FEDERAL COURT OF AUSTRALIA

Geneva Laboratories Limited v Nguyen [2014] FCA 1270

THE COURT ORDERS THAT:

1.    The first to fourth respondents’ application filed 15 September 2014 be dismissed with costs.

Note:    Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules 2011.

THE COURT ORDERS THAT:

1.    The respondents’ application filed 12 September 2014 be dismissed with costs.

Note:    Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules 2011.

REASONS FOR JUDGMENT

background to applications

1    The applicant is the registered owner in Australia of four trade marks used to identify the skin care product “Bio-Oil”. Bio-Oil is used on scars, stretch marks, uneven skin tone and ageing and dehydrated skin, and is sold around the world. The applicant’s trade marks are applied to Bio-Oil’s packaging and bottles.

2    The applicant claims to have discovered counterfeit “Bio-Oil” products for sale in Australia by some (but not all) of the respondents. The respondents are allegedly owners and operators of pharmacies in the Sydney area. The discoveries follow the seizure by Customs of a quantity of counterfeit “Bio-Oil” in March 2014, and the consequent proceedings in this Court against the importer (“United Prestige”). In June 2014, counsel for United Prestige informed the Court that the seized goods were agreed to be counterfeit and would be destroyed.

3    On 16 July 2014, the applicant commenced these proceedings seeking relief that included, variously, declarations of contraventions of s 120 of the Trade Marks Act 1995 (Cth) (“Trade Marks Act”), ss 37 and 38 of the Copyright Act 1968 (Cth) and s 18 of Schedule 2 to the Competition and Consumer Act 2010 (Cth) (“Competition and Consumer Act”), and an inquiry into damages suffered by the applicant by reason of the respondents’ conduct.

Search and seizure and delivery up orders

4    On 17 July 2014, the applicant applied for and obtained ex parte orders in both proceedings. Copies of the orders are annexed to these reasons.

5    The orders were made pursuant to rule 7.42 of the Federal Court Rules 2011 (Cth) (“Rules”), by which the Court may make an order, with or without notice to the respondent, for the purpose of securing or preserving evidence.

6    In proceedings NSD710 of 2014 (“Nguyen proceeding”), the parties were required, among other things, to deliver up to the Court all 60 ml and 200 ml bottles of products in their possession which applied registered trade marks owned by the applicant, including the word “Bio-Oil”, or substantially identical or deceptively similar marks.

7    In proceedings NSD711 of 2014 (“Oze Pharmacy proceeding”), a search order was made. The order permitted the applicant to search and seize relevant goods at a shop and two storage facilities in Castle Hill, New South Wales.

Compliance with the orders

8    In the Nguyen proceeding, the first and second respondents delivered up a total of 15 bottles of product to the Court on two separate occasions. The first respondent also swore affidavits disclosing matters required to be disclosed by the orders, including purchases of 96 bottles of “Bio-Oil” from United Prestige in October and November 2013.

9    The third respondent in the Nguyen proceeding swore an affidavit on his behalf and on behalf of the fourth respondent saying that they had no relevant products in their possession. He also disclosed purchases of 192 units of “Bio-Oil” 60ml and 1,526 units of “Bio-Oil” 200ml from United Prestige.

10    7,920 products marked with the name “Bio-Oil” were seized from various of the Oze Pharmacy respondents. 28 samples were tested, marked with five different batch numbers. Based on that testing, the applicant claims that one of the five batches (12 of the 28 samples) was counterfeit.

Orders sought

11    In the Nguyen proceeding, the first to fourth respondents (“Nguyen respondents”) seek to have the orders made on 17 July 2014 and all subsequent orders discharged in so far as the orders were made against them. In the Oze Pharmacy proceeding, all respondents seek the same relief.

12    Both sets of respondents also seek to have the proceedings against them summarily dismissed.

13    The fifth to seventh respondents in the Nguyen proceeding have not sought interlocutory orders. Since the hearing of this interlocutory application, that proceeding has been discontinued as against the sixth respondent.

14    There is some overlap between the grounds relied upon by the various respondents, but the cases are not identical. Accordingly, after identifying the relevant legal principles, I will deal with the alleged inadequacy of disclosure by the applicants. I will then deal with the Oze Pharmacy respondents’ case that the orders should be set aside even if there was no lack of disclosure, and finally, the applications for summary dismissal.

Further background to the application

15    In support of the ex parte applications, the applicant relied on affidavits sworn by Christopher O’Toole, a solicitor employed by Marque Lawyers, the applicant’s solicitor. Mr O’Toole deposed to the following facts.

16    In May 2011, Marque Lawyers on behalf of the applicant lodged a notice of objection with the Australian Customs and Border Protection Service (“Customs”) pursuant to s 132 of the Trade Marks Act, in respect of one of its registered trade marks. (By s 132(1) of the Trade Marks Act, the registered owner of a registered trade mark may give to the Customs CEO a notice in writing objecting to the importation after the date of the notice of goods that infringe the trade mark.)

17    On 12 March 2014, the applicant was informed by Customs that it had intercepted a large consignment of “Bio-Oil”, pursuant to s 133 of the Trade Marks Act. The goods were identified by Customs as having been imported by United Prestige.

18    Customs provided Marque Lawyers with samples of the seized goods (“Customs samples”). Those goods were tested at the laboratory of Aspen Pharmacare Australia Pty Ltd (“Aspen”) in Baulkham Hills. Aspen is the exclusive distributor of Bio-Oil in Australia and has sold Bio-Oil in Australia since 2008.

19    An infrared spectroscopy analysis was conducted on the Customs samples and on control samples obtained from Aspen’s head office. The analysis was said to confirm that each of the Customs samples had a significantly different infrared spectra to the control samples, resulting in a conclusion that the Customs samples and the control samples were not the same product. The report of the analysis (“Customs technical report”) observed “that the spectra of the Customs samples are completely lacking in detail and are remarkably similar to paraffin oil which…is often used as a medium for presenting solid compounds for infrared analysis and is thus very familiar to anyone experienced with infrared spectrometry”. The report concluded that “both sets of samples contain paraffin, however, in terms of organic components, the Customs samples appear to contain little else with a near perfect spectra match between the samples and straight paraffin liquid”.

20    On 2 April 2014, the applicant commenced proceedings against various entities including United Prestige Group Pty Ltd (“United Prestige respondents”).

21    On 3 April 2014, Yates J made orders including orders requiring the United Prestige respondents to disclose each and every importation of Bio-Oil or any product to which there was applied substantially similar or deceptively similar marks to the applicant’s trade marks.

22    On 3 July 2014, the United Prestige respondents served an affidavit which showed that one or more of them had sold Bio-Oil to pharmacies in NSW including pharmacies operated by various of the respondents in these three proceedings.

23    Between 26 June and 7 July 2014, Mr O’Toole made or caused to be made the following purchases of products marked as “Bio-Oil” (“trap purchases”):

(1)    One 200ml product from a pharmacy owned and operated by the first and second respondents in the Nguyen proceeding and two 200ml products from a pharmacy owned and operated by the third and fourth respondents in the Nguyen proceeding. Each of these products was marked with the batch number BNB321360;

(2)    12 60ml and 200ml products from two pharmacies trading under the Oze-Pharmacy name. The 60ml products were marked with the batch number BNB980893. The 200ml products were marked with the batch number BNB321360.

24    Marque Lawyers sent samples of the trap purchases to Aspen. An infrared spectroscopy analysis, of the same kind undertaken on the Customs samples, was conducted on the trap purchase samples. The analysis concluded that the samples marked with the batch numbers BNB321360 were primarily made up of paraffin oil and had a significantly different infrared spectra to control samples, resulting in a conclusion that the 200ml trap purchase samples and the control samples were not the same product. The 60ml trap purchase samples were found to match the control sample.

25    Annexed to affidavits made by Mr O’Toole were technical reports recording this analysis. A separate report was prepared for each proceeding. The technical report in the Nguyen proceeding (“Nguyen technical report”) concluded:

All samples are found to be not comparable to the Aspen reference batch. It is apparent that, in terms of organic components, the samples contain primarily paraffin oil and other organic compounds present in the Aspen reference sample are either not present or are present in a concentration so low as to conclude that the samples are not equivalent.

