ZHANG v SEALEGS INTERNATIONAL LIMITED [2019] NZCA 389

ZHANG v SEALEGS INTERNATIONAL LIMITED [2019] NZCA 389 [27 August 2019]IN THE COURT OF APPEAL OF NEW ZEALANDI TE KŌTI PĪRA O AOTEAROACA454/2018[2019] NZCA 389BETWEEN YUN ZHANGFirst AppellantORION LIMITED AND ORION MARINELIMITEDSecond AppellantsSMUGGLER MARINE LIMITEDThird AppellantDARREN LEYBOURNEFourth AppellantVLADAN ZUBCICFifth AppellantDAVID PRINGLESixth AppellantSTRYDA MARINE LIMITEDSeventh AppellantAND SEALEGS INTERNATIONAL LIMITEDRespondentHearing: 19 and 20 February 2019Court: French, Cooper and Brown JJCounsel: J G Miles QC and A K Hyde for AppellantsB P Henry, K M Elcoat and S S Singh for RespondentJudgment: 27 August 2019 at 3.00 pmJUDGMENT OF THE COURTA The appeal is allowed. The orders in the High Court are set aside.B The respondent must pay the appellants one set of costs for a complex appealon a band B basis plus usual disbursements. We certify for second counsel.____________________________________________________________________Table of ContentsPara NoIntroduction [1]Relevant facts [6]Mr Bryham's idea [6]Two concept boats [9]Prototype boat 1 [13]Mr Leybourne and Mr Zubcic join Sealegs [15]Prototype boat 136 [18]The SL100 project [21]Mr Leybourne forms Orion Marine Ltd [22]The 2015 Shanghai Boat Show [28]Smuggler Marine and Sealegs [29]Prototype IKA11 [32]Orion provides its amphibious system to Smuggler [33]Sealegs' intellectual property rights [39]NZ Patent 526705 [40]Design registration 403199 [43]Copyright [46]The changes in the formulation of Sealegs' copyright claim [47]The pleaded claim [47]Sealegs' case at trial [50]The report of the conference of experts [53]The High Court judgment [57]Scope of appeal [62]The relevant copyright work: identification [64]Ideas and their expression: patent vs copyright [72]Were the prototypes "models"? [95]Was the arrangement of features original? [106]Infringement — principles [128]Objective similarity? [137]The High Court's finding [137]Errors in approach [138]Functional resemblance — the third error [141]Dimensions and geometry — the fourth error [146]Our analysis [154]The relevance of an engineer's perspective [164]A failure to take account of the appellants' expert evidence? [171]Undue reliance on credibility issues? [178]Result [181]REASONS OF THE COURT(Given by Brown J)Introduction[1] Sealegs International Ltd (Sealegs) asserts copyright in models1 in the form ofprototypes of its arrangement of known mechanical components comprising the wheelassemblies of its amphibious system externally located on the hulls of boats.The copyright is said to be the expression of the novel idea to place wheel assemblieson the exterior of a boat hull which are retractable to visible positions outside the hullform, thereby providing a solution to the problem of amphibious capability for smallcraft.[2] Sealegs claimed that its collocation-based copyright was infringed by theamphibious system developed by the second appellants (Orion). It also contended thatOrion had infringed Sealegs' registered design. However it elected not to sue forpatent infringement.[3] In the High Court Davison J held that the arrangement of componentscomprising the central core of the Sealegs amphibious boat system was highly originaland was appropriated by the design of the Orion amphibious system.2 Differencesidentified between the systems were discounted because they did not alter the legassemblies' fundamental functionality. Sealegs' registered design claim wasdismissed.[4] The appellants challenge the High Court's findings of originality and objectivesimilarity, and the rejection of their claimed independent design path. They contendthat the judgment fundamentally misconceives the law of copyright with theconsequence that Sealegs has been granted an unprecedented monopoly in acollocation of known functional components, untethered to any visual expression.While acknowledging that they adopted Sealegs' idea, they maintain that the Orion1 Within para (a)(i) of the definition of "artistic work" in s 2(1) of the Copyright Act 1994.2 Sealegs International Ltd v Zhang [2018] NZHC 1724 [High Court judgment].arrangement was not a copyright infringement but inevitably derived from functionalconstraints.[5] Hence in the context of a collocation-based copyright claim comprising knownfunctional components and the application of well-known engineering mechanismsand principles, the parties' cases trod the notoriously ill-defined boundary betweenideas and their expression.Relevant factsMr Bryham's idea[6] Mr Maurice Bryham, an Auckland beachside resident, was inspired to designand construct an amphibious system comprising three supporting legs and poweredwheels which when attached to a powerboat enabled it to be manoeuvred while onland, driven from the beach into the water and the legs then retracted when the boatwas afloat. Such a product, which would provide the convenience and safety of a boatthat could be launched and returned to land without the occupants having to leave theboat, was expected to appeal to the high end of the recreational boating market.He named the design "Sealegs" and incorporated the respondent on 10 May 2000.All his work on the prototypes for the Sealegs amphibious boat system was undertakenas its employee.[7] Mr Bryham explained why he considered his idea was unique:4 There are many, many ways to achieve a design of a three-leggedamphibious boat system. These include the use of hull recesses withopening flap doors, vertically lifting and lowering wheels, or havingwheels that deploy from the side of the hull. The decision I made wasunique at the time, as the way I conceived to achieve the retraction ofwheels from a boat is to have the wheels, the legs, the retractionactuator and the front steering actuator all located outside the hullleaving the boat streamlined in the water when underway.5 Other solutions are to have the wheels, legs, retraction actuator, and/orsteering actuator partly inside and partly outside of the boat hull.The combinations available to a designer are many and varied.6 I thought it would be better to have the legs and retraction assemblyattached to the outside of the hull with the legs and the retractionactuators all externally mounted. When the legs were retracted, thewheels would be lifted and stored above the boat waterline.This concept maintained the integrity of the hull, but resulted in theexternal attachments of the legs, wheels, retraction actuator and frontsteering actuator.Hence his idea was not merely an amphibious boat, as the written submissions forSealegs suggested, but rather, as his reply brief described, the unusual design decisionto have "all the motorised wheels and amphibious assemblies located outside thewatertight hull in both land and water positions".3[8] Mr Bryham also experimented with another design in which the legs whenretracted were substantially concealed and enclosed within recesses built into the hullof the boat. He obtained design registration 403199 in relation to that design.However he did not seek registration of the design which was the subject of thecopyright claim.Two concept boats[9] The first stage in Mr Bryham's design endeavours was known as "conceptboat 1". He purchased a 4.7 metre rigid inflatable boat (RIB) and built woodenmock-ups of legs and wheels to create a pattern for the external legs and to work outthe placement of the leg pivot points and actuator connection points on the hull, aswell as the geometry of the movement they were required to perform in order to extendand retract externally of the boat. He then had the pattern of his wooden mock-upsreplicated by a stainless-steel fabricator. The front and rear legs on concept boat 1were lifted out of the water manually and the rear wheels were electrically driven.The front wheel was steered by means of an external actuator. Having assembled thelegs and attached the amphibious leg system onto the RIB in his home garage, he testedconcept boat 1 by driving it from his garage to the nearby beach and into and out ofthe water.[10] Mr Bryham and Sealegs further developed the design by means of "conceptboat 2", again purchasing a standard RIB for modification. The fourth appellant,Mr Leybourne, then the owner and principal of Central Hydraulics Services Ltd, wasengaged to provide advice regarding the hydraulics system required to power the3 Emphasis in original.actuators which would extend and retract the legs and to power the hydraulic motorsused to drive the rear wheels.[11] The modifications introduced by concept boat 2 were described in theHigh Court judgment in this way:[17] The concept boat 2 model had the hydraulic retraction system of thefront leg located inside the hull. Part of the front wheel steering system wasalso contained inside the hull. The front wheel was secured by an inverted"U" shaped fork, and the rear legs were retractable by means of an externalhydraulic lift cylinder. In the course of its development the system initiallyused electric motors to drive the wheels, then hydrostatic drive, thenmechanical drive, before hydraulic power was finally selected to drive thewheels. The hydraulic drive system for the rear wheels used a hydraulic motorlocated inside the hull with chains running inside the rear legs, which hadlarger wheels and tyres with a more defined tread than had been usedpreviously on concept boat 1.[12] Informed by the development of concept boat 2, Sealegs and Mr Bryhamproceeded to construct what became "prototype boat 1", the first of three prototypeswhich ultimately formed the basis of the copyright claim, the other two beingprototype boat 136 and prototype IKA11. We will refer to them collectively as thethree prototypes.Prototype boat 1[13] In the course of the development of prototype boat 1 Fulcrum Solutions Ltdwas engaged to produce engineering drawings of alternative development pathwaysthat could be adopted, including the partly internal steering arrangement used onconcept boat 2. However Mr Bryham decided that that arrangement, which requireda number of additional mechanical parts, was too complicated. He reverted to hisoriginal design employed in concept boat 1, with the front leg lifting actuator, steeringactuator and rear leg lifting actuators all located external to the hull. UtilisingFulcrum's design computer, drawings were prepared to Mr Bryham's specificationswhich were then entered into the SolidWorks computer-aided design (CAD) programto produce a series of computer-generated images of the design showing what amanufactured boat would look like.[14] Production drawings were prepared based on the prototype boat 1 and the firstproduction boat was sold on 30 April 2004. A subsequent modification to the designof the front leg was described in the judgment in this way:4As already noted, the initial design of the front leg had the wheel secured inan inverted U-shaped fork. The U-shaped fork was found to be subject tobearing and shaft failure and, because it used a different wheel from that onthe rear legs, it also meant that a boat owner would need to have two differentwheels for use as spares. Mr Bryham also wanted to produce a moreaesthetically pleasing and sculpted look for the front leg, and decided that aninverted L-shaped single arm with a rectangular cross-section design wouldbe an improvement. An engineering company was engaged to construct aprototype of this new front fork and once approved, production drawings ofthe new fork were commissioned by Sealegs. The new inverted L-shaped forkwas brought into production and became a feature of all Sealegs boats soldfrom 5 September 2005.Mr Leybourne and Mr Zubcic join Sealegs[15] Mr Leybourne joined Sealegs in April 2004, initially becoming involved in theconstruction, repair and servicing of Sealegs boats but in 2006 shifting fromday-to-day operational work to project management. This included managing theestablishment of an in-house hull fabrication process. When in mid-2010 Sealegsdecided to bring the manufacture of machined components in-house, Mr Leybournewas given the role of managing the establishment of that new operation.[16] In the course of that project Mr Leybourne worked closely with Mr Zubcicwho joined Sealegs in February 2008 as a mechanical and design engineer.They recommended the purchase of a new computer-based material requirementsplanning (MRP) program to more efficiently control and manage the productionoperation.[17] The Judge noted that throughout his employment Mr Leybourne wasfrequently critical of the general lack of quality control and assurance in the productionof the Sealegs boats, particularly with reference to the sale of boats intended for usefor commercial applications.5 Mr Leybourne considered the boats and theiramphibious systems had neither been designed nor proven suitable for such purposes.4 High Court judgment, above n 2, at [23].5 At [28].Prototype boat 136[18] Around August 2009 Sealegs decided to develop and introduce a three-wheeldrive system by adding drive power to the wheel of the front leg. Although initiallyresistant, holding the view that the production of quality hulls needed to be prioritisedover the creation of a three-wheel drive system, Mr Leybourne ultimately acceded tomanagement's request to take responsibility for the project.[19] Prototype boat 136, so called because the boat used as the basis fordevelopment was Sealegs' 136th production boat, was a three-wheel drive version ofthe standard Sealegs production boat. The consequence of the introduction of powerto the front leg was that, as the boat transitioned from floating to being supported onits legs when it made contact with the beach or ramp, it would be driven by the frontwheel instead of being pushed by the outboard motor until the rear driving wheels hadmade sufficient contact with the ground to gain traction and provide forward motion.[20] The introduction of a hydraulic hub motor to power the front wheel requiredredevelopment of the hydraulic system and its controls. A further modification was anew differential lock system and a redesigned front steering arm. However apart fromthose features prototype boat 136 was substantially the same as prototype boat 1.Once approved for production the production drawings were prepared by Sealegs' ownengineering and computer design staff, principally Mr Zubcic. The product wasreleased to the market in 2010. The three-wheel drive system known as "System 60"became an option for customers to purchase. It proved very popular and the fiftiethSystem 60 was sold on 31 May 2011.The SL100 project[21] In mid-2010 Sealegs initiated a project to develop a new heavy-lift Sealegssystem for use on larger craft of around 9 metres in length and weighing5000 kilograms. It was initially known as "Project 100" but was subsequently namedSystem 100 (SL100). One of the design engineers recruited for the project wasMr Andrew Percival whose manufacturing business had assisted in the design andmanufacture of parts for prototype boats 1 and 136. Because of his hydraulicsexpertise Mr Leybourne became involved in Project 100, undertaking the calculationsof the hydraulic requirements and specifications for the proposed craft. Thesecalculations dictated the choice of hydraulic components and those choices in turndictated aspects of the design of the functional leg assemblies' components. Howeveras noted below, Project 100 was a stop-start affair and in July 2011 it was suspendedbecause of funding issues.Mr Leybourne forms Orion Marine Ltd[22] Mr Leybourne left Sealegs on 30 November 2011, he claimed with no plansfor any other employment. However once back working in the hydraulics field itoccurred to him that there were new concepts that could be applied to amphibioussystems.[23] Mr Leybourne deposed that in mid 2012 he received a surprise visit fromMr Zhang (the first appellant) who some years earlier as a student had lived withMr Leybourne and his family on a homestay basis. Mr Zhang claimed to be a directorof one of his family's companies in China formed in 2001 which manufactured andmarketed amphibious craft known as "Surfcon". In the event on 28 September 2012Mr Leybourne and Mr Zhang incorporated Orion Marine Ltd with the intention ofdesigning and manufacturing a new amphibious system. Mr Zhang who provided thefunding was the sole director and shareholder. He moved to New Zealand in 2015 andMr Bryham provided a letter in support of his residence application.[24] Mr Zubcic accepted Mr Leybourne's offer of employment at Orion andresigned from Sealegs on 2 February 2013. He commenced work on the design anddevelopment of Orion's new amphibious system project which became known as theS25-4WD. An early task was the preparation of sketches of a wheel with an off-setrim which would enable a hub motor to sit substantially within the wheel.This directed the effects of weight and force on the motor to the optimal positioncompared with the sub-optimal location of weight and forces upon a motor connectedto a standard centre rim wheel.[25] In early 2013 Mr Bryham, who by then knew that Mr Leybourne was settingup a new business, contacted Mr Leybourne and advised that Sealegs wanted to beOrion's first customer to assist with various projects including the SL100. A detailedwritten design brief was negotiated whereby Orion was to design, manufacture, installand validate an amphibious system suitable for craft up to 6000 kilograms grossvehicle mass (GVM).[26] The judgment describes the way in which Orion managed concurrently its ownproject and the Sealegs design brief:[57] When Mr Leybourne for Orion accepted Sealegs' engagement to workon SL100, he realised that Orion would not have the engineering and designresources sufficient to develop its own amphibious system while alsoundertaking the SL100 project. Mr Zubcic was to be responsible for thedesign engineering of Orion's new amphibious system project, and soMr Leybourne employed Mr Percival to take on the design engineering forSL100. Recognising the conflicting interests of Orion and Sealegs,Mr Leybourne organised for Mr Zubcic and Mr Percival to occupy separateoffices, while he "floated between both projects".