Lockwood Security Products Pty Ltd v Australian Lock Company Pty Ltd

REASONS FOR JUDGMENT 1 The applicant, Lockwood Security Products Pty Ltd ("Lockwood"), instituted this proceeding against the respondent, Australian Lock Company Pty Ltd ("Alco"), seeking inter alia, to expunge a number of Alco's registered designs from the Register of Designs ("the Register"). The Register is maintained by the Designs Office pursuant to ss 9 and 33 of the Designs Act 1906 (Cth) ("Designs Act") (as it then was, this Act has since been repealed and replaced by the Designs Act 2003 (Cth)). 2 Pursuant to O 29 r 2 of the Federal Court Rules, Alco sought the determination of two questions prior to trial to establish whether Lockwood had standing pursuant to ss 28 and 39 of the Designs Act to claim relief under that Act. By way of an amended notice of motion, Alco asked the Court to determine: (a) Is Lockwood a 'person aggrieved' within the meaning of s 39 of the Designs Act? (b) Is Lockwood a 'person interested' within the meaning of s 28 of the Designs Act? 3 In a related proceeding, Australian Lock Company Pty Ltd v Lockwood Security Products Pty Ltd (V 733 of 2001), Alco asserts that it has standing under the same two provisions of the Designs Act for the purpose of challenging the registration of a number of Lockwood's registered designs. The parties accept that if Lockwood is found not to have standing to bring its proceeding, then nor will Alco have standing to bring its proceeding against Lockwood in the related matter.

Factual Background 4 Both Lockwood and Alco manufacture locking systems for the high security end of the Australian lock market. They are two of the major suppliers of high security locking systems and sell essentially the same types of products to the same customers for the same applications. They are in direct competition with one another in a relatively small market. A third supplier, Assa Abloy AB, was identified in Lockwood's submissions, but it is a foreign company which controls Lockwood and not a principal player in the Australian high security lock market. 5 Lockwood supplies a locking system incorporating a single bladed key under the trademark 'Lockwood Twin.' Alco supplies a locking system incorporating a dual bladed key under the trademark 'BiLock.' It is common ground that the products are not identical, and have significantly different features that distinguish them from each other in the marketplace. 6 Lockwood is the exclusive manufacturer and supplier of key blanks that can be used to create a duplicate Lockwood Twin key. Similarly, Alco is the exclusive manufacturer and supplier of key blanks that can be used to create a duplicate BiLock key. 7 The keys and key blanks for the Lockwood Twin locks are significantly different in appearance from the keys and key blanks used in BiLock locks. 8 Lockwood seeks to impugn 33 designs registered by Alco, ("the designs in suit"), which designs are said to correspond with key blanks for Alco's BiLock locking system. 9 Neither Lockwood nor Alco has manufactured, and neither has plans to manufacture, key blanks suitable for use to create a duplicate of the other company's trademarked locking systems. 10 The parties agreed that the ability of a lock manufacturer to prevent the unauthorised duplication of keys is a significant issue in the high security lock market. A manufacturer is able to prevent unauthorised duplication of keys where the key blanks required to duplicate the keys are only available from a limited number of 'authorised' outlets, that is, outlets which are contractually bound to the manufacturer to satisfy themselves prior to duplicating a key that the purchaser of the lock system has authorised such duplication. 11 The parties submitted that a design registration corresponding with a particular key blank provides some protection against the risk of an outlet which is not authorised from obtaining a key blank, because the owner of the registered design could bring infringement proceedings under Pt V of the Designs Act to enjoin the supply of the key blank. 12 In addition to the threat of Pt V proceedings, a number of otherfactors were identified by the parties that may decrease the risk of an unauthorised outlet obtaining key blanks. These included patent protection, the cost and availability of specialised equipment for duplicating keys, the cost and difficulty of manufacturing key blanks within required tolerances and the corresponding low level of demand for high security keys to be duplicated by unauthorised outlets. Further, running an unauthorised outlet would be against professional Codes of Conduct for members of the Master Locksmiths Association of Australia. 13 However, the parties acknowledged that the scope of design protection for key blanks was limited because a functional equivalent of the key blank could be manufactured without infringing the design monopoly of the key blank. 14 As major competitors in the Australian market for high security locking systems, Lockwood and Alco promote the existence of their design registration portfolio and use it as part of their marketing strategies. Both parties acknowledged that promotion of design protection in product marketing may influence customers' purchasing decisions, however the degree of influence of this marketing was at the heart of the present dispute. 15 Lockwood contended that Alco's marketing of design protection influences purchasing decisions to the extent of a 'reasonable apprehension' that the purchaser would be substantially influenced by such marketing. 16 Various promotional publications, including those published by Lockwood and Alco, were tendered by Lockwood to demonstrate the emphasis on patent and design protection. Alco submitted that the publications were relevant to Lockwood's complaint in the primary proceeding concerning s 52 of the Trade Practices Act 1974 (Cth), but were not relevant to the present issue of standing raised by Alco's amended notice of motion. 17 Further, Lockwood pointed to the Australian Standard for locksets, AS 4145.2‑1993 Locksets, which provides for a number of designations of high security applications and requires a locking system to have either patent and/or design protection in order to be classified within the two highest designations. 18 Alco submitted that, subject to the qualification that it is patent or design protection that is referred to in its marketing, it would accept that design protection is a 'critical marketing tool' when selling a keying system to clients who want a high level of security.

