Another twist in the bizarre Crocs EUIPO litigation concerning the design of the legendarily ugly plastic clogs, which began on 31 July 2006 and looks still to be running.  The author has to declare an interest, having been involved in the proceedings around that date (though not since) on the other side from Crocs.

Longstanding readers of this blog will perhaps recall that on 12/12/2007, by Decision ICD 3010, EUIPO’s Invalidity Division found the Crocs design RCD 257001-0001 invalid over prior art consisting largely of related disclosures, including pre-filing disclosures by Crocs (or, as they then were, Western Brands) themselves on their website and at an International Boat Show in Florida.  A further party then entered the fray - Partenaire Hospitalier International, a defendant in an action brought by Crocs.

Crocs appealed, but got no better luck at EUIPO’s Boards of Appeal, where on 26/03/2010 the invalidity was upheld in Decision R0009/2008-3.  They then appealed once more, to the General Court.

At this point Holey Soles, the applicant for invalidity, went bankrupt.  By an Order of 23 November 2012 in Case T-302/10, the General Court noted that the invalidity application had been withdrawn and therefore closed the appeal, finding that “the present action has become devoid of purpose. There is therefore no longer any need to adjudicate on the action”. 

Surprisingly, perhaps, given that two instances of EUIPO had found the design invalid, it now came back to life without the Court having found any error by EUIPO.  And it might have stayed that way if a new party, Gifi Diffusion, had not brought new invalidation proceedings under case number ICD 9066 in March of 2013.  In this second case, however, the Invalidity Division found the Crocs design to be valid.  It found itself not to be bound by the earlier EUIPO decisions (even though the facts pleaded were the same) and held that the applicant for invalidity had supplied insufficient proof.

Matters were different before the Board of Appeal, where Gifi had taken the trouble to inspect the file of the earlier proceedings and produce clearer photocopies of the evidence.  By its decision of 6 June 2016 in case R0853/2014-3, the Board came to essentially the same conclusions as it had previously, namely that the disclosures at the boat show and on the internet made the design available to the public.

And so, once more, the case reached the General Court, which issued its judgment on 14^th March as Case T‑651/16.  During the pendency of the General Court appeal, the US Patent Trial and Appeal Board had upheld the invalidation on re-examination of Crocs’ corresponding US design patent D517789, though it seems that this decision is on appeal and therefore not final.  However, Gifi relied on a document from the US proceedings relating to the priority claimed by Crocs – an interesting issue left undecided thus far in Europe, in that the European design claimed priority from the US design patent application which itself claimed priority from an earlier US utility patent filing and so was perhaps not a “first” application in Paris Convention terms.  The General Court accepted the late-filed document.

The General Court judgment deals with burden of proof of disclosures – not a new issue at General Court level, but perhaps an interesting one for the Court of Justice.  Both sides agreed that the prior disclosures had occurred, but Crocs complained that the job of proving that the disclosure would not have come to the attention of the sector concerned in the EU amounted to proving a negative, and should not fall on them – instead the applicant for invalidation should prove that at least one European had become aware of the design. 

There is perhaps some force in the point, but in keeping with the limited nature of the exclusion from disclosure, the Court held that

“… the applicant is right in arguing that it cannot be expected to prove a negative fact. However, far from being required to prove negative facts, the applicant could have adduced positive proof relating, in the present case, for instance, to data showing that, notwithstanding the fact that its website was accessible worldwide, there was no, or very little, actual traffic from users originating in the European Union, or that the Fort Lauderdale Boat Show had not been attended by exhibitors or participants from the European Union , or also that the distribution and retail network for the clogs to which the contested design had been applied was not actually operational and that no order had been placed using that network.”

So far, all is in accordance with the state of the law in the EU.  However, the General Court appear to have made an unholy error in relation to priority and the effect of the one year grace period against Crocs’ own disclosures. 

The controversy arose because Crocs appear (and this part of the judgment is obscure) to have argued that the loss of the priority in the US from the earlier utility patent confirmed the validity of the European claim to priority from the design patent application, which was thus a “first” application.  However, the priority point had not thus far been an issue in the case – all parties and EUIPO had been treating the priority claim as valid.

The General Court held that:

“…the fact remains, on any view, that Article 7(2)(b) of Regulation No 6/2002 envisages two separate starting points for the relevant period, namely either the date of filing of the application for registration or the date of priority. In the present case, given that the disclosure events occurred in any event prior to the 12-month period preceding the filing of the application for registration of the contested design with EUIPO within the meaning of Article 7(2)(b) of the regulation, namely on 22 November 2004, the USPTO document is irrelevant to the outcome of the present dispute.”

In other words, referring to disclosures before the filing OR priority dates allows the Court to apply either one, at its option.  But, of course, if that were true, then it would only ever be necessary to consider the filing date since the priority date is by definition earlier.  The Court’s approach would make priority claims irrelevant which is certainly not what the legislator intended.

The likely explanation is that they intended to say “…the disclosure events occurred in any event prior to the 12-month period preceding the filing of the application for registration of the contested design with EUIPO USPTO within the meaning of Article 7(2)(b) of the regulation, namely on 22 November28th May 2004,”.  The alternative is too clearly perverse to contemplate.

In the meantime, Crocs have continued to litigate in Europe and the US as before, pending a final judgment.  Who would have thought that the litigation, and indeed the product, would have had so much life in it?