Federal Court of Australia

Hells Angels Motorcycle Corporation (Australia) Pty Limited v Redbubble Ltd (No 5) [2022] FCA 837

ORDERS

THE COURT DECLARES THAT:

1.    The use by Redbubble Ltd (“Redbubble”) of the sign “Hells Angels” as depicted in Examples 1, 2, 3, 5, 6 and 7 of Attachment C to the reasons for judgment (the “reasons”) published today and as depicted in Examples 8, 9, 10 and 11 of Attachment D to the reasons published today, constitutes infringing use of such signs for the purposes of s 120(1) of the Trade Marks Act 1995 (Cth) (the “Act”), of the relevant trade marks in suit in the proceeding relevant to that sign.

2.    The use by Redbubble of the sign consisting of a device or design described as the side or profile view of the winged death head (the “device”) as depicted in Examples 1, 3, 4, 5, 6 and 7 of Attachment C to the reasons and as depicted in Examples 8, 9, 10 and 11 of Attachment D to the reasons, constitutes infringing use of the device for the purposes of s 120(1) of the Act, of the relevant trade marks in suit in the proceeding relevant to the device.

THE COURT ORDERS THAT:

1.    Redbubble is restrained whether by itself, its officers, servants or agents or otherwise howsoever, from using the sign “Hells Angels” as depicted in Examples 1, 2, 3, 5, 6 and 7 of Attachment C to the reasons and as depicted in Examples 8, 9, 10 and 11 of Attachment D to the reasons, or any sign substantially identical with, or deceptively similar to, a sign bearing the words “Hells Angels”, on the website operated by Redbubble in relation to trade in goods to which the sign can be applied, where such goods are goods in respect of which Trade Mark No. 526530, Trade Mark No. 723219 and Trade Mark No. 1257992 is registered.

2.    Redbubble is restrained whether by itself, its officers, servants or agents or otherwise howsoever, from using the sign being the device described in Declaration 2 of these declarations and orders as depicted in Examples 1, 3, 4, 5, 6 and 7 of Attachment C to the reasons and as depicted in Examples 8, 9, 10 and 11 of Attachment D to the reasons, or any sign substantially identical with, or deceptively similar to, a sign consisting of the device, on the website operated by Redbubble in relation to trade in goods to which the sign can be applied, where such goods are goods in respect of which Trade Mark No. 526530, Trade Mark No. 723463 and Trade Mark No. 1257993 is registered.

3.    Redbubble pay damages to the applicant pursuant to s 126 of the Act in an amount of $78,250.

4.    Redbubble pay the costs of the applicant of and incidental to the proceeding.

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

REASONS FOR JUDGMENT

GREENWOOD J:

1    These proceedings are concerned with the question of whether the first respondent, Redbubble Ltd (“Redbubble”) infringed the trade marks, registered in Australia under the provisions of the Trade Marks Act 1995 (Cth) (the “Act”), of the second respondent, Hells Angels Motor Cycle Corporation (a United States Corporation, “HAMC US”), having regard to seven examples of conduct at various times in 2020 (mostly in October 2020), by using, as a trade mark, a sign substantially identical with, or deceptively similar to, one or more of HAMC US’s registered trade marks, for the purposes of s 120(1) of the Act.

2    The matters in controversy relevant to that question were the subject of a hearing on 12 July and 13 July 2021. Judgment was reserved on 13 July 2021.

3    The applicant, Hells Angels Motorcycle Corporation (Australia) Pty Limited (“HAMC AU”) is an authorised user under the Act of each of the trade marks in suit.

4    In late August and early September 2021, the applicant sought to agitate with the Court its concern that four further examples of contended infringing conduct by Redbubble had been identified: Examples 8, 9, 10 and 11. The conduct is said to have occurred in August 2021. The applicant sought to rely upon these additional examples of contended infringement as a further basis for relief (being relief claimed in respect of all 11 examples) in the form of declarations as to infringing conduct, injunctions under s 126(1)(a) of the Act, damages under s 126(1)(b) of the Act and additional damages under s 126(2) of the Act.

5    On 8 September 2021, leave was granted to the applicant to re-open its case to include Examples 8, 9, 10 and 11 being the subject of the matters set out in an affidavit of Mr Hansen sworn 21 August 2021. Leave to re-open the case was not opposed by Redbubble.

6    On 8 September 2021, a number of programming orders were made which provided for amendments to be made to the originating application, the statement of claim, the defence by Redbubble and other consequential matters in order to enable a hearing to take place so as to determine whether Examples 8, 9, 10 and 11 involved infringing conduct on the part of Redbubble and, if so, the nature and scope of the remedies to be granted in relation to that conduct.

7    Redbubble, apart from amending its defence to address specifically the matters of fact and law raised by the pleading of Examples 8, 9, 10 and 11, also sought to amend its defence to plead a particular settlement agreement between HAMC US and an entity described as “TP Apparel Inc” which had an effective date of 24 May 2021. Redbubble Inc had acquired all of the equity interests in TP Apparel and a related entity and the contention was that the terms of the settlement agreement had the effect of also settling all issues in controversy in these proceedings as to Examples 1 to 7.

8    The question of whether the settlement agreement had the effect of compromising the matters in issue between the parties in these proceedings as to Examples 1 to 7 was the subject of a separate question which was determined by Jagot J in Hells Angels Motorcycle Corporation (Australia) Pty Limited v Redbubble Limited (No 4) [2022] FCA 190. That question was determined adversely to Redbubble. There being no utility in multiple appeals, orders were made extending the time within which an appeal might be filed from the orders and judgment of Jagot J to a period within 28 days of the date of publication of final orders on the substantive matters in issue in the proceeding.

9    That matter having been determined, hearing dates were allocated for the determination of the issues alive in the re-opened case.

10    The further hearing took place on 7 April and 8 April 2022.

11    These proceedings in relation to Examples 1 to 11 are not the first occasion on which the present parties have been in controversy on a range of intellectual property questions. The applicant previously brought proceedings against Redbubble in which it asserted infringement of the trade marks in suit in these proceedings. The applicant also asserted in the earlier proceedings infringement of copyright in particular works and relief in respect of some consumer questions. The applicant was unsuccessful as to those latter matters but was successful in respect of particular trade mark infringements mentioned shortly.

12    The trade marks in suit in the earlier proceeding and in this proceeding are set out as Attachment “A” to these reasons. The attachment identifies the trade marks in suit and the goods in respect of which each mark is registered.

13    Although it will be necessary to have regard to aspects of the judgment in the earlier proceeding and, in particular, in relation to the examination of the Redbubble business model and the protocols governing proactive moderation of Redbubble’s website, it is sufficient for present purposes to note that the applicant established infringements of its trade marks in respect of three examples (Examples 1, 3 and 4 in the earlier suit) arising out of the offering for sale and supply of goods the subject of the trade mark registrations by reference to the “signs” then in issue in that proceeding: Hells Angels Motorcycle Corporation (Australia) Pty Limited v Redbubble Limited [2019] FCA 355 (the “2019 judgment).

14    Judgment was given in that matter on 15 March 2019. Examples 1, 3 and 4 from the earlier proceeding are set out as Attachment “B” to these reasons. The final orders in that proceeding included an injunction restraining Redbubble from infringing the applicant’s trade marks, in particular terms, and an award of damages of $5,000 and an order for costs.

15    As to the seven examples relied upon by the applicant in this proceeding, colour copies of each of the seven examples are Attachment “C” to these reasons. In this proceeding, the applicant contends that Redbubble has infringed and is continuing to infringe the trade marks in suit and that it threatens, intends and will, unless restrained, continue to engage in infringing conduct. The applicant says that Redbubble has profited from the infringing conduct. It says that it has sustained loss and damage by reason of the infringing conduct and will continue to suffer damage unless Redbubble is restrained. It seeks additional damages based on the number of infringements and the circumstance that it was successful against Redbubble in the earlier proceedings. It contends that Redbubble has not taken proper steps to recognise and protect the interests of the applicant in terms of the applicant’s rights under the Act. Redbubble contests each of these propositions.

16    As to Examples 8, 9, 10 and 11, Exhibit 2 in the proceeding illustrates the images and/or words (or both) uploaded to the Redbubble website which, having regard to the evidence of Mr Hansen, is said to have given rise to infringing conduct in respect of those examples. Exhibit 2 is Attachment D to these reasons.

17    Because the proceeding was re-opened, the trial of the proceeding necessarily became bifurcated.

18    I propose to examine the state of the evidence and the contentions as they emerged at the conclusion of the first part of the hearing dealing with Examples 1 to 7 and then address the state of the evidence in relation to Examples 8, 9, 10 and 11 and the extent to which evidence adduced in the resumed hearing bears on questions in issue in relation to Examples 1 to 7.

19    Although it will be necessary to examine the evidence of Mr Hansen, it is sufficient to note for present purposes that the applicant’s claim is based upon the appearance on Redbubble’s website of the seven uploaded words and images referred to in the pleadings as earlier mentioned and depicted in the attachments. It is also sufficient to note for present purposes that the evidence shows that Mr Hansen, the applicant’s trade mark officer, ordered goods to which the relevant images could be applied for purchase, sale, payment and delivery, through Redbubble’s website consistent with its functionality and business model described in the 2019 judgment and affirmed in evidence in these proceedings. It is sufficient to note for present purposes that Mr Hansen ordered coasters, a canvas-mounted print, an acrylic block, a sticker, t-shirts and facemasks.

20    Redbubble makes a preliminary point in relation to the trade marks in suit and observes that it has now emerged, since the previous proceeding, that particular assignments were required to be lodged to, in effect, regularise the state of the Trade Mark Register and that at the time of the previous proceeding, HAMC US was actually not the registered owner of two of the trade marks at that time. That point is developed with a little more force in later submissions coupled with the proposition that the untidy or inappropriate state of the Register reflects badly upon both the applicant and HAMC US.

21    As to the trade marks, Redbubble accepts that having regard to the registrations and the articles or goods in issue as purchased by Mr Hansen, the fact that there are different registrations is “largely immaterial”. Redbubble accepts that to the extent that the coasters, canvas-mounted print, acrylic block and stickers have on them the words “Hells Angels” (or a sign substantially identical with, or deceptively similar to, those words), use of such a sign will infringe Trade Marks 723219 and 1257992 in Class 16. To the extent that those goods have a “winged skull device” or a sign substantially identical with, or susceptibly similar to that device, infringements will arise in relation to Trade Marks 723463 and 1257993. Redbubble accepts that the same position applies for t-shirts in Class 25.

22    Example 2 is a facemask with the words “hell’s angel”. Example 4 is a sticker with a winged skull device. Redbubble accepts that each of Examples 1, 3 and 5 to 7 had at least the words “Hells Angels” and a winged skull device on them.

23    Redbubble accepts (and pleads), for the purposes of this proceeding only, that each of Examples 1 to 7 bear a sign that is “substantially identical with or deceptively similar to the Trade Marks” in suit.

24    In the applicant’s submissions, emphasis is placed upon the finding of infringement in the 2019 proceeding in relation to the example described as “Hells Angels Virginia”. That particular example was Example 1 in the previous proceeding and it can be seen as Example 1 in Attachment B to these reasons. The point of the emphasis attached to this example from the 2019 proceeding is the contention that any person looking at, for example, the coasters in Example 1 of the seven examples in issue in the first part of this proceeding, or looking at the canvas-mounted print or the t-shirt or the acrylic block in Example 1, would see the words “Hells Angels” in what is called the “upper rocker”, and would see the winged skull device, in strikingly identical terms to the so-called upper rocker and device depicted in Example 1 of the 2019 judgment. The same proposition is said to emerge in relation to the facemask and classic t-shirt forming part of Example 3, the sticker and classic t-shirt forming part of Example 4, the classic t-shirt, facemask and sticker of Example 5, the sticker and classic t-shirt of Example 6 and the classic t-shirt and poster of Example 7. The applicant contends that it is a material matter to keep in mind that in circumstances where a finding of infringement was made in the 2019 judgment of 15 March 2019 on the basis of the elements apparent in Example 1 in the 2019 proceeding, the applicant would not expect to find in May, October and November 2020 in Examples 1 to 7, features of words and a device in substantially identical terms (or for that matter, in deceptively similar terms) to the features in Example 1 in the 2019 judgment giving rise to a conclusion of infringement. The applicant’s proposition is that Redbubble might be expected to have taken steps to ensure that further examples of that kind would not emerge in Redbubble’s transactional conduct, through its website, exhibiting the same particular features the subject of the previous finding and order. There are a number of considerations relevant to the question of detection, identification of uploaded works and proactive moderation which go to that matter. They are discussed later in these reasons.

25    Redbubble observes that the comparison emphasised by the applicant is irrelevant for trade mark purposes. It is undoubtedly true that the question to be answered in reaching a conclusion about infringement in all the relevant circumstances of the particular case is a comparison between the trade mark as registered and the impugned sign.

26    However, it remains accurate to say that the exact words and the exact device (but for the geographic description adopted in the so-called “lower rocker”, in that case “Virginia”) as found in the infringing article in Example 1 from the 2019 judgment appear in Examples 1, 3, 4, 5, 6 and 7 in suit in this proceeding.

27    Redbubble accepts that the impugned images the subject of the seven examples in suit appeared on its website. Redbubble also accepts that the website and its associated activities continue to operate substantially as they did, as found in the 2019 judgment, and as described at [2]-[5], [164]-[169] and [198]-[247] of the 2019 judgment.

28    It is not necessary in these reasons to quote those paragraphs. However, those paragraphs should be read in conjunction with these reasons. Those paragraphs are Attachment “E” to these reasons.

29    Redbubble observes that, in general, any changes to the method of operation of the website represents an overall increase in the automation of particular functions and the “constant improvement of processes designed to discourage, prevent and penalise infringements and contraventions of IP rights”.

30    Mr James Toy is the assistant general counsel for the Redbubble group of companies including the applicant. Mr Toy has given extensive evidence about the operation of the website and steps taken by Redbubble to improve measures to discourage and prevent infringements of the intellectual property rights of others. In particular, he identifies a range of matters at para 71(a) to (h) of his affidavit of 13 May 2021 as a summary, in part, of the earlier paragraphs of that affidavit describing those matters. I will return to those matters later in these reasons.

31    In the 2019 judgment, the Court examined the operation and functionality of the Redbubble website. I understand that apart from evidence about contended improvements to that method, Redbubble accepts that the description of the functionality of the website remains entirely correct at the date of these proceedings. That proposition is consistent with Mr Toy’s evidence subject to the matters mentioned above. In the 2019 judgment, the Court came to a view about conduct characterised as infringing conduct on the part of Redbubble by reference to particular examples in the context of the analysis of the functionality of the website and the business model adopted by Redbubble to further its business interests.

32    Redbubble, in its submissions, identifies a number of paragraphs from the 2019 judgment which reflect, in part, that analysis, and it then postulates a formulation of what would amount to infringement having regard to the analysis in the 2019 judgment. The following paragraphs from the 2019 judgment can usefully be set out here in that context. The opening paragraph ([456]) returns to the device and words at Example 1 in suit in the earlier proceeding:

456    The image at Example 1 contains the words “Hells Angels” with the addition of the device of the side view of the Death Head. I am satisfied that the image engages a “use” of the identical Trade Marks 723219 and 1257992 with an addition, and the addition, in any event, is the device represented by Trade Marks 723463 and 1257993. Thus, the use is use of a sign substantially identical with those registered trade marks. I am also satisfied that it is use “in relation to” goods (clothing) in respect of which each trade mark is registered.

457    Whose use is it? Is it use by Redbubble? If so, is it use, as a trade mark, by Redbubble, that is, use as a badge of origin of the goods for which the marks are registered, or services “closely related” to the “registered goods”, in the sense contemplated by s 120(2)(b) of the Trade Marks Act? Is it use “in Australia”?

458    Redbubble says that an artist, De Ann Troen, has acted, in Virginia, to upload the image at Example 1 to the website. The “work” of the artist is offered by her for application to goods, including clothing. The purchase by Mr Hansen concerned application of the work to a T-shirt. There is, no doubt, that Ms Troen was, by uploading the work, seeking to engage consumers, commercially, (that is, in trade) with the commercially attractive force of the recognised name and image (the side view Death Head) of Hells Angels. That livery is the subject, as a matter of law, of the registered word marks and registered device marks of the Hells Angels special purpose vehicle, HAMC US.

459    I accept that Ms Troen is using the registered trade marks (as earlier identified) as a trade mark in the sense of a badge of origin of her work and inviting consumers to apply the work in physical relation to goods for which the relevant marks are registered.

460    As to Redbubble, that company is “in the business” of facilitating the supply of products bearing the uploaded image of Ms Troen (in this example) or, put another way, Redbubble is in the business of facilitating the supply of clothing bearing, put simply, the registered trade marks of HAMC US (in this example). Redbubble is not the “seller” of artwork. However, it is the supplier, in the sense that it is responsible for all of the transactional supply-side elements of a transaction for the supply of goods bearing the applied works.

461    Redbubble has created a business model designed to enable users, in Australia (and, for that matter users in all jurisdictions in which the website is accessible), to find images through the website comprised of, in this example, Ms Troen’s image made up of the identified trade marks of HAMC US. Redbubble enables images containing the relevant trade marks to be presented to buyers of particular goods (nominated by the artists from the website categories of those goods to which the work can be applied) expressly for the purpose of facilitating the supply of goods (clothing, in this example) to which the marks are applied. It does so by and through the functions and protocols of the website engaged by Mr Hansen (and other potential viewers of the image), in Australia.

462    Redbubble is the supplier of the goods (clothing) bearing the trade marks because it enables the sale and purchase transaction, confirms the order, takes payment, receives revenue for itself and facilitates revenue payable to the artist, instructs the fulfiller, arranges delivery and places its own name and logo on the goods in the form of swing tags as part of its set of procedures for the supply of the goods. The artist makes the work available for selection by consumers for application to selected goods. Redbubble is directly engaged in all facets of the transaction for the supply of goods bearing the works, to the consumer. That is the way the Redbubble business model works, and the way that it is designed to work.

…

465    It seems to me that in that sense, Redbubble is also “using” the trade marks, in Australia, within its own business model, to generate revenue from the supply of goods (clothing) bearing marks or signs substantially identical with the relevant registered trade marks as earlier identified. Redbubble is using the relevant registered HAMC US trade marks for the purpose of indicating, or so as to indicate, a connection in the course of its trade between clothing bearing the marks, and Redbubble, as a source of supply of those goods.

466    Moreover, Redbubble, as an aspect of the indicia of the depth of Redbubble’s engagement in the supply-side set of steps relating to goods bearing the relevant image, has registered its own name as a trade mark in Class 25 of Schedule 1 to the Regulations for some items of clothing and the Redbubble name and logo are registered in many classes of goods. At [172] of these reasons, the field of goods and services of Redbubble’s registrations is set out. These “goods registrations” suggest that Redbubble necessarily sees itself as using, or intending to use, its word mark and logo so as to distinguish “goods” (so far as the goods classes are concerned) dealt with or provided, in the course of its trade, from goods so dealt with “by any other person”: s 17 of the Trade Marks Act.

467    Redbubble also says that it provides: printing services (T-shirt printing, textile printing, photographic printing (Class 40)); clothing and fashion design services (Class 42); clothing design services (Class 42); and business services to facilitate creative expression (Class 35). The services of T-shirt printing, textile printing and business services to facilitate creative expression, seem to be services, having regard to the elements of the Redbubble business model deployed by Redbubble, falling within the description of services “closely related” to “registered goods”, that is, goods in respect of which the HAMC US trade marks relevant to Example 1 are registered.