The statutory context 19 Section 39 of the Designs Act provides for rectification of the Register in the following terms: "(1) Subject to this Act, a prescribed court, on the application of any person aggrieved, may order the rectification of the register by: (a) the making of any entry wrongly omitted to be made in the register; or (b) the expunging or amendment of any entry wrongly made in or remaining on the register; or (c) the correcting of any error or defect in the register. …" [emphasis added] 20 Section 28 of the Designs Act provides for the cancellation of registration of a design and for licensing: "At any time after the registration of a design any person interested may apply to a prescribed court: (a) for the cancellation of the registration of the design on the ground that the design has been published in the Commonwealth prior to the priority date in respect of the application for registration of the design; or (b) for the grant of a compulsory licence on the ground that the design is applied by manufacture to any article in a country outside the Commonwealth and is not so applied in the Commonwealth to such an extent as is reasonable in the circumstances of the case; and the court may make such order on the application as it considers just:

Provided that the court shall not make any order under this section which is at variance with any treaty, convention, arrangement or engagement with any country outside the Commonwealth".

The issues to be decided 21 Alco's motion raised two questions for determination by the Court:

1. Is Lockwood a 'person aggrieved' within the meaning of s 39 of the Designs Act?
2. Is Lockwood a 'person interested' within the meaning of s 28 of the Designs Act? 22 Both parties submitted that if Lockwood satisfies the 'person aggrieved' test under s 39, it will also necessarily satisfy the 'person interested' test within s 28 of the Designs Act and accordingly argument was directed primarily towards the meaning of 'person aggrieved.' 23 Alco submitted that the two different expressions of standing appear to have the same meaning. Reliance was placed on the observations of Professor S. Ricketson that: "Assuming that the term 'person interested'means the same as 'person aggrieved', [s 28(a)] appears to overlap with the power of a prescribed court to expunge wrongly made entries pursuant to s 39(1)(b). Furthermore, it has been interpreted as being concerned with a much narrower question than that which is raised when the novelty or originality of a design prior to its registration is attacked, either by way of counter‑claim in infringement proceedings, or in an application for rectification under s 39… … The original reason for this difference may have been that, up to 1979, s 28 applications could only be brought in the High Court, while those for rectification under s 39 were brought in the State Supreme Courts. Although the [Designs Law Review Committee, Report on the Law Relating to Designs 1973,] recommended the deletion of s 28(a), this was not done…" (S. Ricketson and C. Creswell, The Law of Intellectual Property: Copyright, Designs and Confidential Information, vol. 2, Law Book Company, 2003, at [22.210]) 24 Lockwood submitted that the scope of s 28 is conspicuously narrower than the scope of s 39. In making this submission reliance was placed on In Re Wolanski's Registered Design (1953) 88 CLR 278, which involved an application to cancel registration under s 28 (as it then was, the present text of the section is altered only in respect of the venue in which an application may be brought). Kitto J explained at 280 that the relevant question is: "a much narrower one than that which arises when the validity of a registration under the Act is attacked on the ground that the design was not new and original at the date of registration. Where that ground is raised and is supported by proof of prior publication, the issue is whether there is a difference between the conception of the shape previously published and the registered design…But on an application to this Court to exercise the jurisdiction given to it by s 28, the applicant must establish, as the section plainly shows, a prior publication of the registered design itself. He cannot rely upon publication of a different design, even though it be sufficiently similar to justify a finding of lack of novelty and originality in the registered design." 25 Kitto J then referred to Re Radnall's Registered Design (1934) 51 RPC 164, a decision of Luxmoore J in the United Kingdom Patents Appeal Tribunal which considered ss 58(1) and 72 of the Patents and Designs Acts 1907‑1932(UK) which provisions correspond with ss 28 and 39 of the Designs Act. There, Luxmoore J said at 166: "Section 58 confers on any person interested, after the registration of a particular design, the right to apply to the Comptroller for cancellation of the registration, and the first subsection provides that one ground on which cancellation can be asked for is that the design has been published in the United Kingdom prior to the date of registration. Nothing is said there about the novelty or originality of the design or anything of that sort. By Section 72 any person aggrieved in respect of any matter with regard to the registration of a design may apply, not to the Comptroller, but to the Court for rectification of the Register by expunging the registration or by varying the entry, and in any proceedings under that Section the Court may decide any question that may be necessary or expedient to decide in connection with rectification of the Register. That would cover, of course, the question of whether the design as published is new or original. It seems to me that in proceedings under Section 58 the only question that can be determined is whether there has been prior publication or not. This is a much narrower question than whether the design is new or original." 26 In Hosokawa Micron International Inc v Fortune (1990) 26 FCR 393 Gummow J examined the history of the Australian designs legislation and observed at 415: 'In the Second Reading Speech in the Senate, on 20 June 1906, on the Bill for what became the Designs Act, it was said (Hansard, Senate, p 394): The Bill may be said to be a legislative expression of the English law as it exists at present. The English statutory law is found in the Patents Designs and Trade Marks Act of 1883, subsequently amended by statutes up to as far as 1888. That legislation, together with what has been the interpretation of it by the Judiciary in Great Britain, may be said to be the substance of this Bill.' 27 Thus, although not sitting in a judicial capacity, what Luxmoore J said in Re Radnall's Registered Design (supra) is relevant to the present issue. 28 Notwithstanding the history of the difference in the venue in which ss 28 or 39 proceedings could be instituted, the prevailing theme is that the scope of s 28 is narrower than s 39. It seems that s 28 is confined to the determination of the question whether there has been prior publication or not, whereas s 39 is concerned, at least, with the question whether a design is new or original. 29 While the terms 'person interested' and 'person aggrieved' may themselves be like expressions, it does not follow that achievement of standing under s 39 will necessarily suffice to attract standing under s 28. The test for s 28 is quite specific: the complainant must establish an interest relevant to the question of whether or not there has been prior publication in the impugned design itself. 30 Entry on the register is initially for a period of twelve months: s 23, s 27A(1) of the Designs Act. Three extensions may be applied for, each providing for an additional five year period of registration: ss 27A(2), (8), (12) and (13) of the Designs Act. While an attack on a design made in the early stages of registration allows for a broader inquiry, which includes prior use, the designs in suit are registered designs. 31 It is not apparent from what has been put before the Court that this is the nature of the complaints made. Immediately, it can be seen that one of the questions may be disposed of - there is no assertion of prior publication in the Commonwealth and, as a result, the question for decision is whether Lockwood can make out standing within the terms of s 39.