The technical report in the Oze Pharmacy proceeding (“Oze Pharmacy technical report”) concluded:

Sample BNB980893 (Box No.2) is considered to be similar to the Aspen reference sample however samples of BNB321360 taken from boxes 6 and 11 are not considered to be the same as the Aspen reference. It is apparent that, in terms of organic components, the samples from BNB321360 contain primarily paraffin oil and other organic compounds present in the Aspen reference sample are either not present or are present in a concentration so low as to conclude that the samples are not equivalent

Based on these reports, Mr O’Toole deposed that the 200ml trap purchase samples were not manufactured by or for and on behalf of the applicant.

26    The technical reports were written by Jeff Cooper, a site manager employed by Aspen and responsible for supervising the infrared spectroscopy testing. Mr Cooper was also the author of the Customs technical report. Mr O’Toole said:

I am informed by Mr Cooper and verily believe that he has undertaken the Infrared Spectroscopy test as a laboratory analyst and supervised the Infrared Spectroscopy test as laboratory manager on many occasions throughout his 25 year career in the Pharmaceutical industry.

27    Copies of Mr Cooper’s curriculum vitae were included in the exhibits to Mr O’Toole’s second affidavit in each of the proceedings.

28    The control sample used by Mr Cooper for analysis of the trap purchases was one of the control samples used in the analysis of the Customs samples (batch number BNB161277). The Nguyen technical report stated that a “visual examination of the spectra makes it immediately obvious that the sample consists primarily of paraffin oil and is lacking detail in the fingerprint region where other components normally present in Bio-Oil would be observed and are clearly present in the reference sample”. This observation may be compared to the observations contained in the Customs technical report, and set out at [19] above.

29    The report on the Oze Pharmacy samples is similar, except that the sample of BNB980893 was found to match the Aspen reference sample.

Legal principles

Trade marks and counterfeit products

30    A trade mark is a “sign” used, or intended to be used, to distinguish goods or services dealt with or provided in the course of trade by a person from goods or services so dealt with or provided by any other person: Trade Marks Act, s 17. A “sign” includes, relevantly, any name device, brand or aspect of packaging: Trade Marks Act, s 6. Consumers have an interest in recognising a trade mark as a badge of origin of goods or services and in avoiding deception or confusion as to that origin. Traders have interests, both in protecting their goodwill through the creation of a statutory species of property protected by the action against infringement, and in turning this property to valuable account by licensing or assignment: Campomar Sociedad Limitada v Nike International Ltd (2000) 202 CLR 45 at [42].

31    The following passage, from Bosland et al, “Trade Mark and Counterfeit Litigation in Australia” [2006] UMelb LRS 3, sets out clearly the significance to trade mark owners of addressing and obtaining remedies for counterfeiting activity:

Counterfeiting activity falls within the core of that conduct which trade mark owners are entitled to prevent. The negative effects of counterfeiting are substantial. They include (a) direct losses to the trade mark owner (ie lost sales); (b) the costs entailed by the deception of consumers, (c) indirect losses to the trade mark owner (for example, loss of reputation for quality, loss of ‘prestige’ value), (d) the costs of enforcement incurred by trade mark owners and governments alike, and (e) the ‘social losses’ – lost jobs, lost tax revenue, and lost investment in research and development that may arise as a result of the lost revenue.

Power to make a search order

32    Rule 7.42 of the Federal Court Rules 2011 (Cth) (“Rules”) provides:

The Court may make an order (a search order), in any proceeding or in anticipation of any proceeding in the Court, with or without notice to the respondent, for the purpose of securing or preserving evidence and requiring a respondent to permit persons to enter premises for the purpose of securing the preservation of evidence that is, or may be, relevant to an issue in the proceeding or anticipated proceeding.

33    Rule 7.43 of the Rules provides:

The Court may make a search order if the Court is satisfied that:

(a)     an applicant seeking the order has a strong prima facie case on an accrued cause of action; and

(b)     the potential or actual loss or damage to the applicant will be serious if the search order is not made; and

(c)     there is sufficient evidence in relation to a respondent that:

(i)     the respondent possesses important evidentiary material; and

(ii)     there is a real possibility that the respondent might destroy such material or cause it to be unavailable for use in evidence in a proceeding or anticipated proceeding before the Court.

34    Practice Note CM 11 addresses the Court’s usual practice relating to the making of a search order and the usual terms of such an order.

Power to discharge or set aside orders

35    The ex parte orders were entered the same day. By rule 39.05 of the Rules, the Court may vary or set aside an order after it has been entered if, among other things:

(a)    it was made in the absence of a party; or

(b)    it was obtained by fraud; or

(c)    it is interlocutory; or

(d)    it is an injunction or for the appointment of a receiver; or

(e)    it does not reflect the intention of the Court.

36    The Court probably also has an inherent jurisdiction to set aside or discharge an order obtained ex parte, even though it is a statutory court: cf Owners of SS Kalibia v Wilson (1910) 11 CLR 689 at 694; Taylor v Taylor (1979) 143 CLR 1 at 16 (Mason J).

37    In JC Techforce v Pearce (1996) 138 ALR 522 at 529 (“JC Techforce”), Branson J referred to the predecessor to rule 39.05 as providing “a procedure whereby a respondent to an ex parte application may seek review of the decision to make an order”. Her Honour noted that the most common ground for setting aside an order obtained ex parte is that such order was obtained in circumstances of inadequate disclosure to the court.

Disclosure and the duty of candour

38    In Walter Rau Neusser Oel Und Fett AG v Cross Pacific Trading Ltd [2005] FCA 955 at [38], Allsop J said:

In an ex parte hearing, it is the obligation of the party seeking orders, through its representatives, to take the place of the absent party to the extent of bringing forward all the material facts which that party would have brought forward in defence of the application: Thomas A Edison Ltd v Bullock (1912) 15 CLR 678 at 681-82 per Isaacs J. That does not mean stating matters obliquely, including documents in voluminous exhibits, and merely not mis-stating the position. It means squarely putting the other side’s case, if there is one, by coherently expressing the known facts in a way such that the Court can understand, in the urgent context in which the application is brought forward, what might be said against the making of the orders. It is not for the Court to search out, organise and bring together what can be said on the respondents’ behalf. That is the responsibility of the applicant, through its representatives…

39    At [47] and [48], his Honour continued:

The high standard of candour and the heavy responsibility on those who seek ex parte orders is especially the case where (as it was here, and as will often be the case) a discretion is involved. The judge must be given the opportunity of analysing the facts from the perspective of any available case which can be put, or anticipated to be put, by the absent party…

As the Full Court said in Town & Country v Partnership Pacific (1998) 20 FCR 540 at 543:

The rationale behind the principle is clear; it is of the utmost importance in the due administration of law that the Courts and the public are able to have confidence that an ex parte order has been made only after the party obtaining it has complied with its duty to disclose all relevant facts.

40    In Hayden v Teplitzky (1997) 74 FCR 7 at 12, Lindgren J said:

The importance of the obligation to make full and frank disclosure can scarcely be overemphasised. Prima facie, breach of it entitles a defendant to an immediate discharge of the injunction and restoration of the position which obtained before it was granted.

41    In Garrard (t/as Arthur Anderson & Co) v Email Furniture Pty Ltd (1993) 32 NSWLR 662 at 678 (“Garrard”), Mahoney AP (Clarke JA agreeing) said:

It is, in my opinion, important that the extent of the duty (“a most serious responsibility”) imposed upon a person applying to a court ex parte be not qualified and that failure to observe that duty be properly sanctioned. The principle is stated by Isaacs J [in Thomas A Edison Ltd v Bullock (1912) 15 CLR 679 at 682] in terms indicating that an order obtained in breach of it will “almost invariably” be set aside.

42    Practice Note CM11 provides:

An applicant for a search order made without notice is under a duty to the Court to make full and frank disclosure of all material facts to the Court. This includes disclosure of possible defences known to the applicant.

