FEDERAL COURT OF AUSTRALIA Muscat v Le [2003] FCA 1540 COPYRIGHT – infringement – garments – design drawing – dressmaking pattern – whether copied – inference from similarities – reproduction – three-dimensional reproduction – prototype garment – artistic craftsmanship – defence to infringement – design applied industrially – plan to plan copying Copyright Act 1968 (Cth) ss 10(1), 14, 21(3)(a), 74, 77(1), 77(2), 77(3) Copyright Act 1911 (UK) Copyright Regulations 1969 reg 17(1)(a) Designs Act 1906 (Cth) s 4 Designs (Consequential Amendments) Bill 2002 (Cth) Designs Regulations 1982 reg 11 Fair Trading Act (Vic) s 9 Amalgamated Mining Services Pty Ltd v Warman International Ltd (1992) 24 IPR 461 followed Burke and Margot Burke, Limited v Spicers Dress Designs [1936] Ch 400 referred to Compagnie Industrielle de Precontrainte et D'Equipment des Constructions SA v First Melbourne Securities Pty Ltd (1999) 44 IPR 512 followed Coogi Australia Pty Ltd v Hysport International Pty Ltd (1998) 86 FCR 154 referred to Cuisenaire v Reed [1963] VR 719 referred to Dalgety Australia Operations Ltd v FF Seeley Nominees Pty Ltd (1985) 5 IPR 97 followed Dr Martens Australia Pty Ltd v Rivers (Australia) Pty Ltd (1999) 95 FCR 136 cited Eagle Homes Pty Ltd v Austec Homes Pty Ltd (1999) 87 FCR 415 followed Edwards Hot Water Systems v S W Hart & Co Pty Ltd (1983) 1 IPR 228 cited Francis Day & Hunter Ltd. v Bron [1963] Ch 587 followed George Hensher Ltd. v Restawile Upholstery (Lancs.) Ltd. [1976] AC 64 applied Greenfield Products Pty Ltd v Rover Scott Bonnar Ltd (1990) 17 IPR 417 cited Guild v Eskandar Limited [2001] FSR 645 applied Hosokawa Micron International Inc v Fortune (1990) 26 FCR 393 cited J. Bernstein Ltd. v Sydney Murray Ltd [1981] RPC 303, 329 cited Kevlacat Pty Ltd v Trailcraft Marine Pty Ltd (1987) 11 IPR 77 cited King Features Syndicate, Incorporated v O. and M. Kleeman, Limited [1941] AC 417 referred to Klarman (H.) Ld v Henshaw Linen Supplies [1960] RPC 150 cited Koninklijke Philips Electronics NV v Remington Products Australia Pty Ltd (2000) 100 FCR 90 cited Ladbroke (Football) Ltd. v William Hill (Football) Ltd. [1964] 1 WLR 273 followed Lerose Limited v Hawick Jersey International Limited [1974] RPC 42 cited Merlet v Mothercare plc (1984) 2 IPR 456 disapproved Pacific Gaming Pty Ltd v Aristocrat Leisure Industries Pty Ltd (2001) 116 FCR 448 cited Parkdale Customs Build Furniture Proprietary Limited v Puxu Proprietary Limited (1982) 149 CLR 191 applied Radley Gowns Ltd. v Costas Spyrou (trading as "Touch of Class" and "Fiesta Girl") [1975] FSPLR 455 cited Regina v Registered Designs Appeal Tribunal; Ex parte Ford Motor Co. Ltd. [1995] 1 WLR 18 followed S. W. Hart & Co. Proprietary Limited v Edwards Hot Water Systems (1985) 159 CLR 466 referred to Sifam Electrical Instrument Company Limited v Sangamo Weston Limited [1973] RPC 899 followed Shacklady v Atkins (1994) 30 IPR 387 followed Thornton Hall Manufacturing Ltd v Shanton Apparel Ltd (No 2) [1989] 1 NZLR 239 cited University of London Press, Limited v University Tutorial Press, Limited [1916] 2 Ch 601 disapproved Wrangler Apparel Corp v Classic Boots Australia Pty Ltd (1997) 38 IPR 19 doubted Australian Law Reform Commission, Designs, Report No 74 (1995) Laddie, Prescott and Vittoria, The Modern Law of Copyright and Designs, (2nd ed, 1995), vol 1 THERESA MUSCAT v QUANG TIEN LE, MYCHI TAT, DUNG TIEN LE, DAT-TIEN LE and LOAN LE V 549 of 2002 THERESA MUSCAT v DAT-TIEN LE and LOAN LE V 882 of 2002 FINKELSTEIN J 19 DECEMBER 2003 MELBOURNE IN THE FEDERAL COURT OF AUSTRALIA VICTORIA DISTRICT REGISTRY BETWEEN: V 549 of 2002 THERESA MUSCAT Applicant V 882 of 2002 THERESA MUSCAT Applicant AND: V 549 of 2002 QUANG TIEN LE, MYCHI TAT, DUNG TIEN LE, DAT-TIEN LE and LOAN LE Respondents V 882 of 2002 DAT-TIEN LE and LOAN LE Respondents JUDGE: FINKELSTEIN J DATE: 19 DECEMBER 2003 PLACE: MELBOURNE REASONS FOR JUDGMENT 1 Fashion is a multi-billion dollar industry that has no national boundaries. The segment of the market that caters to the young is extremely lucrative. Fashion designers are creative people; they want their clothing to be distinctive and appealing. If a design proves successful competitors will copy it to avoid falling behind. The reaction has been for designers to turn to copyright law for protection. The protection they find is both limited and in a state of transition. One difficulty is the inappropriateness of copyright for the protection of designs which have been exploited commercially. The philosophy which has taken hold is that designs legislation is the most appropriate regime to protect designs which have been put to commercial use. It is founded on the belief that the more limited protection afforded by this regime will strike a proper balance between the rights of those with creative ability and competitive manufacturing and trade. This case tests that belief. 2 Ms Muscat, the applicant in two actions which were heard together, is a fashion designer and sole trader of women's clothing. Her clothing is aimed at fashion conscious females in their teens. In particular she designs clothes aimed at the "nightclub scene". She initially ran a retail outlet at the Sportsgirl Centre in Collins Street, Melbourne but now operates a store from Chapel Street, Prahran, an area renowned for its fashion stores. Ms Muscat's label is "Mytiko". It is a label that became popular primarily because other designers did not target the section of the market to which her clothing is directed. 3 Among the most popular garments in the Mytiko range is a tight fitting pant with a low v-shaped waist band and a bootleg or flared leg made from a stretch fabric. This style was created in 1996. At that time most pants had a high waist with a standard circular waistband. The style was innovative because a flared leg ceased to be fashionable in the late 1960s. Initially the Mytiko pants were made from a lycra fabric. In February 2001 the fabric was changed to a thinner rib fabric known as baby ottoman. 4 The Mytiko pants were manufactured according to standard fashion production techniques. First, Ms Muscat incorporated the design of the Mytiko pants in a sketch. The sketch (or design drawing as I shall call it) was then given to a patternmaker, Ms M Greco, who made a dressmaking pattern. Ms Muscat used the dressmaking pattern (which comprised five components - two front panels, two back panels and a waistband) to make a prototype or first sample garment. She then experimented with different stretch fabrics to determine which should be used. Slight variations to the design were effected to accommodate the properties of the chosen fabric. In due course Ms Greco was instructed to change the dressmaking pattern to incorporate the variations. When the new pattern was completed Ms Muscat made a second prototype garment. She was satisfied with what she had created. 5 The dressmaking pattern was then sent to a contract patternmaker to make graded dressmaking patterns. Patterns must provide for different garment sizes; grading is the method by which the dressmaking pattern is both increased and decreased so as to produce a complete size range. The graded patterns were then scanned into a computer for the production of scanned patterns or marker sheets. A marker sheet is the cutting guide or pattern layout made on a sheet of lightweight paper. The purpose of the marker is three-fold: to make a layout for the cutter to follow; to place pattern pieces close together to avoid fabric waste; and to accommodate the cutting order to ensure that the correct quantities of each size are cut. The fabric is then cut according to the pattern. Usually a number of pieces of fabric are spread on a table. A spreading machine that holds the fabric moves back and forth over the length required for the marker, unrolling layer upon layer of smooth straight fabric. The paper marker is then placed on the top, ready for cutting. The marker sheet guides the cutter who cuts the fabric with the blade of the cutting machine. Machinists then sew the parts together. 