Utility Models and Intellectual Creativity

The case “Plastipren SCA c/ Necho SA s/ Cese de uso de modelos y diseños. Daños y perjuicios. Causa N° 5322/2011” refers to utility model AR037113B4, which covered a reversible bag for waste classification and collection.

The Court of Appeals confirmed the validity of the utility model, as requested by the plaintiff, and ordered the defendant to pay ARS 400,000 in damages plus compensatory interests, as of the filing date of the complaint.

This lawsuit was filed in 2011, and therefore the applicable provisions are those of the Patents and Utility Models Law No. 24,481, in force until the amendments introduced through Law No. 27,444. The plaintiff, Plastipren, had filed a complaint against the defendant, Necho, seeking that the use of the utility model AR037113B4 be discontinued, and claiming a compensation for damages, estimated in 10% of Necho’s sales. Although in the reply to the complaint Necho admitted having sold bags with the same functional features as those claimed by Plastipren, they filed a counterclaim requesting the nullity of the utility model.

The court of first instance declared the cease-of-use claim moot, since the utility model AR037113B4 had lapsed on October 18, 2012.

As for the validity of the utility model, the Court of Appeals held that this kind of IP right protects “the new shape of an object that has a practical use” and objects improved from a functional standpoint. The Court also sustained that Plastipren’s utility model met these requirements: the new shape, the useful and lawful purpose, and the practical use of an object. Moreover, the Court highlighted the main difference between a patent and a utility model: the latter does not require an inventive step. Nonetheless, the ruling clarifies that there must be a certain degree of intellectual creativity reflecting “a better and new use in the function for which the object covered by the utility model has been created”.

Finally, the Court of Appeals remarked that, when determining damages, it took into account the fact that Plastipren had no prior history of manufacturing or selling waste bags, and that it had not been possible to irrefutably establish the number of infringing products sold by Necho, nor the estimated earnings.