FEDERAL COURT OF AUSTRALIA

Abrahams v Biggs [2011] FCA 1475

THE COURT DECLARES THAT:

1.    By publishing, on or about 29 June 2010, on their “bbsafe.com.au” web site –

(a)    the statement that the BB Safe Ring was half the price of currently available bed leg barriers; and

(b)    the statement that the BB Ring was about half the cost of similar products;

the respondents engaged in conduct that was misleading in contravention of s 52 of the Trade Practices Act 1974 (Cth) and made a misleading representation in contravention of s 53(e) of that Act, in that the standard price of the respondents’ goods so referred to was more than half the price of the applicant’s Bed Bug Barrier.

2.    By publishing, on or about 29 June 2010, on their “bbsafe.com.au” web site the statement that other bed bug barriers were either unsightly or provided a bridge for bed bugs once bugs were caught in the glue, the respondents engaged in conduct that was misleading in contravention of s 52 of the Trade Practices Act 1974 (Cth) and falsely represented that the applicant’s Bed Bug Barrier was of a particular standard or quality in contravention of s 53(a) of that Act, in that –

(a)    the reference to other bed bug barriers in which bugs caught in the glue would provide a bridge was a reference to the applicant’s Bed Bug Barrier;

(b)    it was not then and is not now established that, in the applicant’s Bed Bug Barrier, a bridge will inevitably or most probably be formed by bugs caught in the glue; and

(c)    it was and is unknown for a bridge to be formed by bugs caught in the glue in the applicant’s Bed Bug Barrier.

3.    By publishing, on or about 29 June 2010, on their “bbsafe.com.au” web site the statement that, according to the Bed Bug Code of Practice, the “Protector Bed” mattress encasement was “the only one found to be 100% effective”, the respondents engaged in conduct that was misleading in contravention of s 52 of the Trade Practices Act 1974 (Cth), in that –

(a)    the said Code of Practice did not contain a finding that the “Protector Bed” mattress encasement was “100% effective”; and

(b)    a different mattress encasement, the “Mattress Safe” product sold by the applicant, had been scientifically tested and was recommended in the said Code of Practice.

THE COURT ORDERS THAT:

4.    The application otherwise be dismissed.

5.    The proceeding be listed at 9:30 am on 6 February 2012 for the purpose of receiving the parties’ submissions, if any, on the question of costs.

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

REASONS FOR JUDGMENT

1    In this proceeding the applicant, Tony Abrahams, alleges that the respondents, Barbara Biggs (“the respondent”), and her company, Iaso Trading Pty Ltd (“Iaso”), appropriated confidential information about the utility of polytetrafluoroethylene (better known by, and hereinafter referred to by, the proprietary name under which it is marketed – “Teflon”) for preventing or impeding the access of bed bugs to beds. Declarations, injunctions, damages and orders for delivery up are sought in that regard. The applicant also alleges that, when the respondent caused certain denigratory statements to appear on Iaso’s web site, both respondents contravened ss 52 and 53(a) and (e) of the Trade Practices Act 1974 (Cth). Declarations and damages are sought in that regard.

the facts

2    Prior to the events which are presently relevant, the applicant was a property manager who provided services to the owners of about 40 properties. Those services included the collection of rent from tenants. In the course of this work, the applicant became aware of the problem presented by the infestation of properties with bed bugs. He became aware that, for landlords and tenants alike, bed bugs were a big concern, and the populations of them appeared to be increasing.

3    In about February 2008, the applicant decided to attempt to solve the bed bug problem, and established his own company called The Bed Protector Pty Ltd (“Bed Protector”). He became an Australian distributor for an American company that produced bed bug-proof mattress protectors. The feedback which he received, however, was that, although these mattress protectors helped to mitigate the problem, they did not solve it.

4    It seems that bed bugs can get into a bed by any route which provides physical access thereto, such as when a bed is placed against the wall, or when items are left draped on the bed in such a way as to be in contact with the floor. While it is possible to take measures to eliminate these points of access, bed bugs would always be able to secure access to the mattress by climbing up the legs of the bed. The applicant decided to address this problem.

5    Over the course of a period which was, it seems, nearly a year, the applicant invented a device that could be attached to the legs of a bed, either (in one form) at the point where the caster meets the floor or (in another form) at the point where the leg is attached to the bed. It is best described by reference to the abstract in a patent application which was filed on the applicant’s behalf on 29 May 2009:

A barrier for inhibiting migration of crawling insects to a bed via a bed leg is described. The barrier is co-operable with a bed leg such that an insect must cross the barrier to reach the bed. The barrier includes a trapping portion having a coating of a tacky substance to impede insects upon contact. The barrier may include a perimeter wall for defining a seat for a bed leg, or may include an aperture for enabling a fastener to pass therethrough for securing the bed leg to the bed.

An example of a device adapted for mounting between the bed and the leg was placed into evidence. It takes the form of a shallow cylinder about 83 mm in diameter and 21 mm deep. The upper face of the cylinder is closed, save for a 10 mm diameter hole in the centre, through which the bolt securing the bed leg to the bed would pass. Over a diameter of about 55 mm, the lower face of the cylinder is open, such that there is a kind of rim, about 12 mm wide, encircling that opening. Inside this rim, and supported by a short lip in the interior of the cylinder, is a cavity which would contain a tacky substance over which insects, and bed bugs in particular, cannot pass. The way the device is designed, in order to pass from the floor to the mattress, a bed bug would need to negotiate this substance, and could not do so. The applicant gave a name to this device: the “Bed Bug Barrier”.

6    Notwithstanding the viability of his invention, by March 2009 the applicant was starting to think of improvements that could be made to the bed bug barrier. One problem, apparently, was that the tacky substance, or glue, had to be replaced every two years. It seems that hotels and backpacker hostels were looking for a device that required little or no maintenance.

7    Stephen Doggett is a senior hospital scientist in the Department of Entomology at the Institute for Clinical Pathology and Medical Research at the Westmead Hospital. He is an acknowledged expert on bed bugs. Prior to the events which have become controversial in this proceeding, he had corresponded regularly with the applicant on the subject of mattress protectors, and with respect to bed bugs generally. The applicant introduced Mr Doggett to his Bed Bug Barrier, and Mr Doggett thought that it was a good idea which could work. At the invitation of Mr Doggett, in May 2009 the applicant presented his Bed Bug Barrier at a workshop of bed bug experts in Sydney.

8    The applicant was a contestant on the ABC television program “The New Inventors” broadcast on 20 May 2009. The program had been filmed on 14 April 2009, and the applicant must have been given some idea of the outcome since, on 19 April, he wrote to Mr Doggett saying that all three judges thought that his Bed Bug Barriers “were a fantastic idea”. In his email by reply, Mr Doggett opened up a subject which has become a significant element of the applicant’s case under the Trade Practices Act. It was whether barriers which operated by reference to a band of glue, or a similar tacky substance, would lose their effectiveness over time when large numbers of bed bugs became stuck in the glue, and formed a kind of bridge over which other bed bugs might pass unhindered. Mr Doggett said that there had been a discussion about the use of barriers in the deliberations of a recent working party, in the course of which Frank Meek, the international technical manager of a pest control company in the USA, had said:

… agree on the glue issue. If the population is high and bridge could form over the glue surface same with dust, lint and other particles that would gather. This is seen regularly in roach and mouse glue traps, stored product insect traps and even in fly light traps.

Mr Meek’s comments were regarded by Mr Doggett as “quite reasonable”. Mr Doggett added that he would like to see the applicant’s barrier made from “a super slippery plastic such as a Teflon product”. He added that this would “raise the cost considerably”.

9    In reply to Mr Doggett’s email of 19 April 2009, the applicant forwarded a lengthy email effectively defending the use of glue-based devices. In the course of that email, the applicant said:

He mention [sic] that they could make a bed bug bridge, there is about 60 square centimetres of glue in each barrier, if they were making a bridge over this then they would have caught thousands of bed bugs and I think this could only be seen as a positive outcome.

In his reply to that, Mr Doggett said:

To be honest, I have seen bed bug infestations that could have easily resulted in the glue being bridged, particularly in socially disadvantaged housing, which can also be very dirty.

Mr Doggett added that he “would still like to see a model that did not need glue”.

10    I shall set out the next two emails between the applicant and Mr Doggett, both on 20 April 2009, in full. First, from the applicant:

Thanks Stephen. A model without glue would mean the barrier would need to be made from something that is impossible for bed bugs to walk on, do you know of a material that they cannot walk on? You mentioned Teflon, is it impossible for bed bugs to walk on this?

Next, from Mr Doggett:

There are Teflon plastics with very low coefficients of friction, naturally any surface would have to be tested.

11    It was next in mid-May 2009 that the applicant took further steps in his quest for a bed bug barrier that did not require glue. On 15 May 2009, he contacted a New York based company called “Ecological Coatings” seeking information as to its Australian distributor. He was seeking supplies of a non-stick paint. He was given the name of an Australian distributor, from whom he requested a sample. On 21 May 2009, the distributor sent an email that said that the sample was “on its way”. The transactions just referred to were evidenced by copy correspondence. But what the applicant claims to have happened at about the same time was not. In his affidavit sworn on 30 June 2011, the applicant said:

On or around 18 May 2009, I contacted Gordon International Marketing, a supplier of high performance Teflon, by telephone and requested a sample of Teflon. In or about late May 2009, I received a 10cm x 8cm sheet of Teflon which I used in the development of New BB Technologies. I put a hole in the middle of the Teflon sheet and placed a bed leg through the hole and realised that I was on to something great. This was the beginning of the invention that later became the subject of Patent application 2010202206 ….

This evidence was controversial, for reasons to which I shall advert in due course.