6 Ms Muscat claims that she is the creator and owner of the copyright in the design drawing and the two sample garments and the owner by assignment of the copyright in the cardboard dressmaking pattern made by Ms Greco as well as the graded dressmaking patterns and the scanned patterns. (I will refer to those works as "the copyright material"). Ms Muscat says that each is an original artistic work, save for the sample garments, which she claims, are works of artistic craftsmanship. The importance of this distinction will soon become evident. 7 The respondents, Dat-Tien (David) Le and Loan (Lisa) Le, are brother and sister. They operate a number of fashion retail outlets at the Southland, Gladstone Park and Highpoint Shopping Centres in Melbourne. The respondents trade under the name "Dolly Girl". Most of the respondents' stock is purchased from Australian suppliers; a small proportion is also designed and manufactured by David with the help of family members. 8 In mid 2002 Ms Muscat discovered that the respondents were selling pants that were tight fitting, flared and incorporated a low v-shaped waist (referred to as "the Dolly Girl pants"). She believed that these pants were copied from her design. On Friday 9 August 2002, Ms Muscat's solicitor wrote to the respondents demanding, among other things, that they cease selling the Dolly Girl pants and deliver up their unsold stock. Although the letter was delivered later that day to the Gladstone Park Store, Mr Le did not read it until the following day. Mr Le said that he did not understand the letter and that "he had no idea what MYTIKO was". However, on Monday 12 August 2002, he and his sister met with lawyers to discuss the letter. Following the meeting Mr Le decided to stop selling the Dolly Girl pants. He immediately instructed his staff to remove the Dolly Girl pants from sale and place them in the storeroom of each store. The next morning Mr Le left on a seventeen day business trip to Hong Kong and Vietnam. Mr Le says that he returned to Australia with pants allegedly purchased in Hong Kong. These pants are similar to the v-shaped Mytiko pants save for one feature: the line of the "v" continued to form a cross. (The pants have been referred to as the "cross-over" or "Le Girl" pants). 9 Although the respondents had withdrawn the Dolly Girl pants from sale, on 23 August 2002 Ms Muscat commenced an action alleging that by the sale of these pants the respondents had (1) infringed her copyright in the copyright material; (2) infringed her trademark for the word "MYTIKO"; (3) engaged in misleading conduct contrary to s 9 of the Fair Trading Act 1999 (Vic); and (4) committed the tort of passing off. The action, which may for convenience be referred to as the first action, was settled on 25 October 2002. In written terms of settlement the respondents undertook to: "… cease and forever refrain: (a) from reproducing, or substantially reproducing, [among other things] the Artistic and Literary Copyright Materials … or authorising such conduct; (b) from manufacturing, importing for sale, selling, or by way of trade, offering and/or exposing for sale, or exhibiting in public in any colour [the Dolly Girl garments]." They also agreed to pay Ms Muscat $16,000 by four equal instalments with the last payment to be made on 25 February 2003. The action was then "struck out … with a right of reinstatement". 10 The respondents commenced selling the cross-over pants when Mr Le returned to Australia. Ms Muscat soon learnt of these sales. Ms Ingram, who is employed as Ms Muscat's production manager, said that she went to both the Southland and Gladstone Park Shopping Centre stores on 29 November 2002 and purchased a pair of cross-over pants at each store. Ms Muscat's sister, Rachel, said that she went to the Highpoint Shopping Centre on the same day and purchased a pair. This evidence is not in dispute. What is in dispute is their further evidence that they also purchased a pair of Dolly Girl pants at each store. According to the respondents the Dolly Girl pants had not been sold since 12 August 2002 when they were removed from the shop floor. The respondents' evidence is supported by a number of young sales assistants who recall the Dolly Girl pants being removed and say that they were not put back on the market. 11 Ms Muscat took a number of steps when she learnt of these sales. First she applied to reinstate the first action, and in that action seeks (1) to recover judgment for $8,000 in accordance with the "liquidated damages" clause in the terms of settlement; (2) a permanent injunction restraining the respondents from, among other things, reproducing or selling the copyright material; and (3) damages or an account of profits. Ms Muscat also commenced a new action (which I will refer to as the second action) in which it is alleged that the sale of the Dolly Girl and cross-over pants infringes Ms Muscat's copyright in the copyright material. In this action she also seeks injunctions and damages or an account of profits. These are the two actions that are being heard together. 12 In order to succeed in a copyright action the plaintiff must, as the word "copyright" implies, prove copying: Francis Day & Hunter Ltd. v Bron [1963] Ch 587, 617 per Upjohn LJ: "[T]he plaintiff in a copyright action must show that a substantial part of the original work has been reproduced; … and, although not expressed in the Act, it is common ground that such a reproduction, … must be causally connected with the work of the original author". It is insufficient to show that the defendant arrived independently at a substantially similar article: Ladbroke (Football) Ltd. v William Hill (Football) Ltd. [1964] 1 WLR 273, 276 per Lord Reid: "[R]eproduction means copying, and does not include cases where an author or compiler produces a substantially similar result by independent work without copying". In order to succeed in the first action, Ms Muscat must prove that the respondents continued to sell Dolly Girl pants in breach of the terms of settlement. 13 It is convenient to deal first with the issue of copying. Here Ms Muscat's case is based largely on inference. There is no witness who can attest to having seen the respondents design or manufacture the Dolly Girl pants. Nor has any witness explained how the cross-over pants came into existence. 14 Although Mr Le carries no onus, his defence to the charge of copying rests on three bases: first, that he had never seen the Mytiko pants; second, that the Dolly Girl pants (which are tight fitting, with a v-waist and a flared leg) were designed without reference to the Mytiko pants; and third, that the cross-over pants were purchased in Hong Kong. 15 Mr Le says that the Dolly Girl pants were created in February 2002 in the following circumstances. Mr Le thought of the style "due to the trend and fashion for teenage groups" and after talking with his sister who mentioned that the "singer" Jennifer Lopez, wore such pants. He then searched the Internet for styles and came up with a few results which he printed but later discarded. Mr Le provided the internet print outs to a friend, Ms Nguyen (a fashion designer), who drew the designs and made the pattern for the pants. Ms Nguyen's drawing depicts flared pants without a v-waist. The patterns were not produced. From Ms Nguyen's pattern Mr Le made a sample garment which was modelled by his sister. During the next six weeks or so changes were made to the design. The final version was completed in March or April 2002. Mr Lee then manufactured the pants in the garage of his Sunshine home with the help of family members. The pants were then sold from the respondents' retail outlets. 16 Mr Le's evidence is supported by his sister and partly verified by Ms Nguyen. Ms Nguyen confirmed that she prepared the pattern for the pants at Mr Le's request and that he provided her with material (including drawings) on which to base the design. Ms Nguyen did not retain any of the drawings. Ms Nguyen also used an existing garment, provided to her by a friend, "as a point of reference". This garment was not produced. 