Federal Court of Australia

Hells Angels Motorcycle Corporation (Australia) Pty Limited v Redbubble Limited (No 4) [2022] FCA 190

ORDERS

THE COURT ORDERS THAT:

1.    The parties confer and within seven days provide by email to the associate to Jagot J proposed orders relating to para 66 of the further amended defence reflecting the reasons for judgment published today.

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

REASONS FOR JUDGMENT

JAGOT J:

1    These reasons for judgment concern issues of construction of a contract. The construction issues were the subject of an order for separate determination on 17 December 2021.

2    The contract is a settlement agreement which has an effective date of 24 May 2021. The first respondent, Redbubble Limited, contends that the settlement agreement applies to the dispute between the applicant, Hells Angels Motorcycle Corporation (Australia) Limited (HAMC AU), and Redbubble in respect of examples 1-7 of alleged infringements of HAMC AU’s trade mark rights as claimed in this proceeding. HAMC AU contends that the settlement agreement does not so apply to.

3    For the reasons which follow I have concluded that the settlement agreement does not apply to examples 1-7 of alleged infringements of HAMC AU’s trade mark rights as claimed in this proceeding.

1.    Procedural background

4    HAMC AU commenced this proceeding on 31 December 2020 alleging infringement of its trade mark rights by designs identified as examples 1-7.

5    Greenwood J heard the case on 12-13 July 2021 and reserved judgment.

6    On 8 September 2021 Greenwood J granted HAMC AU leave to re-open to include in its claim examples of other alleged trade mark infringements, examples 8-11.

7    In para 66 of its further amended defence filed 2 December 2021 (following events which need not be identified) Redbubble alleged that HAMC AU’s claims against it in respect of examples 1-7 were answered by the settlement agreement. It is that contention which is the subject of the order for separate determination.

2.    Key facts

8    There were disputes between the parties about which facts were relevant to the proper construction of the settlement agreement. It is necessary to set out some facts to understand the competing contentions of the parties about the settlement agreement.

9    Hells Angels Motorcycle Corporation US (HAMC US) is a company incorporated in California. It owns Australian trade marks nos 526530, 723219, 723463, 1257992 and 1257993. In 2010 HAMC US granted HAMC AU an exclusive non-transferable licence within Australia for use of these trade marks. The trade marks are variously for the words “Hells Angels” and images of skulls wearing a winged helmet.

10    Redbubble controls the website www.redbubble.com. Third parties can upload items for sale to the Redbubble website and customers can buy those items using the website.

11    Redbubble Inc is a US company which is wholly owned by Redbubble.

12    In 2015 HAMC AU commenced a proceeding against Redbubble, as first respondent, and HAMC US, as second respondent, with the consent of HAMC US as the owner of the trade marks, for copyright infringement, trade mark infringement, passing off and misleading or deceptive conduct in respect of items on the Redbubble website (the 2015 proceeding). The claim of trade mark infringement succeeded in part: Hells Angels Motorcycle Corporation (Australia) Pty Limited v Redbubble Limited [2019] FCA 355; (2019) 369 ALR 408.

13    Since October 2017 TP Apparel Inc, a New York limited company established in October 2017, has controlled the website www.teepublic.com. Third parties can upload items and designs for sale and customers can buy those items and designs from the Teepublic website.

14    On 1 August 2018 Ms Oliver of Balmy Law PC, the lawyer for HAMC US, notified “TeePublic” of items on the Teepublic website (www.teepublic.com) alleged to infringe HAMC US’s intellectual property rights. Subsequent communications ensued between Ms Oliver and Mr Boren of Ritholz Levy Fields LLP, the lawyer for Teepublic. These communications between Ms Oliver and Mr Boren continued over a lengthy period and ultimately culminated in the settlement agreement.

15    On 23 October 2018 Redbubble Inc purchased 100% of the equity interests in TP Apparel and TP Apparel Europe Limited, which was established in May 2018 and subsequently dissolved.

16    As noted, on 31 December 2020 HAMC AU brought this proceeding for trade mark infringement against Redbubble as first respondent and HAMC US as second respondent, with the consent of HAMC US as the owner of the trade marks. Examples 1-7 are identified in the amended statement of claim as items sold from the Redbubble website (www.redbubble.com).

3.    Key provisions of the settlement agreement

17    The settlement agreement was signed on behalf of HAMC US on 19 May 2021 and “TP Apparel Corp. dba Teepublic” on 24 May 2021.

18    The settlement agreement states:

This Settlement Agreement, including mutual releases and covenants not to sue (the “Agreement”), is entered into by and between TP Apparel, LLC dba Teepublic and its corporate parent and affiliates (“TP”) on the one hand, and Hells Angels Motorcycle Corporation (“HA”), effective as of the date this Agreement is last executed (the “Effective Date”).

WHEREAS, HA has communicated with TP on multiple occasions regarding complaints that HA has had concerning certain items on Teepublic’s online marketplace located at teepublic.com (the “Marketplace”) that HA claims infringes its rights; and

WHEREAS, TP denies any liability for the allegations raised in these communications; and

WHEREAS, HA and TP (collectively, the “Parties,” and individually, a “Party”) desire to resolve their disputes, including the complaints made in the above-referenced communications (the “Disputes”);

NOW THEREFORE, in consideration of the recitals and mutual undertakings contained in this Agreement, the receipt and adequacy of which are acknowledged, and with the foregoing recitals being incorporated herein, the Parties agree as follows:

1. Mutual Release.

(a)    As of the Effective Date of this Agreement, and subject to complete satisfaction of the payment obligations set forth in Paragraph 2 below, Hells Angels Motorcycle Corporation, on behalf of itself and each of its respective past and present officers, directors, shareholders, employees, servants, agents, partners, members, spouses, offspring, attorneys, insurers and reinsurers, subsidiaries, affiliates, divisions, alter egos, parent corporations, joint venturers, predecessors, successors, licensees, representatives, assigns, trustees, transferees, beneficiaries, heirs, executors, administrators, and all other persons, entities, and corporations acting on its respective behalves (collectively the “HA Releasing Parties”), forever discharge and release TP and each of its respective past and present officers, directors, shareholders, employees, servants, agents, partners, members, spouses, offspring, attorneys, insurers, subsidiaries, affiliates, divisions, alter egos, parent corporations, joint venturers, predecessors, successors, licensees, representatives, assigns, trustees, transferees, beneficiaries, heirs, executors, administrators, fulfillers, vendors, purchasers, users and vendees, and all other persons, entities, and corporations acting on their respective behalves (collectively, the “TP Released Parties”), from any and all actions, claims, debts, costs, expenses, damages, injuries, liabilities, demands, and causes of action at law or in equity of any kind, nature, and description, whether known or unknown, fixed or contingent, matured or unmatured, suspected or unsuspected, asserted or unasserted, that the HA Releasing Parties may have against the TP Released Parties, or any of them, as of the Effective Date, arising from or related to the Disputes or any other matter.

