Marketing and Branding
Strategies:
The Use of Trademarks and Industrial
Designs for Business Success; Case
Studies
Guriqbal Singh Jaiya
Director
SMEs Division, WIPO
Malaysian Textile Competition
The dependence on contract manufacturing means that
Malaysia is weak in terms of design and product
planning capabilities, distribution and marketing
capabilities.
Instead of creating original Malaysian brands or names,
Malaysian manufacturers produce for major world brand
names, including: Adidas, Arnold Palmer, Active Wear,
BUM Equipment, Calvin Klein, Christian Dior, Gucci,
Guess, Donna Karan, YSL, Levi's, Nike, Padini, Polo,
Ralph Lauren, Reebok, Slazenger, Pierre Cardin, Camel,
Mizuno and Montagut.
Marketing and Product
Differentiation
• DIFFERENTIATION is the act of
designing a set of meaningful
differences to distinguish the
company’s offering from competitors’
offerings.
- Kotler (1997)
Key Differentiating
Factors for a New Product
• The product represents a functional improvement on
competing or substitute products
• The retail-selling price is considered to be advantageous
• The product and/or its labeling has an attractive design
• The new product is properly branded, promoted and
advertised
• The new product is readily available to customers in the
main retail shops
• A number of after-sales services are provided that make
the product appealing to consumers
How to Prevent Free Riding?
• If functional improvements, attractive
designs and a well-positioned brand
are some of the features that may
determine the success of a new
product, what can an SME do to
protect them and maintain its
exclusivity over their use?
The Answer…
• Innovation - functional
improvement of a
product
• Design - development
of the ornamental
features of a product
• Brand - for marketing
the product
Patents or Utility
Models
Industrial Designs
Trademarks
• Patent for the fountain pen that
could store ink
• Utility Model for the grip and
pippette for injection of ink
• Industrial Design: smart design
with the grip in the shape of an
arrow
• Trademark: provided on the
product and the packaging to
distinguish it from other pens
Source: Japanese Patent Office
Corporate Image, Product
Positioning and Brand Equity
• TRUST and RELATIONSHIPS are the
bulwark of any enterprise, be it big or small,
with a global or local ambit, having a
traditional or modern management style,
high tech or low tech, leader or follower, and
irrespective of it being a part of the old world
of ‘brick and mortar’ or a rising star reliant on
e-commerce
Building Trust and Relationships
• A Brand is a consistent, holistic pledge
made by a company, the face a company
presents
•A Brand serves as an unmistakable symbol
for products and services
•“Business card” a company proffers on the
competitive scene to set itself apart from the
rest
Trust is to Business, as
Trademark is to Brand
•Brand Equity built on the foundation of a
protected Trademark
•Brand/Trademark can:
(a) be disposed off separately from other
company assets (Free-standing
Institutions); and
(b) give rights that can be legally protected
Brand/Trademark
•Trademark: Legal concept
•Brand: Marketing concept
•Registration of a trademark adds value
as it protects its other inherent assets
•Brand profile and positioning may vary
over time, but trademark protection
remains the same
WHAT IS A TRADEMARK?
• Any sign, or any combination of signs,
capable of distinguishing the goods or
services of one undertaking from those of
other undertakings, shall be capable of
constituting a trademark.
• Words including personal names, letters,
numerals, figurative elements (logos),
combination of colors, sounds, smells, etc
• Visually perceptible; 2D or 3D (shape)
• Graphic representation
Any Distinctive Words, Letters, Numerals,
Pictures, Shapes, Colors, Logotypes,
Labels
In some countries: Sounds, Smells and
Three-dimensional marks
• Examples:
Definition of a Brand
(1) Defines the differential features
of a product or service:
• Real or Imaginary
• Rational or Irrational
• Tangible or Intangible
Definition of a Brand Contd...
(2) Constitutes an image that creates a
personal experience:
• Own
• Third party
• Imaginary
Definition of a Brand Contd...
