25 February 2008
In Review Australia Pty Ltd v Innovative Lifestyle Investments Pty Ltd [2008] FCA 74 (15 February 2008), the Federal Court has opened up the types of damages that can be awarded for the infringement of a registered design.
Review is a fashion house with an asserted reputation for originality. Importantly, it also registers some of its designs.
Innovative Lifestyle Investments ("ILI") made copies of one of Review's dresses, so Review sued it. ILI admitted design infringement and the Federal Court had to determine the quantum of damages payable.
Normally, someone in Review's position would then seek compensation for the copying by reference to sales figures - how many dresses did ILI sell, and what effect did the competing product have on Review's own sales? Review however argued it should be compensated not for specific lost sales on that dress, but for the damage done to its reputation for originality caused by the mere offering for sale of the knock-off version.
The Federal Court agreed. If a potential dress buyer could find similar designs in other outlets, he/she might begin to think that Review's designs weren't all that novel. Without proper sales figures, however, or other evidence, the Court decided to be cautious and only awarded $7,500 for the damage to Review's reputation.
The Federal Court is also able to award additional damages "as it considers appropriate, having regard to the flagrancy of the infringement and all other relevant matters". In this case it also awarded Review additional damages of $10,000 because ILI kept copying the dress even after receiving a letter from Review's lawyers.
