FEDERAL COURT OF AUSTRALIA

Playgro Pty Ltd v Playgo Art & Craft Manufactory Limited (No 2) [2016] FCA 478

ORDERS

THE COURT DECLARES THAT:

1.    The respondents have infringed Australian trade mark registration numbers 740357, 954929 and 970023 (the Playgro Trade Marks) by supplying for sale in Australia:

(a)    playthings under or by reference to the Playgo Device Mark (as defined in paragraph [2] of the reasons for judgment dated 22 March 2016) (the Playgo Device Mark); and

(b)    playthings in packaging bearing both (i) the Playgo Device Mark and (ii) the word, ‘PLAYGO’ in the small print on the packaging (other than as part of a company name).

THE COURT ORDERS THAT:

2.    The respondents, whether by themselves their officers, employees, agents or howsoever otherwise, be restrained from infringing the Playgro Trade Marks, in particular by, without the licence or authority of the applicant:

(a)    supplying for sale in Australia playthings under or by reference to the Playgo Device Mark; or

(b)    supplying for sale in Australia playthings in packaging bearing both (i) the Playgo Device Mark and (ii) the word, ‘PLAYGO’ in the small print on the packaging (other than as part of a company name).

3.    In relation to costs:

(a)    the respondents pay the applicant’s costs of the proceeding up to and including 22 March 2016, including all reserved costs;

(b)    there be no order as to costs in relation to the written submissions on orders filed on 5 and 8 April 2016 and the hearing on 12 April 2016;

(c)    the applicant pay the respondents’ costs in relation to the further written submissions relating to the word ‘PLAYGO’ filed pursuant to the email from the Court dated 13 April 2016;

(d)    any costs incurred by the parties since 22 March 2016 which are not covered by (b) or (c) be reserved.

4.    Any application for leave to appeal from the reasons for judgment dated 22 March 2016 and 9 May 2016 and these orders be filed and served within 21 days.

5.    The matter be listed for further directions on a date to be fixed, with regard to the determination of the nature or quantum of any pecuniary relief.

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

REASONS FOR JUDGMENT

MOSHINSKY J:

1    On 22 March 2016, I delivered reasons for judgment in this matter: Playgro Pty Ltd v Playgo Art & Craft Manufactory Limited [2016] FCA 280 (the Reasons). These reasons should be read together with the Reasons dated 22 March 2016. Words or expressions defined in the Reasons have the same meaning in these reasons. The parties have been unable to agree on the form of orders to give effect to the Reasons. The main issues in dispute can be summarised as follows:

(a)    whether the declaration and any injunction should extend to the word, ‘PLAYGO’ in addition to the Playgo Device Mark;

(b)    whether an injunction should be ordered and the terms of any injunction;

(c)    whether there should be an order requiring the respondents to recall playthings bearing the Playgo Device Mark or the word, ‘PLAYGO’;

(d)    whether there should be an order requiring delivery up by the respondents; and

(e)    costs.

2    There are also some miscellaneous matters to be addressed. I address each of these matters in turn.

Whether the declaration and any injunction should extend to the word, ‘PLAYGO’ in addition to the Playgo Device Mark

3    During the hearing of this matter on 8 and 9 December 2015, the applicant focussed its infringement case on the use of the Playgo Device Mark. Although the applicant’s pleadings referred both to the Playgo Device Mark and to the word mark ‘PLAYGO’ (as set out in paragraphs [14], [15] and [17]-[19] of the Reasons), in its written submissions at trial the applicant referred only to the Playgo Device Mark. In its oral submissions, the applicant made one brief reference to the use of the word, ‘PLAYGO’ but otherwise referred to the Playgo Device Mark. The applicant did not take issue with a footnote in the respondents’ written submissions dated 1 December 2015 to the effect that the applicant had confined its argument on infringement to the Playgo Device Mark.

4    In line with the way in which the applicant’s case had been presented, the Reasons articulated the issues to be determined, and expressed conclusions on those issues, by reference to the Playgo Device Mark: see the Reasons at [7], [8], [95], [97], [120]. Brief reference was made to the word mark ‘PLAYGO’ in paragraphs [112] and [119] of the Reasons, but it was considered unnecessary to reach conclusions on the use of the word mark.

