Australian Fashion Labels: Stopping the Counterfeiters

/ Madderns / News

Madderns recently hosted a successful client event at Australian Fashion Labels BNKR Flagship Store, Rundle Mall, Adelaide.

Australian Fashion Labels is the Adelaide based fashion house behind the successful brands FINDERS KEEPERS, CAMEO, KEEPSAKE, JAGGAR, THE FIFTH and TY-LR.

Guests heard from Melanie and Dean Flintoft (Founders, Australian Fashion Labels), Craig Vinall (Senior Partner, Madderns) and Lucy Deane (Senior Associate, Madderns) about how Australian Fashion Labels are building their global fashion business, whilst protecting their trade marks and designs and meeting the challenges of intellectual property enforcement.

“Great to hear and see a South Australian company outperforming internationally and also that they are partnered with a local Patent and Trade Mark Attorney to ensure this national and international success!” John Ellice-Flint, Chairman, Blue Energy Limited

“Great story from a successful Adelaide based fashion company. Interesting to hear their business model and how important it is to protect their brands, designs and prints. With monthly collections being produced they would be very busy… but worth keeping the copying at bay!” Bernadette Swart, Manager Research Office, Central Adelaide Local Health Network (CALHN)

“I decided to attend the night at the last minute. Thank goodness I did as this night was so informative and after listening to a summary of how aggressively Melanie and Dean Flintoft protect their IP and how they have implemented a proactive system to continue protection of their labels and fashion designs, I realised that we from the manufacturing sector can and have learnt from their experiences… I certainly came away from the evening with some new knowledge and strategies that also apply to our industry.” Lyall Causby, Manager – Research and Development, Antelco Pty Ltd

The Lead South Australia have also published a story arising from the event: When imitation flatters but undermines: 4 insider tips to beat counterfeit pirates

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Dr Michael Dow featured in GRDC publication

/ Madderns / News

‘In GRAINS’ Investing in Young Scientists, is a publication of the Grains Research and Development Corporation (GRDC). The publication not only illustrates the type of projects undertaken by students supported by the GRDC but also shows the skills they developed and the value they gained from their links to an industry body. It also demonstrates the breadth of scientific knowledge these students add to the grains industry via peer reviewed journal articles and conference papers.

The publication included an article featuring Dr Michael Dow, a Patent Technical Specialist with Madderns, and has been reproduced with the permission of the GRDC below. A link to the full publication is available at www.grdc.com.au/InvestingInYoungScientists.

 

Identification of key components in salinity tolerance regulation

Salinity is a major abiotic stress of crop plants worldwide. In Australia it is a significant factor impeding crop production in dryland environments. It has been estimated that up to 80% of Australia’s cereal production areas are at risk of developing problems related to salinity and the losses are estimated to be in the hundreds of millions of dollars each year. A genetic solution to salinity stress for cereals would therefore be of great economic advantage to the Australian grains industry.

By taking a genetic approach to unravelling the controls for salinity tolerance, Michael Dow has shown links between salt tolerance and other plant stress responses. His PhD was supported by a Grains Industry Research Scholarship from the GRDC.

Methods of selecting for salinity tolerance in plants

An excessive level of the salt sodium chloride is the common cause of salinity stress, which affects plants in two ways. Firstly, the salt increases the osmotic pressure of the soil water that in turn reduces the amount of water available to the plant, an effect similar to drought. Secondly, if the salt enters the plant it can gradually accumulate to toxic levels in the cells. Both of these effects compromise plant growth and development resulting in lower yield.

Salt tolerant plants are able to survive in saline soils by virtue of an array of channels and pumps that minimise sodium entry into roots. They also control the accumulation of sodium in the vacuole of the cells of both the plant’s roots and shoots.

Traditional methods of screening crops for tolerance to salinity have involved growing plants in saline environments. There has been limited success using this simple selection method as research has consistently shown salt resistance is a complex character controlled by a number of genes or groups of genes and involves a number of component traits which are likely to be quantitative in nature. New methods of developing salt tolerant plants using reverse genetic techniques are being explored and it is one such method that Michael Dow investigated during his PhD at the University of Adelaide.

A reverse genetic approach using a model plant species

Michael used the model cereal plant rice, which has had its genome completely sequenced, as a platform to investigate the molecular basis of salinity tolerance. He focused on transcription factors which are molecules involved in regulating gene expression. They are usually proteins, although they can also consist of short, non-coding RNA. Transcription factors are also usually found working in groups or complexes, forming multiple interactions that allow for varying degrees of control over rates of transcription, which is the first step in gene expression.