(3) With conscious and unconscious contents
that the consumer projects and deposits on it;
(4) Constitutes part of and builds up his/her
identity;
(5) Generates certain perceptions, attitudes
and behaviors and enables fulfillment in their
lives
Brand Identity
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Mind share (cognitive level)
Heart Share (Emotional relationship)
Buying intention share
Self share (self-expression and selfdesign)
• Legend Share (cultural-sociological
proposition; legendary; mythological)
Role of Brands: For the Company
In a highly competitive world, where
manufacturers are losing their
pricing power, branding is seen as a
way of clawing back some of the lost
influence.
Role of Brands: For the Company
•Real and marketable asset
•Higher profit margin (Price Premium)
•Incremental cash flow
•Reduces cash flow sustainability risk
Role of Brands: For the Company
•Accelerates speed of cash flow
•Increases bonding and customer loyalty
•Increased market share
•Entry barrier
•Limits growth of competitors
Role of Brands: For the Company
•Requires lower investment levels
•Better negotiating position with trade and
other suppliers
•Facilitates higher product availability
(better distribution coverage)
•Dealers order what customers explicitly
request
Role of Brands: For the Company
•Extends products’ life cycle
•Allows lower cost brand extensions
•Can be the basis for international expansion
•Provides legal protection; licensing;
franchising
•Buffer to survive market or product problems
Role of Brands: For the Company
•Value of Brands is a key determinant of
enterprise value and stock market
capitalization
•Financial markets reward consistently
focussed brand strategies
•Brand management a vital ingredient for
success in corporate strategy
But...
•Brand Building Requires Time and Money;
•Brand Nourishing Should be a Continuous
Process;
•Higher Profile/Exposure, Greater its
Vulnerability;
•Can be Target of Counterfeiting/Criminal
Activities;
Time required...
“It took seven years of marketing before
car buyers began to recognize that the
BMW brand was distinctive”: Jorg
Zintzmeyer, board member of Interbrand,
p 33 of FORBES Global, July 22, 2002 in
“The best-driven brand” by Nigel Hollway
So...
The cost of building a brand
can be very substantial over a
period of time. That is why
buying a brand sometimes
makes sense to many
companies.
Morgan Stanley’s Pettis Report on
the relationship of corporate brand
strategy and stock price shows
that….
•“Smart strategies can result in stock price
appreciation by 2 to 9%”
•“Positive Correlation between corporate
improvements in brand strategy programs
and a positive stock market return
•Starbucks: P/E ratio of 47!
The Importance of Brands
“Consumers are starved for time and
overwhelmed by the choices
available to them. They want strong
brands that simplify their decision
making and reduce their risks”
Are there other good reasons?
Kevin Lane Keller, Tuck School of Business
Functions of a Trademark
For the consumer:
• Enables consumers to distinguish
between similar or identical products
• Products with characteristics that may not
be examined prior to purchase
• Trademark as a guarantee of quality
Functions of Trademark
• For the company:
– Enables it to differentiate its products
– Basis for investing in the image and
reputation of a company’s products
– Consumers have emotional attachment
to certain trademarks
– Basis for a loyal clientele
The Value of a
Trademark
• Interbrand conducts an annual survey of the most
valuable trademarks in the world:
Coca-cola: US$ 68.9 billon
52.7 bill.
Microsoft : 65.1 bill.
IBM:
The Value of a Trademark
• Consumers are willing to pay a premium
price for a product bearing a trademark
with a given reputation
• Mergers and acquisitions increasingly
driven by need to acquire a trademark to,
for example, enter a new market
• Companies outsourcing manufacturing
activities to low-cost locations rely heavily
on the trademarks as the main source of
competitive advantage
Choosing a mark
• From a commercial point of view:
– Short and simple
– Easy to read, spell, pronounce and
remember in all relevant languages
– Not to have undesired connotations in
any relevant language (“Nova”,
“Traficante”, “Taco Bell”)
– Easy to adapt to all advertising media
Choosing a mark
• Cannot be registered as trademarks:
– Generic marks (cases “nylon”, “formica”,
“aspirin”, etc)
– Descriptive signs
– Signs that may lead to confusion as to the
nature of the product
– Signs contrary to public order
– Geographic signs
– Signs that are similar or identical to
existing registered trademarks
Selecting a Trademark
• Best choice:
– Arbitrary/fanciful –
• Kodak® film, Acrobat® software, Exxon® fuels
– Suggestive – gives a hint of what the product
is, but is not merely descriptive –
• Molyvan®, Vancote®
• Can not be generic or merely descriptive
– ‘Super Strong’
– Diet Chocolate Fudge Soda
– KANZEN TETSU ®
Selecting a Trademark
Arbitrary/fanciful –
• Acrobat® software, Exxon® fuels, Sprite® soft drink
Suggestive – gives a hint of what the product is, but
is not merely descriptive –
• Ty-D-Bowl® cleaner, Rollerblades® in-line skates
Descriptive with “acquired distinctiveness”
American Airlines®
• Can NOT be generic or merely descriptive
– Gummy Bears or Super Strong
Selecting a Trademark
• Must not be confusingly similar to existing
trademarks used on related goods.