Rehearing of application for ex parte orders

43    A separate basis for setting aside an ex parte order is that, on a review with the benefit of evidence and submissions from the respondent, it appears that the order should not have been made. In WEA Records Ltd v Visions Channel 4 Ltd [1983] 1 WLR 721 at 727 (“WEA Records”), Donaldson MR (Dunn LJ and Purchaes LJ agreeing) said:

…ex parte orders are essentially provisional in nature. They are made by the Judge on the basis of evidence and submissions emanating from one side only. Despite the fact that the applicant is under a duty to make full disclosure of all relevant information in his possession, whether or not it assists his application, this is no basis for making a definitive order and every Judge knows this. He expects at a later stage to be given an opportunity to review his provisional order in the light of evidence and argument adduced by the other side and, in so doing, he is not hearing an appeal from himself and in no way feels inhibited from discharging or varying his original order.

44    In Savcor Pty Ltd v Catholic Protection International APS (2005) 12 VR 639, the Victorian Court of Appeal considered an appeal from an ex parte order extending the validity of a writ. At [21], Gillard AJA (Ormiston and Buchanan JJA agreeing) said that the jurisdiction to set aside an order made without notice “gives the right to the party affected by the order to appear before the court and put submissions as to why the order should not be made on the materials which were before the judge who made the first order”.

45    At [22], Gillard AJA continued:

In my opinion, this jurisdiction is different to the situation when an order made ex parte is set aside because there was a material non-disclosure of a material matter by the party who obtained the order. The order is set aside because of some irregularity and not on the merits. When this jurisdiction is enlivened, the court’s function is to determine on the material that was placed before the judicial officer at first instance, whether a party has failed to discharge the obligation which rests upon any party seeking an order ex parte, namely, making a full and fair disclosure of all matters within its knowledge and which are material, to the court. The court is not concerned whether the order should have been made on the material before the court. Whether or not the court will set aside the order upon proof of the failure to discharge the obligation depends upon the particular circumstances.

Discretionary considerations

46    Despite Mahoney AP’s statement in Garrard, there is no absolute right to have an ex parte order set aside; there is a discretion in the court whether to do so or not: Dormeuil Frères SA v Nicolian International (Textiles) Ltd [1988] 3 All ER 197 at 199 (“Dormeuil”).

47    In Dormeuil, Browne-Wilkinson VC expressed the view that the appropriate time for the court to hear and determine an application to discharge a search order on the ground that it was obtained as a result of material non-disclosure is at the trial because, the order usually having been executed, the only consequence of the non-disclosure will be to affect the plaintiff’s liability under his undertaking as to damages, and interlocutory proceedings are not the appropriate time for the court to hear evidence and determine allegations of what has happened in the past.

48    In Dart Industries v Bryar (1997) 38 IPR 389 at 419, Goldberg J, agreeing with Browne-Wilkinson VC, said that “save in exceptional cases it is not the correct procedure to apply to discharge an ex parte injunction on the grounds of lack of full disclosure at the interlocutory stage of the proceedings”. Goldberg J also accepted “the tentative view expressed by Sir Nicholas Browne-Wilkinson VC in Tate Access Floors Inc v Boswell [[1991] Ch 512 at 532-3] that investigations of the circumstances in which an ex parte Anton Piller [or search] order was granted should be restricted to those cases where there has been a serious failure to make a material disclosure”. His Honour declined to discharge the search order in that case. See also Liberty Financial Pty Ltd v Scott [2002] FCA 345 at [71].

49    In WEA Records Ltd, Donaldson MR said at 727:

In the instant case the Anton Piller order is spent in the sense that it has been executed. However, the defendants seek to go back to the beginning of the action saying that, regardless of whether the fruits of the order are such as to show that it was abundantly justified, the judge had insufficient material to justify his action at the ex parte stage. They therefore invite us to set the ex parte order aside and to order the return of the …seized material …

I regard this as wholly absurd. The courts are concerned with the administration of justice, not with playing a game of snakes and ladders. If it were now clear that the defendants had suffered any injustice by the making of the order…the defendants would have their remedy in the counter-undertaking as to damages. But this is a matter to be investigated by the High Court judge who is seised of the matter…

50    In Brags Electrics Pty Ltd v Gregory [2010] NSWSC 1205, Brereton J declined to set aside an Anton Piller order. At [17], he summarised the relevant principles as follows:

First, where an Anton Piller order is made ex parte (as it ordinarily will be), an applicant to set the order aside bears an onus of showing some reason why it should be set aside. However, it may be a sufficient reason to set aside the order that the grounds for such an order were not satisfied. Secondly, where such an application is made on the ground that there has been bad faith or material non-disclosure, then the court may set aside the order ab initio, but otherwise a discharge will operate in futuro only. Thus, where an application is made to set aside or discharge the order on the basis that the grounds for making such an order were not established, that will be of little utility if made after the order has been executed. At least in the absence of bad faith or non-disclosure, the remedy for a defendant where it is shown ultimately that an Anton Piller order ought not have been made, is not to have the order set aside, but pursuant to the undertaking as to damages. Thirdly, on an application to set aside an Anton Piller order, the court may take into account on the hearing of the application the “fruits of the order” – that is to say, any evidence or admission procured as a result of the order – and any further evidence adduced in the meantime.

51    In Campaign Master (UK) Ltd v Forty Two International Pty Ltd (No 4) (2010) 269 ALR 76 at [69], Yates J said (albeit not in the context of an application to set aside an ex parte application):

…even in the case of orders of a procedural nature, the principle of finality of litigation does have a role to play which, having regard to considerations of case management, is not unimportant. It is to be borne in mind that the civil practice and procedure provisions respecting this court, including its rules made under the Federal Court of Australia Act, must be interpreted and applied, and every power conferred by them must be exercised or carried out, in the way that best promotes the overarching purpose identified in s 37M of the Act of facilitating the just resolution of disputes according to law as quickly, inexpensively and efficiently as possible. That overarching purpose will not be achieved, but will be subverted, by a too-ready resort to, or incautious application of, the power to vary or set aside orders that have been made and entered, even where the orders are of a procedural nature.

52    In JC Techforce, Branson J identified the following two factors “telling against the exercise of the discretion” to set aside a search order, after the order had been executed:

(1)    the failure of the respondents to identify any utility which would result from the setting aside of the order;

(2)    the delay (of three months) which attended the making of the application.

Summary dismissal

53    Section 31A(2) of the Federal Court Act 1976 (Cth) provides:

(2)    The Court may give judgment for one party against another in relation to the whole or any part of a proceeding if:

(a)     the first party is defending the proceeding or that part of the proceeding; and

(b)     the Court is satisfied that the other party has no reasonable prospect of successfully prosecuting the proceeding or that part of the proceeding.

54    Rule 26.01(1) of the Rules provides, relevantly, that a party may apply to the Court for an order that judgment be given against another party because that proceeding is frivolous or vexatious, or an abuse of the process of the Court.

55    Other grounds for summary dismissal are that the applicant has no reasonable prospect of successfully prosecuting the proceeding or part of the proceeding, or no reasonable cause of action is disclosed.

56    A matter is frivolous and vexatious where the “cause of action is one which on the face of it is clearly one which no reasonable person could properly treat as bona fide, and contend that he had a grievance which he was entitled to bring before the Court.”: Norman v Matthews (1916) 85 LJKB 857 at 859.

57    Proceedings may be an abuse of process if brought for a collateral purpose. The essential question for determination is whether or not the proceedings, and the particular claims made in them, are genuinely intended to be determined in the proceedings: Flower & Hart v White Industries (Qld) Pty Ltd (1999) 87 FCR 134 at [64]. Proceedings may also be an abuse of process if they have no real prospect of resulting in a substantial remedy and involve unjustifiable expense and use of judicial resources. Alternatively, a significant disproportion between the judgment amount and the costs of the proceedings may justify depriving an otherwise successful plaintiff of a usual costs order: Jones v Sutton (No 2) [2005] NSWCA 203.

58    The power to dismiss a proceeding for abuse of process is “an exceptional power which ought to be sparingly exercised and only in exceptional cases”: Sea Culture International Pty Ltd v Scoles (1991) 32 FCR 275 at 279.