12    The applicant’s bed bug barrier was the winning entry on The New Inventors, from which the applicant secured substantial publicity. One of those who promptly congratulated him was the respondent, whom he had known since 2003, by reason of his management of a rental property which she owned in Melbourne. She had had an unhappy experience with bed bugs in that property, and was, therefore, no stranger to the problem which led to the invention of the Bed Bug Barrier. The respondent, who lived in Sydney but happened to be in Melbourne at the time, visited the applicant at his home on the evening of 22 May 2009. What transpired at that meeting was the subject of great controversy in this proceeding.

13    In his original affidavit, the applicant said that the respondent visited him at his home on the evening of Friday 29 May 2009. In her affidavit, the respondent said that she was not in Melbourne that day, and exhibited copy travel documentation to make good that point. In that affidavit, she said, without elaboration, that she went to the applicant’s home on the evening of 22 May 2009 to collect rent, and that the applicant showed her a video of The New Inventors program. In his affidavit in reply, the applicant accepted that he was mistaken in saying that the respondent had visited his home on 29 May 2009, and accepted also that the respondent’s visit had been on 22 May 2009. He rejoined that the respondent could not have made that visit in order to recover her rent, since he had discontinued collecting rent on her behalf late in the previous year. In her oral evidence, the respondent accepted that the applicant was no longer collecting rent for her in May 2009. She said that she had surmised that she visited the applicant in order to recover rent, since, to her recollection, that was the only reason that she ever visited his home. Likewise, in his evidence, the applicant accepted that his placement of the visit on 29 May, rather than 22 May, was a matter of surmise on his part: he knew that the visit was on a Friday shortly after the screening of The New Inventors, and assumed that it was unlikely to have been only two days thereafter.

14    The respondent recalls that she did visit the applicant at his home on the evening of 22 May 2009, that she congratulated him on his success on The New Inventors, that they watched a video of the program, and that she indicated that the applicant’s invention was likely to make considerable money for someone. Beyond that, the respondent denies that anything of real substance, at least in the context of the present controversy, was discussed. The main factual issue in the case related not to things which the respondent claimed to recall, but to things which the applicant, and one of his witnesses, claimed to recall, and which the respondent denied.

15    As it happened, when the respondent visited the applicant on the evening of 22 May 2009, also present was one of the applicant’s close friends, Sean Christie. Both the applicant and Mr Christie gave detailed evidence as to their recollections of the conversation which occurred when the respondent visited the applicant’s home, notwithstanding that they both, initially, placed that visit on 29 May 2009. In each case, the applicant’s, and Mr Christie’s, recollection was recorded in detailed notes of the conversation with the respondent as they recalled it, in the form of sequentially-organised contributions to that conversation by the applicant and the respondent. Those notes were prepared, from recollection as it was said, in June 2011 when the applicant and Mr Christie came to make their affidavits for this proceeding. Originally, the applicant said that he made his notes in about mid-2010, but, after Mr Christie had given evidence, the applicant revised that estimate, to bring it into line with Mr Christie’s evidence, which I accept, that these notes were prepared in June 2011.

16    I have reproduced the applicant’s and Mr Christie’s notes in a schedule to these reasons, and have laid them out in a way which highlights the similarity of their treatment of the subjects with which they were concerned, both in point of content and in point of sequence. I consider it to be remarkable, and quite improbable, that two participants in a very casual conversation would, some two years after the event, record their recollections of it in such strikingly similar terms, and sequence. The applicant freely admitted that he had discussed the matters covered by these notes with Mr Christie before each of them placed his recollections on paper, but he resisted the suggestion that his assistance in the preparation of Mr Christie’s notes went any further than that. Both because of the similarity of the notes themselves and by reason of the circumstances to which I shall next refer, I find that denial highly implausible.

17    When he first gave evidence, the applicant was not cross-examined, or questioned by the court, about the process by which his, and Mr Christie’s, notes had been prepared. However, Mr Christie was questioned on the subject. He said that, when it came time for the applicant to prepare his evidence for filing in this proceeding, the applicant asked him to write down everything he could recall of the meeting with the respondent at the applicant’s home. Mr Christie said that, although he did have a conversation with the applicant in which they, in effect, jogged each other’s memory, when he came to write the note which was, in due course, exhibited to his affidavit, he did so without any assistance or input from the applicant. He said that he wrote out his recollection of the conversation in hand, on an otherwise blank sheet of paper, in a room at the offices of the applicant’s then solicitors. He said that no other person contributed to that process. Mr Christie’s recollection was that the document, when completed by him, was typed up by the applicant, rather than by a member of the solicitors’ staff. Mr Christie checked the typed-up product against his own handwriting, and found it to be correct (subject only to him having made a mistake about the date of the conversation). Notwithstanding that Mr Christie had previously been employed as a school teacher, I consider that his ability to recall the conversation with the respondent, in such detail in point of content and sequence, more than two years after the event, if that was indeed the situation, was remarkable.

18    When the applicant was recalled to give further evidence, I raised with him certain aspects of the notes which he, and Mr Christie, had exhibited to their affidavits, and which concerned me. He said that he prepared his notes on his own computer, and that, at the time, he had not seen a typescript of the notes prepared by Mr Christie. He accepted that his notes were to some extent reliant upon reminders which he had been given by Mr Christie. When it was pointed out to the applicant that the font apparently used for the preparation of his notes was the same as that used for the preparation of Mr Christie’s notes, and differed from the font apparently used in their affidavits as such, he accepted that Mr Christie’s notes “must have” been prepared on his computer. However, he absolutely denied that he typed up Mr Christie’s notes. The position which he was obliged to accept was that Mr Christie had used his (the applicant’s) computer to type up his own notes. When I reminded him of Mr Christie’s evidence that his statement had been written up by hand, the applicant really had no satisfactory explanation for that inconsistency. The solicitor who was then representing the applicant was still working in Melbourne as a solicitor, and there was no reason, known to the applicant, why she might not have given evidence on his behalf (other than that “they dropped the case”).

19    In due course, I shall be obliged to resolve the differences between the accounts of the meeting of 22 May 2009 given by the applicant and Mr Christie of the one part and by the respondent of the other part. At this point, however, I would indicate the following bases for my reservations as to the evidence of Mr Christie, to the extent that he was proffered by the applicant as a witness in support of his version of the course of that conversation. Mr Christie was a long-time, close, friend of the applicant. They met socially on a regular basis. That may not, of itself, give rise to any sense of disquiet as to the likelihood of Mr Christie’s evidence being accurate, but, under cross-examination in the present case, he left little doubt but that he had associated himself closely with the applicant’s cause. He was well aware, for example, of the tenor of the email exchanges which the applicant had with the respondent, and especially of the content of the respondent’s contributions. In answer to the respondent at one stage, Mr Christie said: “You wrote many, many emails repeating yourself over and over again, if I remember.” And he said: “You repeated yourself many, many times in those emails … I read them. You repeated yourself over and over again. It was almost obsessive. You were obsessed with getting into this business, somehow and you were pushing him …”. Mr Christie continued:

You were pushing him. From the day you got there I thought you were picking his brains too much. You were so interested in this Social Change Foundation. We skipped from homeless people to sex offenders, and helping the sex offenders, to helping people who have been offended by sexual assaults. It was a broad range of charities. And what you did then was – it was chopping and changing and you constantly wrote him emails and they were enormous, and he was running very short ... because he was so busy with ... [his] barrier. And that’s my answer to you. You came to him, and that moment you were there, you definitely said to him – you were talking about your charity; you were talking about all these connections you had; you name dropped.…

You had many thoughts. You had many thoughts about the charity; about various charities; about him making millions; about going to France with this product. You were clued into this. You saw this and you were clued – very into this idea of somehow getting into this business. You were very interested, very thoughtful. You came along and you were just like his biggest team supporter, and unfortunately, what happened when you came along, you were there; I got suspicious because I didn’t know you; I just heard stories, and who cares about that, but what I am saying to you is, you came around there and you said to him, “I am going to pick your brains”, and you went at it for an hour and a half, and you didn’t stop, and the emails were bombarding him constantly for days and days afterwards. Huge emails. We have got evidence of them.

In the light of this evidence, one would have to have reservations as to Mr Christie’s objectivity in his recollection of the course of the conversation on the evening of 22 May 2009.

20    If Mr Christie did prepare his notes of that meeting on a blank sheet of paper, as he said in his evidence, nonetheless he did so after discussing the matters with the applicant, and fully alive to the matters which had by then become controversial in this proceeding, and presumably fully conscious to the points which would be likely to advance the applicant’s cause. There are things which occurred at the meeting to which Mr Christie’s notes relate, but which find no mention in them. For example, and quite obviously, he, the applicant and the respondent occupied themselves over what must have been a substantial part of their time together watching the video of The New Inventors program, yet that circumstance finds no reference in Mr Christie’s notes. This leads me to conclude that, when Mr Christie prepared the notes, he probably did not make a conscientious, independent, attempt to retrace the course of the meeting from start to finish, but most likely attempted to focus upon those aspects of the meeting which might have the potential to support the applicant’s case.

21    I do accept Mr Christie’s evidence, however, that he first wrote out his recollections of this meeting in hand on a blank sheet of paper. I also accept his evidence that it was the applicant who typed the notes up. With respect to the latter aspect, I reject the applicant’s denials. Since he denied having typed up the notes, the applicant was in no position to give evidence as to the faithfulness of his reproduction of Mr Christie’s hand-written draft. The fact that the draft was typed up by the applicant himself, rather than by a member of the staff of his solicitors, is a source of considerable disquiet. That the applicant also prepared his own notes at about the same time, and that the two sets of notes are so strikingly similar, notwithstanding the passage of some two years of the events in question, redouble that sense of disquiet.

22    I shall return to this meeting on 22 May 2009, but first I shall continue laying out the broad chronology of the events which are relevant in the present case.