[58] Because of the increase of the GVM from the 5000kg applicable tothe Project 100 barge to the 6000kg GVM for SL100, the engineering designprocess had to start again from scratch. This applied not only to the hydrauliccalculations undertaken by Mr Leybourne, but also to all the components thatMr Percival was required to design for SL100. In terms of the appearance ofthe leg assemblies, Mr Bryham wanted the design to maintain the existingcurved form of the existing Sealegs assemblies. While Mr Percival was theprincipal design engineer during the early phase of SL100's development, hedid not have the expertise necessary to run the FEA (finite element analysis)computer simulation system which was used to analyse the strength ofdesigned components. Consequently Mr Zubcic operated and ran the FEA ofMr Percival's component designs during 2013, and in doing so inevitablybecame familiar with the SL100 components that Mr Percival had designed.[27] Although by September 2013 Orion was making progress with thedevelopment of SL100, Sealegs suspended further development because of fundingissues. The SL100 project was resumed in early 2014 and Orion continued to workon its development until around the end of July when work stopped again because ofSealegs' funding issues. In February 2015 Mr Bryham again contacted Mr Leybourneregarding the resumption of the SL100 project.The 2015 Shanghai Boat Show[28] At the April 2015 Shanghai Boat Show Mr Bryham viewed the Surfconamphibious rescue craft equipped with a retractable three leg amphibious system.He considered it to be a substantial copy of the Sealegs system and a discussion tookplace between Mr Bryham and Messrs Leybourne and Zhang about whether the twocompanies and their products could exist together in the market. Mr Bryham saidMr Leybourne told him that the Surfcon craft would not be sold outside the Chinesemarket. That information together with his view that the Surfcon craft looked inferiorto the Sealegs system were factors leading to Mr Bryham's view that Sealegs shouldendeavour to negotiate a distribution agreement notwithstanding his concerns aboutcopyright infringement. Later in April 2015 Sealegs forwarded a "Sealegs IntellectualProperty Agreement" to Mr Leybourne and Orion Marine but it does not appear that itwas executed or returned by Orion Marine.Smuggler Marine and Sealegs[29] Smuggler Marine Ltd (the third appellant, "Smuggler") owned and operatedby Mr Pringle (the sixth appellant) and his wife is a successful boat manufacturingbusiness whose product range includes RIB boats between four to 11 metres in length.In 2011 or 2012 Sealegs and Smuggler reached agreement whereby Sealegs wouldsupply its amphibious leg kits together with technical drawings and instructions toenable Smuggler to install the systems on the hulls of its craft. As part of the unitpurchase price of $65,000 plus GST Sealegs staff undertook the commissioning workto make the systems operative. Sealegs committed to supplying its system toSmuggler for a term of five years.[30] There were difficulties in the companies' relationship and in early 2015 Sealegsproposed a significant change to the terms of trade including a price increase to$75,000, Smuggler being required to pay for the on-site installation support providedby Sealegs and Smuggler being required to purchase and pay for five kits immediatelyand a further five kits in six months' time. Smuggler was not willing to accept theproposed terms and began actively looking for an alternative to the Sealegs system.[31] In around April 2015 Mr Pringle and Mr Leybourne discussed the possibilityof Orion producing a three-wheel drive amphibious system for installation in theSmuggler boats in place of the Sealegs system. However Orion was not in a positionto do so immediately because it was fully committed to the completion of the SL100project.Prototype IKA11[32] SL100 was installed on a prototype craft known as "IKA11" and displayed atthe Auckland On Water Boat show in September 2015. In October 2015 Orionfinished working on SL100. The Sealegs boat IKA11 fitted with the prototype SL100system was sold for $500,000 and shipped to a purchaser in the United States ofAmerica that month.Orion provides its amphibious system to Smuggler[33] Anticipating Orion's work on the SL100 coming to an end, in October 2015Mr Leybourne resumed discussions with Mr Pringle regarding the three-wheel drivesystem Smuggler had sought. Mr Pringle provided Mr Leybourne and Mr Zubcic witha detailed drawing of Smuggler's 7.5 metre mid-cabin RIB craft. As the Judgeexplained:[115] Mr Leybourne further said in evidence that Orion had looked at theSmuggler 7.5 metre hull to see how an amphibious system would work, andused the geometry applicable to that Smuggler hull as the basis from which itdeveloped its design. He explained that they wanted to use the same methodof attaching the legs to the hull as they had developed for the Orion S25-4WDsystem. Referring to himself, Mr Zubcic and Mr Pringle, he says that theyalso wanted to use the same rear assemblies as had already been developed forthe Orion four-wheel drive system, and accordingly Orion providedMr Pringle with drawings of its design to enable Smuggler to modify its hullto accommodate the Orion system for attaching and connecting their legassemblies to the hull.[116] Mr Leybourne further explained in his evidence that having examinedthe Smuggler 7.5 metre craft and its specifications, he found that it was verysimilar to Orion's ARC600 rescue craft in terms of size and weight, with theresult that the three-wheel system Orion produced for Smuggler could havevery similar specifications. Mr Leybourne says that in the interests of savingtime, Mr Pringle had to make his boats work using the rear leg assemblies thatOrion had already produced for the rescue craft, and which were designed forcraft weighing 2,500kg. However, the Orion front leg with its two wheels hadbeen designed for a barge type of craft and after some initial consideration itwas soon decided that it would not be suitable for fitting to high-endrecreational craft such as the Smuggler boats, where aesthetics was animportant consideration. Rather, it was decided that the only realistic optionthey had was a front leg assembly with one wheel.[117] Mr Leybourne said that as the existing Orion rear leg assemblies,hydraulic power unit and user controls were suitable for the Smuggler craft,the only thing that Orion needed to design was a new front leg assembly withone wheel. He explained their approach as wanting the new front assembly tobe based on the Orion four-wheel design as much as possible, as that wouldreduce development time and provide Smuggler and Mr Pringle with a promptsolution.[34] Mr Zubcic proceeded with the design of a new single wheel front leg assemblyand its component parts during November and December 2015. During this periodthere was regular communication between Mr Pringle and Mr Leybourne including anumber of emails referring to obtaining advice from a patent lawyer with reference tothe implications of a Sealegs patent.6[35] The judgment traverses in detail the several communications involvingSmuggler, Orion and Sealegs during 2016, noting that it was apparent thatMr Leybourne and Orion endeavoured to conceal from Sealegs their involvement withSmuggler and that they were developing an Orion amphibious system for Smuggler.7In July 2016 Orion issued its first tax invoice to Smuggler for the supply of a "S25-3WD Amphibious System" at a price of $65,000 plus GST. In August 2016 Smuggleraccepted written orders for amphibious craft the specifications for which referred to"S25 wheels, engine, all systems for powering amphibious operation ".[36] In its promotional material published in the September 2016 issue of BoatingNew Zealand magazine, Smuggler announced it would be unveiling a "very special"craft at the September 2016 Auckland On Water Boat Show which it said was"destined to be a game-changer". Mr Allen of Pipers Patent Attorneys (Pipers) whohad been engaged by Sealegs visited Smuggler purporting to be interested inpurchasing a Sealegs type boat. Mr Pringle showed him photographs of a newSmuggler boat and boats under construction in the workshop. Mr Allen said that hewas told by Mr Pringle that the new amphibious system had been designed by one ofthe head designers from Sealegs who had left Sealegs' employment to design the newsystem. He also said that Mrs Pringle told him that the Smuggler boats with the newamphibious system would be on display at the Auckland Boat Show in late September2016.[37] On 9 September 2016 Sealegs commenced proceedings for an injunction butits without notice application on a Pickwick basis seeking orders restraining the6 At [120]–[124].7 At [130].exhibition of the Orion amphibious products at the boat show was declined.Mr Bryham viewed the Orion S25-3WD and S25-4WD systems at the boat show andon the basis of his limited view considered the latter to be a copy of the Sealegs portand starboard rear leg assemblies.[38] Our review of the facts is a summary of the very thorough record of events inthe High Court judgment. Because of the conclusions we have reached, it isunnecessary to traverse in detail several other events such as the evidence of MrRedpath concerning Mr Leybourne's possession of a USB stick containing Sealegs'files which the Judge took into account in coming to his credibility findings notedbelow.8Sealegs' intellectual property rights[39] Mr Bryham deposed that Sealegs had three different intellectual property rightsprotecting the design of the Sealegs three-legged amphibious boat system:• NZ Patent 526705;• Design registration 403199; and• Copyright in various works including the three prototypes.NZ Patent 526705[40] During the design and development of concept boat 1 Sealegs engaged Pipersand on 17 December 2001 a first patent application was lodged for an invention for anamphibious vehicle. It appears that further applications were prepared in 2002 and2003 (relating to the retractable leg system).9 Although all the documentation relatingto Sealegs' patent application was not before us, from the response of Mr Allen toquestions from the High Court Judge we infer that patents were obtained in somejurisdictions.10 As earlier noted the evidence demonstrates that Mr Leybourne and8 See [60]–[61] below.9 High Court judgment, above n 2, at [180].10 The drawing of the Sealegs yoke at page 89 of the document bundle has a reference to US PatentNo 7,004,801.Mr Pringle were aware of a Sealegs patent and that they had obtained advice from apatent attorney about its implications.11[41] Included in the case on appeal was a Patent Cooperation Treaty InternationalPreliminary Examination Report, which appeared to question the existence of aninventive step in Sealegs' claimed invention. Mr Allen was cross-examined withreference to that report and it was also referred to by Mr Miles QC in the course ofargument before this Court.[42] However issues concerning Sealegs' patents and their validity are not raised bythis appeal. For, as Mr Bryham stated in evidence, while he believed the appellants'design was a patent infringement, because of the impending trial date Sealegs decidednot to add a patent cause of action in the New Zealand claim but to pursue what hereferred to as the simpler copyright infringements leaving the patent to be relied on inthe United States, Australia and other jurisdictions should litigation arise there.Design registration 403199[43] On 23 December 2002 Sealegs lodged an application for a registered designwhich was published on 16 January 2003 and which following subsequent renewalshad a final expiry date of 23 December 2017. The Statement of Novelty stated thatthe novelty: resides in the features of shape and configuration of the boat as shown inthe accompanying representations. The boat has a retractable undercarriagesystem, and the accompanying representations show the appearance of theboat with its wheels up, and the appearance of the same boat with its wheelsdown.[44] The accompanying representations were computer-generated images showingthe boat as having a retractable undercarriage system and demonstrating both thewheels-up and wheels-down positions. When retracted the front wheel was almostentirely concealed within a recessed cavity located at the bow between the inflatablepontoons while the rear legs when retracted were almost fully covered and enclosedwithin a recessed cavity at the rear of each of the pontoons.11 At [34] above.[45] Sealegs' cause of action based on the registered design failed. The Judgeconcluded that, unlike the recessed rear legs and wheels shown in the registered designimages, the wheels on the alleged infringing boat when retracted remained entirelyvisible and obvious. While the overall impression was one of broad similarity, the twocraft were not substantially the same in appearance.12Copyright[46] The fifth amended statement of claim dated on 25 August 2017 and filed closeto trial asserted ownership of copyright in a substantial number of artistic works whichcame into existence in the course of the history of the development of Sealegs'products. The works included both concept boat 1 and concept boat 2, artistic workscomprising drawings and production drawings in respect of componentry for the threeprototypes and the prototypes themselves, as well as other artistic works in the natureof models, namely a prototype single billet hydraulic lift cylinder, a prototype frontarm for front retractable leg assembly, prototype "project X", prototype "electricSealegs" and prototype "the barge". Given the course which this litigation took, it isnecessary to focus in some detail on the copyright allegations in relation to the threeprototypes.The changes in the formulation of Sealegs' copyright claimThe pleaded claim[47] The fifth amended statement of claim was a long and complex documentcomprising four parts:(a) an orthodox statement of claim pleading four causes of action ofcopyright infringement;13(b) seven schedules (A to G) under the heading "Particulars of modelcopyright features";12 High Court judgment, above n 2, at [470].13 The second to fifth causes of action. The first cause of action was for infringement of theregistered design.(c) two schedules (1 and 2) under the heading "Particulars of features ofthe plaintiff's artistic works the defendants have substantially copied";and(d) 147 pages of drawings, production drawings, computer generatedrenderings and photo images, prefaced by a 13 page index headed"Particulars of Artistic Works and Models pages 1–147 attached to thefifth amended statement of claim" (the drawings bundle).Various paragraphs in the pleading proper referred to the schedules and to particularpages in the drawings bundle.[48] Schedules A and B listed the features of the front and rear leg assembliesrespectively of prototype boat 1. Subsequent schedules similarly described thefeatures of prototype boat 136 and prototype IKA11. The differences from schedulesA and B reflected the changes made to the second and third prototypes as noted at[19]–[20] and [21] above.[49] The tenor of the pleading was an assertion of copyright in relation to individualfeatures of the front leg assemblies (in schedules A, C, E and F) and the rear legassemblies (in schedules B, D and G), and an allegation that copyright in those severalfeatures had been infringed (in schedules 1 and 2).Sealegs' case at trial[50] However at trial the nature of Sealegs' copyright claim changed verysignificantly. Claims to copyright in individual components were not pursued.The claim was confined to one which had not been pleaded namely an arrangement orcollocation of unoriginal features. Sealegs' written opening described the copyrightwork in this way:4.1 The copyright work(s) are a combination of features that were placedin the combination by Maurice Bryham, an employee of the plaintiff.The combination of features were placed together after a series ofmodels were made and tested.4.2 The features are all known, but not in the combination the plaintiffachieved.4.3 In this case the quality of the design is the original way MauriceBryham combined the known features to develop retractable front andrear legs assemblies for an amphibian vessel. 4.4 The combination of the features are defined in the fifth amendedstatement of claim in schedules A, B, C, D, E, F and G.[51] That the claim at trial was so confined is apparent from the Judge's observationin the context of his discussion of the subject of originality:14[203] It is plain from the decisions in Bonz Group (Pty) Ltd v Cooke andHenkel that copyright may arise in a collection of individual features whichare not in themselves original and which would not attract copyright ifassessed on their own. This is because the work's originality lies in the skilland labour required to arrange or collocate those features.(Footnotes omitted.)[52] Thus the assertion of copyright was limited to the manifestation in the threeprototypes of an arrangement or collocation of known features,15 features which werenot individually the subject of a copyright claim. As the Judge noted:[208] The plaintiff says that the copyright works are an arrangement offeatures that were placed in their eventual combination by Mr Bryham (as anemployee of the plaintiff) after a process in which a series of models weremade and tested before the final models were produced. The plaintiff saysthat in this case the quality of the design is the original way in whichMr Bryham combined otherwise known features to develop retractable frontand rear leg assemblies for an amphibious craft.