59    The general rule is that the power to dismiss proceedings summarily should be exercised with caution: Spencer v Commonwealth (2010) 241 CLR 118 at [24]; Macquarie Bank Limited v Commissioner of Taxation [2013] FCAFC 119; Spirits International BV v Federal Treasury Enterprise (FKP) Sojuzplodoimport [2013] FCAFC 106 at [32]; Ghanem v Australian Research Council [2014] FCAFC 132 at [19].

Genuine steps

60    Rule 8.02(1) of the Rules provides:

(1)      If Part 2 of the [Civil Dispute Resolution Act 2011 (Cth) (“Civil Dispute Resolution Act”)] applies to a proceeding, the applicant must, when filing the applicant's originating application, file the applicant's genuine steps statement, in accordance with Form 16.

(2)      The applicant's genuine steps statement must comply with section 6 of the Civil Dispute Resolution Act.

61    Part 2 of the Civil Dispute Resolution Act applies to these proceedings, which are not ex parte proceedings (although ex parte applications were made in the proceedings). Section 6(2) of that Act provides relevantly:

(2)      A genuine steps statement… must specify:

(a)      the steps that have been taken to try to resolve the issues in dispute between the applicant and the respondent in the proceedings; or

(b)      the reasons why no such steps were taken, which may relate to, but are not limited to the following:

(i)      the urgency of the proceedings;

(ii)      whether, and the extent to which, the safety or security of any person or property would have been compromised by taking such steps.

62    Section 11 of the Civil Dispute Resolution Act provides that the Court may, in performing functions or exercising powers in relation to civil proceedings before it, take account of the following:

(1)    whether a person who was required to file a genuine steps statement under Part 2 in the proceedings filed such a statement;

(2)    whether such a person took genuine steps to resolve the dispute.

Evidence

Nguyen respondents

63    The Nguyen respondents relied on the following affidavits:

(1)    Three affidavits of Steve Nguyen sworn 23 July, 12 August and 19 August 2014;

(2)    Two affidavits of John Nguyen affirmed 19 and 28 August 2014;

(3)    An affidavit of Tania Hoang sworn 22 August 2014;

(4)    Three affidavits of Jeffrey Lee affirmed 12 September 2014 (two affidavits) and 29 September 2014.

64    By affidavit dated 19 August 2014, the first respondent gave evidence that, had he or his wife (the second respondent) been informed at any time prior to 21 July 2014 that there was a possibility that any “Bio-Oil” product they had bought from United Prestige was not a genuine product, they would have ensured that it was immediately removed from sale at their pharmacies until the matter was resolved. More particularly, had they been asked by the applicant for a sample of any “Bio-Oil” product purchased from United Prestige on the basis that there was a possibility that it was not genuine, they would have provided the applicant with samples for testing, and would have removed the remaining product from the shelves until the matter was satisfactorily resolved.

65    The third respondent swore an affidavit to similar effect on behalf of himself and the fourth respondent.

Oze Pharmacy respondents

66    The Oze Pharmacy respondents relied on an affidavit sworn by their solicitor Peter Clinch on 7 October 2014.

Applicant

67    The applicant relied on the following:

(1)    Two affidavits of Mr O’Toole sworn on 16 July 2014 in each of the proceedings; and

(2)    Two affidavits of Nathan Mattock sworn 2 October 2014 in the Nguyen proceeding and one sworn on 2 October 2014 in the Oze Pharmacy proceeding.

adequacy of disclosure

Alleged non-disclosures

68    The Nguyen parties identified the following four matters as the subject of inadequate disclosure by the applicant at the 17 July 2014 hearing:

(1)    There was no prima facie case against them, because:

(a)    The trap purchases were not counterfeit;

(b)    The technical report was not admissible and was flawed;

(2)    The Court was misled as to the significance of paraffin oil as an ingredient in the allegedly counterfeit product;

(3)    The quantities of allegedly counterfeit products involved were trivial; and

(4)    The application was not urgent.

69    The Oze Pharmacy respondents identified 15 matters as relevant non-disclosures, falling into the following categories:

(1)    Insufficiency of the evidence to support the ex parte orders;

(2)    Facts concerning the respondents, relevant to the unlikelihood that they might destroy evidence or cause it to be unavailable for use in evidence;

(3)    Facts concerning the market for Bio-Oil in Australia, relevant to the strength of the applicant’s prima facie case; and

(4)    Facts about disputes between Aspen and United Prestige over distribution of Bio-Oil in Australia.

70    For the following reasons, I do not accept that the applicant breached its duty of candour or otherwise failed to disclose any material matter when seeking the ex parte orders.

Mr Cooper’s technical reports

71    The Nguyen parties made the following complaints:

(1)    The applicant did not “point out” to the Court that the author of the Nguyen technical report was not a lab technician. In particular, they referred to the following statement by counsel for the applicant, Mr Casselden, at the ex parte hearing:

…we have this situation where the samples all contain primarily paraffin oil, which is consistent with what Mr Cooper, the lab technician found in the Geneva Bio-Oil proceedings (T14 line 24).

(2)    It was also not pointed out that the author of the report was not “from a laboratory”;

(3)    Mr Casselden wrongly submitted that “samples of the Bio-Oil purchased were then sent for laboratory testing and comparison against genuine Bio-Oil” (T3 lines 23 to 24);

(4)    Mr Cooper was in a position of “hopeless conflict” by reason of his employment with Aspen, Bio-Oil’s exclusive distributor in Australia; and

(5)    The report was not adequately reasoned.

72    The Oze Pharmacy respondents contended that:

(1)    The Oze Pharmacy technical report was inadmissible;

(2)    The report was not independent;

(3)    The report was deficient in that it failed to test the Aspen control sample against paraffin oil.

73    I do not accept that there was any material non-disclosure by the applicant. The applicant did not present Mr Cooper as an independent expert. The authorship of the report was clearly identified on its face, and the relationship between the applicant and Aspen was clearly identified in Mr O’Toole’s affidavit. Mr Cooper’s position as site manager of Aspen did not prevent his report from being tendered or being given considerable weight on the question of whether there was a strong prima facie case: cf R v Gallagher [2001] NSWSC 462 at [138] to [139]. The requirement to make full and frank disclosure is directed towards the disclosure of material facts, including possible defences. The relevant facts were disclosed. The applicant was not required to identify all possible submissions that the respondents, if present, might have made.

74    It is important to bear in mind that the question for determination on 17 July 2014 was whether there was a strong prima facie case that the relevant goods were counterfeit. The Court was not required to decide, and did not decide that the goods were counterfeit. In this context, it was not fatal that Mr Cooper’s reports did not explain the benchmark of 95% said to establish that the products are genuine Bio-Oil. In any event, this was not a matter about which there was any lack of disclosure: it is apparent on the face of the reports. The applicant had previously demonstrated the counterfeit nature of “Bio-Oil” products through testing to the satisfaction of the importer, United Prestige. There was evidence presented on the ex parte application that Mr Cooper supervised the earlier analysis and wrote the technical report of that analysis. The evidence was that Mr Cooper used the same test methodology and benchmark to test the goods seized by Customs and acknowledged by the importer to be counterfeit. In that context, in my opinion, the technical reports prepared by Mr Cooper were sufficient to demonstrate the requisite strong prima facie case that the goods tested were counterfeit even without an explanation of the selected benchmark.

75    Contrary to the submission by the Oze Pharmacy respondents, non-compliance with rules 23.12 and 23.13 of the Rules does not automatically render an expert report inadmissible: Dasreef Pty Ltd v Hawchar (2011) 243 CLR 588 at [64].

76    As to the Nguyen parties’ first complaint set out above, it is correct that Mr Cooper was the author of the Nguyen technical report, rather than a lab technician. He was not the only person involved in the creation of the report. On its face, the report appears to have been checked by a “QA manager”. The report contains “spectra comparison results” which appear each to have been signed by two individuals, including a named person designated “operator”. The “operator” might accurately be referred to as a lab technician.

77    I do not consider it to be a material fact that Mr Cooper is not a lab technician. There is no evidence to suggest that the evidence in the technical report could only be given by a lab technician, if it could be given by a lab technician at all. On the available evidence, Mr Cooper has tertiary qualifications as a chemist, with extensive experience in the pharmaceutical industry. He has had lengthy experience in roles described as “senior chemist/laboratory team leader” and “laboratory supervisor”. The important fact, to which Mr Casselden drew attention, was that Mr Cooper was the author of a report relied on in the proceeding against the United Prestige respondents to demonstrate the counterfeit nature of the goods seized by Customs in March 2014.