17 Turning to the cross-over pants, I have already mentioned that Mr Le says that he purchased them in Hong Kong. He produced an invoice from Tak Lee Fashion Wholesale which records Mr Le as having purchased "55 pairs of Le Girl Pants Cross Over strecht [sic] (style no. 601) at $22 a pair and 111 Le Girl Pants Cross Over strecht [sic] (style no. 602) at $22 a pair." Mr Le said that the original invoice (which he did not produce) was in Chinese but he requested an English copy "for taxation purposes". He said that the invoice's description of the pants as "Pants Cross Over" was at his suggestion "because of the style of the pants where one piece crossed over the other". Mr Le paid no duty on these pants when he arrived in Australia. He said that although he declared the importation and was queried about the pants by a customs officer, the bags in which they were packed were not examined and he was not asked to pay any duty. 18 If I were to accept Mr Le's evidence the copyright claim would fail because on his account, neither the Dolly Girl pants nor the cross-over pants were copied from the Mytiko pants. There are, however, many difficulties with Mr Le's evidence. One difficulty stems from the similarities between the Dolly Girl and cross-over pants and the Mytiko pants. These similarities are relevant to the issue of infringement because it is necessary to prove not only that the plaintiff's work has been copied but also that the whole or a substantial part of the work has been reproduced: Copyright Act 1968 (Cth), s 14. Similarities are also relevant to the question of copying. There are many instances where the existence of similarities can lead to the inference that the defendant is a copyist: Francis Day & Hunter Ltd. v Bron [1963] Ch 587; 625-627 per Diplock LJ; S. W. Hart & Co. Proprietary Limited v Edwards Hot Water Systems (1985) 159 CLR 466, 481 per Wilson J; Pacific Gaming Pty Ltd v Aristocrat Leisure Industries Pty Ltd (2001) 116 FCR 448, 454 per Sackville, Finn and Kenny JJ. I will, however, momentarily put to one side any consideration of the similarities between the designs and deal with other matters. 19 The first matter that casts doubt on Mr Le's evidence is the Hong Kong invoice. I doubt its authenticity because of the description given to the pants. Ms Egan is Ms Muscat's solicitor. She has the carriage of Ms Muscat's two actions. Ms Egan gave evidence that the expression "cross-over" was coined during a conference with her client on either 29 November 2002 or 2 December 2002. She recalls that the expression was used to distinguish the cross-over pants from the Dolly Girl pants which were the subject of the first action. Ms Egan cannot recall who first used the word "cross-over" but believes that it was either herself, Ms Muscat or Ms Muscat's sister, Karen. I accept Ms Egan's evidence. It is inherently unlikely that Mr Le adopted a similar description in August 2002. At that point he had no reason to distinguish the cross-over style from the Dolly Girl style. In my opinion the invoice is a forgery which was prepared by Mr Le for the purposes of this case. 20 Moreover, I do not accept that Mr Le imported the cross-over pants from Hong Kong, principally because it is near impossible to import 166 pairs of pants (which is the number he brought to Australia) for commercial purposes without paying duty. In August 2002 Mr Hallett was the customs officer charged with the management of enforcement (passengers branch) at Melbourne Airport. Mr Hallett was called to give evidence. He produced Mr Le's customs entry declaration card. By reference to that card Mr Hallett explained that Mr Le did not initially declare that he was importing any goods into the country but at the entry control point declared that he carried more than the stated amount of "alcohol, cigarettes or tobacco". The declaration did not indicate that Mr Le was importing fashion garments for sale in Australia. The customs officer "wrote off" the duty payable on the declared goods. Mr Hallet said that this "write off" did not relate to pants. He explained that "[he] could not foresee a situation where [a customs officer] would actually write … off [duty on 166 pairs of pants] … because that is just too large an amount." Mr Le's explanation in relation to the duty is simply not credible. 21 If the cross-over pants were not purchased in Hong Kong, from where did they originate? At this point it is convenient to mention that the cross-over pants are made from a baby ottoman fabric which, it will be recalled, is the same type of fabric from which the Mytiko pants are made. There is evidence that Mr Le purchased 3,258 metres of baby ottoman fabric from an Australian supplier, AAA Wholesale Fabrics, enough fabric to make 2780 pairs of pants. Most of this fabric was purchased in 2002. During discovery Mr Le produced documents which indicate that he had purchased only 1,341 metres of baby ottoman. He said that he used this fabric to manufacture three quarter length stretch pants. Mr Le was unable to produce any records which verified that all the baby ottoman fabric which he purchased was used for this purpose. I do not believe that it was. In my opinion Mr Le used some of the baby ottoman fabric to manufacture the cross-over pants. Mr Le sought to avoid this conclusion in part by not making proper discovery. 22 There is another piece of evidence that links the cross-over pants to Mr Le. The Dolly Girl and cross-over pants both have a tag with washing instructions sewn into the seam. The tags are identical, save that on the washing instructions for the cross-over pants the words "Made in Australia" have been removed. Mr Le was unable to explain the similarity in the tags. In my view the explanation is clear. Mr Le manufactured both styles of pants. 23 I can now deal with the similarities between the Mytiko and the Dolly Girl and cross-over pants. Ms Greco and another patternmaker, Ms Malcolm, gave evidence on this issue. Ms Greco said that the Dolly Girl and cross-over pants appeared to be of the same cut and design as the Mytiko pants, save that the ends of the cross-over waistband were longer and formed a cross. She described this difference as "only a minor variation to the pattern of these garments". 24 Ms Malcolm's evidence was more specific. She had been supplied with a Dolly Girl garment and a cross-over garment, each in size 8. Ms Malcolm took each garment apart at the seams and from the separated pieces of fabric created a cardboard dressmaking pattern for each pair of pants. She said that these patterns "would … be the same as the patterns used to create the garments originally subject to any shrinkage or stretching of the fabric of the garments caused in production or minor variations caused in cutting or pressing of the fabric during production." Ms Malcolm then compared the following feature of the patterns she had created with the dressmaking pattern for the Mytiko pants: leg length; leg width and shape; width and shape of the flare; crotch measurement; width and measurement of the waistband; hip measurement; and overall pattern block. As a result of this comparison Ms Malcolm formed the view that the dressmaking patterns used to create the Dolly Girl and cross-over pants were "virtually identical" to the Mytiko dressmaking pattern. Ms Malcolm also compared the method of manufacture for the various pants; the overlock stitch, the safety stitch, the stitch length and the care label. She said that these features were identical in the Dolly Girl and cross-over pants and that they were substantially similar to the Mytiko pants. In conclusion Ms Malcolm expressed the view that "[i]f two designers set out to independently create a pair of flared pants with a low waist by reference to the same picture or drawing the chance of the resulting patterns being close to identical is so remote as to be almost impossible." 25 Ms Greco and Ms Malcolm were cross-examined by Mr Heerey for the purpose of highlighting the differences between the patterns. Each witness conceded that the patterns were not identical. That of itself is insufficient to negate the inference of copying. It is also insufficient to avoid the conclusion that a substantial part of the copyright has been reproduced. The question is whether the areas of similarity are sufficient to justify the inference of copying. 