23    At 12:54 am on 24 May 2009 (that is, effectively very late on the night of Saturday 23 May), the respondent sent a lengthy email to the applicant. She commenced “after I called you tonight, I had a thought”, but there was no other evidence about any such telephone call on the Saturday night. In her email, the respondent raised the idea that the applicant might, in effect, make his Bed Bug Barrier available to a philanthropic business organisation, such as “Justice Action”, a prisoner advocacy group in NSW. Although she admitted to a reluctance to being seen as “just another person trying to join the throng of others who want a piece of your action”, the respondent said:

Imagine if the distribution of the bed bug catcher was the business arm of a not-for-profit organization that ran social programs that no other philanthropic organization would have a bar of because they’re too cutting edge, or too controversial?

….

Or, imagine a philanthropic organization that could fund an interactive website for victims of child abuse or any number of other cutting edge social programs, for homelessness, drug addicts etc.

The respondent gave examples of other charitable or philanthropic organisations that could benefit from being associated with a profitable business. The respondent referred to “Sally’s dad” in the email, from which I infer an assumption on her part that the applicant knew who Sally was. It was not suggested by the applicant that any such assumption would have been misplaced. Sally was Sally Gibson, a friend of the respondent, whose father Wal was a successful entrepreneur. In her email, the respondent suggested that Mr Gibson might be able to assist in an enterprise of the kind which she had in mind.

24    The respondent also referred to the fact that her solicitors, Clayton Utz, had been working pro bono on the registration of a philanthropic foundation, called the “Social Change Foundation”, which she established. She mentioned other people who were giving their time to the administration of that foundation. In her email, the respondent continued:

If you were to consider handing over worldwide distribution to a business arm of the Social Change Foundation, I would make a lump sum payment to you from the proceeds of the sale of Mitford St. The sum to be determined by advice from, let’s say, Sally’s dad, Wal Gibson. This would be conditional upon Wal agreeing to be involved and coming on board to assist with business advice. I haven’t even talked to him about it yet. You, of course, would also be on board. You could be involved as much or as little as you wanted. It could give you that life purpose, or destiny, that we talked about the other day.

The respondent said that this was “just a crazy idea I had soaking in a hot bath tonight”, and that she had not thought it through. She said that she would like to talk to Mr Gibson first. She said that the applicant would still get his “$3 per unit” but that he would hand over the distribution to the foundation “in exchange for a lump sum up front payment”. She invited the applicant to discuss the idea with her before she returned to Sydney.

25    I infer that, on or before Monday 25 May 2009, the applicant had accepted the respondent’s invitation to visit a friend of hers, Jan Owen, of “Social Ventures Australia”. The object, according to the respondent, was to introduce the applicant to “innovative social venture ideas”. I so infer because there is an email from the respondent to the applicant, sent at 11:30 pm on 25 May 2009, suggesting that the applicant might pick her up from her flat at about 11:30 am on the following day, so that they might go together to Social Ventures in South Melbourne. In the same email, the respondent told the applicant that she had heard that Mr Gibson would be available to meet with them at 7:00 pm the following day, 26 May. She added:

Also, these meetings, of course, are just talking and sussing things out. No obligations or expectations anywhere.

By a return email sent almost immediately, the applicant accepted the proposal to meet Mr Gibson the following evening.

26    On 26 May 2009, the respondent and the applicant met with Ms Owen in a coffee shop in South Melbourne. The detail of that meeting is presently immaterial. It is the exchanges which passed between the applicant and the respondent on their way to and from the meeting which need to be considered. According to the applicant, as he and the respondent were driving to meet Ms Owen, he told the respondent that he had “other inventions coming”. He said: “One is non-stick paint and the other is a Teflon barrier.” Having passed this information on to the respondent, he began to worry that she might say something to third parties about these other inventions which the applicant had mentioned. Thus, when they returned to his car after the meeting with Ms Owen, the applicant said to the respondent something to the following effect:

I am happy to meet these people but you realise all the information I am giving you is strictly confidential. I am happy to talk to them about the Bed Bug Barrier but I don’t want you talking about my new inventions.

In his oral evidence, the applicant said that this conversation occurred in the car as he was driving the respondent home after the meeting with Ms Owen.

27    According to the respondent’s affidavit, it was after the meeting with Ms Owen that the applicant first mentioned the Teflon idea. She asked him what he would do if China copied his device. He said not to worry about that, as “I have Bed Bug Barrier Mark 2”. The respondent asked what that was, and the applicant said that it was “the Bed Bug Barrier coated in Teflon”. The respondent inquired “why Teflon?”, and the applicant replied “because bed bugs can’t crawl on it”. The respondent inquired how he knew that, and the applicant responded “Stephen Doggett told me”. The respondent insisted that this was the first occasion upon which the applicant had told her of his idea of using Teflon for a bed bug barrier.

28    However, while under cross-examination, the respondent was asked whether the applicant had told Ms Owen about the use of Teflon, to which the respondent replied: “I think I had already told her so that she knew that when you arrived.” On the basis (which is common ground) that the applicant and the respondent arrived together to confer with Ms Owen, this evidence is consistent only with the respondent having informed Ms Owen about the use of Teflon at some time before she and the applicant travelled by car to meet Ms Owen. Indeed, it was not the respondent’s evidence that the applicant said anything about the matter in the car on the way to the meeting. That the respondent would have informed Ms Owen about Teflon on some earlier occasion is consistent with the evidence of the applicant and Mr Christie that she was told about it on the evening of 22 May 2009. There was no suggestion in the evidence that she might have been so informed on any intervening occasion, but that too was quite possible.

29    On the evening of 26 May 2009, the applicant and the respondent met with Mr Gibson as previously arranged. According to the applicant, Mr Gibson provided him with “free information about patent protection and his experiences with and knowledge about worldwide distribution of a product”. According to the respondent, they discussed the applicant’s Bed Bug Barrier and the commercialisation of it. Nothing turns on what transpired at that meeting with Mr Gibson.

30    At 11:28 pm on 26 May 2009, the respondent sent another email to the applicant. She said:

Hearing Wal talk tonight was certainly sobering. It seems many things can go wrong and it’s certainly no walk in the park. I think his advice of going slowly and steadily as she goes, was good.

It was also enlightening and heartening to see that you actually seem to have most bases covered. You said you don’t want to be a businessman running a bed bug protector company, but you actually seem very good at it.

My advice, which I think Wal was saying too, is to trust your instincts about people. If you think someone is dodgey [sic], trust that and don’t go near them.

The following day, 27 May, the applicant emailed the respondent, thanking her for introducing him to Mr Gibson. After mentioning that he intended to seek some help from someone he knew who was a buyer at Bunnings, he concluded: “Thanks for all your help and support. See you next time you’re in Melbourne.” The respondent replied promptly, commenting that Mr Gibson had made it clear that “it’s a dog eat dog world out there” and adding, “if you want me to try France for you, as maybe a tester in Europe, let me know.” The applicant replied that evening saying, “Sure you can try France”.

31    The applicant and the respondent (by now in Sydney) exchanged a number of emails on 28 May 2009. The first three were from the respondent and, relevantly to the topic presently of interest, made mention of some preparatory issues which would need to be addressed if she were to take the applicant’s product to France. The applicant replied to these in a brief but enthusiastic email: “That’s fantastic, thanks for all your help”. At 5:07 pm that day, the respondent sent a more lengthy email which included the following:

As you know, I’d see this as an income stream for the Foundation. Spending a year getting it up and running with an income stream would be a year less I’d have to spend fund raising in some other way. But I’d have to offer you something that others can’t or haven’t yet. The reason I’ve suggested France where you don’t have any existing contacts. No need to tie anything up right now while everything’s coming at you. It must be overwhelming. I think you and I trust each other so I don’t need contracts and agreements yet. I’m happy to go and sus it out and then come back to you with what I find, and what I can do there. If/when I find funds are needed, I guess that’s when we’d need to come up with something that you’re happy with. You may have funds yourself by then and want to fund patents etc. but you may not and want me to put up some dough. That’s when we’d need to work out an agreement. It’s a rocky road and China ripoffs seem the biggest risk. One reason doing a patent in Europe earlier, rather than later, in my view, is a good idea. In theory, there’s no reason why that European guy couldn’t take out a patent on it right now over there. Does anyone other than you have samples? Does the New Inventor program show it up close enough for someone to apply for a patent based on the program alone? I guess you’ll need to have nerves of steel and your wits about you at all times with this. You say everything’s happening and nothing. I guess that means nobody is prepared to put any money down. If you want upfront funds, I’d be prepared to risk $50,000. I don’t know what you’d give me for that, I’m just telling you that’s what I’d be prepared to risk at this moment. Things may change. The longer you wait, the greater risk others will copy. On the other hand, as Wal says, steady as she goes, don’t rush into anything. What a balancing act!

32    At 7:39 pm that day, the applicant replied, stating that he had a worldwide provisional patent that was valid for 12 months, “so we have a bit of time”. He continued:

What do you think about this for the $50,000. I presell (not sure if that is a word) you 25,000 barriers ($2 each) which you can re sell for $3 or $4 each in France, so you could possibly make up to $100,000 for your $50,000 investment. If you’re not able to sell them then I can buy them back off you went [sic] I start making a few sales. Simple idea but would work for both of us. Also having sales of $50,000 already would look good for my business plan etc. let me know what you think.

With that email, the applicant forwarded a copy of an email which he had received from a company called “Bed Bug Central” in the USA, which had expressed an interest in purchasing 16 Bed Bug Barriers. The respondent’s reply sent, at 8:13 pm that day, was somewhat less enthusiastic than had been her earlier correspondence:

Well, what you’ve offered sounds interesting, however, my intention of investing isn’t simply to make a good return on my investment. My intention of putting money up front with you would be to do a lot of work to get distribution lines with the view to keeping it going in that jurisdiction as an ongoing income stream. Before agreeing to your suggestion of buying yours and importing them into France (who would cover the cost of getting them to France?) I’d like to explore Wal’s idea of getting quotes from a sourcing company in China. It seemed impossible to Wal, and me, that it would be cheaper in Australia than China. If it can’t be sourced cheaper, and I do buy the units from you in Australia, how would you feel about adding to the agreement you’ve suggested, that nobody else can distribute in France for a specified period, conditional on me moving that 25,000. i.e. if you have to buy them back from me, the agreement lapses. Also, if you start to do internet sales, or the American guy does, where does that leave me? Or you for that matter. We could both spend a year setting up distribution etc only to find everybody’s ordering online from the US.