[209] The plaintiff accepts that the individual elements or features of the legassemblies may not of themselves have originality in an engineering sense;rather, it refers to the original way in which Mr Bryham combined andarranged those features on a boat to create an amphibious craft with fullyretractable legs, all external of the craft. The plaintiff says that thiscombination of features represents an expression for an amphibious systemwhich was and is entirely original: before Mr Bryham and Sealegs developedthe system, no other such system had been developed, produced ormanufactured anywhere else in the world. There can therefore be nosuggestion that Mr Bryham or Sealegs copied the arrangement of features andcomponents that make up its system from any other design or from any otherperson.14 In the course of addressing the appellants' submission that Sealegs could not claim copyright inan arrangement of individually unoriginal features.15 Of the nature recognised in Bonz Group (Pty) Ltd v Cooke [1994] 3 NZLR 216 (HC); and HenkelKGaA v Holdfast New Zealand Ltd [2006] NZSC 102, [2007] 1 NZLR 577.The report of the conference of experts[53] The reason why a litigant elects to adopt a particular or limited foundation forits claim is a matter for the litigant. The trial court and any appeal court must addressthe claim on the footing on which it is ultimately advanced. However we considerthat the record contains material which provides context for the significant change inthe way in which Sealegs' case was advanced at trial.[54] Each side engaged a number of experts who gave evidence: for Sealegs,Mr Dippie, Mr Bellingham and Mr Allen;16 for the appellants, Dr Field and Dr Gooch.A meeting was held in Auckland on 20 September 2017 attended by Mr Bellingham,Dr Field and Dr Gooch. Subsequently they compiled a joint report which respondedto several questions which the parties had submitted to them. Question 4 askedwhether the features in schedules 1 and 2 to the pleading appeared in the Orionamphibious system (comprising both S25-3WD and S25-4WD). Question 5 directed:5. In relation to each of the features in Schedules 1 and 2 found to bepresent in the defendants' amphibious system, specify:(a) Whether such feature or features could have been derivedfrom the plaintiff's Sealegs system;(b) Or, alternatively, could arise by reason of functional or otherconstraints.6. In each case, specify reasons for the conclusions reached in relationto each of the features listed in Schedules 1 and 2. Specify reasonsfor any similarities and/or differences of opinion.[55] Having identified many of the schedule 1 and 2 features as present in the Orionamphibious system, the report observed that most could have been derived from theSealegs system. However the report also described them as functional.That description of the features may have led to the change in the way Sealegs' casewas advanced at the trial.[56] We refer to further aspects of the joint report in our consideration of the issueof dimensions and geometry.1716 Mr Allen is the Pipers employee referred to at [36] above.17 See [150] below.The High Court judgment[57] The Judge accepted that prototype boat 1, prototype boat 136 and prototypeIKA11 were "models".18 He held that the combination and arrangement of the featurescomprised in the Sealegs amphibious system was the product of substantial skill andlabour and hence an original work within s 14(1)(a) of the Copyright Act 1994.19Indeed the Judge considered that the Sealegs assembly pattern comprised a highdegree of originality.20 He rejected the appellants' contention that certain CADcomputer models were in fact the original expression of the ideas in which copyrightmight subsist, rather than the prototypes themselves.21[58] Turning to the matter of infringement the Judge considered that there wasobjective similarity between:(a) the front leg assemblies on the Orion S25-3WD and theSealegs S60-3WD (the production version of Sealegs prototype boat136);22(b) the rear leg assemblies on the Orion S25-3WD and the SealegsS60-3WD and SL100;23 and(c) the Orion S25-4WD front leg assembly and the Sealegs S60-3WD andSL100;24[59] As a result of their work at Sealegs the Judge concluded that Mr Leybourneand Mr Zubcic knew everything necessary to copy and reproduce the Sealegs systemin their Orion system.25 He explained that unlike most cases where a plaintiff needsto establish that the defendant has had opportunities to copy the copyright work, inthis case Sealegs needed to do no more than prove that Mr Leybourne and Mr Zubcicpossessed a detailed knowledge of the Sealegs system and then used that knowledge18 The Judge did not explicitly consider this issue, but referred to the prototypes as such, for exampleat the heading above [226]: "Ownership: Does the plaintiff own copyright in the three models?".19 At [217].20 At [218]–[219].21 At [220]–[225]. The appellants argued that Sealegs had not pleaded its CAD models as being itsoriginal work, nor had the CAD models been produced in evidence. The Judge also made findingson ownership at [235]–[245].22 At [270] and [284].23 At [277] and [284].24 At [283] and [284].25 At [339].to copy the Sealegs system.26 Plainly in this case the opportunity to copy was availablegiven the appellants' direct involvement with Sealegs' products during theiremployment and subsequently when Orion was engaged by Sealegs to assist in thedevelopment and manufacture of the SL100.[60] The Judge found the evidence of Messrs Leybourne, Zubcic and Zhangregarding the timing and events that preceded the establishment of Orion to beunreliable. The Judge considered that finding was relevant to and informed hisassessment of the reliability and credibility of the appellants' evidence regarding thekey question of whether the Orion leg assemblies were copied from and derived fromthe Sealegs leg assembly pattern.27[61] The Judge held that the Orion design was a copy of and directly derived fromthe Sealegs system and the arrangement of features comprised in the models for whichcopyright was claimed. As he explained in his concluding overview:[421] I reject the defendants' contention that the Orion system wasproduced as a result of the Orion defendants following an independent designpath. While the Orion defendants certainly adopted alternative engineeringsolutions for some visual and functional aspects of the Orion leg assemblies,in each case they related to design details and did not involve changes orsubstantial differences in terms of the composition and arrangement of whatwas the existing and well-known Sealegs pattern.[422] I regret to say that I found that evidence of Mr Leybourne, Mr Zhangand Mr Zubcic lacking in credibility as regards their explanation of thedevelopment of the Orion design and their claim that they did not found theOrion design on the Sealegs pattern. Mr Leybourne's and Mr Zhang's accountof the origins of the Orion business and just when they decided to go intobusiness manufacturing amphibious systems lacks cogency and is in my viewimplausible.Scope of appeal[62] For the purposes of the appeal the appellants did not challenge the High Court'sconclusion that the appellants were not credible or reliable witnesses based on thefindings that:26 At [339].27 At [337].• The idea to start a new amphibious business had beenformulated well before mid-2012 as claimed byMr Leybourne;28• Messrs Leybourne and Zubcic had discussed the new businessventure by early 2012;29 and• Mr Leybourne retained Sealegs design files that came into hispossession fortuitously towards the end of 2011.30[63] Rather, the appellants' appeal was directed to the findings on the subsistenceof copyright, originality, objective similarity and infringement. The agreed list ofissues reflected that focus.The relevant copyright work: identification[64] A cause of action for breach of copyright necessarily involves clear andaccurate identification of the copyright work in respect of which the defendant is saidto have infringed.31[65] The identification of the various artistic works in the fifth amended statementof claim was, despite its complexity, clear and explicit. However Sealegs' case becameanything but clear when, as noted above, in opening Sealegs abandoned reliance onthose pleaded artistic works. The claim proceeded solely by reference to the threeprototypes. The closing address described them in this fashion:Original works5. There are two key prototypes in the chain; firstly Prototype boat 1(CB17), this prototype has a substantial number of improvements tothe prototype single front arm (CB1057) and the prototype singlebillet hydraulic lift cylinder (CB185). Then there was another majorstep forward with prototype boat 136 which added front wheel drive(CB212). This adds a new and very significant feature of All Wheeldrive. It is such a step forward it represents a new copyright. System100, having an industrially engineered look, being a heavy liftexpression of the copyright works and utilized the location of the topof the front lifting cylinder where it attached to the pivot on the hulland included an off-set front wheel rim.28 At [335]–[336].29 At [335].30 At [322]–[324].31 Henkel KGaA v Holdfast New Zealand Ltd, above n 15, at [29].[66] Neither the first nor the second prototype was still in existence but photographsof them were included in the drawings bundle annexed to the pleading. The role ofthe various "features" listed in schedules A to G was described in the closing in thisway:It is prototype boat 1 that is the first copyright work of the plaintiff.The features of the model prototype boat 1 are defined in the particulars.Contrary to the defendants closing submissions, the copyright work is themodel, the features is the quality of the model. It is submitted that the features,if substantially copied, form a breach of copyright. I will go to Henkel shortly.[67] Although Sealegs accepted that the various features in the schedules were allknown, there remained a degree of ambiguity as to their copyright status, as illustratedby the following paragraphs of its closing:44. The plaintiff for the first time in the world's history developed aworkable, commercially successful amphibious system. This systemis protected by their copyright in the features of the front legassemblies and the rear leg assemblies, which is the copyright claimedin the 5th ASOC and particularised for model-prototype boat 1, modelprototype 136, model prototype IKA11.45. On the evidence, it is submitted that the plaintiff has discharged theburden of proof to show on the balance of probabilities that itscopyright models are a "collocation or an arrangement of features"with a very high degree of originality. [68] The precise boundaries of the copyright claim were explored in this Court inthe course of argument on the issue of the appellants' claimed independent design path.After Mr Henry read through [343] to [347] of the judgment, the Court posed thequestion whether the use of hydraulic powered actuators for extension and retractionof the legs was rather an obvious thing to put on such a craft. In responding Mr Henrytook the Court through [348]–[363]. In that part of [363] which Mr Henry read, theJudge addressed the fact that different methods were adopted by the appellants andSealegs to mount the leg assemblies at the bow and transom, observing that thisinvolved no change to the "fundamental functionality of the leg assemblies asinnovated by Sealegs".3232 See [158] below.[69] Although it may have been implicit in the several terms by which the copyrightwork was described in the judgment, namely combination, arrangement, collocationand pattern, it became apparent from a further exchange between the Court andcounsel that the asserted copyright related to the particular order in which the knowncomponents were assembled. In particular, Mr Henry referred to "the sequence of ourpattern" and acknowledged that: the pattern or the arrangement or the sequence comprises the following:one (or more) wheels at the front, two wheels at the back, where they arelocated with the leg mechanism incorporating the components identified inthat sequence shown in Figure 1 [annexed to the High Court judgment].[70] The implications of a copyright claim based solely on an arrangement orcollocation of features not original in themselves were explored by the Supreme Courtin Henkel:33[40] As this case involves copyright which derives from a collocation orarrangement of features which are not original in themselves, it is appropriateto refer to the decision of the High Court in Bonz Group (Pty) Ltd v Cookewhich discussed that topic. A graphic work may qualify for copyrightprotection because its originality lies in the way in which a number of features,which have no originality in themselves, have been arranged or collocated.The following passage from the judgment in Bonz deals with that situation:As Lord Reid emphasised, the correct approach is first to determinewhether the plaintiff's work as a whole is original and protected bycopyright. The second step is to see whether such part as may havebeen taken by the defendant is a substantial part of the plaintiff's work.It is not correct to subdivide the plaintiff's work into its componentparts and ask whether copyright might attach to the individual parts.Copyright, if it exists at all, exists in relation to the work as a whole.For example, an author may have taken six different components forhis work by copying from six different sources. The combination ofthe six components may nevertheless have sufficient originality toattract copyright in the whole.Where, as in this case, the plaintiff relies for its copyright on acollection of individual features, none of which on their own wouldattract copyright, this has ramifications when it comes toinfringement. To infringe in such circumstances the defendant musthave used the same or a substantially similar arrangement orcollocation of the individual features. If the defendant has copied theindividual features but has made its own arrangement of them, thiswill not represent an infringement. That is because the plaintiff hasno monopoly in the individual features as such but only in theirarrangement or collocation. Because the plaintiffs' copyright resides33 Henkel KGaA v Holdfast New Zealand Ltd, above n 15 (footnotes omitted).in the arrangement or colocation the defendant, to infringe, must havecopied the arrangement or collocation or a substantial part thereof.[41] As we observed earlier, it may be relevant for infringement purposesto determine how much skill and labour went into the making of the copyrightwork. This point can have particular relevance in arrangement cases. Theskill and labour which has given rise to the arrangement is what gives the workits originality, and if that skill and labour is not great, another arrangement ofthe same unoriginal underlying features may not have to depart greatly fromthe copyright arrangement in order to avoid infringement. If the level oforiginality in the copyright arrangement is low, the amount of originalityrequired to qualify another arrangement of the same elements as original isalso likely to be low. Substantial reproduction of those aspects of the work inwhich the originality lies must be shown to establish infringement. This isconsistent with the purpose of the law of copyright, which is to recognise andprotect the skill and labour of the author of the copyright work. This point isof significance in the present case. (Footnotes omitted.)[71] Despite the manner in which Sealegs' claim was confined at trial, the Judgeproceeded to find that the Sealegs assembly pattern involved a high degree oforiginality,34 perceiving it to be a counter-intuitive arrangement which yielded a novelsolution to the problem of amphibious capability for small craft.35 The appellantssubmitted that approach was wrong.36 It is desirable in those circumstances to firstdiscuss the conceptual distinction between ideas and their expression before turningto address the steps the copyright infringement analysis requires.Ideas and their expression: patent vs copyright[72] The appellants contended that the judgment fundamentally misconceives thelaw of copyright with the consequence that Sealegs has been granted an unprecedentedmonopoly in a collocation or arrangement of known functional components,untethered to any visual expression. Sealegs' rejoinder was that the appellants'submissions were crafted to distract from the real issue in the case, namely in the lightof Oraka Technologies Ltd v Oraka Graders Ltd37 to what extent the law of copyrightin New Zealand protects the expression of an idea.[73] The appellants' criticism of the judgment was framed in this way:34 High Court judgment, above n 2, at [218].35 At [219], set out below at [113].36 See at [4] above.37 Oraka Technologies Ltd v Geostel Vision Ltd [2013] NZCA 111 [Oraka].1.4 Overall, the respondent's claim must fail because it proceeds on afundamentally flawed basis. The law of copyright does not, andcannot, afford the respondent a monopoly in the arrangement ofcommon functional components, so as to encompass differing visualappearance and engineering design of those individual components.1.5 By finding otherwise, the High Court in its judgment has extended thelaw of copyright in New Zealand beyond its traditional boundariesand, in doing so, blurred the otherwise clear conceptual differences inthe monopolies granted by patent and by copyright. The protectionafforded to the respondent in this case would not be available in anyother Commonwealth jurisdiction, and there is no lawful orreasonable basis for New Zealand to be an outlier in this regard.[74] The appellants' argument draws on the conventional distinction between ideasand the expression of those ideas. Ideas embodied in novel products are protected bythe monopoly conferred by the patent legislation. Mr Bryham conceived what heconsidered was a unique idea,38 one more complex than simply the abstraction of"an amphibious boat" as suggested in Sealegs' submissions. He sought to protect hisidea by a number of patents.