The submissions 32 Both Lockwood and Alco have registered a number of designs which are said to correspond to the respective Lockwood Twin and BiLock key blanks. In this proceeding, Lockwood has pleaded that Alco's key blanks do not correspond with its registered designs, and are therefore not protected by them. Although counsel for Lockwood contended in oral argument that, synoptically, Lockwood's complaint is that Alco's designs are not novel, Lockwood did not elaborate on this point and relied on the evidence identified in its written submissions. The purpose of the evidence submitted was to show the extent to which Alco's use of its design registration is used as a marketplace competitive tool. 33 In its submissions Lockwood contended that it's approach to design registration has been to lodge the designs in its range all at once, with the consequence that a number of the registered designs have expired, or are due to expire, in the next few years. Lockwood submitted that the registered designs for the Lockwood Twin key blank and cylinder lock key blank are due to expire on 15 December 2015. The cross‑sectional shape of the keyway of the lock barrel of various profiles of the Lockwood Twin product are registered designs which will expire on 15 December 2005. 34 By contrast, Lockwood complained that Alco had approached its design portfolio differently by engaging in what it called 'serial filings' of its designs, with the consequence that design registration protecting key blanks for its various locking systems expired at different times, and some were not due to expire for a number of years. Alco submitted that the expiry of registration for the designs in suit is due to occur both prior to, and subsequent to, 15 September 2016. 35 As a consequence of the differences between the two approaches to registration, Lockwood contended that Alco has sought to convince Lockwood's customers and potential customers to purchase Alco's range over Lockwood's range by targeting customers with marketing featuring the existence and longer duration of Alco's design protection at a time when Lockwood's registered designs had expired or were about to expire. Lockwood complained that Alco does this to differentiate its high security locking system from that of Lockwood, and seeks by this means to secure a competitive advantage over Lockwood in the high security end of the lock market in Australia. 36 Lockwood contended that, as a consequence, by having design registration over key blanks for their high security locking systems, Alco is able to attract customers who otherwise might purchase Lockwood's products which serve a similar purpose. This, Lockwood said, places it at a real competitive disadvantage and diverts sales from Lockwood. 37 Alco contended that Lockwood did not satisfy the requirements of standing under ss 28 or 39 of the Designs Act, not having been sued for infringement in respect of the designs in suit, not having an intention to manufacture or sell key blanks falling within the monopoly granted in respect of the designs in suit, and essentially having no more than a commercial complaint that registration of the designs in suit enables Alco to refer to such registration in the course of its marketing activities. It submitted that Lockwood did not suffer any legal or practical disadvantage by reason of the registration of the designs in suit and that, accordingly, Lockwood's complaint derived from a different 'sphere of interest' to that interest with which the Designs Act is concerned.