Michael generated transgenic rice plants with altered expression of six transcription factors. Previous research had found all six factors alter levels of transcription in salt tolerant plants but not in salt sensitive plants. Altering the expression level of each transcription factor individually allowed the effect of each transcription factor on plant salt tolerance to be assessed.

The altered expression of five of the transcription factors affected the tolerance of the plants to salinity. This was shown by changes in sodium and potassium accumulation and plant dry weight. These five transcription factors were significant similarity to other previously known stress responsive genes, suggesting their involvement in other plant stress responses. Additionally, one transcription factor that Michael identified also affected drought tolerance; these plants had a ‘stay-green’ character under drought stress.

Further experiments are underway at the University of Adelaide to determine the precise role of these transcription factors in plant responses to salt stress.

Where am I now?

Michael is currently working as a Patent Technical Specialist in the Life Sciences area with the patent and trade marks attorney firm Madderns, based in Adelaide. It is a role that he very much enjoys and it draws heavily on his technical skills, and his problem solving and critical thinking skills that he developed during his PhD.

“Research work has a level of repetition that can be tedious and frustrating, it is not for everyone,” says Michael.

“In my current job I juggle several projects at once and each day I have a sense of resolution and success. It is a very dynamic environment to work in and probably more suitable for me than a research career.”

Michael faced a number of challenges during his PhD including a number of delays in propagating plants. He took on postgraduate work in the USA while writing up his thesis and it took him five years to complete his PhD.

“Be aware of what you are taking on when you apply for a PhD,” advises Michael.

“I recommend students thoroughly understand what is involved; the University’s graduate centre is a good place to start such an investigation.”

Michael enjoyed working in a multicultural environment at the Australian Centre for Plant Functional Genomics at the University of Adelaide and also in his post doctoral role in the USA.

“This experience developed my skills in working with people with different expectations, which is very relevant in my current role.”

In his postdoctoral role at Oregon State University Michael juggled several jobs, which included laboratory based work, directing a field trial on poplar trees and as Executive Director of an Outreach Biotechnology Program which worked with high schools. This variety of projects honed his skills in multi-tasking which he continues to use in his work with Madderns.

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The relevant standard of the ‘Informed User’ for Designs in Australia after Multisteps

/ Madderns / Articles

The Australian Designs Act 2003 (Cth) requires the distinctiveness of a design and design infringement assessments to be made through the eyes of an ‘informed user’. For example, a design is distinctive unless it is substantially similar in overall impression to a design that forms part of the prior art base for the design. [1] When comparing a design to the prior art base, a Court (or relevant assessor) must apply the standard of an informed user who is a person who is familiar with the product to which the design relates, or products similar to the product to which the design relates. [2]

The concept of the informed user in Australian designs law was adopted from the Registered Designs Act 1949 (UK) and Australian courts had been relying on decisions under the UK Act and under European law to provide guidance in determining the standard of the informed user. However, the Federal Court of Australia in Multisteps Pty Limited v Source and Sell Pty Limited [3] (“Multisteps”) considered that European and UK case law offered little guidance in Australia as our legislation is framed in a different manner and the informed user is not the touchstone that is specifically provided in European legislation.

In Multisteps [4], Yates J considered the concept of the informed user in some detail and his Honour’s views on the general concept may be summarised as follows:

  • In Australia, there is no express requirement that an ‘informed user’ be an actual user of the product to which the design relates. This follows from the language of section 19(4) of the Act whereby “the standard of the informed user” is used merely as a tag after the definition of the standard.
  • Section 19(4) of the Act does not limit how and in what circumstances familiarity is acquired. Familiarity may be gained through use but the standard does not proceed on the requirement that the notional person be a user of the products in question.
  • Section 19(4) does not impose a standard higher than familiarity. A design expert is not necessarily excluded from being a person having the required familiarity.
  • The class of persons whose attributes might be taken as representing the standard of the informed user is not confined. In other words, the relevant standard may be represented in multiples classes of persons, the only necessary qualification being that the person be familiar with the product to which the design relates.
  • A suitably qualified person representative of the standard will have an awareness and appreciation of the visual features of the product that serve its functional as well as its aesthetic purposes.

