FEDERAL COURT OF AUSTRALIA

Australian Chinese Newspaper Pty Ltd v Chinese Press Pty Ltd (No 2) [2001] FCA 651

AUSTRALIAN CHINESE NEWSPAPER PTY LIMITED ACN 003 156 616 v CHINESE PRESS PTY LIMITED ACN 072 037 168

N 9 OF 2001

LINDGREN J

1 JUNE 2001

SYDNEY

THE COURT ORDERS THAT:

1.                  The motion brought by the respondent by notice of motion filed on 23 February 2001 be dismissed.

2.                  The parties file and serve any written submissions on costs by Friday 8 June 2001.

Note:    Settlement and entry of orders is dealt with in Order 36 of the Federal Court Rules.

REASONS FOR JUDGMENT (No 2)

1                     By a notice of motion filed on 23 February 2001, the respondent seeks summary dismissal pursuant to O 20 r 2 of the Federal Court Rules, which is as follows:

“(1)     Where in any proceeding it appears to the Court that in relation to the proceeding generally or in relation to any claim for relief in the proceeding:

(a)               no reasonable cause of action is disclosed;

(b)               the proceeding is frivolous or vexatious; or

(c)                the proceeding is an abuse of the process of the Court;

the Court may order that the proceeding be stayed or dismissed generally or in relation to any claim for relief in the proceeding.

(2)       The Court may receive evidence on the hearing of an application for an order under subrule (1).”

2                     On 17 January 2001, Whitlam J delivered reasons for judgment for refusing the applicant’s application for an interlocutory injunction under s 126 of the Trade Marks Act 1995 (Cth) ([2001] FCA 10) of which each party no doubt has a copy.  I gratefully adopt his Honour’s account of the background facts in pars [1] to [4] of those reasons for judgment.

3                     In par [11], Whitlam J said he was firmly of the opinion that there was no serious question to be tried that the respondent had infringed the applicant’s registered trade mark.  Encouraged by that statement, the respondent has brought the present motion for summary dismissal.

4                     There are two important observations to be made at the outset.  The first is that by its application which launched the substantive proceeding, the applicant seeks relief not only based on alleged infringement of its registered trade mark, but, as well, in respect of alleged contravention of ss 52 and 53 of the Trade Practices Act 1974 (Cth), infringement of copyright and passing off.  In the interlocutory application Whitlam J was called upon to apply only the “substantial identity” and “deceptive similarity” tests for registered trade mark infringement posed by subs 120(1) of the Trade Marks Act 1995.  He was not called upon to consider the elements of the other causes of action.  A case of misleading or deceptive conduct under s 52 of the Trade Practices Act 1974, for example, invokes a broad test which might, in its application to the facts of a particular case, be broader than that which his Honour was required to apply.  That is, in context, the manner of use by the respondent of the Chinese language masthead of its newspaper might be misleading or deceptive even though it was not substantially identical or deceptively similar to the Chinese language masthead of the applicant’s newspaper.

5                     The second general observation is that there is evidence before me which was not before Whitlam J.  In particular, senior counsel for the applicant has read an affidavit sworn 28 March 2001 of Chris Sai Cheong Ma, a graphic designer, sculptor and artist, which was not before his Honour.  I will refer to the expert affidavit testimony of Mr Ma in more detail below.

6                     Counsel for the respondent does not submit that Whitlam J’s decision on the interlocutory application gives rise to a res judicata or an issue estoppel, even in relation to the claim of infringement of the registered trade mark.  It does not.  An interlocutory application is one on which the order made, whether granting or refusing the relief sought, does not finally determine the parties’ rights, but leaves open the possibility that the final hearing will take place on different evidence; cf Licul v Corney (1976) 50 ALJR 439 at 444 (Gibbs J); Carr v Finance Corporation of Australia Ltd (No 1) (1981) 147 CLR 246 at 248 (Gibbs CJ), 253-257 (Mason J).  Counsel did, however, submit that I should give great weight to his Honour’s conclusion, having regard to the fact that the essence of the applicant’s case turns on the two mastheads.  But this submission does not take into account the expert testimony of Mr Ma to which I next turn.

7                     Mr Ma’s affidavit is to the following effect.  Mr Ma has been “formally trained in calligraphy”.  He has been living in Australia since 1996.  He has made comparisons of the applicant’s current Chinese language masthead, the respondent’s former Chinese language masthead and the respondent’s current Chinese language masthead (the respondent changed the “font” of its masthead in September 2000 (apparently on 22 September) to its present font and it is only the present font which has prompted the applicant to complain).  Mr Ma testifies as follows:

“Comparison of the Applicant’s Logo [masthead] and the Respondent’s Former Logo [masthead]

7.         For the reasons which I state below, in my opinion, the Applicant’s Logo and the Respondent’s Former Logo are quite similar.