In that email, the respondent also mentioned that Mr Gibson had said that “worldwide patents [were] virtually worthless” and expressed a real concern that a manufacturer in, for example, China would copy the bed bug invention from what had been shown on The New Inventors program, and then sell it over the Internet at prices which undercut the applicant (and, should it come to pass, the respondent also in France).

33    During the night of 28/29 May 2009, the turn which the email correspondence with the applicant on 28 May had taken was preying on the respondent’s mind. She had “a restless sleep”, as it occurred to her that the applicant’s offer to sell Bed Bug Barriers to her was an indication that he saw her “more as a customer than a social venture partner”. During this sleepless night, the respondent (in her words) “came up with the idea of Teflon coating bed legs, thus removing the need for a separate device to prevent bed bugs accessing a bed”. She did not pretend that the idea of using Teflon as a barrier for bed bugs had not been given to her by the applicant, but the notion that the bed legs as such should be coated with Teflon was, according to her evidence, one which occurred to her during this sleepless night.

34    I shall return to the steps which the respondent took in that regard presently, but, as she said in her evidence, on the morning of 29 May 2009, she sent “one further email” to the applicant. That email was substantially concerned with patent issues in connection with the proposal to distribute the applicant’s product in France. Nothing further needs to be said about it, its significance being that it was the conclusion of what had, over the previous week, been a course of quite intense email correspondence passing between the applicant and the respondent, but particularly originating from the respondent. From that point forward, the applicant and the respondent went their separate ways, and were not in further communication with each other until January 2010 in circumstances which I shall relate in due course.

35    In his investigation of non-stick paint and Teflon technologies to impede the progress of bed bugs, the applicant was hampered by an inability to obtain supplies of bed bugs for testing purposes. In September 2009 he did so, and he discovered that, while adult bed bugs could not climb up a non-stick painted surface, immature bed bugs could do so. But neither could climb up a Teflon surface. According to the applicant:

I now knew that using Teflon was an improvement on the BBB because it meant I didn’t need to use glue and I could replace the glue with Diatomaceous Earth to kill bed bugs.

I then decided that I may be able to use a combination of paint, Teflon and Diatomaceous Earth to kill bed bugs and prevent access. If I replaced the glue with Diatomaceous Earth and used Teflon on the outside of the barrier to prevent access to the bed then I would have a killing barrier that would kill bed bugs for years and years with no maintenance.

That is to say, the applicant was then working towards a result in which a device generally in accordance with that which he took to The New Inventors would be wholly or partly coated in Teflon, and would contain a pesticide in place of the previous glue.

36    However, the second half of 2009 was not a propitious time for the applicant. Although not part of his evidence as such, I would accept what he told me in opening about this period:

… [A]fter I went on The New Inventors, my life just turned upside down and I was so busy with, you know, world wide distribution and I had to try and get the glue in the cups as you can see there and that was a complete disaster. It took months and months and months. It was extremely stressful and, you know, I tried to use, you know, sheltered workshops to do it and they ended up, you know, there was glue everywhere and I had to start back at scratch.

In January 2010, the applicant re-established contact with the respondent. But before I come to that event, I shall trace the respondent’s own activities since her last email to the applicant in May 2009.

37    On 29 May 2009, the respondent mentioned her idea of coating bed legs with Teflon, to which I have referred in para 33 above, to her then partner, Stephen Trethowen, a former scientist who had worked with the CSIRO. He suggested that she telephone the CSIRO and DuPont, which manufactured Teflon, with a view to having them confirm that Teflon could be used as a barrier for bed bugs. The respondent attempted to obtain some assistance from the CSIRO, but without success. She also spoke to someone at DuPont, but he could not confirm that Teflon could be used as a barrier for bed bugs.

38    The respondent then asked Mr Trethowen to telephone Mr Doggett to discuss the subject. He did so, and explained to Mr Doggett the idea of bed bugs not being able to crawl on Teflon. Mr Doggett said that he believed that to be the case. After the telephone call (during which the respondent was present), Mr Trethowen told the respondent of Mr Doggett’s view that, subject to testing, bed bugs could not crawl on Teflon. On the strength of that information alone, the respondent instructed a patent attorney to file an Australian patent application titled “bed bug reduction method”. The application as made is not in evidence, but a draft of the complete specification is. It was said that the invention would provide –

… a method of bed bug infestation reduction by the method of applying a low coefficient of friction material to the substantially vertical surfaces of the support structures of beds.

As to how this would be achieved, the draft specification stated:

A Teflon® coating may be applied as a liquid to the material from which a bed leg is made. Alternatively it may be applied as a film of material, or in another arrangement, at least a portion of the leg could be manufactured from Teflon® itself, for example in the form of “feet” affixed at the lower end of the leg.

It is clear from the diagrams attached to the draft specification that the respondent had in mind something in the nature of a coating or tape which could be applied to the bed leg or, as noted above, that a portion of the leg itself could be manufactured from Teflon.

39    On 23 July 2009, the respondent made contact with Mr Doggett by e-mail. She said that she had recently lodged a patent for a bed bug device. Her long term objective was to provide a basis for fund raising for her Social Change Foundation. She sought an opportunity to speak to Mr Doggett about her device. When Mr Doggett asked the respondent for a “brief overview of the device and how it works”, the respondent said that the device was “basically putting a strip of Teflon on bed legs to prevent the bugs crawling up them”. She said that it was not “a device but integrated into the bed”. In reply, Mr Doggett said that he had been looking at “a similar system, albeit slightly different application process”, and that any product based upon the respondent’s patent “would be up against devices like the Climb up Interceptor and the Bed Bug Barrier, both [sic] which also function as bed bug monitors.” However, Mr Doggett was prepared to meet the respondent, and he did so on 30 July 2009.

40    That meeting lasted for about an hour. Mr Doggett told the respondent that the idea of using Teflon as a barrier was not his. He said that the use of Teflon as a barrier against bugs was already known by many people, particularly by entomologists who had used it to contain their laboratory samples, and that he recalled using it himself for that purpose about 20 years earlier. At this meeting, Mr Doggett realised that the respondent’s ideas were similar to those which he had previously discussed with the applicant, specifically with respect to the use of slippery paints. Mr Doggett did not, however, disclose to the respondent the nature of his discussions with the applicant, or the identity of the applicant. Neither did the respondent mention the applicant or his product.

41    Over the ensuing months, the respondent made many inquiries as to the technical and commercial aspects of the implementation of the ideas which were embodied in the draft complete specification to which I have referred. Those inquiries extended to manufacturers of Teflon, in the course of which the respondent discovered that painted Teflon would have to be baked to such a high temperature as to make the idea impracticable for application on to wooden bed legs. She made inquiries of manufacturers in China with a view to ascertaining the cost of production of bed legs treated in the way she proposed. I need not provide further details of these exertions by the respondent, since ultimately they came to nothing.

42    In July or August 2009, Mr Trethowen suggested to the respondent that she might take a different approach. He suggested that she consider cutting a disc of solid Teflon, and fitting that to the top of the bed leg. The respondent did not immediately take up that suggestion, but by 15 September 2009 she had commenced to make inquiries of manufacturers, with a view to ascertaining the cost of production of such discs. The first documentary evidence of these inquiries, and of the respondent’s interest in the disc idea generally, is a communication from her to a coatings company on 15 September 2009, in which she suggested that “we could put a thin disc of either pure Teflon, or metal coated in Teflon, between the bed leg and the mattress base”. In response, the respondent was quoted $2 per piece for Teflon-coated rings, and considered that that was too expensive.

43    However, the respondent continued working on the Teflon disc idea. She arranged for a piece of Teflon to be sent to her. She maintained contact with Mr Doggett, with a view to him testing any prototype product that she made. She made contact with scientists in other disciplines with a view to understanding the relationship between the properties of Teflon and the crawling mechanisms of bed bugs. This work on the part of the respondent led to her filing a patent application, titled “insect infestation reduction method”, on 25 September 2009. The specification was an adaptation of the draft to which I have referred in para 38 above, this time including the insertion of a Teflon, or similar, disc or plate between the top of the bed leg and the mattress base.

44    On the instructions of the respondent, Mr Doggett carried out tests on the ability of bed bugs to obtain traction on Teflon. His first report to the respondent was dated 3 November 2009, and demonstrated that bed bugs were much less able to obtain traction on a sheet of Teflon, when tilted to varying degrees, than on a piece of chipboard, which he used as a control.

45    Mr Doggett conducted a second test in early January 2010, this time using Teflon discs attached to wooden spindles which simulated bed legs. Again, it seems, Mr Doggett used chipboard as a control. The results were reported to the respondent by email dated 21 January 2010. To say the least, the results were encouraging for the respondent: in the control group, 73.6% of the bed bugs had walked on to the chipboard, whereas, in the group where the respondent’s discs were used, 0% did so. Mr Doggett described this result as “another success story”. He proceeded to repeat the test, using a more virulent strain of bed bugs. This time, 98% of the bed bugs in the control group crossed over, but, again, 0% did so when the Teflon disc was inserted.

46    It was at about this time that the applicant made further contact with the respondent. He did so, of course, unaware of the respondent’s work on her Teflon device, and unaware of her interactions with Mr Doggett. In his email, he referred to the problems which he had encountered when he engaged a sheltered workshop to have the glue inserted in his bed bug barriers (see para 36 above), and said, in effect, that this amounted to a substantial commercial setback for him. He described the technical and commercial difficulties which he had encountered finding a way to automate the insertion of glue into his barriers. However, by the time he resolved that issue, he was “running out of money”. He said that he was “looking for investors to get me over this hurdle”, and thought the respondent might be interested. He suggested that the respondent might take 10% of his business for an investment of $30,000, adding “I’m planning on making millions so it would be a great return for you”. The respondent replied immediately, saying that she had been putting off contacting the applicant “because, you’ll probably feel pretty angry to hear, when you didn’t seem interested in the Social Change Foundation idea, I started going down my own bed bug path”. She said that she had her own patent, and that half of her profits would go to the foundation. However, she saw possibilities in incorporating what the applicant was doing with what she was doing herself, and suggested that they have a talk.