(b) As of the Effective Date of this Agreement, TP Apparel Corp., on behalf of itself and its respective past and present officers, directors, shareholders, employees, servants, agents, partners, members, spouses, offspring, attorneys, insurers, subsidiaries, affiliates, divisions, alter egos, parent corporations, joint venturers, predecessors, successors, licensees, representatives, assigns, trustees, transferees, beneficiaries, heirs, executors, administrators, and all other persons, entities, and corporations acting on their respective behalves (collectively the “TP Releasing Parties”), forever discharge and release HA and each of its respective past and present officers, directors, shareholders, employees, servants, agents, partners, members, spouses, offspring, attorneys, insurers, subsidiaries, affiliates, divisions, alter egos, parent corporations, joint venturers, predecessors, successors, licensees, representatives, assigns, trustees, transferees, beneficiaries, heirs, executors, administrators, and all other persons, entities, and corporations acting on their respective behalves (collectively, the “HA Released Parties”), from any and all actions, claims, debts, costs, expenses, damages, injuries, liabilities, demands, and causes of action at law or in equity of any kind, nature, and description, whether known or unknown, fixed or contingent, matured or unmatured, suspected or unsuspected, asserted or unasserted, that the TP Releasing Parties may have against the HA Released Parties, or any of them, as of the Effective Date, arising from or related to the Disputes or any other matter.

…

(d) Waiver Under Section 1542: The Parties expressly understand and acknowledge that they may have other claims against one or more of the Released Parties that are unknown at the present time. The Parties assume all risks for such claims of every nature, known or unknown, suspected, or unsuspected. The Parties have read and, except as otherwise provided in this Agreement, hereby waive any rights otherwise granted to it under Section 1542 of the Civil Code of the State of California or analogous statutes.

Section 1542 of the Civil Code of the State of California provides:

A general release does not extend to claims that the creditor or releasing party does not know or suspect to exist in his or her favor at the time of executing the release and that, if known by him or her, would have materially affected his or her settlement with the debtor or released party.

2. Payment. Within ten (10) business days after the Effective Date and receipt of the items set forth on Schedule 1 hereto from HA, TP shall pay the sum of one thousand five hundred U.S. Dollars ($1,500.00) to HA (the “Settlement Funds”) in full and final settlement of the Disputes. The Settlement Funds shall be payable by electronic banking transfer according to the banking details set forth on Schedule 1.

3. Proactive Moderation. TP will educate its Content Operations Team (or “Content Team”) regarding the claimed Intellectual Property that HA has identified in its pre-settlement correspondence and Schedule 3 attached hereto. TP will administer proactive moderation activities with respect to the HA Intellectual Property in accordance with the following: TP agrees to search the TP Marketplace at regular intervals (at least once every week) in an effort to locate user-generated content that, in TP’s good faith opinion, falls within the scope of the proactive policing guidelines attached to this Agreement as Schedule 2 hereto, as may be modified from time to time by mutual written consent of the parties (the “Guidelines”). For the avoidance of doubt, TP’s obligations under this Paragraph apply only to the HA Intellectual Property set forth in Schedule 3, as may be updated and provided to TP by HA from time-to-time, and which update (s) have been approved by TP; such approval shall not be unreasonably withheld or delayed. TP is not responsible for monitoring or taking action with respect to any registered, applied for or claimed HA Intellectual Property that is found to be invalid or unenforceable. Should TP locate any user-generated content falling within the scope of the Guidelines, TP agrees to promptly disable access to any content so identified and notify the applicable user that the content has been disabled.

4. Future Unauthorized Use:

(a) If HA becomes aware of any unauthorized uses of the HA Intellectual Property in the TP Marketplace (“Unauthorized Use”), HA, on behalf of itself and its affiliates, agrees, represents and warrants that it shall, as a precondition to asserting any Claim against a TP Released Party, notify TP in writing by contacting TP at both legal@teepublic.com, with a copy to David Boren at dboren@rlfllp.com (or such other person(s) as TP may designate in the future), specifically identifying each Unauthorized Use with a .url to the content’s listing page where the applicable third-party seller has offered various products for sale (the “Listing”), and TP will investigate and promptly remove or disable access to each Listing within three (3) business days, Pacific Time. However, subsequent to the removal, the Parties may subsequently discuss in good faith if a particular Listing should be reinstated because it may be used in a way that does not colorably infringe HA’s rights (a “Permissible Use”).

(b) If HA fails to provide notice pursuant to this Section 4, or if TP removes or disables access to the content within three (3) business days of receiving written notice, HA, on behalf of itself and the HA Releasing Parties, agrees and understands that it may not sue any of the TP Released Parties under intellectual property or unfair competition laws or for any other claim arising out of or resulting from content hosted on the TP Marketplace. Nothing, however, precludes HA from suing under intellectual property, unfair competition, or other claims related to content hosted on the TP Marketplace for which HA has provided notice pursuant to this paragraph and TP does not remove it in accord with this Section 4 and HA does not agree after good faith discussion with TP that it is a Permissible Use.

…

(d) If orders have been placed in connection with listings on the TP Marketplace that include the HA Intellectual Property that are not Permissible Uses and that are identified by HA and removed by TP in accordance with Paragraph 4(a) above, TP shall pay to HA an amount equal to TP’s service fee for each product sold, plus the Seller’s margin on any such transaction(s)….

…

5. No Admission of Liability: The Parties acknowledge and agree that this Agreement represents a compromise settlement of a legal dispute and is not intended to constitute an admission as to any fact or legal claim asserted by HA and is not intended to constitute an admission of liability, wrongdoing or error on the part of any of the Parties or their respective employees, agents, attorneys, representatives, or parent, subsidiary or affiliated companies.

8. Representations and Warranties: Each of the Parties to this Agreement represents and warrants to, and agrees with, each other Party hereto, as follows:

(a) Each Party has received independent legal advice from counsel with respect to the advisability of entering into this Agreement and making the settlement provided for herein. Each Party has executed this Agreement with the consent and the advice of such independent counsel. Prior to the execution of this Agreement, each Party and its legal counsel has had adequate opportunity to make whatever investigation and inquiry they may deem necessary or desirable in connection with the subject matter of the Agreement.

(b) Each Party has carefully read, and knows and understands the contents of, this Agreement. Each Party executes this Agreement without fraud, duress, mistake, or undue influence on the part of anyone, including any other Party to this Agreement. No Party shall be entitled to set aside or rescind this Agreement on the basis of any claim of fraud, duress, mistake, or undue influence.