468    I am satisfied that Redbubble is “using” the HAMC US registered trade marks relevant to Example 1, within its own business and revenue model, in the course of its supply-side transactional trade effected through the Redbubble website, in relation to the supply of goods (T-shirts) bearing the marks, in respect of which the HAMC US trade marks, relevant to Example 1, are registered. Redbubble is, in that sense, “using” the HAMC US registered trade marks as a badge of origin of supply and distribution within its trading activity as the source or origin of supply of goods bearing those particular marks. In other words, put simply, Redbubble is saying, by its business model, in effect: “If you come to Redbubble you can get this T-shirt online from us bearing the Hells Angels trade marks”.

469    The capacity to engage, in Australia, through the website, as Mr Hansen did, constitutes use in Australia by Redbubble.

33    Redbubble observes that it did not challenge, by appeal, any aspect of the 2019 judgment.

34    Redbubble accepts, in these proceedings, that where a website hosted on a server located anywhere in the world is accessible from Australia on which an image (device or text or both) is displayed which can be searched for by keyword search terms and from which goods can be ordered bearing the image/device/text (the subject of which, for example, might be a registered trade mark in Australia), a trader operating such a website will infringe an Australian registered trade mark if the image or device so applied to the relevant goods is substantially identical with, or deceptively similar to, the Australian registered trade mark; and, the goods to which the impugned device or sign is applied are goods falling within the registration for the trade mark; and, the trader’s system (in this case, through the particular functionality of the website), arranges for the production and dispatch of the goods so ordered.

35    Apart from these accepted integers of infringement, Redbubble says that it would add the qualifying “rider”, “unless the image was placed on the website by, or with the authority (express, implied or ostensible) of the trade mark owner”.

36    Redbubble also contends and thus accepts that the following matters of principle can be isolated from the 2019 judgment:

[I]nfringement will still be made out:

•    even if the images are placed on the website by third parties,

•    including if those third parties are outside Australia,

•    in breach of their agreement with the website owner,

•    even if the entire process – from uploading through searching by the customer through ordering the goods from a manufacturer and their dispatch to the customer – is entirely automated;

•    even if the manufacturer of the goods is in a place other than Australia (or any other place where Redbubble has any presence); and

•    regardless of whether any goods are actually ordered.

37    In the 2019 judgment, the Court reached a conclusion about infringement having regard to the findings of fact concerning the method of operation of the Redbubble website and all of the features of the business model reflected in that modality and the application of the law to the facts as found. The Court concluded that Redbubble had engaged in infringing conduct as to Examples 1, 3 and 4. Although matters of principle might usefully be distilled from the reasoning in the 2019 judgment, it should be remembered that the analysis in that proceeding was necessarily a fact-intensive one having regard to the very particular methodology adopted by Redbubble in the conduct and operation of its website and business model deployed through the website. It is sufficient to note for present purposes that so far as this proceeding is concerned, nothing about the conduct and operation of the website and the elements of the transactional business model deployed by operation of that website has changed. As mentioned earlier, Mr Toy and others describe measures adopted by Redbubble to enhance detection and protection of the rights of others, which are described later in these reasons.

38    Having regard to Redbubble’s analysis described at [32] to [36] of these reasons (and the quoted paragraphs), Redbubble admits infringement of HAMC US’s trade marks in suit in the case of the seven examples in issue by reason of the appearance on the website of the substantially identical or deceptively similar signs, in the context of the functionality of the website. That admission is subject to the pleading. By its amended defence, Redbubble denies at para 44 that the conduct (otherwise said to constitute the infringing conduct) was engaged in without the licence or authority of HAMC US or the applicant, and says that in so far as any pleaded conduct of Redbubble was “prompted by” Mr Hansen, Ms Lyhne or any person “interacting” with the Redbubble website “with the authority” (actual implied or ostensible) of the applicant or HAMC US, the otherwise infringing conduct was “licensed, authorised or otherwise permitted” by the applicant or HAMC US, and is thus non-infringing conduct.

39    Thus, Redbubble says that to the extent that the applicant or HAMC US (or both) has caused Mr Hansen to engage with the Redbubble website and to cause the trap transactions to occur, Redbubble’s impugned conduct has occurred expressly with the authority of the rights owner and cannot constitute infringing conduct, as the very essence of infringement is engaging in conduct falling within s 120(1) of the Act without the licence or authority of the trade mark owner.

40    As to trap purchases, the very essence of a trap purchase is to identify by reference to objectively verifiable events and documents, probative evidence of whether a person is engaging in the conduct of using, as a trade mark, a sign that is substantially identical with, or deceptively similar to, the trade mark in suit, in relation to goods or services in respect of which the trade mark is registered. The point of any trap purchase is to put a rights’ owner in a position to be able to say to a court exercising the relevant jurisdiction: “This is what the respondent is doing”. Often, there is no other immediate disciplined, accurate and precisely documented probative way of demonstrating that a respondent is transgressing, in the statutory sense contemplated by s 120(1) of the Act, upon the exclusive rights of the trade mark owner or the rights enjoyed under the Act by an authorised user. The trap purchase normally occurs with the express or implied authority of the trade mark owner (or authorised user) because those parties have the relevant direct statutory interest in seeking to understand and ultimately prove the conduct of a trader occurring in the ordinary course of that trader’s business without the authority of the rights owner. One way of seeking to establish what is occurring in the conduct of a trader in the ordinary course of that trader’s business is for the rights owner to engage in a transaction which is said to characterise conduct which, if occurring in the ordinary course of that trader’s business in goods or services for which the trade mark is registered, amounts to infringing conduct on the part of the relevant trader.

41    Steps of this kind would be taken by rights owners every day in Australia in seeking to understand whether a trader is infringing the intellectual property rights of the rights owner. The evidence of the relevant transaction is relied upon as evidence of what occurs in the relevant marketplace in the ordinary course of the trader’s business in the relevant goods or services.

42    In this case, the relevant transactional forum is Redbubble’s website with its very particular features of transactional engagement as described extensively in the 2019 judgment and as accepted as the elements of the enduring transactional business model relevant to these proceedings. No trap purchase could ever be evidence of conduct constituting infringing use if that evidence was habitually displaced or ignored by courts on the footing that it necessarily occurred with the authority of the rights owner. A trap purchase is, functionally, evidence of whether a party is “using”, as a trade mark, a “sign” exhibiting the features described in s 120(1) of the Act in relation to goods or services for which the mark is registered, on the footing that what is reflected in the trap purchase is conduct which is occurring in the relevant marketplace. By reference to that evidence, the Court is put in a position where it can see by disciplined and accurate probative evidence, the emblematic character of conduct occurring on the part of the relevant trader in the course of its business so as to be in a position where it can reach a conclusion about whether all of the integers of s 120(1) of the Act are satisfied (if that is what is occurring).

43    Redbubble contends that the Court ought not to rely on the evidence of Mr Hansen as evidence probative of transactions said to constitute infringement of the trade marks in suit because on each and every occasion, Mr Hansen, as the trade mark officer of the authorised user, was acting with the authority of the trade mark owner and thus the transactions on the part of Redbubble were prompted, permitted and authorised by either or both of HAMC US or HAMC AU.

44    Redbubble, by its defence, called into question the title of HAMC US to the trade marks in suit. That defence was not pressed. However, Redbubble makes submissions concerning an analysis it conducted in relation to the state of the Australian registrations of the trade marks (by particular companies incorporated in different States of the United States and assignments from those entities) ultimately leading to registrations in HAMC US. It observes that as a result of that analysis it is “tolerably clear” that all five trade marks in suit have been registered since 14 March 2020 in HAMC US. Nevertheless, Redbubble makes the observation that it ought to be noted that the effect of what it describes as the “irregular and haphazard manner” in which the official records have been updated means that HAMC US was not the entity recorded as the registered owner of Trade Marks 1257992 and 1257993 at the time of the determination of the previous proceedings and thus as to those trade marks, HAMC AU was not an authorised user of those particular marks at that particular time.

45    Having regard to all of these matters, Redbubble contends that, as to this part of the proceeding, five questions arise and they are these:

(a)    Were the trade marks infringed by Redbubble in respect of the specific purchases of products by Mr Hansen bearing the artworks reflected in the seven examples?

(b)    Did HAMC AU sustain any loss and damage by reason of Redbubble’s conduct and, if so, what quantum, if any, ought to be awarded to HAMC AU?

(c)    If HAMC AU has sustained any loss and damage, is it entitled to any additional damages under s 126(2) of the Act?

(d)    Is HAMC AU entitled to any injunctive relief and, more particularly, the injunctive relief sought in the amended originating application?

(e)    Finally, is HAMC AU entitled to the declarations it seeks?

46    The applicant contends that there is a further question of whether an issue estoppel arises on the footing that Redbubble sought to agitate in the 2019 proceedings (between the same parties in respect of the same trade marks based on evidence of purchases by Mr Hansen) the proposition that no infringement arises in circumstances where the evidence relied upon by the applicant is evidence of transactions made by Mr Hansen through the Redbubble website and thus, the transactions were “prompted by” and made with the permission, approval and authority of the applicant.

47    Redbubble accepts that by reason of the concessions it has made as described above, the Court will find that it has infringed the trade marks in suit in the manner identified by the Court in the 2019 judgment at [468]. However, as emphasised above, Redbubble also contends that to the extent that the evidence of infringement relied upon to make good the applicant’s claims is the trap purchases by Mr Hansen and the receipt of goods in Australia, no infringement arises for the reasons already mentioned.

48    As to the seven examples relied upon by the applicant, the evidence of Mr Hansen is this.

49    Mr Hansen observes that in the first proceeding leading to the 2019 judgment, he gave evidence about the steps he took to make searches on the Redbubble website and purchase particular goods through the website resulting in the completion of the relevant transaction and the delivery and receipt of the goods relating to the various examples including Example 1 and Example 3 in that proceeding. He says that in 2020, as the trade mark officer for HAMC AU, his duties included monitoring, predominantly online, and identifying uses of designs or words which might be considered to be use of trade marks HAMC AU is entitled to use in Australia as an authorised user of HAMC US. Mr Hansen says that although Mr Mark Nelms, the director of the applicant, has lived overseas for some years, he and Mr Hansen have been in regular telephone and email communication regarding any designs which potentially infringe the trade marks the applicant is entitled to use under its arrangements with HAMC US. He also says that his communications with Mr Nelms involved whether to secure evidence of use of images or designs said to infringe the relevant trade marks, by purchasing products bearing the potentially infringing designs. He says that this was particularly the case with the search and purchase procedures he undertook in relation to Examples 1 to 7 on the Redbubble website.

50    Mr Hansen says that in 2020 between the months of May and November, in relation to each of the “designs” (signs) in Examples 1 to 7 in suit, his searches of the Redbubble website were prompted by Mr Nelms contacting him and asking him to search the Redbubble website from Australia to see if each of those examples appeared on the website to a person conducting a search from Australia and, if so, to purchase goods bearing those images.

51    Mr Hansen says that before he conducted the first search of what is Example 1, he did not expect that design (see Attachment C; comprising the upper rocker bearing the words “Hells Angels”, the winged death head profile and the letters “MC”, and the geographic lower rocker showing “Brazil”) to appear in Australia because of the trade mark infringement found in the first proceeding (which included all of those elements except that the lower rocker recited the geographical name “Virginia”). Mr Hansen says that as a result of his searches in relation to each of the seven examples, he was able to access all of them on the Redbubble website from his computer in Australia. He says that in relation to Example 5, he did not purchase goods bearing that design but did take screenshots of a t-shirt, a facemask and a sticker being offered for sale on the Redbubble website bearing the image depicted as Example 5 in Attachment C.

52    As to Example 1 described as “Hells Angels Brazil”, he says that the process was this.

53    On or about 11 May 2020, he conducted a search using the Google search engine and entered in the search field the term “Redbubble”. The search results returned as the top ranking item, the Redbubble website. He selected that site and was taken to the Homepage for the site. The site revealed the Redbubble logo. He then went to the search box and the field described as “Search designs and products” with a magnifying glass symbol. He entered into the search field the words “Hells Angels” and a separate search using the words “Motorcycle Clubs” and then clicked the search symbol. The results of the search produced many different images over a number of pages many of which did not appear to him to have any apparent connection with HAMC US or HAMC AU. However, amongst the search results was the design or image depicted under Example 1 in Attachment C. He says that based on his own experience and training as the applicant’s trade mark officer, he understood that Redbubble did not have any licence or authority to use “Hells Angels” on any product or a side view (profile view) of the winged death head device on any product or the words “Hells Angels” within the characteristic semi-circle shape otherwise known as the upper rocker sitting above the winged death head device. He says that using functions available on the website, he purchased one classic t-shirt bearing the Example 1 image for $37.46; one set of coasters bearing that image for $19.03; and one canvas-mounted print bearing the Example 1 image for $37.10. Mr Hansen then describes all of the various consequential functions of the website relating to such a transaction, none of which are in controversy. They included steps taken by Mr Hansen to insert all of his contact details, shipping and billing address and facility for making payment; the confirmatory email from Redbubble setting out the order number, estimated delivery date, shipping and billing address, a summary of the articles purchased, the price, a link to check progress of the order and details of the artist. It is not necessary in these reasons to set out every aspect of the engagement between Redbubble and Mr Hansen in relation to the purchase and the various emails generated by Redbubble concerning his purchase of the items and their ultimate delivery.

54    Mr Hansen says that he made a second purchase in relation to Example 1 by undertaking the same online searching procedure as described earlier and by making the same observations described earlier. He did so on 11 October 2020 which resulted in Image 1 being found on the site and a purchase being made of one acrylic block bearing Example 1 for $64.82. All of the same consequential processes were triggered and engaged by the purchase. Again, it is not necessary to set out the detail of those matters.

55    On 13 October 2020, Mr Hansen undertook the same online searching procedure as described at the outset in relation to Example 1 and made the same observations about the image as mentioned earlier. The range of possible products to which the design might be applied included a t-shirt. Mr Hansen proceeded to purchase one classic t-shirt bearing the design for $39.24. That transaction occurred on 13 October 2020. Again, all of the consequential steps otherwise described were triggered and engaged by the purchase.

56    Example 2 consists of the words “Hell’s Angel” with no device. Mr Hansen says that on or about 4 October and 13 October 2020 he conducted searches of the Redbubble website and on this occasion he used, again, the search terms “Hells Angels” and “Motorcycle Clubs”. The result of the search produced many different images over a number of pages many of which had no apparent connection with the images or designs or words connected with the applicant or HAMC US. However, among the field of results was what is Example 2, as capable of being applied to particular goods. Using the functions available, Mr Hansen purchased one facemask bearing Example 2 for $19.85 on 4 October 2020 and, on 13 October 2020, one t-shirt bearing the words depicted in Example 2 for $23.55. Again, all of the consequential steps relevant to such a transaction were triggered and engaged by those purchases.

57    On 4 October and 13 October 2020, Mr Hansen undertook precisely the same process using the same search terms. The result of the search produced many different images which Mr Hansen understood to have no connection with either the applicant or HAMC US. However, within the field of searches, the image depicted in Example 3 emerged. It took the form of a composite image showing the upper rocker bearing the words “Hells Angels”, the side view of the winged death head and the letters “MC” with a lower rocker containing the word “Brotherhood”. Mr Hansen purchased a facemask bearing the composite image on 4 October 2020 for $22.33 and a classic t-shirt bearing the side view of the singed death head for $25.51.

58    Again, all of the consequential steps relating to such a purchase were triggered and engaged by the purchases.

59    The same steps were taken on 4 October and 13 October 2020 in relation to what is Example 4. That example consists solely of a side view of the winged death head. On 4 October 2020, Mr Hansen purchased one sticker bearing the Example 4 image for $5.10. On 13 October 2020, Mr Hansen purchased one classic t-shirt bearing the Example 4 image for $26.68.

60    Again, all of the consequential steps were invoked and triggered by the two purchases.

61    On 6 October 2020, Mr Hansen undertook the same process using the same search terms which produced a field of search results which included the image depicted at Example 5 comprising the side view of the winged death head, an upper rocker bearing the words “Hells Angels” and the letters “MC”. Mr Hansen did not make a purchase of any items but took screenshots of product offerings using the image described as Example 5 as he had found it on the Redbubble website.

62    On 13 October 2020, Mr Hansen undertook the same search process using the same search terms which produced a field of searches including a composite image made up of a side view of the winged death head, the letters “MC”, an upper rocker bearing the words “Hells Angels” and a lower rocker bearing the word “Forever”. On 13 October 2020, Mr Hansen purchased a t-shirt bearing the Example 6 image for $29.43. Again, the purchase triggered the transactional processes of the website in relation to that purchase.

63    On 25 November 2020, Mr Hansen undertook the same process involving the same search terms which resulted in a field of images within which was the image depicted as Example 7 comprised of a side view of the winged death head, the letters “MC”, an upper rocker bearing the words “Hell’s Angels” and a lower rocker bearing the word “Brotherhood”. On 25 November 2020, Mr Hansen purchased a t-shirt bearing the Example 7 image for $25.51 and a poster bearing the Example 7 image for $18.31. Again, all of the consequential steps associated with such a purchase were engaged by the purchase.

64    Each purchase resulted in the goods being delivered to Mr Hansen’s Queensland address through the processes engaged through the Redbubble website.

65    As to these seven examples, Redbubble makes a number of observations about the scope of engagement with the images the subject of each example.

66    First, none of the third party uploaders of the relevant image to the site seeking to make the image available for application to a field of goods, provided an Australian address when registering his or her account on the website.

67    Second, of the seven examples, Redbubble “proactively moderated” three of them several months before the proceedings were commenced by the applicant.

68    Third, of the seven third party uploaders to the website, Redbubble had terminated the accounts of two of them several months before the applicant commenced the proceedings.

69    Fourth, only two users of the site who provided an Australian address purchased products bearing the images through the Redbubble website. They were Mr Hansen and Ms Lyhne. Redbubble observes that for one of her purchases, Ms Lyhne provided a residential and shipping address outside Australia in Slovenia and for the other she provided an Australian address even though she was based in Slovenia.

70    Fifth, the total gross revenue derived by Redbubble from Australian sales of the products was AU$133.65 and the total gross revenue Redbubble obtained from sales to users of the website in relation to any one or all of the seven images in other countries was AU$344.51.

71    As to Ms Lyhne, the applicant says that it does not rely upon any evidence, in relation to any of the seven examples, other than the evidence of Mr Hansen.

72    As to the seven examples, Mr Toy has provided the following information about them.

73    The proceeding was commenced by the applicant on 31 December 2020 and the originating application was served on 4 January 2021. The third party uploader of the image comprising Example 1, uploaded the image to the website on 15 January 2020 and provided an address in Brazil when registering his or her account on the website. On 5 January 2021, Redbubble’s “Content Operations Team” (the “COT”) moderated the image. Moderation is a term which means to remove or disable access to the webpage on the Redbubble website where the artwork of the uploader is listed and through which products bearing the artwork could be purchased through the functions of the website. The artwork comprising Example 1 was never reinstated to the website.

74    Mr Toy explains that the Redbubble COT had not captured the Example 1 artwork as part of the proactive moderation process as neither the “title” of the artwork nor its “tags” contained the words “Hells Angels” or something similar. The title was “Outlaw Motorcycle Clubs” and the tags were “Outlaw”, “Motorcycle” and “Clubs”. It should be noted that the term “Motorcycle” forms part of the name of the applicant and the words “Motor” and “Cycle” form part of the name of HAMC US and thus they might be thought to be tags which had some relevance or connection with the applicant and HAMC US.