The Designs Act 38 The Designs Act establishes a statutory scheme whereby the visual form of a mass produced article - being a conception of shape, configuration, pattern or ornamentation (but not a method or principle of construction) - which is sufficiently 'new or original' is given protection through the grant of a monopoly right. 39 Lockwood noted that the Designs Act contains no express statement as to its object or purpose, and made a number of submissions, principally drawing from secondary writings on the subject, which are in essence expressed in the Australian Law Reform Commission's report on designs: "The primary objective of designs law is to encourage innovation in Australian industry to Australia's net economic benefit…Design is a crucial element of innovation and is pivotal in commercialisation and marketing processes… Designs protection is intended to encourage innovation in industrial design in two main ways: by preventing competitors free riding on design innovations and by providing investors in design innovation with security for their investment…" (Australian Law Reform Commission, Designs, Report No 74 (1995), at [3.2]‑[3.3.]) ("ALRC Report"). 40 The scope of the scheme is narrow in the sense that design protection is for 'one particular individual and specific appearance' applied to the article the subject of registration: see Firmagroup Australia Pty Ltd v Byrne & Davidson Doors (Vic) Pty Ltd (1987) 180 CLR 483 at 488 and In Re Wolanski's Registered Design (supra) at 279‑280. Moreover, the Designs Act is concerned with shape and configuration, not function: see Macrae Knitting Mills Ltd v Lowes Ltd (1936) 55 CLR 725 at 730. In Firmagroup Australia Pty Ltd v Byrne & Davidson Doors (Vic) Pty Ltd (supra) the High Court said at 487: "Specificity of shape and configuration must be conveyed by a registrable design; features of a design which do no more than convey the idea of a general shape appropriate to the function which the article is intended to perform and which are consistent with a variety of particular shapes in articles copying those features are not amendable to protection by the Act." 41 Once registered, the design, or any obvious or fraudulent imitation thereof, cannot be applied to articles in respect of which the design is registered without the licence or authority of the owner of the design. Nor can articles to which a design or imitation thereof has been applied be imported or sold without such licence or authority: s 30 of the Designs Act. If a registered design is infringed, a court may grant an injunction, damages or an account of profits: s 32B of the Designs Act. 42 The monopoly right granted upon registration is of a limited duration, it may last for a maximum period of 16 years from the date of registration: s 27A of the Designs Act. Designs are initially registered for twelve months, with three options of five‑year extensions available. However, as s 28 provides for cancellation of registration on the ground of prior publication in the Commonwealth, while the monopoly protection is for a limited duration, succession of the monopoly for that design is not contemplated. 43 Design applications are assessed prior to registration. For the purposes of registration, a design will be taken to be new or original unless at the priority date it has been preceded by a design that is identical or substantially similar, as determined by comparing the design with the prior art base. That art base consists of those designs which are registered, published or used in Australia prior to the priority date: see ALRC Report at [5.32]‑[5.39]. 44 Lockwood submitted that any doubts as to whether a design is capable of registration are resolved in favour of the applicant, citing Re Albion Hat & Cap Company Pty Ltd (1991) 21 IPR 558. It should be noted, however, that this principle was judicially applied in the particular circumstance where the applicant was not seeking an independent or prolonged monopoly. That is not to say that the procedures of the Designs Office, such as the Australian Designs Officer Examiners' Manual, may not adopt a liberal approach. However, such procedures have little bearing on judicial resolution of an application for standing in relation to a design already registered. 45 Lockwood also submitted that, in practice, the search process carried out by the Designs Office during examination is limited and is unlikely to disclose relevant prior art other than existing registered designs. In hand with this submission is the proposition that the scheme of the Designs Act provides very limited opportunities for a third party to scrutinise a proposed registration, and as a consequence it is not until a party is in the position which Lockwood now finds itself in that a registration may be impugned through ss 28 or 39, or by infringement proceedings under Pt V of the Designs Act. This being so, Lockwood submitted that the structure of the Designs Act teaches powerfully in favour of the proposition that there is no good reason to read down the term 'person aggrieved.' 46 It is relevant at this point to note that the current registration scheme provided for by the Designs Act is not without its critics. In introducing the Designs Bill 2002 (Cth) ("the Bill") into Federal Parliament, it was said: "This bill will repealthe Designs Act 1906 and implement a new registration system for industrial designs. It represents a fundamental change to the registration and protection of industrial designs in Australia and is the culmination of many years of review and consultation." (Commonwealth, Parliamentary Debates, House of Representatives, 11 December 2002, 10080 (Warren Entsch, Parliamentary Secretary to the Minister for Industry, Tourism and Resources)). 47 It is noted that the Designs (Consequential Amendments) Bill 2002 (Cth) which was introduced at the same time deals with copyright overlap issues which are not relevant to this proceeding. 48 The Explanatory Memorandum to the Bill explained: "The Bill derives from an exposure draft of the Designs Bill 2001, which the Government released and invited public comment on in May 2001. This exposure draft incorporated changes to the designs legislation implementing the Government's response to the 1995 report of the Australian Law Reform Commission Report No. 74, Designs. The proposed changes to the design system include a more streamlined registration system, better enforcement and dispute resolution procedures, stricter eligibility and infringement tests and clearer definitions. … [11] The new threshold test will be a two step test; namely, a design will not be registrable unless it is both new and distinctive. The requirement for a design to be new will be a filter to eliminate identical designs. The term 'distinctive' is intended to require greater differentiation than at present from previously published or used designs. The test of whether a design is distinctive will be one of substantial similarity in overall impression. This test will provide that minor or insignificant changes to a design are irrelevant if the overall impression remains one of substantial or significant similarity. … [13] The threshold for registration will also be raised by expanding the prior art base, which is the body of publicly available information that a design is compared with to determine whether or not it is new and distinctive. Currently, the prior art base consists of information about designs that have been published or used in Australia. Under the new designs system all applications for design registration will be assessed against designs used previously in Australia or published anywhere in the world. Expanding the prior art base means that a design will be compared against more information, thereby increasing the likelihood that the design is both new and distinctive." 49 As mentioned above, the 1906 Act has now been repealed and the Designs Act 2003 (Cth) has come into operation. 50 In Conrol Pty Ltd v Meco McCallum Pty Ltd (1996) 34 IPR 517, an infringement action concerning an alleged obvious or fraudulent imitation of conveyor structures, Lockhart J explained the public policy lying behind the Designs Act at 527: "The Act thus requires that a design must be new or original to qualify for registration. This requirement manifests the parliament's intention to balance or reconcile two competing elements of public policy: first, the encouragement and protection of the intellectual activity which is put into the production of industrial designs; secondly, the concern not to impede or oppress the natural development of industry." 51 Despite early judicial statement along the same lines: see Le May v Welch (1884) 28 Ch D 24, Phillips v Habro Rubber Co (1918) 35 RPC 276 and Re Caron International's Design Application [1981] RPC 179, perceived limitations inherent in the Designs Act for bringing a successful infringement proceeding under the provisions of Pt V were addressed by the amending provisions contained in the Bill. 52 The key deficiencies in the present legislation that these amendments seek to address are captured in the Bills Digest prepared in respect of the Bill; see Commonwealth, Bills Digest No 129, 2002‑2003, Department of the Parliamentary Library, 2003. The author there noted that designs law involves striking a balance between two competing goals. It must be sufficient to facilitate innovation by prohibiting design free riding (which reduces the financial returns to the designer), and it must facilitate innovation by enabling the use of existing designs to create new ones. The author commented that judicial decisions have tended to favour the latter goal and that, as a result, 'a body of designs law has evolved which, it is often argued, does not provide adequate protection against designs free riding…' 53 The relevance of reciting the foregoing is to place in context the limitations in the Designs Act which Parliament evinced an intention to remedy. It is the legislative scheme prior to the Designs Act 2003 (Cth) that throws light upon the issues to be determined in this proceeding.