26 The following factors should be borne in mind when drawing conclusions from the comparisons which were undertaken. First, the witnesses did not compare the Mytiko pattern with the actual dressmaking patterns used to manufacture the Dolly Girl and cross-over pants. Those patterns were not available. Second, the process of reverse-engineering used by Ms Malcolm will produce dressmaking patterns that may be different from the original Dolly Girl and cross-over patterns. This is because Ms Malcolm made the patterns by tracing from soft unstructured fabric. Each repetition of this process can easily produce a slightly different dressmaking pattern. Third (and this follows from the second observation), any dressmaking pattern that the respondents produced by taking apart the Mytiko garment would not necessarily be exactly the same as the patterns created by Ms Malcolm. 27 During the cross-examination Mr Heerey was able to demonstrate differences in the patterns when the corresponding components of the Mytiko pattern and the reverse-engineered patterns were placed on top of each other. The principal differences were: (i) the nicks (a small notch on the pattern which indicates where the fabric panels should meet before they are sewn) are located at different parts of the panels; (ii) the bottom ends (legs) of the Mytiko panels are curved and are longer by about a few centimetres (both the Le Girl and Dolly Girl bottom ends are straight); (iii) the front and back Mytiko panels are a few centimetres wider than the corresponding Dolly Girl and Le Girl panels; (iv) the front and back Mytiko panels are wider in the thigh area than the navy Dolly Girl and Le Girl panels; (v) the line and curve of the front and back panels is slightly different; (vi) the crotch area of the front and back panels possess different curves, are at different angles and are not of the same length; (vii) the waist panels are different in that (a) the Le Girl pattern is narrower and the angle of the "v" is different and (b) the Dolly Girl waist panel is curved whereas the Mytiko panel is straight. Mr Heerey contends that these differences are sufficient to negate the inference of copying. If similarity was the only factor relied upon by Ms Muscat I might (I stress the word "might") not infer copying. However she relies on a great deal more than just the similarity between the pants. 28 I have already expressed my reasons for rejecting Mr Le's evidence about the origin of the cross-over pants. I should add to these reasons the unlikelihood of Mr Le purchasing pants in Hong Kong that are almost identical to those that he removed from sale the previous week. It seems to me that the true position is this. Following his agreement to withdraw the Dolly Girl pants from sale, Mr Le decided to manufacture and sell a similar style of pant. Perhaps he believed that if the new pants had a different waistband he could avoid copyright infringement. Be that as it may, I am satisfied that Mr Le manufactured the cross-over pants using a pattern copied from the Mytiko pants. 29 I also reject Mr Le's evidence that he independently created the design for the Dolly Girl pants. On this issue I am influenced by Mr Le's disposition to give false evidence when it suits his purpose. To a greater extent I am also influenced by the similarities between the Mytiko and Dolly Girl pants. It is difficult to quarrel with Ms Malcolm's view that the latter were almost certainly not independently produced. I have also considered Ms Nguyen's evidence that she was given a design drawing and a sample pair of pants when instructed to make the pattern for the Dolly Girl garment. The drawing is likely to have derived from the Mytiko pants; the sample may have been a pair of those pants. 30 Another inescapable conclusion is that the dressmaking patterns for both the Dolly Girl and cross-over pants (which at some stage must have existed for these pants to be manufactured) are substantially the same as the Mytiko patterns. I have arrived at this conclusion from the evidence of Ms Greco and Ms Malcolm (which I accept) and from my own observation of the patterns. I have not been influenced by Mr Le's intention to copy the Mytiko design. A common approach in this area is to assume that a copyist is successful in his task: University of London Press, Limited v University Tutorial Press, Limited [1916] 2 Ch 601, 610 per Peterson J: "… there remains the rough and practical test that what is worth copying is prima facie worth protecting". Such aphorisms are misleading and have the potential to undermine the court's fact-finding role in a copyright action. The two elements of reproduction (copying and objective similarity) raise discrete questions. Although the questions may overlap, each must be determined separately. As Lindgren J said in Eagle Homes Pty Ltd v Austec Homes Pty Ltd (1999) 87 FCR 415, 438: "There is a danger that too ready an application of [such aphorisms] will result in the judge or jury finding the existence of a prima facie case when a proper reading of the evidence does not justify it". 31 This brings me to the remaining factual dispute which is whether the respondents continued to sell the Dolly Girl pants in breach of the terms of settlement. I have already summarised the evidence. Ms Ingram and Rachel Muscat allege "trap purchases" on 29 November 2002. The respondents and their witnesses say that this was not possible because by then all Dolly Girl pants had been removed from sale and the remaining stock (approximately 27 pairs of pants) had been delivered to Ms Muscat's solicitors as part of the settlement. 32 The dispute may be resolved in one of the following ways. First, by holding that Ms Ingram and Rachel Muscat fabricated the story of the purchases. The problem with this approach is that (a) neither witness appeared to be giving false evidence; and (b) both Ms Ingram and Rachel Muscat produced a pair of Dolly Girl pants and it is unclear how the pants could have been acquired other than by purchase from the respondents. I accept that one receipt said to evidence the sale, documents the sale of a different type of garment. This may have been a mistake made by the sales assistant. 33 The second approach is to reject the respondents' evidence that the Dolly Girl pants had been removed from sale. As I have already rejected the respondents' account of both the creation of the Dolly Girl pants and acquisition of the cross-over pants, it is a conclusion that I could very easily reach. However, it is unlikely that the respondents would deliberately contravene the terms of settlement. Such action would involve taking a serious risk for a small corresponding gain. In any event, the sales assistants say that no sales took place. By and large I accept their evidence. If the Dolly Girl pants were openly being offered for sale the sale assistants would be aware of it. 34 The third approach is, in effect, to accept the evidence of both sides. This would not necessarily result in inconsistent findings. A possible, indeed a likely, explanation of what occurred is that a few Dolly Girl pants inadvertently found their way back onto the racks. Such a mistake could easily happen. With the exception of the waistline, there is little to distinguish the Dolly Girl from the cross-over pants. A busy sales assistant might not notice the difference. This is what I believe happened. A handful of Dolly Girl pants were not removed from the respondents' stores and were sold contrary the respondents' specific instructions. The sales assistants are not to blame for the oversight. It was the respondents' responsibility to ensure that all unsold stock was removed. 35 The next task is to consider the effect that these findings will have on the legal rights and obligations of the parties. Ms Muscat has established a breach of the terms of settlement. The first action should therefore be reinstated so she can obtain the appropriate relief. There will be a permanent injunction to give better effect to cl 1 of the terms of settlement. That clause provides, among other things, that the respondents "will cease and forever refrain (a) from reproducing, or substantially reproducing [the] Artistic and Literary Copyright Materials …; [and] (b) from manufacturing, importing for sale, selling, or by way of trade, offering and/or exposing for sale, or exhibiting in public in any colour [the Dolly Girl Pants]." Ms Muscat is also entitled to damages for breach of the settlement agreement. The agreement provides that on breach Ms Muscat is entitled to have judgment entered for the sum of $20,000 less any payments made by the respondents in order to satisfy their obligation to pay $16,000 by 25 February 2003. The respondents did not assert that this was an illegal penalty. Accordingly, Ms Muscat is also entitled to judgment for $8,000. (The respondents have already paid her $12,000 out of the $16,000 due under the terms). 