Imitation Marketing

In a recent judgement the Austrian Supreme Court had to decide a case on knives which were protected as registered Community Designs. These knives were sold in sets consisting of 11 knives, whereas the knives were packed in two layers of 5 and respectively 6 knives such that when the cover of the package was taken away all of the handles of the knives could be seen. The infringement of the registered Community Design was a clear-cut case and was not even appealed to the Supreme Court by the defendant.

The interesting aspect of this decision is that the Austrian Supreme Court had to apply Section 2 para. 3 (1) of the amended Law against Unfair Competition (LUC) for the first time which corresponds to Art. 6 para. 2 lit. a of the Unfair Commercial Practices Directive.

First of all, the Supreme Court decided that point 13 of the annex of the Unfair Commercial Practices Directive is not applicable to the present case, as the claimant asked for a court order prohibiting the defendant generally to offer and/or sale the knives in the package in suit. As point 13 of the annex is only directed to the promotion of a product, the court order goes beyond what is mentioned in point 13 of the annex; accordingly the annex is not applicable.

However, according to the Supreme Court Art. 6 para. 2 lit. a of the Unfair Commercial Practices Directive generally applies to so-called 'imitation marketing' whereas marketing includes all acts which are useful for the promotion of sales. Everything which helps the consumer to identify the products of an undertaking is useful for promoting sales. Accordingly also the features of a package might act as distinguishing features. If confusion between two packages is created such an imitation might qualify as imitation marketing.

For any confusion a distinctive character of the original is a prerequisite. As in the present case, the Supreme Court concluded that the package had a distinctive character due to its two layers and the special arrangement of the knives in the package, the Supreme Court found that the claimant could successfully rely on 'imitation marketing' which has its basis in the Unfair Commercial Practices Directive.

Interestingly, the Supreme Court explicitly stated that - as opposed to Section 9 LUC which generally covers protection of trade dresses - imitation marketing does not require any proof of distinctiveness through use. This differentiation seems to widely open the door for the application of 'imitation marketing' and will most likely lead to a displacement of claims being based on Section 9 LUC to a great extent.

Dr. Rainer Beetz, LL.M.