Swimwear manufacturer’s use of prior copyright works for “inspiration” steps over the line into infringement.

Co-authored by Peter Heerey AM QC, Tom Cordiner & Alan Nash
Correspondents for South Australia, Victoria and Western Australia

Note: Where any of the barristers were involved in a case reported below and the matter is still running, or potentially so, the other correspondents have taken the role of reporting that case.

Seafolly Pty Ltd v Fewstone Pty Ltd [2014] FCA 321

This was a claim of copyright infringement brought by Seafolly in respect of three artistic works printed on fabric used to manufacture various of Seafolly’s swimwear and beachwear.  It alleged that certain artwork of a similar nature used by the respondent (trading as City Beach) on its products reproduced a substantial part of those works and that reproduction was not the result of independent creation.

The first two of the works in suits were floral designs, and the corresponding alleged infringing artwork were thematically similar but not exact copies.   City Beach conceded, however, that it used Seafolly products bearing the works in suit as “inspiration” to create the alleged infringing works.  The evidence revealed various communications between City Beach and a contracted design company that included images of Seafolly’s products for use as “inspiration” and instructions that City Beach wanted something “similar” or with the same “look and feel”.  In respect of one of the floral works, the design company described an early draft of the corresponding City Beach design as a “Seafolly knock off” and raised the possibility of Seafolly reacting (presumably in the manner in which it did).  The design company was instructed to make changes to that design to distance it from the Seafolly work, but some of those changes were later reversed at City Beach’s behest.

City Beach denied infringement on the basis that there was no sufficient objective similarity between the two sets of works.  City Beach also asserted that Seafolly’s works “appeared from a crowded field of prior art” and were not original so far as the works were reproduced by City Beach’s artworks, such that no substantial part had been taken.  Further, City Beach submitted that any originality of the Seafolly works was limited to their collocation of features which, individually, were unoriginal, commonplace and derived from the “prior art” to which the fashion industry, including Seafolly, looked for inspiration; any individual elements in the Seafolly works were unoriginal and hence unprotected.   Putting the same considerations another way, City Beach argued that at best it had taken the (unprotectable) idea of the works in suit, not their form of expression.

City Beach also submitted (perhaps ambitiously) that infringement of an artistic work required an exact or faithful reproduction of a substantial part of the artistic work, because the exclusive rights comprised in copyright in an artistic work do not include the right of adaptation (unlike literary, dramatic and musical works).  Justice Dodds-Streeton rejected that argument, noting that it was contrary to well-established principles and would unduly narrow copyright in artistic works.

The third work in suit was an embroidery design of alternating and adjoining large and small diamonds.  The evidence was that City Beach’s Chinese clothing developer was instructed to use that same pattern for City Beach’s product.  In addition to the arguments referred to above, City Beach denied infringement of that work on the basis that the embroidery applied to Seafolly’s products was a corresponding design within the meaning of s 74 of the Copyright Act.

Justice Dodds-Streeton held that each of the three Seafolly works had been infringed by City Beach reproducing a substantial part of the works or authorising the same.  Her Honour noted that a substantial part can be a “feature or combination of features abstracted from the work”.  Her Honour discerned an objective similarity in each case, and in the case of the embroidery patterns these were “manifestly similar”.  In the case of the floral prints her Honour held that the elements and combination cumulatively comprised a qualitatively and quantitatively substantial part of those works.  Her Honour also was not persuaded that those elements were commonplace or derived from other works.  In contrast, for one of the works City Beach had intended to make use of Seafolly’s works and was aware of the risk of infringement but “did not hesitate to cross that line”.

In relation to Seafolly’s embroidery pattern, her Honour found that there was no relevant corresponding design once it was applied to a garment.  The features of “shape and configuration” were not “embodied” in the garment in the requisite sense.  There was also some doubt as to whether such a pattern could be said to be three dimensional.

Her Honour ordered that City Beach pay $80,333 in damages for lost profits, a further $20,000 in compensatory damages for damage to Seafolly’s reputation and $150,000 in additional damages.

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