47    On 25 January 2010, the applicant telephoned the respondent, and, in the course of the conversation that followed, learnt that the invention which the respondent had patented was a bed bug protection device made from Teflon. After that conversation, the respondent sent an email to the applicant, accepting that “this must have been quite unexpected”. The applicant sent an e-mail in reply, as follows:

To be honest I was completely shocked when you told me but thinking about it I still have the only discreet bed leg barrier that is also a monitoring system which is what the hotels want. Hotels want to know if the [sic] have an infestation before someone gets bitten. Teflon is a great idea but it won’t give hotels the heads up so it really is a different product to mine.

Still on 25 January 2010, the respondent replied as follows:

I thought you might be shocked but if I didn’t do it someone else was going to and I figured since I’m trying to do something quite important with any possible money made from it might as well be me.

I’d been trying to figure out how to tell you for a while but figured we’d bump into each other sooner or later and I’d let you know then….as it happened.

It certainly wasn’t planned and since we last met in about January, I didn’t do anything about it until almost July so it wasn’t as if I rushed out to compete with you. It just kept coming into my mind as a solution to funding this Foundation that is going to be extremely hard to get donations for being as how I want to set up treatment programs for child sex offender – like who would?

48    The events just described led to the applicant causing a letter of demand to be sent to the respondent on 7 April 2010. On 12 April 2010, the respondent denied the applicant’s allegations. The present proceeding was commenced on 21 September 2010.

49    Iaso was incorporated by the respondent on 12 April 2010, with the intention of it being the trading entity for her Teflon disc. Iaso published a web site called “bbsafe.com.au” on 14 May 2010, the contents of which were written, and updated from time to time, by the respondent. Statements which appeared on the web site at about the end of June 2010 provide the foundation for the applicant’s claims under the Trade Practices Act in the present case.

50    The respondents’ product was the subject of a segment of the Today Tonight television show on 28 June 2010. The content of the segment was as follows (as recorded by the applicant from the show’s web site the following day):

Dubbed the pest of the 21st century, bed bugs are in plague-like proportions worldwide. Finding a solution has reached desperation point. Barbara Biggs is an author and inventor of the BB Safe Ring which starves out bed bugs. “It’s huge. We’ve got 400 times more bed bugs now than we did just a few years ago,” Barbara said of the issue. “We want to stop the problem by stopping people getting bitten before it becomes a problem,” Barbara said. Invading homes, hotels, hospitals, schools, mattresses, couches, then every nook and cranny – the bloodsuckers attack occupants all over. Greg Mills from Allpest said the only way to combat bed bug infestations is with drastic action – strong chemicals and disposing of all furniture and contents. “20,000 bugs would be conservative. This is just what we can see in a quick 5 minute inspection,” he said. “A year ago we did no jobs, now we’re doing hundreds. In a world economic crisis, the bed bug industry is booming, absolutely booming,” Greg said.

The show’s web site named the respondent and the bbsafe web site as points of contact in relation to the segment. It was said that Today Tonight viewers would be “able to purchase the BBSafe ring for half price”, and they were directed to the bbsafe web site.

51    According to material downloaded by the applicant on 29 June 2010, statements to the following effect appeared on that website:

    “Half the price of currently available bed leg barriers”;

    “Other bed bug barriers are either unsightly or provide a bridge for bed bugs once bugs are caught in the glue”;

    “The BB Ring is about half the cost of similar products, making it the most cost effective and durable product on the market”.

52    Although the respondents’ bbsafe.com.au web site was substantially concerned with their Teflon disc, a page on the site was headed “A Systems Approach to Prevention and Control of Bed Bugs”, on which the following statements appeared:

No one solution prevents bed bugs. According to the Bed Bug Code of Practice, a systems approach is the only effective prevention. This involves four measures:

1) A leg barrier such as the BB Seucre [sic] Ring, the only no-maintenance barrier 100% effective and suitable for hotel use. It is easy to install, durable and enhances the effectiveness of other parts of a systems approach …

2) The Protector Bed mattress encasement – the only one found to be 100% effective. See www.bedbbugsalert.com [sic] for more details.

3) A Bed Bug Alert to allow early treatment at early infestation stage. This is a simple device placed in the corner of a room, or under the bed, which is a monitoring device to provide an early warning. www.bedbugsalert.com. for more details see www.bedbugsalert.com

4) A device to stop the bedhead touching the wall, another access point to the bed. The BB Secure Ring can be used between the two door-stopper type rubber plugs to prevent the bed butting up to the wall ….

53    The Today Tonight program had an impact on one of the applicant’s commercial arrangements. Mario Pizarro is a director of a concern which goes by the name of “Landmark Investments”. He has a background in property ownership and investment, and has contacts amongst property owners. In about June 2010, the applicant – with whom Mr Pizarro had had dealings over a number of years – contacted him and suggested that he might become a distributor for mattress protectors and bed bug barriers. After some discussion about the subject, Mr Pizarro placed an order and, on 20 June 2010, Bed Protector sent him an invoice in the total sum of $144,250. Of this, $90,000 was for 20,000 Bed Bug Barriers (10 x caster; 10 x screw-in) at a unit price of $4.50. Mr Pizarro’s intention was to on-sell these to property owners whom he knew.

54    However, in late June 2010, one of Mr Pizarro’s employees told him of the bed bug segment on the Today Tonight show. Mr Pizarro himself then found out (from the show’s producers) the identity of the web site for the respondents’ product, viewed that web site and, in his own words, “I was very disappointed because the statements I read on the web site made it appear that Mr Abrahams’ bed bug protection products were not 100 per cent effective.” Mr Pizarro then rang the applicant and cancelled his order because he believed that too many people would have watched Today Tonight, and would not be interested in buying the applicant’s products.

55    Mr Pizarro was cross-examined about these matters by the respondent. That enabled the court to get a clearer and more rounded impression of why he cancelled his order with the applicant than was possible from the terms of his affidavit, from which the above narrative is taken. In the result, I would make the following findings. The purchase and re-sale of bed bug barriers was not Mr Pizarro’s main line of business. However, because of the exclusivity which, from what he had been told by the applicant, the Bed Bug Barrier enjoyed as a mechanism against the march of bed bugs, he saw the opportunity to generate a profit from sales made to property owners. But the respondents’ web site demonstrated to him that the applicant’s product was not exclusive – he came to wonder how many other products purporting to solve the bed bug problem there might be – and that there may well be real issues with the effectiveness of that product. Whether there was any substance in the respondents’ criticisms of the Bed Bug Barrier was not Mr Pizarro’s main concern. The fact is that these things had been said and would presumably come to the attention of property owners in whom he might otherwise be intending to generate an interest in that product. This not being his main line of work, it was not worth his while getting involved in the merits of the debate. The reality is that he could no longer be assured of a reasonably swift turnover of the products which he had ordered from the applicant.

56    The other impact which the Today Tonight show had on the applicant relates to a Mr Dane Kip Lyons of a company which traded as “Noleema Services”. He had offered to invest $200,000 in the applicant’s business, in exchange for a 20% share of the business. However, after Mr Lyons had seen the show, he told the applicant that, because of what was said during the segment, he had lost confidence in the applicant’s products. He reduced his investment offer to $10,000.

confidential information

57    In his Further Amended Statement of Claim, the applicant identified the confidential information by reference to which he sued as follows:

The information of a confidential character was:

a)    the use of a Teflon barrier as a bed bug barrier;

b)    the location of the Teflon barrier sitting on a bed-leg and preventing bed bugs crawling up from the bed leg to the mattress;

c)    the belief, subject to testing, that Teflon was a super slippery surface that would prevent passage of bed-bugs;

d)    the use of Teflon removing the need for a glue or tacky substance as used in the said patented bed bug barrier;

e)    that the Applicant had not as yet but intended filing for patent protection for the Teflon barrier.

The applicant alleged that he communicated that information to the respondent in confidence on their way to the meeting with Jan Owen on 26 May 2009 to which I have referred. He added that all of the confidential information was communicated to the respondent at their meeting at his home with Mr Christie on what was then said (ie in the Further Amended Statement of Claim) to be 29 May 2009. He alleged that the information was communicated for the sole and limited purpose of the possible future involvement of the respondent in the applicant’s business of the manufacture and distribution of Bed Bug Barriers.

58    In order to deal with these allegations by the applicant, I shall have to resolve certain disputed questions of fact. I commence with the controversy regarding the course of the conversation between the applicant, the respondent and Mr Christie on 22 May 2009.

59    As will be apparent from the notes of their recollections set out in the schedule to these reasons, a deal of what the applicant and Mr Christie now claim to have passed on that occasion makes no sense once it is realised that the meeting took place on 22, rather than on 29, May 2009. According to the applicant, the respondent opened the conversation by saying that she thought she would “drop over to have a chat about the bed bug barrier and the charity”. There is no suggestion, even by the applicant, that he and the respondent had discussed her charity at all prior to 22 May 2009. That the respondent should have opened proceedings by saying that she “thought [she] would drop over to have a chat about …” implies that the respondent and the applicant had previously established some kind of discourse on the subject. This could not have been so. Likewise, on 22 May 2009, the applicant could not have responded by informing the respondent that it was “great that you are helping me”, or that “the philanthropic idea is a great way to help other people”. By then, there had been no suggestion that the respondent would help the applicant, and no discussion about the respondent’s philanthropic ideas. The latter had occurred to the respondent only in the bath on 23 May 2009.