5    It should also be noted that the evidence tendered at trial included playthings bearing both (i) the Playgo Device Mark and (ii) the word, ‘PLAYGO’ in the small print on the packaging: see the Reasons, paragraphs [59], [61] and [75].

6    Following publication of the Reasons, the applicant contended in written submissions that the declaration of infringement and other orders should extend to the word, ‘PLAYGO’ in addition to the Playgo Device Mark. The applicant contended that the Court, at paragraphs [114]-[116] and [119] of the Reasons, had found deceptive similarity by reference to the similarity of the respective words ‘PLAYGRO’ and ‘PLAYGO’ despite the presence of the red triangular background of the Playgo Device Mark. It was contended by the applicant that, if the respective trade marks are deceptively similar despite the presence of the red triangular background, then a fortiori the marks are also deceptively similar when the red triangular background is absent and only the words are compared. The respondents resisted this on the basis that the trial of the proceeding was conducted on the basis that the relevant question for determination on the issue of trade mark infringement was whether the respondents’ use of the Playgo Device Mark infringed the applicant’s trade marks, and the Reasons did not include any findings as to the word mark ‘PLAYGO’ (whether as to deceptive similarity or use as a trade mark).

7    Following a hearing on 12 April 2016, the Court indicated by email to the parties’ legal representatives that it considered that the applicant was effectively seeking leave to re-open to make submissions on the question of whether the presence of the word mark ‘PLAYGO’ in the small-print packaging statements extracted in the Reasons amounts to infringement under s 120 of the Act. The email stated that the Court would permit the applicant to re-open to make submissions on this question as it arises from the pleadings and therefore would not have affected the evidence. Each side was given the opportunity to file a further written submission on the question. Further written submissions were subsequently filed by the parties.

8    As set out in paragraphs [59], [61] and [75] of the Reasons, the evidence included playthings with statements in the small print on their packaging using the word ‘PLAYGO’. For example, as set out in paragraph [59] of the Reasons, the ‘My Tea Party’ toy included the following statement in the small print on its packaging:

PLAYGOTM is a trademark of

PLAYGO ART & CRAFT MANUFACTORY LIMITED

Copyright ©

Manufactured by PLAYGO TOYS ENTERPRISES LIMITED

…

The above statement appears on the underside of the packaging. The font is very small. It appears to be approximately 6 point on the ‘My Tea Party’ toy and the ‘My Toaster’ toy and about 8 point on the ‘My Wiggly Caterpillar’ toy. In contrast, the Playgo Device Mark is much larger and appears on the front and sides of the packaging.

9    It should be noted that the applicant eschews any contention that the use of ‘PLAYGO’ in the company names in the above extract (and in the other like statements extracted in the Reasons) constitutes an infringement. Thus the focus is on the use of the word, ‘PLAYGO’ in the first line of the above extract (and in the first line of the other packaging statements extracted in the Reasons). It is to be noted that, in the first line of the above extract, and in the first line of the statements extracted in paragraphs [61] and [75] of the Reasons, the word, ‘PLAYGO’ is immediately followed by the letters, ‘TM’ in superscript (the letters being a well-known abbreviation for the words ‘trade mark’) and the words “is a trademark of”.

10    Two issues arise. First, whether the use of the word, ‘PLAYGO’ in this way, constitutes use ‘as a trade mark’. Secondly, whether the ‘PLAYGO’ word mark is deceptively similar to the applicant’s trade marks.

11    In relation to the first issue, the respondents submit that the word, ‘PLAYGO’ is not being used as a trade mark, but merely as a key or legend to refer to the Playgo Device Mark. They submit that, in assessing the use of the mark, the Court needs to take into account the totality of the packaging of the respondents’ goods, including the way in which the word is displayed in relation to the goods and the existence elsewhere on the packaging of a label of a clear and dominant brand, citing Nature’s Blend Pty Ltd v Nestlé Australia Ltd (2010) 87 IPR 464 at [19] per Stone, Gordon and McKerracher JJ. The respondents submit that the Court ought to have regard to the positioning of the word, the font used, the size of the word or its letters, and the colours which are used, citing The Shell Company of Australia Ltd v Esso Standard Oil (Australia) Ltd (1963) 109 CLR 407 at 422 per Kitto J; Mantra Group Pty Ltd v Tally Pty Ltd (No 2) (2010) 183 FCR 450 at [50] per Reeves J.