His Honour drew particular attention to the Australian Law Reform Commission (ALRC) Report No. 74, Designs, in which it was recommended that:

“The concept of the informed user is flexible enough to incorporate where relevant the views of consumers, experts, specialists and skilled tradespersons. At the same time it does not, and should not, require that the expert or consumer be the test in all cases. The informed user would be defined as a person who is reasonably familiar with the nature, appearance and use of products of the relevant kind…” [5]

In Multisteps, his Honour agreed with this flexible approach in determining the requisite standard of the informed user. However, while Multisteps provides further guidance to practitioners on the relevant standard, it is a step away from other decisions of the Federal Court. For example, Kenny J in Review 2 Pty Ltd v Redberry Enterprise Pty Ltd [6], was guided by European authorities and concluded that the informed user must be a user of the class of product in question. [7] From that starting point, her Honour went on to describe the attributes or degree of familiarity that a relevant user of the product might have. Her Honour stated that:

“In the present context, women as a class are the ordinary users of ladies’ garments, but not all women have the requisite degree of familiarity to be described as informed users. Thus, whilst there will be some women who subscribe to fashion magazines (such as Vogue or Collezioni that illustrated the prior art in this case) and have particular knowledge of, and familiarity with, fashion trends, there will be many other women who lack such knowledge and familiarity. Precedent and the text of s 19(4) indicate that it is from the perspective of someone closer to the former group that the newness and distinctiveness of the Review Design and the similarity of the Redberry garments in terms of overall impression must be judged” [8]

Clearly, the approach of Kenny J is more narrowly confined than that adopted by Yates J as it limits the class of relevant persons to users of the product. Conversely, the approach of Yates J in Multisteps keeps the door open for other classes of persons such as designers, manufacturers and experts to be considered as having the degree of familiarity required be representative of the standard of the informed user.

Practically speaking, correctly framing the informed user remains a challenge for all attorneys and litigators in design infringement cases. The particular type of product in question must be carefully considered before selecting witnesses to provide evidence in support of validity and infringement arguments. At the end of the day, the court must be suitably convinced that the witness is credible and representative of a person having sufficient familiarity with the product to which the design relates. As suggested by Yates J in Multisteps, several classes of person might be suitable as witnesses so long as they are appropriately qualified and have suitable awareness and appreciation of the visual features of the product that serve its functional as well as aesthetic purposes. Whether or not the person must also be a user (as suggested by previous Australian authority in line with European guidance on the subject) is less certain after Multisteps.

 

Article by Nick McLeod and Jeff Holman

 

[1] Designs Act 2003 (Cth), s 16(2).

[2] Ibid, s 19(4).

[3] [2013] FCA 743.

[4] [2013] FCA 743, [57]-[71].

[5] Australian Law Reform Commission Report No. 74, Designs (Sydney, 1995) at [5.17].

[6] [2008] FCA 1588.

[7] Ibid, [19].

[8] Ibid, [27].

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Grants Available for Exporters

/ Michael Dow / Articles

The Australian Government offers a financial assistance program for aspiring and current exporters to cover the costs associated with export promotion activities; the Export Market Development Grants (EMDG) scheme.

The scheme has now been expanded to cover up to 50% of eligible export promotion expenses after the first $5,000 provided that the total expenses are at least $15,000. The initial payment ceiling for the grant year 2013–14 for the EMDG scheme is $60,000. Exporters with entitlements above this amount will receive a second payment at the end of June 2015. The 2013–14 grant year was open until 1 December 2014.

Protecting intellectual property rights internationally can be vital to success in overseas markets. Trade marks provide protection for the brand of a business. As many countries now operate on a first-to-file basis, where the first person to file a trade mark application obtains ownership of the mark, it can be desirable to obtain trade mark protection prior to entering an overseas market. Securing trade mark protection in these jurisdictions at an early stage is advisable to prevent competitors or trade mark “squatters” from filing their own applications for an identical or similar trade mark. Patent rights can also provide protection for products and processes, while registered designs provide protection for the physical appearance of a product. Both patents and designs can provide a crucial market advantage, and allow exporters to obtain and hold market share by preventing competitors from copying successful products.

The EMDG scheme is designed to encourage small and medium sized Australian businesses to develop export markets. Accordingly, the business’s total annual income must be $50 million or less during the last financial year. Once a business has received two grants, they may have to provide evidence of export earnings or assess indicators of future export success in order to be eligible to receive third and subsequent grants.

