The Supreme Court ruled on the relationship between registered design infringement and unfair competition for slavish imitation

With Sentence no. 8944 of 14 May 2020, the Italian Supreme Court stated that the owner of a registered design, when acting against infringing products, may claim both registered design infringement under the Code of intellectual Property (IP Code) and unfair competition for slavish imitation under Article 2598(1) of the Civil Code (CC).  

The Court’s ruling originates from the dispute between Menghi Shoes S.r.l. (“Menghi”) and the competitor Teddy S.p.a. (“Teddy”). Menghi had sued Teddy before the Court of Bologna alleging that the sandals marketed by the latter constituted a copy of its products, covered by Italian and European registered designs owned by it. In addition, Menghi pointed out that the defendant’s conduct constituted unfair competition in the form of slavish imitation, thus cumulating the two protections provided for by Italian law.

The Court of Bologna had initially upheld both Menghi’s claims, but the Court of Appeal of Bologna had later rejected the claim based on unfair competition, whilst confirming the infringement of the plaintiff’s designs. In fact, the Court of Appeal had found that the claim aimed at ascertaining unfair competition, as based on the same elements of the design infringement claim, could not have been granted since it was a disallowed duplication of the latter. Moreover, the Court of Appeal had found that there was no evidence that Teddy’s footwear was attributable to Menghi by the average consumer, because such footwear – bearing the trademark “Terranova” – showed their origin to be from Teddy’s company.

Menghi appealed the decision before the Supreme Court, claiming infringement and misapplication, by the Court of Appeal, of Article 2598(1) CC. In fact, according to Menghi, an act of design infringement can also be considered an unfair competition act – in particular in the form of slavish imitation – when the product’s shape is protected by a registered design and «at the same time it has an individualising capability in respect of the product, so that its imitation by the unfair competitor causes a risk of confusion».

The Supreme Court preliminarily clarified that, as confirmed by the consistent case law, Article 2598(1) CC does not forbid every kind of imitation but only imitations related to those product’s external features which have an individualising capability, «namely that are suitable to connect the product to a specific company by virtue of their distinctive capacity, provided that the reproduction of these features is not limited to those profiles required by the functional characteristics of the product itself». Having said that, the Court stated that, as a general rule, the interested party, in response to the same infringing conduct, may claim both design infringement under Article 31 IP Code and the unfair competition against slavish imitation pursuant to Article 2598(1) CC. In fact, the Court identified two protection thresholds: in the case that the product’s shape has individual character perceptible by the informed user, it enjoys design protection; on the other hand, where this shape is also perceptible as distinctive by the average consumer, «the cumulation between the protection related to the registration of the design and the measures against unfair competition in the form of  slavish imitation is permitted».

Nevertheless, in the case at issue the Supreme Court found that Menghi failed to prove that the average consumer could have wrongly associated to it the footwear marketed by Teddy. In fact, the Court of Appeal had correctly acknowledged, on the one hand, the presence of Menghi’s trademarks on the plaintiff’s product and, on the other hand, the fact that Teddy’s shoes bore the trademark “Terranova”, referable to Teddy itself. In this respect, the Supreme Court pointed out that it is undisputed that «the prohibition of slavish imitation merely protects the interest that the imitator does not create confusion with the competitor’s products, thus creating the condition for the potential buyer to misunderstand the origin of the product». This interest is fulfilled in the event that the product is presented specifically indicating that it is manufactured by a different entrepreneur and this can occur if the product itself bears a trademark suitable to attribute its origin to a specific manufacturer. It is also true that this latter condition may not always be considered sufficient to exclude slavish imitation. However, as specified by the Supreme Court, «the assessment of the fact that such a trademark does not fulfil its distinctive and qualifying function is reserved to the Court of Appeal». In the present case, the Court of Appeal had excluded the likelihood of confusion due to the distinctive signs on the parties’ footwear and therefore the related assessment, based on which the average consumer would not have had reason to associate Teddy’s product with the competitor Menghi, was not questionable by the Supreme Court.

In light of the foregoing, the Supreme Court dismissed Menghi’s appeal, stressing that in the case of a design infringement, the protection provided against design infringement may be cumulated with that provided against unfair competition for slavish imitation whenever the product has an individualising shape, perceptible by the informed user as well as the average consumer. In this case, «it will be up to the judge to ascertain whether the affixing of a trademark on the imitation product is suitable to exclude, according to the circumstances, the likelihood of confusion between the products; this assessment is unquestionable before the Supreme Court».