36 Ms Muscat's claim for breach of copyright in the second action rests on two bases. First it is based on a claim of copyright in the Mytiko design, the cardboard dressmaking pattern, the graded dressmaking pattern and the scanned pattern as artistic works. Second Ms Muscat claims copyright in the sample garment as a work of artistic craftsmanship. 37 At one time there was doubt as to whether a design for a dress or a dressmaking pattern could be an original artistic work. Clauson J avoided the issue in Burke and Margot Burke, Limited v Spicers Dress Designs [1936] Ch 400. The judge also left open whether copyright subsists in clothing. There is now authority that a design drawing can be an artistic work: Klarman (H.) Ld v Henshaw Linen Supplies [1960] RPC 150 (a plastic container bearing a representation of the head and shoulder of a woman and certain advertising material); Lerose Limited v Hawick Jersey International Limited [1974] RPC 42 (a "point pattern" document for a knitting machine); Compagnie Industrielle de Precontrainte et D'Equipment des Constructions SA v First Melbourne Securities Pty Ltd (1999) 44 IPR 512 (engineering drawings of expansion joints). Similarly copyright may subsist in a dressmaking pattern: Radley Gowns Ltd. v Costas Spyrou (trading as "Touch of Class" and "Fiesta Girl") [1975] FSPLR 455 (cutting patterns); Thornton Hall Manufacturing Ltd v Shanton Apparel Ltd (No 2) [1989] 1 NZLR 239 (pattern pieces cut out of a think piece of cardboard). In any event, the respondents concede that copyright subsists in the design and the patterns. 38 Accordingly the findings that I have made establish, subject to any defences, that the respondents have infringed Ms Muscat's copyright in the design drawing and the dressmaking patterns by their production of the dressmaking patterns for the Dolly Girl and cross-over pants. 39 Whether the actual sewn up Dolly Girl and cross-over pants infringe Ms Muscat's copyright in either the design drawing or the dressmaking patterns raises different issues. Generally speaking, a two-dimensional artistic work "… shall be deemed to have been reproduced … if a version of the work is reproduced in a three-dimensional form": s 21(3)(a) of the Copyright Act. An item of clothing can constitute a three dimensional copy of a design drawing: J. Bernstein Ltd. v Sydney Murray Ltd [1981] RPC 303, 329. However there will be a problem if the three dimensional reproduction is not of a similar appearance to the two dimensional copyright work. In King Features Syndicate, Incorporated v O. and M. Kleeman, Limited [1941] AC 417, 424 Lord Maugham said that the question for the court "is one of fact [and where] … the copy or the reproduction is not exact the court must examine the degree of resemblance". See also S.W. Hart & Co. Proprietary Limited v Edwards Hot Water Systems (1985) 159 CLR 466, 474 per Gibbs CJ: "The question is not whether there are dissimilarities but whether the respondent's products closely resemble the appellant's [works] or a substantial part of them". 40 The question whether the Dolly Girl and cross-over pants resemble Ms Muscat's design drawings should be answered in the affirmative. The qualitative features of the design drawing are the low waist, the "v" shape that is incorporated in the waist, the tight fitting pants and the flares. All these features are evident in the respondents' three-dimensional garments. 41 A more difficult question is whether the respondents' pants bear a sufficient resemblance to the Mytiko dressmaking pattern. As previously discussed the dressmaking pattern comprised five components – two front panels, two back panels, and a waist panel. If I were to apply Gibbs CJ's test to the sewn up pants, it is quite obvious that these pants do not "closely resemble" the individual cardboard panels. Such a test was applied in Merlet v Mothercare plc (1984) 2 IPR 456. There Walton J said that the cutting pattern for a cape was not reproduced in three-dimensions because the pattern would not be visible in the three-dimensional sewn up garment. 42 Laddie, Prescott and Vittoria, in their text The Modern Law of Copyright and Designs (2nd ed, 1995) vol 1 at para 3.71 treat the case as wrongly decided. The authors hold that the judge's reasoning "ignored the fact that the panels present in the defendants' garment must have existed on their own before they were sewn in". I agree with this view. The question in this case is whether the fabric when cut according to each component of each pattern but before the individual parts were sewn together, is similar to the individual components of the Mytiko dressmaking pattern. Of course the answer is yes. 43 I will now move to the sample garments. The question here is whether these prototypes are works of artistic craftsmanship. Although parliament has provided for copyright protection for works of artistic craftsmanship (s 10 (1)), the Act does not define what is meant by this phrase. In Coogi Australia Pty Ltd v Hysport International Pty Ltd (1998) 86 FCR 154, 164 Drummond J, said that "[t]he phrase 'works of artistic craftsmanship' is a composite phrase that must be construed as a whole". I propose to follow this instruction. However, for present purposes it is convenient to consider separately what is meant by "artistic" and "craftsmanship". 44 There is settled authority as to the requisite artistic quality required for a work to be adjudged a work of artistic craftsmanship. Although it is not possible to state exhaustively the considerations that may be taken into account, it is appropriate that I mention those that are relevant in relation to the sample garment. A work will only qualify as a work of artistic craftsmanship if it has an element of genuine artistic quality that "[appeals] to the aesthetic tastes of those who observe it" even if such an article "be utilitarian": Cuisenaire v Reed [1963] VR 719, 730. The level of artistic appeal required is greater than mere visual appeal: George Hensher Ltd. v Restawile Upholstery (Lancs.) Ltd. [1976] AC 64, 95. A court will determine the level of aesthetic appeal required for a work of artistic craftsmanship objectively and on the basis of the evidence before it; evidence that the creator intended to make an article possessing aesthetic qualities is "important, although not essential": George Hensher Ltd. v Restawile Upholstery (Lancs.) Ltd. [1976] AC 64, 81; Coogi Australia Pty Ltd v Hysport International Pty Ltd (1998) 86 FCR 154, 165. Finally the minimum level of aesthetic level required will not be met because a " … segment of the public can be found which may have been persuaded by advertising or by a transient fad to want to own the work because of its visual appeal does not necessarily mean that it must have the requisite minimum level of aesthetic value": Coogi Australia Pty Ltd v Hysport International Pty Ltd (1998) 86 FCR 154, 165. See also George Hensher Ltd. v Restawile Upholstery (Lancs.) Ltd. [1976] AC 64, 79 per Lord Reid: "No doubt many customers bought the furniture because they thought it looked nice as well as being comfortable. But looking nice appears to me to fall considerably short of having artistic appeal". 