…

(g) Each person signing this Agreement warrants and represents that, to the extent s/he is executing this Agreement for, and on behalf of, a corporation, company, partnership, association, entity, or affiliate (individually and collectively an “Entity”), s/he has been fully empowered and properly authorized to execute this Agreement for, and on behalf of, said Entity, and is instructed by those having the requisite authority to cause said Entity to make and enter into this Agreement. Each Entity signing this Agreement warrants and represents that, to the extent it is executing this Agreement for, and on behalf of, any other Entity, it has been fully empowered and properly authorized to execute this Agreement for, and on behalf of, said Entity, and instructed by those having the requisite authority to cause said Entity to make and enter into this Agreement.

…

10. Notice: Except as otherwise provided for herein, any notice or other communication under this Agreement will be given in writing and either delivered personally, or by email and overnight delivery by a reputable delivery service such as the US Post Office or Federal Express with delivery tracking, delivery prepaid, to the following addresses:

To TP Apparel, Inc.:

…

To HA

Hells Angels Motorcycle Corporation

…

11. Entire Agreement: This Agreement expresses the entire agreement among the Parties with respect to its subject matter, it supersedes any previous agreement, arrangement or understanding (whether oral or written) between the parties relating to its subject matter, and it may not be changed, supplemented or amended except in writing by the duly authorized representative of the party to be charged.

12. Captions and Headers: The captions and headers of Paragraphs in this Agreement are for convenience only, and do not in any way limit or vary the terms and provisions of this Agreement.

19    Schedule 1 to the settlement agreement (see cl 2) sets out payment details.

20    Schedule 2 to the settlement agreement (see cl 3) sets out “TeePublic Proactive Policing Guidelines” for “Hells Angels Motorcycle Club”, which includes a series of words and designs.

21    Schedule 3 (see cl 3) sets out the Hells Angels Motorcycle Corporation intellectual property. It says:

This Schedule 3 lists the HA-IP as defined in the Agreement to which it is attached. The Hells Angels Motorcycle Corporation is identified below as the “HAWORLD CORP”.

22    The following table consists of a list of “HAWORLD CORP’S” trade marks. The list includes trade marks in the US and other countries including Australia. The trade mark entries for Australia are:

23    As noted, the trade marks the subject of this proceeding are Australian Trade Marks Nos 526530, 723219, 723463, 1257992, and 1257993. Of those, Australian Trade Marks Nos 526530 and 723463 are specifically identified in Schedule 3 to the settlement agreement. Australian Trade Mark No 723219 is a word mark in classes 9, 12, 14, 16, 25 and 26 for the words “Hells Angels” registered in May 2009. Australian Trade Mark No 1257992 is a word mark in classes 9, 14, 16, 25, 26 and 41 for the words “Hells Angels” registered in March 2020. It is the Australian registration based on International Registration No 971196 as identified in Schedule 3. Australian Trade Mark No 1247993 is the Australian registration based on International Registration No 971198 as identified in Schedule 3. It is for the following mark in classes 14, 16, 25, 26, and 41, registered in March 2020:

4.    Principles of construction

24    The parties agreed that although the settlement agreement was made in the United States, as no party adduced evidence of the foreign law that would apply to construction and enforcement of the settlement agreement, it was appropriate to presume that the foreign law would be the same as Australian law: Damberg v Damberg [2001] NSWCA 87; (2001) 52 NSWLR 492 at [119]-[160].

25    While their submissions exposed a difference in emphasis, the parties referred to the same authorities.

26    A convenient summary is to be found in Mount Bruce Mining Pty Limited v Wright Prospecting Pty Limited [2015] HCA 37; (2015) 256 CLR 104 where French CJ, Nettle and Gordon JJ said (excluding footnotes):

[46] The rights and liabilities of parties under a provision of a contract are determined objectively, by reference to its text, context (the entire text of the contract as well as any contract, document or statutory provision referred to in the text of the contract) and purpose.

[47] In determining the meaning of the terms of a commercial contract, it is necessary to ask what a reasonable businessperson would have understood those terms to mean. That enquiry will require consideration of the language used by the parties in the contract, the circumstances addressed by the contract and the commercial purpose or objects to be secured by the contract.

[48] Ordinarily, this process of construction is possible by reference to the contract alone. Indeed, if an expression in a contract is unambiguous or susceptible of only one meaning, evidence of surrounding circumstances (events, circumstances and things external to the contract) cannot be adduced to contradict its plain meaning.

[49] However, sometimes, recourse to events, circumstances and things external to the contract is necessary. It may be necessary in identifying the commercial purpose or objects of the contract where that task is facilitated by an understanding “of the genesis of the transaction, the background, the context [and] the market in which the parties are operating”. It may be necessary in determining the proper construction where there is a constructional choice.

[50] Each of the events, circumstances and things external to the contract to which recourse may be had is objective. What may be referred to are events, circumstances and things external to the contract which are known to the parties or which assist in identifying the purpose or object of the transaction, which may include its history, background and context and the market in which the parties were operating. What is inadmissible is evidence of the parties’ statements and actions reflecting their actual intentions and expectations.

[51] Other principles are relevant in the construction of commercial contracts. Unless a contrary intention is indicated in the contract, a court is entitled to approach the task of giving a commercial contract an interpretation on the assumption “that the parties ... intended to produce a commercial result”. Put another way, a commercial contract should be construed so as to avoid it “making commercial nonsense or working commercial inconvenience”.

27    Another convenient summary in respect of releases is to be found in Playcorp Group of Companies Pty Ltd v Peter Bodum A/S [2010] FCA 23; (2010) 84 IPR 542 where Middleton J said:

[206] The leading authority on the construction of deeds of settlement and releases is Grant v John Grant & Sons Proprietary Limited (1954) 91 CLR 112. In Grant, the majority judgment (Dixon CJ, Fullagar, Kitto and Taylor JJ at 123-4), cited the judgment of Lord Westbury in London and South Western Railway Co v Blackmore (1870) LR 4 HL 610, where his Lordship said (at 623):

The general words in a release are limited always to that thing or those things which were specifically in the contemplation of the parties at the time when the release was given.

[207] Their Honours, having rejected any need to distinguish between equitable and common law construction principles, laid down the following principles for construing a release (at 129-30):

… a releasee must not use the general words of a release as a means of escaping the fulfilment of obligations falling outside the true purpose of the transaction as ascertained from the nature of the instrument and the surrounding circumstances including the state of knowledge of the respective parties concerning the existence, character and extent of the liability in question and the actual intention of the releasor.

[208] Thus, their Honours said (at 131):

The question is whether upon a proper interpretation of the deed the general release clause should be retrained to matters in dispute within the meaning of these recitals. The question depends primarily on the application of the prima facie canon of construction qualifying the general words of a release by reference to particular matters which recitals show to be the occasion of the instrument.

