Advocate general speaks out on Community design ownership

Advocate General Paolo Mengozzi has released his opinion in Fundación Española para la Innovación de la Artesanía v Cul de Sac Espacio Creativo SL (Case C-32/08, March 26 2009), a reference for a preliminary ruling from the Spanish Community Design Court (the Alicante First Commercial Court). The reference was made in the context of an unregistered Community design infringement action brought by Fundación Española para la Innovación de la Artesanía (FEIA) against Cul de Sac Espacio Creativo SL and Acierta Product & Position SA.

 

As part of a project to produce and sell handmade objects based on designs by professional industrial designers, FEIA commissioned Acierta to choose and hire designers to develop such designs. Acierta hired Cul de Sac, which designed a series of cuckoo clocks to form the Santamaría collection.

 

Cul de Sac and Acierta later sold cuckoo clocks under the name 'Timeless'. FEIA considered that the sale of the Timeless cuckoo clocks infringed its unregistered Community design rights over the designs of the clocks in the Santamaría collection, and sued Acierta and Cul de Sac before the Alicante First Commercial Court.

 

The defendants argued that FEIA had no standing to sue since it was not the holder of the rights in the unregistered Community designs at issue.

 

The Alicante court queried the interpretation of Article 14(3) of the EU Community Design Regulation (6/2002), which regulates the Community design ownership regime. Article 14(3) provides that the rights in a design developed by an employee in the execution of his or her duties or when following the employer's instructions vest in the employer, unless otherwise agreed or specified under national law. Therefore, the Alicante court asked the European Court of Justice (ECJ) whether Article 14(3) should be interpreted as referring only to Community designs developed in the context of a strict employment relationship (ie, where the designer is bound by an employment contract and works under the direction and in the employ of another), or whether it should be interpreted broadly so as to include situations other than employment relationships (ie, where, in accordance with a civil or commercial contract, a designer undertakes to execute a design for another individual for an agreed price).

 

In the advocate general's opinion, the wording of Article 14(3), including terms such as 'employer' and 'employee', illustrates the intention of the legislature to apply this rule of ownership exclusively to situations where there is a subordination link in the sense of an employment relationship. Therefore, to apply the article to work relationships based on civil or commercial contracts would be contrary to the wording of the regulation. In addition, he stated that the reference made by Article 14(3) to designs developed following the instructions of the employer should not be interpreted as the intention of the legislature to extend the rule to designs developed within the framework of a civil or commercial contract.

 

The advocate general also concluded that legal reasoning by analogy, according to which Article 14(3) is applicable to designs developed as part of a commission, could not be affirmed. In support of such a statement he invoked the ratio of the article, referring to the “totalizing” character of employment relationships which justifies the transfer of the rights in the design to the employer, and the Community Design Regulation preparatory works.

 

The Alicante court went on to ask the ECJ whether, in the event that Article 14(3) was not applicable to designs developed within the framework of a civil or commercial contract, the ownership of these designs should be determined pursuant to Article 14(1) of the regulation - which provides that the right belongs to the designer or his or her successor in title - or whether there is a legal vacuum in the regulation to be filled by member states' national laws (under Article 88(2)). This question arose in the Alicante court due to the fact that, under Spanish design law, both the rights to designs produced in the context of an employment relationship and the rights to designs produced as a result of a commission belong to the employer or commissioner, unless otherwise agreed.

 

The advocate general stated that to answer this question, the scope of the term 'successor in title' in Article 14(1) should be clarified. To this end, at the hearing the European Commission contended that the term 'successor in title' refers only to succession through death and mergers between companies. In contrast, the advocate general opined that, in light of the regulation's preparatory works, 'successor in title' should be understood as the assignee of the rights to the Community design, therefore referring to both the employer and the commissioner. The difference is as follows: with regard to the employer, in general the right to the design belongs automatically to the employer; while with regard to the commissioner, the ownership of the design is to be defined by the parties and by the law applicable to the civil or commercial contract at issue.

 

In light of this, the advocate general declared that, by virtue of Article 88(2) of the Community Design Regulation, the Alicante court should apply the Spanish provisions governing the contract between Acierta and Cul de Sac to determine the ownership of the Community designs at issue in the FEIA claim. He clarified that Spanish law was not contrary to Article 14(3) of the regulation, even though for the determination of ownership it equates designs produced in pursuance of a commission with designs developed by an employee within an employment relationship.