[75] The claimed invention was expressed in this way in the first claim of Sealegs'international patent application:An amphibious vehicle having a boat hull which has at least three groundengagement means connected thereto, each ground engagement meanscapable of being disposed in an extended position in which the boat hull maybe supported by the ground engagement means on a ground surface, and eachground engagement means capable of being disposed in a retracted positionin which the amphibious vehicle may be used in water without substantialhydrodynamic interference from the ground engagement means, and whereina forward leg assembly, comprises a first rigid elongate member, one end ofthe first member being pivotally attached to a point on the hull, and the otherend being connected to a ground engagement means supported thereon, so thatthe ground engagement means can be moved between the retracted locationadjacent to the bow of the vehicle and the extended location, in an arc, withoutpassing through any of the primary structure of the hull of the amphibiousvehicle.Subsidiary claims included a powered ground engagement means and a claim: wherein at least one of the ground engagement means comprises at leastone wheel and tyre assembly, and said wheel and tyre assembly, when in theretracted position, protrudes from the hull of the amphibious vehicle in such away that the tyre(s) act as a bumper.38 At [7] above.[76] But, patents aside, the appellants maintained that the idea there described isfree for anyone to use. And they frankly acknowledged that in designing their ownamphibious craft they had taken that idea. Hence there was similarity in the conceptuallevel of the two designs. Furthermore the appellants' design was underpinned by anarrangement which necessarily arose from functional constraints. However what theyhad not done was to replicate Sealegs' expression of that idea in its arrangement of thecomponents comprising the leg assemblies.[77] The authors of Copinger & Skone James on Copyright advocate the view thatit is impossible to define the boundary between the mere taking of general conceptsand ideas on the one hand and copying in the copyright sense on the other, and thatwherever the line is drawn will often seem arbitrary.39 Indeed in Bleiman v NewsMedia (Auckland) Ltd this Court suggested that the conventional distinction betweenideas and the expression of ideas is helpful only up to a point,40 noting LordHailsham's reference to Professor Joad's observation that it all depends what youmean by "ideas".41[78] Bleiman drew attention to the analysis by Prichard J in Plix Products Ltd vFrank M Winstone (Merchants) Ltd of two kinds of ideas:42(a) the general idea or basic concept of a work formed or implanted in themind of its author; and(b) the transformation of the basic concept into a concrete form whereinthe copyright resides.[79] Noting the ill-defined boundary (a phrase coined by Professor Cornish)between general concept and expression, Prichard J went on:4339 Gillian Davies, Nicholas Caddick and Gwilym Harbottle Copinger and Skone James on Copyright(17th ed, Sweet & Maxwell, London, 2016) vol 1 at [7–15]. This Court in Steelbro NZ Ltd v TiddRoss Todd Ltd [2007] NZCA 486 at [108] commented that there is a line between pure ideas andthe expression of them but it is notoriously ill-defined.40 Bleiman v News Media (Auckland) Ltd [1994] 2 NZLR 673 (CA) at 677.41 At 677–678, citing Lord Hailsham's comments in L B (Plastics) Ltd v Swish Products Ltd [1979]RPC 551 (HL) at 629.42 Bleiman v News Media (Auckland) Ltd, above n 40, at 678, referring to Plix Products Ltd v FrankM Winstone (Merchants) Ltd (1984) 3 IPR 390 (HC) at 418–419.43 Plix Products Ltd v Frank M Winstone (Merchants) Ltd, above n 42, at 419.There can be no general formula by which to establish the line between thegeneral idea and the author's expression of the idea. The basic idea (orconcept) is not necessarily simple — it may be complex. It may be somethinginnovative; or it may be commonplace, utilitarian or banal. The way theauthor treats the subject, the forms he uses to express the basic concept, mayrange from the crude and simplistic to the ornate, complicated — andinvolving the collation and application of a great number of constructive ideas.It is in this area that the author expends the skill and industry which (eventhough they may be slight) give the work its originality and entitle him tocopyright. Anyone is free to use the basic idea — unless, of course, it is anovel invention which is protected by the grant of a patent. But no one canappropriate the forms or shapes evolved by the author in the process of givingexpression to the basic idea. So he who seeks to make a product of the samedescription as that in which another owns copyright must tread with care. If hecopies the details which properly belong to the expression and not to the basicconcept, he will infringe the copyright. That is why, when the basic idea isexpressed in a crude, or simplistic form, the potential plagiarist or businesscompetitor can, without offending, come very close to an exact reproductionof the copyright work. But where the expression is ornate, complex ordetailed, then he must keep his distance: the only product he can then makewithout infringing may bear little resemblance to the copyright work.[80] The role of copyright in relation to functional designs has long beencontroversial. The tension was well described in The Copyright Act 1962: Options forReform:44If a manufacturer has seen the existing products, it is very difficult to provethat there has been no copying (or even unconscious copying). This means,in practice, that the first product on the market obtains a virtual monopolyeven though it is not sufficiently innovative or original to qualify for patent orregistered design protection. The problems are exacerbated if the article inquestion is simple or if it is to perform a particular function. For example, anexhaust pipe must fit a particular car. This means that the owner of thedrawing of the exhaust pipe enjoys monopoly rights for 16 years. It isquestionable whether this is in the public interest.[81] Sealegs correctly noted that the law in New Zealand on functionality incopyright is not the same as some other jurisdictions where a decision was made toexclude elements of functionality from copyright protection.45 Similarly theappellants acknowledged that by reference to those usual comparative jurisdictionsNew Zealand is an "outlier" in terms of how our law governs protection for industriallyapplied copyright works.44 Department of Justice The Copyright Act 1962: Options for Reform (1989) at 12.6(3).45 Reference was made to the United Kingdom, Australia and Canada.[82] However, while recognising that unlike the United Kingdom, Australia andCanada the Copyright Act does not deal expressly with function and copyright, theappellants emphasised that the New Zealand courts have for many yearsacknowledged that similarities derived from functional constraints ought not to berelied on to establish infringement.46 The point was made that the requirement forobjective similarity has always been treated as requiring visual similarity whilesimilarity in function has never previously formed the basis of a finding of copyrightinfringement in New Zealand or elsewhere.[83] The appellants' submissions went on to state:Traditionally, mechanical functions have found protection under patent law.The claims contained in a patent, properly interpreted, define the scope of themonopoly conferred by the patent. Infringement of patents is assessed not byreference to visual similarity, or the manner in which an idea has beenembodied, but rather to the adoption of the essential integers of an inventionas outlined in the claims. Irrespective of visual appearance, it can be aninfringement of a patent to substitute the parts described in the patentspecification with obviously equivalent parts to create functional equivalence.[84] It was the appellants' contention that that is essentially what the High Courthad found the appellants to have done, citing by way of example the Judge's quotationof Dr Field's evidence at [363] of the judgment as signifying the Court's focus onequivalency.47[85] The advantage of the first mover in the market was the flavour of Sealegs'rejoinder below to the appellants' argument that functional constraints in design mayminimise the originality involved in the copyright work and the protection afforded toit. The judgment recorded Sealegs' response as follows:[411] Mr Henry responds to the defendants' submission that similarities dueto functional constraints should be set aside when the issue of substantiality isconsidered by saying that that the design constraints relied on by thedefendants are only constraints that arose from Orion choosing to compete inthe same market as Sealegs, and to start from and copy the Sealegsarrangement of features. They do not explain away the similarities betweenthe two systems, and should not be set aside as the defendants submit. 46 Citing Oraka, above n 37, at [88] and the observations of Tipping J in Carter Holt Harvey RoofingAluminium & Glass Group Ltd v Trevor Bills Ltd (1988) 2 TCLR 592 (HC) at 599.47 See [158] below.[86] Where the copyright work is an artistic work in the form of a detailed drawingof a key component in a machine, the significance of the role performed by thatcomponent may have the effect of providing a de facto monopoly. We suggest thatmay be what Tipping J in Bonz had in mind when offering the following interpretationof this Court's comments in Bleiman:48Their Honours in Bleiman indicated that it was perhaps more helpful toconsider whether the effort, skill and judgment of the copyright owner in themaking of his original work had been appropriated in the making of whatappeared, on a realistic assessment, to be a reproduction of a substantial part.I do not, with respect, consider that the Court of Appeal was advocating thetotal abandonment of the conventional ideas/expression dichotomy. What Ithink Their Honours were pointing out is that while ideas as such are notsusceptible of copyright protection, an idea behind the method of expressioncan be protected if it is an integral part of the method of expression itself.[87] While we agree that Bleiman was not espousing abandonment of theconventional dichotomy, we doubt that focussing on the "integral part of the method"of expression would be useful in practice, at least in the context of works of anutilitarian nature. In Catnic Components Ltd v Hill & Smith Ltd Buckley LJobserved:49What is protected is the skill and labour devoted to making the "artistic work"itself, not the skill and labour devoted to developing some idea or inventioncommunicated or depicted by the "artistic work". The protection afforded bycopyright is not, in my judgment, any broader, as counsel submitted, wherethe "artistic work" embodies a novel or inventive idea than it is where itrepresents a commonplace object or theme.[88] Commenting on Catnic in Billhöfer Maschinenfabrik GmbH v TH Dixon & CoLtd Hoffmann J discussed the significance of the "intrinsic importance" of the idea inthis way:50The trial judge had found as a fact that the defendant had not copied theplaintiff's drawings of box girder lintels. All that the defendant had taken was"the idea of a box girder lintel." But the plaintiff said that the idea, "becauseof its intrinsic importance, had constituted a substantial part of the drawings." In other words, the defendant had copied a kind of Platonic formof a box girder lintel which could be abstracted from the actual forms in thedrawings. It was this argument which Buckley LJ rejected. Copyright does48 Bonz Group (Pty) Ltd v Cooke, above n 15, at [219].49 Catnic Components Ltd v Hill & Smith Ltd [1982] RPC 183 (CA) at 223, cited with approval byLord Oliver in Interlego AG v Tyco Industries Inc [1988] RPC 343 (PC) at 373–374.50 Billhöfer Maschinenfabrik GmbH v TH Dixon & Co Ltd [1990] FSR 105 (Ch) at 121.not project ideas but only the actual forms in which the ideas are expressed.The citation in Interlego was used to meet a similar argument.[89] Shortly thereafter the High Court of Australia in Autodesk Inc v Dyasonsuggested that the inseparability of an idea may serve to deprive its expression ofcopyright protection:51The protection of ideas, at all events when the subject of manufacture, is theprovince of patent law. There is a particular difficulty in distinguishing anidea from its expression in the case of a utilitarian work, such as a computerprogram, which, in contrast to literary works of an artistic kind, is intended tobe useful rather than to please. But it has been held that the idea of a utilitarianwork is its purpose or function and that the method of arriving at that purposeor function is the expression of the idea: see Whelan Associates v JaslowDental Laboratory, citing Baker v Selden. Thus, when the expression of anidea is inseparable from its function, it forms part of the idea and is not entitledto the protection of copyright.[90] Autodesk is footnoted to the following discussion in Copinger of Bezpečnostnísoftwarová asociace-Svaz softwarové ochrany v Ministerstvo kultury whichimmediately follows the boundary definition discussion:52Technical function. In a development of this principle, the [Court of Justiceof the European Union] has recently held that where a work consists of thearrangement or configuration of non-original components which is dictated bytheir technical function, the work is not original since the different methods ofimplementing an idea are so limited that the idea and the expression becomeindissociable.[91] Referring to that aspect of Bezpečnostní Lewison LJ in SAS Institute Inc vWorld Programming Ltd observed:53What seems to me to be clear from this passage is (a) that if expression isdictated by technical function then the criterion of originality is not satisfied;and (b) that, where that is the case, the product is not an intellectual creationof the author at all.51 Autodesk Inc v Dyason [1992] RPC 575 (HCA) at 583 (footnotes omitted).52 Davies, Caddick and Harbottle, above n 39, at [7–15] to [7–16], referring to Case C-393/09Bezpečnostní softwarová asociace-Svaz softwarové ochrany v Ministerstvo kultury [2010] ECR I-13971 at [49].53 SAS Institute Inc v World Programming Ltd [2013] EWCA Civ 1482, [2014] RPC 8 at [33].Tomlinson and Vos LJJ concurred.[92] However Lewison LJ went on to note that the creative element test may not bequite the same as the traditional test in English law. Reference was made to thedistinction drawn by the Advocate-General in Football Dataco Ltd v Yahoo! UK Ltd:54It is common knowledge that, within the European Union, various standardsapply as regards the level of originality generally required for copyrightprotection to be granted. In particular, in some EU countries which havecommon law traditions, the decisive criterion is traditionally the applicationof "labour, skills or effort". On the other hand, in countries of thecontinental tradition, for a work to be protected by copyright it must generallypossess a creative element, or in some way express its creator's personality,even though any assessment as to the quality or the "artistic" nature of thework is always excluded.[93] As Lord Bingham observed in Designers Guild Ltd v Russell Williams(Textiles) Ltd, the law of copyright rests on a very clear principle: that anyone who byhis or her own skill and effort creates an original work of whatever character has theexclusive right to copy it for a limited period.55 So too in New Zealand the lowerthreshold applies. The recognition of originality and its extent will be a reflection ofthe skill and labour expended in the creation of the particular work.However originality is a question of degree. The greater the extent to which thecreation of the copyright work is dictated by functional constraints, the less originalthe work is likely to be.[94] Before turning to assess the issue of originality in this case, it is necessary tofirst address a preliminary question, namely whether the respondent's prototypes havethe characteristics of and qualify as models for the purposes of s 2 of the CopyrightAct.Were the prototypes "models"?[95] Section 14(1) of the Copyright Act provides that copyright exists in originalworks of various descriptions including artistic works. It was common ground thatthe three prototypes could qualify as artistic works only if they were models.56 In the54 At [36], citing Case C-604/10 Football Dataco Ltd v Yahoo! UK Ltd [2013] FSR 1 (CJEU) at [36](footnotes omitted).55 Designers Guild Ltd v Russell Williams (Textiles) Ltd [2000] 1 WLR 2416 (HL) at 2418.56 The first category of the definition of "artistic work" in s 2(1) of the Copyright Act is "a graphicwork, photograph, sculpture, collage, or model, irrespective of artistic quality".fifth amended statement of claim the three prototypes were described as models andthe point now taken by the appellants does not appear to have been in issue below.[96] The reference to "model" was introduced to the first limb of the definition ofartistic work by the Copyright Amendment Act 1985.57 The reason for the additionwas explained in the Bill.58Clause 2 amends the definition of "artistic work" in section 2(1) of theprincipal Act by inserting in paragraph (a), after the word "engravings", theword "models". A design expressed in 3 dimensional form (assuming it is nota sculpture or work of architecture) is not an "artistic work" and does not comewithin the scope of copyright protection unless it is a work of "artisticcraftsmanship". A design expressed in the form of a drawing does, however,constitute an "artistic work" regardless of its artistic quality. Accordingly,whether a design is subject to the protection afforded by the Copyright Act1962 depends on the form in which it is originally expressed. The insertionof the word "models" in paragraph (a) of the definition of the term "artisticwork" means that copyright protection will be available in the case of alldesigns created in 3 dimensional form regardless of artistic quality.[97] There is no definition of model in either the 1962 Act or the 1994 Act.However in Thornton Hall Manufacturing Ltd v Shanton Apparel Ltd which concerneda sample dress this Court noted in the context of that case the word in everyday usagewas generally understood to mean:592. A representation in three dimensions of some projected materialobject, showing the proportions and arrangement of its parts (The ShorterOxford English Dictionary, p 1268.)The Court agreed with the High Court's finding that the sample dress was an artisticwork, being a model with its own originality in the chain of creativity. The dress wasmade so that the design could be seen in three-dimensional form and was not producedfrom pattern pieces in a mechanical manner with no further original skill and labour.