FEDERAL COURT OF AUSTRALIA
QUD 70 of 2020
Date of judgment:
INTELLECTUAL PROPERTY – consideration of an application for an interlocutory injunction
Trade Marks Act 1995 (Cth), s 120
Date of last submissions:
25 May 2020
National Practice Area:
Number of paragraphs:
Counsel for the Respondent:
Solicitor for the Respondent:
DATE OF ORDER:
THE COURT ORDERS THAT:
2. Costs of the application are reserved.
3. The applicant is given leave to file and serve an amended statement of claim by 4 June 2020.
4. The respondent is to file and serve any amended defence by 11 June 2020.
5. The matter is referred to the Registrar for mediation on a date mutually convenient to the parties.
6. The matter is listed for a remote final hearing using Microsoft Teams on Tuesday, 30 June 2020 at 10.15am.
Note: Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules 2011.
1 These proceedings are concerned with an interlocutory application filed on 11 May 2020 in which the applicant, Robert Kenneth Campbell, seeks an order, pending trial, restraining the respondent, Bradley George Sutherland, from using the applicant’s intellectual property. The particular intellectual property is a trade mark registered under the Trade Marks Act 1995 (Cth) (the “Act”). It is Trade Mark No. 1538767 described as “Porkys”.
2 The applicant commenced proceedings on 10 March 2020, in which a range of relief in relation to contended trade mark infringement is claimed. The relief is claimed by reference to s 120 of the Act, and, of course, that section contains at least two primary, and in fact three, possibilities giving rise to trade mark infringement. The short point is that the applicant asserts that the conduct of the respondent falls within s 120 of the Act because the conduct is properly characterised as use of a mark, which is deceptively similar to, or substantially identical with, the registered trade mark in respect of goods or services for which the mark is registered.
3 The affidavit material from Mr Campbell exhibits the trade marks in question and as to the “Porkys” mark, the searches show that it is registered in Class 43 in relation to a reasonably wide range of food-related services and activities. The mark has a priority date of 2 February 2013. Mr Campbell has filed an affidavit in which he exhibits a number of advertisements which appear to have been copied or drawn down from the Facebook page for the business conducted by Mr Sutherland.
4 Mr Sutherland established and commenced operating a business on 19 February 2020, under the name “Porky’s Pizza”. That name appears to be the dominant mark adopted by the respondent, notwithstanding that the business name registration appears to be “Porky’s Pizza HQ”. The mark, “Porky’s Pizza”, as reflected in the Facebook printouts, is Porky’s Pizza. I am willing to proceed on the basis that there is at least a serious question to be tried as to whether or not the mark adopted by the respondent is deceptively similar to the registered mark. It may be that Mr Campbell will seek to assert in the proceeding that the mark adopted by the respondent is substantially identical to the applicant’s trade mark. The precise scope of the true basis upon which the claim will be made needs to be identified clearly in the statement of claim by reference to the material facts in question.
5 The history of the matter shows that Mr Campbell did seek to agitate his concern about the conduct of Mr Sutherland prior to Mr Sutherland commencing the pizza undertaking. It seems clear enough that Mr Campbell sent Facebook message on 15 February 2020, and an emailed letter on 17 February 2020, agitating his position as the registered proprietor of a number of trade marks, but in particular, relevantly for the moment, “Porkys”. It seems to be the accepted position of the respondent that, notwithstanding those communications, the respondent elected to commence the business on 19 February 2020 in the face of those express notifications of a concern by Mr Campbell. That may come back to haunt Mr Sutherland at a later date, depending upon how the proceedings emerge and the findings of fact that are made.
6 It is odd that a party would receive those communications and consciously choose to commence the business using the mark, unless of course he was confident of his position that doing so did not involve any infringement of the applicant’s trade mark. Of course, it may well emerge that Mr Sutherland undertook the steps he took in the firm belief that he was entitled to do what he was doing, possibly by reference to a registered business name, which is often a source of confusion in the minds of citizens in relation to use of trade names and trade marks. In any event, these questions will fall to be decided at a later date.