75    Mr Toy observes that although the artwork was on the website from 15 January 2020 to 5 January 2021, only two users who provided an Australian address purchased products through the website bearing the artwork. One user was Mr Hansen who purchased goods on 10 May 2020 (two t-shirts, a canvas-mounted print and a set of coasters), 10 October 2020 (an acrylic block) and 12 October 2020 (another t-shirt). The second user is a purchaser described by Mr Toy as a “Purported Australian Purchaser” who was using an internet protocol address located outside Australia when placing an order for a t-shirt on 10 May 2020. This description is a reference to Ms Lyhne, the wife of Mr Nelms. Ms Lyhne also made another purchase on 16 October 2020 (an Example 2 purchase). Mr Nelms and Ms Lyhne live in Slovenia. When Ms Lyhne engaged with the website, she did so (and placed the two orders) from an IP address outside Australia, hence the reference by Mr Toy to the “Purported Australian Purchaser”.

76    The applicant says that it relies on the purchases made by Mr Hansen. It says that there is nothing “sinister” about the two purchases by Ms Lyhne as they were undertaken as nothing more than a means of alerting Mr Hansen as the applicant’s trade mark officer to the image now described as Example 1 so as to enable Mr Hansen to see if the image could be accessed from Australia and, if so, to make a purchase of goods, through the website, bearing the image, as a matter of evidence.

77    The account of the third party uploader was terminated by Redbubble on 5 January 2021 in accordance with Redbubble’s policies governing approaches to repeat offenders and scaled abusers who violate the “User Agreement”.

78    It should also be noted that the image now described as Example 1 (like all of the seven images) is described by Mr Toy as the “artwork” of the third party uploader. As a generic description, the reference to “artwork” is understandable but it is apt to understate the scope of the real problem in issue. It needs to be kept in mind that the “artwork” so enabled by the website is nothing more than the out-and-out flagrant usurpation (perhaps by a repeat and scaled abuser having regard to Mr Toy’s references to those terms in his affidavit when describing the cancellation of the relevant account holder) of another party’s stylised device and badges of identification which, in this case, are the registered trade marks. There is nothing “artistic” about the conduct of the Brazil uploader which engages delicate and perhaps subtly argumentative questions of whether the image may or may not be substantially identical with or deceptively similar to the subject matter in which the rights subsist. Put anecdotally, the images are in every sense a taking of the trade marks in issue, expressed formally, of course, in the language of s 120(1) of the Act.

79    The term “Hells Angels” and the profile “device” of the winged death head of Example 1 were on the website for, essentially, 12 months.

80    As to Example 2, “hell’s angel”, it was uploaded on 27 June 2020 with the third party providing an address in South Africa when registering. The COT moderated the image on 4 January 2021 as a result of being served with the originating application that day. The image has never been reinstated to the website. This example is the first of four other examples within the seven examples in suit where proactive moderation failed to adequately engage in a protective way. As Mr Toy explains, Redbubble, since January 2018, has used, through the COT, a tool described as “Suspend for Review” (“SFR”). The tool is a software tool that automatically suspends from public view newly created listings to which the third party uploader has applied a title or tag that comprises certain search terms. Once suspended by the tool, users are not able to view the listing or purchase goods bearing the uploaded image unless and until a member of COT manually reviews the image and decides whether it should be proactively moderated (removed or disabled), “based on guidance from the rights owners”. In this example, the uploaded image is “hell’s angels”.

81    The SFR tool has limitations as it is keyword-based and does not utilise image matching or optical character recognition. In any event, in the case of Example 2, the SFR tool did detect and suspend the image on 27 June 2020, the day of the uploading. It was then manually reviewed by a member of the COT. The member of the COT that manually reviewed the uploaded image was a member of an outsourced group called the “Third Party Service Provider” (“TPSP”) based in Jamaica (called “TPSP Jamaica”), and overseen by Redbubble. Mr Toy says that a member of TPSP Jamaica manually reviewed the listing and erroneously released it rather than remove or disable it. The listing was ultimately disabled on 5 January 2021. Mr Toy explains at para 74 of his affidavit that Redbubble has ceased using TPSP Jamaica “as a result of such errors” and since August 2020, Redbubble has been using an outsourced team in Colombia subject to Redbubble’s oversight arrangements as described at para 72(a) to (e) of Mr Toy’s affidavit. In the period from 27 June 2020 to 5 January 2021, one user with an Australian address, Mr Hansen, purchased products on 3 October 2020 and 12 October 2020 bearing the image.

82    As to Example 3 (which comprises the words “Hells Angels” in the upper rocker, the profile, the profile “device” of the winged death head, “MC” and the word “Brotherhood” in the lower rocker), it was uploaded to the website on 5 September 2020. The third party uploader provided an address in the United Kingdom when registering his or her account. The image was removed from the website on 13 October 2020 (well before service of the originating application on 4 January 2021). However, although the SFR tool also identified and suspended this image (no doubt due to the keyword search term “Hells Angels”), the manual review of the image by a member of the TPSP Jamaica team resulted in this image also being erroneously released to the website. That occurred on 7 September 2020 where it remained until 13 October 2020. In the period between 5 September 2020 and 13 October 2020, Mr Hansen purchased the products bearing the image on 3 October and 12 October 2020 as earlier described. The account of the third party uploader was cancelled on 12 November 2020.

83    As to Example 4 (which is the device alone), it was uploaded to the website on 29 September 2020 by a person who provided an address in the United Kingdom. The image was removed from the website on 13 October 2020 (again, well before service of the originating application) and has never been reinstated to the website. It too was identified by the SFR tool (on 29 September 2020) and manually reviewed by TPSP Jamaica on 30 September 2020. The image was erroneously released to the site on 30 September 2020. It ought to have been moderated on manual review. In the period from 29 September 2020 to 13 October 2020, Mr Hansen purchased goods bearing the image on 3 October and 12 October 2020 as earlier described. The account of the third party uploader was terminated on 4 January 2021.

84    As to Example 5 (which comprises the words “Hells Angels” in the upper rocker, the device of the winged death head and “MC”), the image was uploaded to the website on 26 September 2020. The uploader provided an address in Turkey when registering his or her account. The image was removed from the site on 8 October 2020. The image was detected by the SFR tool. It was manually reviewed on 28 September 2020 by a member of the TPSP Jamaica team and erroneously released to the site on 28 September 2020. Although Mr Hansen examined the site and identified the image now called Example 5, he chose not to purchase any articles as physical examples of goods to which the image could be applied consistent with the methodology of the website, and simply took screenshots of the image. The account of the third party uploader was terminated on 4 January 2021.

85    As to Example 6 (which comprises the words “Hells Angels” in the upper rocker, the profile device of the winged death head and the word “Forever” in the bottom rocker), the image was uploaded to the site on 11 October 2020 by a person nominating an address in the United States. It was detected by the SFR tool, manually reviewed by a member of the TPSP Jamaica team on 12 October 2020 and erroneously returned to the site on 12 October 2020 where it was thought to have remained until 6 January 2021 when it was removed. However, Mr Toy has reviewed that chronology and says that it was removed on 13 October 2020; was on the site from 11 October to 13 October 2020; and only 10 views of it occurred. The account of the uploader was terminated on 13 October 2020. In the period from 11 October 2020 to 13 October 2021, Mr Hansen purchased goods bearing the image as earlier described.

86    As to Example 7 (which comprises “Hells Angels” in the upper rocker, the device, “MC” and “Brotherhood” in the lower rocker), the image was uploaded on 22 November 2020. The image was removed on 4 January 2021 upon service of the originating application. It was never reinstated to the site. It was not detected by the SFR tool and was not subject to manual review (as it would have been had the tool identified the image). However, the manual review in that event might have produced the same result as occurred in relation to Examples 2, 3, 4, 5 and 6. In any event, in the period between 11 October 2020 and 4 January 2021, Mr Hansen ordered a poster and a t-shirt bearing the image.

87    As to the operation of the Redbubble website and all the functional steps representing the business model, Redbubble affirms all of the elements described in the 2019 judgment (see Attachment “E”. Also, Mr Vydra, Redbubble’s Chief Technology Officer, put on an affidavit repeating large parts of the text in the 2019 judgment in his affidavit which set out and described the elements of Mr Kovalev’s earlier evidence. Mr Kovalev was Redbubble’s former Chief Technology Officer. Although Mr Vydra is criticised by the applicant for slavishly repeating text from the 2019 judgment, I proceed on the basis that Mr Vydra, for his own part, is simply affirming the currency of the earlier description. There are many ways, no doubt, that that could have been done.

88    As mentioned earlier, Mr Toy has provided extensive evidence concerning the procedures and practices adopted by Redbubble to seek to identify and address unauthorised use on its website of the intellectual property of others. It is fair to say that there are two dominant or broad features of the approach by Redbubble and they are said to have an important inter-relationship.

89    The first concerns the steps, practices and procedures adopted by Redbubble to identify and address an uploader’s use of another person’s intellectual property, and the notices and counter-notices those processes engage and other proactive moderation processes Redbubble seeks to use. The second broad theme concerns the working relationship and degree of engagement between Redbubble and the relevant rights owner. An important aspect of the second feature is said to be the extent to which the rights owner collaborates with Redbubble to settle and agree upon the search terms to be deployed in seeking to identify potentially problematic images uploaded to the website that may be thought to infringe the intellectual property rights of a party and, in this case, the applicant or HAMC US, and the frequency of conducting searches according to particular protocols and agreed search terms.

90    Redbubble contends that the applicant has failed to engage with it in settling and revising search terms and it says that notwithstanding that failure to engage, Redbubble has conducted “site sweeps” of the website regularly to seek to isolate images that infringe upon the rights of the applicant and HAMC US.

91    Redbubble also says that had the applicant notified it of the presence of images on the site of concern to the applicant, immediately on discovering those images on Redbubble’s website, Redbubble could (and would, it says) have taken steps to remove access to the webpages displaying the images.

92    I accept that Redbubble has adopted over time a range of practices and procedures as described in the 2019 judgment and described in the evidence of Mr Toy (and, necessarily, Mr Vydra, given his adoption of the text of the earlier judgment). I also note these matters:

(1)    Although the COT had comprised 10 to 12 members as at 27 July 2017, it had grown (as at 13 May 2021) to 50 members made up of 20 Redbubble employees and 30 agents as part of the outsourcing of COT functions to what is now TPSP Colombia but formerly was TPCP Jamaica.

(2)    Since first engaging with TPSP Jamaica, Redbubble has made the improvements to its quality control processes in supervising outsourced TPSP functions described at para 76 of Mr Toy’s affidavit.

(3)    Redbubble has an IP Policy which sets out a procedure that a rights owner can invoke if it considers that an “artwork” has been uploaded to the website which infringes its rights. Thus, it can complete an online “Notice and Takedown Report” by providing Redbubble with information comprising a description of the intellectual property in issue; identification of the artworks said to infringe; confirmation that the complainant is the rights owner; confirmation that the complainant has a “good faith belief” that the artworks infringe its rights; and an email address for the complainant for communication about the complaint.

(4)    Although all of these matters are very reasonable in themselves as a method of addressing, from time to time, a particular transactional image uploaded to the website, Redbubble well knows, so far as the applicant is concerned, the precise intellectual property in issue; the source of the rights in the registered trade marks that the applicant and HAMC US enjoy under the Act; and, the precise content of the trade marks and the classes of goods in respect of which each of them is registered. Moreover, all of this has already been tested in litigation and has been the subject of previous orders. One issue is the extent to which Redbubble is itself vigilant (without the need for the applicant and HAMC US to be constantly monitoring Redbubble’s website for infringements) of images uploaded to its site that are properly described as substantially identical with, or deceptively similar to, the trade marks in issue and with which Redbubble is very familiar both as to its COT and its Legal Team.

(5)    I accept that Redbubble has a proactive moderation process that operates without the need for a rights owner to engage with the Takedown Notice and Counter-Notice procedures especially where the rights owner has “legitimate difficulties” with the procedure; where the rights owner is “becoming increasingly frustrated” with that process; or where “legal action” might be “imminent”. The proactive moderation process involves Redbubble engaging with the rights owner to agree a set of “Proactive Moderation Guidelines” (the “Guidelines”) which “depict” the “content” in which the rights owner “claims, in good faith” to have “enforceable rights” (otherwise called the “Reference Content”) and it involves Redbubble obtaining “guidance” from the rights owner of the “nature and degree of similarity that needs to exist between the Reference Content and an uploaded artwork before the uploaded work is considered to be infringing”. As to these matters, see Mr Toy’s affidavit.

(6)    In the case of the applicant and HAMC US, the position is as clear as it can be on these issues. The “Reference Content” is each and every one of the trade marks now ultimately in suit again in these proceedings. The Reference Content is not subject matter in which the applicant and the second respondent “claim”, “in good faith”, to have “enforceable rights”, but rather, subject matter in which they have demonstrated and uncontested rights. As to “guidance” from the rights owner on the degree of similarity that needs to exist between the trade marks and the image, that matter is well-known and well understood and is expressed as whether the sign (image) is substantially identical with or deceptive similar to any one or more of the trade marks in issue (as is presently admitted in the case of the seven examples). This test of the degree of similarity would be well-known to the COT and Redbubble’s Legal Team. Thus, the applicant suggests that there are two questions arising out of Mr Toy’s evidence of proactive moderation. First, why is it the position that Redbubble was not able to quickly identify and deal with all of the seven examples uploaded to its website having regard to its state of knowledge of the matters just described? Second, having identified through the use of the SFR tool, the images at Examples 2, 3, 4, 5 and 6 and subjected those images to proactive manual moderation, why was each image returned to the website even though each image failed the test (and demonstrably so) of being substantially identical with, or deceptively similar to, the subject matter of the rights, having regard to all of the steps described by Mr Toy about proactive moderation? As to the latter matter, Redbubble deposes to the errors on the part of the outsourced TPSP Jamaica team. Errors of judgment were made. Nevertheless, they were errors of judgment in the context of Redbubble’s performance of its proactive moderation program so far as it affected the rights of the applicant and HAMC US. In a real sense, the failings on the part of TPSP Jamaica are an explanation, but from the perspective of a rights owner, not an answer, to failing to properly protect the rights of the trade mark owner and, more relevantly, for present purposes, the authorised user. It reflects a failure of quality control in the supervision of an outsourced group and resulted in the replacement of that group with the TPSP Colombia group.

(7)    As to the first question, there are a number of practical matters. In order to find an uploaded image that either may, or simply does, infringe the rights of another and, in particular, the applicant and HAMC US, the image has to be searched for and found. That step involves selecting search terms that are likely to isolate an image that contains the “Reference Content”. Thus, the search terms must be, as Mr Toy says, encompassing but also focused. Mr Toy describes the issue and some of the problems at para 55 of his affidavit. He also emphasises the desirability of the rights owner engaging with Redbubble to agree about the most appropriate search terms.

(8)    There are a number of difficulties concerning search terms at least in the context of this case. The first is that the applicant is an entity that is the embodiment of a group of like-minded motorcycle club members. Redbubble, on the other hand, is in the digital platform business. It has significant resources and corresponding platform expertise. It has experts in the management and organisation of digital content within its ranks. Some of them very helpfully have given evidence in these proceedings and they are impressive people. They are familiar with, as one would expect, the intimate detail of the functionality of platform and they are required to watch, manage and maintain it. They are intimately familiar with the hierarchy of protocols it engages when isolating content and they are familiar with or capable of selecting the most useful and adapted search terms that would likely optimise results on the platform in looking for content having regards to the fields and hierarchy of protocols that isolate content according to search criteria. No doubt, members of a motorcycle club could help and so too perhaps Mr Hansen, but the skills sets required to optimise the interrogation of the platform for relevant content are very likely to reside within Redbubble, its COT and its Legal Team.

(9)    Another aspect or difficulty concerning the issue of isolating content is that Mr Hansen says that he put the terms “Hells Angels” into the Redbubble search box and separately entered another search for the term “Motorcycle Club”. He then describes the seven examples he found as he did each of those searches when he did them. The applicant says that one question then is, independently of any engagement with the applicant or HAMC US, Redbubble, knowing that the applicant and HAMC US enjoy the rights in the subject matter of the particular trade marks (with which Redbubble and COT were well familiar), either separately for “Hells Angels” and the “device” (or in combination), and knowing that neither those trade marks, nor signs substantially identical with or deceptively similar to them, could be used (in Australia and in many other jurisdictions) through the website, how was Redbubble, by its regular sweeps of the site, unable to quickly find each and every example that Mr Hansen found when undertaking the steps he says he took? Aspects of the answer to that question are to be found in the evidence of Mr Toy mentioned shortly.

93    As to Mr Toy, I have already described aspects of proactive moderation described by him at paras 51 to 54 of his affidavit. These paragraphs describe the desirability of a rights owner engaging with Redbubble to establish the “Guidelines” and “Reference Content” and the “guidance” sought from the rights owner about what the rights owner believes to be infringing content.

94    As mentioned earlier, however, the generality of those processes had already descended to the specific in the case of the applicant and HAMC US so far as the trade marks are concerned. The question of importance was one concerning the “Search Terms”. Mr Toy says that the COT in consultation with the “Legal Team” formulates a “list of search terms and other filtering criteria that they consider would be most effective for finding artworks on the Redbubble website that might comprise or contain any of the reference content”. Unsurprisingly, the COT together with the Legal Team would be likely to enjoy the greatest facility for isolating search terms that would usefully engage with the website, avoid false positives as much as possible and focus upon the particular content or combination of content (words, variations on spelling, combinations of words, devices, stylised text and so forth). Mr Toy gives some examples at para 55(a)-(c).

95    As to searches of the website, Mr Toy says that if the rights owner has requested Redbubble to conduct a “site sweep” of the website, the COT will perform a sweep in the date range 2006 to the present. If the rights owner has requested Redbubble to conduct “regular policing”, the COT will perform a single “site sweep” and then, on a “regular basis” perform further searches starting from the date of the last search. As to what is meant by “on a regular basis”, Mr Toy says that before 10 December 2017, the frequency of “regular policing” was either “daily, weekly or monthly or somewhere in between”, but only during normal business hours in San Francisco. The COT, together with the Legal Team, decide the frequency of searching necessary for a particular rights owner based on factors such as the volume of allegedly infringing material uploaded to the site together with feedback from the rights owner. Since 10 December 2017, however, Redbubble conducts proactive moderation for “all” rights owners “every business day” during normal San Francisco business hours. Mr Toy says that since October 2019, outsourced proactive moderation also occurs (the first being the TPSP Jamaica team and then, at the date of the hearing, the TPSP Colombia team) which enables moderation to be conducted outside normal San Francisco business hours. Mr Toy says that sometimes a rights owner refuses to engage with Redbubble in “developing proactive moderation” in which case Redbubble may perform a “site sweep” or “regular policing” even though the rights owner has not requested it.

96    These other aspects of the approach should be noted.

97    The COT arranges for search terms to be entered into a software tool that automatically and continuously monitors for changes in a dynamic database of titles, tags and descriptions for images uploaded to the website. The search results will include images on the site for which an uploader has created a title, tag or description that comprises or contains a search term. The software tool organises and presents the search results by rights owner and content, on an online list, which enables COT to manually review the relevant image. If COT believes the image to be “similar enough” to any Reference Content, COT will moderate the image. COT sometimes chooses not to moderate the image if a COT member considers the image not to be similar enough to any of the Reference Content. This may occur because the search has thrown up a “false positive”, but more usually occurs where the image contains an element that seems to resemble Reference Content, but which has been “significantly transformed” by the uploader. If COT decides not to moderate, the image will remain on the site, but it remains open to the rights owner to invoke the Takedown Notice processes. In the case of the seven examples and the trade marks, there is no judgmental question to be made so far as the seven examples are concerned about whether an artist uploader has “significantly transformed” the works in which the intellectual property rights reside. They have been simply taken without authority.

