.

Changes in Our Privacy Policy

We reserve the right to change this Policy at any time. Please refer to the date at the top of this page to determine when this Policy was last revised. Any changes to our privacy policy will become effective upon posting of the revised policy on the Website. By continuing to use the Service or Website following such changes, you will be deemed to have agreed to such changes. If you do not agree with the terms of this Policy, as it may be amended from time to time, in whole or part, please do not continue using the Service or the Website.

Contacting JD Supra

If you have any questions about this privacy statement, the practices of this site, your dealings with this Web site, or if you would like to change any of the information you have provided to us, please contact us at: info@jdsupra.com.

- hide
*With LinkedIn, you don't need to create a separate login to manage your free JD Supra account, and we can make suggestions based on your needs and interests. We will not post anything on LinkedIn in your name. Or, sign up using your email address.