The law of standing - general principles of analysis 54 It is as well at the outset to recall the statement of McHugh J in Bateman's Bay Local Aboriginal Land Council v The Aboriginal Community Benefit Fund Pty Ltd (1998) 194 CLR 247 ("Bateman's Bay")where his Honour rather aptly observed at 280 that '[t]he doctrine of standing is a house of many rooms'. His Honour was speaking with respect to the issue of standing in relation to public rights where declaratory or injunctive relief is sought. It is an observation of application in the present circumstances. 55 Lockwood noted that there are no reported decisions on the meaning of the term 'person aggrieved' for the purposes of s 39 of the Designs Act and submitted that the term should be liberally construed. 56 Alco submitted that the cases on standing relied on in the proceeding could be categorised into three groups. The first group identified were those cases of the type dealing with public rights which were referred to by McHugh J in Bateman's Bay and which required the identification of a 'special interest'. The second group of cases were those where a person has sought review of an administrative decision. The third group comprised those cases where the administrative decision was the grant of monopoly rights by registration of a design, patent or trademark. 57 The purpose of this categorisation was to place emphasis on the proposition, that found common ground between the parties, that it is the subject, scope and purpose of the statute under which an impugned decision has been made which is of relevance: Allan v Transurban City Link Ltd (2001) 208 CLR 167 at 174 per Gleeson CJ, Gaudron, Gummow, Hayne and Callinan JJ; 184‑185 and 188 per Kirby J. See also Australian Institute of Marine and Power Engineers v Department of Transport (1986) 13 FCR 124 at 131, Alphapharm Pty Ltd v SmithKline Beecham (Australia) Pty Ltd (1994) 49 FCR 250 and Big Country Developments Pty Ltd v Australian Community Pharmacy Authority (1995) 60 FCR 85 at 93. 58 The rationale for this analytical approach was commented on by Lockhart J in Ogle v Strickland (1987) 13 FCR 306 at 311: "It is important not to shackle the interpretation of these expressions [person aggrieved, person interested] by importing concepts from other statutes in which they appear involving different subject matter and objects, especially when the expressions have received judicial interpretation not intended to have general application or, indeed, application beyond the particular words in the particular context of the particular statute concerned." 59 So too, Lockwood relevantly referred to the comments of Kirby J at 181 in Allan v Transurban City Link Ltd (supra). Although his Honour delivered a dissenting opinion, his observations on the question of standing were not in contention: "the …Full Court erred in this case by approaching the problem, as it did, as one in which definitive light would be cast by general observations in this and other courts on the common law rules of standing. Especially because such observations were… written in an earlier time, for a different purpose, with different presuppositions about court proceedings and a different context of public interest litigation, the adoption of such a 'starting point' was likely to mislead… The proper starting point for analysis in this case was thus close attention to the requirements of the legislation in question." 60 Lockwood put the view that although the principles developed by common law are not determinative, they are not irrelevant, and the task is to look first to the relevant statutory context. Despite the common ground between the parties as to the starting point of analysis, it became apparent during the proceeding that there was dispute as to the appropriate emphasis to be given to the principles developed by the common law. 61 It is well settled that in public rights cases the door to the proposition of open standing is firmly closed. This was cogently expressed by Gibbs J (as he then was) in Australian Conservation Foundation Inc v Commonwealth of Australia (1980) 146 CLR 493 at 526: 'It is quite clear that an ordinary member of the public, who has no interest other than that which any member of the public has in upholding the law, has no standing to sue to prevent the violation of a public right or to enforce the performance of a public duty. There is no difference, in this respect, between the making of a declaration and the grant of an injunction.' See also Onus v Alcoa (1981) 149 CLR 27 at 35‑36 per Gibbs CJ, Shop Distributive and Allied Employees Association v Minister for Industrial Affairs (1995) 183 CLR 552 at 557‑558 and Bateman's Bay at 275‑280 per McHugh J. 62 Lockwood submitted that a flexible approach to standing should be taken as the general public had an interest in maintaining the 'purity' of the Register, that is, an interest as a member of the public in not having designs on the Register which are not in truth new or original designs. Lockwood submitted that this interest was not put as an interest coterminous with members of the public, but rather was a concern to address the public mischief of 'bad' designs subsisting on the register and that such a concern supported a liberal construction of the scope of standing under s 39 of the Designs Act. 63 Alco contended that the 'purity' of the Register claim by Lockwood did not satisfy the 'special interest' test discussed in Australian Conservation Foundation Inc v Commonwealth of Australia (supra), and applied in Onus v Alcoa (supra), wherein Gibbs CJ said at 36: 'The rule is obviously a flexible one since, as was pointed out in [Australian Conservation Foundation Inc v Commonwealth of Australia], the question of what is a sufficient interest will vary according to the nature of the subject matter of the litigation.' 64 Alco submitted that, as the instant case is not concerned with violation of a public right, the first group of public interest cases really have little relevance to the determination of Lockwood's standing. 