Secondary Infringement
89.Section 23 of the 1988 Act provides: “(a)
possesses in the course of business, (b)
sells or lets for hire, or offers or exposes for sale or hire, (c)
in the course of a business exhibits in public, or distributes, or (d)
an article which is, and which he knows or has reason to believe is, an infringing copy of the work.” 90.Secondary infringement in the present case turns on whether EWM had reason to believe that the Visage, Cingo and Bengal Knittex Fabrics were infringing copies of the Wave Fabric. In L.A. Gear Inc v Hi-Tech Sports plc [1992] FSR 121, Morritt J encapsulated his understanding of that test: “…it seems to me that ‘reason to believe’ must involve the concept of knowledge of facts from which a reasonable man would arrive at the relevant belief. Facts from which a reasonable man might suspect the relevant conclusion cannot be enough. Moreover, as it seems to me, the phrase does connote the allowance of a period of time to enable the reasonable man to evaluate those facts so as to convert the facts into a reasonable belief.” 91.On appeal from Morritt J’s judgment (reported also at [1992] FSR 121, beginning at 132) this passage was quoted by Nourse LJ (with whom Staughton LJ and Sir Michael Kerr agreed) with clear approval (at pp.138-9). 92.In ZYX Music GmbH v King [1995] FSR 566 Lightman J said that the reasonable man must be such an individual in the defendant’s position (at 578). 93.94.It was admitted by EWM in its Defence that when it stopped placing orders with Response for tops made from the Wave Fabric, it supplied a sample of a top made from the Wave Fabric to alternative suppliers, including Visage, along with a specification sheet. This was confirmed by Ms Blythe in her witness statement although she denied that EWM made any request that the Wave Fabric should be copied. A similar specification was subsequently supplied to Cingo and Bengal Knittex. Ms Blythe did not say that a fabric sample was given to these two manufacturers. 95.Ms Blythe emphasised that she was aware of intellectual property rights and that they should not be infringed. She also said this: “I did not regard the replacement of a garment in our range with another one which uses a fabric which is generally available on the market and is similar to but materially different from the original as wrong or inappropriate. It is standard or commercial practice.” 96.97.Ms Blythe said that when Visage supplied a sample of the Visage Fabric it did not appear to her to represent a copy of the Wave Fabric. Similarly, the Cingo fabric was in Ms Blythe’s view similar to the Wave Fabric but materially different. On the other hand, she said that the Bengal Knittex Fabric (and presumably also the Cingo Fabric) was sufficiently similar to Visage Fabric for EWM to transition from one to the other. I infer that the similarities between the Wave Fabric and the Visage Fabric were likewise sufficient for EWM transition from one to the other. 98.In cross-examination Ms Blythe conceded that, contrary to the impression given in her witness statement, she was not part of the sourcing team and had no direct knowledge of what the sourcing team had said or done in its dealings with suppliers of fabrics to EWM. 99.I must assume that when Ms Blythe and others at EWM inspected each of the Visage, Cingo and Bengal Knittex Fabric they noticed the similarities with the Wave Fabric that are illustrated in Annexes 2-5 of this judgment. It is certain that they were aware of no other fabric displaying such similarities. In closing Mr Harbottle argued that they would not have stretched the fabrics, so the similarities would not have emerged. This implies a surprisingly cursory handling of the fabrics. 100.I think it is likely that when Visage was provided with a sample of the Wave Fabric and asked for something similar, Visage understood that something very similar was required. There is no direct evidence that Cingo and Bengal Knittex were provided with a sample by EWM, but Ms Blythe could not know because she was not part of the sourcing team. The similarities between the fabrics suggests to me that they were. 101.Given that each of Visage, Cingo and Bengal Knittex were probably invited to supply a fabric very similar to the Wave Fabric, it can have come as no surprise to EWM that this was what they got. I think it is likely that Ms Blythe and possibly others at EWM were either prepared to take the risk that EWM was infringing Response’s rights, or alternatively they adopted such a narrow view of those rights that they believed there would be no infringement. But the test is not what Ms Blythe thought, it is what a reasonable person in her position would have thought. 102.In my view, the similarities between the Wave Fabric on the one hand and each of the Visage, Cingo and Bengal Knittex Fabrics on the other, would have been apparent to a reasonable person and would have led that person to believe that dealing in the latter fabrics would be in breach of rights likely to be held by Response. EWM’s sales of the Visage, Cingo and Bengal Knittex Fabrics were all secondary infringements.