8.         The way that a Chinese reader understands Chinese characters and their ideas is very different, in my experience, to the way that a person reading English would understand or appreciate words. In Chinese, each character may have a number of meanings or connotations. The intended meaning may only be apparent from the context in which the word appears. Therefore, for a Chinese reader to understand a particular sentence in Chinese or a particular phrase in Chinese it is necessary for that person to consider all the characters. As in English, there is a variety of ways to express the same idea. Just as each character may have a variety of meanings, so too do a number of characters have similar meanings. Just as in English, rhyming words or similar-sounding words, even though they may have a different meaning, may create or remind a person of another word, so too in Chinese this occurs.

9.         The sounds made when the Applicant’s Logo and the Respondent’s Former Logo are each read aloud are, in my opinion, quite similar. In my opinion, the third character is an insignificant word, and sound, that word does not take away from the similarity between the other words, and therefore the overall effect.

10.       Given the spoken similarity between the Applicant’s Logo and the Respondent’s Former Logo, the main point of difference is their use of different “fonts”. The Applicant’s Logo has been written, it appears to me by hand, in a font which is in the “li shu” style. This font was invented in the Chun Dynasty (B.C. 221-206) and became a popular font in the Han Dynasty (B.C. 206 – A.D. 220). To me, it signifies a particular style or font. It has a particular “feeling” or impression in my mind.

11.       Just as in English, there are many typefaces within a particular style of font, so too in Chinese there may be numerous type styles which are said to be within the “li shu” style. The “li shu” style is characterised by an appearance of handwritten fonts which have different types of strokes from other font families.

12.       In comparison, the Respondent’s Former Logo is in the xing shu style. This font dates from the Tang Dynasty (A.D. 618-907).

13.       To me, the differences in the font between the Applicant’s Logo and the Respondent’s Former Logo are striking.  At a casual glance, and even on a more careful inspection, the logos look different because of their difference in font.

Comparison between the Respondent’s Former Logo and the Respondent’s Current Logo

14.       The Respondent’s Former Logo and the Respondent’s Current Logo differ by reason of the change in font. In my opinion, this change creates a quite different appearance to the logo. In my opinion, a Chinese reader, familiar with basic Chinese characters and calligraphy, would understand there to be a difference between these two fonts and therefore a difference in the logos. I consider this difference to be significant from my own impression of the differences between the two fonts.

Comparison between the Applicant’s Logo and the Respondent’s Current Logo

15.       In my opinion, by reason of the use of the same family of fonts, the similarity between the Applicant’s Logo and the Respondent’s Current Logo is very close.

16.       I say this based upon the fact that a considerable number of Chinese speakers in Australia have received a formal education in the Chinese language. I was educated in Hong Kong. As part of my education when I was in school, I was required to study different fonts and calligraphic styles. As part of the school curriculum students are required to practise Chinese calligraphy by using a brush. I am aware from speaking with people of Chinese descent or migrants of Chinese speaking countries in Australia that they also received this kind of education. I am aware that Chinese in Australia in general have a strong concept as to the different fonts and typefaces of Chinese characters. Therefore, I am of the opinion that there are many Chinese speakers in Australia who are sensitised to the significance of a particular font.

17.       Furthermore, Chinese characters are, to some extent, pictorial representations of concepts. Therefore, to a Chinese reader, the representation of a particular character is more significant, than say, to an English speaker. The feel or appearance of a character is an important factor in conveying a message about a particular product in the case of the use of a collection of characters as a logo.

18.              The space enclosing a logo is also significant. Therefore comparing, by way of  example, the space occupied by the Respondent’s Former Logo with the Respondent’s Current Logo, the differences become apparent.”

8                     Summary dismissal is not lightly granted.  The test to be satisfied has been expressed differently in the authorities but all formulations caution against depriving a party of the right to have a claim heard and determined at trial in the usual way; cf Dey v Victorian Railways Commissioners (1949) 78 CLR 62 at 91 and 92 (Dixon J); General Steel Industries Inc v Commissioner for Railways (NSW) (1964) 112 CLR 125 at 129-130 (Barwick CJ); and cf Fancourt v Mercantile Credits Ltd (1983) 154 CLR 87 at 99, Webster v Lampard (1993) 177 CLR 598 at 603 and Munnings v Australian Government Solicitor (1994) 68 ALJR 169 (Dawson J) at 171 (upheld on appeal at (1994) 68 ALJR 429).