98    Mr Toy says that from time to time, COT and the Legal Team will perform one-off manual sweeps of the site.

99    Mr Toy says that in his experience at Redbubble, there is a level of collaboration between a rights owner and Redbubble which is optimal to ensure that Redbubble is able to “effectively assist” the rights owner to enforce its rights. Mr Toy says that Redbubble and the rights owner “both benefit from Redbubble knowing what Reference Content to include in the Proactive Moderation Guidelines” and “understanding” from the rights owner “what it considers to be infringing material”. Mr Toy says that once “that level of collaboration is reached”, Redbubble can “usually handle” proactive moderation “on its own”, although Redbubble relies upon rights owners to inform it of new Reference Content. Mr Toy gives an example of new content as “new movies or games that are released after the Proactive Moderation Guidelines were created”.

100    Again, these observations are not focused upon the particular circumstances of the current problem. Redbubble knows precisely what the content of the Reference Content is and it understands the nature and scope of that which would be considered to be material infringing upon the trade mark rights. No level of collaboration with the rights owner is necessary for Redbubble to understand the content of the Reference Content or the conception of the rights owner as to what amounts to infringing material because that conception is well understood as a matter of law by both the Legal Team and, no doubt, COT. Mr Toy accepts the point that once Redbubble understands the content of the Reference Content and understands the legal obligations in relation to that which would be infringing content, Redbubble can “usually handle” a proactive moderation “on its own”. To the extent that Redbubble relies upon consistent updating of the Reference Content such as when a new film or new game is released, those examples have no application here.

101    Mr Toy gives some evidence of scale. He says that Redbubble conducts proactive moderation for approximately 477 rights owners including rights owners for whom Redbubble has established “Proactive Moderation Guidelines” and commenced moderation activities “without input or guidance” from rights owners “such as Hells Angels”. Mr Toy says that in the vast majority of cases proactive moderation occurs in collaboration with rights owners. Mr Toy says that at the time of his first affidavit of 27 July 2017, Redbubble was conducting proactive moderation for approximately 200 rights owners. Mr Toy says that Redbubble has proactively moderated approximately two million artworks since 1 January 2017 and of those approximately 1.2 million were moderated since 1 January 2020. Mr Toy says that Redbubble has terminated over one million uploader accounts since 1 January 2017 of which 200,000 were terminated in the last four months alone.

102    Much of the evidence of Mr Toy is directed to the extent to which Redbubble and the rights owner benefit from collaboration about Reference Content and the conception of the rights owner as to what constitutes infringing material. For the reasons already mentioned, those questions are much more focused in the case of the applicant and the answers to them are well understood by Redbubble.

103    Mr Toy says that since his affidavit of 27 July 2017, Redbubble has improved the software tool it uses to review and moderate images. Some aspects of that tool, described as the SFR tool, have already been described. Mr Toy says that Redbubble currently only uses the SFR tool for a select number of rights owners including, since January 2018, Hells Angels. Mr Toy says that in January 2021, Redbubble expanded the functionality of the tool beyond the detection and suspension of newly-created listings to also allow for suspension of previously created listings in order to give the COT sufficient time to conduct proactive moderation “sweeps” and, in particular, “large sweeps that may take significant time and resources to complete”. Mr Toy says that for over five years, Redbubble has been working to develop an image matching and optical character recognition software tool, most recently described within Redbubble as “RB Protect”. Mr Toy says that Redbubble has not yet been able to create a viable tool that can detect the intellectual property of rights owners “at scale in real-time” as works are uploaded to the website. Mr Toy says that the latest version of RB Protect is currently undergoing beta testing across a range of “use cases” to assess its effectiveness. It has been shown to be effective in detecting exact/identical matches between images in a reference library, on the one hand, and artworks uploaded to the website, on the other hand. Mr Toy says that Redbubble is further expanding the use of RB Protect by adding “Properties” to the reference library. He says that the aim of the project is that RB Protect will be able to prevent newly uploaded images which are “exact duplicates” of an artwork previously moderated or which are exact duplicates of an image provided to Redbubble by a rights owner, from being publicly viewed on the website until a COT member has manually reviewed the image and decided whether it ought to be moderated or not. Apart from these things, Redbubble has been developing new tools to detect repeat infringes who attempt to re-load content similar to previously moderated content. The tool is still being developed.

104    Finally, as to these matters, it should be noted that the applicant has been engaging with Redbubble since at least 24 December 2014 and raising complaints about examples of images uploaded to the website said to infringe the trade mark rights of the applicant. The examples of engagement are these:

(1)    By a letter dated 24 December 2014, Mr Bolam (the applicant’s solicitor) complained about eight images uploaded to the website. Seven of them were moderated by Redbubble. One was not (“Hells Grannies”). Redbubble’s general counsel, by letter dated 16 January 2015, offered to work with the applicant to address its concerns about infringing images.

(2)    In January 2015, Mr Bolam, by letter, identified three further images of concern, to Redbubble. The COT moderated all three.

(3)    On 20 March 2015, Mr Bolam identified to Redbubble images and signs of concern. The COT developed proactive moderation guidelines on the basis of the images and signs so notified.

(4)    On 23 March 2015, Redbubble conducted a “site sweep” using the guidelines and on 26 March 2015, Redbubble began “regular policing”, weekly, of the site according to the guidelines developed in relation to the applicant’s trade marks, from that date until 10 December 2017.

(5)    In November 2015, Redbubble became aware of two images said to be infringing (identified in the applicant’s reply in the earlier proceeding). Those images were then moderated by Redbubble.

(6)    As a result of the two examples described at (5) above, Redbubble modified the search terms to search for “Hells Angels”, “Hell Angel”, “Hels Angels”, “Hels Angel” and “Hell’s Angel”.

(7)    By a letter in January 2016, Mr Bolam identified a further example of an infringing image. The COT moderated that image.

(8)    By Mr Bolam’s affidavit of 11 April 2019, in the earlier proceeding, he identified two further examples of infringing images. The COT moderated the two images. Redbubble then expanded the search terms to include “Winged Skull”.

(9)    As to these proceedings, as already mentioned, they were commenced on 31 December 2020 and served on 4 January 2021. They revealed seven examples of images accepted as being substantially identical with, or deceptively similar to, one or more of the trade marks in issue. Three of the seven images had already been moderated (Examples 3, 4 and 5; although each of them were subject to the errors made by TPSP Jamaica on behalf of COT). After the commencement of these proceedings, search terms were again expanded to include “Motorcycle Club” or “Motorcycle Clubs”.

105    Mr Toy says, and I accept, that so far as the applicant is concerned, Redbubble has moderated 210 images uploaded to the website including 114 images moderated on and after 30 May 2019, and this is in addition to the images moderated by Redbubble as described at [101] of these reasons, as and when found by Mr Bolam and brought to Redbubble’s attention.

106    Redbubble contends that if Mr Bolam had notified Redbubble as soon as Mr Hansen had identified any or all of the seven offending images the subject of this proceeding, Redbubble would have immediately moderated each image. The applicant says that it undertakes these checks of the website to see whether Redbubble’s moderation steps about which it speaks are operating as it contends they do, and to check and verify whether images which infringe the trade marks in issue are being uploaded to the website and whether they are being isolated and removed.

107    As to the seven examples, the number of views of each of them, respectively, is as follows: 51, 21, 31, 13, 2, 1 and 11.

108    Before examining further aspects of the evidence, it is convenient to note some aspects of the rights conferred by the Act, notwithstanding that they are well understood.

109    The grant is conferred by s 20(1) of the Act which provides that the registered owner of the trade mark has, subject to the Act, the exclusive rights to use the trade mark, and to authorise other persons to use the trade mark, in relation to the goods (or services) in respect of which the trade mark is registered. Apart from these two exclusive rights, the registered owner also has the right to obtain relief under the Act if the trade mark has been infringed: s 20(2). As to the legal character of a registered trade mark, it is personal property, and equities in respect of the registered trade mark may be enforced in the same way as equities in respect of any other personal property: s 21. Thus, the intellectual property is a function of the grant and the right of a relevant person with standing to obtain relief for infringement, and the legal property in the trade mark is personal property with all equities recognised and able to be enforced.

110    Using or authorising the use of a registered trade mark falls squarely within the grant and infringes upon it. Using, as a trade mark, a sign that is substantially identical with, or deceptively similar to, the registered trade mark in relation to goods or services in respect of which the trade mark is registered, is an infringement of the registered trade mark for the purposes of s 20(2) and s 120(1).

111    Use of a trade mark in relation to goods means use of it upon or in physical or other relation to the goods: s 7(4).

112    An “authorised use” of a trade mark by a person is taken, for the purposes of the Act, to be use of the trade mark by the owner: s 7(3).

113    Redbubble accepts that the applicant is an authorised user of the HAMC US registered trade marks. Section 26(1) of the Act provides that the authorised user may, subject to joining the registered owner of the trade marks, bring an action for infringement of the trade mark.

114    The relief that may be granted under the Act (that is, the statutory remedies) in an action for infringement include an injunction (having regard to discretionary considerations) which may be granted “subject to any condition that the court thinks fit” (s 126(1)(a)); and, relevantly here, damages (s 126(1)(b)), subject to s 127 of the Act (which has no application here). In undertaking an assessment of damages for infringement, the Court may include an additional amount in such an assessment, if the Court considers it appropriate to do so having regard to:

(a)    the flagrancy of the infringement; and

(b)    the need to deter similar infringements of registered trade marks; and

(c)    the conduct of the party that infringed the registered trade mark that occurred:

(i)    after the act constituting the infringement; or

(ii)    after that party was informed that it had allegedly infringed the registered trade mark; and

(d)    any benefit shown to have accrued to that party because of the infringement; and

(e)    all other relevant matters.

115    It is now necessary to refer to some other aspects of the evidence.

116    Mr Francis Serignese Jr has performed the role of President of the Board of Directors of HAMC US. He has been a member of the Board of Directors since April 2015. He says that he has been a Club member for 10.5 years and for the past six years he has been a member of the Board of Directors. He says that he has become knowledgeable about the history and activities of HAMC US. He is also familiar with aspects of what I will call the ethos of club membership. He says that the winged death head and the trade marks of HAMC US are reserved for the use of the members of the Clubs around the world. They place importance upon them and only members are authorised to wear clothing bearing the subject matter of the trade marks. Using my terms, Mr Serignese is conveying that use of the trade marks and especially “Hells Angels” and the profile of the winged death head are “privileges” of use by members of the Clubs. Mr Serignese gave evidence that he would not want to see non-members wearing clothing bearing “Hells Angels” or the winged death head device, and were that to come to his attention, he would seek to prevent it or shut down any operator seeking to sell or provide clothing so marked.

117    In other words, the trade marks mean something to the members which, in turn, is of importance both in terms of the “ethos” and “use” of the registered trade marks by both HAMC US and, in the Australian context, HAMC AU.

118    Specifically, Mr Serignese accepted that had he seen on 10 May 2020 the image now described as Example 1, on a website being accessible throughout the world as a means of applying “Hells Angels” or the device, or both, to clothing supplied through the website to members of the public engaging with that website, he would have taken steps to try and foreclose that facility. Mr Serignese also observed that he did not handle issues of this kind in Australia and left that matter to HAMC AU although had he seen, for example, Example 1, in Australia, he would have referred it to one of the reps in Australia to do something about it as: “obviously”, “[w]e don’t want it out there. That’s for sure”.

119    That does not mean, of course, that there are no goods (for which the trade marks are registered) to which the marks are applied, for supply to members, with the authority of the trade mark owner and in the case of Australia, the applicant. Such licences are granted to the relevant service providers. The members who enjoy the privilege of wearing items of clothing that bear the trade marks as part of their like-minded identification or bonding, acquire goods bearing the marks from relevant suppliers in the way approved by the trade mark owner (and in the case of Australia, by the authorised user).

120    As to Mr Hansen, one of his roles is to ensure that HAMC AU complies with its obligations as an authorised user and to notify HAMC US of infringements of the trade marks when that occurs and to provide HAMC US with details of infringements. Mr Hansen said that he did that by providing emails relating to those matters. In cross-examination, Mr Hansen, as the trade mark officer for HAMC AU, expressed what can be described as frustration or exasperation or annoyance at finding (as he described that process) the seven examples in suit in these proceedings on the Redbubble website, HAMC AU having already taken court proceedings to obtain relief at trial in relation to three infringements of its trade marks. Mr Hansen says that he made the “trap purchases” to establish “purchases” of product through the website to which relevant infringing images (the examples, but for Example 5) were applied.

121    The proposition put against Mr Hansen is that he adopted something in the nature of a “deliberate strategy” of not informing Redbubble of trap purchases (or, at the very least, an “indifference” to telling Redbubble of the outcome of the searches and the trap purchases). I do not accept that the conduct of Mr Hansen ought to be characterised as a deliberate strategy so described, or indifference. Mr Hansen was searching the website in the way he described in order to see if infringing images were on the website, and he says that his purpose in doing so was to see whether offending conduct was continuing to occur and, if so, at what level, expressly with a view to gathering evidence of examples of the problem (if problematic images were on the site as it turned out they were), so as to enable HAMC AU to do something about it consistent with the grant to HAMC US under s 20(1) of the Act, the authorised user arrangements with HAMC AU and the proscription in s 120(1) of the Act.

122    Mr Hansen was concerned, and put the matter emphatically, that HAMC AU had previously established infringement of its trade marks and now found itself in a position where it had identified seven further examples of offending conduct occurring again concerning the very same trade marks. The 2019 judgment, of course, involved a range of other claims as well in which the applicant was unsuccessful. HAMC AU says that it did not tell Redbubble immediately of the particular examples as it wanted to test the capacity of Redbubble to detect and prevent the offending conduct within the limits of its own processes and capacities, and it was gathering the information for the purposes of possible infringement proceedings.

123    Mr Hansen accepted the proposition put to him by Redbubble in cross-examination that on those occasions when Redbubble had been told by Mr Bolam or otherwise of images on the website which infringed the trade marks, they had been promptly taken down as a matter of moderation. Mr Hansen also accepted the proposition put to him by Redbubble in cross-examination that one way, possibly, of dealing with the problem of infringing images being uploaded to Redbubble’s website, is for HAMC AU or Mr Bolam to bring the examples of infringement to the attention of Redbubble as and when they are found so that they can be taken down.

124    Thus, Redbubble contends that it lies ill in HAMC AU’s corporate mouth to complain about repeated infringements of the trade marks by Redbubble, at least as a basis for damages and additional damages (but also the grant of an injunction) when, it is said, had the applicant reported the infringements to Redbubble it could have secured their removal from the website.

125    The following further matters also ought to be noted.

126    Redbubble no longer maintains, as noted earlier, the point concerning HAMC US’s title to the trade marks in suit. Notwithstanding that concession, Redbubble emphasises the history of the Nevada Corporation and the change of address to Oakland, California, and the failure to change, on the Register of Australian Trade Marks, the Oakland address and the role of the Laconia, NH address. Redbubble also notes the matters relating to the assignment of 31 December 2008 between the Nevada Corporation and the California Corporation concerning Trade Mark Numbers 1257992 and 1257993, which was not submitted to the Trade Marks Office until March 2020. These matters are emphasised on the footing that the applicant is requesting the Court to exercise a discretion in its favour to issue an injunction to restrain the infringements (and relief in the form of damages) on the basis of the value the applicant places on its trade marks, yet, it is said, HAMC US (and HAMC AU) has been “careless” in maintaining correct particulars of title on the Register and such conduct is capable of being characterised as “potentially misleading”.

127    Redbubble resists any criticism made of it in raising the question of HAMC US’s “title” to the trade marks as a basis for an answer or defence to the claims of infringement made against it in the proceeding.

128    I accept that HAMC US (perhaps in conjunction with HAMC AU) has an obligation to maintain accurate and correct particulars on the Register of Trade Marks the registered owner of the trade marks and all details relevant to the corporation in question. I do not accept, however, that as a discretionary matter, that circumstance ought to deprive the applicant of a remedy on the merits if the cause of action is made good, and as a matter of the law of remedies, a remedy is otherwise available to the applicant.

129    The applicant asserts that the contention, by way of defence to the claims, of a defect in title to the trade marks in HAMC US and thus a defect in HAMC AU’s chain of statutory standing to assert relief for infringement (a proposition now abandoned) was never an answer to the claims of the applicant. The applicant contends that the question was an unnecessary distraction from the contentions of infringement and an entitlement to a remedy in respect of infringement.

130    The applicant is also critical of Redbubble’s approach to interrogatories. I do not intend to examine the issue in any real detail except to make these observations. The question concerned seeking, by way of the administration of interrogatories, answers to questions concerning whether there was at any relevant time a relationship between any one or more of the uploader parties and HAMC AU or HAMC US or some other association with what might be called simply Hells Angels: the so-called uploader defence.

131    Exchanges took place between Mr Bolam and Mr Barrett about the relevance and scope of the interrogatories. Draft interrogatories were provided by Mr Barrett. They were said to be either unnecessary or at least too wide. An amended version, narrower in scope, was submitted by Mr Barrett to Mr Bolam. Mr Bolam opposed the interrogatories. An application was filed on behalf of Redbubble seeking an order in relation to the narrower form of the interrogatories. Registrar Schmidt further narrowed the scope of the interrogatories (with Mr Barrett’s agreement), limited to the state of the information, knowledge or belief of the corporate officers as to the relevant matters. The interrogatories were answered in the negative. Thus, they did not advance the uploader defence. Nor is there any evidence that supports the contention inherent in the defence.

132    Having regard to all of these considerations, I am not satisfied that the claims of infringement made against Redbubble are answered by either the uploader defence or the proposition that none of the evidence of a transaction put on by Mr Hansen is probative of infringement on the basis that he acted with the authority of HAMC AU and HAMC US and thus the emblematic conduct sought to be illustrated by the trap purchases is, in effect, licensed conduct of Redbubble. I have already explained the difficulty with seeking to put that evidence aside as non-probative evidence of infringement.

133    In answer to the infringement case, it has been necessary to examine the “licence” defence and the “connected” uploader point and the forensic skirmish along the way concerning interrogatories.

134    There are more fundamental matters at the heart of the matter. They concern the question of whether it is ultimately an answer to a request for a discretionary remedy of an injunction so as to address infringing conduct on the part of the respondent to say to an applicant that having regard to the scale of the respondent’s business activity and the steps Redbubble takes to seek to protect the rights of the applicant, the appropriate course is for the applicant to tell Redbubble as and when the applicant or the applicant’s solicitor finds further examples of infringing conduct and to notify Redbubble so that the infringing material can be taken down, all leading to the proposition that in those circumstances no injunction should be granted.

135    I do not accept that Redbubble has done nothing since the 2019 judgment to improve its detection and moderation systems. I have already examined closely Mr Toy’s evidence about those matters. Further steps have clearly been taken and I have already indicated the view I take about those matters. However, clearly enough, they do not operate so as to bring about the result that infringements are always promptly detected and removed from the website. Further, the proactive moderation processes as outsourced to TPSP Jamaica failed in large measure to protect the applicant. I do not accept that a party otherwise establishing infringing conduct on the part of a respondent ought to be denied a remedy on the footing that if infringing conduct does occur, the real remedy upon which an applicant should rely is that the applicant or its solicitor should draw the infringing conduct to the attention of Redbubble as and when it occurs and Redbubble will take steps to moderate or remove the uploaded material, as an adjunct to the steps Mr Toy describes in his affidavit. As Mr Toy says at para 65 of his affidavit, once Redbubble understands the content of the “Reference Content” (as it clearly does in this case), Redbubble “can usually handle the Proactive Moderation on its own”.