– Are the marks related
• Visual appearance, sound-alike?
– Are the goods related
• Trade channels, marketing channels, compare likely
purchaser group
• Other factors – sophistication of purchasing group,
selling price, impulse vs. careful purchaser
• Likelihood of confusion – would consumers
believe that the two products come from the
same source
Types of trademarks which cannot be
registered in Malaysia
If the representations contain the following, a trade mark will not registered :
•
His Majesty the Yang Di Pertuan Agong
•
Their Royal Highnesses the Sultans
•
Their Excellencies the Yang DI Pertua Negeri
•
National Flower and Mosque
•
Royal Imperial Arms, Crests or Insignia
•
Red Crescent, Geneva Cross and other representations of the Red
Crescent, the Geneva and other crossed in red
•
Swiss Federal Cross in white or silver on a red ground or such
representations in similar colour or colours
Types of trademarks which cannot be
registered in Malaysia
•
Trade marks cannot contain the following words (in any language)
•
Red Crescent
•
Geneva Cross
•
Royal
•
Imperial
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Any wording which would amount to a false trade description or which
would cause confusion with a previously registered mark.
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Any wording which is scandalous or offensive
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Any wording which would create the impression the applicant has or
recently had Royal authorization or patronage, regardless of whether it is
true.
Types of trademarks which cannot be
registered in Malaysia
Trade marks will not be registered if they consist only of :
• Numbers, letters or full names in plain lettering
• Names of geographic locations
• Shapes of the product
• Words which describe the goods
Clearing a New Mark
• Searching –
– pending trademark applications and
granted registrations
– ‘Knock-Out’ search
• Recommend to follow up with outside
search (Thomson &Thomson®), which will
find phonetically similar marks
Clearing a New Mark
• Searching
– ‘Common law’ marks- third party rights
may also exist in non-registered marks.
Sources: Google™ search,
Lexis®/Nexis®, industry publications,
Thomson & Thomson®
Clearing a New Mark
• ‘In Use’ investigation – registered marks
may be invalid – confirm current use
through Internet or outside investigator.
• Opinion – experienced trademark counsel
can give guidance as to descriptiveness
and confusion issues
Proper Trademark Usage
• Why? – improper use can lead to loss of
exclusive rights – mark becomes generic,
and everyone can use it
• Lost - aspirin, cellophane, escalator,
thermos, linoleum
• Saved – Xerox® copiers, Band-Aid®
bandages, Rollerblade® in-line skates
Proper Trademark Usage
How?
• DO
– Use as an adjective modifying a
generic noun: Xerox® copiers
– Set apart from other text:
• Initial capital
Xerox® copiers
• All caps
XEROX® copiers
• Bold, or different font Xerox® copiers
Proper Trademark Usage
How?
• DO NOT
– Use as a noun or verb
• “Give me a xerox”
• “I am xeroxing that now”
– Use in the plural
• Incorrect - Three xeroxes
• Correct – Three Xerox copies
® – when to use
• ® indicates that a trademark is
registered in MyIPO. It must not be
used unless the mark is registered.
• It is suggested to use ® where
appropriate (gives notice to the public),
though it is not required.
TM, SM © - when
to use
™
– may be used for unregistered marks.
– Has no legal effect
SM
may be used for unregistered ‘service marks’ in
place of TM, but there is not really a legal
distinction
© relates to copyright, not trademark rights.