[98] After reference to Shanton, Tipping J in Bonz remarked with reference toknitted woollen garments:6057 "Models" was already in para (b) of the definition of artistic work in relation to works ofarchitecture.58 Copyright Amendment Bill 1984 (31-1) (explanatory note), at i.59 Thornton Hall Manufacturing Ltd v Shanton Apparel Ltd [1989] 3 NZLR 304 (CA) at 310.60 Bonz Group (Pty) Ltd v Cooke, above n 15, at 221.While initially hesitant I now see the force of the conclusion that a trueprototype garment can be regarded as a model. The medium in which themodel is made can hardly be decisive. Models are often made of wood or clayor plasticine but there seems no reason in logic why for the purposes of thefashion industry, a model should not be made of some other material, ie thematerial with which the finished product is to be made. I therefore accept thata prototype garment is capable of being a model within the definition.[99] We consider that the bow and stern wheel assemblies which were designed tobe affixed to the standard RIBs adapted as prototype boats 1 and 136 were similar inconcept to a prototype garment on a mannequin or tailor's dummy. Like themannequin, the boats themselves, which were purchased by Sealegs, were not actuallypart of the prototype of the work in which copyright is claimed. Their role was as themedium for deploying and testing the componentry which enables the boats to becomeamphibious.[100] The appellants submitted that neither prototype boat 136 nor prototype IKA11could qualify as models because they were both sold to third parties. Reliance wasplaced on Lakeland Steel Products Ltd v Stevens as support for the proposition that"prototype" is not necessarily synonymous with "model", and to qualify as a model aprototype must have the characteristics of a model.61 In particular it must be used asa representation or constructed for the primary purpose of being copied rather than forthe purpose of being used. In relation to a prototype trimsaw blade Holland J thereconcluded:62In this case the plaintiff's prototypes were not manufactured in any way to berepresentations or for the primary purpose of their being used as copies.They were designed to fulfil an order for the provision of the actual article.They were never at any stage a representation of the article. On completionthey were supplied and used as such articles but not as representations. I donot consider that anything that is manufactured primarily for the purpose ofsale, and is supplied to be used rather than copied, is a model within themeaning of the Act.[101] Subsequently in Electroquip Ltd v Craigco Ltd the issue arose whether aprototype electronic sensor for use with a sheep dip was a model.63 While RodneyHansen J did not differ from the limitation adopted by Holland J, he concluded thatthe sensor was a model in the sense of being a representation of the projected finished61 Lakeland Steel Products Ltd v Stevens (1995) 6 TCLR 745 (HC).62 At 751.63 Electroquip Ltd v Craigco Ltd HC Auckland CIV-2006-404-6719, 3 September 2008.product. Although ultimately it was sold for scrap, it was not built for sale but wasdeveloped for trialling purposes.64[102] We agree with the view of the authors of James & Wells Intellectual PropertyLaw in New Zealand that Electroquip stands for the proposition that subsequentcommercial dealing with or use of an item which has been genuinely produced as aprototype will not deprive it of the essential characteristics of a model under theCopyright Act.65 The critical enquiry will be the purpose for which the item wascreated.[103] The evidence indicates that prototype boat 1, prototype boat 136 and prototypeIKA11 were all constructed as part of a process which would culminate in theproduction of the final product manufactured for sale. As noted earlier66 prototypeboat 136 was the 136th boat commercially produced by Sealegs. It was converted tothree-wheel drive which involved redevelopments of the hydraulic system and wasthen tested. IKA11 was a prototype with the purpose of providing a heavy lift systemfor larger vessels. All three were created for the purpose of ultimately being copied.[104] Although prototype boat 136 was sold after the testing process had beencompleted and IKA11 was sold in order to help recover development costs we acceptthat they both qualified as models and did not lose that status because they wereultimately disposed of by sale.[105] Consequently we conclude that all three prototypes qualified as artistic workswithin s 14(1)(a) of the Copyright Act.Was the arrangement of features original?[106] The Judge did not approach the issue of originality by making an assessmentof the extent of the skill and labour which had been expended in the creation of theidentified copyright work, namely the sequence of the collocation of known64 At [24].65 Ian Finch (ed) James & Wells Intellectual Property Law in New Zealand (3rd ed, ThomsonReuters, Wellington, 2017) at [4.4.1(4)(e)].66 At [19] above.components. Rather, apparently treating novelty and originality as synonymous, heseized on the description of the Sealegs design as "unique", the word used both inMr Bryham's brief and Sealegs' opening. His analysis of the originality issuecommenced in this way:[214] I am satisfied from the evidence that the Sealegs' retractableamphibious system when developed was unique and quite different fromanything that had been previously developed by any other manufacturers ofamphibious craft. This was accepted by Dr Field. Dr Field conductedextensive research of amphibious craft and identified a wide range of craftmanufactured to have amphibious capability. While noting that most of theelements of the Sealegs system could be found in use in other contexts, heaccepted that the Seealegs system as a whole is unique in that there is no otheridentical product available anywhere. Dr Field said, referring to the Sealegsamphibious design:I accept that it is unique in the sense that I have not been ableto find an identical combination of the elements of which he[Mr Bryham] speaks including external pivoting legs,hydraulically powered wheels and no opening in hull forwheels. However all of those elements were pre-existing inprior designs. Indeed, some could be called commonplace.[107] It should be noted that those observations of Dr Field were taken from his replybrief where he responded to Mr Bryham's reply brief. The quoted passage waspreceded by an earlier statement in these terms:Mr Bryham appears to regard his design as unique, and by implication, worthyof protection, because his design has three distinctive legs attached to theexterior of a boat which pivotally retract outside of the boat's hull. In termsof modern design procedure, that is a design concept or idea, rather than anexpression of a concept. As I detailed in my primary brief, the idea ofexternal legs attached to a boat retracting outside of the hull waswell-established for years prior to Mr Bryham conceiving his design.This conflation of an idea and its expression would appear to underlie muchof the evidence of Mr Bryham in his reply brief.[108] The same conflation of idea and expression was revealed in the next paragraphof the judgment:[215] In his evidence Mr Bryham has explained how he developed theSealegs system and he makes no reference to being inspired by any other pre-existing system. None of the amphibious systems employed on earlierproduced boats bear any visual resemblance to the Sealegs system. In allmaterial respects what Mr Bryham and Sealegs developed was novel andoriginal in terms of the placement of bow and stern retractable legs on theexterior of the boat hull, to be either extended or retracted while at all timesremaining entirely outside the hull form. The amphibious legs of the Sealegssystem do not retract into recesses within the hull form, and there is no attemptmade to conceal the legs and wheels as is often a feature with many otheramphibious craft. When retracted the Sealegs wheels and legs remain entirelyvisible and obvious. I accept the evidence of Mr Dippie that this was a radicaldesign departure from other amphibious boats on the market.[109] This passage was nothing more than a description of Mr Bryham's idea.Mr Dippie's evidence, to which the Judge had referred in his review of the severalexpert witnesses,67 was that Sealegs had made bold decisions to keep the liftingmechanism external to the boat, a decision which he viewed as counter-intuitive.He described the boat as a radical design departure from what would seem intuitivelymost marketable.[110] It was not until the next paragraph that the Judge made reference to the featuresidentified in the schedules to the pleading:[216] As well as the exterior positioning on the boat hull of the retractablelegs, the composition of the functional features of the retractable legs is alsooriginal in my view. The front leg assembly is comprised of components thatare arranged and combined to achieve the functions of being extended andretracted by rotating through an arc directly forward of the bow of the craft,and when extended provide driven power and steerage.[111] Then, without reference to supporting evidence, the Judge formulated aconclusion in terms of the orthodox originality test:[217] I shall undertake a closer examination of the Sealegs system in thecontext of the issue of whether the Orion products are objectively similar tothe Sealegs system; however, I am satisfied that the collocation of componentsand features comprising the Sealegs system is the product of substantial skilland labour and is an original work for the purposes of the Act.[112] The Judge then went further, expressing the view that there was a high degreeof originality in the Sealegs assembly pattern:[218] While each individual functional component of the leg assemblyperforms well-known mechanical functions which are themselves not original,the combination and arrangement of the components so as to achieve thefunctionality and movement required to extend and retract the amphibiouslegs, coupled with their open positioning at the bow and transom whenretracted, combine to make a highly original, effective and immediatelyrecognisable amphibious system of a kind that had not previously beenproduced by anyone anywhere in the world.67 High Court judgment, above n 2, at [172].[113] Indeed he went on to contrast the utility of the Sealegs system with aestheticartistic works:[219] The arrangement of the components developed and determined byMr Bryham can be contrasted to artistic works which involve the purelyaesthetic assembly of known features or elements in order to achieve [an]original work. Here, the originality of the arrangement of the componentsyielded a novel solution to the problems of providing amphibious capabilityfor small craft. Moreover, the originality resulted from Mr Bryham adoptingan arrangement that is appropriately described by Mr Dippie as beingcounter-intuitive. Mr Bryham rejected his initial designs and models in whichthe retracted wheels were substantially concealed and enclosed withinrecesses built into the hull form, in favour of the external positioning of thelegs on the exterior of the hull, meaning they are prominent and entirely visiblein their retracted positions. While such an arrangement and positioning maybe regarded as visually detracting from the aesthetic and hydrodynamic formof the boats on which it is installed, the advantages and utility of theamphibious capability it provides clearly outweigh those purely aestheticconsiderations. The commercial success of the Sealegs system is evidencethat despite being obvious and utilitarian in appearance, as well as generallyinconsistent with conventional marine design aesthetics, the system isnevertheless well received and regarded in the market, reflecting its originalityas an effective amphibious solution.As appears from extracts noted below68 the Judge accorded considerable significanceto the "solution" that Sealegs arrived at in the course of designing its system.[114] Mr Miles criticised such reasoning as finding originality in the idea/functionembodied in the Sealegs "system" rather than by reference to the effort and skill thatwent into the expression of the idea in the particular copyright work. He suggestedthat in works that are typically artistic, such as paintings, clothing designs as in Bonz,or even literary works such as the Ladbroke betting slip, the arrangement ofcomponents or features was more likely to be truly original because the intention is toenhance the visual appearance of the work, this being a product of the author'simagination, creativity and skill. By contrast, in his submission, the arrangement ofcomponents in a mechanism is entirely different, arising primarily from the functionto be performed. Here the evidence demonstrated that the manner in which themechanical components were arranged in the amphibious assemblies had nooriginality.68 At [142] and [160] below.[115] It is appropriate to emphasise the comparatively confined nature of thecopyright interest which Sealegs ultimately invoked at trial. As we have noted aboveSealegs abandoned reliance on any copyright in the several detailed drawings referredto in and annexed to the pleading, preferring instead to proceed solely in reliance onan unpleaded allegation of copyright in the collocation of unoriginal featuresappearing in the prototypes.[116] Such an approach was quite different from that in Oraka on which Sealegsplaced much emphasis.69 With reference to Oraka Sealegs' written submission stated:At trial, the Appellants incorrectly based their case on Bonz in circumstanceswhere it is clear that the factual matrix of Bonz is quite dissimilar to thatcurrently before the Court. The Appellants have also persistently ignoredOraka No 2, the leading case relating to copyright in a work which is acombination of features.[117] However Oraka was not a collocation case of the nature of Bonz and Henkel.The copyright claim in Oraka was based on four drawings: the first depicted anasparagus carriage in a grading machine constituting three assembled components, achassis, a tilting cup and a trigger; the other three drawings each represented anindividual component. In the High Court Allan J rejected a submission that only a lowlevel of copyright subsisted in the drawings, finding that they were relativelysophisticated.70[118] On appeal against the finding of no infringement this Court accepted that someaspects of the cup assembly were functional constraints in the true sense. Some otherswere dictated to a large degree by third party technology and, while not functionalconstraints in the true sense, had a low level of originality.71 However certaininterrelated dimensions shown in a drawing annexed to the judgment were notcommonplace and were not due to functional constraints. As the Court observed in itsfinding of infringement:7269 Oraka, above n 37.70 Oraka Technologies Ltd v Geostel Vision Ltd (No 2) HC Hamilton CIV-2005-419-809, 7 April2011 at [126]. There was no cross-appeal on that issue. The appeal was against the finding thatthere was no infringement.71 Oraka, above n 37, at [140]–[141].72 At [146].Further, there is the requisite degree of originality in the dimensions A, B andC and they are central enough to the cup assembly for the copying of thosedimensions to be the copying of a substantial part of the first appellant's work.[119] In the present case there are no drawings to be considered. The prototypesthemselves are no longer available. The claim was advanced on the basis ofphotographs of the prototypes together with the lists of componentry in the schedules,albeit no longer relied upon as individual copyright works as asserted in the pleading.The revised role of those lists of components is somewhat ambiguous.The descriptions of the various components are generic in expression and, as theappellants observed, appear akin to a list of integers73 ordinarily specified in a patent.In particular we note components 1(i) and 2 in schedule A74 which both refer to a rangeof positions, for example "in the range of 140–160 degrees".[120] The lists which are said to "define"75 the combination of features do not presentas a precise description to facilitate the identification of particular Sealegs legassemblies. For example the initial part of schedule A states:i) A front leg fixed at a pivot point external of the bow of the boat whichlocks down just short of vertical (the down locked position) whendown and when raised, rotate away from the hull about the pivot point.When fully raised the front leg locks above the waterline of the boatbetween 90 to 130 degrees from the down locked position.ii) A pivot point for the front leg which is external of the hull and fixedon the front center line of the hull.iii) A leg attached to the pivot point at one end with an axle mount at theother end of the leg. The leg forming an axis from the pivot point tothe axle at its opposite end.iv) A wheel or wheels attached to the axle mount.v) The leg has a steering pivot creating an upper leg part and a rotatablesteerable lower leg part.vi) A hydraulic steering ram mounted on the face of the upper leg axisand attached to the face closest to the hull.vii) A hydraulic steering cylinder attached to the hull side of the upper legwith a steering pivot on the leg axis.73 Indeed the respondent employed that word in its opening in the High Court.74 And the equivalent items in Schedules E and F.75 See [50(4.4)] and [66] above.viii) The steering cylinder being double ended but with one end only asteering link arm attached to the lower part of the leg.ix) A wheel (or wheels) fixed at the axle end of the leg.Rather the components referred to in the schedules are generic, not bespoke in thesense of being confined to the particular manifestation of that componentry asdeployed in the Sealegs prototypes.