12    The respondents contend that an examination of the packaging of the respondents’ products reveals that:

(a)    the word, ‘PLAYGO’ appears in the fine print on the underside of the box;

(b)    the word is in small, plain, black type;

(c)    the word would only be noticed by persons who picked up the respondents’ products and read the fine print on the underside of the box;

(d)    on the other hand, the Playgo Device Mark appears a total of five times on the packaging of the products – on each face save for the underside. In each case, it appears prominently at the top left of each face;

(e)    the ‘TM’ symbol appears next to the Playgo Device Mark in each case;

(f)    the name of the product (eg, ‘My Tea Party’) appears prominently on the front of the box.

13    The respondents submit that the relevant enquiry requires the Court to consider what a consumer considering the features of the respondents’ packaging would see and take from them, citing Nature’s Blend Pty Ltd v Nestlé Australia Ltd (2010) 87 IPR 464 at [19] per Stone, Gordon and McKerracher JJ; Anheuser-Busch Inc v Budejovický Budvar, Národní Podnik (2002) 56 IPR 182 at [186] per Allsop J. In the current circumstances, the respondents submit, before even reading the word, ‘PLAYGO’, consumers would first have to view the respondents’ product on a shelf, pick it up to inspect it and proceed to examine the underside of the packaging. Such consumers, the respondents submit, would immediately notice and consider the Playgo Device Mark prior to picking up the product. Closer inspection of each side of the packaging would emphasise the role of the Playgo Device Mark as the ‘badge of origin’. The respondents submit that it is very unlikely that a consumer who then persevered to the extent of reading the fine print on the underside of the box would understand the word, ‘PLAYGO’ to act independently and separately as a ‘badge of origin’ of the respondents’ goods. By the time the consumer examined the underside of the packaging, he or she would be in little doubt that the Playgo Device Mark signified the commercial origin of the product. The consumer would not expect to find the badge of origin for the goods in the fine print on the underside of the packaging; rather, a consumer reading the fine print would expect to find notices regarding safety information, age recommendations and legal disclaimers.

14    The respondents submit that the statement would be read by consumers as such a legal notice or disclaimer; they would understand the word, ‘PLAYGO’ in the packaging statement to be referring to the Playgo Device Mark, and as being intended to put consumers and other traders on notice of the respondents’ rights therein (the respondents having registered the Playgo Device Mark as a trade mark in China and Hong Kong). The respondents submit that this is not a separate or independent use of the word ‘as a trade mark’, but rather use of the word as a key, short-hand or legend to refer to the Playgo Device Mark, with the latter distinguishing the products as originating from the respondents.

15    In my view, the respondents did use the word, ‘PLAYGO’ in the first line of the packaging statements extracted in paragraphs [59], [61] and [75] of the Reasons ‘as a trade mark’. The key question is whether the word, ‘PLAYGO’ would have appeared to consumers as possessing the character of a brand, that is to say, was the word used so as to indicate a connection in the course of trade between the respondents and the products: The Shell Company of Australia Ltd v Esso Standard Oil (Australia) Ltd (1963) 109 CLR 407 at 422 per Kitto J; Johnson v Johnson Australia Pty Ltd v Sterling Pharmaceuticals Pty Ltd (1991) 30 FCR 326 at 347 per Gummow J; Nature’s Blend Pty Ltd v Nestle Australia Ltd (2010) 86 IPR 1 at [23] per Sundberg J; Nature’s Blend Pty Ltd v Nestlé Australia Ltd (2010) 87 IPR 464 at [19] per Stone, Gordon and McKerracher  JJ. In Anheuser-Busch Inc v Budejovický Budvar, Národní Podnik (2002) 56 IPR 182, Allsop J (as his Honour then was) said at [184]-[186]:

184    The notion of trade mark use is now given content by ss 7 and 17 of the [Trade Marks Act 1995 (Cth)]. …

185    The task is to examine the way the words are used in their context, including the totality of the packaging, to assess their nature and purpose in order to see whether they are used to distinguish the goods from goods of others: The Shell Co [(1961) 109 CLR 407] at 422-25; Mark Foys Ltd [(1956) 95 CLR 190] at 198-200; Johnson & Johnson Aust Pty Ltd v Sterling Pharmaceuticals Pty Ltd (1991) 30 FCR 326, 335, 342-45, 347-49; Pepsico Australia [(1996) 33 IPR 161] at 162-63, 167-69 and 178-82; Musidor BV v Tansing (t/as Apple Music House) (1994) 52 FCR 363, 376-77; Koninklijke Philips Electronics NV v Remington Products Australia Pty Ltd (2000) 48 IPR 257, 265-66; and Aldi Stores [[2001] FCA 1874] at [22] to [30] and [54] to [58].

186    The assessment is made from the perspective of what a person looking at the label would see and take from it, as to the purpose and nature of its use: The Shell Co, supra at 425; Wrigley’s (Australasia) Ltd v Life Savers (Australasia) Ltd (1936) 37 SR (NSW) 9, 16; Aldi Stores [[2001] FCA 1874] at [22] to [24] and [76].

16    In that case, his Honour held that there was trade mark use and in relation to other marks on the packaging said (at [189] and [191]):

189    The usage of a word may fulfil more than one purpose on a label. For example a word may have a descriptive element, but also an element of trade mark or branding or distinguishing role: Johnson & Johnson v Sterling Pharmaceuticals [(1991) 30 FCR 326] at 335. Equally, a word may have a role in identifying a geographical location, but also a trade mark or branding or distinguishing role. It depends on context.

…

191    It is not to the point, with respect, to say that because another part of the label (the white section with ‘Budějovický Budvar’) is the obvious and important ‘brand’, that another part of the label cannot act to distinguish the goods. The ‘branding function’, if that expression is merely used as a synonym for the contents of ss 7 and 17 of the [Trade Marks Act 1995 (Cth)], can be carried out in different places on packaging, with different degrees of strength and subtlety. Of course, the existence on a label of a clear dominant ‘brand’ is of relevance to the assessment of what would be taken to be the effect of the balance of the label.

17    In the present case, the word, ‘PLAYGO’ was immediately followed by the letters, ‘TM’ in superscript and the words “is a trademark of”. These are strong indicators that the word, ‘PLAYGO’ is being used as a trade mark, that is, as a ‘badge of origin’ to distinguish the respondents’ playthings from playthings made by others. While the nature and purpose of the use of the word must be considered in the context of the packaging as a whole, which includes the Playgo Device Mark on the front and sides of the box, the fact that the Playgo Device Mark is used as a trade mark does not diminish the fact, in this case, that the word, ‘PLAYGO’ in the small print is also being used as a trade mark. This case may be contrasted with cases where a word which is arguably descriptive is used in small print on the packaging and it is concluded that, in the context of the packaging as a whole, including the use of a prominent brand elsewhere on the packet, the word is not being used as a trade mark: compare, for example, Nature’s Blend Pty Ltd v Nestle Australia Ltd (2010) 86 IPR 1 at [22], [37]-[40] per Sundberg J; Nature’s Blend Pty Ltd v Nestlé Australia Ltd (2010) 87 IPR 464 at [42], [48] per Stone, Gordon and McKerracher JJ. In the present case, the word, ‘PLAYGO’ is not descriptive and the presence of the superscript letters, ‘TM’ and the words “is a trademark of” indicate use as a trade mark.

18    While it may be possible to interpret the use of the word, ‘PLAYGO’ as a key or legend to refer to the Playgo Device Mark, and signify that it is a trade mark of the named company, it is sufficient if one of the impressions that the viewer of the label will take away is that the word is being used as a trade mark: see, for example, the observations of Allsop J in Anheuser-Busch Inc v Budejovický Budvar, Národní Podnik (2002) 56 IPR 182 at [189], [191]-[192]. In my view, for the reasons set out above, this is one of the impressions that a reader of the label would take away.