28    The quote from Grant v John Grant & Sons Proprietary Limited (1954) 91 CLR 112 at 131 continued in these terms:

But it is also affected by the general tenor of the deed. It is unnecessary to say more about the canon of construction or to discuss further the contents of the deed. As to the first all that remains is to apply the principle that prima facie the release should be read as confined to the matters forming the subject of the disputes which the deed recites. As to the second, such indications as can be found in the provisions of the deed point rather in the same direction. The detailed character of the terms of settlement, the careful readjustment of rights, the specific reference to the debt of H C Grant and his wife and its discharge and the particularity of the allocation of things and contracts between the companies do not favour the view that a general release was intended going outside the actual area of dispute.

29    In Sarina v Fairfax Media Publications Pty Ltd [2018] FCAFC 190; (2018) 365 ALR 15 Rares, Bromwich and Markovic JJ said:

[20] Where, in a deed (or agreement) a clause provided one party with a release in wide or general words, the common law principle of construction restricted the otherwise wide or general operation of those words by construing the release clause as operating upon only the subject or occasion to which the deed (or agreement) read as a whole referred: Grant 91 CLR at 123-124 per Dixon CJ, Fullagar, Kitto and Taylor JJ. Thus, where, as often occurs, a deed recited that the parties have had a particular dispute, but the clause creating the release did not expressly confine its operation to the dispute mentioned in the recitals, the principles of construction at common law read down the wide words of the release to apply only to the dispute in the recitals. Indeed, Dixon CJ, Fullagar, Kitto and Taylor JJ explained (Grant 91 CLR at 124 and 131) that the common law principle was that a written instrument expressed in general terms (be it a deed or statute) had to be construed having regard to the circumstances to which the instrument must have intended to apply. This in substance accords with the modern principles applicable to the construction of contracts and deeds. As Gleeson CJ, Gummow, Hayne, Callinan and Heydon JJ said in Toll (FGCT) Pty Ltd v Alphapharm Pty Ltd (2004) 219 CLR 165 at 179 [40] (and see also Royal Botanic Gardens and Domain Trust v South Sydney City Council (2002) 240 CLR 45 at 52-53 [10] per Gleeson CJ, Gaudron, McHugh, Gummow and Hayne JJ):

This Court, in Pacific Carriers Ltd v BNP Paribas [(2004) 218 CLR 451], has recently reaffirmed the principle of objectivity by which the rights and liabilities of the parties to a contract are determined. It is not the subjective beliefs or understandings of the parties about their rights and liabilities that govern their contractual relations. What matters is what each party by words and conduct would have led a reasonable person in the position of the other party to believe. References to the common intention of the parties to a contract are to be understood as referring to what a reasonable person would understand by the language in which the parties have expressed their agreement. The meaning of the terms of a contractual document is to be determined by what a reasonable person would have understood them to mean. That, normally, requires consideration not only of the text, but also of the surrounding circumstances known to the parties, and the purpose and object of the transaction [Pacific Carriers Ltd v BNP Paribas (2004) 218 CLR 451 at 461-462 [22]]. (emphasis added)

[21] However, where one of the parties to a release sought to rely upon its wide and general words, equity considered whether it would be unconscientious for that party to enforce such a meaning by examining each party’s actual knowledge and intention at the time of entry into the release: Grant 91 CLR at 124-125. In other words, as Dixon CJ, Fullagar, Kitto and Taylor JJ held (at 129-130), equity will restrain a party seeking to enforce a wide or general release where it would be unconscientious for that party to do so in all of the circumstances. In such a case, the court will examine the knowledge and intention of both releasor and releasee as to the subject matter on which the release would operate.

30    I note that in LCA Marrickville Pty Limited v Swiss Re International SE [2022] FCAFC 17 Derrington and Colvin JJ said:

[57] It is often identified as “trite law” that the duty of a court when construing a document is to discover its meaning by considering it “as a whole”: Australian Broadcasting Commission v Australasian Performing Rights Association Ltd (1973) 129 CLR 99 at 109 per Gibbs J. The rationale is, as Gibbs J observed, that “the meaning of any one part of it may be revealed by other parts” and, as a corollary, “the words of every clause must if possible be construed so as to render them all harmonious one with another”. In Wilkie v Gordian Runoff Ltd (2005) 221 CLR 522 (Wilkie v Gordian Runoff), a majority of the High Court observed that in construing a policy of insurance, as with other instruments, “preference is given to a construction supplying a congruent operation to the various components of the whole”: at 529 [16] citing Project Blue Sky Inc v Australian Broadcasting Authority (1998) 194 CLR 355 at 381 – 382 [69] – [71]. Necessarily, the identification of that construction can only be achieved by ascertaining how a contract or policy might operate as affected by each of the competing interpretations. This “iterative process”, involving “checking each of the rival meanings against the other provisions of the document and investigating its commercial consequences”, “enables a court to assess whether either party’s preferred legal meaning gives rise to a result that is more or less internally consistent and avoids commercial absurdity”: HP Mercantile Pty Ltd v Hartnett [2016] NSWCA 342 [134] quoting Re Sigma Finance Corp [2009] UKSC 2 [12].

[58] In the interpretive process, the concept of reading a document as a whole involves more than merely acquiring an awareness of the surrounding and related provisions. It requires a substantive intellectual process of evaluating the degree of operative coherence and consistency between a proffered construction and the instrument’s other terms. Depending upon the terms of the particular policy it may be that, if giving a broadly worded clause its fullest scope would negate the operative efficacy of a specific clause directed to the issue at the centre of a claim for indemnity, some alternative and narrower meaning may have to be given to the broadly worded one. Whether this involves the application of the maxims generalia specialibus non derogant, generalibus specialia derogant, or the principle that the context requires one clause to be qualified by another does not matter. It is merely part of construing one clause of a document by reference to the others and, as was said by Higgins J in Hume Steel Ltd v Attorney-General (Vic) (1927) 39 CLR 455 at 466, it is a process which is “based on sound common sense and appeals to everyone, layman and lawyer”: cf BMW Australia Ltd v Brewster (2019) 269 CLR 574 at 651 – 652 [206].

…

[60] The importance of reading an agreement as a whole and its provisions in context was recognised by the learned primary judge in this matter who referred to the observations of Lockhart and Hill JJ in Chapmans Ltd v Australian Stock Exchange Ltd (1996) 67 FCR 402, 411 (Chapmans v Australian Stock Exchange) to the effect that:

It is an elementary proposition that a contract will be read as a whole giving weight to all clauses of it, where possible, in an endeavour to give effect to the intention of the parties as reflected in the language which they have used. A court will strain against interpreting a contract so that a particular clause in it is nugatory or ineffective, particularly if a meaning can be given to it consonant with other provisions in a contract. Likewise where there are general provisions in a contract and specific provisions, both will be given effect, the specific provisions being applicable to the circumstances which fall within them.