[121] We do not consider that the evidence demonstrated that the selection of thesequence of such generic known components required substantial skill and labour asthe Judge ostensibly found. We agree with Mr Miles' submission that Sealegs'evidence focused on the testing of the components themselves, not on the order inwhich they were to be arranged. As Dr Gooch observed in the course of questionsfrom the Judge (to which we refer below in the discussion of infringement)76 withreference to the two assemblies shown in Figure 1 annexed to the judgment:• this is a pretty conventional way of putting a leg on the ground, all ofthese components.• if you need to put a leg on the ground and actually provide steering,you're going to have all of these basic components that will be required.[122] Even to the untutored that seems an obvious point. Starting with theextremities, the connection with the hull must inevitably be at the top end of the legwhile the wheel and tyre must be at the bottom end where contact will be made withthe ground. Progressing upwards from the bottom, the wheel will need to be affixedto an axle.77 Above that there would need to be a steering pivot if the leg is to havedirectional capacity.78 No doubt there is potential for variation in the selection oflifting apparatus and its precise location. But in that regard the provision in therelevant schedules is anything but specific:79A forward pivoting alloy yoke with provision for a lift cylinder attachment;with76 At [142] below.77 Answer 1(d) to questions 5 and 6 in the experts' joint report noted that in order to roll a wheelgenerally has an axle in a practical system.78 Answer 1(e).79 Schedules A, C, E and F.A front lift cylinder attaching to the hull and yoke to raise the wheel awayfrom the front of the hull.The same can be said for all the items listed in relation to the port and starboard rearassemblies. However the significant point is that the location of those components interms of their sequence was dictated by the functional operability of the leg. In ourview the degree of originality of the sequence of the various generic components inthe leg assemblies is negligible.[123] Constraints arising from the mechanical structure of a functional item do nottend to arise in the context of aesthetic artistic works, at least in their decoration asopposed to, for example, the basic structure of the sleeves and torso of a garment.The capacity for variation in the selection of figures (as in Bonz) or the types andcolours of flowers (as in Designers Guild) is extensive. Of course, if a clothingdesigner chose as a form of decoration the numerals 0 to 9 in numerical order or theletters of the alphabet in their orthodox sequence or the colours of the rainbow in thepattern in which they naturally appear, there would be little if any originality reflectedin such choice.[124] On the face of it the Judge's analysis in contrasting artistic works involving thepurely aesthetic assembly of known features with utilitarian mechanical designs isunconvincing.80 However his comments need to be seen in the context of hisevaluation of the so-called "Sealegs system" by reference to concepts of novelty andcounter-intuition. In our view the Judge erroneously approached the issue of theoriginality in the collocation of common features by reference to the criteria forpatentability, coupled with his assessment of the commercial success of Mr Bryham'sinvention. In doing so he fell victim to the confusion inherent in Sealegs asserting thecopying of its "unique design" while confining its claim to copyright in anarrangement of known components.[125] The point is made in the observations of Lord Hoffmann in Designers Guild:81The same is true of an inventive concept expressed in an artistic work.However striking or original it may be, others are (in the absence of patent80 High Court judgment, above n 2, at [219], set out at [113] above.81 Designers Guild Ltd v Russell Williams (Textiles) Ltd, above n 55, at 2423.protection) free to express it in works of their own: see Kleeneze Ltd v D R G(UK) Ltd [1984] FSR 399. The other proposition is that certain ideasexpressed by a copyright work may not be protected because, although theyare ideas of a literary, dramatic or artistic nature, they are not original, or socommonplace as not to form a substantial part of the work. Kenrick & Co vLawrence & Co (1890) 25 QBD 99 is a well known example. It is on thisground that the mere notion of combining stripes and flowers would not haveamounted to a substantial part of the plaintiff's work. At that level ofabstraction, the idea, though expressed in the design, would not haverepresented sufficient of the author's skill and labour as to attract copyrightprotection.[126] We consider that the unjustified reach of the collocation-based claim is starklydemonstrated in an extract from the Judge's reasoning on the issue of an independentdesign path in the context of causality:[346] The defendants say, however, that their conceptual approach to anumber of aspects of the Orion system demonstrates that they adopted anindependent design path. They decided that the Orion system would havethree legs that would rotate forward of the bow and towards the rear of thestern. They decided that the Orion system would be built to support 2500kgso as to be suitable for installation on a boat of six to seven metres in length.They decided to use hydraulic power for the leg actuators and to power thehub wheels. They decided that the Orion system would be functional ratherthan aesthetic in its appearance. They decided that they would design a systemthat would be modular, in that it would be capable of being fitted to a varietyof different hulls.[347] However I consider that those conceptual design decisions confirmthat they simply adopted the same three-leg system as Sealegs and the samegeometry as Sealegs in terms of the placement of the legs onto the hull and interms of the use of hydraulic powered actuators for extension and retractionof the legs. The adoption of the 2500kg load bearing specification was alsothe same as Sealegs, as was the use of hydraulic power for the hub wheels.Further, while the defendants made choices to give the Orion system afunctional appearance in contrast to the sculptured appearance of the Sealegssystem, that did not represent any material departure from the establishedSealegs combination of features for which the plaintiff claims copyright.The different design features that Dr Field and the defendants rely on asdemonstrating that they adopted an independent design path are notdifferences so far as the composition and collocation of the functioningcomponents of the leg assemblies are concerned, but are rather due to differentapproaches being taken to aspects of design detail. I consider this distinctionto be of real significance in this case.[127] Although we find that there was negligible originality in the sequence of thegeneric components of the leg assemblies, we consider that Sealegs did expend someskill and labour in the choice of the shape and dimension of certain of the componentsin the arrangement which, to that extent, confers a degree of originality on thearrangement itself. A conspicuous example is the yoke on the Sealegs front legassembly. Another is the method of mounting both the front and rear assembly frames.However the originality in an arrangement which derived from the presence of thosefeatures would be modest and certainly very much less than the high degree found bythe Judge.Infringement — principles[128] The judgment commenced the consideration of infringement by noting thethree well-established Wham-O steps,82 which the appellants accepted as a correctarticulation of the test for infringement. In a footnote the Judge observed that thisCourt in Oraka had approved that test but had adjusted the ordering of the steps.83That observation was accurate so far as concerns the point at which the issue ofsubstantiality, the first in the Wham-O formula, is considered.[129] However in the discussion of objective similarity which followed, afterreferring to the submission of counsel for the appellants that functional constraints andcommon concepts and ideas should be put aside for the purpose of assessing similarity,the Judge said:[261] However, at this first step in my determination of whether theplaintiff's copyright has been infringed, I consider it appropriate to addressthe issue of whether there is an objective similarity between the Sealegs andOrion systems on the basis of their visual appearance, leaving the question offunctional constraints to be addressed in the context of determining the issuesof causal connection (the second step) and substantiality (the third step).This sequential approach avoids confusing the three steps in the analysis, andwas adopted and approved by the Court of Appeal in Oraka Technologies Ltdv Geostel Vision Ltd. Further, the extent to which similarities are the result offunctional constraints is more logically relevant to the second and third stagesof the analysis, as similarities that are purely the result of functionalconstraints may indicate a lack of causal connection between two works, orthey may indicate that the defendants have not copied a "substantial part" ofthe plaintiff's copyright work.(Footnote omitted.)82 High Court judgment, above n 2, at [248], citing Wham-O MFG Co v Lincoln Industries [1984]1 NZLR 641 (CA) at 666. The steps are set out below at [130].83 At [248], n 40; citing Oraka, above n 37, at [85]–[86].[130] The passages from Oraka referred to by the Judge in support of this approachstated:[85] The leading test for infringement by copying was established inWham-O MFG Co v Lincoln Industries Ltd. In that case, this Court set outthree main elements:(a) Substantiality: The reproduction must be either of the entirework or of a substantial part.(b) Objective similarity: There must be sufficient objectivesimilarity between the infringing work and the copyrightwork, or a substantial part thereof.(c) Causal connection: There must be some causal connectionbetween the copyright work and the infringing work.The copyright must be the source from which the infringingwork is derived.[86] The Court in Wham-O was not, however, mandating the order inwhich the factors were to be considered in all cases. It seems to us that themost logical ordering will usually be first to examine whether there isobjective similarity before turning to the question of causation and finallysubstantiality.[87] The "substantiality" test can be regarded in part as a practicalthreshold designed to limit claims of infringement to those that are real andsubstantial. The appropriate place to apply a practical test such as this is atthe end, once the act of copying has been established. It also means that theissue of substantiality is decided on the basis of what is actually found to havebeen copied rather than on what may be wider allegations of copying.The High Court was incorrect to apply the substantiality test to the appellants'allegations, rather than to what was actually copied.[88] Evidence that there are functional constraints on a design can beevidence supporting an inference of an independent design path (and thereforeno causation). It can also be important in assessing whether a substantial parthas been copied as discussed below.(Footnotes omitted.)[131] We consider the Judge was reading too much into those comments inconcluding that the impact of functional constraints should not be considered at thefirst step. That is inconsistent with the dictum of Lord Millett in Designers Guild towhich the Judge referred at the outset of his consideration of objective similarity.84After explaining that at the first step of identifying the features alleged to have been84 High Court judgment, above n 2, at [250], referring to Lord Millett's statements in DesignersGuild Ltd v Russell Williams (Textiles) Ltd, above n 55, at 2425.copied the Court undertakes a visual comparison of the two designs, Lord Millett thennoted:It is at this stage that similarities may be disregarded because they arecommonplace, unoriginal, or consist of general ideas.That proposition is expanded in Copinger to include "the result of common subjectmatter or external constraints, such as dimensions to which both works are subject".85[132] We do not consider that this Court in Oraka was advocating any differentapproach. Indeed later in the judgment in the course of addressing the issue ofsubstantiality the Court said:[131] The issue of functional constraints may become important at thispoint. If similarities between two works are dictated by the function of theitem, then the similarities are an inevitable consequence of the object and itsfunction rather than the labour and skill of the claimant, against whosemisappropriation the law of copyright seeks to protect.[132] Functional constraints have been considered in the United Kingdomunder the notion of "commonplace". If the claimant's design is very ordinary(commonplace) given the constraints imposed by the function of the objectand there is nothing new added, then the originality of the claimant's workmight be non-existent or so low that the defendant can easily avoid breach byadding something of his or her own to the design. The situation has beendescribed as follows:If a number of designers working independently of one anotherin the same field produce very similar designs by coincidence themost likely explanation of the similarities is that there is only oneway of designing that article. In those circumstances the designin question can fairly and reasonably be described as"commonplace". It would be a good reason for withholding theexclusive right to prevent the copying in the case of a design that,whether it has been copied or not, is bound to be substantiallysimilar to other designs in the same field.[133] Although the existence or otherwise of functional constraints isprimarily relevant to earlier questions regarding the originality of the workand whether copying has in fact occurred, functional constraints may alsoassist in determining the originality of the respective works and whether asubstantial part of the claimant's labour and skill has been taken by thedefendant.(Footnotes omitted.)85 Davies, Caddick and Harbottle, above n 39, at [7–104].[133] It is apparent that the Judge considered that the objective similarity analysis inOraka was "instructive".86 We earlier noted the different nature of the claim in thatcase.87 The circumstances of the objective similarity conclusion should also be noted.First, it was common ground that there was objective similarity between the length ofthe cups in the two assemblies. Secondly the experts on both sides were agreed thatthe Geostel cup assembly resembled a second generation model of the Schwarz cupassembly. This Court concluded that there was objective similarity between the two.88[134] That Lord Millett's view reflects the orthodox New Zealand approach isapparent from Beckmann v Mayceys Confectionary Ltd where the High Court foundthat crocodile-shaped confectionary imported into and sold in New Zealand byMr Beckmann infringed the copyright in Mayceys' plaster model or sculpture of acrocodile from which moulds had been made for its "Killer Crocs" jube product.Delivering this Court's judgment Gault J discussed the requisite degree of similarity:89Just what degree of similarity there must be before it amounts to reproductionis never an easy matter to determine. Certainly something less than anexact replica is sufficient: AHI v New Lynn Metalcraft Ltd (No 1) (1982)1 NZIPR 381, British Northrop Ltd v Texteam Blackburn Ltd [1974] RPC57,72. If there is borne in mind the purpose for which the resemblance isassessed it is apparent that whether or not it is sufficient will depend in parton the originality and distinctiveness of the copyright work. If two artistssketch the same common object necessarily there will be close resemblance.Similarly in product design two designers will embody features dictated byknown manufacturing constraints which necessarily will be similar.[135] After undertaking a detailed comparison of the samples of the Beckmannproduct with the plaster model, the Court concluded that any similarities in therepresentations of crocodiles were not such as to suggest that each had not beendevised independently. The Court explained:90We have given careful consideration to the reasons expressed by the trialJudge for his finding that there is significant objective similarity between thecopyright work and the Beckmann Mark 2 product but because of the viewswe have expressed we are respectfully unable to agree with his conclusion.His comparison perhaps was made without giving sufficient consideration to86 High Court judgment, above n 2, at [252].87 At [117]–[118] above.88 Oraka, above n 37, at [112]. In his summary at [252] the Judge referred to this Court havingconcluded "overall" that there was objective similarity. However that word was not used by theCourt of Appeal.89 Beckmann v Mayceys Confectionery Ltd (1995) 33 IPR 543 (CA) at 546.90 At 548.the fact that both articles are representations of a common animal the featuresof which are distinctive but not because of any creativity on the part of thecopyright owner.