ATB Sales Limited v Rich Energy: A ‘Staggering’ Use of Court time?
The recent judgment in ATB Sales Limited v Rich Energy Limited  EWHC 1207 (IPEC) illustrates the difficulties parties will have in defending copyright infringement claims over artistic works, if they can only provide limited documentary proof of the creative design process.
ATB Sales Limited (“Claimant”) brought the action against three Defendants: Rich Energy Limited (“First Defendant”); Mr William Stoney, the director and sole shareholder of the First Defendant (“Second Defendant”); and Mr Sean Kelly, the chief designer of the First Defendant’s logo (“Third Defendant”).
The dispute centred on the design of the First Defendant’s logo, which the Claimant alleged was copied from the whole, or a substantial part, of its logo. Furthermore, the Claimant argued that the First Defendant’s use of the logo on products for sale, as well as its use in promotional, advertising and marketing materials infringed the Claimant’s copyright, under sections 17, 18 and 20 of the Copyright, Designs and Patents Act 1988 (the “Act”).
In addition, the Claimant alleged that the Second Defendant and Third Defendant should be held liable for these infringements as joint tortfeasors. For comparison, both of the logos (as set out in the judgment) can be seen here:
Establishing copyright – and infringement
At the outset, the Defendants conceded that copyright subsisted in the Claimant’s logo. As such, the infringement claim turned purely on whether the Defendants had copied a “substantial part” of the Claimant’s logo, for the purposes of section 16(3) of the Act. In establishing a prima facie case of copying, the Judge referenced the seminal case of Designers Guild v Russell Williams Textiles  1 WLR 2416. This case noted that if there is substantial similarity between two works and proof of access to the original work by the alleged infringers, the burden of proof falls on a defendant to prove that they did not copy the original work.
However, in this instance, the Judge found that there were a number of issues with the Defendants’ case.
The Defendants’ Evidence
In reviewing the chronology of events, the Judge did not consider the Defendants credible or reliable and treated all of the Defendants’ evidence “with a high degree of caution”. This was for a number of reasons.
She found that the Defendants were evasive under cross-examination, and their responses revealed inconsistencies with their submitted pleadings and evidence. Moreover, the Defendants were unable to show the court contemporaneous design notes for their logo, instead relying on a ‘Brand Document’ guide (created after the commencement of proceedings), which offered a retrospective explanation of the Defendants’ creative process.
The Defendants argued that the court should assume that their evidence was honest because the Claimants had not specifically pleaded fraud or dishonesty. The court wasted little time in rejecting this assertion, because dishonesty may be suspected but not pleaded where there is insufficient evidence to support it. Further, the court cannot test the honesty of a witness until they have been cross-examined.
Substantial Similarity and Proof of Access
In Designers Guild, Lord Millett outlined that the court must “judge whether the particular similarities relied on are sufficiently close, numerous or extensive to be more likely to be the result of copying than coincidence.”
In this case, the Judge noted that there were a number of uncommon similarities between the Claimant’s and First Defendant’s logos, specifically being “the unusual proportions of the pointed, triangular face; the elegant pointed antlers; the placement of the inner, angled antlers; and the specific manner in which this stag’s head is highly reduced and simplified”. In line with the reasoning in Infopaq International A/S v Danske Dagblades Forening (Case C-5/08), the Judge concluded that there were clear elements of the expression of the intellectual creation of the author of the Claimant’s logo in the First Defendant’s logo.
To satisfy the ‘proof of access’ limb, it is necessary to illustrate that there was actual access to the Claimant’s logo. The Judge was satisfied that the combination of the Claimant’s logo having been available on its website from 2010 and the Defendants’ testimony that they had looked at “hundreds” of stag head logos for inspiration illustrated that it was certainly plausible that the Defendants had had access to the Claimant’s logo.
On the balance of probabilities, the Judge ruled that rather than having independently created their logo, the Defendants had been familiar with, and had directly and knowingly copied the Claimant’s logo in designing their own.
In determining joint tortfeasorship, the Judge applied the test as set out in Fish & Fish Ltd v Sea Shepherd UK  UKSC 10 and summarised in Vertical Leisure v Poleplus Limited  EWHC 841 (IPEC).
Subject to the de minimis threshold, the Judge considered that a joint tortfeasor must have actively co-operated to bring about the act of the primary tortfeasor and also have intended that his co-operation would help to bring about the tortious act.
Ruling consistently with her earlier findings, the Judge determined that the Second and Third Defendants were jointly liable for the First Defendant’s copyright infringements, as joint tortfeasors.
How can parties working in the design field protect themselves?
This case shows that it is imperative for parties working in the design field to ensure that they keep clear, dated and accurate records of the creative process underpinning their designs, in order to evidence the progression of their ideas over the design process, in the event of a future copyright claim.
In addition, parties may wish to consider taking measures such as embedding watermarks into their digital designs, to prevent against any software-based tampering.
This post features contributions from Dillon Ravikumar.