7 The question for the moment is that there is evidence which is not contradicted, but called into question (although not expressly contradicted), by reference to photographs and other images of displays and other things, which suggests that there are a number of steps to be taken by the respondent, should an interlocutory injunction order be made requiring him to cease use of the trade mark he has adopted. It would be necessary for him to alter the badging, identification, livery, menus and other things, which are said to incur a certain body of costs and it is also said that these costs would be effectively thrown away and may well not be recoverable should the respondent be successful in the proceedings.
8 For present purposes, I must proceed on the footing that the affidavit of Mr Sutherland gives an indication of the detriment or damage or harm that would flow to him should an order be made. On the other hand, Mr Campbell, of course, has a major interest as the registered owner of the trade mark in the trade mark and its integrity. That interest is measured, he says, for the moment, by the possible impact on the “value of the asset”, that is to say, its potential diminution as an asset if an injunction were not to be granted.
9 In the balance between the costs identified by Mr Sutherland and the diminution in the value of the trade mark as an asset, in principle, the balance, it seems to me, falls, as a matter of fairness, on the side of protecting a respondent from the direct monetary costs which would be incurred by the Court’s intervention by an interlocutory injunction. Mr Campbell says that he is willing to give an undertaking as to damages in relation to the interlocutory injunction, and the respondent calls into question the adequacy of that undertaking because the respondent cannot be confident that Mr Campbell could meet the value of the damage that would be incurred in making these changes to the badging, menus and other things.
10 It is true that there is an absence of evidence on the capacity of Mr Campbell to meet such an undertaking, but nevertheless, it is given. It is given unconditionally to the Court, and it is given as the price for obtaining an interlocutory injunction. However, the matter must be decided on the basis of the balance of convenience in the sense of the convenience of where the balance of loss and detriment falls, and in the circumstances, it seems to me appropriate that no order be made, pending the trial of the action, but that the hearing of the matter in a final sense be expedited.
11 The hearing involves two citizens who are individuals and the costs must not be allowed to get out of control. I propose to allocate a date in the first week of July, if possible, to hear the matter finally to decide what orders should be made, and the Registry will notify the parties of that date by the end of the day, if possible. I cannot allocate a date at this very moment.
12 The second thing that should be mentioned is that matters such as these ought to be referred to the District Registrar of the Court in Brisbane for an informal mediation to see whether the parties can reach an accommodation about what is claimed and what is said to be the answer to it. If the position is that there is a serious prospect that Mr Campbell’s trade mark has been infringed, it may be prudent for the respondent to change an aspect of the mark used by him. If the view is that there is a reasonably high threshold of confidence that the mark is not infringed, well then, Mr Campbell might need to look at the scope of his contentions, as well.
13 The proceeding, at the moment, requires some regularity introduced into it. The solicitors for Mr Sutherland have raised some questions in relation to the statement of claim by Mr Campbell. Mr Campbell would need to look at amending his statement of claim to identify precisely the exact examples of what is said to be the infringement, and secondly, why it is said to be infringing. Is it said to be infringing because the use of a mark by the respondent is a use of a sign that is deceptively similar to the registered trade mark, or does it seem to be the use of a sign that is substantially identical with the trade mark? These are important matters because they are at the core of the case. For present purposes, I am going to simply reserve the costs. I am going to dismiss the application for the interlocutory injunction.
14 There will be notification to the parties of the date in the first week of July for a hearing and I will make an order that the matter be referred to mediation by the District Registrar, but I will need to hear the parties, just by email communication to my Associate, about a time which would be a convenient time to take that step. Presumably, a mediation would be best done when Mr Campbell has looked at, and amended, his statement of claim to reflect the precise facts and precise basis for the contended infringement, and thus, when the pleading is put in its final form.