78    The duty of candour did not require Mr Casselden to correct his description of Mr Cooper as a lab technician since it was not a material description.

79    As to the Nguyen parties’ second complaint, I do not understand the submission that Mr Cooper is not “from a laboratory”. His role as site manager at the Aspen Baulkham Hills facility included responsibility for all aspects of running the facility, which plainly included a laboratory. The description “from a laboratory” is not inapt. Mr Casselden was under no obligation to anticipate that Mr Cooper’s qualifications to author the report might be disputed by the Nguyen parties on this basis.

80    As to the Nguyen parties’ third complaint, there is no evidence that Mr Casselden’s statement at T3 lines 23 to 24 is not correct. A “laboratory” is a place equipped for scientific experiments. On the face of the report, it appears that samples were sent to a place where a scientific experiment was conducted using a named instrument, and analysis was performed “by a laboratory analyst with documented training records in the use of this specific instrument”. The samples were compared to a control sample of genuine Bio-Oil. I can detect no basis for criticising this statement.

81    In my view, none of the respondents’ criticisms of the technical reports or the manner of their presentation demonstrate any inadequate disclosure by the applicant.

Whether Court was misled about paraffin content of products.

82    The Nguyen parties alleged that Mr Casselden misled the Court when he said:

The test results indicate that the test samples are primarily made up of paraffin oil and have a significant different infrared spectra to genuine Bio-Oil, and are therefore not considered the same. That is, they are considered to be counterfeit.

83    The statement that the test samples were “primarily paraffin oil” was repeated twice.

84    The Oze Pharmacy respondents did not make a similar argument, but complained that the technical report had failed to test the control sample against paraffin oil so that the differences between paraffin oil and genuine Bio-Oil were not the subject of evidence.

85    The Nguyen parties submitted that the Court was misled into thinking that the trap purchase products “were fake because they contained paraffin oil”. It is not suggested that there was anything misleading about Mr Casselden’s submission above, except that it says the test samples were “primarily made up of paraffin oil”. The suggestion seemed to be that Mr Casselden should not have sought to distinguish the test samples on the basis that they were primarily made up of paraffin oil, when the same could be said of Bio-Oil itself.

86    However, that was a matter that was plain from the evidence before the Court. The Customs technical report, referred to at [19] above, noted that genuine Bio-Oil contains paraffin. Further, as the respondents themselves observed, the 95% benchmark tends strongly to suggest that genuine Bio-Oil contained a significant proportion of paraffin. Mr Casselden specifically drew attention to the following statement in the Nguyen technical report:

The seven (7) samples had correlation results in the range 92.43 – 93.78% which is below the threshold of 95.0% and it is thus concluded that they do not match the reference batch.

87    More importantly, Mr Casselden’s submission was based on the conclusions to the technical reports set out at [25] above. Mr Casselden’s statements that the samples were “primarily paraffin oil” were made in the context of identifying the key conclusion of the technical reports which included the correlation results. The Nguyen technical report noted that a spectral comparison was performed on the sample which had the highest correlation to the Aspen control sample using paraffin oil as the reference. The resulting correlation was 99.73% “indicating a near perfect spectral match”. It is apparent from all of the evidence that this is the sense in which the description “primarily paraffin oil” was used.

88    Mr Casselden’s submission was consistent with the language of the technical reports, and was shorthand for the submission, also available to be made on the evidence, that the test samples did not contain “other organic compounds present in the Aspen reference sample”. While it is possible that the points of difference between the test samples and the control samples could have been identified more precisely in oral submissions, this was not necessary because they were identified sufficiently in the technical reports.

Risk that evidence might be destroyed or become unavailable for use in evidence

89    The Oze Pharmacy respondents submitted that the evidence in support of the real possibility of destruction of evidentiary material was “effectively non-existent…There was no evidence before the Court…in the nature of concealment, deception or impropriety”. Conversely, it was argued, the applicant should have informed the Court that the respondents were operating a well-established business and there was no reason to doubt that they would comply with orders of the Court to deliver up documents without the need for a search and seizure order: cf Booker McConnell Plc v Plascow [1985] RPC 425 at 441; EFG Australia Ltd v Kennedy [1995] NSWSC 58.

90    The Oze Pharmacy respondents referred to the status of the respondents, who included registered pharmacists subject to professional standards. They submitted that it would be counterintuitive for the respondents to destroy any “Bio-Oil” stock when it may form the basis of a claim against their supplier in the event that the goods were not genuine.

91    In this case, the relevant risk arose primarily from the evidence of sale of goods about which there was strong evidence that the goods were counterfeit. That, of itself, gave rise to a strong case of liability for trade mark infringement. The risk also arose from the obvious possibility that a respondent in the situation of the Oze Pharmacy respondents, ordered to deliver up goods or documents, would make inquiries of their supplier who might take steps to destroy the relevant evidence or cause it to become unavailable. In that regard, I note an email dated 22 July 2014 purportedly from United Prestige annexed to the affidavit of the first respondent in the Nguyen proceeding dated 23 July 2014, to the following effect:

To all our customers,

URGENT!

It has come to our attention that some of our customers may have received either a letter of some sort of documents from Marque Lawyers acting on behalf of Geneva Laboratories in respect to commercial information concerning Bio Oil.

If you have received such a letter or papers, please let us know immediately by calling the number below or emailing the documents to us.

This email demonstrates the obvious possibility that United Prestige might have sought to influence the respondents or to affect their capacity to comply with an order for delivery up.

92    There was no evidence that the respondents were aware that they were in possession of counterfeit goods. It was also clear that the respondents were the owners and operators of pharmacies. There was also no evidence that the respondents were other than reputable pharmacists and pharmacy operators, apart from their possession of the relevant goods. However, the Court was not asked to draw any inference that was not supported by available evidence. In my view, the applicant was not required to provide additional detail of facts about the probity of the respondents, when its case on risk was put on the basis, and only on the basis, of the matters identified above.

93    In my opinion, the two matters set out at [91] above provided a sufficient basis to conclude that there was a real possibility that the respondents might destroy important evidentiary material or cause it to be unavailable for use in evidence. I do not agree that the applicant was required to inform the Court that, if present, the respondents might have argued that the case was not strong enough to justify the orders sought. The applicant’s duty of disclosure concerned material facts and relevant law, as opposed to possible submissions about the weight of the available evidence.

Trap purchase products not counterfeit

94    The Nguyen parties made a positive assertion that the trap purchases which supported the applications for ex parte orders were not purchases of counterfeit products. The Oze Pharmacy respondents questioned whether the products were counterfeit and contended that the evidence of non-equivalence of the products with the Aspen control samples was not sufficient to demonstrate that the goods were counterfeit.

95    The Nguyen parties did not adduce evidence to support the submission that the trap purchases were genuine Bio-Oil.

96    The Oze Pharmacy respondents submitted that there were “differing compositions of Bio Oil throughout the world” but did not adduce any evidence to support that submission. There was evidence from Mr Mattock, on information and belief from a director of the applicant, that the control samples of Bio-Oil manufactured by Aspen have the same composition as Bio-Oil sold in all other countries other than South Africa, Swaziland, Lesotho, Namibia and Botswana. He also said that the only ingredient in the Bio-Oil sold in these African countries which is different is a colour additive that gives the Bio-Oil a light pink colouration. The Bio-Oil sold in the rest of the world, including Australia, has an orange colouration.

97    The Nguyen parties referred to the embossing on the boxes and bottles with the message that they are distributed by Keyline Brands Ltd (“Keyline Brands”), an authorised distributor of Bio Oil. The submissions asserted that the fact of the embossing raised a defence under s 123 of the Trade Marks Act and indicated there is no misleading or deceptive conduct. Section 123 of the Trade Marks Act provides:

(1)      In spite of section 120, a person who uses a registered trade mark in relation to goods that are similar to goods in respect of which the trade mark is registered does not infringe the trade mark if the trade mark has been applied to, or in relation to, the goods by, or with the consent of, the registered owner of the trade mark.