[136] In carrying out a visual comparison without taking into account the extent towhich the claimed copyright work was commonplace or dictated by functionalconstraints we consider that the Judge adopted an erroneous approach inconsistentwith both Designers Guild and Beckmann.Objective similarity?The High Court's finding[137] The Judge first addressed the objective similarity between the front legassemblies on the Orion S25-3WD and the Sealegs S60-3WD. Having conducted aview where both parties displayed their systems attached to a number of different craftand each separately demonstrated the functioning of their retractable leg systems, theJudge considered that "broadly speaking" the front leg assemblies of the two systemswere visually similar, both in their appearance and functioning.91 While notingdifferences which readily enabled the Orion system to be distinguished from theSealegs system, he nevertheless considered that the Orion rear leg assemblies wereobjectively similar to the Sealegs rear legs.92 He reached the same conclusion inrelation to a visual comparison of the Orion S25-4WD and the Sealegs S60-3WDdespite there being some obvious differences.93Errors in approach[138] We consider that the Judge's consideration of objective similarity was deficientin four respects. The first, which we have addressed above, was the failure to take intoaccount the extent to which the claimed copyright work was commonplace or dictatedby functional constraints.9491 High Court judgment, above n 2, at [265], set out below at [140].92 At [277].93 At [281]–[283].94 At [136] above.[139] The second error was the inevitable consequence of the Judge's evaluation ofthe degree of originality in Sealegs' relevant copyright work as high. The protectionprovided by copyright in an arrangement is proportionate to the work's originality.As the Supreme Court stated in Henkel,95 if the skill and labour that has given rise toan arrangement is not great, another arrangement of the same unoriginal underlyingfeatures may not have to depart greatly from the copyright arrangement in order toavoid infringement. However because the Judge considered that there was a highdegree of originality in what he described as the Sealegs assembly pattern, the Judgedid not apportion much significance to those differences which he did identify.[140] Both the first and second errors are evident in the Judge's conclusion as tooverall similarity:[265] Broadly speaking, I consider that the front leg assemblies of the twosystems are visually similar both in their appearance and functioning. Thefeatures of the two systems are identified on photographs and placed side byside in an exhibit produced by the plaintiff. In both the Sealegs and Orionsystems:(a) the front leg assemblies are connected to the hull of the boat by meansof a bracket at the bow;(b) the front leg assemblies are retracted and extended by means of ahydraulic actuator or cylinder;(c) from their extended position the legs are retracted by being drawnforward of the bow through an arc into a retracted at rest position, inwhich they are located above the waterline and in front of the bow inan external position;(d) the legs rotate around a pivot point that appears to be similarlypositioned at the bow of the craft;(e) a yoke is connected to the leg pivot point, to which the hydraulicactuator is connected to extend or retract the leg — while the shape ofthe yokes of the two systems differ, with Sealegs having a larger yokecompared to Orion's, the functioning of both is the same and theoverall impression and appearance is one of similarity;(f) the yoke is connected to a single-sided wheel fork, to which the frontwheel is connected;(g) steering the front wheel and turning the wheel fork is achieved bymeans of a hydraulic steering cylinder, which in both systems islocated at the rear of the yoke and moves a steering link arm connectedto the wheel fork;95 Henkel KGaA v Holdfast New Zealand Ltd, above n 15, at [41].(h) the tyres and wheels attached to the wheel forks are of similar size andappearance, with the wheels being driven in both cases by a hydraulicmotor located on (in the case of Sealegs) or within (in the case ofOrion) the wheel hub. Despite the difference in terms of thepositioning of the hydraulic hub motors, and the visually obviouswheel hub motor housing on the Sealegs system compared to theinternally located Orion hub motor, the overall appearance isnevertheless one of similarity; and(i) the hydraulic fluid to power the wheel hub motor is supplied by meansof external hydraulic hoses — while there are differences in how thehydraulic hose lines are connected and as to how the hydraulic fluidis conveyed to the hub motors, the overall appearance is one ofsimilarity.Functional resemblance — the third error[141] The references to "functioning" signal the third error which was thesignificance the Judge accorded to the "functional resemblance" of the assemblies.The Judge's perception was discernible in his questioning of Dr Gooch about the Orioncommission to produce an amphibious kit for Mr Pringle's Smuggler boats:Q. So all of a sudden the big blank piece of paper becomes very focused,doesn't it, because the designers are no longer setting out to createsomething out of thin air but to create something that performs thesame function as a Sealegs system, right?A. Yes so, yes that's correct, so, and so that gets you back to the basicfunction —Q. So much of what you have outlined in terms of the designmethodology and sequence of rational development advances to go, ifyou like, because the designers are no longer starting with designsomething new, they're being asked to design something that doessomething, does the function just the way in which Sealegs leg did, isthat right?[142] Then with reference to the images of the two leg assemblies in Figure 1 theJudge questioned Dr Gooch in this way:96Q. Just pause there then, the various features that have been identified on[Figure 1], the elements of the leg —A. Yes.Q. Apart from the obvious differences that you've pointed out, and thedifferent dimensions and aspects, for example, of the —96 This sequence incorporates the answers of Dr Gooch referred to at [121] above.A. Yes.Q. — of the yoke, et cetera, the various components are all replicated,between one and the other, aren't they?A. Yes, but the difference I'm talking about is like, if you take the yoke,for example, —Q. I understand, just bear with me. The functional components of theSealegs solution are all [evident] in the Orion solution too, am I right?A. That's correct. All except one which is that bearing assembly which—Q. The bearing assembly in the wheel?A. Yes.Q. So all of the components can be shown to have an equivalent in eachproduct, is that right?A. That's right.Q. A functional equivalent?A. Yes.Q. They differ in number of respects as you've identified?A. Yes.Q. As to how they perform their function in some respects, but in essencethey're performing the same function in each case, is that right?A. Yes, but like —Q. Just bear with me, please. Clearly the Orion system has engineeringdevelopments, if you like, taken solutions that Sealegs might havedeveloped and have moved forward with, what might be regarded asan enhancement or more sophisticated solutions, would that be fair?A. I don't necessarily agree with that.Q. In some cases, but not in all?A. Yes, I mean when I look at this, this is a pretty conventional way ofputting a leg on the ground, all of these components. I mean theexamples we've looked at and the prior art were not good examples.They're quite hard to match up but like I was showed the grain stacker,for example, you know. If you look at that, that's a much closer, you'llsee the basic configuration. If you've got, if you need to put a leg onthe ground and actually provide steering, you're going to have all ofthese basic components that will be required. But these componentsare applied to a hull which is the same shape, so you would probablyexpect them to be a greater level of similarity.[143] The extent to which functional equivalence impacted on the Judge's evaluationis demonstrated in his conclusion on objective similarity:[284] In summary, I consider that the Orion S25-4WD and S25-3WD frontleg and rear leg assemblies possess the same arrangement of features andfunctional components required to perform the extension and retraction of theamphibious leg system, and show a sufficiently close visual and functionalresemblance to the Sealegs assemblies as to be objectively similar to theSealegs front leg and rear leg assemblies which appear on the Sealegsprototype boat one, prototype 136 (S60-3WD) and SL100. Furthermore,while there are certainly differences in appearance as I have noted, in eachcase the positioning of the assemblies on the boat hulls and the movementfunctions performed by the front and rear assemblies are the same. The overallsize and dimensions of the Orion systems are either the same or very similarto the Sealegs S60-3WD front and rear assemblies, and although on a differentscale, also similar in function and general appearance to the front and rearassemblies of the Sealegs SL100 system.[144] The Judge considered that the differences that were visually apparent and thefunctional and internally located differences identified by the appellants were moreappropriately considered in the context of causality and substantiality.97Several paragraphs in those subsequent discussions underscore the Judge's reliance on"fundamental functionality" as a justification for discounting the significance of theidentified differences:[362] I agree with the evidence of Mr Dippie in which he explains thesignificance of the design decisions incorporated into the Sealegs arrangementof features comprising its leg assemblies, and Orion's adoption of thatarrangement as the basis of its own leg assemblies. The differences betweenthe Orion system and the Sealegs system as identified by Dr Field, whilstachieved by skilled engineering and which may be seen as beingimprovements, are nevertheless alternative engineering solutions to achievingthe same functions performed by the equivalent Sealegs components, and theydo not alter the leg assembly's fundamental functionality. An example isOrion's incorporation of drilled galleries in the retraction and steeringcylinders to transfer hydraulic oil, rather than using external hydraulic hoses.Using this method the associated hydraulic hoses remain static and do notarticulate as the leg extends and retracts, thereby extending their longevity.[145] In our view such reasoning in effect recognises an exclusive right to a methodof operability, which is the realm of patents not copyright. It imports the samereasoning evident in the analysis at [219] of the judgment98 which led to the finding97 High Court judgment, above n 2, at [285].98 At [113] above.of a high degree of originality in the "Sealegs leg pattern". It is unsurprising that itprovoked Mr Miles' criticism of "copyright heresy". As stated in Copinger:99Nevertheless, it must be borne in mind that what is protected is the intellectualcreation expressed in the artistic work, not the intellectual creation devoted todeveloping the idea or invention communicated. The limit of protection in thecase of an artistic work is its visual characteristics, not the technical ideas thatit embodies.(Footnote omitted).Dimensions and geometry — the fourth error[146] After reciting the visual similarities in appearance and functioning in [265], theJudge proceeded to state that the two assemblies were also substantially similar interms of "their dimensions and geometry".100 However as the appellant observed,Sealegs' case at trial did not rely on similarity in dimensions and no mention of it wasmade in Sealegs' closing.101 Similarly, save for a reference in an extract from Oraka,any reference to those factors was conspicuously absent from Sealegs' writtensubmission on appeal. Nevertheless similarity in dimension and geometry appearedto assume significance in the finding of objective similarity:102[267] The plaintiff produced several further photographs of the two front legassemblies as well as overlayed line drawings depicting the leg assemblycomponents with measurements, dimensions and geometry to show the closesimilarity between the Sealegs and Orion systems. In one diagram, ninefeatures of the Sealegs assembly are drawn and identified in a diagrammaticalpresentation, which is then overlayed upon photographs of the SealegsS60-3W and the Orion S25-3WD showing the features common to both.[147] The Judge then said:[268] In a second diagram, the dimensions and geometry of the two systemsas installed on a Smuggler hull are presented side by side. As is apparent fromthis diagram, the two systems both have the same or very similar dimensions.For example, in both cases the measurement of the distance between theground and leg pivot point is exactly the same, 1.0 metres. The size of thewheels and tyres are exactly the same (0.3 metres and 0.6 metres respectively).The distance between the pivot point and the centre of the wheel hub is the99 Davies, Caddick and Harbottle, above n 39, at [7–106], citing the authorities discussed at n 49above.100 High Court judgment, above n 2, at [266].101 In the written opening there was a single reference to geometry in support of the proposition thatthe facts were "akin to those in Oraka". However Oraka was a case which involved drawings inwhich dimension and geometry were actually in play.102 The diagram referred to was Figure 2 in the appendix to the judgment.same (0.7 metres). Where the measurements and geometry are differentbetween the two systems, those differences are minor. The difference in thearc of the movement between the assemblies' extended positions and retractedpositions is 13 degrees (Sealegs 110 degrees, Orion 97 degrees). The greaterarc of the Sealegs systems is due to its leg being closer to vertical whenextended than is the case with the Orion leg when it is extended.[148] On this issue the expert evidence was instructive. Taking issue withMr Bryham's contention that there are no functional constraints on the developmentof a design for an amphibious boat, Dr Field explained that there were multipleconstraints:41. important constraints for the Sealegs/Orion/Smuggler class were:boat's weight, space available for stowing retracted wheels, structuralform of the hull, road surface characteristics, road speed required,incline limits, required speed of deployment, craft on-water dynamiccharacteristics, required ground clearance/depth of outboard motorand existing steering mechanism.42. Because Orion decided to provide amphibious equipment to enteralmost the same market as Sealegs, it was inevitable that most of theirfunctional constraints would be identical, leading to similar optimalsolutions, and in some cases, almost identical components (such as thehydraulic motors and tyres). [149] We do not use the expression functional constraints in the very limited way inwhich Mr Henry purported to define the term for the purposes of his cross-examinationof Dr Field, namely as comprising the following three constraints:• first, that the amphibian has to float and perform like a boat;• second, it has to be able to travel across land; and• third, and most importantly, it has to be able to traverse from land to waterand water back to land in a mechanically suitable manner.Unsurprisingly Dr Field did not view those criteria as constraints but rather asamounting to a definition of an amphibious vehicle.[150] The appellants also emphasised the point that nowhere in the judgment was itacknowledged that the experts' joint report103 explained that the dimensions werederived from the hull of the recipient boat. They were at best a neutral factor in103 See [54]–[55] above.ascertaining whether there had been copying. Having identified the two distinctlyseparate categories of geometry, kinematic and manufacturing, the report said:(i) One possible set of measurements that define the KinematicGeometry is shown attached. There are seven dimensions associatedwith the front wheel, nine associated with the rear wheels (with twodimensions common to the front wheel if identical tyres are used), andfour dimensions associated with the hydraulic power pack.Most of these dimensions are associated with either the functionalrequirements of the amphibious craft, or are constrained by the hull towhich the amphibious equipment is attached. There are eightdimensions of the hull, waterline and the ground position duringon-land travel that are also needed before the Kinematic Geometrycan be properly determined. We note that both systems have beenfitted to hulls with identical relevant geometries, made by the onemanufacturer.After discussing the potential for similarity in respect of each of most of the20 dimensions104 the report stated:Many of these dimensions are determined by the functionalrequirements of the type of craft. Others are determined by acombination of the functional requirements and the dimensionalcharacteristics of the selected hull. All the Kinematic Dimensionsexcept for the separate dimensions of the hydraulic power pack haveideal values when one particular hull is selected. No KinematicDimension of the front or rear retracting arm assemblies isindependently selectable if its ideal, or near-ideal value is sought.(ii) There are dozens of manufacturing dimensions for each system.Most of the dimensions (and in particular those that determinestrength) are interdependent, meaning that once one dimension hasbeen selected, several others become determined in order to achieve aselected performance. For example, Sealegs utilises a wide yoke atthe front leg, while Orion uses a leg that is about half the width. Theground contact forces that pass into the respective yokes create verydifferent forces in the yokes, and the dispositions of metal in therespective yokes are therefore quite different in order to satisfactorilyabsorb those loads.[151] The appellants observed that the judgment appears to view with suspicion thefact that the Orion kit was designed for a boat of 2500 kg weight and 6–7 metres inlength.105 But the appellants are correct to say that it is a perfectly legitimate designchoice for a party to make. Absent the existence of patents or a restraint of trade of104 Only dimensions 19 and 20 were not specifically discussed.105 High Court judgment, above n 2, at [346]–[347].some kind, a party such as Orion is at liberty to design and construct an amphibiouskit for a standard powerboat, provided it does not copy the copyright works of another.