[61] Her Honour also adopted the reasoning of Leeming JA in Greencapital Aust Pty Ltd v Pasminco Cockle Creek Smelter Pty Ltd [2019] NSWCA 53 [52] where reliance was placed upon the statement of Sackville AJA in Park v Murray Irrigation Ltd [2018] NSWCA 166 [79] that “a conflict between apparently inconsistent provisions is to be resolved on the basis that one provision qualifies the other and, hence, both have meaning and effect”. She also had regard to similar observations of the Victorian Court of Appeal in The Trust Company (Nominees) Ltd v Banksia Securities Ltd (recs and mgrs apptd) (in liq) [2016] VSCA 324 (Banksia Securities) where the Court held (at [46]):

The principle traditionally called generalibus specialia derogant, or its obverse generalia specialibus non derogant, by either of which specific provisions will be given effect in preference to general provisions, or specific provisions are given greater weight than general provisions applying to the same subject matter, has been described as reflecting ‘sound common sense’. On the other hand, when it is open to debate which provision is the more general and which the more specific, the utility of the principle is correspondingly limited. Hoffman LJ made the converse point in William Sindall plc v Cambridgeshire County Council, that the ‘rule is particularly apposite if the effect of general words would otherwise be to nullify what the parties appear to have contemplated as an important element in the transaction’.

(Footnotes omitted).

5.    The competing cases

31    Redbubble submitted that the settlement agreement applies to the dispute about examples 1-7, the subject of this proceeding. Excluding some peripheral matters this was said to be because:

(1)    the settlement agreement is between “TP Apparel, LLC dba Teepublic and its corporate parent and affiliates (‘TP’) on the one hand, and Hells Angels Motorcycle Corporation (‘HA’)”. In this regard, I note that I would interpret “dba” to have the same meaning as “trading as”;

(2)    since October 2018, Redbubble has been the corporate parent and an affiliate of TP Apparel, LLC and, accordingly, Redbubble is a party to the settlement agreement;

(3)    the settlement agreement records that the recitals are “incorporated herein” so the recitals form part of the settlement agreement (contrary to the usual position as identified in Inland Revenue Commissioners v Raphael [1935] AC 96 at 143-144);

(4)    the defined term “TP” in the settlement agreement means “TP Apparel, LLC dba Teepublic and its corporate parent and affiliates”;

(5)    the defined term “HA” in the settlement agreement means HAMC US;

(6)    the recitals include that HA and TP “desire to resolve their disputes, including the complaints made in the above-referenced communications (the ‘Disputes’)”. In this regard, Redbubble stressed that the expressed desire is not confined to the disputes in the “above-mentioned communications” but includes those disputes, meaning that the Disputes as defined must extend beyond those disputes in the above-mentioned communications;

(7)    the recitals also define the “Parties” to mean HA and TP (which incorporates the extended definition of TP as including its corporate parent and affiliates);

(8)    in cl 1(a) the release by HA is on behalf of, relevantly, itself and its licensees who are within the definition “HA Releasing Parties”;

(9)    HAMC AU is a licensee of HA in respect of the Australian trade marks;

(10)    the release by the HA Releasing Parties (which includes HAMC US and HAMC AU) is of TP (defined to include its corporate parent and affiliates) and TP’s affiliates and parent corporations (defined as the TP Released Parties) and is thus a release by HAMC US and HAMC AU of Redbubble as the corporate parent of TP;

(11)    the subject of the release is from any and all actions, claims (etc) of any kind, nature, and description, whether known or unknown, fixed or contingent, matured or unmatured, suspected or unsuspected, asserted or unasserted, that the HA Releasing Parties may have against the TP Released Parties, or any of them, as of the Effective Date, arising from or related to the Disputes or any other matter;

(12)    given that Dispute is defined to include (but is not limited to) the disputes in the “above-referenced communications” and the release is expressed to apply to known or unknown, suspected or unsuspected, asserted or unasserted claims (etc) arising from or related to “any other matter” it must follow that HAMC US and HAMC AU have released Redbubble from the dispute that is the subject of this proceeding insofar as examples 1-7 are concerned which was a known and asserted claim as at the effective date of the settlement agreement;

(13)    in this proceeding HAMC AU is and was in dispute with Redbubble about examples 1-7 as at the effective date of the settlement agreement. It is also the case that HAMC US is and was in dispute with Redbubble in the same respect. The fact that HAMC US consented to HAMC AU bringing the proceeding as the authorised user of the trade marks and entered a submitting appearance does not negate the fact that HAMC US owns the trade marks and is in dispute with Redbubble about their use; and

(14)    Schedule 3 to the settlement agreement refers to HAMC US’s worldwide trade marks, not just trade marks in the United States, and Schedule 3 includes (in fact, only some of) the Australian trade marks in dispute.

32    Redbubble submitted that equity does not operate so as to prevent Redbubble from relying on the release in the settlement agreement as against both HAMC AU and HAMC US in respect of examples 1-7 in this proceeding as:

(1)    it should be inferred that HAMC US and HAMC AU knew of the corporate relationship between TP Apparel and Redbubble Limited, namely that Redbubble Limited was TP Apparel’s corporate parent given that:

(a)    details of Redbubble’s acquisition of TP Apparel and TP Europe were publicly available at the time of the acquisition and at the time the settlement agreement was being negotiated and finalised; and

(b)    the relationship between Redbubble and TP Apparel was known to HAMC AU through the knowledge of its lawyer in this proceeding by no later than 12 April 2021 (the date of Mr Bolam’s first affidavit, Mr Bolam being HAMC AU’s lawyer in this proceeding);

(2)    it should be inferred that Ms Oliver, HAMC US’s lawyer in respect of the settlement agreement knew about this proceeding as Ms Oliver gave evidence in the 2015 proceeding describing herself as HAMC US’s intellectual property counsel who manages and enforces its intellectual property around the world;

(3)    it should be inferred that HAMC AU was aware of the dispute between HAMC US and TP Apparel as the sole director and secretary of HAMC AU between 29 January 2013 and 7 April 2021, and a director and secretary since 8 April 2021, Mr Nelms, has not given evidence to the contrary and is a member of the board of HAMC US, which voted to approve the settlement agreement on 12 May 2021;

(4)    the conduct of the parties after the entry into the settlement agreement (in particular, discussion between Mr Bolam and Mr Barrett, Redbubble’s lawyer, about the possibility of mediation of this proceeding) is irrelevant; and

(5)    to the extent Redbubble’s intentions at the time of entering the settlement agreement are relevant, the evidence of its intentions is consistent with the broad construction of the settlement agreement it advances.

