BlueScope Steel Limited v Gram Engineering Pty Ltd

Vertical orientation 163 Bluescope advanced a number of submissions when challenging the primary judge's finding that the Design is to be considered as one in which the sawtooth pans extend vertically down the face of the fencing panel sheet. These submissions can be summarised as follows: Orientation is not a feature of shape or configuration. The Design should not be construed by reference to one particular use of the article to which the Design will be applied. Bluescope submitted that the primary judge went further than construing the Design with an "instructed eye". The primary judge "read into the Design" other features, such as posts and rails. The primary judge was wrong to rely on Mr Wightley's evidence because, amongst other things, Mr Wightley took into account considerations of utility. The primary judge erred in finding that the vertical orientation of the Design gave it novelty or originality over the prior art. Bluescope submitted that the prior art articles are only relevant in respect of their shape, not the orientation of the articles to which those shapes have been applied. Vertical orientation is not a feature of the Design. Bluescope submitted that if vertical orientation is a feature of the Design, it does not confer novelty or originality over the prior art because symmetrical Z-shaped designs were not novel or original. 164 In order to appreciate the thrust of Bluescope's submissions, it is important to distinguish between how an article to which a design has been applied may be orientated irrespective of its design, and how a design, properly construed, is intended to be applied to the article in respect of which it is registered. In other words, the design itself may have a specific orientation which, when properly applied to the relevant article, imparts the orientation in which the article should be viewed. In this way, the orientation of a design may be a substantial contributing factor to the appearance of the article to which it has been applied. 165 In the present case, the primary judge found that the Design has a specific orientation. In arriving at that conclusion, the primary judge correctly noted that there is no express mention in the registration that the pans have a vertical orientation. Nevertheless, his Honour found that a proper reading of the Design indicates that orientation. 166 In my respectful view, the primary judge was plainly correct in coming to that conclusion. Here, the accompanying representations illustrating the Design unequivocally show that the flanges are located at the sides of the sheet, not at the top and bottom ends of the sheet. This means that the pans must have a vertical orientation. This is not a reading of the Design which necessarily requires the assistance of expert evidence. In my view, it is the obvious conclusion to be drawn from looking at the accompanying illustrations, particularly the second illustration representing a side view of the sheet, which clearly shows a flange as a side element. 167 Mr Halpern (one of Bluescope's witnesses) gave evidence that he read the representations as depicting the pans running vertically because the end forms (that is, the flanges) are designed to overlap adjoining sheets within (I infer, vertically within) posts and rails. Mr Wightley (Gram's expert witness) gave evidence to the same effect. He pictured the pans in a vertical orientation meeting or overlapping in a neat way to form a continuous fence fitting together at the edges between posts and rails. 168 The primary judge's reference to Mr Halpern's and Mr Wightley's conception of the vertically orientated sheets fitting within posts and rails appears to be the reason for Bluescope submitting that the primary judge read into the Design "features and requirements … which do not and cannot form part of the monopoly of the Design". 169 Mr Wightley also gave evidence that, if installed horizontally, a fencing panel sheet made according to the Design would be likely to buckle or deform. In other words, the "stiffeners" (that is, the "sawtooth within a sawtooth" feature) would not perform their apparently intended function. The primary judge's reference to this evidence is the reason for Bluescope submitting that the primary judge impermissibly took into account questions of utility when construing the Design. 