Bad faith in the registration of Community designs

On 4 December, the business Court of Milan ruled in the matter of a Community design registration by an unentitled party (judgement n. 14426/2014). In particular, the Court was called to decide a dispute between two companies, the plaintiff Cubica Ltd—later named Too Late Ltd—and the defendant Squan di Pascual Luna Maria Paula & C. LP, which were the holders of two identical Community designs registered respectively in March and in January 2009 for a watch cover.

Both the plaintiff and the defendant had asked the Panel to ascertain the counterfeiting of its own design put in place by the counterpart, to condemn the counterpart to refund the damages caused by such infringement and to issue an injunction against it to prevent the prosecution of the products’ illegal commercialisation.

The Court therefore had to preliminarily determine which party was the legitimate owner of the Community design and which had obtained the registration without being entitled to. In such cases, a presumption of novelty of the first registered design normally applies. However, in the case at issue, the plaintiff (who was the second to register the design) was able to prove, through complex evidence, that the defendant was not in fact the holder of the Community design that it had registered.

Specifically, in the judgement at issue, the Judges noted that during the proceedings, serious, precise and consistent evidence in support of the plaintiff’s prospectus had emerged, according to which the first registration was obtained by the defendant in bad faith. Witnesses had confirmed, in fact, that the plaintiff’s product had been manufactured since 2008 and that the defendant had taken possession of the mould of the same (later illegally registered as Community design) during the Macef 2009 trade fair; in addition, the examination of the defendant’s design proved that it had the same four small cavities present in the mould of the plaintiff’s cover.

On the other hand, the expert witness appointed by the Court dismissed the defendant’s argument, according to which its own registered design derived from a mould that had been handmade by one of its partners; ascertained a partial correspondence between the two covers’ irregularities and in particular between the depressions/hammerings on the internal surfaces; excluded that the plaintiff’s mould could derive, as claimed by the defendant, from a cast made from the cover of the latter, as the second was larger than the first (whilst the mould must be larger than the product printed) and concluded that Cubica and Squan’s designs were made using the same mould.

Based on this, the Court considered it possible to infer with a sufficient degree of probability that the Squan cover had been made from a cast of Cubica’s cover, before being registered as a Community design in complete bad faith.

Therefore the Court ascertained the counterfeiting of Cubica’s design by the defendant, and condemned the partners of the company (which had meanwhile ceased trading) to compensate for the damage caused and to pay all legal fees incurred by the plaintiff both in the preliminary and in the main proceedings.