Loss of Rights
• Genericide
• Abandonment
– Usually 3-5 years of non-use may be grounds
for cancellation; 3 years in Malaysia
– Discontinue use with no intention to resume use
• “Naked licensing” – authorized use by a
licensee does not go to benefit of trademark
owner if not “controlled and monitored” –
can lead to abandonment
A few more important points
• TM is a territorial right
• TM must be registered (protection
through use weak and only in some
countries, including Malaysia); renewal of
registration
• It is the responsibility of the TM owner to
identify TM infringement and take action
against infringers
Registration (1)
National route: submit application form in
each country where you seek protection.
- National fees for each country
- Translation into national languages
- Convenient if protection sought in one or a limited
number of countries or no alternative
Registration (2)
Regional route: use regional trademark
systems for protection in several countries.
- African Intellectual Property Organization (OAPI):
www.oapi.wipo.net
- African Regional Industrial Property Organization
(ARIPO): www.aripo.org
- Benelux Trademark Office
- Office for the Harmonization of the Internal Market
(OHIM): trademark office for countries that are members
of the European Union. Http://oami.eu.int
Registration (3)
International route: Madrid system for the
international registration of marks
- One application
- One language
- One set of fees
- 77 member states
- Administered by WIPO
- One system, two treaties
Madrid Union
(77 Contracting Parties)
Agreement only 12
Protocol only 20
Agreement and Protocol 42
Case study: Pickwick
• An Italian businessman buys unmarked t-shirts
from manufacturers of generic clothing, attaches
his trademark and begins to sell them to retail
stores
• Started in a garage in the periphery of Rome
• Today the Pickwick trademark is perceived by
Italian teenagers as a synonym of style and quality
• Pickwick exports its products across Europe
• Its trademark is considered its most valuable
asset.
GRINGO Case Study
A Mozambiquian Success Story...
ZARA Case Study
In Industria De Diseno Textil SA v Edition Concept Sdn Bhd ([2005] 2 CLJ 357) the defendant
applied to amend the Trademarks Register to expunge the plaintiff’s ZARA mark on the
grounds that:
• the ZARA mark was wrongly entered in the register as its use was likely to deceive or cause
confusion to the public because the ZARA mark is well known in Malaysia as a result of the
defendant’s alleged use of it since September 1999; and
• there had been no use of the ZARA mark during its registration by the plaintiff for a
continuous period of three years up to one month before the application for rectification was
filed.
In dismissing the first ground, the High Court held that the correct date in determining whether
the mark was well known in Malaysia was the date of application for registration of the ZARA
mark by the plaintiff (ie, August 3 1998). The defendant failed to adduce any evidence that the
ZARA mark was well known in Malaysia on this date.
In dismissing the second ground, the High Court held that the correct date when calculating
whether there had been non-use of the ZARA mark during its registration for a continuous
period of three years was the date the mark was actually entered upon the register (ie,
February 5 2002) and not the date of application for registration. Therefore, the three-year
period should run from February 5 2002 and not August 3 1998. The High Court found that the
plaintiff had started using the ZARA mark 10 months before the rectification proceedings were
filed by the defendant; hence the defendant failed to satisfy the requirement of non-use for a
continuous period of three years.
The High Court recognised the importance of trademark searches to avoid unnecessary
litigation and their significance in commercial and business decisions. The High Court remarked
that the defendant should have carried out a trademark search at the Registry
Looking at Designs
Looking Good
Purpose of Design
– Make your product appealing to
consumers
– Create a « niche » market
– Customize products in order to target
different customers (e.g. Swatch)
– Develop the brand (e.g. Apple ’s « Think
Different » strategy)
Two-dimensional Designs
Three-Dimensional Designs
Reasons for protection
designs in the European Union
Prevent copying
Company policy
Get ahead of
competition
Prestige
Prevent people
think "I copy"
Other
0%
10%
20%
30%
40%
50%
60%
70%
80%
Protecting Industrial Designs
• New (The Malaysian definition of novelty requires
that the design has not been disclosed to the
public in Malaysia before the filing or priority date
or been the subject of an earlier filed Malaysian
design application).