60    In the applicant’s notes, he claims that the respondent said to him that he “mentioned the other day some other products that [he was] working on”. Such an observation would have made sense if the meeting had occurred on 29 May 2009, but could not have been said on 22 May 2009. At that time, there was no “other day” previously at which the applicant had mentioned other products to the respondent. According to the notes, relatively early in the exchange the respondent is said to have raised the prospect that she would be able to assist by doing “some work” when she was in France. However, the respondent’s email to the applicant on 27 May 2009 raised, unambiguously for the first time, the idea that she might assist him by “trying France”. According to the applicant’s notes, he said to the respondent: “As I reminded you the other day you do realise this information is strictly confidential information”. There was, however, no previous “other day” upon which any such exchange could have occurred.

61    In each of the respects in which the applicant’s notes of the meeting were clearly wrong, Mr Christie’s notes were also wrong, and in the same way. I must say that both sets of notes have the appearance of having been prepared by reference to the objective evidence provided by the exchanges of emails which came before 29 May 2009. The difficulty is that those exchanges came after the date of the meeting, 22 May 2009. I am driven to find that the notes are little more than artefacts created two years after the event by the applicant. Because he typed up Mr Christie’s handwritten notes, he was in a position to ensure that those notes as typed were consistent with his own. Neither, however, reflected the facts of the matter. I reject both sets of notes as having any evidentiary value whatsoever.

62    I would, however, accept that, at some point before the meeting with Ms Owen on 26 May 2009, the applicant told the respondent of his idea for the use of Teflon in connection with his Bed Bug Barriers. I so find substantially because of the evidence given by the respondent herself, to which I have referred in para 28 above. As I then said, it was consistent with that evidence that the applicant had mentioned the subject on 22 May 2009, but nothing turns on whether it was then, or in the days that followed. That the applicant should at some stage have mentioned Teflon would also have been consistent with what was then occupying his mind. As is apparent from paras 6-11 above, in the period leading up to his meeting with the respondent on 22 May 2009, the applicant had been somewhat preoccupied with obtaining Teflon and non-stick paint materials for the purposes of testing a more advanced version of his device.

63    However, I do not accept that the applicant said anything to the respondent on 22 May 2009 about the Teflon idea being confidential, or involving confidential information. I take the view that the inclusion of that subject in his notes, and in Mr Christie’s notes, was a self-serving attempt to manipulate the evidence that would be presented in this case, and was quite false. Given the applicant’s readiness to conduct his case in this way, I also see no reason why I should accept his evidence, referred to in para 26 above, that he advised the respondent that the information he gave to her about the Teflon idea was “strictly confidential”, on their return from the meeting with Ms Owen on 26 May 2009.

64    The other factual controversy which needs to be resolved relates to the evidence given in the applicant’s affidavit to which I referred in para 11 above. I am obliged to come to this question burdened by the reservations as to the applicant’s credibility with which my consideration of the course of the meeting on 22 May 2009 has left me. It was much in the applicant’s interests to secure a finding from the court that the Teflon proposal which he entertained before meeting the respondent on 22 May was sufficiently developed to amount to concrete information which equity would protect. It was also in his interests to secure a finding that he was then working on an idea that involved passing the bed leg through a piece of sheet Teflon, along the lines of what ultimately became the respondents’ invention. However, the applicant’s own statement in his affidavit was the only evidence that he then had any such idea in mind. He had disposed of the piece of Teflon which he claimed to have obtained in May 2009. Unlike all his other communications with suppliers and others, that by which he is supposed to have obtained the piece of Teflon was supported by no email, no invoice and no other documentation. The very date – “on or around 18 May 2009” – is unvouched by any document, be it paper or electronic.

65    There are good reasons to conclude that the applicant was not working on a “hole-through-Teflon” project as at May 2009. First, even on his own evidence, in September 2009 the applicant was still thinking of a device which was generally in accordance with that which he took to The New Inventors, employing diatomaceous earth in conjunction with Teflon. Secondly, save for the paragraph upon which the applicant relies in his affidavit, there is no suggestion that he took any further steps, or carried out any tests, in relation to a barrier made from a piece of sheet Teflon mounted on the bed leg. That inactivity is hardly consistent with the applicant considering, in May 2009, that he was “on to something great”. Thirdly, the applicant’s energies in the second half of 2009 were directed towards commercialising the production of his glue-based barriers: see para 46 above. That would be an improbable course of events if he had discovered an improved version that would avoid the problems which he then encountered. Fourthly, had the applicant indeed been so enthusiastic about an improved version which used sheet Teflon, he is unlikely to have disposed of the piece which he obtained, at least without first having progressed to further stages of the development of such a product. Fifthly, when told of the respondents’ product in January 2010, the applicant’s first response, by email, was that Teflon was “a different product to mine”. And sixthly, the patent application to which the applicant referred in his affidavit – No 2010202206 – was not made until 31 May 2010, by which time the applicant was well aware of the specifications of the respondents’ product.

66    I do not accept the applicant’s evidence that, on 18 May 2009 or at any time thereabouts, he obtained a piece of sheet Teflon, put a hole in it and placed a bed leg through the hole. I would find that, although he had the idea of incorporating Teflon or a similar substance into his Bed Bug Barrier from about the time this was suggested to him by Mr Doggett in April 2009, it was not until after he became aware of the respondents’ product that he contemplated a design which involved a disc of sheet Teflon as such.

67    The information on which the applicant sues, and which he asserts is confidential to the extent that its further use or dissemination by the respondent will be restrained by equity, is that to which I have referred at para 57 above. Whether equity will so restrain the respondent requires that the applicant “identify with specificity, and not merely in global terms, that which is said to be the information in question” (Smith Kline & French Laboratories (Aust) Ltd v Secretary, Department of Community Services and Health (1990) 22 FCR 73, 87); and then depends upon an affirmative answer being given to three questions, namely, first, whether the information has the necessary quality of confidence about it, secondly, whether the information has been imparted in circumstances importing an obligation of confidence, and thirdly, whether there has been an actual or threatened unauthorised use or disclosure of the information: Corrs Pavey Whiting & Byrne v Collector of Customs (Vic) (1987) 14 FCR 434, 443; Smith Kline 22 FCR at 87; Australian Medic-Care Co Ltd v Hamilton Pharmaceuticals Pty Ltd (2009) 261 ALR 501, 638-639 [632]; RLA Polymers Pty Ltd v Nexus Adhesives Pty Ltd (2011) 280 ALR 125, 135 [42]. In the present case, the third of these requirements will not be problematic for the applicant.

68    To the extent that the applicant did inform the respondent, on or before 26 May 2009, about the use of Teflon as a bed bug barrier, there was little specificity in what he said. Rather, the information – or, more accurately, the idea – which he conveyed to the respondent was so conveyed “in global terms”, to use the language of the Smith Kline. That, by being the recipient of this information from the applicant, the respondent should thereafter be precluded from employing Teflon as a bed bug barrier in any way, and by reference to any design, strikes me as going well beyond the authorities in this area of the law. At the time, the applicant’s ideas about Teflon were undeveloped. Indeed, as mentioned at para 35 above, he was later thinking of using Teflon on the surface of his existing Bed Bug Barrier, in combination with diatomaceous earth. In the present case, he seeks to prevent the respondent from exploiting a particular application of Teflon which had not occurred to himself. He does that by defining the confidential information on which he sues in a global way such as to encompass every form of bed bug barrier made from Teflon which sits on a bed leg. The very broad concept of which he informed the respondent in May 2009 is not such, in my view, as equity will protect.

69    Turning next to the inherent degree to which the applicant’s information, as such, should be regarded as confidential, the cases have referred to a number of indicators by reference to which that inquiry might usefully be progressed. In Dais Studio Pty Ltd v Bullet Creative Pty Ltd (2007) 74 IPR 512, I identified them as follows: (74 IPR at 535 [65]):

Recognising that there is nothing prescriptive in these indicators, I note that reference has been made to the skill and effort that were expended to acquire the information; the extent to which the information was known both inside and outside the employer’s business; the ease or difficulty with which the information could be properly acquired or duplicated by others; the steps taken by the employer jealously to guard the information; the commercial value of the information and the usages and practices of the industry concerned: see Ansell Rubber Co Ltd v Allied Rubber Industries Pty Ltd [1967] VR 37; Mense & Ampere Electrical Manufacturing Co Pty Ltd v Milenkovic [1973] VR 784, 796-798; Secton Pty Ltd v Delawood Pty Ltd (1991) 21 IPR 136, 149; Wright v Gasweld Pty Ltd (1991) 22 NSWLR 317, 334; Del Casale v Artedomus (Aust) Pty Ltd (2007) 165 IR 148, 160.

In Australian Medic-Care, Finn J proffered a similar list: 261 ALR at 639-640 [633].

70    On the evidence in this case, it seems that the advantages of Teflon as a barrier by which the progress of bed bugs might be impeded were well-known within the communities of workers whose business it was to handle these creatures, including Mr Doggett. They had used Teflon, or a similar substance, to prevent bed bugs from escaping from captivity. The use of Teflon as a barrier against the advance of bed bugs on the legs of beds as such was not practised and, in that sense, was not known in the wider community. However, the fact that the idea was given to the applicant by Mr Doggett, rather than originating with the applicant himself, does not assist the applicant’s case. The way the applicant himself came by the information was not as the result of any expenditure of work or effort on his part. If the information did have an inherent quality of confidence about it, it would have done so in Mr Doggett’s hands, and he would surely have disclosed it to the applicant subject to a reservation or condition which reflected that circumstance. Indeed, the ease with which the applicant obtained the information from Mr Doggett suggests that others might have done likewise, and that there would not, therefore, have been any great degree of difficulty attending the obtaining of that information from Mr Doggett or a similarly informed source.