[152] There was no reference to "geometry" in the identification of the copyrightworks at the commencement of the trial106 or in any of the "defining" seven schedules.The only references in those schedules to any feature of a geometrical nature were thetwo items which provided for a range of angles discussed at [119] above. It followsthat "geometry" was not a feature comprised in the collocation as claimed.While there are many references to geometry in that part of the judgment addressingcausality, we do not consider that either geometry or dimensions were validconsiderations in the objective similarity assessment.[153] It was inevitable that a visual comparison which incorporated those four flawedperspectives would lead to a conclusion that the leg assemblies were objectivelysimilar. It is necessary that we proceed to make our own assessment.Our analysis[154] The assessment involves a visual analysis of the copyright work and thosefeatures of a defendant's work which are alleged to have been copied from thecopyright work. Given the nature of the claim in this case, that involves a comparisonof the respective leg assemblies and the manner of their attachment to the boat hulls.As the Supreme Court explained in Henkel, none of the various known componentsare ignored for to do so in a claim founded on an arrangement of such componentswould result in a vacuum.107[155] We commence the analysis by reference to the work in respect of which wehave found there to be some degree of originality, namely the bespoke form ofarrangement visible in the leg assemblies on the prototypes, not the genericarrangement comprising the non-specific integers in the schedules. In undertaking thevisual comparison, as Designers Guild and Beckmann explained, certain types ofsimilarities should be disregarded. In our view those similarities are two-fold: first106 At [50] above.107 Henkel KGaA v Holdfast New Zealand Ltd, above n 15, at [47].similarity arising from a commonplace leg structure;108 secondly similarity as aconsequence of the deployment of an amphibious kit to vessels of similar size anddimension.[156] When approached in that manner the problem for Sealegs is that its bespokeleg assembly arrangement and the Orion leg assembly arrangement are not visuallysimilar. Various differences were identified by the appellants' expert witnesses,several of which were recognised by the Judge, for example:[275] There are some obvious visual differences between the SealegsS60-3WD and Orion systems and how the Orion assemblies are installed ontothe stern of the hull. Instead of an exterior surface mounted bracket as usedin the Sealegs system, the Orion rear leg and lifting actuator are connected toa plate bracket located and glued on the inside of the hull. While the leg itselfis connected to the hull in a similar location to Sealegs, the lifting arm isconnected to the hull in a lower and closer position to the leg than the Sealegssystem. Whereas the lifting rod on the Sealegs system is connected at the topof the leg, the lifting rod on the Orion system is connected to a pivot pointlocated near the bottom of the leg.[276] Compared to the sculpted shape of the Sealegs S60 rear leg assembly,the Orion leg is a straight sided oblong shape with an engineered appearance.The Orion lifting actuator is similarly oblong shaped and has a quadrangularprofile. However, the Sealegs SL100 rear leg assembly also has an engineeredappearance and styling.[277] While the differences to which I have referred readily enable theOrion system to be distinguished from the Sealegs system, I neverthelessconsider that the Orion rear leg assemblies are objectively similar to theSealegs rear legs. I shall however address the significance of these differenceswhen dealing with the issues of causality and substantiality.[157] Similarly in the Judge's conclusion on objective similarity:[284] In summary, I consider that the Orion S25-4WD and S25-3WD frontleg and rear leg assemblies possess the same arrangement of features andfunctional components required to perform the extension and retraction of theamphibious leg system, and show a sufficiently close visual and functionalresemblance to the Sealegs assemblies as to be objectively similar to theSealegs front leg and rear leg assemblies which appear on the Sealegsprototype boat one, prototype 136 (S60-3WD) and SL100. Furthermore, whilethere are certainly differences in appearance as I have noted, in each case thepositioning of the assemblies on the boat hulls and the movement functionsperformed by the front and rear assemblies are the same. The overall size anddimensions of the Orion systems are either the same or very similar to theSealegs S60-3WD front and rear assemblies, and although on a different scale,108 At [121]–[122] above.also similar in function and general appearance to the front and rear assembliesof the Sealegs SL100 system.[158] As in the conclusion to [277] so too in [285] the Judge went on to explain thatthe differences that were visually apparent and the functional and internally locateddifferences were more appropriately considered in the context of considering causalityand substantiality. However at that point in the judgment, the Judge then discountedthe differences because of his view that they made no change to the fundamentalfunctionality of the leg assemblies. As he said, immediately following the paragraphwhich Mr Miles criticised as wrong in principle:109[363] Another example is the front and rear leg assembly mounting frames,located inside the hull, to secure the leg assemblies at the bow and transom.The mounting frame is bonded to the inside of the hull with a structuraladhesive, and has tapered holes to accept the tapered spigots for the hingedmounts of the lifting cylinder. While this method of connecting the legassembly to the hull is quite different to that used by Sealegs, which uses anexternal mounting, it is nevertheless simply a means of attaching the leg ontothe hull. In the case of the rear leg assemblies, the internal mounting platesprovide an advantage by reducing the bulk of the assembly on the transom, ascompared to the large bracket used to secure the rear legs on the Sealegssystem. Again, however, the use of the mounting brackets is an alternatemethod of fixing the legs to the boat hull, and while there are advantagesderived from this solution, they make no change to the fundamentalfunctionality of the leg assemblies as innovated by Sealegs. Dr Fieldacknowledged this to be the case:The Sealegs and Orion systems have the same set of sub systemsbecause they are products that apply to the same amphibious craft these subsystems include wheels, hydraulic drives, retractionmechanisms, steering mechanisms and hydraulic power packs.Sealegs's and Orion's subsystems also have some physically differentbut 'equivalent' parts because they have to perform the same genericfunctions or because they are the best standard way of fulfilling theirfunction: these include tyres, retraction arms, retraction cylinders,steering fork, steering cylinder and control valves. But there also partsin each system that are unique to either Sealegs or Orion(Emphasis in original.)[159] Hence the identified differences were excluded from any role in the Judge'sobjective similarity analysis. Such an omission would be significant if, as ourdiscussion to this point assumes, the copyright work relied upon was the bespoke109 See [145] above.arrangement whose originality derived from the particular features of certain of thecomponents in the combination such as the yoke.[160] However, possibly mindful of the differences in the appearance of the twosystems, Sealegs confined its claim squarely to what we have described as the genericarrangement. This was made explicit in the following excerpt from the judgment:110Here the plaintiff does not allege that the detailed features designed andincorporated into the Orion system by Mr Zubcic were copied from theSealegs system. What the plaintiff alleges is that Orion copied thearrangement of functional features in its assembly, including the externalplacement position of the leg assemblies on the boat hull, the geometry of thesystem and its movement. Those same fundamental design decisions andsolutions that were developed by Sealegs and which are incorporated andrepresented in the assembly of components comprising its amphibious systemhad to have been adopted by Mr Zubcic before he could possibly proceed toaddress the aspects of detailed design which in each instance related toalternative engineering solutions for components and functions alreadyresolved and apparent in the Sealegs system.[161] However this is a blind alley for Sealegs. The reason for that lies in ourconclusion that there was no originality in the sequence of the generic components.Having based its claim not only on a collocation of known components in a functionalsequence but also on a collocation of such components of the generic nature describedin the schedules, Sealegs' case must stumble at the objective similarity stage for wantof a copyright comparator.[162] That conclusion has the consequence that the appeal must succeednotwithstanding the fact that it could not be disputed that access to Sealegs' designand production processes had been available to Mr Leybourne and Mr Zubcic.[163] We now briefly record our views on the remaining issues.The relevance of an engineer's perspective[164] As Copinger states, in the assessment of objective similarity "visuallysignificant" means visually significant to a person to whom the work would normallybe addressed.111 At trial the appellants contended that the assessment of objective110 High Court judgment, above n 2, at [361].111 Davies, Caddick and Harbottle, above n 39, at [7–106].similarity in this case required the Court to consider and compare the relevant worksthrough the eyes of an engineer, relying on the approach adopted in Hammar MaskinAB v Steelbro New Zealand Limited.112 Panckhurst J there accepted that where thecomparison involved engineering drawings it was the impact on the engineering eyewhich was important.113[165] Davison J rejected the appellants' argument on the ground that the relevantitems for comparison were not engineering drawings as in Hammar Maskin but theactual leg assemblies as manufactured.114[166] In Billhöfer115 (the authority cited for the Copinger proposition above)Hoffmann J discussed British Leyland Motor Corp v Armstrong Patents Co Ltd116which concerned an exhaust system for a Marina motorcar, the salient feature of whichwas the flow-line. Having noted that, although Armstrong had not copied the BritishLeyland drawing which it had never seen, it had nevertheless taken the crucialdimensions of the British Leyland product, Hoffmann J then set out the passage whichthe appellants relied upon in this Court:117To whom, one asks, would the flow-line have been the salient feature and thedimensions "crucial"? Not to a visitor observing the exhaust pipe mounted ona plinth at the Tate Gallery but to the engineer wanting to make an exhaustwhich would fit under a Marina. In my judgment, therefore, the question inthis case is whether the particular dimensions and spatial arrangements takenby Mr Hardcastle from the Billhöfer design would to an engineer have beenof sufficient importance to constitute a substantial part of the overall drawing.[167] The appellants argued that in a case like the present concerning mechanismsdesigned by engineers, expert engineering evidence was highly relevant to theassessment of the claimed similarity between the copyright work and the allegedinfringement. However the Judge failed to take into account not only the extensiveexpert evidence but also the experts' joint report.118112 Hammar Maskin AB v Steelbro New Zealand Ltd HC Christchurch CIV-2006-409-977, 8 October2008.113 At [182].114 At [263].115 Billhöfer Maschinenfabrik GmbH v TH Dixon & Co Ltd, above n 50, at 122.116 British Leyland Motor Corp v Armstrong Patents Co Ltd [1986] RPC 279 (CA).117 At 122.118 At [54]–[55] above.[168] As already noted119 unlike Billhöfer the present case as revised in opening wasnot one which relied on particular dimensions and spatial arrangements. If the Judgehad addressed the case on the footing it was advanced and by applying the orthodoxapproach to objective similarity reflected in Designers Guild and Beckmann, then theexpert evidence may not have been of moment.[169] However in addition to ignoring points of difference in the assessment ofobjective similarity, ironically the Judge in fact treated both dimension and geometryas being significant. In consequence the expert evidence was relevant as serving toexplain why in the circumstances similarities in dimension and geometry were notinformative.[170] For this reason we agree with the appellants that the Judge erred in failing tohave regard to the expert evidence as to the commonplace nature of the components,their functional nature and the factors which explained perceived similarities indimension and geometry.A failure to take account of the appellants' expert evidence?[171] If a claimant demonstrates sufficient similarity between the copyright workand the features alleged to have been copied and establishes that a defendant had prioraccess to the copyright work, it is then for the defendant to satisfy the Judge that,despite the similarities, the alleged infringement did not result from copying.120[172] The appellants argued that the Judge erroneously failed to take into account theevidence of their expert witnesses that:• an independent design path was followed;• none of Sealegs' design information would have been of assistance to, andwas therefore not appropriated by, the appellants in their design; and119 At [152] above.120 Davies, Caddick and Harbottle, above n 39, at [7–04].• no significant time, effort or skill on Sealegs' part could have been, or was,appropriated by the appellants in their development of the S25-4WD andS25-3WD.[173] The Judge's finding that the appellants failed to show that the Orionamphibious system did not result from copying the Sealegs system was based on twoconclusions. First he found that the evidence of Messrs Leybourne, Zubcic and Zhangwas unreliable. Secondly, while accepting that the appellants did independentlydesign alternative engineering solutions for several aspects of the Orion legassemblies,121 he held the view that design overlap was unacceptable even at the earlystage of a design process.[174] The Judge described the appellants' experts' analysis of the design process inthis way:[357] Dr Gooch explained in his evidence that the conventional analysis ofthe progression of mechanical engineering design can be divided into the fourstages that I set out earlier, being: clarification of the task; concept design;embodiment design; and detail design. Dr Field and Dr Gooch both say thatthe embodiment and detail design phases of the design sequence will generallyoccupy the bulk of an engineer's time required to develop a final design.The Judge rejected this approach holding that, provided the plaintiff has embodied anoriginal idea into a work for which copyright may legitimately be claimed, it did notmatter at what stage of the professional engineers' design path that process occurred.122[175] The Judge thus concluded:[365] I therefore consider that the defendants cannot discharge the onus ofshowing an independent design path by means of evidence showing that thebulk of the design time and effort was spent on the detailed design stage andby a process similar to that of a professional engineer's design pathway.Comparing the Sealegs design process to that of a professional engineer is oflittle relevance to the issues that I am required to determine here, where theevidence is clear that what Mr Bryham and Sealegs developed and producedwas an original design to produce a functional amphibious system of a kindthat had not been achieved before, by either qualified or unqualified engineers.121 High Court judgment, above n 2, at [400].122 At [361].[176] We consider that the Judge's reasoning, in particular the implications of theembodiment of an "original idea" in a copyright work, stemmed from a conflation ofMr Bryham's idea with its expression in the leg assemblies. It was in that sameparagraph123 that the Judge went on to say that the same fundamental design decisionand "solutions" developed by Sealegs had to have been adopted by Mr Zubcic.[177] In our view the Judge's failure to distinguish between Mr Bryham's idea andsuch copyright as subsisted in its expression in the leg assemblies had the consequencethat expert evidence as to independent design affording an explanation which mightrebut the inference of copying was erroneously excluded from consideration.Undue reliance on credibility issues?[178] The appellants contended that the Judge placed undue reliance on credibilityfindings rather than on the expert evidence as to differences between systems and thepursuit of an independent design path. It necessarily follows from our conclusions asto the relevance of the appellants' expert evidence that such evidence was accordedrelatively less significance than the Judge's conclusions on the credibility of theappellants' witnesses.[179] However while the appellants' expert evidence was given less thanproportionate significance by reason of the Judge's approach, that evidence wasopinion evidence as to whether a conclusion of independent design was available inthe circumstances. It was evidence which needed to be weighed with the otherevidence which led the Judge to make credibility findings against the appellants.However those credibility findings are not challenged for the purpose of the appeal.[180] So while we consider that the exclusion of the expert evidence resulted in therebeing undue reliance on the credibility findings, it does not follow that the Judge'sconclusion would necessarily have been different if the expert evidence had been takeninto account. Our conclusion on this issue is not to be read as suggesting otherwise.123 At [361].Result[181] The appeal is allowed. The orders in the High Court are set aside.[182] The respondent must pay the appellants one set of costs for a complex appealon a band B basis plus usual disbursements. We certify for second counsel.Solicitors:Keegan Alexander, Auckland for AppellantsWoodroffe Law Partnership, Auckland for Respondent