• Original (Not required in Malaysia)
• Have an “ individual character”; (Not required in
Malaysia)
• In digital world: protection for displays on mobile
phones or computer icons
Protecting Industrial Designs
•
In Malaysia, the definition of a protectible design refers to
•
features of shape, configuration, pattern, or ornament applied to an
article by an industrial process or means, being features which in the
finished article appeal to and are judged by the eye, but does not include:
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(a) a method or principle of construction; or
(b) features of shape or configuration of an article which:
(i) are dictated solely by the function which the article has to perform; or
(ii) are dependent on the appearance of another article of which the
article is intended by the author of the design to form an integral part.
Designs which are contrary to public order or morality are not capable of
protection.
However, there is no requirement for any degree of creativity or
originality beyond the design being new.
Industrial Design Protection
• Industrial designs are compositions of lines or colors or any
three-dimensional forms which give a special appearance
to a product
• They protect the ornamental or aesthetic aspect of a
product
• Exclusive rights: Right to prevent others from applying
(making, selling or importing) the protected design to
commercial products for a period of 10 to 25 years; 15 yrs in
Malaysia (except in some cases)
• Requirement of registration (new EU legislation includes
unregistered design protection)
• Section 27 of the Industrial Designs Act 1996 provides for
grant of a compulsory licence if there has been no
reasonable industrial application of the registered design.
Industrial Design Protection
• The IDA of Malaysia provides a right of
action for infringement of a registered design
but no criminal offences.
• An action must be brought within a limitation
period of 5 years from the date of
infringement.
• A defence of innocent infringement is
available to an infringer who proves that he
was unaware that the design was registered.
Extending UK Designs to Malaysia
•
With the Industrial Designs Act coming into force in 1 September 1999, Malaysian industrial design
registrations are valid only for a total of only 15 years, with 2 renewal periods.
The Registrar of Industrial Designs issued a Directive stating that the 4th and 5th term extensions of
the extended UK design registrations are not applicable in Malaysia, thereby limiting the extended UK
design registrations to a maximum validity of 15 years instead of the original 25-years.
•
As a result, a legal suit (Shachihata & 18 Ors v. Registrar of Industrial Designs & Ors) was brought to
determine the above issue. The High Court of Malaya ruled that the Industrial Designs Registration
Office should by law accept applications for renewal of the fourth and fifth renewal period for UK
registered industrial designs that were registered after 01 August 1989 but before 01 September 1999.
This will mean that the period of the pre-1999 industrial design filed under the UK Registered Designs
Act 1949 will be applicable for the full 25 year period in Malaysia.
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The Registrar of Industrial Designs has therefore withdrawn the earlier Directive and has issued a New
Directive which states that 4th and 5th period extensions are now allowed (with conditions). The official
fee payable for the subsequent 4th and 5th term of the extended industrial design has not yet been
determined by the Registrar. They have indicated however that they are currently accepting renewal
documentation for the 4th and 5th period extensions, and full renewal documentation should be
provided to them first, to be followed by payment of the official fee upon announcement of the said fee.
The design needs to be new
and/or original. Do these qualify?
Registering designs abroad
• National route
• Regional route:
– Office for the Harmonization of the Internal
Market (OHIM): industrial designs office of the
European Union
• International route:
– The Hague Agreement
States party to the Hague
Agreement as of (Total 37)
Germany
Belgium
Belize
Bulgaria
Ivory Coast Croatia
Spain
Estonia
Macedonia
Gabon
Georgia
Greece
Indonesia
Iceland
Italy
Liechtenstein
Luxembourg Morocco
Mongolia
Netherlands Moldova
Holy See
Senegal
Slovenia
Suriname
Tunisia
Ukraine
Democratic People’s Republic of Korea
Serbia and Montenegro
Benin
Egypt
France
Hungary
Kyrgyzstan
Monaco
Romania
Switzerland
Case Study: TRAX
• Trax® is a system of public seating
manufactured by OMK Design Ltd.