71    Turning finally to the circumstances in which this information, or idea, was imparted by the applicant to the respondent, the findings of fact which I have made above do not support the applicant’s case. Because I have rejected the applicant’s evidence as to the circumstances in which he informed the respondent of his Teflon idea, and found only that, at some time before 26 May 2009, he did so inform the respondent, I could not find, favourably to the applicant, that the idea was imparted in a way that gave rise to an obligation of confidence. I could not find that the idea was imparted other than casually, in the course of a conversation about the matters which were of immediate interest to the applicant and the respondent, namely, the glue-based Bed Bug Barrier. At the time, the relationship between them was not such as would have imposed upon the respondent an obligation of confidence. I reject the suggestion, made in the applicant’s pleading, that the purpose of conveying this information to the respondent was confined to her involvement in his business. That certainly was not the case on 22 May 2009, since it was only late on the night of 23 May that the respondent came up with the idea that the applicant’s invention (not the Teflon idea, as it happened) could be turned to use in a business dedicated to the support of charitable projects. And it was not the case, I would find, on 26 May 2009, notwithstanding that the respondent and the applicant had then been talking to Ms Owen on the general subject of such businesses. I consider that the applicant’s reference to Teflon, either before or after their conversation with Ms Owen, was in the nature of an aside in a conversation which related not to any proposed business venture which they had in mind, but to the applicant’s own other ideas. Indeed, if I were to accept the applicant’s version of this conversation, I would hold that he made it clear to the respondent that nothing which they were discussing with Ms Owen, Mr Gibson and any others with similar involvement had anything to do with his ideas about using Teflon, which lay wholly in the future.

72    I consider that the circumstances in which the applicant made some limited mention of the use of Teflon in bed bug barriers in his conversations with the respondent were not part of such nascent plans as they were then contemplating to market Bed Bug Barriers in a way that would provide funding for charitable projects. I also consider that those conversations never reached anything like the stage at which the applicant and the respondent had decided to carry on business together, whether in the nature of a joint venture, a company or otherwise. Indeed, they appear to have had quite different ideas as to what might be involved. It was the respondent’s ideas which more closely approximated a joint business undertaking. But the applicant never committed himself to that course of action. As the respondent herself discovered, unhappily as she viewed it, the applicant was thinking along the lines of selling his Bed Bug Barriers to her. Having achieved such recent success on The New Inventors program, and (in May 2009 at least) being buoyed with an optimism as to the prospects of his Bed Bug Barrier, the applicant is most unlikely, in my view, to have contemplated giving over the whole of the future business prospects of the invention to the respondent’s organisation. Nothing in the evidence in this case suggests that he ever came close to that point. And certainly nothing suggests that the circumstances in which he informed the respondent of his proposal to use Teflon in future Bed Bug Barriers was such that, because of the nature of the relationship then existing between them, the respondent ought to have received it in confidence, or ought to have understood that it was given in confidence.

73    For the reasons set out above, I reject the applicant’s breach of confidence case.

Trade Practices Act

74    I turn next to the applicant’s claims under the Trade Practices Act. He says that the statements set out in para 51, and one of the statements set out in the quoted passage in para 52 (which I shall identify presently), were misleading and/or false within the meaning of ss 52 and 53(a) and (e) of that Act. I commence with the statements that the respondents’ Teflon product was “half the price” of other products, or “about half the cost” of similar products. Being concerned with price, these statements give rise to issues under s 53(e), as well as the general provisions of s 52, of the Act. The applicant alleges that six of the respondents’ bed bug discs sold for the non-discounted price of $39, or $6.50 each. He alleges that his own Bed Bug Barrier sold for a unit price of $7.50. His pleaded case is, therefore, that it was false and misleading for the respondents to assert that their disc was “half the price of currently available bed bug barriers”, or “about half the cost of similar products”. The respondents’ case was that they had never sold, or offered for sale, their Teflon ring for more than $3.30 per unit, and that the statements made on their web site were, therefore, accurate. They relied upon seven quotations, in the form of invoices, in which the unit price quoted varied from a low of $1.00 to a high of $3.50.

75    Aligning these quotations with the applicant’s pleaded unit price of $7.50 does not, however, satisfactorily address the complaint of false and misleading advertising which the applicant makes. On the same web site as the respondents made their half-price statements, they offered their own product at $39 for a pack of six and at $69 for a pack of nine. It is true that, on the same page of the site, “specials” were offered for these packs at prices of $19.99 and $29.99 respectively, but the falsity, or misleading tendency, of the respondents’ half-price statements should not, in my view, be assessed only by reference to special pricing. The statements were not so limited. Assuming a customer cohort of ordinary intelligence, the message clearly conveyed on the web site, taken as a whole, was that the standard price of the respondents’ product was about half the price of alternative products. That was not the case. The statements were, in my view, at least misleading, but I would go further and find that they were false.

76    The next statement relied upon by the applicant is that “other bed bug barriers are either unsightly or provide a bridge for bed bugs once bugs are caught in the glue”. Here the applicant invokes s 52, and para (a) of s 53, of the Trade Practices Act. The evidence is that, on their web site, the respondents included the following claim in a list under the heading “Why BB Safe Ring?”: “Other bed bug barriers are either unsightly or provide a bridge for bed bugs once bed bugs are caught in the glue”. Literally, this may be read as a statement that every other bed bug barrier is either unsightly or involves the tendency for a bridge to be formed by dead bugs caught in the glue, but not both. In the context of a list of advantages claimed for a product by its distributor, however, I think that the natural reading of the statement is that the problems of unsightliness and ineffectiveness because of such a tendency are generally to be found in other products on the market.

77    The only respect in which the applicant attempted to demonstrate that the respondents’ statement was false or misleading was by reference to his own Bed Bug Barrier. Although the subject was barely mentioned in his submissions, I take it to be part of his case that I should find, as a fact, that his product is not “unsightly”. The respondent did make a submission on the subject, however, as follows:

In the current proceeding, the statement that the Applicant’s product was ‘unsightly’ could fall within ‘permissible limits of denigration’ since the comment is one of value judgement. The fact that a device on the bottom of a bed leg, causing hotel guests, for example, to wonder at the purpose of the device on the legs of the bed they are about to sleep in, could well, in many minds, be considered unsightly, particularly the mind of a hotel owner whose job it is to pre-empt any negative thinking on the part of his/her potential guests.

The reference to “permissible limits of denigration” comes from the judgment of Pincus J in Schindler Lifts Australia Pty Ltd v Debelak (1989) 89 ALR 275, 285. Relevantly to the present point, the question there was whether the statement, which his Honour was, for the sake of analysis, prepared to treat as implicit in something said by the then respondent, that the then applicant was “not very highly regarded” was misleading under s 52. His Honour said (89 ALR at 285):

A claim by a trader that his goods or services are “highly regarded” would ordinarily be taken to be mere puffery. A statement to contrary effect about a rival’s goods should not be held to overstep the permissible limits of denigration, to adapt the language of Walton J in the De Beers’ case. It has to be conceded that a statement by a rival about a trader which is universally acknowledged as pre-eminent in its field that it is “not highly regarded” might be a breach of s 52, as being simply a lie. In my opinion, however, in the circumstances of this case, to treat statements such as that in which the words complained of are contained as within the prohibition in s 52 would be to place unreasonable legal inhibition on ordinary communication in Australian business. I hold that the relevant sentence is not caught by the section.

78    Consideration of the material on the respondents’ web site as a whole reveals what they meant, and what a reasonable reader would have understood they meant, when they described other bed bug barriers as “unsightly”. The respondents described their product as “a small disc that sits above on the legs of a bed between the top of the leg and the bed base”. An illustration was given, from which it appears that the disc would be unobtrusive, and that its presence would not be apparent at all save to someone who went about searching for it. The amount of the disc that would be apparent to the naked eye, even to such a searcher, may be measured from a report provided by Mr Doggett that at least 7.5 mm of Teflon, clear of the circumference of the bed leg, would need to be allowed. When the respondents said that other products were unsightly, I do not think they conveyed the message that the products were aesthetically unpleasing in some absolute sense, but rather that, compared to their own product, those other products would be more visible, and more conspicuously an introduced accessory that may not be part of the bed as such.

79    Considered in this sense, I do not believe that the respondents’ statement about unsightliness was either false or misleading. It was a bit of mild reverse puffery, it had reference to the respondents’ own very minimalist approach and it was not intended, and would not reasonably have been read, as implying a criticism of absolute ugliness. If the applicants’ own product was the comparator, it was not, in my view, inappropriately described as unsightly.

80    If the applicant’s own product was not the comparator, then he has failed to establish his case on the facts. He led no evidence such as would be necessary to sustain the conclusion that there was no other bed bug barrier on the market that could be described as unsightly. If there were even just one, the respondents’ statement would have been neither false nor misleading.

81    Notwithstanding that the second limb of the respondents’ statement (that which referred to bugs being caught in the glue) was expressed disjunctively with the first limb, I consider that it would be quite artificial not to read it as a statement that, in the case of bed bug barriers which operated by reference to a glue trap, bugs would be caught in the glue and inevitably, or most probably, form a bridge. I also consider that the statement was self-evidently a reference to the applicant’s product. On the evidence in the case, he invented that product, and has applied for a patent for it. There is no suggestion of any other product on the Australian market that works by interposing a band of glue, or some similar tacky substance, across the path that the bed bugs would travel. Indeed, in her submissions in the case, the respondent, quite fairly in my view, made no suggestion that the statement was not made in categorical (ie rather than disjunctive) terms or that it did not relate to the applicant’s product. Rather, her case was that there was nothing false or misleading about the statement. She relied upon Mr Doggett’s emails to the applicant of 19 April 2009, and upon Mr Doggett’s oral evidence.