136    The applicant is entitled to expect Redbubble not to engage in the conduct.

137    The grant of the s 20(1) exclusive rights and the right under s 20(2) to obtain relief under the Act (s 126) in respect of infringing conduct (s 120(1)) if the trade mark has been infringed, is not qualified by any statutory limitation such as “provided that any person not enjoying such rights is not susceptible of a remedy at the suit of the registered owner or an authorised user if, in all the circumstances, that person has done what they can to prevent infringing upon the rights of the registered owner or an authorised user (or both)”.

138    Discretionary factors as a matter of the law of remedies might mean that a remedy might not go for one reason or another in the face of infringing conduct, but once infringing conduct is made out, a remedy prima facie lies.

139    In principle and in the circumstances of this case, I am satisfied that an injunction ought to be granted. In the remedies judgment arising out of the 2019 judgment, I expressed the view that there are practical difficulties in framing an injunction in the language of the proscription in s 120(1) as doing so ultimately begs the question of whether particular conduct falls within or without the terms of the injunction. In this proceeding, however, Redbubble has been able to look at each image (Examples 1 to 7) no doubt as a function of caucusing between COT, Redbubble’s Legal Team and its external legal advisers, and form a view about whether, for the purposes of these proceedings, each impugned image or example is substantially identical with, or deceptively similar to, the relevant trade mark engaged by the relevant example. Accordingly, subject to what follows concerning the second phase of the proceeding, an injunction ought to be framed so as to prevent Redbubble from infringing the relevant features of the relevant trade marks as illustrated by the examples, and any image that is substantially identical with, or deceptively similar to, the relevant trade mark.

140    Before considering any question of damages and the issue of relief further, I will now turn to the second phase of the bifurcated case in relation to Examples 8, 9, 10 and 11, and any other aspect of the evidence which has a bearing on Examples 1 to 7 or a remedy in relation to Examples 1 to 7 and 8 to 11.

141    As earlier mentioned, the applicant was given leave to re-open its case to rely upon four further examples of contended infringing conduct described as Examples 8 to 11. The applicant amended the statement of claim to plead the four new examples adopting the same formulation of contended infringing conduct. The four new examples were also sought to be relied upon as a basis for additional damages as the applicant contended that these four examples, put anecdotally, came on top of the earlier seven examples in suit and on top of the three trade mark infringements the subject of the 2019 judgment with particular emphasis being given to the features of Example 1 at Attachment “B” (other than by reference to the geographical lower rocker containing the word “Virginia”). In that sense, the four further examples were said to inform, or at least be relevant, to the earlier seven examples in assessing damages and particularly in determining whether an “additional amount” ought to be included in an assessment of damages in relation to infringement, as a means of expressing the need to deter similar infringements as contemplated by s 126(2)(b) of the Act. The applicant contended that Redbubble ought to be discouraged from proceeding on the contended footing that infringements of the applicant’s trade marks and the cost of litigation associated with that conduct was simply a cost of Redbubble doing business. In that sense, there was said to be an inter-dependency between the first seven examples and the four further examples.

142    I will turn to the particular examples shortly.

143    As to the four further examples, Redbubble contends that these four examples do not constitute infringements of the trade marks in suit even applying the formulation described at [32] to [36] of these reasons.

144    Redbubble contends that Examples 8 to 11 do not take matters in issue between the parties in this proceeding any further than the position reflected in the submissions of the parties at the close of the first phase of the case concerning the first seven examples except that the Court has now had the benefit of further evidence from Redbubble (Mr Vydra) about the state of Redbubble’s image matching software. I do not propose to examine that matter in any real detail as I accept that Redbubble does deploy image matching software to try and identify an image (such as the profile view of the winged death head, should it be uploaded to Redbubble’s website by someone acting without the authority of HAMC AU or HAMC US), as part of Redbubble’s proactive moderation processes. However, the software is said to have limitations. It is limited to determining “duplicates” through digital “fingerprinting”. Redbubble says that software tools are not yet available to it which have general purpose image recognition capability. I understand Mr Vydra’s evidence to be that if the image uploaded to Redbubble’s website is truly a “duplicate” of, for example, the winged death head device, a “digital fingerprint” of that device will identify the “duplicate” of the fingerprint, but if the device has something added to it such as stylised text, it will not be detected even though the device might be part, and perhaps a substantial part, of a composite image such as the device and the text “Hells Angels” in a stylised form.

145    Thus, the focus on identifying a carefully thought out range of search terms by COT and the Redbubble Legal Team having regard to their expertise in the management of the platform and their intimate understanding of its functionality, likely to isolate infringing uses of the applicant’s trade marks, becomes the primary means by which Redbubble can and ought to act in deploying protective and proactive moderation to stop parties uploading the applicant’s trade marks or signs substantially identical with, or deceptively similar to, those trade marks, to the website for flagrant use.

146    So, what then is the further evidence of Mr Hansen?

147    Mr Hansen swore an affidavit dated 21 August 2021 (the “second affidavit”). Mr Hansen says, as he said earlier, that he is familiar with the Redbubble website and conducted searches of it in relation to the earlier proceeding and in relation to the earlier seven examples in this proceeding. He says that although Mr Nelms lives overseas, Mr Hansen has been in regular telephone and email communication with him regarding any potentially infringing designs generally (and whether to secure evidence of use of such designs by purchasing products bearing the potentially infringing images and/or to obtain screenshots of the relevant online offerings). He says that one such communication with Mr Nelms occurred on or about 6 August 2021 when Mr Nelms contacted him and asked him to search the Redbubble website to see whether four designs (now described as Examples 8, 9, 10 and 11) were apparent to a person conducting a search of the Redbubble website from Australia. Mr Hansen did so. He says that he did not expect to find Examples 8, 9, 10 and 11 by searching in Australia having regard to the first proceeding and, he says, “more importantly, we had only just had a trial only three weeks before” concerning Examples 1 to 7.

148    Mr Hansen says that he was surprised, disappointed and angry to see that he was able to access all of Examples 8, 9, 10 and 11 on the Redbubble website from his computer in Australia on 6 August 2021.

149    As to the search process, he says that on 6 August 2021, he conducted a search using the Google search engine and entered the search field “Redbubble”. It returned the Redbubble website at its Homepage. To the right of the Redbubble mark, he located a search box or search field with the words “Search designs and products” with a search symbol. Within the search field, he entered the search term “Hells Angels” and then clicked the search symbol which started a search of the site for designs and products. The search result included many different images over a number of pages many of which, he says, did not appear to have any apparent connection with HAMC AU or HAMC US whatsoever. He says that above the results was a heading called “Most Relevant” with a drop menu with four choices to select from, namely: “Most Relevant”, “Trending”, “Newest” and “Best Selling”. He says that he selected “Newest”. He says that he describes this process just mentioned as his “search process”.

150    Mr Hansen says that on 6 August 2021, Example 8 was amongst the results of his search process. He says that because of his training as the applicant’s trade mark officer he identified the words “Hells Angels”, the side view death head device and the words “Hells Angels” within the characteristic semi-circular shape described as the upper rocker sitting above the side view of the death head device. He says that they were very similar to one or more of the trade marks in suit: see Attachment “D”, Example 8. He says that using the functions on his computer he proceeded to make screenshots of a range of products being offered on the Redbubble website to which Example 8 could be applied by a person in Australia seeking to do so and the various prices for the field of goods. At para 16 of his affidavit, he identifies 11 items potentially available for a user in Australia to which the Example 8 might be applied. He exhibits copies of the screenshots to his affidavit (Annexure GH-16).

151    As to Example 9, he says that on 6 August 2021, he undertook the same search process and identified an image bearing the words “Hells Angels”, the side view of the death head device and the words “Hells Angels” within the shape described as the upper rocker sitting above the device: Attachment “D”, Example 9. Again, he proceeded to make screenshots of products being offered on the website. He focused upon clothing and printed products. He identifies them at para 19 of his affidavit and the various prices for the goods. He exhibits the screenshots to his affidavit as Annexure GH-17. He says that on 13 August 2021, he again carried out the search process he describes and “identified printed and clothing products bearing Example 9 [which] still appeared to me on the Redbubble website”.

152    As to Example 10, Mr Hansen says that he conducted a search on 6 August 2021 which identified an image described as Example 10 consisting of the words “Hells Angels”, the side view of the death head device and the words “Hells Angels” within the upper rocker above the device: Attachment “D”, Example 10. He says that he proceeded to make screenshots of images of products being offered on the website to which the image might be applied. He sets out examples of clothing to which the image might be applied and the prices at para 24. At para 24(d), he identifies a range of printed material to which the image could be applied and the prices for those materials. The screenshots are Annexure GH-19 to his affidavit.

153    As to Example 11, Mr Hansen conducted a search process on 6 August 2021 which revealed an image showing the words “Hells Angels”, the same device and the words “Hells Angels” located within the characteristic upper rocker: Attachment “D”, Example 11. He then identified screenshots of products being offered on the site (a t-shirt and printed products) and the prices for them respectively. The screenshots are Annexure GH-20 to the affidavit. He says that on 13 August 2021, he again carried out the same search process and “identified clothing and printed products bearing the Example 11 image [which] still appeared to me on the Redbubble website”.

154    Mr Hansen also gave evidence by an affidavit dated 22 October 2021 and by giving oral evidence.

155    In his affidavit of 22 October 2021 (the “third affidavit”), Mr Hansen says that he understands that Redbubble filed evidence of a forensic review of user activity associated with accessing and navigating the Redbubble website occurring in the period between 9.00am and 10.25am on 6 August 2021. He says that the earliest screenshot annexed to his second affidavit is a screenshot dated and time-stamped “Fri, 6 Aug 9:20 am” depicted in the lower half of the screenshot. The screenshot records that the search term used was “Hells Angels”; there were 4,201 results which were viewed by a filter described as “Newest” which depicted (among other images) the Example 10 image described as the “Hells Angels Sydney” image and the Example 8 image described as the “Hells Angels Nijmegen” image. He says that by directly clicking on these designs, he was able to access the various products that were available to be purchased making use of those designs and he took screenshots of certain of the products in combination with the designs which he understood to be within the range of products for which the trade marks in suit in the proceeding are registered.

156    Mr Hansen says that upon giving further consideration to the steps that he took in locating Examples 8, 9, 10 and 11 on the Redbubble website, he recalls that “in the course of exploring or ‘burrowing down’ the various products available on the Redbubble website that made [or could make] use of Examples 8 and 10, the Redbubble website produced other designs that it suggested may interest me and these included HAMC [Hells Angels] San Andreas (Example 9) and HAMC [Hells Angels] Nomads (Example 11)”. Mr Hansen says that he clicked on these designs, prompted to him by the website, and again says that he “burrowed down” the various products available on the website “that made [or could make] use of these two further designs”.

157    Mr Hansen says that to evidence some of the steps that he undertook to access and navigate the website commencing from the Hells Angels search, he took screenshots of pages from the website marked Annexure GH-22 to his affidavit. He says that the screenshots represent screenshots commencing from the Hells Angels search he commenced on 6 August 2021 and ending on 13 August 2021. He says that the screenshots at Annexure GH-22 do not record all of the steps he took. He says that he did not take screenshots of the suggestion prompted by the website of offering Examples 9 and 11. He says that he did, however, take screenshots of certain of the products that were available for purchase on the website using Examples 9 and 11 if that is what the user sought to do. He says that the screenshots annexed to his second affidavit and those at Annexure GH-22 were captured by Mr Hansen using his MacBook Pro computer while on the Gold Coast, Queensland.

158    Mr Hansen says that he is informed that Redbubble contends that he accessed the Redbubble website prior to the Hells Angels search, using an electronic link that had been provided to him rather than searching the website in the way that he described. He says that “that may have been the case”, but the Hells Angels search records that, on that occasion, he undertook the search of the website using the search term “Hells Angels” and from the search results he directly accessed Examples 8 and 10. He observes that page 21 of Annexure GH-22 records a similar search in which the search term used by him was “Hells Angels”.

159    Mr Hansen says that the screenshots in Annexure GH-22 include error messages (at pages 49 and 50) as well as screenshots of Example 11 (at page 51) and Example 9 (at page 52) all dated 12 August 2021. He says that whilst he believes that at about this time he undertook fresh searches of the website using the search term “Hells Angels”, he has difficulty recalling whether he used hyperlinks or bookmarks of Examples 8, 9, 10 and 11 on the website from earlier searches although pages 49 to 52 of Annexure GH-22 suggest to Mr Hansen that he may have used hyperlinks or bookmarks of those four examples on the website from earlier searches, and that as at 12 August 2021, the hyperlinks or bookmarks to Examples 8 and 10 were no longer active. He says that, however, the hyperlinks or bookmarks to Examples 9 and 11 remained active. He says that he was able to access these examples on the Redbubble website on 12 August and 13 August 2021 (that is, Examples 9 and 11).

160    On this topic of searches of the website, Mr Bolam filed an affidavit dated 22 October 2021 and he says these things.

161    On 6 August 2021, Mr Bolam used his Apple iPhone to access the Redbubble website as he describes in the affidavit. He says that he had been informed (it seems by Mr Nelms by email) that further infringing designs were able to be found on the Redbubble website using the search term “Hells Angels” and by viewing the search results under the field “Newest”. He says that using his iPhone, his recollection is that he undertook a Google search to locate the Redbubble website although he has no particular recollection of undertaking the Google search. However, he says that having accessed the Redbubble website he then used the search term “Hells Angels” to conduct a search of the products on the Redbubble website. He says that having regard to the information that he had received that further designs could be found by viewing the search results by “Newest” he believes that he then viewed the search results using the search term “Newest” which appeared within a dropdown search menu. He says that from the search results sorted by “Newest” he identified two designs which he considered to be infringing. He says that using functions available on his iPhone he took screenshots of some of the images he viewed on the website depicting the two designs. He annexes a true copy of the screenshots he took on 6 August 2021 at 10.16am, 10.17am, 10.20am and 10.21am (the Vodafone network bars not being part of the screenshot of the webpage on the Redbubble website): Annexure PDB-33. The screenshots forming Annexure PDB-33 show six illustrations of Examples 8 and 10, three of each.

162    As to Examples 8 to 11, Redbubble contends that they can only amount to trade mark infringements if each image was “available to be used to manufacture” items within the specifications of goods for which the trade marks were registered. Redbubble says that no one, including Mr Hansen, “actually sought to buy any products” in relation to the images at Examples 8 to 11. Redbubble contends that it is highly likely that no one, not connected to HAMC US or HAMC AU, searched for or found any of the images described as Examples 8 to 11. Redbubble says that the circumstances concerning Examples 8 to 11 are “very different” to the circumstances that led to the findings of infringement in the 2019 judgment.

163    Mr Toy has given evidence about these further four examples.

164    As to Examples 8 and 10, he says this.

165    On 1 August 2021, the uploader of these images registered his or her account on the Redbubble website with the username “Rahandukan”. That person provided, as their real name, Salvador C Yow, and provided a residential address in the United States. On 1 August 2021, Rahandukan uploaded the images creating the title “what [happened] angels in hells” and the tags adopted were “motorclub”, “club”, “most relevant”, “best selling”, “trending” and “newest” for both images. The COT moderated the images on 10 August 2021 having found them in the course of manual searching. Mr Toy says that this occurred three days before the applicant first complained to Redbubble about the images on 13 August 2021. Since moderation, the images have never been reinstated to the website. Mr Toy says that because the words “Hells” and “Angels” are separated and reversed in the title, automatic searching did not capture the images. Mr Toy notes that in the period between 1 August and 10 August 2021 when the images remained on the website, no users purchased any products through the website bearing either of the images. On 10 August 2021, Redbubble terminated the account of Rahandukan on grounds relating to repeat infringers and scaled abusers.

166    As to Examples 9 and 11, Mr Toy says this.

167    On 1 August 2021, the uploader of the images registered his or her account on the website using the name “Rakonsisten”. The uploader provided as their real name Rafael M Jackson and provided a residential address in the United States which was not the same address nominated in relation to Examples 8 and 10. The images uploaded by Rakonsisten bore the title “love ridding motorcycle night” and the tags were “motorclub”, “most relevant”, “best selling”, “trending”, “newest” and “merch” for both images. The COT moderated the images on 13 August 2021 as a result of a complaint by the applicant on that date. The images were never reinstated to the website. Mr Toy says that given that neither of the images nor any of the tags comprised or contained “Hells Angels”, any variation of “Hells Angels” or any of the other search terms that COT used for HAMC AU or HAMC US at the time, neither the automatic searching nor manual searching identified the two images. Mr Toy says that while the images remained on the website in the period between 1 August and 13 August 2021, no users purchased any products through the website bearing either of the images. On 13 August 2021, Redbubble terminated the account of Rakonsisten in accordance with the repeat infringers and scaled abusers protocols. Investigations conducted by Redbubble revealed these facts. Rahandukan and Rakonsisten share the same payment details which is linked to a person who is not named Salvador C Yow or Rafael M Jackson. The person who created the two accounts can be linked, by payment details, to at least 110 other scaled abuser accounts. The internet protocol address for the person creating both accounts and uploading all four images is linked to Indonesia. Mr Toy says that although he did not understand HAMC AU (or HAMC US) to be claiming “rights” in the term “motorclub” and although neither entity had requested Redbubble to add that term to the Hells Angels search terms, Mr Toy nevertheless instructed COT to include that term on 13 August 2021. Mr Toy says that using that term as a Hells Angels search term has resulted in many “false positives”.

168    Redbubble contends that the images at Examples 8 to 11, in order to be detected on the website as they appear in those examples, by Mr Nelms and then Mr Hansen, required “determined and focused activity” on their part and thus Mr Hansen’s evidence of his engagement with the website cannot be used, it is said, as an indication of what “an ordinary consumer from Australia would [do] or could reasonably have done” in the period 1 August to 10 August 2021 when Examples 8 and 10 were on the website or during the period 1 August to 13 August 2021 when Examples 9 and 11 were on the website.

169    The Rahandukan uploads (Examples 8 and 10) which are substantially identical with, or deceptively similar to, the relevant trade marks were marked with a title and tags which Redbubble accepts would have resulted in the images having been included in search results sought out by a user entering “Hells Angels” into the website as a search term. Redbubble notes, however, that the images would have been included within many thousands of search results.

170    Redbubble observes that the Rakonsisten uploads (Examples 9 and 11) did not have either titles or tags used by Redbubble in moderating images offending the rights of the applicant or HAMC US. Redbubble draws a distinction between searches on what it describes as the consumer side of the website (a user conducting a search using, for example, “Hells Angels” or “motorcycle” or other search terms that might reveal an image which offends the rights of the applicant on the one hand) and search terms deployed by Redbubble as determined by COT and the Redbubble Legal Team in undertaking proactive moderation “itself”, on the other hand. Redbubble notes that its manual searches identified the Rahandukan uploads on 10 August 2021 and COT had removed them before 13 August 2021 when the applicant complained about them to the Court and Redbubble.

171    Redbubble became aware of the Rakonsisten uploads on 13 August 2021 by reason of the complaint letter from the applicant’s solicitors to Redbubble’s solicitors and to the Court in seeking to bring the matter before the Court for relief. Redbubble explains that in the period Examples 8 to 11 were on the website, no goods bearing the substantially identical, or deceptively similar, images were ordered or shipped.