9                     In Australian Building Industries Pty Ltd v Stramit Corporation Ltd [1997] FCA 1318 a Full Court of this Court approved (at 23) of the following passage in Lonrho Plc v Fayed (No 2) [1992] 1 WLR 1 (at 5):

“A plaintiff is entitled to pursue a claim … however implausible and however improbable his chances of success. Unless the defendant can demonstrate shortly and conclusively that the plaintiff’s claim is bound to fail or is otherwise objectionable as an abuse of process of the court, it must be allowed to proceed to trial.” (emphasis supplied)

The Full Court similarly approved (at 27) the following passage from the judgment of Danckwerts LJ in Wenlock v Moloney [1965] 1 WLR 1238 (at 1244):

“… this summary jurisdiction of the court was never intended to be exercised by a minute and protracted examination of the documents and facts of the case, in order to see whether the plaintiff really has a cause of action. To do that is to usurp the position of the trial judge, and to produce a trial of the case in chambers, on affidavits only, without discovery and without oral evidence tested by cross-examination in the ordinary way. This seems to me to be an abuse of the inherent power of the court and not a proper exercise of that power.”

The Full Court stated (at 27):

“A proceeding should not be dismissed summarily merely on the ground that it appears at the early stage of the hearing of the motion brought for that purpose, to advance a highly implausible claim which will very probably fail.”

10                  I have considered carefully the respondent’s submissions in favour of summary dismissal but, notwithstanding some doubt, I do not think the test required to be satisfied for the taking of that extraordinary step, as discussed in the above authorities, is met in this case. 

11                  While the applicant’s case still seems to be a difficult one, the evidentiary position on a final hearing would be different from the limited one which was before Whitlam J, and would include, in particular, Mr Ma’s “close similarity” evidence.

12                  As Whitlam J recognised, even in relation to the test of registered trade mark infringement, one is concerned with more than a side-by-side comparison of visible ideograms.  The reason is that the “deceptive similarity” limb of subs 120(1) of the Trade Marks Act 1995 (cf the definition in s 10 of that Act), like the notion of “misleading or deceptive conduct” of s 52 of the Trade Practices Act 1974, raises questions of suggestion, connotation, impression and recollection.  In this respect, the expert testimony of Mr Ma set out earlier shows that the present case is the more complex because of the Chinese ideograms and fonts involved.  Questions arise as to the cultural background and the linguistic understandings and frames of reference which a Chinese language reading and speaking market will bring to bear to a reading of the mastheads.

13                  Counsel for the respondent relies on the fact that the first two figures in the masthead mean “Australian” and the fourth means “newspaper” and submits that the third, the appearance of which is clearly not identical as between the applicant’s masthead and that of the respondent, must be the only one which the market will regard as essential.  It will be recalled that the applicant’s third character is translated into the English word “New” and the respondent’s into the English word “Daily”.  While perceiving the force in this submission, ultimately I have decided that it does not carry the day on a motion of the present kind.  Mr Ma describes the third character as “insignificant”.  I also have regard to his expert testimony that to a Chinese reader, different fonts or calligraphic styles have a special significance for which there is no precise counterpart in English, and that:

“¼the feel or appearance of a character is an important factor in conveying a message about a particular product in the case of the use of a collection of characters as a logo.”

No doubt on a final hearing Mr Ma’s testimony will be tested in cross-examination and there may be contradictory expert evidence adduced on behalf of the respondent, with the result that the applicant will fail in any event.  But to my mind his testimony establishes, if only just, that the applicant’s case should not be denied a final hearing.

14                  One must also not forget that there may be further evidence before the Court on a final hearing relevant to the present issue.  In this respect, senior counsel for the applicant submitted orally as follows:

“¼at trial the evidence of Mr Ma and others will be relied upon to make the point that both on the question of identicality and similarity the court will be informed by actual evidence because they are factual questions to be determined.  I can only indicate at this stage, your Honour, that that evidence, in Mr Ma’s affidavit, is but some of the material that will be before the court.”

15                  For the above reasons the motion for summary dismissal will be dismissed.

16                  If the parties wish to make submissions on costs they must do so in writing by Friday 8 June 2001.  The proceeding will be listed on a later date, of which the parties will be advised, for the making of any order as to costs.

17                  The further progression of the matter to a final hearing will be a matter for Whitlam J as Docket Judge.

Associate:

Dated:              1 June 2001