65 There have been a number of decisions where the issue of standing has been analysed in an expansive rather than in a restrictive manner. For example, in Attorney General of the Gambia v N'Jai [1961] AC 617, Lord Denning said at 634: 'The words "person aggrieved" are of wide import and should not be subjected to a restrictive interpretation. They do not include, of course, a mere busybody who is interfering with things which do not concern him: but they do include a person who has a genuine grievance because an order has been made which prejudicially affects his interests.' See also SmithKline Beecham (Australia) Pty Ltd v Chipman [2002] FCA 674 where Weinberg J noted at [103] that the above passage has been cited with approval on many occasions and represents a correct statement of the law. Nevertheless, the expression must be construed by reference to the context in which it appears, namely, the Designs Act. 66 The authorities cited by the parties, and to which reference is made above at [57], clearly support the proposition that the facts supporting a party's standing must be sufficiently directly related to the concerns of the relevant statute. While common law principles on standing provide a useful backdrop against which to approach the analysis, the question here arises in the context of the Designs Act, and it is to that statute that the inquiry must be directed. 67 Of the second group of cases, involving applications for review of an administrative decision, Alco made reference to what was said by Lockhart J (with whom Fisher J agreed) in Ogle v Strickland (supra) in relation to the expression 'person aggrieved' in an application under the Administrative Decisions (Judicial Review) Act 1977 (Cth). His Honour said at 309-310: "It has long been recognised that these formulae for determining standing to sue should not be given a rigid or inflexible meaning. They are flexible words which derive their meaning and take their colour from the context in which they appear and the nature of the particular statute concerned." 68 Lockwood made various submissions in relation to judicial statements made in a number of cases in relation to the second category, including the statement of Gummow J in Australian Institute of Marine and Power Engineers v Department of Transport (supra) at 133 that: "… there flows from the [administrative] decision…a danger and peril to the interests of the applicant that is clear and imminent rather than remote, indirect or fanciful, and the applicant has an interest in the matter of an intensity and degree well above that of an ordinary member of the public." This statement was adopted by the Full Federal Court in Broadbridge v Stammers (1987) 16 FCR 296 at 298. 69 However, there is ample authority to reinforce the view that the relevant inquiry is whether the purposes or ends which Parliament sought to advance by enacting the Designs Act are those with which Lockwood is concerned and is seeking to advance by the process of judicial review: see, for example, North Coast Environment Council Inc v Minister for Resources (1994) 55 FCR 492. Any guidance that may assist the parties in the present case is most likely to be found by reference to the third group of cases identified, those cases where the administrative decision is the grant of monopoly rights by registration of a design, patent or trademark.

Does Lockwood have standing? 70 Lockwood submitted that it has a sufficient interest to satisfy the standing requirement in s 39 of the Designs Act of a 'person aggrieved' by virtue of its commercial interest as a direct competitor of Alco in Alco not being able to use design protection to distinguish its BiLock product and make it more attractive to purchasers than Lockwood's Twin product. Lockwood relied upon the following factors to establish its interest: · The Lockwood Twin range of products in the high security end of the Australian lock market compete directly with Alco's BiLock range of products. Alco's designs in suit protect key blanks which are used to make keys that are part of the BiLock range; · Design protection is considered by purchasers in the high security end of the Australian lock market to be an important aspect of a high security keying system and is used as a critical marketing tool when selling high security keying systems. · Alco emphasises such protection as an aspect of its BiLock keying system and uses the existence and the duration of the registered designs for key blanks as an important point of difference between its BiLock keying system and the Lockwood Twin keying system and as a superior feature to that of Lockwood's product. As such, registration of the designs in suit enables Alco to put Lockwood at a real competitive disadvantage and to divert sales from Lockwood. 71 Lockwood complained that Alco is placing it at a commercial disadvantage because of the marketing strategy Alco has adopted for the designs in suit. That is, it has a 'reasonable apprehension' that the manner in which Alco uses design registration in its marketing will influence customers' purchasing decisions to the detriment of Lockwood. By way of example, Lockwood relied upon certain statements made in a commercially sensitive document dated 30 March 1998 concerning Alco's BiLock system which, Lockwood submitted, was being used by Alco to attempt to target actual or potential Lockwood customers. The document stated that: 'Almost all of the "alleged" restricted keying systems available in Australia today are either no longer restricted or will very soon fall into this category, and are therefore open to unauthorised key duplication.' 72 Lockwood gave many examples to support its complaint about the manner in which design registration is used as part of Alco's aggressive marketing strategy, including a letter to a potential client which stated that: 'The entire basis of the protection offered in today's keying systems is found in the way in which the product itself is legally protected. The way of the future is to head towards a product that has legal protection, in the form of patents, on the keyway and cylinder mechanism, as well as the less regarded design registrations on key blanks. It is also recognised that the legal protection being offered should last for at least ten years (as it is viewed that an overhaul or replacement of the system should be due at this time).' 