170 In my view, the primary judge did not err in taking Mr Halpern's and Mr Wightley's evidence into account, in the particular way in which his Honour did, when construing the Design. 171 First, I do not accept that the primary judge read into the Design features and requirements that were not part of the Design. Rather, the primary judge treated the Design for what it truly is - a design for a fencing panel sheet. The description of the article as a panel sheet conveys, as a matter of ordinary language, the notion that the article to which the Design is intended to be applied, is one to be supported by or enclosed within some structure, frame or border. In the context of fencing (a fencing panel sheet), this would clearly include, but would not necessarily be confined to, a structure, frame or border provided by posts and rails. But, by referring to Mr Halpern's and Mr Wightley's evidence in this regard, the primary judge did not thereby incorporate additional features, such as posts and rails, into his construction of the Design itself. 172 Secondly, Mr Wightley's evidence that the "sawtooth within a sawtooth" feature has an apparent functional significance, as well as a visual significance, plainly assists in understanding whether the Design has a specific orientation. This appreciation is not tantamount to judging the validity of the Design, in terms of its novelty or originality, by its utility as opposed to its appearance. Whether or not the "sawtooth within a sawtooth" feature would usefully act as a stiffener and would, by reason of such utility, distinguish the fencing panel sheet of the Design from prior fencing panel sheets or other analogous items, is not a question that is relevant to the novelty or originality of the shape or configuration claimed as the Design: Moody v Tree (1892) 9 RPC 333. Clearly, the primary judge did not treat utility in that way. However, his Honour correctly reasoned (at [209]) that it would be artificial to exclude from the construction of the Design an appreciation, through the instructed eye, that one of its visual features also has an apparently intended functional significance. When one has that appreciation, the presence of the "sawtooth within a sawtooth" feature assists in understanding whether the Design has a specific orientation. If so, the question is whether the Design, as so construed (that is, with its specific orientation), is new or original as a matter of, relevantly, shape or configuration applied to a fencing panel sheet. This is the correct question, which the primary judge addressed. 173 In my view, it is beside the point that, as Bluescope suggested in argument, someone might seek to install a fencing panel sheet to which the Design has been applied, in a fashion in which the pans run horizontally and not vertically. This is not the intended use of an article made according to the Design. In the case of the commercial embodiment of the Design (the GramLine product), the use of the sheet with the pans running horizontally is not a use that was promoted or, indeed, suggested by Gram. Moreover, in relation to the Smartascreen product, such use is not a use of that product that was promoted or suggested by Bluescope. The aberrant use of an article to which the Design or an alleged imitation of it has been applied, can be put to one side. 174 The vertical orientation of the pans distinguishes the Design from the prior art designs having sawtooth or sawtooth-like profiles. The prior art designs do not reveal, at the relevant time, the existence of a fencing panel sheet of a sawtooth design where the pans extend vertically down the face of the sheet, let alone such a fencing panel sheet which is symmetrical in appearance, front and back, when viewed in that orientation. The prior art cladding, represented by Designs 2, 4, 5, 6, 8, 12, 16, 18, 19 and 23 - which the primary judge described, collectively, as simulated or faux weatherboard (but which also include roofing elements) with pans running across the width of the articles - has a horizontal orientation. In that orientation, these designs do not present a symmetrical appearance, front and back. Further, these designs possess other features, not found in the Design, which materially contribute to the appearance of the articles to which each is intended to be applied, and which further distinguish them from the Design. The prior art designs represented by products such as the Trimdeck and Custom Orb products do not present a sawtooth appearance.