19    The second issue is deceptive similarity. The respondents submit that the word, ‘PLAYGO’ is not deceptively similar to the applicant’s registered trade marks for the same reasons, mutatis mutandis, as submitted at trial in relation to the Playgo Device Mark (summarised in the Reasons at [113]). It follows from my conclusion that the Playgo Device Mark is deceptively similar to the applicant’s trade marks (see the Reasons at [114]-[118]), that the word, ‘PLAYGO’ is deceptively similar to the applicant’s trade marks. As the applicant submits, that the word, ‘PLAYGO’ is deceptively similar follows a fortiori from the conclusion in relation to the Playgo Device Mark.

20    For these reasons, the declaration of infringement should extend to the use of the word, ‘PLAYGO’ in the small print on the packaging of the relevant playthings.

21    As the only examples of use of the word, ‘PLAYGO’ were on packaging also bearing the Playgo Device Mark, it is appropriate that the declaration and any injunction be framed in terms which reflect this; otherwise the declaration and any injunction might pick up use of the word, ‘PLAYGO’ in the small print on packaging in other contexts which have not been considered by the Court and which are beyond the scope of this proceeding. Further, the applicant accepted that there should be a ‘carve out’ for the use of the word, ‘PLAYGO’ in a company name. Accordingly, I will make a declaration in the following terms:

The respondents have infringed Australian trade mark registration numbers 740357, 954929 and 970023 (the Playgro Trade Marks) by supplying for sale in Australia:

(a)    playthings under or by reference to the Playgo Device Mark (as defined in paragraph [2] of the reasons for judgment dated 22 March 2016) (the Playgo Device Mark); and

(b)    playthings in packaging bearing both (i) the Playgo Device Mark and (ii) the word, ‘PLAYGO’ in the small print on the packaging (other than as part of a company name).

Whether an injunction should be ordered and the terms of any injunction

22    The respondents submit that an injunction is unnecessary because, since November 2014, they have not sold any products bearing the Playgo Device Mark to buyers or retailers who import the respondents’ products into Australia (see the Reasons, [87]-[88]). In the alternative, the respondents submit that, if the Court is nevertheless minded to grant injunctive relief, such relief should be limited to conduct in Australia. The respondents also submit that the words “under or by reference to” proposed by the applicant be replaced with “using as a trade mark”.

23    In my view, it is appropriate given the finding of infringement that an injunction be ordered. This is usual in cases such as this. In relation to the wording of the injunction, I do not think the injunction should be expressed in terms of conduct in Australia. As discussed in the Reasons, the case concerned the respondents supplying for sale in Australia products bearing a trade mark which was deceptively similar to the applicant’s trade marks (see the Reasons at [122]). The terms of the injunction should reflect this. The words, “under or by reference to” are in my view preferable to the words, “using as a trade mark” as the latter words, picking up the language of the Act itself, are more likely to invite debate about what is, or is not, covered. However, the words “under or by reference to” are inappropriate for the part of the injunction dealing with the use of the word, ‘PLAYGO’ in the small print on the packaging, which should be expressed in terms of packaging bearing the word in the small print. For the reasons given in paragraph [21] above, that part of the injunction should be expressed in terms of packaging bearing both the Playgo Device Mark and the word, ‘PLAYGO’ in the small print. Accordingly, I will make an order in the following terms:

The respondents, whether by themselves their officers, employees, agents or howsoever otherwise, be restrained from infringing the Playgro Trade Marks, in particular by, without the licence or authority of the applicant:

(a)    supplying for sale in Australia playthings under or by reference to the Playgo Device Mark; or

(b)    supplying for sale in Australia playthings in packaging bearing both (i) the Playgo Device Mark and (ii) the word, ‘PLAYGO’ in the small print on the packaging (other than as part of a company name).

Whether there should be an order requiring the respondents to recall playthings bearing the Playgo Device Mark or the word, ‘PLAYGO’

24    The third issue is whether there should be an order requiring the respondents to recall playthings bearing the Playgo Device Mark or the word, ‘PLAYGO’. The applicant seeks an order that, within 28 days, the respondents take all practical steps to recall any playthings bearing the Playgo Device Mark or the name, ‘PLAYGO’ from any wholesale or retail customers in Australia to whom the respondents have directly or indirectly supplied such products, including the operators of Woolworths, Big W and Myer stores throughout Australia.