33    HAMC AU submitted that the settlement agreement does not apply to the dispute about examples 1-7 the subject of this proceeding as:

(1)    the reasonable business person would understand the settlement agreement relates to the complaints the subject of the “above-referenced communications” in respect of the “Teepublic’s online marketplace located at teepublic.com (the ‘Marketplace’)”;

(2)    given the express reference to the “above-referenced communications” in the recitals which are incorporated into the settlement agreement, the reasonable business person would construe the releases in the settlement agreement by reference to those communications;

(3)    HAMC US’s first cease and desist letter would be understood by the reasonable business person to have been directed to 38 items on the www.teepublic.com website;

(4)    HAMC US’s second cease and desist letter would be understood by the reasonable business person to have been directed to the identified 315 new infringing material on the www.teepublic.com website;

(5)    TP Apparel’s response is confined to the items on the www.teepublic.com website;

(6)    the subsequent numerous exchanges relate to the disputes the subject of the two cease and desist letters;

(7)    no communication identifies any corporate parent or affiliate of TP Apparel;

(8)    the reference in cl 1(a) to “any other matter” would be understood by the reasonable business person as a “common attempt to cover every conceivable dispute between HA and TeePublic that is identified in the SA [settlement agreement], the first and second cease and desist letters, the TeePublic response and all communications between the parties limiting the dispute to these documents”;

(9)    under cl 3 of the settlement agreement, the required proactive moderation by TP is limited to the TP Marketplace, which is “Teepublic’s online marketplace located at teepublic.com” as referred to in the recitals; and

(10)    cl 4 of the settlement agreement relating to future unauthorised uses is also confined to the TP Marketplace, which is “Teepublic’s online marketplace located at teepublic.com” as referred to in the recitals.

6.    Consideration

34    Aspects of the submissions of both parties about the construction of the settlement agreement struck me as tenuous.

35    For example, to the extent that either party attempted to rely on evidence of the subjective intentions of people involved or not involved in the negotiation or execution of the settlement agreement, I would reject that evidence as irrelevant to the issue of construction.

36    Redbubble also appeared to suggest that the similarity of the business models used on the Redbubble website and the Teepublic website was relevant to the construction of the settlement agreement. However, this assumes that the Redbubble website forms part of the “commercial purpose or objects to be secured by the contract” (Mount Bruce Mining at [47]) when this is an aspect of the construction issue requiring resolution.

37    HAMC AU posited a “reasonable business person’s” understanding of the meaning of the settlement agreement on the basis that the reasonable business person would scrutinise in detail every communication between HAMC US and TP Apparel leading up to the settlement agreement as if they were an intellectual property lawyer. The communications are relevant because they are referred to in the first recital and the settlement agreement expressly incorporates the recitals, and they are referred to in cl 3 of the settlement agreement. The reasonable business person, however, is not an intellectual property lawyer. The fact that the settlement agreement was drafted by intellectual property lawyers is part of the relevant context of the agreement but this does not mean that the subjective states of mind of Ms Oliver and Mr Boren are relevant or that the reasonable business person is to be conceptualised as a version of Ms Oliver and Mr Boren. The relevant issue remains “what each party by words and conduct would have led a reasonable person in the position of the other party to believe” and “[r]eferences to the common intention of the parties to a contract are to be understood as referring to what a reasonable person would understand by the language in which the parties have expressed their agreement”: Toll (FGCT) Pty Ltd v Alphapharm Pty Ltd [2004] HCA 52; (2004) 219 CLR 165 at [40].

38    The same caution must apply to Redbubble’s repeated insistence on textual literalism. The fact that both parties who executed the deed were legally represented by intellectual property lawyers does not mean that it is to be assumed that these lawyers must have meant what they said when they: (a) identified the Disputes as including but not limited to the “complaints that HA has had concerning certain items on Teepublic’s online marketplace located at teepublic.com (the ‘Marketplace’)”, (b) formulated the releases to apply to the Disputes or any other matter, (c) defined TP as including its corporate parent and affiliates, and (d) formulated the releases as including corporate parents and affiliates (for TP) and licensees (for HAMC US).

39    The problem with this literal approach is that it involves replacing the required objective reasonable person with the posited subjective state of mind of Ms Oliver and Mr Boren or an hypothesised reasonable intellectual property lawyer. Even if this were permissible, the approach is flawed because any hypothesised version of the reasonable intellectual property lawyer would be vested with knowledge of the principles of construction including the principles of construction relating to releases which do not involve giving the words of a release their literal meaning if it extends beyond the subject-matter of the dispute sought to be resolved.

40    Another concern is that Redbubble’s focus on the extended meaning of “TP” in the settlement agreement (as including TP Apparel and its corporate parent and affiliates), the definition of the “Parties” in the third recital, and the breadth of the identified releasers and releases in the mutual releases in cll 1(a) and 1(b) is at the expense of analysis of the meaning of “their disputes, including”, “Disputes”, and “any other matter” as they appear in the third recital and those clauses.

41    It may be accepted that: (a) “TP” as defined includes Redbubble, and that Redbubble is within the scope of “Party” in the settlement agreement, (b) the “Disputes” are “their disputes, including the complaints made in the above-referenced communications”, (c) HAMC US (or HA as it appears in the settlement agreement) gives a release on its own behalf and behalf of its licensees (that is, also on behalf of HAMC AU), (d) the release is of “TP” (as defined), (e) the “TP Released Parties” also includes “parent corporations” and “affiliates” (that is, Redbubble), and (f) the release is of claims (etc) “as of the Effective Date, arising from or related to the Disputes or any other matter”).

42    The questions remains – what is released? HAMC US and HAMC AU only release TP, which extends to Redbubble, for claims (etc) “as of the Effective Date, arising from or related to the Disputes or any other matter”. But what does claims (etc) “as of the Effective Date, arising from or related to the Disputes or any other matter” mean? It is in answering this question that the text, context and purpose of the settlement agreement must be considered. Redbubble’s apparent approach is that in HAMC US and HAMC AU releasing Redbubble from claims arising from or related to “their disputes” other than those in the “complaints made in the above-referenced communications” as referred to in the third recital and “any other matter”, the parties meant precisely what is said, which thereby includes this proceeding to the extent that it involves examples 1-7 (which existed as in dispute as of the “Effective Date”). However, this approach involves: (a) focusing on parts of the text of the settlement agreement in isolation from consideration of the settlement agreement as a whole, (b) disregarding the context of the settlement agreement, and (c) disregarding the purpose of the settlement agreement.

43    In terms of the text, the very breadth of the releases reinforces the necessity of the canon of construction that, prima facie at least, releases are to be construed as concerning the disputes the subject of the deed.