The sawtooth design 175 Bluescope's submissions dealt separately with the primary judge's findings concerning, first, the significance of the number of vertical pans in the Design and, secondly, the significance of the particular appearance of the sawtooth shape of the Design. 176 Bluescope submitted that the primary judge erroneously regarded the number of pans as being relevant to the novelty or originality of the Design. Bluescope submitted that it is the repeating pattern of the pans that provides a visually striking feature, not the number of pans in the Design. Bluescope also submitted that the primary judge did not have regard to "the potential for the prior art to be repeated to achieve six panels across the same (hypothetical) panel width", or consider a comparison with "designs of the same relative scale". 177 In my view, the primary judge did not err by taking into account, when assessing novelty or originality, the number of pans per fencing panel sheet shown in the Design. The number of pans is plainly part of the combination that is claimed as the Design. The Design is not merely one for a fencing panel sheet having an indefinite number of repeating pan-like elements. Rather, it is for a fencing panel sheet having six vertically orientated pans, bounded on each side of the sheet by flanges having a particular appearance. As the statement of monopoly makes clear, only the longitudinal extent of the fencing panel sheet "is to be disregarded". The longitudinal extent of the fencing panel sheet, in the context of the accompanying representations of the Design, is plainly a reference to the length of the sheet, top to bottom, in its vertical orientation. 178 With respect to the amplitude, wavelength and angles of the sawtooth shape, Bluescope submitted that, when a side-by-side comparison of the prior art designs with the Design is undertaken, the range of amplitude, wavelength and angles that give the Design its novelty is "narrow". Bluescope relied, in particular, on Designs 2, 4 and 6 of the prior art which, it submitted, are examples of sawtooth shapes having similar amplitude, wavelength and angles to the amplitude, wavelength and angles of the sawtooth shape of the Design. However, to argue that particular prior art designs exhibit sawtooth shapes having similar amplitudes, wavelengths and angles to the Design does not advance matters significantly when other features of the Design distinguish it from the prior art designs. Whilst as a matter of systematic exposition, one can describe and compare, in turn, separate features of shape or configuration in given designs, it is, of course, the combination of features - the overall appearance - of a design which is important. 179 As Young J put the matter in Ullrich Aluminium Pty Ltd v Dias Aluminium Products Pty Ltd (2006) 153 FCR 437 at [64]: … Even if one or other piece of prior art contains a particular feature that is similar to that found in the registered design, does the blending together of a number of features of that kind, alongside other features of style, configuration or pattern, result in a combination that has a special and distinctive appearance which is new or original? ... 180 The primary judge was mindful of this fact, noting at [255] that none of the items of prior art relied upon by Bluescope had the same combination of six pans with the proportions and angles shown in the representations of the Design. His Honour's reasons also make clear that this particular finding was not divorced from, and should not be seen in isolation from, his Honour's finding concerning the orientation of the six pans: none of the prior art designs had "sawtooth pans that extend vertically down the face of the sheet": see at [245] and [246].

Overall conclusion on novelty or originality 181 The features of the Design identified by the primary judge are features of substance, all of which contribute materially (although in different ways) to the overall shape or configuration of the fencing panel sheet to which the Design is to be applied. In my respectful view, the primary judge's analysis does not reveal any error in his Honour's identification of those features or with respect to the significance which his Honour gave them, as a matter of design construction. 182 Similarly, the differences noted by the primary judge, when comparing the Design with the prior art designs, are differences of substance, all of which contribute materially (although in different ways) to distinguishing the Design from the prior art designs, in terms of novelty or originality. In my respectful view, the primary judge's analysis does not reveal any error in his Honour's identification of those differences or with respect to the significance which his Honour gave them, as a matter of design comparison. 183 The primary judge's assessment of these features and differences plainly informed his Honour's understanding of the scope of the monopoly in the Design, when considering the question of obvious imitation.