25    In my view, such an order should not be made. In relation to products bearing the Playgo Device Mark, the respondents stopped selling products bearing this mark to Australian buyers and retailers in November 2014 (see the Reasons, [87]-[88]). It is unlikely that many such products are still held by those buyers or retailers given the passage of time. Accordingly, there does not seem to be practical utility in an order requiring the respondents to take all practical steps to recall products. Further, there is no evidence to suggest that the respondents have a right to require such buyers or retailers to return the products. It may be difficult to determine what is required of the respondents in circumstances where there is no right to recall the products. In relation to the word, ‘PLAYGO’, consistently with the reasons given in paragraph [21] above, any relief should be limited to the use of the word in conjunction with the Playgo Device Mark. It follows that there should not be a recall order relating to products which may bear the word, ‘PLAYGO’ but not the Playgo Device Mark.

Whether there should be an order requiring delivery up by the respondents

26    The fourth issue is whether there should be an order requiring delivery up by the respondents. The applicant seeks an order that, within 28 days, the respondents deliver up to the applicant at an address nominated by the applicant any playthings bearing the Playgo Device Mark or the name, ‘PLAYGO’, and any packaging, promotional or advertising material in respect of such products, which are in the possession or control of the respondents and which:

(a)    bear any marking that identifies the product as being destined for Australia; or

(b)    are otherwise intended to be sold or exposed to customers in Australia.

27    In Streetworx Pty Ltd v Artcraft Urban Group Pty Ltd (No 2) (2015) 110 IPR 544, a patent infringement case, Beach J said at [110]:

The question of whether delivery up orders are made is in my discretion. Moreover, it is relief that is ancillary to the injunction granted. In considering whether delivery up orders should be made, a question is whether the infringer “may be subject to too serious and grave a temptation and may thereby be tempted to commit a breach of the injunction” (Mergenthaler Linotype Co v Intertype Ltd (1926) 43 RPC 381 … at 382 per Russell J). In such a case, delivery up orders may be made. But not to punish the infringer and not in such a form as to go beyond what is necessary to protect the patentee. After all, the property in the infringing articles, notwithstanding the patentee’s privilege, is in the infringer (Vavasseur v Krupp (1878) 9 Ch D 351 at 360 per Cotton LJ). …

28    In my view, a delivery up order should not be made in the present case. The respondents are based in Hong Kong and manufacture their products in China. They sell their products to buyers in many countries around the world. If they have any products bearing the Playgo Device Mark which (a) bear any markings that indicate that the products are destined for Australia or (b) are otherwise intended to be sold or exposed to customers in Australia, those products are likely to be located in China and capable of being sold (potentially in new packaging) to buyers or retailers for sale in other countries. In circumstances where any such products are capable of being sold in a way which does not constitute an infringement of the Act, it is unnecessary to require the products to be delivered up to the applicant.

Costs

29    The fifth issue is costs. The applicant seeks its costs as the successful party. The respondents contend that there should be a discount on the costs payable by them to the applicant because of the applicant’s lack of success on its joint tortfeasorship claim, such that the respondents pay 75% of the applicant’s costs. The respondents submit that the trial of the proceeding involved the determination of three main questions, namely:

(a)    Was the Playgo Device Mark substantially identical with, or deceptively similar to, Playgro’s trade marks?

(b)    Did the respondents ‘use’ as a trade mark the Playgo Device Mark in Australia?

(c)    Did Playgo Enterprises have a ‘common design’ with Myer to supply ‘PLAYGO’ branded toys for sale in Australia, such that Playgo Enterprises is a joint tortfeasor in infringing sales of those goods by Myer?

The respondents submit that a discount is appropriate because the applicant was successful in relation to part of question (a) and all of question (b), but unsuccessful in relation to question (c).

30    Further, in relation to the re-opened issue, namely whether the declaration and any injunction should extend to the word, ‘PLAYGO’, the respondents submit that the applicant should pay the respondents’ costs on an indemnity basis.