The EMDG scheme allows eligible business to claim a range of activities. These activities include:

  • maintaining one or more overseas representatives on a long term basis in foreign countries;
  • engaging a consultant to undertake market research, or marketing activities;
  • overseas travel expenses;
  • any expenses associated with any communication with a potential buyer or a distributor, representative or consultant;
  • providing free samples for promotional purposes;
  • participation in a trade fair, seminar, in‑store promotion, international forum, private exhibition or similar promotional event;
  • promotional literature;
  • bringing one or more buyers to Australia;
  • costs associated with the registration and insurance of intellectual property rights in foreign countries for intellectual property that was substantially developed in Australia.

Eligible intellectual property includes an intellectual property right that mainly resulted from work done in Australia, a trademark that was owned, assigned or first used in Australia, and know-how that mainly resulted from work done in Australia. Additionally, costs associated with engaging foreign attorneys to obtain trade mark and patent protection fall within the scope of the EMDG scheme. Further, insurance premiums paid for protection against possible infringement actions are also covered.

The EMDG scheme was recently amended to introduce changes in the EMDG Amendment Bill 2014 which:

  1. increase the number of grants able to be received by an applicant from seven to eight;
  2. reduce the minimum expenses threshold required to be incurred by an applicant from $20,000 to $15,000;
  3. reduce the current $5,000 deduction from the applicant’s provisional grant amount to $2,500;
  4. prevent the payment of grants to applicants engaging an EMDG consultant assessed to be a not fit and proper person; and
  5. enable a grant to be paid more quickly where a grant is determined before 1 July following the balance distribution date.

The EMDG scheme covers past expenses, so even if you have been developing export markets for some time and have been unaware of the scheme, you may be entitled to claim expenses for past years. For more information about the EMDG scheme and how to apply, visit http://www.austrade.gov.au/export/export-grants

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A Comparison of the Australian Innovation Patent and the Chinese Utility Model Patent

/ Martin Pannall / Articles

Most users of the patent systems around the world will be familiar with the “standard” patent which can last for up to 20 years and requires that the invention claimed by the patent be new and involve some level of inventiveness. Fewer users however, are aware that there are other types of patents provided for in some countries. These types of patents, often referred to as “utility model patents” can have lower thresholds as to the level of inventiveness required, and are provided to allow protection for innovations that may not meet the higher requirements of the “standard” patent and thus not be otherwise protectable.

These types of patent systems are often also associated with a more simplified registration process which can provide cost savings in some cases, as well as provide a faster means of obtaining enforceable rights.

Australia is one of the countries that provide this second tier patent, referred to as an Innovation Patent. The Innovation Patent has a very low threshold requirement for inventiveness, and can essentially provide strong protection for inventions that may otherwise not meet the higher inventiveness requirements of the Standard Patent.

China is also a country that provides a second-tier patent system, referred to as a Utility Model Patent. The Australian Innovation Patent system and the Chinese Utility Model Patent system can be utilized to benefit patent applicants in protecting inventions that may otherwise not meet the inventive requirements of the Australian Standard Patent or the Chinese equivalent – the Invention Patent or who wish to obtain enforceable rights more quickly than the corresponding Standard or Invention patents.

Although the Australian and Chinese systems can be used together, there are some important differences between the two systems of which users should be aware.

Inventiveness Requirement:

The Australian Innovation Patent generally has a markedly lower level of inventiveness requirement over the Standard Patent. The invention can be protected, provided that the claimed invention is new and that the difference between what is claimed and what is known before (the “prior art”), provides “a substantial contribution to the working of the invention”.1 In fact, in some cases, the difference between the claimed invention of the Innovation Patent and the known prior art can even be obvious, provided that the difference provides the required contribution to the working of the invention.

The wording in the Chinese Patent law defining the levels of inventiveness required for the Utility Model Patent and the Invention Patent differs slightly, and the ability to combine multiple prior art documents to challenge inventive step is more restricted for Utility Model Patents than for Invention Patents. In practice however, the inventiveness requirements of the Chinese Utility Model Patent are closer to those of the Invention Patent than the inventiveness requirements for an Australian Innovation Patent are to those of the Standard Patent.

In particular, according to the guidelines for examination, at most two pieces of prior art documents can be used to challenge inventive step of a Utility Model Patent, while there is no restriction with respect to how many prior art documents can be used to challenge an Invention Patent. In practice, there is negligible difference in the inventiveness requirements of the two Chinese patent types. The inventiveness requirements of a utility model are that the utility model has substantive features and represents progress. The inventiveness requirements of an Invention Patent are that the invention has prominent substantive features and represents notable progress.2 When challenging inventiveness of a Utility Model, only prior art documents in the same field as that of the Utility Model Patent at issue can be considered. However, as for an Invention Patent, prior art documents in the same or similar field to that of the Invention Patent can be considered.