• Originally designed for British Rail. Had to
be visually appealing, comfortable and
weather-resistant
• In 1990, installed in railway stations in UK
• 15 years later, installed in over 60 airports
• Industrial design protection in UK, France,
Germany, Italy, Benelux, Australia and the
US has guaranteed a degree of
exclusivity keeping imitators away
Honda Case Study
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In Honda Giken Kogyo Kabushiki Kaisha v Allied Pacific Motor ([2005] 3 MLJ 30) Honda applied for an interlocutory
injunction against the defendant based on the alleged infringement of:
• five industrial design registrations owned by Honda for the Honda Wave 125 motorcycle by the defendant’s Comel
Manja JMP 125 motorcycle; and
• Honda’s copyright in two and three-dimensional drawings of the Honda EX5 Dream motorcycle by the defendant’s
Comel Manja JMP 100 motorcycle.
The designs were registered on December 7, 2000. The drawings were created by Honda in Japan and first published in
Thailand.
In dismissing the defendant’s contention that the designs were not new as vehicles of a similar design had been sold in
Thailand prior to the plaintiff’s application to register the designs in Malaysia, the High Court ruled that the novelty
requirement in the Industrial Designs Act 1996 is territorial. Therefore, prior disclosure of designs outside Malaysia is
irrelevant. The court also applied the statutory presumption under Section 114(e) of the Evidence Act 1950 that official
acts have been correctly carried out. Therefore, the court held that the designs were valid, ruling that there were many
similarities between the Honda Wave 125 and the defendant’s JMP 125.
In dealing with the copyright claim, the court applied the Copyright (Application to Other Countries) Regulations 1990
and held that the drawings first published in Thailand were entitled to copyright protection in Malaysia (subject to
eligibility under the Copyright Act 1987). The court stated that the drawings were protected by copyright as artistic works
in Malaysia and were similar to the eventual product of the JMP 100 motorcycle.
Although the court concluded that there were serious questions to be tried, it stated that the balance of convenience
tilted in favour of refusal of the grant of an interlocutory injunction. The court found that the grant of an injunction
pending final disposal of the suit would have a negative and perhaps irreversible impact on the defendant, as an
injunction would affect third parties and the government.
Honda Case Study Contd...
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Interestingly, in considering the copyright claim, Section 7(6) of the Copyright Act 1987 was neither
raised nor dealt with by the court. Section 7(6) protects designs that are capable of being registered
under the Industrial Designs Act 1996 but are not registered. However, copyright for such designs
ceases as soon as any article to which the design has been applied is reproduced more than 50 times
by an industrial process.
Based on decisions of the Privy Council and the Australian courts, which are regarded as persuasive in
Malaysia, ‘capable of registration’ has been interpreted to mean that the design falls within the
definition of an ‘industrial design’ under the relevant industrial design laws, and that it does not need to
be new. However, there are no reported Malaysian cases dealing with this phrase. An ‘industrial design’
covers features of shape, configuration, pattern or ornament applied to an article by any industrial
process, being features that, in the finished article, appeal to and are judged by the eye.
Designs that are not capable of registration under the Industrial Designs Act 1996 but that are artistic
works within the meaning of the Copyright Act 1987 enjoy copyright protection for 25 years from the
time the design is exploited by the copyright owner or licensee by making articles by an industrial
process as copies of the artistic work and marketing such articles in Malaysia or elsewhere.
The two and three-dimensional drawings of the Honda EX5 Dream motorcycle were protected by
copyright as artistic works that are not capable of registration, although technically such drawings were
capable of registration under the Industrial Designs Act 1996. If the latter applied, copyright in such
drawings would cease as soon as the motorcycle (the Honda EX5) to which the design is applied had
been reproduced more than 50 times.
Concept of Novelty in Malaysia
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The recent Malaysian decision of CKE Marketing Sdn Bhd v Virtual Century Sdn Bhd [2006] 1 MLJ 767, set out that
the design concerned must be looked at as a whole, when comparisons are made with the prior art and that any
evidence of prior art has to be strictly proven.
The facts of the case
In this case, the first defendant’s industrial design which was filed on 12 August, 1999 pertained to the design of a glass
door display chiller / freezer sold under the brand name of LINDEN, termed as “Refrigeration Apparatus” under the
provision of the Industrial Designs Act 1996.
The First Defendant’s Design
The plaintiff applied for rectifying the Register of Industrial Designs contending that the Defendant’s industrial design
registration had wrongfully remained on the Designs Register due to disclosure made to the Malaysian public prior to the
said 12 August, 1999 priority date due to the existence of other designs differing only in immaterial details.