Obvious imitation 184 The foundation for Bluescope's challenge to the primary judge's finding that the design of the Smartascreen product is an obvious imitation of the Design, is its contention that the scope of the monopoly in the Design is narrow and: … is found in the distinguishing sawtooth-within-a-sawtooth feature in the middle of each pan together with a particular combination of amplitude, wavelength and angles. 185 Bluescope submitted that it is these features of the Design that must be considered when assessing infringement. In other words, it submitted that when comparing the Design and the design of the Smartascreen product, it is the presence or absence of these features in the design of the Smartascreen product that is critical to the analysis of whether that design is an obvious imitation of the Design. 186 The following matters should be noted. 187 First, in confining the comparison in this way, Bluescope seeks to put to one side the fact that the Design is one in which the sawtooth shape defines six vertically orientated pans bounded at the sides of the sheet by flanges of a particular shape, such that the sheet is symmetrical in appearance when viewed from front and back. However none of the prior art designs exhibits this combination. Each prior art design is of a markedly different appearance. Yet, this combination is, undoubtedly, a fundamental part of the design of the Smartascreen product. 188 Secondly, Bluescope's contention that the sawtooth shape of the Design is formed by a particular combination of amplitude, wavelength and angles is undoubtedly correct. But this does not mean that the amplitude, wavelength and angles of the sawtooth shape of the Design should be confined to the very narrow limits that Bluescope's contention seems to imply. One sawtooth shape may closely resemble another in appearance, even though the former does not possess the same amplitude, wavelength and angles of the latter. The issue is one of eye appeal, not geometric identity or exactitude. Further, the sawtooth shape of the Design, and the sawtooth shape of the design of the Smartascreen product, should not be considered in isolation from the particular combination referred to in the preceding paragraph. 189 There are, however, two features of the design of the Smartascreen product to which reference should be made. 190 The first is that the rendering of the sawtooth shape in the design of the Smartascreen product includes a "ridge/valley" feature. This feature is visible in the image of the Smartascreen product reproduced at [53] of the primary judge's reasons. It is also identified in Figure 6 in an affidavit made by Bluescope's expert, Mr Richardson. Figure 6 is reproduced at [61] of the primary judge's reasons. The ridge/valley feature is identified by the letters A and B. This feature affects the appearance of the sawtooth shape in the design of the Smartascreen product. It also affects the amplitude, wavelength and angles of that shape. Bluescope submitted that the Smartascreen sawtooth profile is "more complex and subtle with more bends and angle changes than the Design". 191 The second feature is that the design of the Smartascreen product has "micro-fluting" on the face of each pan. This feature can also been seen in the photograph reproduced at [53], and in Figure 6 (see letter C) reproduced at [61], of the primary judge's reasons. 192 Given that the design of the Smartascreen product has, but the Design does not have, the ridge/valley feature and the micro-fluting feature, and given that the Design has, but the design of the Smartascreen product does not have, the sawtooth within a sawtooth feature, the question for the primary judge was whether these differences meant that the design of the Smartascreen product could not be an imitation, let alone an obvious imitation, of the Design - even though the design of the Smartascreen product possesses all the other features that distinguish the Design over the prior art designs and render it to be a new and original design when applied to a fencing panel sheet. 193 On appeal, Bluescope submitted as follows: Smartascreen does not have the novel and original features of the Design, namely, the distinctive sawtooth within the sawtooth or the same amplitude, wavelength and angles. When judged by the eye, the differences between Smartascreen and the Design are substantial and immediately apparent. Those differences are material given the narrow scope of Gram's monopoly in light of the prior art corpus … The absence in Smartascreen of the novel and original features of the Design, together with the striking additional features present in Smartascreen, mainly the ridge/valley and micro-fluting features, mean that there is no obvious imitation. Smartascreen does not bear a "very close" or "almost unmistakable" resemblance to the Design. 194 The primary judge rejected a similar submission at trial. The critical passage of the primary judge's reasons is at [324]: In my opinion, when the Smartascreen panel is viewed as a whole the dominant visual feature is the repeating sawtooth profile consisting of six pans or modules, and the amplitude, wavelength and angles. These features give it a striking physical similarity to the Design and the GramLine product. This is so notwithstanding the difference in the Smartascreen panel consisting of the ridge/valley effect and the micro-fluting. In my opinion those features are comparatively slight and are not sufficient to detract from the overall visual picture of the Design and the GramLine product which I have described above. … 195 Once again, it is clear that, when referring to the repeating sawtooth profile consisting of six pans or modules, the primary judge was referring to the six pans or modules being disposed in a vertical orientation. 