98    I do not accept that the embossing on the boxes and bottles containing the trap purchases is evidence that the trap purchases are not counterfeit products. It simply raises a question about whether the purchases were distributed by Keyline Brands. For a defence under s 123, it would be necessary to demonstrate that the goods were in fact distributed by Keyline Brands with the consent of the registered owner of the trade mark, and not simply that they purported to be distributed by that entity.

99    At present, the only evidence before the Court concerning whether the relevant products are genuine is the applicant’s evidence that they are counterfeit. In my view, for the reasons set out below, the applicant was entitled to rely on that evidence to submit that there was a strong prima facie case that the respondents were selling counterfeit “Bio-Oil”. Accordingly, I reject the submission that the applicant should have made any different or additional submission about the provenance of the trap purchases.

Other matters raised by the Nguyen parties

Trivial quantities of counterfeit product

100    The Nguyen parties’ written submissions do not explain how the applicant’s duty of candour is said to have been breached in relation to quantities of counterfeit product. To the contrary, the written submissions refer to the following statement by Mr Casselden:

…we apprehend that if there’s any product that’s delivered up that it won’t be in large volumes….These operators seem to a large extent to be small and from observations made by Mr Toole, they don’t seem to stock a great deal of the product on their shelves.

101    Although not referring to the duty of candour, the written submissions contend that the applicant’s conduct in bringing the proceedings:

…is of a kind which brings the legal profession into disrepute, significantly undermines the efficient disposal of litigation, and has the potential to erode public confidence in the administration of justice in this country: [Superior IP International Pty Ltd v Ahearn Fox Patent and Trade Mark Attorneys [2012] FCA 282 at [9] (“Superior IP”)].

102    I reject this submission. Superior IP involved an application to set aside a statutory demand issued under the Corporations Act. The demand was for an amount of just over $10,000 and there was a clear issue about the proportionality of the litigation to the amount in dispute. That is quite a different situation from this case. In this case, the applicant is seeking to protect its statutory rights. It should be obvious that the sale of counterfeit goods, even in small quantities, can damage those rights. Equally, as mentioned above, consumers have an interest in the protection of trade marks.

103    I also reject the submission that the apparently small amounts of counterfeit goods expected to be obtained by the ex parte orders is itself indicative of any disproportionality on the part of the applicants in seeking that relief. Contrary to the submissions put on behalf of the Nguyen respondents, in my opinion, the relief sought and obtained was precisely that which ought to be available in an appropriate case (including this case) to give effect to the objects of the Trade Marks Act.

Lack of urgency

104    Somewhat ironically in the light of the previous submission, the Nguyen parties submitted that “any reputable pharmacist could be expected to accede to a request …to take allegedly counterfeit products off the shelves”.

105    The Nguyen parties complained that they were not given advance notice of the ex parte application. Again, how that complaint was relevant to the duty of candour was not explained. The Court was plainly aware that no advance notice was given.

106    The Nguyen parties asserted that “[i]f Geneva’s true purpose in July was to stop Healthline and Healthfirst selling what it thought was counterfeit product, that purpose could have been achieved by a letter of demand”. No evidence was adduced to support the submission that the application had a different or, as it was described “ulterior” purpose. In my view, that submission should not have been put in the absence of an evidentiary basis.

107    I reject the submission that the applicant was obliged to have “clearly articulated” the matters set out above to the Court on 17 July 2014. They were obvious. The Court was aware that the application was for ex parte orders, and that a decision had been made not to send a letter of demand. The Court was aware of the identities of the respondents. The applicants were not required to put anything more by way of evidence or submission to enable the Court to assess the urgency of the application.

108    Further, in case there is any doubt, it was clear that there was no evidence that any of the respondents knew that they were in possession of counterfeit products, or that they were involved in any conspiracy with United Prestige. The applicant did not make any submission to the contrary in support of the application for ex parte orders.

109    It was submitted on behalf of the Oze Pharmacy respondents that the circumstances did not warrant urgent relief of the kind obtained. To the extent that this was said to be a matter about which the Court was insufficiently informed, I do not agree. In my view, the circumstances warranted decisive action. In my view, the results of the orders bear out that view.

Other matters raised by Oze Pharmacy respondents

110    The Oze Pharmacy respondents contended that the applicant should have disclosed:

(1)    The historical dispute between Aspen and United Prestige over competing distribution in Australia of Bio-Oil;

(2)    That United Prestige had made numerous representations to the pharmacy industry that the Bio-Oil they sold was genuine and there was a strong likelihood that reputable pharmacy businesses would not knowingly buy non-genuine products for sale;

(3)    That there were different types of genuine Bio-Oil in the Australian market place;

(4)    That there was no basis for seizure of 60ml Bio-Oil.

111    As to the first matter, in my view, that was not a material matter for disclosure because, in the absence of more facts, it does not affect the strength of the applicant’s case which was based primarily on Mr Cooper’s technical reports and the Customs seizure and subsequent proceedings against United Prestige.

112    As to the second matter, this was not a matter for disclosure because the applicant did not submit that there was evidence of the knowing purchase of counterfeit goods.

113    To the extent that there were different types of genuine Bio-Oil in the market place, there was no evidence that any differences were relevant to the conclusion that counterfeit “Bio-Oil” had been sold by various of the respondents.

114    As to the seizure of 60ml Bio-Oil, Mr Casselden informed the Court that the 60ml trap purchase from an Oze Pharmacy respondent was not found to be counterfeit. He submitted that the results of the analysis were “inconclusive”. It does not follow from that fact that there was no basis for seizure of 60ml Bio Oil or that Mr Casselden ought to have informed the Court that there was no basis. Counsel for the Oze Pharmacy respondents did not criticise the submission that the results of the analysis of the 60ml sample were inconclusive.

115    In those circumstances, in my view, the applicant was not required to inform the Court that there was no basis for seizure of any 60ml products. As to whether there was in fact such a basis, in my view, this question is a matter for resolution at any final hearing in the event that there is a claim on the undertaking as to damages.

Conclusion

116    I am not satisfied that there was any breach of the applicant’s duty of candour or any material non-disclosure. Accordingly, the applications to have the orders discharged should not be set aside on that basis.

Other grounds for setting aside or discharging orders

117    As Brereton J said in Brags, an applicant to set an Anton Piller order aside bears an onus of showing some reason why it should be set aside.

118    Even if there was no material non-disclosure, the Oze Pharmacy respondents argued that the orders should be set aside on the basis that the grounds for the order were not established. As appears from my reasons above, I do not accept that argument with the possible exception of the orders relating to 60ml “Bio-Oil”.

119    However, even if I am wrong about that, I am not satisfied that there would be any utility in discharging the orders after they have been executed. In particular, to the extent that it was submitted on behalf of the Oze Pharmacy respondents that the orders carry with them a “stain of dishonesty” that the respondents should not bear, I do not agree. As appears from my reasons set out above, there has been no finding of dishonesty on the part of the respondents and no allegation of dishonesty against them.

120    Accordingly, I decline to set aside on the orders on the basis that the grounds for the orders were not satisfied.

Summary dismissal

Whether proceedings frivolous or vexatious

121    The Nguyen parties contend that the proceedings are frivolous and vexatious because:

(1)    They would have been unnecessary had a letter of demand been sent first; and

(2)    Any damages to which the applicant may be entitled are derisory.

122    As to the first matter, I do not doubt the veracity of the affidavit evidence that the parties would have responded cooperatively had a letter of demand been sent. Even so, the submissions made by the Nguyen parties on this point cast substantial doubt on the submission that legal proceedings were unnecessary, because it is far from obvious that any damages suffered are derisory. In this regard, I refer to the passage set out at [31] above.

123    The prospect that the Nguyen parties would have cooperated with the delivery up and testing of goods does not render the proceedings either frivolous or vexatious. The applicants are entitled to take reasonable steps to protect their trade marks. This includes bringing proceedings for relief including damages against parties who sell counterfeit products, whether those parties do so knowingly or unknowingly. There is nothing frivolous or vexatious about the proceedings.