44    For example, HAMC US’s release under cl 1(a) is on its behalf and on behalf of all of its members and their spouses and offspring. The release extends to TP (as expansively defined) and all of its past and present employees and their spouses and offspring. The release, as noted, extends to not only the “Disputes”, but also “any other matter”. Yet could it seriously be contended that a reasonable person would understand these words to involve a release between, say, the spouse or offspring of one member of HAMC US and the spouse or offspring of one employee of TP in respect of a family law dispute between them? Or in respect of a commercial dispute between them unconnected to HAMC US’s intellectual property rights? The obvious answer to these questions is “no” because, contrary to Redbubble’s approach, textual literalism in the case of these releases is inapt.

45    Contrary to Redbubble’s submissions, the representations and warranties in cll 8(a)-(g) do not support textual literalism because they too are to be understood in the context of the proper construction of the settlement agreement. To take cl 8(g) as an example, the represented authority is to execute the settlement agreement as properly construed. Clause 8(g) does not provide any indication that it or other provisions of the settlement agreement are to be read literally divorced from the text of the settlement agreement as a whole, in context, and with regard to the objectively ascertained purposes of the settlement agreement.

46    Once it is accepted that textual literalism is inapt, the need to construe the settlement agreement as a whole, in its proper context, and with regard to its objectively ascertained purpose, is apparent.

47    The other textual indicators of significance include the following matters.

48    The relevant communications in the first recital concern “certain items on Teepublic’s online marketplace located at teepublic.com (the ‘Marketplace’) that HA claims infringes its rights”.

49    In the third recital the “Parties” are said to “desire to resolve their disputes, including the complaints made in the above-referenced communications (the ‘Disputes’)”.

50    Accordingly, the Disputes to be resolved include at least the “certain items on Teepublic’s online marketplace located at teepublic.com (the ‘Marketplace’) that HA claims infringes its rights”.

51    The mutual releases in cll 1(a) and (b) concern “the Disputes or any other matter”.

52    The payment in cl 2 is in full and final settlement of the Disputes only.

53    The agreement in cl 3 is that TP (defined to include its corporate parent) will educate its team “regarding the claimed Intellectual Property that HA has identified in its pre-settlement correspondence and Schedule 3 attached hereto”.

54    The claimed Intellectual Property in Schedule 3 includes US and other trade marks including Australian trade marks.

55    The identified owner of the trade marks in Schedule 3 is HAMC US.

56    The obligation on TP (and its corporate parent) in cl 3 is to proactively moderate “with respect to the HA Intellectual Property in accordance with” the specified requirements.

57    The specified requirements in cl 3 relate solely to the TP Marketplace which is defined in the first recital to mean Teepublic’s online marketplace located at teepublic.com.

58    The specified requirements in cl 3 apply only to the HA Intellectual Property set forth in Schedule 3, as may be updated and provided to TP by HA from time-to-time, and which update or updates have been approved by TP.

59    If TP (which includes TP Apparel and its corporate parent) locates any user-generated content falling within the scope of the Guidelines (being those in Schedule 2 setting out words and designs), then TP is required to disable the content under cl 3. Given TP’s obligations under cl 3 this requirement is confined to user-generated content on the TP Marketplace which is defined in the first recital to mean Teepublic’s online marketplace located at teepublic.com.

60    Accordingly, TP has no obligation under cl 3 to search or to remove any content from any website other than the TP Marketplace, which is defined in the first recital to mean Teepublic’s online marketplace located at teepublic.com. As a corollary of this, it is apparent from cl 3 that, for example, HAMC US could not update TP about HA Intellectual Property appearing on some website other than the TP Marketplace within the meaning of cl 3. Nor would TP be bound by its obligation of reasonableness in cl 3 to give approval to any such update. And nor could TP be required by cl 3 to remove any HA Intellectual Property appearing on some website other than the TP Marketplace.

61    Clause 4(a) is consistent with cl 3 in its application only to the TP Marketplace website. Clause 4 operates on HAMC US becoming aware of “any unauthorized uses of the HA Intellectual Property in the TP Marketplace (‘Unauthorized Use’)”. HAMC US is to notify TP of such Unauthorized Use. If HAMC US so notifies TP, “TP will investigate and promptly remove or disable access to each Listing”. Again, the ambit of the clause is confined to the HAMC US intellectual property on the TP Marketplace website. Clause 4(a) does not have anything to say about any other website, whether it be operated by TP Apparel or its corporate parent. So much is clear from the terms of cll 4(b) and 4(c), which are also confined to the TP Marketplace website.

62    These textual indicators convey to the reasonable person that the subject-matter of the settlement agreement is the TP Marketplace website. They convey to the reasonable person that the parties wished to resolve their dispute about certain items on the TP Marketplace website, which items HAMC US claimed infringed its intellectual property. They convey to the reasonable person that the TP Marketplace website is dynamic so that items on it will change over time. They convey to the reasonable person that the parties have agreed a future regime in cll 3 and 4 for dealing with such items on the TP Marketplace website after the effective date of the settlement agreement. They accordingly also convey to the reasonable person that there may be other items on the TP Marketplace website at the effective date of the settlement agreement of which HAMC US is unaware. It follows that they convey to the reasonable person that, to that extent, HAMC US has also released TP (as defined) given the operation of the regime in cll 3 and 4.

63    On this basis, the reasonable person would understand that the definition of Disputes (“their disputes, including the complaints made in the above-referenced communications”) is not confined to the complaints made in the above-referenced communications but extends to “their disputes” because the parties recognised that it was possible that there were alleged items of HAMC US intellectual property on the TP Marketplace website other than those identified in the “above-referenced communications”. The parties intended that those potentially infringing uses too would be resolved by the settlement agreement. Consistently with this, the reasonable person would also understand that the extension of the releases to claims (etc) “arising from or related to the Disputes or any other matter” could not have been intended by the parties to mean any other matter at large. It can only mean a claim (etc) of any kind, known or unknown, arising from or related in some way to the operation of the TP Marketplace website up to and as at the Effective Date.

64    Given that they are mentioned in the settlement agreement, the complaints in the “above-referenced communications” may be considered. The problem with Redbubble’s approach, again, is that Redbubble fails to recognise that the sole focus of these communications is the operation of the TP Marketplace website. Nothing in the communications involves any other website. The TP Marketplace website, www.teepublic.com, is available generally to third parties to upload their items for sale and customers to purchase such items. It is a worldwide website in the sense that TP Apparel, as its operator, does not generally block access to it from any location in the world. It follows that all of HAMC US’s global intellectual property rights are potentially infringed by the TP Marketplace website, not just its intellectual property rights in the United States. But the sole focus of all of the communications remains the TP Marketplace website, not any other website that TP apparel may operate, let alone any website that TP Apparel’s corporate parent or affiliates may operate.

