FEDERAL COURT OF AUSTRALIA

Bugaj v Bates [2004] FCA 1260

RICHARD BUGAJ & ANOR v NEAL ANTHONY BATES & ANOR

N 1394 OF 2004

STONE J

24 SEPTEMBER 2004

SYDNEY

THE COURT ORDERS THAT:

1. The notice of motion be dismissed.

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

REASONS FOR JUDGMENT

1                     I have before me an ex parte application for an Anton Piller order.  The notice of motion was filed in court today with the supporting affidavit of the first applicant, Richard Bugaj, sworn on 24 September 2004.  The application in this matter concerns a claim for infringement of Standard Australian Patent No. 766 609 pursuant to the Patents Act 1990 (Cth). 

2                     Pursuant to the notice of motion, the applicants seek an order that the respondents be compelled to permit Mr Bugaj to enter the respondents’ premises situated at 48 Sheppard St, Hume in the Australian Capital Territory and allow him to remove one front and one rear shock absorber from any rally-type motor vehicle and search for any other shock absorbers not affixed to any motor vehicles as well as any documents relating to the design, use or purchase of shock absorbers. 

Background

3                     The background to this matter is set out in Mr Bugaj’s affidavit.  Mr Bugaj is the sole director of the second applicant, a company formed and licensed to undertake research and development of designs patented by Mr Bugaj as well as build and supply products for motor sport and original equipment manufacturers in Australia and Asia.  The invention which is the subject matter of the patent is a shock absorber which is described as involving ‘freely floating pistons in two tubes connected by a rod’.  Mr Bugaj claims that this is a revolutionary concept that better controls the forces created by uneven road surfaces, allowing greater wheel contact with the road.  For present purposes I accept this claim. 

4                     Mr Bugaj states that in the second half of 1999 he approached the first respondent, Neal Bates, who is a team owner and rally driver, for assistance in trialling a prototype of his shock absorbers.  Those trials indicated that the shock absorbers were very effective and enabled the rally cars to travel more quickly than with other shock absorbers.  Mr Bugaj deposes that, using those shock absorbers, Mr Bates had considerable success driving for the Toyota team and, in particular, won both heats of a rally held in Melbourne in August 2000 and was placed equal first in the championship. 

5                     Subsequently, however, the commercial relationship between the applicants and Mr Bates did not develop, and the matter was dropped.  Mr Bugaj had no further contact with Mr Bates until June 2004 when he telephoned Mr Bates and advised him that his design was patented and that he was employing solicitors to protect it.  Mr Bates stated that he was not using Mr Bugaj’s design, and that he was welcome to come to the respondents’ workshop in Canberra to check this. 

6                     Mr Bugaj made several unsuccessful attempts to contact Mr Bates to arrange an inspection.  His evidence suggests that Mr Bates was deliberately avoiding him.  Mr Bugaj states that he managed to briefly inspect the shock absorbers on three Toyota rally cars at a rally held in August 2004 at The Entrance on the Central Coast.  He says that both front and rear shock absorbers appeared to be similar to the prototypes he had previously supplied however, it is not possible to be certain without removing the shock absorbers to examine them. 

7                     Mr Bugaj deposes to his belief that if he went unannounced to the respondents’ premises he would not be shown the shock absorbers and that the only way in which he can investigate the shock absorbers to see if there has been an infringement of his patent is to remove them.  He states: 

‘This could be done by me or a mechanic within only a matter of minutes.  Any spares could be taken apart in even less time.’

8                     It is for this reason that the applicants seek orders in the form of Anton Piller orders authorising Mr Bugaj, together with other persons including his solicitors, to enter the premises of the respondents and carry out the necessary checks. 

Relevant principles

9                     In Microsoft Corporation v Goodview Electronics Pty Limited [1999] FCA 754 (‘Goodview’), Branson J considered in detail the issues arising in relation to a request for an Anton Piller order.  Her Honour quoted at [9] the words of Powell JA in Long v Specifier Publications Pty Ltd (1998) 44 NSWLR 545 at 547, where his Honour said: 

‘Reduced to its essentials, an Anton Piller order is an order that the defendant to whom, or to which it is directed, should permit the persons specified in the order to enter upon his, or its, premises, and to inspect, take copies of, and remove, specified material or classes of material, indicating, where appropriate, documents, articles or other forms of property.  It is an extraordinary remedy, designed to obtain, and to preserve, vital evidence pending the final determination of the plaintiff's claim in the proceedings, in a case in which it can be shown that there is a high risk that, if forewarned, the defendant, would destroy, or hide, the evidence, or cause it to be removed from the jurisdiction of the court.  For this reason, such orders are invariably made ex parte.’ 

10                  I accept, as is clear on the authorities, that the court has power under s 23 of the Federal Court Act 1976 (Cth), supplemented by O 25 rr 1 and 2 of the Federal Court Rules, to make an Anton Piller order.  Given Powell JA’s description of the order, it is not surprising that the courts have taken the approach that the power should be exercised only in exceptional circumstances. 

11                  The criteria that must be met before a court will grant an Anton Piller order are set out in Anton Piller KG v Manufacturing Processes Ltd [1976] Ch 55, where Ormrod LJ said at 62: 

‘First, there must be an extremely strong prima facie case.  Secondly, the damage, potential or actual, must be very serious for the applicant.  Thirdly, there must be clear evidence that the defendants have in their possession incriminating documents or things, and that there is a real possibility that they may destroy such material before any application inter parties can be made.’

On the evidence before me today I am not satisfied that any of those criteria have been met. 

12                  In relation to the requirement for a strong prima facie case, I accept Mr Bugaj’s evidence that prototypes of his shock absorbers were made available to Mr Bates, and were satisfactorily trialled by him and found to be superior to others used at that time.  That fact, and the fact that Mr Bates has been apparently avoiding Mr Bugaj, are the only facts that have been relied upon to establish the ‘extremely strong prima facie case’.  In my view, this is patently insufficient to meet that criterion. 

13                  In fact, the damage, potential or actual, that the applicants identify in support of their application supports my view on the absence of a strong prima facie case.  The argument has been that unless the court makes the orders sought, the applicants will never know whether there has been an infringement.  This suggests to me that the Anton Piller order in this case is sought for an investigatory purpose.  In Goodview, Branson J at [26] said: 

‘The Court must, in my view, be careful to avoid the extraordinary jurisdiction of the Court to make an Anton Piller order from being subverted to a mere investigatory tool for applicants or indeed, from being used for any purpose other than the preservation of vital evidence pending the hearing and determination of a proceeding.’ 

14                  Finally, there is no evidence that the respondents have in their possession incriminating documents or things nor has there been any evidence put before me that would support the allegation that the respondents might destroy such material, if any, before any application inter parties can be made.  I have been invited to draw inferences to that effect from the evidence concerning the effectiveness of the shock absorber.  In my view, that is not sufficient to justify the inference sought.  For these reasons the orders sought must be refused. 

Associate:        

Dated:              28 September 2004