Whether proceedings an abuse of process

124    The claim that the proceedings are an abuse of process is made by the Nguyen parties on the following bases:

(1)    The proceedings are brought for a collateral purpose, being to attack the customers of United Prestige, as part of a broader war between the applicant and United Prestige;

(2)    The applicant failed to take “genuine steps” to avoid the commencement of proceedings.

125    The Oze Pharmacy respondents also point to:

(1)    The applicant’s breach of its implied undertaking not to use documents obtained in the United Prestige proceeding other than for the purpose of those proceedings;

(2)    The applicant’s non-compliance with court orders for the filing and service of an experts report and a fast track statement.

126    No evidence was adduced of any collateral purpose on the part of the applicant, beyond press reports about a dispute between Aspen and United Prestige. The argument was that an ulterior purpose could be inferred from the failure to send a letter of demand and the applicant’s knowledge of the small quantities of the disputed products involved in the proceedings.

127    The evidence does not justify a conclusion that the proceedings have been brought for an ulterior or collateral purpose. On the available evidence, I have no reason to doubt that the proceedings are properly brought in order to remove counterfeit product from the market and to protect the applicant’s trade marks including by claiming damages from the Nguyen parties.

128    The failure to comply with “genuine steps” requirements is not indicative of any abuse of process. The underlying issue is that the applicant chose to commence proceedings without approaching the respondents first. In my view, in all of the circumstances, particularly the various trap purchases of counterfeit goods, this was a legitimate approach for the applicant to take.

Whether there are no reasonable prospects of successfully prosecuting the proceedings against the Oze Pharmacy respondents

129    In the Oze Pharmacy proceedings, final relief is sought against the first, second and third respondents. Accordingly, this issue does not arise in relation to the sixth to eighth respondents.

130    Affidavits have been served on behalf of the first and second respondents deposing to the fact that:

(1)    The first respondent has neither purchased nor sold Bio Oil in the two years preceding 17 July 2014; and

(2)    The second respondent had no financial interest in the pharmacies at which the trap purchases were made having divested his interests in the Oze Pharmacy group prior to the commencement of the proceeding.

131    However, that evidence is inconsistent with the evidence that the Oze Pharmacy business at Hornsby, where trap purchases were made, is owned by the second respondent jointly with the third respondent. It is also inconsistent with the evidence that the Oze Pharmacy business at Castle Hill, where trap purchases were made, is operated by the first respondent.

132    As there is a dispute on the evidence as to whether the applicant is entitled to relief against the first, second and third respondents, it is not appropriate to dismiss the proceedings against them summarily.

Whether reasonable cause of action disclosed.

133    The ex parte orders were made on the basis of a finding that the applicant had demonstrated a strong prima facie case. The Oze Pharmacy respondents’ submissions do not satisfy me that there is no such case. It necessarily follows that I am satisfied that a reasonable cause of action has been disclosed by the applicant.

Indemnity costs

134    The various parties’ claims for indemnity costs depended upon the Court accepting the arguments rejected above.

135    Accordingly, it is unnecessary to consider those claims further.

Conclusion

136    Each of the applications should be dismissed with costs.

Associate:

Dated:    25 November 2014

Annexure

GENEVA LABORATORIES LIMITED

Applicant

STEVEN NGUYEN TRADING AS HEALTH LINE PHARMACY - SYDNEY and others named in the schedule

Respondent

ORDER

Bio-Oil Marks means each or any of the following registered trade marks:

(a)    registered trade mark No. 550808, which is a mark of the word “Bio-Oil” and an image of horizontal stripes which form a drop;

(b)    registered trade mark No. 1540111, which is a mark of the word “Bio-Oil” Mark;

(c)    the registered trade mark No. 1503757 of the word “Bio-Oil” and an image of horizontal stripes which form a drop; and

(d)    registered trade mark No. 1222258 which is a mark of the words “PurCellin Oil”.

Correspondence means all communications, including but not limited to emails, letters, text messages and facsimile transmissions, between any of the Respondents and any entity and/or person, including but not limited to:

(a)    Prestige Premium Deals Pty Ltd trading as United Prestige (ACN 145 497 427);

(b)    United Prestige Clearance Pty Ltd (ACN 147 508 709);

(c)    United Prestige Group Pty Ltd (ACN 163 773 162);

(d)    United Prestige Pty Ltd; and/or

(e)    Andrew Christopher,

in relation to the purchase and/or sale of the Goods.

Geneva Bio-Oil Proceedings means Federal Court of Australia Proceeding No. NSD 344 of 2014.

Goods means any product which applies the Bio-Oil Marks and/or substantially identical or deceptively similar marks to the Bio-Oil Marks including but not limited to 60ml, 125ml and 200ml bottles of Bio-Oil.

Marque Lawyers means Marque Lawyers, Level 4, 343 George Street, Sydney NSW 2000.

Purchase Documents means all documents in relation to the purchase and/or sale of the Goods including but not limited to purchase orders, receipts, invoices, letters of credit, direct debit receipts, delivery dockets and agreements.

THE COURT ORDERS THAT:

1.    The time for service of the Fast Track Application and evidence in support be abridged to 12 pm on 21 July 2014.

2.    Service of the documents referred to in order 1 be effected on:

(a)    the First and Second Respondents by personal service at their business address located at Shop 1, 261 George Street, Sydney NSW 2000;

(b)    the Third and Fourth Respondents by personal service at the registered office of the Third Respondent located at 510 Burwood Road, Belmore NSW 2192;

(c)    the Fifth Respondent by personal service at his business address located at Shop 1, 821-825 Pennant Hills Road, Carlingford NSW 2118;

(d)    the Sixth Respondent by personal service at his business address located at 157-159 Beamish Street, Campsie NSW 2194; and

(e)     the Seventh Respondent by personal at his business address located at 134-146 Enmore Road, Newtown NSW 2042.

3.    The Applicant be released from its implied undertaking not to use pages 59, 72, 91, 101, 103, 108, 116, 166, 174, 193, 209, 211, 229 and 231 of the affidavit of Andrew Christopher sworn on 2 July 2014 for a purpose other than the Geneva Bio-Oil Proceedings.

4.    The Respondents deliver up all 60ml and 200ml bottles of the Goods in their possession, control or custody to the Court by 9.30 am on 23 July 2014.

5.    In the alternative to Order 4, the Respondents deliver up all 60ml and 200ml bottles of the Goods in their possession, control or custody to Marque Lawyers for safekeeping by 5 pm on 22 July 2014.

6.    Within 7 days of this order, each of the Respondents file and serve an affidavit disclosing each and every purchase of the Goods which occurred in the period 2 years prior to the date of this order and for each such purchase, include the following information:

(a)    the name and address of the entity/person from which each of the Respondents purchased the Goods;

(b)    copies of Correspondence, annexed to the affidavit or otherwise produced, relating to the purchase of the Goods;

(c)    copies of Purchase Documents, annexed to the affidavit or otherwise produced, relating to the purchase of the Goods; and

(d)    a description of the Goods including but not limited to the quantity purchased and the volume in millilitres of the Goods purchased.

7.    Within 7 days of this order, each of the Respondents file and serve an affidavit disclosing each and every sale of the Goods which occurred in the period 2 years prior to the date of this order and for each such sale, include the following information:

(a)    the name and address of the entity/person to which each of Respondents sold the Goods;

(b)    copies of Correspondence, annexed to the affidavit or otherwise produced, relating to the sale of the Goods;

(c)    copies of Purchase Documents, annexed to the affidavit or otherwise produced, relating to the sale of the Goods; and

(d)    a description of the Goods including but not limited to the quantity sold and the volume in millilitres of the Goods sold.

8.    Upon the Applicant giving the usual undertaking as to damages, on and from 12 pm on 21 July 2014, the Respondents be restrained, whether by themselves, their servants, agents or howsoever otherwise from selling, offering for sale, supplying, displaying and/or advertising the Goods (excluding 125ml bottles of Bio-Oil) until 5 pm on 23 July 2014 or further order of the Court.

9.    The Respondents be restrained, whether by themselves, their servants, agents or howsoever otherwise from disclosing to any other person (other than a legal representative for the purposes of obtaining legal advice):

(a)    the Fast Track Application;

(b)    the affidavits made in support of the Fast Track Application;

(c)    these orders,

until further order of the Court.

