Forward Winsome Industries Ltd v. Playmates Industrial Co Ltd and Another
Read the full judgment text of HCA 649/1968 on BabelCite. This High Court CFI judgment was delivered on 24 June 1968.
1. The plaintiff is a company engaged in the manufacture of toys in Hong Kong. On September 21st 1967 they applied to the Designs Registry, the Patent Office, London to register eight designs of a combined wrist strap and ornament under the Registered Designs Act, 1949. Certificates of registration of these designs were granted on December 6th 1967, the protection afforded by such certificates being backdated to September 21st, the date of the application. Shortly after the granting of the certi
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HCA000649/1968 IN THE SUPREME COURT OF HONG KONG ORIGINAL JURISDICTION ACTION NO. 649 OF 1968 -----------------
Coram: Briggs J. in Chambers. Date of Judgment: 24 June 1968 ----------------- JUDGMENT ----------------- 1. The plaintiff is a company engaged in the manufacture of toys in Hong Kong. On September 21st 1967 they applied to the Designs Registry, the Patent Office, London to register eight designs of a combined wrist strap and ornament under the Registered Designs Act, 1949. Certificates of registration of these designs were granted on December 6th 1967, the protection afforded by such certificates being backdated to September 21st, the date of the application. Shortly after the granting of the certificates the plaintiffs advertised the registrations in the English and Chinese press in Hong Kong. 2. On May 9th 1968 the plaintiffs issued the writ against the first and second defendants in this action in which they claim that the defendants have infringed and are continuing to infringe their rights in respect of the registered designs. It is alleged that the first defendant is manufacturing articles which closely resemble the articles protected by the certificates of registration. And that the second defendants are selling, dealing in and exporting the said articles manufactured by the first defendants. 3. On June 6th 1968 the plaintiffs applied ex parte under Order 29, rule 1 for an injunction to restrain the first defendant from manufacturing, and the second defendant from selling or exporting [etc.] any articles in infringement of the plaintiffs registered designs. This was granted. 4. On June 19th the second defendants applied to have the injunction discharged. At the last minute the first defendants brought similar proceedings. There is no distinction so far as these present applications are concerned between the application of the first and the application of the second defendants. And in this judgment I shall not distinguish between them except where necessary. 5. The matter was fully argued before me. I ordered the injunction to remain in force until the trial. I gave this decision orally in Chambers but I added that I would give my reasons in writing on June 24th: which is today. 6. At the time of the hearing of the summons to discharge the injunction, copies of the certificates of registration were produced. These show two separate photographs of the design, which is protected, each one taken from a different angle. In addition the plaintiffs exhibited some specimens of the articles which they said were manufactured in accordance with the registered designs. Both parties exhibited specimens of the articles manufactured by the first defendants and exported by the second defendants which are alleged by the plaintiffs to infringe their registered designs. 7. The defendants bring their application under three main heads:-
The defendants add that they are willing to keep a proper account of all articles manufactured and exported by them until such action is concluded. 8. The articles with which we are concerned may be conveniently called doll watches. A wide wrist strap carries a box, the dimensions of which are some 2 1/2" by 2". This box has a transparent cover which is raised or domed. Inside this there is a small doll with a very large head in proportion to the size of its body. A prominent feature is the large quantity of hair on the head of the doll. The boxes are of various shapes but in each case the doll can be seen easily both from the top or front or from the side. In each case the cover can be removed and the doll taken out of the box. These articles are neither useful nor beautiful but it is agreed that they are the sort of toy which can easily become a fad and thus earn considerable profit for a manufacturer or exporter. 9. The first point made by counsel for the defendants was that the court is not concerned with the samples which were produced by the plaintiffs as having been made in accordance with their registered designs. What the court must consider is the registered designs themselves and the samples manufactured by the first defendants. One must be compared with the other. The designs with the samples. And the test whether there has been an infringement or not is the eye of the court. While agreeing with this in principle it must be added that it is always permissible to examine samples of what the plaintiffs say is the finished product made according to the protected design, in order to assist in arriving at a conclusion. (Dunlop v. Golf Ball etc.(1)). 10. There are eight certificates of registration. Each one states that the photograph of the design appearing on the certificate applies to "a combined wrist strap and ornament". The eight designs are basically very similar, the main difference being in the shape of the box, "the ornament" referred to in the certificate. 11. In "Copyright in Industrial Design" at page 75 of the 3rd edition the learned editor, Russell-Clarke accurately states the law thus:-