45 The more difficult question is to discern what is meant by craftsmanship. In this case the question is more specific. It is whether a sample can be a work of craftsmanship. These issues were canvassed in George Hensher Ltd. v Restawile Upholstery (Lancs.) Ltd. [1976] AC 64 at 76, which is the leading case in this area. The plaintiff manufactured a prototype suite of furniture which it called the Bronx. It was designed and produced jointly by a team of three persons employed by the plaintiff. The defendant manufactured a suite of furniture remarkably similar to the Bronx. The plaintiff sued for breach of copyright. As regards subsistence of copyright, the defendant conceded that the prototype was a work of craftsmanship. What was at issue then was whether the prototype was "a work of artistic craftsmanship". Consequently there was no need to discuss in any detail what constitutes craftsmanship. At trial ([1973] 1 WLR 144) Graham J appears to have assumed that the work must be, or must substantially be, hand-made. His Lordship said (at 153) that a work of artistic craftsmanship "does denote a work which, while it is the subject of craftsmanship – that is to say made or designed by a craftsman – at the same time has individual characteristics which distinguish it from a mere utilitarian work of craftsmanship which has no distinctive features of design." The Court of Appeal ([1976] AC 64 at 66) proceeded upon the same assumption. It cited, with apparent approval (at 70), the decision of Pape J in Cuisenaire v Reed [1963] VR 719. In Cuisenaire v Reed, the plaintiff claimed copyright in a set of coloured rods for the teaching of arithmetic. The original rods had been produced by cutting a ruler (which was of square section) into lengths and then colouring the wood. Pape J held that the rods were not a work of craftsmanship. He said (at 729): "The first question then is whether the making of these 241 strips of coloured wood is a work of craftsmanship. The Shorter Oxford Dictionary defines a 'craft' as a 'Calling requiring special skill and knowledge especially a manual art – a handicraft', and 'craftsman' as a 'man who practices a handicraft – an artisan'. Accepting as I do these definitions, it is I think impossible to say that this box of rods is a work of craftsmanship. The evidence showed that the three original sets of 10 rods were made by the plaintiff himself by cutting school rulers into the required lengths and colouring them, and it further shows that the boxes of 241 rods sold by the Cuisenaire Company of Australia are made by Geronimo Gattegno (who admitted that he was not a skilled woodworker) with the part-time assistance of a man who was employed by the Victorian Railways Commissioners at the Box Hill railway station. It is obvious that no special skill or training is required to cut strips of wood into predetermined lengths and to colour them in different colours, and in my view it cannot be said that any craftsmanship was involved in their production. Any person who was physically capable of using a saw could produce them." 46 When Hensher reached the House of Lords it became clear that the concession that the prototype was a work of craftsmanship had been wrongly made. The prototype was nothing more than a "knock up" and not a completed work. A number of the Law Lords suggested that it could not amount to a work of craftsmanship: Lord Reid at 77; Lord Morris of Borth-y-Gest at 80-81. Further, although the meaning of craftsmanship had not been argued, obiter opinions on it were expressed. Lord Reid said (at 77): "A work of craftsmanship suggests to me a durable useful handmade object and a work of artistic craftsmanship suggests something, whether of practical utility or not, which its owner values because of its artistic character. It appears to me to be difficult to bring within the terms or the intention of the statute an object which, however artistic it might appear to be, is only intended to be used as a step in a commercial operation and has no value in itself." To the same effect is a statement by Viscount Dilhorne (at 84): "A work of craftsmanship is, in my opinion, something made by hand and not something mass produced." 47 The other member of the House to deal with the point was Lord Simon. His Lordship considered the meaning of the expression "works of artistic craftsmanship" in the social and legal background against which it was first used in copyright legislation, the Copyright Act 1911 (UK). That background included the Arts and Crafts movement which was established to protect the applied arts by John Ruskin and William Morris. They opposed the separation between training for the applied arts and education for the fine arts. As a result of their teaching a number of schools were established in England to revive handicrafts and to bridge the gap between the applied and the fine arts. After summarising the history of the movement in England (the developments in continental Europe were not mentioned), his Lordship said (at 91): "So, although 'works of artistic craftsmanship' cannot be adequately construed without bearing in mind the aims and achievements of the Arts and Crafts movement, 'craftsmanship' in the statutory phrase cannot be limited to handicraft; nor is the word 'artistic' incompatible with machine production …". (citation omitted) And later (at 91): "A work of craftsmanship, even though it cannot be confined to handicraft, at least presupposes special training, skill and knowledge for its production. 'Craftsmanship', particularly when considered in its historical context, implies a manifestation of pride in sound workmanship – a rejection of the shoddy, the meretricious, the facile. But the craftsmanship – not the work itself – must, in addition, be artistic." (citations omitted) 48 These principles were recently considered in relation to sample garments in Guild v Eskandar Limited [2001] FSR 645. There Rimer J had to decide whether a sample shirt, sweater and cardigan were works of artistic craftsmanship. The plaintiff, Mrs Guild, claimed that her works were inspired from "ethnic" or "peasant" dresses. Her clothing received critical acclaim in fashion circles and were featured in a modern fashion exhibition at the Victoria and Albert Museum. Nevertheless, Rimer J held that they were not works of artistic craftsmanship. He said (at 700): "I derive from [Hensher's case] that, in deciding whether Mrs Guild's garments – or perhaps more accurately the original samples – are works of "artistic craftsmanship", I have to assess them in the simplicity of their unworn state, although I respectfully question whether, in the case of a garment, it is not at least legitimate to view it on a mannequin. … A primary consideration, although not necessarily the only one, is whether or not its maker had the conscious purpose of creating a work of art and, if he did – and provided he has not manifestly failed – then a work of art it will be. I am not satisfied on the evidence that the sample garments – made as they were as prototypes for mass production – and being machine made garments than which few can come much simpler, can reasonably be regarded as works of craftsmanship. There is no evidence of any special elements of craftsmanship going into their manufacture. I do not consider anyone would regard that as a natural way to describe them, and my instinctive reaction is that they are not works of craftsmanship. Nor is there any evidence satisfying me that [the plaintiff] intended to create works of art, or even regarded herself as an artist. She did not say so or suggest it, and I find it difficult to conclude other than that she chose to design and market garments of this particular style because it appealed to her and she considered it would also appeal as an original and attractive style to a material section of the buying public. Many types of garments will be made and sold on this basis, but considerations such as these will not by themselves justify an inference that the garments are to be regarded as works of art." 49 These comments apply equally to this case. The sample garments were not created as works of art. They came into existence for the purpose of determining how the design would look and to enable Ms Muscat to decide whether any changes should be made before production commenced. In any event, the sample garments are not works of craftsmanship and Ms Muscat never intended them to be. 50 We have now reached the point where the only basis upon which the respondents can avoid judgment for breach of copyright is if they can rely on s 77 of the Copyright Act. Section 77 provides a defence to infringement of copyright where a design contained in