10.    The parties be at liberty to apply on 24 hours’ notice.

Date that entry is stamped:

    Deputy District Registrar Schedule

    No: (P)NSD710/2014

Federal Court of Australia

District Registry: New South Wales

Division: General

Second Respondent:    TANIA HOANG TRADING AS HEALTH LINE PHARMACY-SYDNEY

Third Respondent:    INSPIRED HEALTH (AUST) PTY LTD ACN 161 693 625

Fourth Respondent:    JOHN NGUYEN

Fifth Respondent:    VINOD NEGI TRADING AS CINCOTTA DISCOUNT CHEMIST CARLINGFORD

Sixth Respondent:    JOSEPH CINCOTTA

Seventh Respondent:    SAMER MEGALLI TRADING AS SHOPSMART WHOLESALE PHARMACY - NEWTOWN

GENEVA LABORATORIES LIMITED

Applicant

OZE-PHARMACY PTY LTD ACN 092 541 510 and others named in the schedule

Respondent

ORDER

In this order the following defined terms are used:

Anton Piller Order means the document annexed to the Fast Track Application and marked “A”.

Bio-Oil Marks means each or any of the following registered trade marks:

(a)    registered trade mark No. 550808, which is a mark of the word “Bio-Oil” and an image of horizontal stripes which form a drop;

(b)    registered trade mark No. 1540111, which is a mark of the word “Bio-Oil” Mark;

(c)    the registered trade mark No. 1503757 of the word “Bio-Oil” and an image of horizontal stripes which form a drop; and

(d)    registered trade mark No. 1222258 which is a mark of the words “PurCellin Oil”.

Correspondence means all communications, including but not limited to emails, letters, text messages and facsimile transmissions, between any of the Respondents and any entity and/or person, including but not limited to:

(a)    Prestige Premium Deals Pty Ltd trading as United Prestige (ACN 145 497 427);

(b)    United Prestige Clearance Pty Ltd (ACN 147 508 709);

(c)    United Prestige Group Pty Ltd (ACN 163 773 162);

(d)    United Prestige Pty Ltd; and/or

(e)    Andrew Christopher;

(f)    Primo Deals Limited;

(g)    Chunpeng Su;

(h)    Katy Perry;

(i)    J & T World Trade Pty Ltd; and/or

(j)    Rahal Rahal,

in relation to the purchase, importation and/or sale of the Goods.

Geneva Bio-Oil Proceedings means Federal Court of Australia Proceeding No. NSD 344 of 2014.

Goods means any product which applies the Bio-Oil Marks and/or substantially identical or deceptively similar marks to the Bio-Oil Marks including but not limited to 60ml, 125ml and 200ml bottles of Bio-Oil.

Importation Documents means all documents relating to the importation of the Goods into Australia including but not limited to agreements with brokers or consignees, duty assessments or valuations, invoices, receipts, bills of lading, airway bills, seaway bills, delivery documents and/or electronic or hard copies of importation or customs documents.

Marque Lawyers means Marque Lawyers, Level 4, 343 George Street, Sydney NSW 2000.

Purchase Documents means all documents in relation to the purchase and/or sale of the Goods including but not limited to purchase orders, receipts, invoices, letters of credit, direct debit receipts, delivery dockets and agreements.

THE COURT ORDERS THAT:

1.    The time for service of the Fast Track Application and evidence in support be abridged to 12 pm on 18 July 2014.

2.    Service of the documents referred to in order 1 be effected on:

(a)    the First to Third Respondents by personal service to the First Respondent’s principal place of business at Unit 10, Level 1, Hills Homemaker Centre, 18 Victoria Avenue, Castle Hill NSW 2154 (Shop 9, Home Hub Castle Hill, at Cnr Showground Rd & Victoria Avenue, Castle Hill NSW 2154).

(b)    the Fourth and Fifth Respondent by personal service to the Fourth Respondent’s registered office located at 72C Broadway, Glenelg SA 5045.

(c)    the Sixth Respondent by personal service to its principal place of business located at Unit 19, 22 Hudson Avenue, Castle Hill NSW 2154.

(d)    the Seventh Respondent by personal service to its registered office located at Level, 16, 168 Walker Street, North Sydney NSW 2060.

(e)    the Eighth Respondent by personal service to its principal place of business located at Unit 5, 22 Hudson Avenue, Castle Hill NSW 2154.

(f)    the Ninth Respondent by personal service to its registered office located at 72C Broadway, Glenelg SA 5045.

3.    The Applicant be released from its implied undertaking not to use the document produced by the Australian Customs and Border Protection Service pursuant to the Notice to Produce dated 30 May 2014 issued by the Applicant for a purpose other than the Geneva Bio-Oil Proceedings.

4.    Upon the Applicant giving the usual undertakings as to damages as set out in Schedule B of the Anton Piller Order, the Applicant be granted the Anton Piller Order.

5.    The Fourth to Ninth Respondents deliver up all 60ml and 200ml bottles of the Goods in their possession, control or custody to the Court by 9.30 am on 23 July 2014.

6.    In the alternative to Order 5, that the Fourth to Ninth Respondents deliver up all 60ml and 200ml bottles of the Goods in their possession, control or custody to Marque Lawyers for safekeeping by 5 pm on 22 July 2014.

7.    Within 7 days of this order, each of the Respondents file and serve an affidavit disclosing each and every purchase of the Goods which occurred in the period 2 years prior to the date of this order and for each such purchase, include the following information:

(a)    the name and address of the entity/person from which each of the Respondents purchased the Goods;

(b)    copies of Correspondence, annexed to the affidavit or otherwise produced, relating to the purchase of the Goods;

(c)    copies of Purchase Documents, annexed to the affidavit or otherwise produced, relating to the purchase of the Goods;

(d)    copies of Importation Documents, annexed to the affidavit or otherwise produced, relating to the importation of the Goods; and

(e)    a description of the Goods including but not limited to the quantity purchased and the volume in millilitres of the Goods purchased.

8.    Within 7 days of this order, each of the Respondents file and serve an affidavit disclosing each and every sale of the Goods which occurred in the period 2 years prior to the date of this order and for each such sale, include the following information:

(a)    the name and address of the entity/person to which each of Respondents sold the Goods;

(b)    copies of Correspondence, annexed to the affidavit or otherwise produced, relating to the sale of the Goods;

(c)    copies of Purchase Documents, annexed to the affidavit or otherwise produced, relating to the sale of the Goods; and

(d)    a description of the Goods including but not limited to the quantity sold and the volume in millilitres of the Goods sold.

9.    Upon the Applicant giving the usual undertaking as to damages, the Respondents be restrained, whether by themselves, their servants, agents or howsoever otherwise from selling, offering for sale, supplying, displaying and/or advertising the Goods (excluding 125ml bottles of Bio-Oil) until 23 July 2014 or further order of the Court.

10.    The Respondents be restrained, whether by themselves, their servants, agents or howsoever otherwise from disclosing to any other person (other than a legal representative for the purposes of obtaining legal advice):

(a)    the existence of the Anton Piller Order;

(b)    the Fast Track Application;

(c)    the affidavits made in support of the Fast Track Application;

(d)    these orders,

until further order of the Court.

11.    The parties be at liberty to apply on 24 hours’ notice.

Date that entry is stamped:

Deputy District Registrar Schedule

    No: (P)NSD711/2014

Federal Court of Australia

District Registry: New South Wales

Division: General

Second Respondent:    RAYMOND SHAHIDI

Third Respondent:    WARREN TURNER

Fourth Respondent:    CASTLE HILL PHARMACY PTY LTD ACN 166 252 839

Fifth Respondent:    ZELIMIR ANTHONY SEMAN

Sixth Respondent:    OZE-PHARMACY GROUP PTY LTD ACN 129 906 912

Seventh Respondent:    OZE-PHARMACY NORTHERN BEACHES PTY LTD ACN 111 485 502

Eighth Respondent:    OZE-PHARMACY TUGGERAH SERVICES PTY LTD ACN 154 500 508

Ninth Respondent:    HIGH STREET PENRITH PHARMACY PTY LTD ACN 166 252 900