Design Ownership Disputes and Corrections

Owning a registered Australian design gives you exclusive rights to control how your design is used, licensed, and enforced in Australia. But sometimes, disputes arise over who actually owns a design.

Types of Ownership Disputes

IP Australia generally deals with three categories of ownership disputes-

• Disputes about whether or how a design application should proceed (sec 29)– These include disagreements between joint applicants or cases where a third party claims they should be included as an applicant.
• Disputes about entitlement to a registered design (sec 52)– These usually involve challenges brought after a design has been registered, where someone claims that they, though not the recorded owner, were entitled to be listed.
• Disputes about recording a change of ownership before registration (sec 29 and sec 30)– Assignments and ownership transfers are usually straightforward, but if a dispute arises, the Registrar can step in.

Joint Applicant Disputes (sec 29)

Sometimes, joint applicants cannot agree on how to move forward with a design application. For example, one party may want to proceed while another refuses to sign documents. The Registrar can resolve this by allowing the application to proceed with the consent of the majority, deleting an applicant who is blocking the process, or requiring all applicants to agree, in which case the application will lapse if they cannot.

While rare, these disputes highlight the importance of clear agreements between collaborators before filing a design application.

Third-Party Claims During the Application Stage (sec 29)

A more common dispute is when a non-applicant asserts that they should be entitled to apply for the design, either alone or jointly with the applicant.

This process is tricky because design applications are not open for public inspection. A person may strongly suspect their design has been used, but without access to the application details, it can be difficult to prove entitlement. In such cases if parties agree, documents can be exchanged privately. Whereas if they cannot, the Registrar decides what limited documents (if any) can be inspected under sec 61.

If the Registrar finds that a third party is entitled, the application can be amended to include or replace applicants. A new application does not need to be filed.

Ownership Disputes After Registration (sec 52)

Ownership disputes over registered designs often arise after the design has already been formally recorded. Under section 52 of the Designs Act, an individual may request the Registrar to revoke a design if they believe the registered owner was not entitled to the design at the time of registration, or if another person should have also been listed as an owner.

The process begins with a formal request for revocation. A third party initiates this by filing an application under section 51, accompanied by a statement outlining the grounds for their claim. Following this, both parties enter the evidence stage, where they submit declarations and supporting documentation to substantiate their respective positions.

Once the evidence has been reviewed, a hearing is conducted. The Registrar listens to both sides and evaluates the claims to determine who is legally entitled to the design. If the Registrar concludes that the registered owner was not entitled, the design may be revoked.

That said, if revocation occurs, the rightful owner is not left without recourse. They may reapply for the same design under section 55, and crucially, they retain the original priority date. This provision helps ensure that their rights are preserved, even in the aftermath of a contested registration.

Disputes Over Assignments and Ownership Transfers (sec 30)

Ownership changes to a registered design, such as through assignment or inheritance, are generally straightforward to record. These updates help ensure that the Designs Register accurately reflects the current rights holder. However, disputes can occasionally arise, complicating what is otherwise a routine process.

Common issues include errors in assignment documents, such as incorrect names or missing details. Disagreements may also stem from partial or time-limited assignments, where the scope or duration of the transfer is unclear. Another point of contention is whether a co-owner can assign their share of the design without the consent of the other co-owners. Additionally, competing claims may emerge between earlier and later owners, especially if multiple transfers have occurred without proper documentation.

When such disputes arise before the design is registered, they are addressed under section 29 of the Designs Act. If the conflict surfaces after registration, it may fall within the scope of section 52, which governs post-registration ownership challenges. In either case, resolving these disputes is essential to maintaining the integrity of the design rights and ensuring that enforcement actions are taken by the rightful owner.

Common situations where ownership disputes arise

Several recurring scenarios give rise to disputes-

• Employer vs employee– Generally, if a design is created in the course of employment, the employer is entitled to it. But if an employee designs something unrelated to their duties in their own time, they may retain ownership. Cases such as Metroll Queensland Pty Ltd v Collymore have explored these boundaries.
• Directors’ obligations– Company directors who create designs relevant to the business may owe ownership rights to the company, even if developed outside formal work hours.
• Former employees– Employers sometimes challenge applications filed by ex-employees shortly after leaving, arguing the design was developed while still employed.
• Collaborations and group efforts– Where multiple people contribute, ownership may depend on whether they were working for the same employer, or whether the contribution was part of a true collaboration.
• Breach of confidentiality– If a design is disclosed in confidence and later used without permission, ownership may be disputed.

These examples show how facts such as employment contracts, business duties, and collaboration agreements can play a central role in determining ownership.

How does the registrar handles disputes?

The Registrar plays an active and central role in resolving disputes related to registered designs. The process typically begins with evidence collection, where each party submits formal declarations and supporting documentation to substantiate their claims. This stage is crucial for establishing the factual basis of the dispute.

Access to documents is another important aspect, though it can be limited, i.e. particularly in cases involving unpublished applications. This restriction can make disputes at the application stage more challenging, as parties may not have full visibility into the contested material.

Hearings form the next phase, where both sides present their arguments before a hearing officer. The officer has broad discretion in managing the proceedings, including setting timelines, determining admissibility of evidence, and guiding the overall conduct of the hearing.

In addition to overseeing the hearing, the Registrar holds further powers to support the resolution process. These include issuing notices that compel the production of documents and, in rare instances, permitting the cross-examination of witnesses to clarify contested facts.

Following the hearing, the Registrar may issue a decision that results in the revocation of the design, correction of ownership details, or dismissal of the claim altogether. Written reasons for the decision are typically published, ensuring transparency. If a party is dissatisfied with the outcome, they may appeal to the Federal Court, which provides an avenue for further review.

Revocation and Re-Registration

If a design is revoked following an ownership dispute, the rightful owner is not left without recourse. They can file a new application for the same design under sec 55, retaining the original priority date and term. This ensures that ownership disputes, though disruptive, do not necessarily destroy the commercial value of a design.

Work with us

For applicants, the safest path is prevention, making sure ownership is clear from the outset. But if disputes arise, it’s important to understand how the system works, the evidence required, and the potential outcomes. With the right legal guidance, you can protect your entitlement and secure your design rights, even if ownership is contested along the way.

Contact us now for a free consultation.