The Unfair Competition Law establishes the possibility of taking action against copying or imitation in specific circumstances, namely, when the creations are covered by an exclusive right, when there is risk of association, or if they would be taking unfair advantage of a third party’s reputation or efforts, when this is avoidable.
These days, when everything seems to have been invented, many businesses are starting to apply the well-known dictum: reinvent yourself or perish. However, what happens if, in order to achieve this aim, they turn their attention to the external appearance of the most iconic goods owned by their competitors, and begin making their own versions of the most striking features of those goods, launching them on the market as their own? Are the victims of imitations who have failed to register their designs totally unprotected, or can they resort to legal means to contest this type of conduct?
As will be seen, aside from the protection granted by community designs, registered or not, in some circumstances unfair competition regulations may apply, in particular, article 11 of the law which regulates acts of imitation.
We say “in some circumstances” because Unfair Competition Law 3/1991, of January 10, 1991 (LCD), rather than prohibiting this practice, tends to encourage it, establishing as a general rule that copying third party business services and initiatives is free. Notwithstanding, this “principle of free imitation” is not absolute, and it has its limitations: (i) in cases in which creations are covered by an exclusive right and (ii) conduct that creates a risk of association in relation to the business origin, or involves misuse of a third party’s reputation or efforts, provided that this is avoidable.
Based on the premise that, as a general rule, imitation is not a bad thing, and nor is it prohibited, we propose to analyze the requirements for protecting a form that is not covered by an exclusive right, according to the LCD.
- Existence of an imitation (copy of an essential element): the imitated goods should have a competitive singularity and should be sufficiently established in the market. It is necessary to prove that the original product (i) has elements that differentiate it from all the other goods of its kind and (ii) enjoys the requisite degree of penetration in the market (advertising investment, commercial success, dissemination, market share etc.). That is, it is necessary to prove that a product already on the market has not been imitated, and that the product in question, in its field, has its own distinguishing features that set it apart from the rest.In practice, we find cases in which it has been declared that industrial goods, such as garden sprayers (judgment no. 114/2009 of the Provincial Appellate Court of Madrid, Section 28, of May 8, 2009) or fitness apparatus (judgment no. 546/2012 of the Community Trademark Court of 28 December 2012) enjoy a competitive edge, as they have features that differentiate them sufficiently from other items of the same kind.However, it has also been considered that goods which might well be better known by their target public, such as Longchamp’s Le Pliage bag (judgment no. 52/2012 of the Provincial Appellate Court of Barcelona, Section 15, of February 10, 2012) or the Pandora bracelet, (judgment no. 209/2011 of the Provincial Appellate Court of Barcelona, Section 15, of May 2, 2011), lack that specific competitive edge. In the first case, due to lack of proof, although years later it was recognized as a work protected by intellectual property, (judgment no. 401/2017 of the Provincial Appellate Court of Madrid, Section 28, of September 15, 2017), and in the second, due to the existence of numerous competitors marketing this type of bracelet which led the Provincial court to conclude that this type of design “is not something exclusive to Pandora”.
- Risk of association or misuse of a third party’s reputation or efforts. In this case, it is required (i) that the imitation would be more than likely to produce an erroneous belief in the target consumer that the imitation comes from the same business source as the original (or from legally or financially related businesses) or (ii) that the imitator is taking advantage of the reputation earned through the fame and prestige of the original product or the pioneering efforts of a third party for their own benefit (for example, using technical means that permit the original to be replicated at low cost and preventing the imitated entrepreneur from recovering production costs.)
- Avoidance of this type of conduct. Finally, it is necessary to prove that the similarity between the goods could have been avoided, for example, if it were not imposed by functional needs, and was not essential for manufacturing the goods, given that the competitors had a wide range of variation and creativity (within the bounds of what is commercially reasonable in the light of market trends) etc. In short, this is a question of not punishing those cases where imitation is inevitable.
To conclude, if we are able to prove the existence of these three requirements (this may be an arduous task, depending on the circumstances) we can take action against third parties who unfairly imitate our goods, even when we have not registered their external appearance as an industrial design. And conversely, if we intend to launch a product on the market inspired by others already in existence, it would be necessary to assess the associated risks with an expert, in order to determine whether or not we would be crossing that fine line into the realm of overriding the principle of free imitation of third party business services and initiatives.
Garrigues Intellectual Property Department