172    Redbubble provided all of the activity logs concerning access to its website for the period 1 August to 13 August 2021 to an expert, Mr McKemmish. Each row of the spreadsheet has been given a reference number. The spreadsheets were the subject of oral evidence and were referred to reasonably extensively in the course of oral submissions. The spreadsheet shows that the first access to the website (apart from the conduct of the uploader in uploading each image to the website) seems to be from a German internet protocol address, followed by an Australian IP address. It seems to be accessed by Mr Nelms through two particular networks one of which has a German IP address and one with an Australian IP network address. The various rows of the spreadsheet show that most of the access to the website is from Mr Hansen. It occurred initially through an iPhone but principally took place through a Macintosh computer from an IP address designated as the “Main Brisbane address”.

173    Redbubble says that Mr Hansen’s access to Examples 8 to 11 occurred as a result of being “coached and directed by Mr Nelms” to the particular webpages. Redbubble contends that before Mr Hansen saw any of Examples 8 to 11 as a result of conducting the searches of the website he describes in his evidence, he had already seen at least the Rakonsisten uploads by being sent a direct link to the webpage bearing the image, by, it is said, Mr Nelms.

174    I am willing to accept that Examples 8 to 11 were likely identified by Mr Nelms; that he advised Mr Hansen of the examples and suggested that he ought to search for them to see if they were accessible in Australia from the Redbubble website; that Mr Nelms likely sent Mr Hansen a link to the images. I also accept that Mr Hansen undertook the searches he described. I accept that Mr Nelms “spent some time over a period of approximately seven hours (with various breaks throughout totalling 4.5 hours)” on the website looking for offending images which he ultimately found in the form of the images at Examples 8 to 11, all of which exhibit the words “Hells Angels” in the semi-circular rocker above the profile image device of the winged death head, with a different word in the lower rocker in each example.

175    I also accept that a small percentage of persons (perhaps 1.8%) conducting searches of the Redbubble website use the filter “Newest”. Redbubble contends that using this filter is therefore “highly unusual” and not something an ordinary consumer would seek to do. The inference Redbubble seeks to draw is that having found the offending images by adopting an unusual filter and search strategy, Mr Nelms kept links to the images available to him on one or more devices (which seems to include two Macintosh computers and an iPhone), the spreadsheet showing regular access to direct links. Thus, Mr Nelms was able to send direct links by email or text to Mr Nelms. Redbubble says that Mr Nelms also provided a direct link to Mr Bolam to Example 9 (in the form the image would appear as if on a t-shirt). Although Mr Bolam describes the searches he made as mentioned earlier, he is criticised for not mentioning the transmission to him by Mr Nelms of a direct link to the offending Example 9 image. Mr Hansen accepts that Mr Nelms engaged in some “burrowing down” into the website and then provided him with a direct link to what Mr Nelms had found. The transmission of that link enabled Mr Hansen to go directly to the image. Redbubble contends that the Court can infer that shortly after Mr Hansen was sent the direct link, he was asked to conduct a search of the website for “Hells Angels” refined by the use of the filter “Newest” or “Most Recent”. In other words, the inference said to be open is that Mr Nelms “spent time” on the website, found the offending images, used the unusual filters of “Newest” or “Most Recent” to refine the search and then stepped Mr Hansen through the process he would need to undertake to reveal the offending images, on the website, in Australia, if those images were able to be accessed (as they were) and found through the website in Australia.

176    Redbubble contends that all of this industry and machinery of searching is not something an ordinary reasonable consumer would do and, in effect, even though the images had been uploaded to the site, they were rendered opaque by the difficulty of finding them.

177    There are a number of factors that need to be kept in mind in this context. First, Mr Nelms was a person with a particular interest in seeking to find out whether offending images were on the Redbubble website at any particular moment in time. His interest in doing so is in every practical and reasonable sense, entirely unsurprising. He knew that Redbubble had been found, once before, to have infringed the Hells Angels trade mark/s and the device trade mark and he had just seen seven further examples of use on the Redbubble website of images properly characterised as substantially identical with, or deceptively similar to, the relevant trade marks corresponding to the relevant seven examples. It would be natural for Mr Nelms to spend time on the website to see if further examples of offending images were present and accessible, just as members of COT could have done. Given the fact that there had already been a hearing concerning seven examples of offending images, it is not altogether surprising that Mr Nelms might have been looking for a means of isolating images uploaded to the website since the date of the uploading of the seven examples already in issue in the proceeding to see if there were further uploaded images. Mr Toy has previously given evidence that Redbubble itself adopts a methodology, similar in principle to “newest”, by doing a site sweep for a client which begins with a sweep from the date of foundation of the website to the present and thereafter doing sweeps from the date of the last sweep to the present. In other words, Redbubble recognises that seeking out something in the nature of the most recent uploadings or the newest uploadings is rational and relevant. Also, Mr Toy advises that some of the tags involve the terms “Newest” and “Most Recent”. Presumably, the technique of searching, through sweeps, for images uploaded since the date of the last sweep, is designed to avoid covering the same ground over and over again. Although a search by a sub-filter of “Newest” might be a statistically small sub-filter, there seems to be some rationality in asking the website to identify the newest uploaded images by reference to the search terms in issue.

178    I am willing to accept that Mr Nelms did undertake a degree of inquisitive forensic examination of the website and it is likely that having done so he told Mr Hansen of the outcome and provided him with links to particular webpages displaying the offending images. Why would he not do so? I accept that, in that likelihood, Mr Hansen went to those links and clicked upon them which then exposed the image to him. I accept that he then explored the website to identify the field of products to which the image might be capable of being applied whether clothing or articles or other things by a user subject to whatever choices they might or might not make.

179    Redbubble says that these steps are not the usual steps a reasonable consumer would take in searching the website.

180    Having considered all of these matters and Mr McKemmish’s evidence and the spreadsheets, the position seems to me to be this.

181    I accept that there is some force in the point Redbubble makes concerning the sequence of searches made by Mr Nelms and the enabling by Mr Nelms of Mr Hansen in the searches he undertook, but I do not accept that these matters are ultimately an answer to the claims of infringement made by the applicant. The truth of the matter is that the examples were uploaded to the website. They seem to have been uploaded by a serial offender. Redbubble acted quickly to deal with them but the images were on the site for the periods earlier identified and the images are an out and out taking of “Hells Angels” and the device. In other words, the problem presented itself again in relation to Examples 8 to 11. A consumer could have searched the website for images captured by the attractive force (to the relevant consumer in that milieu of club and motorcycle engagement) of the term “Hells Angels” or that term in conjunction with other search terms that revealed the images. The search results might have been refined or synthesised by such a user using a filter which took the user to a set of results which showed the newest or most recent uploaded images. I accept that a degree of industry or effort would have been necessary to ultimately result in a consumer clicking on a particular webpage exhibiting one or more of the four images. It should also be kept in mind that the website prompts reference to images that a user might like to look at having regard to the search terms and the fields engaged by the search. In any event, the offending images were on the website, in fact, and a consumer relevantly engaged by the force of seeking to find images so connected to his or her area of interest could have found the images, admittedly with some effort.

182    I accept that the images were on the website for a short time and that no purchases occurred. I also accept that seems to be the position that only Mr Hansen, in Australia, engaged with the images. In his affidavit material, Mr Hansen illustrates the offending images as they would appear had they been applied to a wide-range of goods. These examples are merely illustrations of a range of possibilities. They are not examples of goods offered for sale already marked with any one or more of the images nor are they examples of goods purchased by anyone to which the offending images were applied. They are merely illustrations of what was offered, through the website, to users as offending images which could be applied to goods for purchase even though the owner of the trade mark and its authorised user in Australia had not authorised anyone to upload the image to Redbubble’s website and nor had they authorised Redbubble to enable the possibility of sales of goods or articles bearing the trade marks of the registered owner and the trade marks the subject of the authorised user arrangements in Australia.

183    However, I am not satisfied that the contentions of Redbubble about the degree of industry which might be required to reveal the images is an answer to the infringing conduct of Redbubble. I am satisfied that as to two of the examples (Examples 8 and 10), they were removed from the Redbubble website before complaint was made by the applicant or its solicitors. In that sense, the problem presented by the uploading as to those two examples was addressed by Redbubble before the applicant’s intervention. Nevertheless, there were four further examples. I am satisfied that the injunction ought to go both in relation to Examples 1 to 7 and Examples 8 to 11.

184    As to the question of damages, the applicant says that it relies upon its submissions made in relation to damages and additional damages concerning Examples 1 to 7. The basis upon which Examples 8 to 11 were initially raised with the Court and then brought within the scope of the proceeding was that the matters were relevant to the question of the injunction (as four further examples of offending conduct), but more particularly because the four further examples were to be taken into account in an assessment of damages and additional damages on the basis of the submissions earlier made. However, another ground was raised very late in the day based upon the anger and hurt engendered in the applicant by reason of the use of the trade marks having regard to the importance the applicant attaches to the right to reserve use and application of the trade marks to clothing and other articles for sale to members. This additional notion was a new ground. In the re-opened case, there were no submissions in the course of opening about damages and there were no submissions on that topic other than a reference back to the earlier submissions made in the first phase of the case, and the new ground based on anger and hurt.

185    I now propose to address the question of whether a basis for damages has been made out.

186    Although it may seem a self-evident observation, damages are a form of relief for infringement of the registered trade mark(s). Infringement is itself a statutory concept (although the authorities describe the action for a remedy for infringement of a trade mark as a statutory tort), framed, relevantly here, in the terms of s 120(1) of the Act which concerns conduct engaging “use” in relation to goods or services in respect of which the trade mark is registered, where the impugned sign is, as it is here, substantially identical with, or deceptively similar to, the relevant trade mark in suit.

187    Use of a sign (of the kind described in s 120(1)), as use as a trade mark, engages use of the sign in a relevant relation to goods, through the website by reference to the spectrum of goods to which the trade marks might be applied (so far as those offered goods concern goods the subject of the relevant trade mark registration).

188    Redbubble, by offering users of its site in Australia the opportunity to inspect designs and select signs which are substantially identical with, or deceptively similar to, the relevant trade marks in suit and then select goods (the subject of the registrations) to which those signs might be applied, coupled with a sequence of steps which enable the transaction, cause the selected goods to have the sign applied, cause the transaction to be financially implemented, delivery effected, a fee paid to Redbubble and remuneration paid to the uploader, is use of the impugned signs as a trade mark in relation to the goods for which the relevant trade mark is registered.

189    I have already explained why the operation of the Redbubble website in the context of the business model gives rise to the infringements in these proceedings.

190    What damages flow from this conduct so far as the applicant is concerned?

191    This is not a case where the respondent has sold a wide-range of goods bearing the impugned trade marks. The transactions are those made by Mr Hansen as the purchaser. Mr Hansen undertook those steps to prove use by Redbubble of the relevant signs as part of Redbubble’s conduct within its business model. In this case, the evidence suggests that the trade marks in suit fall into that class of intellectual property which is reserved only for the use of members who are conferred with a right of use in the terms administered by HAMC US and, relevantly in Australia, HAMC AU.

192    The foundational authority which establishes the three well-known methodologies for calculating damages for infringement of an intellectual property right is Lord Wilberforce’s “magisterial survey of the principles relating to damages for patent infringement” in General Tyre and Rubber Co v Firestone Tyre and Rubber Co [1975] 1 W.L.R. 819 (HL). The description just attributed to Lord Wilberforce’s survey is that of the editor of the 21st Edition of McGregor on Damages, Sweet & Maxwell, Edelman J at [48-042]. Although the principles were developed by Lord Wilberforce in the context of patent infringement, they have been applied in copyright and design infringement cases and, relevantly for present purposes, cases concerned with infringements of registered trade marks.

193    One of the three approaches to the recovery of damages concerns that class of case where the owner of the intellectual property right (whatever its character might be) is not proposing to exploit the right itself. The other two approaches concern whether the owner of the right would have exploited the relevant right by manufacture and sale of goods or articles (the first method), or whether the owner would have allowed others (third parties) to exercise the right in return for a royalty or licence fee (the second method).

194    The third approach, most relevant in this case, where the rights owner would not have exploited the trade marks in suit except within the limits of the rights conferred upon members as described in these reasons consistent with the ethos and culture recognised by the rights owner and HAMC AU so far as Australia is concerned (and where the use of the trade marks in that context is closely controlled), nevertheless enables damages for infringing use by another to be assessed on the basis of a “construct”, that is, based on the price that would have been paid by a willing seller and a willing buyer which, in the authorities, is now described as a construct established between a willing (but not eager) seller and a willing (but not eager) buyer. The construct gives rise to what is described as the “hypothetical licence fee charge”, and the measure of that fee is usually struck as the value of the right to the unauthorised user of it.

195    In this case, however, the claim for damages is not put on this basis and no evidence of the hypothetical licence fee has been put before the Court based on the hypothetical construct.

196    Because infringements of intellectual property rights are made tortious by statute, the measure of damages is governed by similar considerations that govern the assessment of damages in tort.

197    In other words, damages are assessed so as to “compensate” the applicant for “loss and injury” suffered as a result of the respondent’s infringing conduct: see the authorities at [506] in Seafolly Pty Ltd v Fewstone Pty Ltd (2014) 313 ALR 41, Dodds-Streeton J; Kerley’s Law of Trade Marks and Trade Names, 16th Edition at [22-150] based on the principles derived from Gerber Garment Technology Inc v Lectra Systems Ltd [1995] R.P.C. 383, Jacob J at pp 393-395 (being principles identified by his Honour and not disturbed in the appeal from his Honour’s primary decision).

198    Loss or injury might arise in a number of ways and Lord Wilberforce has identified three ways a “money value” might be determined as compensatory of an applicant’s loss or injury in each set of circumstances contemplated by each of those methodologies. Even where damages cannot be assessed on the basis of the first two methodologies identified by Lord Wilberforce, or on the so-called “user hire” principle based on the hypothetical licence construct, damages might be able to be assessed on the basis of injury suffered by the applicant due to the “invasion of the monopoly”. One example of that approach, in principle, is National Guild of Removers & Storers Ltd v Jones [2011] EWPCC 4 at [14].

199    It seems clear enough that nominal damages may be awarded for infringement of the registered trade marks: Nokia Corporation v Liu (2009) 80 IPR 286 at [21], Jessup J; Halal Certification Authority Pty Limited v Scadilone Pty Limited [2014] FCA 614, Perram J at [89]. Apart from nominal damages, damage to the reputation subsisting in the trade marks is compensable. In Elwood Clothing Pty Ltd v Cotton On Clothing Pty Ltd (2009) 81 IPR 378 at [32], Gordon J (although the issue was not in dispute before her Honour) seemed to accept as orthodoxy the proposition that damage to reputation is a compensable injury if caused by the infringing conduct: see also GM Holden Ltd v Paine (2011) 281 ALR 406, Gordon J at [89].

200    Normally, damage to reputation arises out of trading conduct on the part of the respondent where such matters as the sale of goods of inferior quality under the infringing sign diminishes the standing of the trade mark as an item of personal property. An award of damages on the basis of reputational loss in the source of the intellectual property right (whether a copyright, registered trade mark, registered patent or registered design) arises on the footing of the depreciation in the value of the applicant’s (right) as a chose in action, resulting from the respondent’s infringing conduct.

201    One basis upon which the applicant’s damages case is put is analogically similar, in reliance on the observations of von Doussa J in Milpurrurru v Indofurn Pty Ltd (1994) 130 ALR 659 (“Milpurrurru”). Redbubble objects to these contentions of the applicant as the applicant did not open a case on damages in the resumed proceeding, and the case on damages in reliance on the observations of von Doussa J was not pleaded. The point the applicant seeks to make is this. In Williams v Settle [1960] 1 WLR 1072, Willmer L.J. at 1086-7 accepted that in assessing damages for infringement of the copyright subsisting in a series of wedding photographs, the primary judge did not err in having regard to the “distress” caused to the wife of the owner of the copyright (the husband) as part of the “injury” “suffered by” the plaintiff copyright owner by reason of the infringement. In Nichols Advanced Vehicle Systems Inc v Rees Oliver and Others [1979] RPC 127, Templeman J at 140 accepted, in the context of a claim of copyright infringement, that the “humiliation” “inflicted” on the plaintiff entity was properly a matter to be taken into account in assessing additional damages, in the context of essentially the same statutory formulation as that reflected in s 126(2) of the Act. Templeman J concluded at 140 that in the case of a flagrant infringement of the copyright where only minimal damages are available at law, “then additional damages will be so much more than they would be if the plaintiffs prove some damages at law and ask for a modest supplement”. In the circumstances of that case, Templeman J included a “moderate but not excessive sum” by way of additional damages.

202    In Milpurrurru, von Doussa J was considering a claim for damages under s 115(2) of the Copyright Act 1968 (Cth) (among other relief) for infringement of the copyright subsisting in the works of Aboriginal artists in circumstances where the respondents had reproduced their works in woollen carpets and had sold those carpets. Justice von Doussa accepted at 692 that the calculation of damages extended beyond the assessments of the “commercial potential for money return from the copyright” and “may include compensation for personal suffering, for example, for insulting behaviour” and for “humiliation”. Having regard to the authorities mentioned earlier, von Doussa J, in the context of the findings his Honour made, said this at 692:

In the present case, the infringements have caused personal distress and, potentially at least, have exposed the artists to embarrassment and contempt within their communities, if not to the risk of diminished earning potential and physical harm.

203    At 693, von Doussa J made these observations:

[I]n the cultural environment of the artists the infringement of those rights has, or is likely to have, far reaching effects upon the copyright owner. Anger and distress suffered by those around the copyright owner constitute part of that person’s injury and suffering.

204    In this case, the evidence does not establish “injury” to the applicant caused by the trade mark infringements, of the character of “humiliation” or “insulting behaviour” or “personal distress” in the nature of “embarrassment and contempt” of the kind suffered by the Aboriginal artists in their cultural environment. Moreover, the plaintiffs in Milpurrurru were the artists (all of the authors of the artistic works) directly affected by the conduct. In this case, the claim is made by an authorised user entity having struck particular arrangements with the registered rights owner. Plainly enough, Mr Hansen was irritated and angry that seven further examples of infringing conduct had been identified and then a further four examples, but that level of irritation or anger was expressed about the conduct itself not anger about any notion of degradation of the trade marks in any sense analogically similar to the circumstances in Milpurrurru or the other authorities mentioned earlier.

205    The evidence does establish that the trade marks are reserved for the use of the members on particular goods and subject to the approval of the rights owner and, where relevant, the applicant in Australia. The enabling of access to the trade marks, by Redbubble, to unauthorised third parties is a circumstance that needs to be kept in mind when assessing the character of the “injury” caused by the infringements but the character of that injury is not of the character contemplated by von Doussa J in Milpurrurru.

206    I propose to assess damages, subject to the s 126(2) question, in respect of the 11 examples of trade mark infringement on what I regard as the largely nominal basis of $8,250 in respect of all of them. I do so on the basis that neither of the first two methodologies identified by Lord Wilberforce have any application and as to the third methodology of the theoretical construct, the case is not put on that basis.