82    The respondent placed a deal of emphasis on the opinion of Mr Meek, reproduced in Mr Doggett’s email to the applicant of 19 April 2009 (see para 8 above). Both Mr Doggett and Mr Meek were apprehensive that, in situations of heavy infestation, a bridge could form. But they did not suggest that the bridge problem had ever actually been encountered in the case of bed bugs. Mr Meek said: “bridge could form”. In his oral evidence in chief, Mr Doggett was asked the following question, and gave the answer set out:

So would you think that it’s possible considering I’m using a polypropylene with a type of repellent glue that it’s possible that my bed bug barriers could fill with bed bugs creating a bridge, then allowing the product not to work? – If there was extreme numbers of bed bugs it would be possible, I suspect, yes. In extreme numbers. Smaller numbers in your more typical infestation I suspect would be unlikely, but again, because there’s no scientific efficacy data to test the claim, then I can’t be 100 per cent definitively sure.

This evidence was barely challenged in cross-examination: the respondent contented herself with having Mr Doggett affirm that the contents of his emails of 19 April 2009 represented his views at that time. As against this, the applicant’s evidence was that he had never had the experience of dead bugs forming a bridge in the glue across which others might pass. Indeed, it appears that he uses a glue which is repellent to bed bugs, which caused Mr Doggett, in his oral evidence, to suppose that the applicant’s system might not be effective to monitor populations of bed bugs, as it would repel them rather than trapping them.

83    Mr Doggett’s emails were appropriately expressed in a context in which the recipient was considering the pros and cons of different methods, but they constituted altogether too tentative an opinion to provide the basis for what the respondents said on their web site. The very clear message in their statement was that bed bugs do get caught in the glue, and that, once that happens, a bridge forms. That was, in my view, misleadingly categorical. The formation of a bridge was no more than a possibility, and even then one which, on the evidence, had not occurred in practice. The statement was made with reference to the applicant’s product, and carried the meaning that the product was of inferior design because bed bugs would inevitably, or at least most probably, become caught in the glue, whereupon the utility of the product for its intended purpose would be compromised. The statement was, on the evidence called in this case, and on the probabilities, both false and misleading. It fell within the prohibitions in ss 52 and 53(a) of the Trade Practices Act.

84    I turn finally to the extract from the respondents’ web site set out in para 52 above. The statement which the applicant alleges was both false and misleading is that the “Protector Bed” mattress encasement, distributed by the respondents, was the “only one found to be 100% effective”. In para 52 above, I have set out the whole of the relevant extract from the web site because, as it seems to me, the context in which the impugned statement was made is important. There were four items which were said to be elements of, or at least extracts from, the Bed Bug Code of Practice. The statement about the mattress encasement was one of them. The Code was not placed into the evidence of either side. Further, the web site “bedbugsalert.com”, said to be the specific reference for the statement, was not placed into evidence. These omissions have significantly compromised the court’s ability to determine whether the statements were false or misleading.

85    The only useful evidence on the present subject was given by Mr Doggett. Although secondary, there was no objection to him giving that evidence. Mr Doggett said that the “Mattress Safe” product, which was the one distributed by the applicant, was a US brand, that it was subjected to scientific testing, and that it was shown to be capable of doing the things that were claimed for it. He said that this product was one of only two mattress protectors recommended in the Code of Practice. Mr Doggett was unaware of the product being distributed by the respondents, and appeared to be of the view that it was not recommended in the Code. The respondents led no evidence at all on the subject.

86    I think the applicant did enough to cast on to the respondents the evidentiary onus of producing the Code of Practice or, relevant extracts from the bedbugsalert.com web site. The evidence of Mr Doggett is sufficient, in my view, to sustain the finding, on the probabilities, that it was misleading to represent that, by reference to the Code, the respondents’ mattress protector was the only one found to be 100% effective. On the evidence as it stands, I would find that the Code contained no basis for such a categorical proposition. Although being recommended in the Code may not be the same as being “100% effective”, there was no suggestion that the Code credited any mattress protector, in terms, with the latter status; certainly not the respondents’. Because of the slight ambiguity on that point of distinction, I would not find that the statement by the respondents was false within the meaning of s 53(a), but I am satisfied that it was misleading within the meaning of s 52.

87    Although, in point of fact, the respondent herself was directly involved in the making of the statements which contravened ss 52 and 53 in the way I have described, the norms of conduct laid down by those sections apply to corporations only. Clearly Iaso was in contravention. It seems that the applicant would have encountered little difficulty in extending that liability to the respondent under s 75B of the Trade Practices Act, but he did not rely on that section. It was not mentioned in his Amended Application, the facts necessary to sustain such liability were not alleged in his Further Amended Statement of Claim, and he made no reference to it in his submissions. It would be wrong, therefore, for me to hold the respondent to be liable under s 75B. Neither, I add for the sake of completeness, did the applicant rely on the Fair Trading Act 1987 (NSW).

88    The route by which the applicant sought to make the respondent liable under the Trade Practices Act involved s 6(3) thereof. His case was that, since the statements complained of were communicated over the Internet, they “involved the use of … telephonic services”. At the level of pleading, that allegation was denied by the respondent. However, in her case as conducted in court, the respondent said nothing on the subject: that case was conducted on the silent premise that ss 52 and 53 applied to her as an individual. Although the matter was not dealt with in the evidence, it has been recognised so often in judgments of the court that the Internet involves the use of telephonic services that I think it would be quite unrealistic, particularly in light of the way the respondent conducted her case, not to proceed by reference to that fact: see, for example, Australian Competition and Consumer Commission v Chen (2003) 201 ALR 40, at [32]; Macquarie Bank Ltd v Seagle [2005] FCA 1239 at [23]; Jones v Australian Competition and Consumer Commission [2010] FCA 481 at [30].

89    The applicant seeks damages or compensation pursuant to s 82 or, if necessary, s 87 of the Trade Practices Act. Under both provisions, the question is whether the applicant suffered loss or damage by conduct in contravention of a provision of Pt V. In the present case, I have found that the respondents engaged in contravening conduct by stating that their disc was about half the price of other bed bug barriers, by stating that the function of the applicant’s barriers was compromised by the tendency for a bridge to be formed over the bodies of dead bed bugs, and by stating that theirs was the only mattress protector found to be 100% effective in the Code of Practice.

90    The applicant claims damages in the sum of $90,000, representing the sales of bed bug barriers which he lost from Mr Pizarro as the result of the latter viewing statements on the respondents’ web site. That this sale was lost as a result of Mr Pizarro viewing those statements there seems little doubt. Mr Pizarro’s change of heart was due partly to his concerns about the quality of the applicant’s product, and partly to his realisation that, however good that product was, it was not the only product on the market. Only the former was linked to the respondents’ contraventions of ss 52 and 53, but that will be sufficient for the applicant’s purposes. So long as the loss and damage sustained by the applicant was “by” the contravention of the respondents, his claim is not defeated by the circumstance that it may at the same time be by some lawful conduct of theirs: I & L Securities Pty Ltd v HTW Valuers (Brisbane) Pty Ltd (2002) 210 CLR 109.

91    The respondent submitted, however, that the loss of Mr Pizarro’s business was not the loss of the applicant at all. It was the loss of his company, Bed Protector, which had not been joined as a party in the proceeding. As mentioned above, the invoice which included $90,000 in sales of bed bug barriers was Bed Protector’s, not the applicant’s. Had that invoice been paid in the normal course, the applicant would not have benefitted. He was, therefore, no worse off for the fact that the sale was lost. When the applicant was under cross-examination, he was confronted with this problem, and he had no answer to it. When asked why his company was not a party, he replied:

That’s a – well, that’s probably a very good legal question to ask. I don’t know. At the time, that was the company that were selling them. You’re right. If that’s the problem.

92    It is tempting to regard this problem as a technical defect in the architecture of the applicant’s case brought about because of his lack of legal representation. However, the Further Amended Statement of Claim, in which the particulars to the applicant’s allegation of damages included a specific reference to the loss of $144,250 from the Landmark Investments order, was prepared by counsel and filed by the applicant’s then solicitors. Notwithstanding the course of cross-examination to which I have referred, no application was made to add Bed Protector as an applicant in the proceeding. In all the circumstances, there is no occasion to take other than a conventional approach to the circumstance that the entity which suffered the loss and damage resulting from the loss of Mr Pizarro’s business was not a party to the proceeding.

93    The applicant has not proved that he suffered loss or damage by the withdrawal of Mr Pizarro’s order or, in relation to that order, by the conduct of the respondents in contravention of ss 52 and 53 of the Trade Practices Act.

94    The other head of the applicant’s damages claim relates to Mr Lyons’ decision to reduce his intended investment in the applicant’s business. Mr Lyons did not give evidence. The only relevant evidence in the case was that of the applicant. According to that evidence, it was not Mr Lyons’ reading of the respondents’ web site that caused him to change his mind: it was the statements made by the respondent on the Today Tonight show. Those statements are not relied upon by the applicant in his case under the Trade Practices Act and, so far as I can see, they were quite benign (see para 50 above). In the result, I would find that the diminution in Mr Lyons’ intended investment did not constitute loss and damage by the respondents’ contravention of ss 52 and 53.

95    It follows that the applicant’s damages case under the Trade Practices Act must be rejected.

96    The applicant also claimed declarations that the respondents’ conduct was in breach of ss 52 and 53 of the Trade Practices Act. Had I upheld his case in damages, I would have required persuading that there was any utility in adding declarations to the orders by which the questions arising in the proceeding were determined. The applicant’s claim for damages has been rejected, but in three respects his allegation of contravening conduct has been upheld. I do not think it would be a satisfactory disposition of the proceeding if the final orders I made were mute with respect to that limited measure of success. I propose to exercise the power arising under s 163A of the Trade Practices Act to make declarations reflecting the findings I have made under ss 52 and 53.

Costs

97    Albeit that the trial was conducted without the benefit of legal representation for either side, both were represented by solicitors at earlier stages of the proceeding. There may be submissions that either would desire to make on the question of costs, and I shall list the proceeding for the purpose of receiving those submissions.

Associate:

Dated:    23 December 2011

schedule

The applicant’s and Mr Christie’s notes of the meeting with the respondent on 22 May 2009