12. Counsel for the defendants pointed out various differences between the photographs on the certificates of registration and the exhibits which were admittedly manufactured by the first defendant. And this, he said, showed there was no infringement. 13. He pointed out that the articles manufactured by the defendants differed from the registered design in that (1) the former had a winder attached to the box as if it were a watch this is not part of the registered design: (2) the raised transparent top in the former does not reach down to the strap as it does in the registered design: (3) that in the former the doll lies in the box at right angles to the strap but lengthwise in the registered design. 14. He also pointed out that the straps shown in the registered design were of plain material: while those in the exhibits were not. I think that this last point is irrelevant. The colour of the material cannot be relevant. What is protected under the Act is the design. 15. The Registered Designs Act 1949 contains a definition of the expression "design". In the case of Dover v. Nuemberg Cellulord Warn Fabrik Gebruder Wolff(2) Buckly L.J. paraphrased this as follows:- [and with respect I adopt his words for the purpose of this case.] In that case at page 503 he said :
16. This does not mean that one can register an idea, for example, an idea for a new toy, simpliciter. It must be an idea as qualified in the above sense. 17. Counsel for the plaintiff urged me to adopt the test which I have stated earlier in this judgment. He said that the differences pointed out by the defendants were trivial and were not substantial. He drew my attention to the case of Harper v. Wright(3). That case was an action for infringement of a registered design for stoves. Lord Hershell suggested a very useful test to apply when seeking to determine whether there had been an infringement. He said, and I paraphrase his words, at page 489:
18. What I have to decide is whether the products made by the first defendants-are substantially the same as those illustrated on the registration certificates. And I will say at once that looking at the design as a whole and at the defendant's products I think that they are substantially the same. Adopting Lord Hershell's test, I think that if I described what is illustrated in the certificates of registration to a toy shop and that toy shop had some of the products of the first defendants-in stock, I might well be supplied with the first defendant's products, though when they are placed side by side certain differences in detail (apart from the colour and texture of the materials used) are at once apparent. But still they would be essentially the same design. 19. In my view the plaintiffs have made out a prima facie case of infringement therefore. 20. The second point taken by the defendants is that the plaintiffs cannot succeed because of their undue delay in bringing these proceedings. 21. The affidavits show that in February 1968 the plaintiffs had reason to fear that cheaper copies of their articles might be made by others in Hong Kong without their consent. I do not think that the conversation at the Nuremberg Fair reported in Miss Gardner's affidavit goes much further than that. In April 1968 the plaintiffs learned that an American firm called Cragstan was selling products which were an infringement of the registered design. And at the same time the plaintiffs knew that the first defendants manufactured a very great proportion of Cragstan's products. The writ in this action was filed on May 9th. It was amended and was not served on the defendants until June 5th. From the end of March 1968 until May 30th 1968 the plaintiffs employed Miss Woo, a private detective as a worker in the factory of the first defendants' where the articles with which we are concerned were being manufactured. The purpose of this was to secure a finished produc which was not otherwise obtainable in Hong Kong. In late May the plaintiffs managed to secure copies of shipping advices which clearly showed that the second defendants were exporting the products of the first defendants to the U.S.A. 22. An application was made for an interlocutory injunction on June 5th. The defendants' case is that this shows undue delay on the part of the plaintiffs. Their case is that the plaintiffs should have acted in mid April or at least as soon as the writ was issued on May 