65    The terms of Ms Oliver’s cease and desist letters support the conclusion that the settlement agreement is concerned solely with the operation of the TP Marketplace website.

66    The first letter, of 1 August 2018, says that “HAMC has identified at least 38 items on your site (www.teepublic.com) that infringe upon HAMC’s intellectual property”. The demand is to “cease and desist from such infringement, take down the Infringing Materials, the URL and all other places where any HAMC intellectual property is stored or cached and comply with the other requirements below”. The “such infringement” is the presence of the items on the TP Marketplace website. The infringing materials are to be taken down from that website. The URL (the uniform resource locator enabling access to the website) to be taken down is the URL for the TP Marketplace website. The “other places” are any other locations where the information on the TP Marketplace website is stored or cached.

67    The “other requirements below” in the 1 August 2018 letter are made after the letter reiterates that HAMC US has trade marks internationally and that it is the unauthorised use “on your site” which is in issue, that site being the TP Marketplace website. The requirements, understood in context, relate only to the TP Marketplace website and no other website.

68    The second letter, of 8 October 2018, also relates solely to the TP Marketplace website. The letter says that HAMC US “has again identified items on your site (www.teepublic.com) that infringe upon HAMC’s intellectual property”. The only website to which any reference is made in the letter is this site. Accordingly, the letter also refers to “TeePublic’s site”, “your site”, and “the TeePublic website”. All demands in the letter are made in respect of the TP Marketplace website.

69    The response from TP Apparel’s lawyers of 22 October 2018 denied the allegations but said that “Teepublic’s intent is to cooperate with your request insofar as removing items from its website and taking steps to prevent the alleged ‘Hells Angels’ marks from appearing on the Teepublic website”. The entirety of the letter concerns the TP Marketplace website.

70    All other communications refer only to the TP Marketplace website. The detailed negotiations in the communications primarily concern how TP should screen items on that website (and that website alone) to identify items potentially infringing HAMC US’s intellectual property rights. All the attachments to emails identifying potentially infringing items include links only to the TP Marketplace website.

71    In this context, it is not to the point that the draft settlement agreement always included the corporate parent of TP Apparel. No doubt the common intention of the parties was to ensure that the release extended to the corporate parent or affiliates of TP Apparel. But the deal being negotiated was concerned solely with the potential infringement of HAMC US’s intellectual property rights around the world by the operation of the TP Marketplace website. To the extent they might have been involved in that operation, TP Apparel, its corporate parent and its affiliates (amongst others) are to be released.

72    Accordingly, the context of the settlement agreement is consistent with its text. The sole focus of the settlement agreement is the TP Marketplace website. The parties intended to settle all claims and potential claims between them, known or unknown but existing as at the effective date of that agreement, in relation to the operation of the TP Marketplace website on the basis that there would be a payment for known past alleged infringements on the TP Marketplace website and an agreed regime to minimise and promptly remove future infringing items from the TP Marketplace website.

73    This also accords with the objectively ascertained purpose of the settlement agreement to resolve past disputes about the operation of the TP Marketplace website and provide an agreed regime for the operation of the TP Marketplace website in the future.

74    As I have said, there is no doubt that the parties intended that the settlement agreement operate on behalf of and as between not only HAMC US and TP Apparel, but also as between HAMC US’s licensees (including HAMC AU) and TP Apparel’s corporate parent and affiliates (including Redbubble). It does not matter if HAMC US was aware or unaware that Redbubble was TP Apparel’s corporate parent. The terms of the settlement agreement in this regard are clear. The relevant point, however, is that the settlement agreement concerns only the operation of the TP Marketplace website. It is the dispute about that website alone which is being settled, not any other website.

75    On this basis the release in cl 1(a) of TP Apparel and Redbubble is a release of each of them by HAMC US and HAMC AU in respect of claims (etc) arising from or related to the Disputes (meaning the complaints made in the above-referenced communications and any other aspect of the operation of the TP Marketplace website which might infringe HAMC US’s intellectual property rights) or any other matter (meaning anything relating to the possible infringement of HAMC US’s intellectual property rights by the operation of the TP Marketplace website). The fact that there is redundancy between the definition of “Disputes” and the reference in the releases to “any other matter” is immaterial. The settlement agreement is characterised by redundancy. For example, “TP” is defined to mean TP Apparel and its corporate parent and affiliates. Yet cl 1(a) refers to TP and its affiliates and parent corporations.

76    It follows that the settlement agreement does not apply to any aspect of the dispute the subject of this proceeding. This proceeding concerns claims of HAMC AU against Redbubble in respect of the operation of the Redbubble website. The settlement agreement says nothing about the operation of the Redbubble website. Examples 1-7 are identified in the amended statement of claim as items on the Redbubble website. Accordingly, para 66 of the further amended defence referring to the settlement agreement is no answer to the claims in the amended statement of claim about examples 1-7.

77    I note that Redbubble also submitted that even if the Court finds that, on the proper construction of the settlement agreement, Redbubble was not released from the claims by HAMC AU (as well as HAMC US), that is by no means fatal to Redbubble’s case as the effect of HAMC US releasing Redbubble from the claims is that such release binds HAMC AU as an authorised user and licensee of HAMC US such that on and from 24 May 2021, HAMC AU had no authority to prosecute those claims. However, HAMC US did not release Redbubble from any of the claims in this proceeding which relate solely to the Redbubble website, not the TP Marketplace website. Accordingly, the submission cannot be accepted.

78    In terms of the questions identified by Redbubble in its written submissions I provide the following answers:

79    Does cl 1(a) of the settlement agreement operate to release Redbubble from HAMC AU’s claims for infringement of examples 1-7?

Answer: No.

80    On its proper construction, does cl 1(a) of the settlement agreement release Redbubble from claims, etc that HAMC US had against it as at 24 May 2021?

Answer: Yes, in respect of the operation of the TP Marketplace website. Otherwise, no.

81    If yes to the question above, do such claims include the allegations of infringement and application for relief in respect of examples 1-7?

Answer: No.

82    If yes to the question above, would that release operate to bind HAMC AU absent s 26(1)(b)(i) of the Trade Marks Act 1995 (Cth)?

Answer: this does not arise.

83    If yes to the question above, does s 26(1)(b)(i) operate so as to give a different answer?

Answer: this does not arise.

84    I consider that the appropriate order would be to dismiss para 66 of the further amended defence with Redbubble to pay HAMC AU’s costs of and in connection with the hearing on 15 February 2022, but will give the parties seven days to confer and agree or disagree about proposed orders.

Associate:

Dated:    8 March 2022