207    In that sense, it is difficult to identify in money terms, a value to be attributed to the loss or injury suffered by the applicant through the unauthorised use by the respondent of the trade marks in suit. Nevertheless, injury has been suffered because the trade marks have been used without the authority of the entity that enjoys, by an Act of the Commonwealth Parliament, on behalf of the citizens of Australia, the exclusive right to use the trade marks. Nor has Redbubble obtained, so far as Australia is concerned, the right of the authorised user, HAMC AU. The conferral or grant of exclusive rights by the Commonwealth Parliament on the registered trade mark owner and the class of rights conferred on the authorised user in Australia are not granted on the footing that a third party has a right to use the intellectual property rights subject to an option to pay damages provided a money loss (calculated on a methodology of the kind identified by Lord Wilberforce, for example) and where no such money loss arises according to those methodologies, no compensable injury arises. The rights owner is entitled to, at the very least, nominal damages, and in the case of all 11 infringements of the trade marks in the circumstances described in these reasons, nominal damages, in my view, amounts to $8,250.

208    I now turn to the claim for additional damages.

209    The statutory factors are set out at [114] of these reasons. For the sake of convenience, I will set them out here again:

(a)    the flagrancy of the infringement; and

(b)    the need to deter similar infringements of registered trade marks; and

(c)    the conduct of the party that infringed the registered trade mark that occurred:

(i)    after the act constituting the infringement; or

(ii)    after that party was informed that it had allegedly infringed the registered trade mark; and

(d)    any benefit shown to have accrued to that party because of the infringement; and

(e)    all other relevant matters.

210    Section 126(2) which provides for additional damages, was introduced into the Act by Intellectual Property Laws Amendment (Raising the Bar) Act (2012) Cth. The Explanatory Memorandum for the 2011 Bill at p 113 explains the purpose of the amendment to introduce s 126(2) in these terms:

This item amends section 126 to give a court the discretion to award additional damages if the court considers it appropriate to do so.

Additional damages (also known as punitive or exemplary damages) are available for flagrant infringement of patents, registered designs, and copyright. However, additional damages are not currently available for trade mark infringement. This limits the ability of a court to mark its disapproval of the blatant violation of the trade mark owner’s personal property rights under the Trade Marks Act.

Additionally, stakeholders have submitted that many counterfeiters do not maintain sufficient business records to enable a satisfactory calculation of ordinary damages or an account of profits: purely nominal damages may be regarded by counterfeiters as merely the “cost of doing business”, rather than an effective deterrent. …

The amendment remedies these problems by giving the court the discretion to award additional damages. This aligns the remedies for trade mark infringement with other forms of intellectual property. It permits the court to provide a substantial deterrent and to mark its disapproval of flagrant infringement.

Consistent with the additional damages provision in other IP legislation, the power to award additional damages is discretionary. The courts will therefore have sufficient flexibility to ensure that additional damages are only awarded in appropriate circumstances. In exercising its discretion, a court would have regard to all relevant matters. Consistent with the approach in the Patents Act, there is also a list of specific factors to assist the courts as to when it may be appropriate to award additional damages

211    In forming a view about whether an additional amount is to be included in an assessment of damages for the infringements, the following considerations should be kept in mind.

(1)    Section 126(2) does not require there to be proportionality between the assessment of damages under s 126(1)(b) and the amount (if any) included under s 126(2).

(2)    An amount considered appropriate to be included under s 126(2) in any assessment may reflect an element of penalty (even if only as a function of s 126(2)(b)).

(3)    The assessment may reflect an element of judicial disapproval of the conduct.

(4)    The statutory provisions include giving consideration to all relevant matters not just those at s 126(2)(a) to (d).

(5)    The Court is to have regard to the flagrancy of the infringement. The notion of flagrancy involves that which is “deliberate and calculated to injure” the rights of the party, or a “cynical pursuit of a benefit”: Geneva Laboratories Limited v Prestige Premium Deals Pty Ltd (No 5) [2017] FCA 63, Bromwich J at [80] (point 5).

(6)    The assessment of any additional amount takes into account the need to deter similar infringements of registered trade marks, and in this context, general deterrence is relevant. So too is specific deterrence.

(7)    Post-infringement conduct on the part of the respondent is to be taken into account. Section 126(2)(c)(i) asks, what did the respondent do after the acts constituting the infringing conduct occurred, or after it had been told of the allegedly infringing conduct.

(8)    Section 126(2)(d) asks what benefits has Redbubble derived because of the infringement?

212    In these proceedings, I am satisfied that it is appropriate to include in the assessment of what I regard as nominal damages under s 126(1)(b) an additional amount that takes into account the following matters.

213    In these proceedings, there are, in the first part of the case, seven further examples of infringing conduct. I have already explained and described in considerable detail the history of those infringements. I will not repeat those factual matters here. I take them all into account. I do not suggest, and nor do I find, that the infringements occurred as a result of a callous disregard of the applicant’s rights. I accept that Redbubble has taken a number of steps to adopt procedures to try and identify those occasions when, on its website, it has signs which infringe the trade mark rights of the applicant. However, the fact is that its business model enables the conduct. Redbubble seeks to address the conduct within the limits of its business model, but its business model brings about the conduct the subject of this proceeding. The applicant (and HAMC US, but relevantly here, the applicant), is entitled to expect and have Redbubble act according to law.

214    The applicant is entitled to expect Redbubble to honour the exclusivity of the grant to HAMC US and the rights the applicant enjoys as an authorised user.

215    Both the registered owner and the applicant are entitled to expect the respondent not to engage in conduct the Commonwealth Parliament has proscribed by s 120(1) of the Act.

216    Redbubble is not entitled to proceed on the basis that because its business model involves the management of a large digital platform, unfortunately, from time to time, infringements of the rights of others will occur and it will seek to proactively manage and moderate that circumstance as best it can according to the programs it puts in place from time to time. Redbubble has an obligation to act according to law and observe the rights conferred on others.

217    In this case, there are seven examples of infringement in the first part of the proceeding.

218    The examples have all occurred notwithstanding an earlier finding of infringement concerning another sign containing “Hells Angels” in the upper rocker configuration and the “device”. Yet, seven more examples have occurred exhibiting those features (in one or more examples). It is correct to say that they were moderated, but in fact they were not successfully moderated, in large part. Examples 2, 3, 4, 5 and 6 were examined and then virtually immediately returned to the website.

219    Thus, Redbubble’s outsourced moderation group residing in Jamaica failed not only the applicant but failed Redbubble. Redbubble’s experience of that failure was, in turn, a function of perceived limitations in the oversight or governance of the outsourced group. Mr Toy explains how outsourcing to that group was brought to an end and he explains the various improvements adopted by Redbubble as a result of that experience. I accept, as I have made plain, that evidence of Mr Toy.

220    However, the applicant is entitled to ask, why should Mr Nelms or Mr Hansen or Mr Bolam be called upon to surf Redbubble’s website from time to time looking for further examples of the same thing and then notify Redbubble of those further examples, as any one of Mr Nelms, Mr Hansen or Mr Bolam finds examples on the website requiring moderation?

221    Redbubble understands the precise content of the so-called “Reference Content”. It understands the source of the rights in issue and it knows through its COT and Legal Team and, no doubt, with the aid of its external lawyers, the legal tests to be applied in determining whether uploaded artworks are substantially identical with, or deceptively similar to, the registered trade marks.

222    I have described Redbubble’s proactive moderation processes and I take all of that evidence into account. I accept that many steps have been taken. Sometimes they isolate infringing content and that content is moderated. Sometimes those steps do not isolate infringing content. The evidence shows that moderation has failed in a number of examples but I accept that steps have been taken to try and solve that problem. Whilst the conduct on the part of Redbubble does not reflect an outright disregard of the rights of the applicant or HAMC US, the applicant’s rights nevertheless continue to be infringed and are disregarded, in the sense that seven more examples have emerged notwithstanding the applicant having taken proceedings to trial and obtained an order previously in relation to a sign which also included “Hells Angels” in the upper rocker configuration and the same device described as the profile view of the winged death head.

223    The conduct needs to be deterred as a matter of recognising that a court cannot accept that infringements will be allowed to occur as a necessary, but unfortunate part of, the complexity of the working of the respondent’s business model.

224    Thus, general and specific deterrence remain an element of the considerations.

225    General deterrence is a necessary part of the assessment as infringement of registered trade marks must be discouraged in circumstances where the very applicant has once been to court bringing proceedings against the very same respondent in respect of a very similar class of conduct.

226    Additionally, the particular defendant must be specifically deterred.

227    Apart from the seven examples the subject of the first part of this proceeding, four further examples (Examples 8 to 11) were uploaded to the website which are properly described as substantially identical with, or deceptively similar to, the relevant trade marks in suit. These examples are another four examples of “out and out taking” of the relevant trade marks. Some of them may have been taken by serial offending uploaders. In any event, they found their way to Redbubble’s platform for use by users through the functionality inherent in Redbubble’s website. I accept that two of the examples were identified and moderated by Redbubble before it became necessary for the applicant to agitate the uploadings so as to have them taken down. In that sense, Redbubble’s self-regulation identified the offending uploads and dealt with the problem of any continuing presence of those images on the website. They had, of course, been on the website for a short time. As to the other two, the applicant identified them through the activities of Mr Nelms and then Mr Hansen and ultimately Mr Bolam. All four of these additional images, Examples 8 to 11, were on the website for the periods earlier explained in these reasons. I accept that the circumstances of the first seven examples are of a different kind to the circumstances of the four further examples. However, the fact remains that four further examples managed to make their way to the site for a period of time. I simply take the circumstances of the four further examples in their entirety as described earlier in these reasons into account in seeking to reach an overall synthesis of the factors relevant to the question of whether an additional amount ought to be incorporated in the damages assessment. The four further examples do not add very much to this question, in my view. They remain relevant to the question of infringement but, in my view, the question of whether an additional amount ought to be imposed is largely determined by the circumstances relating to the additional seven examples.

228    There is one aspect of the four further examples which needs to be kept in mind. In answer to the concern agitated by the applicant that the four further examples were on Redbubble’s website for the limited period of time of the uploading, Redbubble contends that Mr Nelms found it necessary to burrow through the website for some time to find these examples and no consumer would have undertaken that conduct or would have been able or inclined, in all probability, to persevere as Mr Nelms did and find all or any one of the examples. The difficulty with this notion is that Mr Nelms was able to spend some time on the site and find these examples. It would have been open to Redbubble with its very sophisticated knowledge of the functionality of its own digital platform to have assigned someone on a regular basis (perhaps once each fortnight or once a month or on some other basis) to examine the website deploying the skill sets such a person within Redbubble would have, in much the same way as Mr Nelms did (although, no doubt, at a higher level of forensic skills), and see whether there are any further examples entering onto the Redbubble website of “Hells Angels” or the device of the profile view of the winged death head, or both and then disable the webpage. In circumstances where there have already been proceedings once resulting in infringement and orders, seven further examples of infringement with an unfortunate experience of failed moderation through the Jamaica TPSP, Redbubble might prudently have deployed a person to undertake the forensic searches just described expressly for the purpose of managing its obligation to ensure that it acts according to law through its website.

229    Two other things should be mentioned.

230    I accept that the cost of addressing infringements of the applicant’s trade marks ought not to be regarded as a cost of doing business.

231    I also accept that Redbubble has derived very little financial benefit at all from the conduct.

232    It seems to me that in reaching an instinctive synthesis of all of these considerations, an appropriate amount under s 126(2) to be included in the assessment of damages under s 126(1)(b) is $70,000 and thus, the assessment under s 126(1)(b) will be $78,250.

233    The applicant has been successful in both parts of the proceeding. Declarations will be made as to the infringing conduct. Injunctions will be framed in relation to the conduct. Damages will be awarded of $78,250. The question of the costs of the separate proceeding have been determined by Jagot J. Apart from those costs, the applicant is entitled to an order for the costs of and incidental to the proceeding having been successful on the merits in the proceeding.

Associate:

Dated:    19 July 2022

ATTACHMENT “A”

Trade marks in suit

4.    Australian Trade Mark No. 526530:

(a)    for the words HELLS ANGELS and MC

(b)    for the image of a face, profile with winged helmet appearing as follows:

(c)    registered in Class 16 in respect of printed matter; bookbinding material; photographs; printers type.

(d)    has the priority date with effect from 8 January 1990.

5.    Australian Trade Mark No. 723219:

(a)    for the words HELLS ANGELS.

(b)    registered in Classes 9, 12, 14, 16, 25, 26, 28 and 41 and relevantly registered in:

i.    Class 16 in respect of printed matter including magazines, pamphlets and brochures, labels in this class, flags in this class, instructional and teaching material (except apparatus), playing cards, stationery including pens and posters.

ii.    Class 25 in respect of clothing including leather belts and jackets, footwear and headgear; headbands and armbands not being made of leather and being goods included in this class.

(c)    has the priority date with effect from 2 December 1996.

6.    Australian Trade Mark No. 723463:

(a)    for the image of a face, profile with winged helmet appearing as follows:

(b)    registered in Classes 9, 12, 14, 16, 25, 26 and relevantly registered in:

i.    Class 16 in respect of printed matter including magazines, pamphlets and brochures, labels in this class, flags in this class, instructional and teaching material (except apparatus), playing cards, stationery including pens and posters.

ii.    Class 25 in respect of clothing including leather belts and jackets, footwear and headgear.

(c)    has the priority date with effect 5 December 1996.

7.    Australian Trade Mark No. 1257992 (IR 971196):

(a)    for the words HELLS ANGELS.

(b)    registered in Classes 14, 16, 25, 26, 41 and relevantly registered in:

i.    Class 16 for printed matter, newspapers, periodical publications, books, photographs, stationery and adhesive materials (stationery); paper, cardboard, paper articles and cardboard articles, book-binding material, artists' materials, paint brushes, ordinary playing cards; printers' type and cliches (stereotype); all included in this class.

ii.    Class 25 for articles of clothing, footwear and headwear, including coats, jackets, trousers, overalls, shirts, pullovers, sweaters, hats, vests, waistcoats, cardigans and belts (for wear).

(c)    has the priority date with effect from 11 July 2008.

8.    Australian Trade Mark No. 1257993 (IR 971198):

(a)    for the image of a face, profile with winged helmet appearing as follows:

(b)    registered in Classes 14, 16, 25, 26, 41 and relevantly registered in:

i.    Class 16: for printed matter, newspapers, periodical publications, books, photographs, stationery and adhesive materials (stationery); paper, cardboard, paper articles and cardboard articles, bookbinding material, artists' materials, paint brushes, ordinary playing cards; printers' type and cliches (stereotype); all included in this class.

ii.     Class 25 for articles of clothing, footwear and headwear, including coats, jackets, trousers, overalls, shirts, pullovers, sweaters, hats, vests, waistcoats, cardigans and belts (for wear).

(c)    has the priority date with effect from 11 July 2008.

9.    The trade marks in suit are and were at all relevant times registered, subsisting and in full force and effect.

ATTACHMENT “B”

Example 1

Example 3

Example 4

ATTACHMENT “C”

Example 1

Example 2

Example 3

Example 4

Example 5

Example 6

Example 7

ATTACHMENT “D”

ATTACHMENT “E”

[2] to [5] of 2019 judgment

1    The Redbubble website enables an artist (or for that matter, a non-artist who might simply be a person seeking to appropriate another person’s works or trade marks for commercial gain, subject to Redbubble’s contended protocols governing the operation of the website so as to manage the conduct of such persons), to upload an image, drawing, photograph, design, name, mark or sign or any other expression of creative (or non-creative) work to the website. The artist nominates the class of goods to which the work can be applied (selected from Redbubble’s pre-determined list of available products, for example, T-shirts, caps, mugs) and the website enables consumers to search, by tags or keywords, and transact so as to order and pay for, through the website, a selected article bearing the work.

2    The Redbubble website causes a third party fulfiller to be appointed (from a panel preselected by Redbubble) to fill the order by applying the image (or relevant subject matter) to, for example, a mug or a T-shirt.

3    The functionality of the Redbubble website also enables the despatch and delivery of the article with the work applied as ordered, to the buyer’s nominated address.

4    Redbubble says that it acts as the “agent of the artist” in enabling the transaction through its website. Redbubble says that in doing so, and in operating the Redbubble website generally, it is simply providing an open, online, electronic marketplace where artists and consumers can engage and transact with one another.

[164] to [169] of 2019 judgment

1    As to the background matters concerning the “business model” deployed by Redbubble and the role of the various Redbubble entities, the evidence of Mr Martin Hosking should be noted before returning to Mr Kovalev’s evidence concerning the functionality of the Redbubble website.

2    Mr Hosking is the Managing Director (“MD”) and Chief Executive Officer (“CEO”) of Redbubble Limited. He has been the MD and CEO since June 2010. He is on the Board of Redbubble USA and Redbubble UK. Mr Hosking was one of the founders of the Redbubble business in 2006 (as a proprietary limited company) together with his co-founders, Peter Styles and Paul Vanzella. The business model adopted by the founders is described by Mr Hosking as based on the “idea of an online marketplace” where “artists and designers would be the primary customers”. The founders decided to “combine” their “new concept” with the technology they had already developed for a “‘print-on-demand’ personalization service for customers who wanted to purchase a product with an image or word they had created”. The “online marketplace” combined with the “personalization service” technology would enable artists to “upload and sell their designs”: Hosking, affidavit, 28 July 2017, paras 7, 12, 16-18.

3    The Redbubble website was launched on 2 February 2007. It has operated as the “primary platform” for the Redbubble business model “ever since”. The domain name was acquired by the first respondent in 2006 as the “primary brand and domain” for the business model. Mr Hosking gave evidence that although Redbubble operates under the URL redbubble.com, there are “separate sites” for users in, for example, Germany, France and Spain. The German site is redbubble.de (a German language site). There is also a site redbubble.com.au. If a user or consumer types that site description into an internet search engine, that site will “redirect” the inquirer to redbubble.com: T, p 295, lns 35-47; 296, lns 1-10. Mr Hosking says that the Redbubble website, from the outset, enabled artists to: sell directly to customers; maintain the copyright in their work; regulate their own margins; and choose which products would be sold bearing their artworks. Mr Hosking accepts that the Redbubble business model limits the artist to selecting products identified by Redbubble to which the artist’s work might be applied. It does not enable an artist to select “any product”, use a third party manufacturer of choice and sell through the Redbubble website: T, p 297, lns 17-23.

4    When the business commenced, arrangements were made with only one fulfiller to discharge the role of a fulfiller (explained later in these reasons) under the model. Mr Hosking says that it quickly became clear that fulfillers in the United States would be needed. Expansion meant that other entities were needed. Moreover, operations could no longer be conducted solely from Melbourne in Australia. Redbubble USA was incorporated in 2007 as a subsidiary of Redbubble. Since then, Redbubble USA “has been primarily responsible for worldwide sales, marketing and logistics operations”. Although Redbubble UK was incorporated as a subsidiary to undertake that role in Europe, it has never done so. Redbubble USA performs that role in relation to Europe, as well.

5    In 2010, Redbubble “overhauled the look and feel” of the website. Some of the changes allowed users to refine searches of the site by multiple criteria including product type, colour and category. The layout of search results was altered. New product styles were added. The ability of artists to upload their works was improved along with the capacity to track sales. Also, artists were provided with an opportunity to market their artwork on social media.

6    In 2009, Redbubble decided to restructure its outsourced infrastructure arrangements. From 2006 to 2009, the Redbubble website operated on servers physically located in Australia, in Melbourne, at an IT facility “hosted” by a third party. In late 2009, Redbubble commenced a process by which all information including artists’ accounts and images uploaded by them to the site were “transferred electronically to different hard drives and CPUs physically located in the United States of America [USA]”. Mr Hosking says that this step was necessary because the majority of Redbubble’s website customers, both artists and end-customers, were located in the USA. Mr Hosking says that the location of the customers made it more “cost effective” to utilise servers located in the USA and it also meant that the protocols governing “Google” would recognise the Redbubble website as a USA site which “improved our rankings from US customers in search results”.