an artistic work has been industrially applied and the design has not been registered. The section relevantly provides: "77(1)(a) copyright subsists in an artistic work (other than a building or a model of a building, or a work of artistic craftsmanship) whether made before the commencement of this section or otherwise; (b) a corresponding design is applied industrially, whether in Australia or elsewhere, by or with the licence of the owner of the copyright in the work in the place where the industrial application happens; (c) at any time on or after the commencement of this section, articles to which the corresponding design has been so applied (in this section called 'articles made to the corresponding design') are sold, let for hire or offered or exposed for sale or hire, whether in Australia or elsewhere; and (d) at that time, the corresponding design is not registrable under the Designs Act 1906 or has not been registered under that Act." (2) It is not an infringement of the copyright in the artistic work to reproduce the work, on or after the day on which articles made to the corresponding design are first so sold, let for hire or offered or exposed for sale or hire, by applying that, or any other, corresponding design to an article." The definition of "corresponding design" is to be found in s 74. It is defined as: "in relation to an artistic work … a design that, when applied to an article, results in a reproduction of that work, but does not include a design consisting solely of features of two-dimensional pattern or ornament applicable to a surface of an article." 51 Section 77(3) states that the defence afforded by s 77(2) does not apply to articles excluded from registration by regulations made under the Designs Act 1906 (Cth). The Designs Regulations 1982 exclude certain articles from registration. Regulation 11 relevantly provides: "(1) Subject to subregulation (2), for the purposes of sub-section 17(2) of the Act, the Registrar shall not register under the Act any designs for the following articles, being articles that are primarily literary or artistic in character: (a) articles on which there is printing, being: …. (iv) dress-making patterns … " 52 The conditions that must be satisfied for the defence to apply are: (1) that copyright subsists in the artistic work; (2) the corresponding design contained in the artistic work, when applied to an article, results in a reproduction of the artistic work; (3) there is an industrial application of the design contained in the artistic work; (4) articles made to the corresponding design have been sold; and (5) the design has not been registered under the Designs Act. 53 Dealing first with the design drawing, there is no dispute that the first condition is met: copyright subsists in the drawing. With respect to the second condition, it should firstly be noted that the word "design" is not defined in the Copyright Act. However, the cases show that the "design" as referred to in ss 74 to 77 is a design as defined in the Designs Act: Edwards Hot Water Systems v S W Hart & Co Pty Ltd (1983) 1 IPR 228, 256 per Franki J; Kevlacat Pty Ltd v Trailcraft Marine Pty Ltd (1987) 11 IPR 77, 94 per French J; Hosokawa Micron International Inc v Fortune (1990) 26 FCR 393, 396 per Lockhart J. Further in Greenfield Products Pty Ltd v Rover Scott Bonnar Ltd (1990) 17 IPR 417, 431-432 Pincus J said that it is not a requirement that the design be registrable under the Designs Act. 54 The word "design" is defined in s 4 of the Designs Act to mean "features of shape, configuration, pattern or ornamentation applicable to an article, being features that, in the finished article, can be judged by the eye, but does not include a method or principle of construction." The respondents concede that the design drawing qualifies as a design. In Dalgety Australia Operations Ltd v FF Seeley Nominees Pty Ltd (1985) 5 IPR 97, 109 Bollen J said: "Without the design the article would still have its own character. That is to say, without a design a chair would still be a chair, a fork would still be a fork, a table would still be a table. The idea in the design will operate on the article. The design will appeal to the eye giving that article its own peculiar appearance to the eye. The design turns a chair into something more than a mere chair. It becomes a chair with a conceptional or suggestion about shape or configuration beyond the fundamental form of a chair." It is quite obvious that certain features in Ms Muscat's design drawing (such as the low v-shaped waist band and the flared leg) were added solely for their visual effect. This is not surprising given that the purpose of the design drawing was to create an item of clothing which was both distinctive and appealing. 55 Ms Muscat accepts that features of shape and configuration contained in the design have been applied to an article (the Mytiko pants). She also accepts that the design has been applied industrially (here because the design has been applied to more than 50 articles: Copyright Regulations 1969, r 17(1)(a)), that the pants have been sold, and that the design is not registered. Accordingly, Ms Muscat concedes that s 77 provides the respondents with a defence in relation to the reproduction of the design drawing by the manufacture and sale of the cross-over and Dolly Girl pants. 56 On the other hand Ms Muscat contends that the s 77 defence is not available for the reproduction of the design by the production of the respondents' cardboard dressmaking patterns. Her submission is that "[t]hese reproductions are not saved by s 77 … because, even if the [Mytiko] cardboard dress-making patterns are regarded as 'articles' to which features of shape and configuration have been applied, there has been no industrial application of such articles within s 77". This submission is based on a misconstruction of s 77. The question is not whether the dressmaking patterns have been applied industrially. Whether they have or not is altogether irrelevant. The true question is whether the design embodied in the artistic work (that is in the design drawing) has been applied industrially. Clearly it has by the manufacture of the Mytiko pants. 57 There is however a different reason why s 77 is not available in relation to the cardboard dressmaking patterns. The s 77(2) defence only applies when a defendant reproduces the plaintiff's work "by applying that, or any other, corresponding design to an article". In this context "article" means an article of manufacture: Amalgamated Mining Services Pty Ltd v Warman International Ltd (1992) 24 IPR 461, 474 per Wilcox J: "The word 'article' is not defined for the purposes of the Copyright Act but, in the context, it must bear its Designs Act meaning. The definition in that Act refers to an 'article of manufacture'". It follows that s 77(2) has no application to what has come to be known as "plan to plan" copying, that is where an artistic work (such as a design drawing) is reproduced by a drawing or plan in the course of the industrial application of the design: Amalgamated Mining Services Pty Ltd v Warman International Ltd (1992) 24 IPR 461, 474; Shacklady v Atkins (1994) 30 IPR 387, 393. See also Compagnie Industrielle de Precontrainte et D'Equipment des Constructions SA v First Melbourne Securities Pty Ltd (1999) 44 IPR 512, 530-531 per Merkel J: "It was also common ground that the s 77 defence only applies to three-dimensional reproductions of CIPEC's two-dimensional copyright works. Thus s 77 has no application to plan copyright infringement". As the respondents' dressmaking patterns are not articles of manufacture, s 77 has no application. 58 Interestingly, in 1995 the Institute of Patent Attorneys of Australia lodged a submission with the Australian Law Reform Commission in relation to its inquiry on Designs: Australian Law Reform Commission, Designs, Report No 74 (1995). The IPAA criticised the plan to plan exception stating that such an interpretation of s 77(2) is inconsistent with the purpose of the section. In particular, the IPAA submitted (quoted at 327) that: "[t]he essential problem is that whilst it may be permissible to reproduce in three dimensions the artistic work for purposes of industrial application, it is not permissible to produce either a plan or drawing of the article, or possibly a mould from which the article is made. Unless these actions are permissible, the whole purpose of avoiding dual protection for three dimensional articles is null and void". I understand that the Designs (Consequential Amendments) Bill 2002 (Cth), presently before parliament, is likely to accommodate this criticism. 