196 The primary judge gave a number of reasons for coming to this conclusion. These included a preference for the views expressed by Mr Wightley, rather than the views expressed by Mr Richardson, on the degree of similarity between the Design and the design of the Smartascreen product. In expressing this preference, it is clear that his Honour's acceptance of Mr Wightley's views was based on the fact that they accorded substantially with his Honour's own perceptions and appraisal. 197 The primary judge's reasons also included reference to Bluescope's commercial justification for developing and launching the Smartascreen product. Bluescope submitted that the primary judge was in error in taking this matter into account. It submitted that this consideration was "inapposite" in the context of considering the question of obvious imitation. Whether this is so, depends on how, precisely, the primary judge sought to rely on this matter. 198 In this part of his reasons, the primary judge noted the emphasis that Bluescope placed on producing a product that "looked the same from both sides": see at [338]. The primary judge also noted (at [339]) the content of a discussion paper dated 26 April 2001 that had been prepared by Ms Marlin, the Business Development Manager in Bluescope's Marketing Division. This is an important document. It is discussed in detail in earlier passages of his Honour's reasons. It contains the recommendation on which Bluescope proceeded for the commercialisation of the Smartascreen product, whose design was then referred to as Cascade 2000. In that paper, Ms Marlin said with respect to the GramLine product (the commercialisation of the Design): Cascade 2000 has a similar appearance to Gramline (sawtooth style profile) and hence it is felt that the product will be readily accepted in the market remembering that the fencing market is traditionally slow to accept new profiles). It is likely the profile will be considered an acceptable substitute in new housing developments currently dominated by Gramline. 199 Later in the paper, Ms Marlin said: …it is recommended urgent approval be given to pursue Option 3 in the 'Cascade 2000' profile (Gramline substitute) to enable us to defend our market position and prepare for further growth… 200 When considering the question of obvious imitation, the primary judge referred to the attraction that Cascade 2000 had for Bluescope because "it had a similar appearance to the GramLine sawtooth profile and would gain ready market acceptance": see at [339]. In making that observation, I am of the view that the primary judge was doing no more than placing reliance on Bluescope's own acknowledgement - expressed contemporaneously at a marketing level - that there was indeed a real similarity in appearance between the Design and the design of the Smartascreen product, which rested in the sawtooth profile. This is the very feature which, in the context of the proceeding for infringement, Bluescope has sought to downplay. Ms Marlin's view can be taken as a reliable and expert opinion that this visual feature would be the abiding impression of shape or configuration created in the minds of purchasers of the Smartascreen product, not the ridge/valley feature or the micro-fluting feature. This evidence coincided with the primary judge's own view that the dominant visual feature of the Design is the repeating sawtooth profile. The primary judge saw it as pointing in favour of a finding of obvious imitation. 201 So understood, I can see no error in the primary judge's reliance on Bluescope's commercial justification. It is important to note that the primary judge was careful to make clear in his reasons that he was not relying on this evidence as a manifestation of deliberate copying, which would be a relevant consideration when considering whether the design of the Smartascreen product is a fraudulent imitation of the Design. Indeed, when dealing with this evidence in this part of his reasons, the primary judge stated that he did not consider the Smartascreen panel to be a fraudulent imitation of the Design. 202 In my view, the primary judge's finding that the design of the Smartascreen product is an obvious imitation of the Design is one that was open to his Honour, particularly having regard to the scope of the monopoly of the Design, properly understood. The primary judge's comparison of the design of the Smartascreen product with the Design proceeded on correct legal principles. That being the case, the primary judge's conclusion that the design of the Smartascreen product is an obvious imitation of the Design is really a practical and evaluative judgment resting on matters of impression and degree. I am not persuaded that, in exercising that judgment, his Honour erred. For this reason, the appeal should be dismissed.

Fraudulent imitation 203 I agree with Besanko and Middleton JJ's reasons for concluding that Gram's cross-appeal against the primary judge's finding that there was no fraudulent imitation, should be dismissed.

Disposition 204 I agree with the orders proposed by Besanko and Middleton JJ. I certify that the preceding fifty-four (54) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Yates.