Examination:

When an Australian Innovation Patent application is filed, it only undergoes a formalities examination and then proceeds to grant usually within 4 to 8 weeks. The granted Innovation Patent may then simply be kept in its granted state for the remainder of its 8 year term. However, if the Innovation Patent is to be enforced, then substantive examination (Certification) must be requested. The Innovation Patent is then examined for the normal patentability requirements (with the lower inventive step requirement), before being Certified.

The Chinese Utility Model Patent undergoes a preliminary examination before proceeding to grant (usually completed within 6 to 18 months). This preliminary examination is more extensive than the formalities examination of the Australian Innovation Patent, but less extensive than the substantive examination carried out on the Chinese Invention Patent. In contrast to the Australian Innovation Patent, the Chinese Utility Model Patent does not legally require any further substantive examination to be enforced before a Court. However, in practice, the patentee of a Chinese Utility Model Patent is almost always required to provide a patentability evaluation report issued from the Chinese State Intellectual Property Office (SIPO) to the Chinese People’s Court during enforcement.  This report is similar to the Certification of Australian Innovation Patent.

Concurrent Innovation/Utility Model and Standard/Invention applications

One of the more powerful aspects of the Australian Innovation Patent system is that it is very flexible, and allows the filing of multiple Innovation Patents directly and/or as divisional patent applications from a pending Standard Patent application. While strict double patenting is not permissible, multiple Innovation Patents can be directed to different aspects of the same invention, provided that the scope of the claims of each patent does not overlap. It is also possible to retain these multiple Innovation Patents when the main Standard Patent is granted.

It is also possible to convert from a Standard Patent application to an Innovation Patent (under certain circumstances) and from an Innovation Patent Application to a Standard Patent application (under much more restricted circumstances).

While it is in some cases possible to have both a Chinese Utility Model and an Invention Patent directed to the same invention in China, there are severe restrictions relating to what can be done and the timing of filings. The rules governing this aspect can be quite complex and it is advisable to seek advice from a local Chinese patent attorney in each circumstance in good time to avoid irrevocable lapsing of rights.

Patentable Subject Matter

Almost any subject matter that can be protected under an Australian Standard Patent can be protected under an Innovation Patent. The only exception to this is plants and animals, which can be protected under Standard Patents but not under Innovation Patents.

The Chinese Utility Model Patent is more restricted, in that it can only protect a physical product. Methods, processes and chemical compounds for example, cannot be protected under a Utility Model Patent and such protection would need to be sought under the Invention Patent.

The table below compares some main features of each system:

 

AUSTRALIAN INNOVATION PATENT CHINESE UTILITY MODEL PATENT
Maximum term of 8 years Maximum term of 10 years
Patentable: physical products, methods, processes, chemical compounds Patentable: physical products only
Multiple patents?– very flexible Multiple patents? – more restricted
Examination – formalities examination to grant only Examination – preliminary examination to grant only
Enforcement – must request substantive examination (Certification) after grant before enforcing Enforcement – requires a patentability evaluation report (see “Examination” above for details.
Inventiveness requirement – very low Inventiveness requirement – potentially lower, but practically the same as the Invention Patent (but see “Inventiveness Requirement” above for details)
Number of claims – 5 Number of claims – no limit
Remedies upon successful enforcement – same as for Standard Patent Remedies upon successful enforcement– same as for Invention Patent
Conversion between Innovation Patent and Standard Patent? – yes, in some circumstances Conversion between Utility Model Patent and Invention Patent? – no.
Possible to enter national phase in Australia as an Innovation Patent from a PCT application? – no (although it is possible to file a divisional application of the pending international PCT application into Australia, or to enter national phase as a Standard Patent application and then either convert the Standard Patent application into an Innovation Patent or file a divisional as an Innovation Patent). Possible to enter national phase in China as a Utility Model Patent from a PCT application?Yes.
Possible to file as a Convention application in Australia claiming priority from a Chinese priority application? Yes – within 12 months of priority date. Possible to file as a Convention application in China claiming priority from an Australian priority application? Yes – within 12 months of priority date.

 

The above highlights some of the main differences and similarities between the Australian Innovation Patent and the Chinese Utility Model Patent systems, but it should be noted that there are many other subtle features of each system. Professional advice should be sought in each case to ensure that full advantage can be taken of both systems in each circumstance and to avoid inadvertent loss of rights.

  1. Australian Patents Act 1990, ss7(4)
  2. Article 22.3 of the Chinese Patent Law
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