31    The principles applicable to the award of costs are well established. The usual rule is that costs follow the event, although there may be circumstances where the “event” is contestable, and also circumstances where it is appropriate to adopt an issue-based approach. See Latoudis v Casey (1990) 170 CLR 534 at 567; Ruddock v Vardarlis (No 2) (2001) 115 FCR 229 at [11]-[12]; Bowen Investments Pty Ltd v Tabcorp Holdings (No 2) [2008] FCAFC 107 at [3]-[5]; Queensland North Australia Pty Ltd v Takeovers Panel (No 2) [2015] FCAFC 128 at [11], [16]-[18]; Firebird Global Master Fund II Ltd v Republic of Nauru (No 2) (2015) 90 ALJR 270 at [6].

32    The principles applicable to the award of indemnity costs based on the way a party conducted the case at trial were considered in, for example, Fountain Selected Meats (Sales) Pty Ltd v International Produce Merchants Pty Ltd (1988) 81 ALR 397 at 400-401; Colgate-Palmolive Company v Cussons Pty Ltd (1993) 46 FCR 225 at 230-234.

33    In my view, in the present case, it would not be appropriate to discount the costs payable by the respondents to the applicant on account of the applicant’s lack of success in its joint tortfeasorship claim. That claim relied on essentially same evidence as the infringement claims and did not occupy a great deal of time at trial. The trial, which occupied two days, would not have been much shorter even if the alternative claim had not been brought. While it may be accepted that some costs before trial were incurred solely because of the joint tortfeasorship claim, the evidentiary overlap between the infringement claim and the joint tortfeasorship claim was substantial. In the circumstances, it is not appropriate to reduce the costs otherwise payable by the unsuccessful party to the successful party because of the latter’s lack of success on an alternative claim.

34    However, some departure from that position is justified in relation to the costs incurred since the delivery of the Reasons on 22 March 2016 because of the circumstance that the applicant in effect sought to re-open the case to make submissions on a point not made at trial. While I permitted the applicant to do this, the effect was to increase costs; had the applicant made submissions on the word, ‘PLAYGO’ at trial, the matter would have been dealt with during the hearing and it would not have been necessary for the parties to prepare further written submissions on the matter. For these reasons, I consider it appropriate to order that the applicant pay the respondents’ costs in relation to the further written submissions relating to the word ‘PLAYGO’ filed pursuant to the email from the Court dated 13 April 2016. These costs should be on a party-party rather than an indemnity basis. I do not consider the applicant’s conduct, in failing to make the submission at trial and then effectively seeking leave to re-open, to justify the making of an indemnity costs order.

35    In relation to the written submissions on orders dated 5 and 8 April 2016 and the hearing on 12 April 2016, these were in part concerned with the issue of the word, ‘PLAYGO’ and in part concerned with other matters relating to the orders to be made (including costs). I think it would be going too far to order the applicant to pay the respondents’ costs in relation to those submissions and the hearing on 12 April (on account of the applicant raising the issue of the word, ‘PLAYGO’), because the submissions and the hearing concerned other matters as well. On the other hand, the issue of the word, ‘PLAYGO’ loomed large in the submissions and the hearing on 12 April, and in these circumstances I do not think the applicant should have its costs in relation to these submissions and the hearing (notwithstanding its overall success in the outcome of the trial). In the circumstances, I consider it appropriate to order that there be no order as to costs in relation to the written submissions on orders filed on 5 and 8 April 2016 and the hearing on 12 April 2016.

Miscellaneous matters

36    The respondents seek an order that any application for leave to appeal (should leave be required) be filed and served within 21 days of the orders (rather than the 14 days that would otherwise apply). The reason is to provide some additional time to obtain instructions in circumstances where the respondents are located overseas. I am content to make this order.

37    The hearing in December 2015 was on all issues other than questions as to the nature or quantum of any pecuniary relief: see the Reasons, [22]. The matter should be listed for directions, on a date to be fixed, to deal with the outstanding matters. In the event that the respondents file an application for leave to appeal or a notice of appeal, it would be appropriate to consider whether the quantum hearing should await the outcome of those processes. This is a matter that can probably be dealt with on the papers in that event. The respondents seek an order that any order as to costs be stayed in the event that they file an application for leave to appeal or a notice of appeal. The applicant submits that such an order is unnecessary as the costs would not be recoverable until the conclusion of the hearing. This is a matter that can be dealt with, if need be, if the respondents file an application for leave to appeal or a notice of appeal.

Associate:

Dated:    9 May 2016