59 The next question is whether the s 77 defence is available in relation to the reproduction of the Mytiko dressmaking patterns. (Here I will not distinguish between the Mytiko cardboard dressmaking pattern, the graded dressmaking pattern and the scanned patterns). The respondents reproduced the Mytiko dressmaking patterns in two ways: first, by producing the dressmaking patterns used to manufacture the Dolly Girl and cross-over pants; and second, by manufacturing the Dolly Girl and cross-over pants themselves. It is necessary to consider separately the application of s 77 to each act. 60 It is, I suppose, convenient (though out of order) to begin with s 77(3) and reg 11. Regulation 11 is difficult to construe. In Klarmann (H.) Ld. v Henshaw Linen Supplies [1960] RPC 150, Roxburgh J described Design Rule 26, upon which reg 11 is based, (at 152) as a "most extraordinary jumble of conceptions". Things have not improved since then. The position is certainly not clarified by Lehane J in Wrangler Apparel Corp v Classic Boots Australia Pty Ltd (1997) 38 IPR 19. There Lehane J (at 27) expressed the tentative view (he was dealing with an application for an interlocutory injunction) that reg 11 only excludes from registration (and consequently from the operation of s 77) a design for a pattern (eg a dressmaking pattern) and not the pattern for some other article (in that case, jeans). Although I have some doubts about this approach, it is not necessary to resolve this issue. In this case the regulation has no operation because the dressmaking patterns are not, in any event, "articles on which there is printing", which is a condition to be satisfied in relation to each article listed in sub-clause (a). The patterns are certainly labelled for identification purposes. It is unlikely however, that this brings the patterns within the description of "articles on which there is printing". What is contemplated is "printing" of a different character. I have in mind two possibilities. The first is printing which reproduces a design on a surface. The second and more common meaning is the impression of letters, figure or characters by ink or type. We have neither type of printing here. 61 There is a dispute as to whether Ms Muscat's dressmaking patterns satisfy the conditions contained in s 77(1). The first issue is whether the features of the patterns fall within the definition of "design". Ms Muscat contends that it is necessary to consider each component of the dressmaking patterns (there are five components for each pattern) separately and determine whether each component embodies a design. I am prepared to proceed on the assumption that this is the correct approach. (For the record, however, I should note that the assumption is unlikely to be correct when the question is whether the design of each component can be registered under the Designs Act: Sifam Electrical Instrument Company Limited v Sangamo Weston Limited [1973] RPC 899; Regina v Registered Designs Appeal Tribunal; Ex parte Ford Motor Co. Ltd. [1995] 1 WLR 18). Ms Muscat then says that each component is merely a "method or principle of construction" and therefore not a corresponding design as defined in s 74. I do not agree that it is. First, in Hosokawa Micron International Inc v Fortune (1990) 26 FCR 393, 406, Lockhart J said that a method or principle of construction is a process or operation by which a shape is produced as opposed to the shape itself. This suggests that the term "method or principle of construction" includes written instructions as to how the shape or configuration depicted on the design is to be created. Again, I am prepared to accept, without deciding, that a dressmaking pattern constitutes an instruction regarding the manner in which the shape of the various components are to be produced. However, even on this assumption the argument must be rejected because this would not prevent the dressmaking patterns from also being a design: Compagnie Industrielle de Precontrainte et D'Equipment des Constructions SA v First Melbourne Securities Pty Ltd (1999) 44 IPR 512, 533 per Merkel J. This is because each component of the dressmaking pattern has its own special distinctive appearance which appeals to my eye, as the judge. I imagine that it would also appeal to the eye of a fashion designer. I would reach the same conclusion if the components are looked at as a single unit. 62 The second area of dispute (the ambit of which, is very unclear) also arises from the definition of "design". According to the definition a feature of shape or configuration can only be a design if, "in the finished article, [the feature] can be judged by the eye." Ms Muscat contends that the dressmaking patterns' features (whether regarded as one unit or when considered on a component by component basis) cannot be seen in the sewn up Mytiko pants. Again, I do not agree. First, in my view the finished article is the pant. In this regard see R v Registered Designs Appeal Tribunal; Ex parte Ford Motor Co. Ltd. [1995] 1 WLR 18, 25-26 where Lord Mustil,in interpreting similarly worded definitions to ours, held that the word "article" refers to an item which is on the market and sold separately. Secondly, my own observation leads me to conclude that features of the dressmaking patterns (or the features of the components of the dressmaking patterns) can be seen in the completed Mytiko pants. If it be relevant, they can also be seen in the component parts. 63 The final issue is whether the s 77(2) defence applies in relation to the respondents' dressmaking patterns. In my opinion, the defence does not apply because the dressmaking patterns are not articles of manufacture. 64 There are still two outstanding claims that must be dealt with: the claim for passing off and the alleged breach of the Fair Trading Act. These claims received little attention in the evidence, were dealt with in a few lines in the written submissions and were hardly mentioned in oral argument. I will dispose of them as shortly as they were dealt with by the parties. 65 The alleged claim for passing off is based on the premise that consumers will mistakenly identify the Dolly Girl and cross-over pants as originating from Ms Muscat. The only basis for the premise is that the pants look similar to the Mytiko pants. Little evidence was called to substantiate the claim. Nor is the premise self-evident. In any event the cases hold that there will be no passing off where similar looking items are "properly labelled": Parkdale Customs Build Furniture Proprietary Limited v Puxu Proprietary Limited (1982) 149 CLR 191, 199-200 per Gibbs CJ. See also Dr Martens Australia Pty Ltd v Rivers (Australia) Pty Ltd (1999) 95 FCR 136; Koninklijke Philips Electronics NV v Remington Products Australia Pty Ltd (2000) 100 FCR 90. The respondents always sold their garments under the "Dolly Girl" label. 66 The Fair Trading Actclaim is also based on a false premise. Ms Muscat alleged misleading conduct on the basis that the cross-over pants were labelled "Made in Australia" when in truth they were manufactured in Hong Kong. In virtue of my finding that the cross-over pants were manufactured by Mr Le in Australia, this allegation is not made out. 67 Ms Muscat should within 21 days file short minutes of orders to give effect to these reasons. I will also hear the parties on the directions that should be made to bring the outstanding issues to trial. I certify that the preceding sixty-seven (67) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Finkelstein. Associate: Dated: 19 December 2003 Counsel for the Applicant: Mr C Golvan SC Solicitor for the Applicant: Middletons Lawyers Counsel for the Respondent: Mr E Heerey Solicitor for the Respondent: Allan McMonnies Date of Hearing: 2, 3 & 4 April 2003 Date of Judgment: 19 December 2003