73 Alco submitted in oral argument that the effect of its design registration on Lockwood was really an indirect or consequential effect on Lockwood's economic interests. Alco contended that, should Lockwood be granted standing based on a commercial interest of this kind, the way would be open for abuse of the registration process. Alco cited the ALRC Report's comments at [11.2] in respect of the registration stage of the process that: 'Opposition proceedings before registration can mean increased costs and delays for the applicant. There is also the possibility of abuse of the procedures by competitors who wish to disrupt a design owner's business.' 74 Alco contended that the aim of Lockwood's design challenge was simply to improve its own general competitive position by restricting Alco's ability to market its products by reference to its registered designs whilst continuing to market its own products in a similar fashion. 75 In support of this claim, reference was made to what was said by Thomas J in Rayjon Properties Pty Ltd v Department of Housing, Local Government and Planning (Qld) [1995] 2 QdR 559. While that case dealt with commercial retail planning issues, his Honour's comments shed light on the general principles which have been found concerning standing in relation to commercial interests. His Honour stated at 562: 'It is true that as a business competitor…which competes for the custom of the public in the same general area, it has a greater interest than the ordinary member of the public in seeing its competitor's application delayed or defeated. That however is not to the point… An interest in hindering a competitor or obtaining a tactical advantage of this kind is not in my view the sort of interest that the law should encourage or protect.' 76 Of course, an economic interest may be sufficient to meet the requirements of standing if an applicant's complaint as a business competitor touches directly on the nature, scope and effect of the legislation under which an impugned decision has been made. To this end, Lockwood relied on what was said by Whitlam J in Loveridge v Pharmacy Restructuring Authority (1995) 39 ALD 103 at 106 that: 'Here the applicants' complaint touches directly on the application of the guidelines made under the Act…they are persons 'aggrieved' by the relevant decisions and entitled to institute this proceeding.' 77 Alco submitted that, in fact, Loveridge v Pharmacy Restructuring Authority (supra) turned on the distinctive facts of that case, where the plaintiff pharmacy had been subjected to competition in a shopping centre where formerly there was none, and did not lend support to any broad proposition that commercial activities in competition with those sought to be restrained would be adequate to found standing. In each case, the question must be considered in the light of the scope and purpose of the particular statute in issue. 78 Alco also submitted that a competitor's interest may more easily suffice to satisfy the standing requirement in a public rights case, than standing for judicial review. Reliance was placed on Lehane J's statement in Boots Company (Australia) Pty Ltd v SmithKline Beecham Healthcare Pty Ltd (1996) 65 FCR 282 at 287-289. 79 It is apparent that the authorities support the proposition that defining the nature of the statute under which an impugned decision has been made is crucial to the resolution of the question of standing in judicial review cases, including those involving commercial or financial interests, and that this is not necessarily so in the public rights cases. This is not to say however that there is no overlap between the questions and considerations in the two categories of cases. 80 It is to be recalled that the scope of the registration scheme under the Designs Act is narrow in the sense that design protection is for one particular individual and specific appearance applied to the article the subject of registration, in respect of which flows a monopoly right of limited duration of 16 years in total. It is also to be recalled that it was common ground that Lockwood's and Alco's respective high security locking products are not identical, and have significantly different features that distinguish them from each other in the marketplace. 81 Lockwood submitted, in reliance on the interpretations of cognate terms in other Commonwealth industrial property legislation, that the expression 'person aggrieved' should be construed liberally. Particular reference was made to decisions concerning applications to rectify the register established under the Trade Marks Act 1955 (Cth), and later, the Trade Marks Act 1995 (Cth) (collectively "the Trade Marks Act"): see Re Powell's Trade Mark (1894) 11 RPC 4; The Ritz Hotel Ltd v Charles of The Ritz Ltd (1988) 12 IPR 417; Kraft Foods Inc v Gaines Pet Foods Corporation (1996) 65 FCR 104. The cases there cited support what McClelland J held at454 in The Ritz Hotel Ltd v Charles of The Ritz Ltd (supra): '…the expression [person aggrieved] would embrace any person having a real interest in having the register rectified, or the trade mark removed in respect of any goods, as the case may be, in the manner claimed, and thus would include any person who would be, or in respect of whom there is a reasonable possibility of his being, appreciably disadvantaged in a legal or practical sense by the register remaining unrectified...' 82 Alco submitted that the Designs Act may be distinguished from the Patents Act 1990 (Cth) ("Patents Act") on the basis that it is not concerned with the broader concept of manner of manufacture; and from the Trade Marks Actas it is not concerned with policy matters such as protection of the public from deception or confusion. On this latter point, it is salient to note that in Campomar v Nike International (2000) 202 CLR 45 the High Court said at 71: '[I]n varying ways and to varying degrees, [the Trade Marks Act], by its express provisions, established and sanctioned a system the operation of which involved a measure of likely deception or confusion. The construction of s 28 should be approached with this in mind and not from a vantage point which abhors the prospect of any such deception or confusion.' 