Federal Court of Appeal Clarifies Industrial Design Protection of Functional Features

On May 4, 2015, the Canadian Federal Court of Appeal (FCA) released its decision in Zero Spill Systems Inc v Heide, 2015 FCA 115. This decision set aside several findings of the Federal Court decision under appeal (2013 FC 616) and clarified that a functional feature of a design may be protectable under the Industrial Design Act (the Act), as long as the feature’s form is not dictated solely by function. The FCA therefore allowed the appeal in part and remitted several issues back to the Federal Court for determination.

Background

Zero Spill Systems (Int’l) Inc, along with the other appellants, (collectively referred to as Zero Spill) sued Bill Heide dba Central Alberta Plastic Products, Rat Plastic Ltd and 1284897 Alberta Ltd (Lea-Der) (collectively the Respondents) for infringing various Canadian patents and Canadian Industrial Design 86,793 (the ‘793 Design), relating to a fluid containment apparatus for use in oil field operations.

Federal Court Decision

The Federal Court dismissed the infringement action, holding that the Respondents had not infringed any of the asserted patents or the ‘793 Design. Notably, the Federal Court decision was taken to hold that because many of the features of the ‘793 Design were in some way functional, they were not protectable under the Act by virtue of subsection. 5.1(a).

Appeal

Zero Spill appealed the Federal Court decision, arguing with respect to the ‘793 Design that (1) the burden was on the Respondents to show that subsection 5.1(a) of the Act applied, and that this burden had not been satisfied by the Respondents, and (2) subsection 5.1(a) excludes only features whose form is dictated solely by their function, but not features that have some coincident function.

The FCA held that subsection 7(3) of the Act creates a blanket presumption of compliance with the entire Act, which therefore places the burden to rebut the presumption of compliance on the Respondents. Since the Respondents led no evidence to rebut this presumption, it followed that the Federal Court finding of non-infringement based solely on subsection 5.1(a) could not stand.

The FCA also considered the Federal Court’s finding that all features of an industrial design that are functional are not protectable by virtue of subsection 5.1(a) even though those features might also have aesthetic characteristics. Based on a plain reading of the Act, as well as a contextual understanding of the purpose of the Act, the FCA held that “functional features of designs may be protectable under the Act. Only those features whose form are dictated solely by function are not protected.”

Therefore, the Federal Court’s holding that the Respondents had not infringed the ‘793 Design was overturned and was remitted back to the Federal Court for redetermination.

The FCA also considered the findings with respect to the infringement and validity of three Canadian patents licensed by Zero Spill. The FCA held that, with respect to patent numbers 2,258,064 and 2,166,265, the Federal Court erred in failing to completely construe the claims. Therefore, the FCA remitted the determination of the validity of these patents to the Federal Court.