Yesterday, the European General Court in Crocs v. EUIPO issued judgment cancelling a Community design registration for Crocs. In doing so, it confirmed a June 2016 Board of Appeal decision, and found that Crocs’ signature footwear design has been invalidly registered owing to prior publication. (An excellent World IP Review report on the decision is here.)
The decision is one of considerable interest in India since it follows on the heels the Delhi High Court’s February 8 decision to issue interim judgment against Crocs’ design registration in eight lawsuits for design infringement filed by Crocs between 2014 and 2018.
On the issue of prior publication, Mr Justice Mehta of the Delhi High Court had been directed by the Defendants to some web-based material put in the public domain by Canadian competitors Holeys (then called Holeys Soles). This material, which went back to the December 2002-February 2003 timeframe, appeared to demonstrate footwear designs broadly similar to Crocs’ registered design over footwear. The Defendants had also relied on material from Crocs’ own website from the October 2002-December 2002 timeframe to suggest that the substance of their design registration had been publicly revealed around this time.
This, found Mr Justice Mehta, was prima facie reliable material. More importantly, it was all prior in time to May 2003 — the ante date from which Crocs’ May 2004 design application could claim priority. The Claimants’ attempts to challenge the credibility of this material, as I had pointed out in my review of this decision last month, was given short shrift.
Even so, while the Delhi High Court decision could cast doubt on the Claimant’s case on prior publication under Section 4(b) of India’s Designs Act, it could, at best, be an interim, prima facie finding of fact. The Court’s interim ruling had, accordingly, turned predominantly on the issue of whether Crocs’ design registration was sufficiently new or original under Section 4(a) of the Designs Act.
The European General Court’s rejection of Crocs’ design registration purely on prior publication now casts serious doubt on the manner in which the Delhi inquiry was carried out.
The European Court, like the Board of Appeal before it, reviewed multiple exhibits entered into evidence by French opponents Gifi Diffusion on the issue of prior publication.
These included evidence of prior publication of Crocs’ design on its own website in November-December 2002; evidence of the clog corresponding to Crocs’ design at issue having been put on the market in July 2002; evidence that it had been exhibited in November 2002 at the Fort Lauderdale Boat Show and that the clogs to which the design at issue had been applied had been “a smashing success”; evidence from Crocs’ website showing a clog with a heel strap marked “© 2003”; evidence of publicity material from Crocs’ own websites that, “by 2003, Crocs had become a bona fide phenomenon, universally accepted”, and evidence, finally, that the clogs to which the design had been applied were available for sale before the May 2003 cutoff, at least through a distributor identified as Western Brands, and several retailers in the United States identified by name.
Set against this staggering evidence, the evidence-finding abilities of the Delhi Defendants must be called into question. (Eight sets of Defendants contested the Delhi proceedings, remember.)
However, a sharper inquiry still must be directed at the Claimants’ own conduct in ploughing on with attempts to secure injunctions in the Delhi cases despite having known, presumably, of the existence of this evidence at issue in the European proceedings.
While I recognize that it matters little to a prior publication inquiry whether the design was published one time or a hundred times, it is certainly telling that only one of these categories of evidence — the 2002 internet printouts of Crocs’ own designs— were brought to Mr Justice Mehta’s attention in the Delhi proceedings. (Nor, indeed, is there anything to indicate that he was made aware of Gifi Diffusion’s successful challenge before the European Board of Appeal, or the material pending consideration before the European General Court, while the Delhi Crocs cases were sub judice.)
In the event, the European General Court showed little hesitation in confirming that Crocs’ design had been “exhibited, used in trade or otherwise disclosed” before May 2003. It also rejected, after some deliberation, Crocs’ contention that disclosure events could not reasonably have become known in the normal course of business to the circles specialized in the sector concerned. The Court found that Crocs’ website was “technically accessible worldwide”. Even failing this, Crocs’ design could “have become known to the circles specialized in the sector concerned, operating within the European Union, by other means than through a search engine” since these circles could, in fact, “reasonably have been informed of the two disclosure events [which] occurred outside [Crocs’] website”.
Going forward, therefore, it is anyone’s guess what the fate of the Delhi Crocs actions will be — not just the eight infringement suits taken to interim judgment by Mr Justice Mehta but also at least three other actions post-2016 actions by Crocs pending before the Delhi High Court, and, of course, any appeals from Mr Justice Mehta’s February 8 decision which, on Section 4(a) grounds at least, is distinctly susceptible to challenge.
My tentative sense, though, is that, confronted with a mountain of such persuasive Section 4(b) evidence, Mr Justice Mehta’s Section 4(a) conclusions, as controversial as they may be, will likely be submerged into irrelevance. A prior publication finding on similar lines to the European General Court’s finding feels inevitable now.
The fate of Crocs’ claims feels far less certain. What should the Delhi High Court do to Claimants who bulldoze ahead with design infringement suits while keeping grave prior publication objections to their design rights under their thumb the whole time?
Mr Justice Mehta had opted to impose Rs. 200,000 plus legal costs per Defendant while entering interim judgment against Crocs; a decision that had raised eyebrows at the time. In light of yesterday’s European revelations, though, there is a convincing argument to be made that this amount is not punishment enough.
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