9th. 23. The plaintiffs are proceeding against the manufacturer and the exporter. It may well be true, I think, that they had sufficient evidence to proceed against the former before June 5th. But the affidavits clearly show that this was not so as regards the second defendants. And of course, the exporters are the more important defendants. If the first defendants had alone been restrained it would have been possible for the second defendants to have secured the manufacture of similar articles elsewhere in Hong Kong. 24. Various cases on the question of delay were referred to in the course of the hearing but I do not think it is necessary to quote from them. The rule is perfectly clear. There must not be undue delay: if there is, an injunction will not be granted of if it has been granted it may be discharged. The cases quoted were illustrations of the working of that rule. Each case of course depends very much on its own facts. In the present case though the plaintiffs have not perhaps been as quick as they could have been, I am satisfied that there has been no undue delay. Before applying to the court for an injunction of this nature it is necessary to be in provision of cogent evidence which will satisfy the court that the plaintiff has a prima facie case. In the present case such minor delay as there was was necessary to enable the plaintiffs to obtain the evidence on which to proceed. 25. In coming to my conclusion I have taken into consideration the nature of the products with which we are concerned here. This is not a case of goods being already on the shelves for the Christmas shopping season as in Bourjois Ltd. v. British Home Stores(4). However the element of time here is important. The affidavits show clearly that the toy trade is seasonal: and that products such as we have here remain the fashion, the rage, or a fad for only a limited time. It is more than probable that no one will have heard of a "Maddie Mod Go Go Watch" or a "Mod Millie Doll Watch" after a few months. 26. The final point taken by the defendants is that this is a case where the plaintiffs should be left to their remedy in damages. And the defendants have stated that they are willing to give an undertaking to the court that they will keep accurate accounts of all future transactions. Facts were placed before me which show clearly that the structure of the defendant companies, particularly the second defendant company, is such that any award of damages in favour of the plaintiff might well remain unsatisfied. If such an award were made it might well be of a considerable sum. When the injunction was granted, the plaintiffs gave the usual undertaking as to damages if their action was unsuccessful. The plaintiff company appears to be in a healthy financial state with assets in Hong Kong. This second defendant is a mere exporting company for an American principal, three of its four directors live in the U.S.A. The first defendant company was incorporated last December. Its issued capital is a mere $200,000. Behind the second defendant stands a large American commercial concern and such concerns usually pay debts which may loosely be said to have been contracted on thier behalf. However this takes us into region of speculation. 27. It was also argued on behalf of the defendants that if there has been an infringement of the plaintiffs' design the damage has already been done. Even if the injunction were to stand, the plaintiffs would not be able to sell as many of their products now as they would have been able to sell, had no such infringement taken place. Again we are in the realm of speculation. But I do not think that the affidavits show that this is so, or rather will be so. If no more of the products of the defendants are put in the market, it is only reasonable to presume that those persons who want to purchase such articles will purchase the articles manufactured by the plaintiff, although they are rather more expensive. 28. Be that as it may, upon the balance of convenience, I am of the view that this injunction should remain in force. I think it would be both unrealistic and unfair to the plaintiffs to leave then to their remedy in damages. 29. When the notice of motion came before me ex parte on June 6th I made an order for a speedy trial. Upon consideration I do not think that this was a proper rule to make at that time. For such an order should only be made after hearing all the parties to the action. Fortunately it has caused no harm. 30. The applications of the first and second defendants for the discharge of the order granting the plaintiffs an interlocutory injunction be discharged is therefore dismissed. 31. I will now hear counsel on costs and on my further directions required under Order 29 rule 7.
32. Dated 24th June, 1968. Representation: Gerald de Basto Q.C. (David Burgin & Co.) for Plaintiffs. Ronald Arculli (Johnson, Stokes & Master) for 2nd Defendants. Bernard Wong of K.B. Chau & Co. for 1st Defendants. (1) (1931) 48 R.P.C. p.277. (2) (1910) 27 R.P.C. 498. (3) (1895) 12 R.P.C. 483. (4) (1951) R.P.C. 284. |