BMW 'astonished' after losing intellectual property case

AutoBlog: BMW 'astonished' after losing intellectual property case

BMW has been tussling in courtrooms with a South African auto parts supplier called Grandmark for 13 years. The real issue revolves, of course, around money, but the legal issue revolves around intellectual property rights regarding the design of car parts.

South Africa allows entities to register an "Aesthetic Design" (AD) that "is new and original, and that has features which 'appeal to and are judged solely by the eye';" BMW has received Aesthetic Design registrations for both its vehicles and the parts, and so argues that Grandmark's manufacture of identical replacement parts infringes on its intellectual property re: the AD registration.

BMW won a court order 12 years ago against Grandmark over replacement hood, headlight, grille and front fender designs, but Grandmark appealed, arguing that the AD registration for such components is ultimately invalid – that BMW can't claim a particular AD intellectual property for product shapes like headlights and fenders because parts they "are not judged visually but are dictated by function," as opposed to the overall shape of the car (which BMW also registers). A bit of clarity: South Africa also allows for the registration of Functional Design, but car parts are specifically excluded – that's why BMW registers parts under the AD provisions. The larger picture to all of this is that if Grandmark won, it would officially open the door to generic replacement car parts in this market.

After having been at this since the last millennium, the Gauteng North High Court has finally ruled in favor of Grandmark. The judge opined that car parts must be considered separately from the entire car, and says BMW needed to explain the "novel and aesthetic features" of the individual parts to uphold its claim to IP rights, which the judge felt BMW didn't do. It was the judge's opinion that the parts in question have "no features that will or may influence the choice or selection or have some individual characteristics which are calculated to attract the attention of the beholder."

BMW was naturally dismayed by the ruling, and has said it will study it closely before deciding what to do next.