The first defendant claimed that the existing models and design features of the refrigeration apparatus that existed prior
to the date of the defendants’ design application were old and unappealing in appearance and, therefore, based on their
background knowledge of the industry, the first defendant developed novel design features and applied it to its product
and sold its new product in the market. The main features, which the first defendant contended were novel, were a
curved crescent like shape, display panel with aluminum frames and curved aluminum doorframes. The defendant’s
design registration was further bolstered by a registered design, which the defendant had obtained under the UK
Registered Design’s Act 1949.
Concept of Novelty in Malaysia
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The findings of the court
The High Court followed the requirements of novelty as set out in the English Court of Appeal decision
of AMP Incorporated v Utilux Pty Ltd [1970] RPC 397 which held that there must be substantial novelty
or originality having regard to the nature of the article before it is registrable, and differences from the
prior art in details which are immaterial are not enough reason to expunge a design registration. The
question of differences in a particular case would depend on the nature of the article, the extent of the
prior art, and the number of previous designs in the field in question.
In view of the above, the court held that the question of novelty is dependent on the nature of the
article and that a relevant consideration would be whether the article is a generic product that is
commonly used by members of the public. In such circumstances, it is likely that the design features
applied to an article are already individually in existence or in use prior to the formation of the said
article. The paramount consideration for the court will be the totality of the design features taken as a
whole and the overall appearance of the common article as compared with the articles that were
disclosed to the public earlier.
The court also held that in relation to generic and common products the standard of novelty must be
construed in accordance with the circumstances and followed the English decision of D Sebel & co Ltd
v National Art Metal Pty Ltd [1965] 10 FLR 224.
Concept of Novelty in Malaysia
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Comparison of Designs
In this case, the statement of novelty read: Novelty Resides In The Shape And Configuration Of The
Design As Shown In The Circle In The Representations” and was accompanied by front and
perspective photograph of the first defendant’s article as a whole with a side view photograph of the
curved panel marked as circle A and a front view photograph of a curved panel marked as circle B to
illustrate visual details.
In this respect, the court held that the plaintiff’s attempt to isolate each of the designs marked as circles
A and B in the design registration and compare the same individually against purported prior art was
wholly misleading and incorrect in law. This is as the appealing appearance of the first defendant’s
article was a result of a combination of a crescent like display with curved aluminum border frames and
the door frames having a distinctive curve at the center with the two grooves forming its border.
Therefore, when both the articles of the defendants as well as the plaintiff were viewed, the Judge held
that there were sufficient and material differences between both the articles in question. The first
defendant had taken reasonable amount of steps to illustrate the characteristics in the design that
would naturally enhance or have impact on the visual appearance or appeal of the first defendant’s
article.
Concept of Novelty in Malaysia
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Evidence of Prior Art
The court also held that there was no cogent evidence of the prior art as there was only a letter by a foreign company
stating that a certain model of refrigerator was introduced into the Malaysian market in 1993 which the court found to be
hearsay and it did not prove that the design concerned was disclosed to the Malaysian public at that time. As to a
collection of sales brochures and a directory, this was also not accepted by the court as evidence of disclosure to the
public. Therefore, any evidence of disclosure has to be direct and cogent such as the sale of the infringing article before
the court accepts the same.
In addition, the court held that although evidence of exports of a certain product or article can be shown in Malaysia, this
would not be sufficient or cogent evidence that the product has been disclosed to the public.
Conclusion
The stand taken by the Malaysian High Court suggests that the issue of novelty has to be viewed in great detail and not
plainly on a surface level. Accepting de minimis differences nor trade variants based on the slightest aspect of the article
as was highlighted in the above decision in question would not be sufficient to argue that a design does not hold
novelty.
The case holds firm that the issue of novelty of a design cannot just be viewed or examined on the minute details of the
article alone but must also be examined as a whole and overall features of the article itself. The court will not view the
article in isolation but rather view it as a whole. The court was therefore right to rule that the plaintiff’s attempt to isolate
each of the designs from the first defendant’s article was wholly misleading and incorrect in law.
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