Ruling opens the door to protecting room design under the Copyright Act

On 13 October 2022, the IP and Commercial Court issued a ruling on a completely novel issue in Taiwanese IP litigation: copyright of interior design. While it remains to be seen whether the decision will be appealed, it acts as a significant reference for the issue.

The case was first brought by LDC Hotels & Resorts in 2014 against Sheraton Taitung Hotel, with regard to the interior design of the latter’s hotel rooms. LDC argued that Sheraton Taitung’s actions constituted copyright infringement under Taiwan’s Copyright Act and were a violation of the Fair Trade Act.

Case background

LDC asserted that Sheraton Taitung copied the unique interior designs of hotel rooms at the Palais de Chine, a five-star hotel that it owned and operated. It claimed that Sheraton’s chairman had stayed in the hotel for two nights, after which Sheraton Taitung was renovated. While these changes were taking place, the chairman and several personnel returned to the Palais de Chine, taking photos and measurements of multiple rooms. LDC ultimately argued that interior design falls under the label of ‘architectural work’, set out in the Copyright Act. 

In response to LDC’s claims, Sheraton Taitung presented three main arguments. First, the chairman only stayed at Palais de Chine to observe the interior design, which is standard practice in the industry, and that only part of the furniture was used as a reference for future purchases. Second, hotel room interior design does not fall within the scope of ‘architectural work’ under the Copyright Act, as this definition refers to a building’s structure and exterior appearance. Third, it claimed that most of Palais de Chine’s room designs were either imitations of foreign designs or were fairly common configurations in the industry. Therefore, LDC’s designs lacked originality and could be easily replicated by accident.

Previous court decisions

There have been three relevant rulings in this case before the most recent decision:

• the first-instance ruling issued by the IP and Commercial Court on 14 September 2018;
• the second-instance ruling by the same court issued on 19 September 2019; and
• a Supreme Court ruling issued on 20 January 2021.  

The first and second-instance rulings both held that the Copyright Act can indeed protect interior design, as this falls within the scope of what is considered architectural work. However, the two rulings reached different conclusions with regard to LDC’s copyright claim. The first-instance ruling held that the copyrightable creative work is the interior design “of Palais de Chine as a whole” – the design of individual hotel rooms cannot independently qualify for copyright protection. The second-instance ruling adopted a different view: the interior design of individual hotel rooms can in fact be protected as architectural work. Based on this, the court compared the design and layout of the hotel rooms and ruled that Sheraton Taitung had indeed copied and infringed the interior design of Palais de Chine’s hotel rooms.       

Sheraton Taitung appealed this finding at the Supreme Court, which remanded the case, stating that further investigation was required. It should be noted that the Supreme Court did not disagree with the previous conclusion that interior design may be protected under the Copyright Act. The October 2022 ruling was another second-instance review, made as a result of the remand.

The IP and Commercial Court’s decision

The October 2022 ruling reaffirmed that interior design can be protected as architectural work, but in this instance, the IP and Commercial Court adopted a new methodology to compare the hotel rooms. Furniture, decorations, and commonly seen room arrangements would be excluded from the scope of protection. Based on this approach, the ruling found that while the furniture and decorations of Palais de Chine’s hotel rooms were original, they were irrelevant when considering the definition of ‘architectural work’ and thus could not be protected under the Copyright Act. Further, the design of rooms was found to follow the typical room layout seen throughout the hotel business, so this also did not quality as copyrighted architectural work. In sum, LDC’s claims of copyright infringement were unfounded.

Looking ahead

From these court rulings, it seems that the scope of what constitutes ‘architectural work’ under the Copyright Act has been broadened to include interior design. However, the variety of approaches taken highlight that the specific methodology used to compare is still far from mature. Despite uncertainties at this stage of the dispute, the way that the comparative approach has developed throughout the case will have significant implications for similar future cases.