83 Whilst Alco conceded in its written submissions that interference with a monopoly grant under the Designs Act characterised as an 'appreciable practical disadvantage' may suffice to ground standing, this would only be 'so long as it is directly connected to the scope of the monopoly grant.' Reference was made to the statement of Lloyd‑Jacob J sitting on the United Kingdom Patents Appeal Tribunal in Re Benjamin Israelachvilis' Application (1955) 72 RPC 1. That case related to an application to impugn a decision of the Comptroller‑General, who had granted standing to the respondent, in an application to cancel a registered design. This was done on the basis of the respondent's interest as an exporter of goods from Milan to Nigeria, in which country the proprietor of the registered design was said to enjoy monopoly rights by reason of an ordinance, Ch 221 of the Laws of Nigeria. His Honour held at 2 that the ordinance could not alter the monopoly rights to extend them beyond the United Kingdom, as the ordinance 'proceeds not from any act of the United Kingdom registration granting authority'. As interesting as this sole case on standing in a design context may be, it fails to shed any light on the issues in this proceeding. 84 Alco then submitted, by analogy with the Patents Act, that standing to oppose the grant of a patent, following earlier English authority, required the impact of the interference with a monopoly right to be 'real, definite and substantial': see Lufft v Weiss (1946) 73 CLR 119 per Latham CJ at 123; per Dixon J at 126‑128. In this category of cases was added the trademarks case of Woolly Bull Enterprises Pty Ltd v Reynolds (2001) 107 FCR 166. There Drummond J said at 169: 'It would be contrary to… the [Trade Marks Act] to accord standing to a person to attack a registered mark on the ground that the person had made his own application for registration of a conflicting mark where there was no proof that the person either had a trade in goods marked with the mark the subject of his registration application or had a bona fide intention to trade in such goods. Such a person cannot be said to be "appreciably disadvantaged in a legal or practical sense"…' 85 Of these latter cases dealing with other Commonwealth industrial property legislation it may be noted, as was generally submitted by Lockwood, that recourse to other decisions dedicated to different legislation and fundamentally different facts is of limited utility. 86 It is common ground between the parties that what is at issue here is the effect of the promotion and marketing of patent or design registration on purchasing decisions in high security keying systems. Lockwood conceded that a failure to make the 'special interest' test of the type recognised in public interest cases would be fatal to its claim. It submitted that the species of interest that it has, being 'apprehended or actual injury or harm to its commercial or business or economic interests,' was sufficient to meet that test. 87 However, putting any alleged breach of s 52 of the Trade Practice Act aside, the manner in which either Lockwood or Alco chooses to promote the 'legal protection' (the rubric used in references to patent or design protection in advertising brochures) afforded to its products, would seem to be a marketing prerogative. The exploitation of a marketing edge - here said to manifest in longevity of such protection for one product as compared to another - would seem to be an efficacious emphasis on the monopoly rights that the Designs Act promotes. 88 Of course, if those rights were not legally acquired - in the sense that the designs in suit were said not to be sufficiently 'new or original' or, to use the language of s 28, had previously been published in the Commonwealth - it would throw a different light on Lockwood's complaints. However, infringement proceedings were not brought against Alco, nor by Alco against Lockwood. It was conceded that this was because there was no basis upon which either party could ground such an action. It is noted in passing that the legislation specifically provides for a remedy where the scope of the monopoly grant is at issue. Here, no such complaint is made. 89 In light of the foregoing, if the ground upon which Lockwood sought to have the designs in suit expunged from the Register was because they do not meet the criteria set out in s 17 of the Designs Act, then this would clearly be a basis for standing. As earlier mentioned, in the course of oral argument counsel for Lockwood made a brief reference to the contention that Alco's designs were not novel. Lockwood was referring to s 17 of the Designs Act, contained in Pt IV, which sets out the criteria for registration, namely that registration shall only apply to a design that is 'new or original'. A design is not new or original where design details or features differ from an existing design 'only in immaterial details' or are 'an obvious adaptation' thereof: s 17(1) of the Designs Act. It would seem that a complaint as to loss of sales and ability to maintain an existing market that is connected with the attack on the lack of innovation in the designs in suit would satisfy the requirements of an 'aggrieved' party. This is because in this context, such a complaint would be consistent with the scope and purpose of the Designs Act. 90 However, Lockwood seeks to expunge from the Register the designs in suit, not because they are not sufficiently 'new or original,' but rather because their continued existence 'permits or arms' Alco with the ability to continue to use the fact of registration in the way it does. It may well be that Lockwood is aggrieved by this competition. As the High Court observed, while speaking about the law of torts, in Campomar v Nike International (supra) at 54 'as a general proposition, the law of torts values competitive conduct between traders to keep down prices and improve products'. However, without more than the complaint that has been made, there is not a sufficient basis upon which to accede to Lockwood's claim that it is a person aggrieved within the meaning of s 39 of the Designs Act. The Designs Act promotes the commercialisation of innovation. It permits a design owner to use registration as a marketing edge. 91 Both questions are answered in the negative.

I certify that the preceding ninety-one (91) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Goldberg.

Associate: Dated: 8 March 2005 Counsel for the Applicant: Bruce Caine S.C. and Helen Rofe

Solicitor for the Applicant: Phillips Ormonde & Fitzpatrick

Counsel for the Respondent: Ross Macaw QC and Mark Goldblatt