[198] to [247] of 2019 judgment

1    Mr Kovalev explains that the domain name redbubble.com is registered in the name of the first respondent. Mr Kovalev accepts that redbubble.com is an “asset” of the first respondent: T, p 214, lns 16-33.

2    Mr Kovalev says that the day-to-day management of the Redbubble website (including aspects of its design and updates) is carried out by Redbubble USA which is based in San Francisco. Redbubble USA is also responsible for marketing activities and the management of “third party fulfillers” and “shippers”.

3    Mr Kovalev says that the Redbubble website is “a global online marketplace facilitating transactions between independent artists and customers looking for distinctive products”. He says that independent artists are individuals who produce art and designs on their own and not as part of any organisation. He says that the aim of the Redbubble website is to provide “a forum where “independent artists” can upload their creative works and offer them for sale on a wide variety of products”. He explains that when a customer places an order through the website, a product is then produced on demand by one of a network of third party fulfillers. Mr Kovalev then explains a sequence of activities. These activities are said to take place from the “Redbubble group’s side of the transactions, in a completely automated fashion with no, or virtually no, human intervention on the part of the Redbubble group”.

4    The activities are these.

5    The signing up of artists (and where applicable, customers); the indexing of artworks; receipt of orders; facilitation of transactions; communications with suppliers relating to transactions; and all despatch and billing, is controlled by the Redbubble group’s software system. Mr Kovalev says that all of these activities are, for the most part, “completely automated”, “with very little human intervention”: T, p 207, lns 23-32. These software systems are described as a suite of various “bespoke applications written by Redbubble group staff and contractors”.

6    These applications are executed on servers located in the United States of America.

7    The suite of programs making up the applications which execute on these servers in the United States are described by Mr Kovalev as the “Redbubble Software”. That term means: applications described as Imagehaus and Magickraum which perform the imaging functions described in Mr Kovalev’s evidence mentioned later in these reasons; and software called Redbubble which is an application used for the signing up of artists; indexing artworks and searching for titles and tags in relation to those artworks; receipting orders from customers; facilitating transactions; and facilitating communications with suppliers. Mr Kovalev gives evidence, mentioned later in these reasons, about all of those matters concerning the Redbubble application.

8    As to the way in which an artist might engage with the Redbubble website, Mr Kovalev gives the following evidence.

Artists

9    Third parties who wish to offer their artwork for sale on the Redbubble website must first “sign up for an account”. The process for signing up for an account requires artists engaging with the website to click the “Get Started Now for Free” button on the “selling page” of the website. The artist then enters an “account name” which will feature at the end of the Uniform Resource Locator (“URL”) [www].redbubble.com/people/[account name], together with the artist’s email address and a password. The artist then is required to click the button “Sign Up Now!” Immediately above that button is a disclaimer statement that reads “By clicking Sign Up Now, you agree to our User Agreement”. I will return to aspects of the Redbubble User Agreement later in these reasons.

10    Mr Kovalev says that artists engaging with the Redbubble website may be located anywhere in the world.

11    Only once an artist has created an account on the site and accepted the terms of the Redbubble User Agreement, is the artist able to upload an artwork to the site through the enabling functionality of the site. As to uploading an artwork, an artist must click the “Add New Work” button located at the bottom right-hand corner of the “account landing page”. The artist must then click the “UPLOAD TO ALL PRODUCTS” button on the “upload page”. The artist must then “browse their computer through the pop-up window on the Redbubble Website and select a high resolution image for the upload”. Mr Kovalev says that the pop-up window is presented to the artist after the artist has pressed the “upload to all products” button: T, p 209, lns 1-3. Having pressed that button and having engaged the pop-up window, the words “open” appear. The pop-up window, in Mr Kovalev’s example in evidence, is generated by the user’s browser (internet explorer) which presents the “open” button. Once the user clicks “open”, that step commences the process for uploading an image. However, Mr Kovalev accepts that “you only get to that point of the browser by going through the Redbubble [website] pages [as described earlier]”: T, p 209, lns 15-28.

12    The website enables artists to upload images to the site in a number of different ways depending upon the device they are using. Artists can upload images from a computer, laptop, tablet or smart phone.

13    Mr Kovalev says that even though an artist may be located in Australia, the images selected by the artist for uploading to the site “may be stored outside of Australia, for example on a cloud storage service”. When the artist clicks “open” and takes the step to upload the artwork, the image is uploaded to one of Redbubble’s servers. Mr Kovalev says that “cloud services” allow artists to store data in third party data centres that may be located far from the artist. As to the term “cloud computing”, Mr Kovalev attaches 20 pages drawn from a Wikipedia entry for “cloud computing” which he says explains the elements of that term. Thus, Mr Kovalev embraces the Wikipedia description of the elements of that term.

14    In simple terms, cloud computing is a shorthand description for a sequence of links between computers, networks of computers and servers which enable storage and access to data. Every device so linked has a unique number which identifies the device, computer, server etc. It is sufficient to simply quote this section of the Wikipedia entry embraced by Mr Kovalev:

Cloud computing is a new form of Internet-based computing that provides shared computer processing resources and data to computers and other devices on demand. It is a model for enabling ubiquitous, on-demand access to a shared pool of configurable computing resources (e.g., computer networks, servers, storage, applications and services), which can be rapidly provisioned and released with minimal management effort. Basically, Cloud computing allows the users and enterprises with various capabilities to store and process their data in either privately owned cloud, or on a third-party server in order to make data accessing mechanisms much more easy and reliable. Data centres … may be located far from the user – ranging in distance from access to a city to across the world. Cloud computing relies on sharing of resources to achieve coherence and economy of scale, similar to a utility (like the electricity grid) over an electricity network.

15    Mr Kovalev gives an example of cloud computing in these terms:

Example: A Sydney-based artist could upload an image of their artwork from their Cloud service. The image is stored by the Cloud service on a server located in California.

16    Mr Kovalev says that Redbubble USA does not have “any visibility over where images uploaded by Artists have been sourced from”. By this I assume that Mr Kovalev means that staff of Redbubble USA do not know the source of an image uploaded by a user, wherever that user may be located in the world.

17    Mr Kovalev says that images uploaded to the Redbubble website by artists in the way he describes are automatically saved to a server operated by “Amazon Web Services” called the “S3 Service”. The server, so operated, is located physically in North Virginia in the United States of America (the “AWS Server”).

AWS Server

18    Mr Kovalev explains that the “Redbubble Software” (Mr Kovalev’s term as earlier mentioned) consisting of the suite of programs executing on servers located in the US, causes copies of the original image stored on the AWS Server to be “displayed” on the Redbubble website in “different sizes”. Mr Kovalev says that the “original image” uploaded by the artist according to the process earlier explained is “never displayed on the Redbubble website”. The Redbubble Software used to create a copy of an image is source code written by employees of the respondent Redbubble and is “executed” on servers located in the United States. Mr Kovalev accepts that before an artist’s “original image” is automatically saved to the AWS Server, the “process [of uploading] requires the artist to interact with the features of the Redbubble website [that is], with the buttons on the Redbubble website”: T, p 210, lns 1-5.

19    Mr Kovalev accepts that if an artist engages with the Redbubble website (redbubble.com) so as to upload a work, the artist will be confronted with buttons to click (or not) located on the Redbubble website and unless the artist goes through that process (of responding to those buttons), the artist “cannot get [his or her] artwork displayed on the Redbubble website”: T, p 210, lns 38-46; T, p 211, lns 1-2.

Further steps by artists

20    Mr Kovalev says that at any time after an artist has uploaded his or her artwork or image, the artist is able to select which products he or she would like to offer to consumers for sale and purchase as products to which the artwork or image might be applied, by selecting possible products from a list of available products as determined by Redbubble. The artist makes a selection by “enabling” or “disabling” products from the list of available products. An artist can also edit the way in which an artwork is applied to each product by, for example, altering the orientation of the image or selecting a background colour for the image. If an artist does not specify any products to which their artwork might be applied for sale, users will not be able to purchase a product bearing that artwork and the artwork will not “show up” in response to searches of the Redbubble website by consumer users. Mr Kovalev says that the sale of any artwork applied to any particular product is entirely at the discretion of the artist.

21    Once an artist has uploaded an artwork to the site, the artist may also select a title for the artwork; write a description of the artwork; select one or more “tags” for the artwork; and select the relevant “media category” (or categories) which accurately describes their work. The categories are photography; design and illustration; painting and mixed media; drawing; and digital art. The artist may also select a “default view” of the artwork which can either be the artwork alone or an image of the artwork as applied to any one of the available products (as an illustration); decide if the artwork is available to be viewed by the public; and specify whether the artwork contains any “mature content”.

22    As to the selection of one or more “tags”, tags are key words to which searches of the Redbubble website will respond. For example, if the artwork is an image of an “ocean pool”, the artist might create tags for that work consisting of “ocean”, “pool” and “water”.

23    Once the artist has uploaded their artwork and worked through all of the things described at [215] to [219] of these reasons, the artist can make the artwork available for sale by clicking the button “Save Changes” on the “artwork landing page” and by entering their payment details. Immediately above that button is a disclaimer in these terms:

When a product is sold through the website the sale is between you and the customer – Redbubble acts as your agent in this process. In order to act as your agent, we need your explicit permission.

[emphasis added]

24    Just below the disclaimer, there is a “check box” next to the words: “Yes and I agree to the Redbubble User Agreement”. The words “User Agreement” are hyperlinked to a full text copy of the User Agreement. Artists must agree to the Redbubble User Agreement before they can complete their profile. They cannot deselect the check box.

25    If an artist experiences technical difficulty in uploading an artwork to the Redbubble website, they can find solutions on the “Common Uploader Problems” page found in the “Help Centre” of the website. If problems persist other steps are suggested on the website. Alternatively, an artist can contact Redbubble’s “Artist Experience team” by taking steps through the website by clicking particular prompts and buttons. The Artist Experience team established by Redbubble consists of four people located in the San Francisco office and one person in the Melbourne office. In engaging with an artist in addressing any such problems the Artist Experience team seeks an explanation from the artist of the problem; asks for details about the web browser used by the artist when uploading and details of firewalls; details of the artist’s ISP; the method of connection; the country from which the artist is seeking to upload the artwork; and the artist’s internet protocol address (“IP address”).

26    In all of these things, Redbubble’s team seeks to help and facilitate the successful uploading of the work to the site.

The terms

27    As to the terms upon which artists make their work available for sale, Mr Kovalev says this.

28    The retail price charged to customers for the physical product featuring an artwork uploaded by an artist is made up of a Fulfiller Fee; a Redbubble Fee; a Creator Margin; and any relevant sales tax. The Fulfiller Fee and the Redbubble Fee are referred to in this methodology as the Base Amount. These terms are central to the pricing methodology about which Mr Kovalev gave evidence. The Creator Margin is the artist’s selected margin being a percentage mark-up of the Base Amount. The website contains a default Creator Margin of 20% but artists can choose any percentage mark-up of the Base Amount in the range 0% to 100%.

29    As to the Base Amount for each product type on the website, it is made up of the Redbubble Fee and the Fulfiller Fee. Mr Kovalev says that the Redbubble Fee is a service fee that Redbubble charges for “hosting” the marketplace and “facilitating the transaction” between the artist and the buyer of the product bearing the work. The phrase “facilitating the transaction” includes putting orders through to fulfillers (and Mr Kovalev accepts that artists do not organise the fulfillers): T, p 215, lns 27-33. The Redbubble Fee includes the cost of delivery to the customer’s nominated address: T, 215, lns 45-47. As to the relationship between the artist and Redbubble, Mr Kovalev does not agree that the artist provides the artwork and Redbubble provides the products and services although he does accept that the artist certainly provides the artwork and then the fulfiller manufacturers the product, and that is the product sold to the customer: T, p 216, lns 7-25. The Fulfiller Fee is the “manufacturing fee” charged by the relevant third party fulfiller whose job is to apply the artwork to the relevant product. The retail price charged to a customer is the Base Amount made up, as described, plus the Creator Margin selected by the consumer.

Consumers as users and customers

30    Mr Kovalev gives the following evidence concerning the mechanisms by which a consumer might become a customer of a product bearing an artist’s artwork, through the website.

31    Customers can purchase products through the Redbubble website with or without creating an account. If a customer wishes to create an account, he or she can do so by clicking the “Sign Up For Free” button and then signing up for an account much in the same manner as artists do as earlier described. When a customer signs up, the customer must also agree to the Redbubble User Agreement.

32    When a customer performs a search on the Redbubble website, the Redbubble Software will “trawl the Redbubble Website for tags and titles that match the search terms”. The Redbubble Software creates an “inverted index” which Mr Kovalev explains as operating in this way: “instead of storing information as ‘artwork [that] has these keywords’, it stores information as ‘keyword matches [to] these artworks’”. The inverted index enables “fast lookups”. The “keywords” are generated from the “tags” and “titles” chosen by the artists. The description an artist provides when uploading their artwork is not used to generate results in response to keyword searches. Mr Kovalev says that Redbubble does not select or generate any of its own keywords. The Redbubble Software will only match tags or titles containing the exact word or words which are used in the search term entered by a customer. Mr Kovalev gives this example:

Example: A customer searches the tag “elephant”. The software will return results for all artworks that have the tag “elephant”, or contain the word “elephant” in their title.

33    As the Redbubble Software matches tags or titles as determined by the customer, results are displayed in order of relevance to the search terms used. The Redbubble Software determines the “Most Relevant” works by producing a sorted list of artworks which matches the search terms. The sorted list is then “re-ranked” based on “business metrics” such as “sales, homepage feature and product compatibility”. For example, if a user performs a search for “elephant T-shirts”, the software will only display works if they are available for application to a T-shirt. Mr Kovalev illustrates this general principle of re-ranking in this way:

Example: If two items in the initial list of results have the same score in terms of their match with the search term, but the second ranked item has had more sales than the first ranked item, the items will be re-ranked, and the second ranked item will move to first position in the results set.

34    Mr Kovalev says that customers also have the option of sorting the results by “Top Selling” which will rank the products in order of the most recent sales, or sorting by “Recent” which will rank the artworks in descending order based on the date of upload by the artist. The Redbubble Software can also generate “related searches” that might be relevant to the customer on the basis of the keyword they have selected in their search. For example, if a user enters the keyword “bulldog” in a search, the Redbubble Software will return all artworks where an artist has used the word “bulldog” in the title or as a tag, but also identify other tags used by other artists who have chosen the word “bulldog” as a tag for their artwork and list the most commonly used other keywords in order of frequency as a related search. Mr Kovalev gives the following example:

High quality Bulldog inspired T-Shirts, Posters, Mugs and more by independent artists as designers from around the world.

Related searches: French Bulldog, Pet, Puppy, Cute, Animal, Dogs, Frenchie, Funny, French, Pets, and Love Gifts & Merchandise.

All orders are custom made and most ship worldwide within 24 hours.

Search results and related search terms are automatically generated from information provided by users.

Placing an order

35    As to placing an order through the Redbubble website, Mr Kovalev says this.

36    If a customer wants to purchase a product featuring an artwork uploaded by an artist, the customer must: select an artwork/product featuring an artwork from the search results page; select the size and/or type of the product and click “Add To Cart”; click “View Cart” and confirm the quantity of the product; select their “Shipping Option” and then click “Checkout”; choose to pay by PayPal or credit card; enter the shipping address and PayPal or credit card details; and then click “Pay”. Immediately above the “Pay” button is a disclaimer that reads:

By clicking pay, I agree to Redbubble’s User Agreement.

37    The words “User Agreement” are hyperlinked to a full copy of the User Agreement.

38    Upon clicking “Pay”, the customer will be redirected to a confirmation page setting out the details of the customer’s order, including an estimated delivery date. Shortly after clicking “Pay”, the customer will receive a confirmation email from [aboutmyorder@redbubble.com], setting out the details of the order and providing an order tracking number. Mr Kovalev says that this is an automatically generated email sent from the AWS Server to the customer via a third party email service called Sendgrid. Just as in the case of the artists, buyers must interact with features of the Redbubble website before their order is processed (T, p 211, lns 20-23) ultimately clicking the “Pay” button feature on the Redbubble website to go through the process of buying the product to which the artwork is applied: T, p 211, lns 32-45.

Fulfilling an order

39    Mr Kovalev says that the mechanism by which a customer’s order is fulfilled, is this.

40    Customer payments are processed by third party payment processors on servers that are not owned or otherwise used by the Redbubble group. Upon confirmation of a customer payment, a job is created on the AWS Server which generates what Mr Kovalev calls the “digital assets” required to fulfil the customer’s order. The digital assets include the customer’s address; the order number; the product type and style; the quantity ordered; the shipping method; and a “content file” containing “a copy of the image file for the artwork uploaded by the Artist, or a URL link to that file”. Mr Kovalev says that the Redbubble Software sends “a special URL” to third party fulfillers which the fulfiller uses to download the “digital assets”. For a small number of fulfillers, the digital asset files are sent by the Redbubble Software to the fulfillers “FTP server”. The term “FTP” stands for “File Transfer Protocol” which is a standard network protocol used for the transfer of computer files from a server to a client.

41    No company within the Redbubble group manufactures, warehouses, despatches, receives or distributes any physical products ordered using the process just described. Third party fulfillers receive orders placed by customers through the Redbubble website. They are responsible for the production and delivery of products to customers. The customer’s address might be anywhere in the world. There are, presently, 15 third party fulfillers filling orders placed through the Redbubble website and those fulfillers are located in: the United States of America; United Kingdom; Australia; Belgium; Hong Kong; and the Netherlands.

42    When a third party fulfiller is notified of a new order, the third party fulfiller will proceed to manufacture the ordered product. This involves printing the relevant artwork onto the product or otherwise producing or manufacturing the product. The third party fulfiller is automatically chosen by the Redbubble Software based on the product type and the customer’s nominated delivery address. Once the product has been manufactured, the software used by the third party fulfiller will send an “API request” to the Redbubble Software when the order is ready for shipment. The term “API” stands for “Application Programming Interface” and is a set of “protocols and tools for building software and applications”. An API request is a request to a “resource” on a server which is “exposed via an API”. Mr Kovalev gives this example:

Example: When an individual downloads an application to their smart phone, enters their registration details on the application and presses “Register”, this is usually executed via an API request.

43    When the Redbubble Software receives the API request, it will automatically generate an email containing order details as well as the shipping details. This email is then sent to the customer via Sendgrid. Once the customer receives the final product, the transaction is then regarded as “concluded”.

44    The process of fulfilling an order commences on the Redbubble website by the customer completing a purchase by clicking the “Pay” button on the website. When that button is clicked, either an image of the artist’s work is sent to the fulfiller or a link to the image, stored on the AWS Server, is sent to the fulfiller enabling access to the image: T, p 212, lns 13-23. The mechanism is put this way by Mr Kovalev: software running on the Redbubble server, that is, on the AWS Server, causes the image or a link to the image to be sent to the fulfiller and that result is brought about by software commands executing on the Redbubble website which tell the software executing on the AWS Server to now send an image or a link: T, p 212, lns 25-37. He says that clicking the button “Pay” activates “the rest of the chain”: T, p 217, lns 6-7. As to the process or mechanism by which an artist’s original image is automatically stored on the AWS Server, Mr Kovalev says that software operating on the Redbubble website (upon the relevant commands or clicks) “initiates a process” of engaging with software on the AWS Server so as to save, automatically, the images to the AWS Server. A “copy” of the original image is displayed on the website: T, p 217, lns 23-45. That copy is made possible by the Redbubble software executed on servers in the United States: T, p 218, lns 9, 20-36. However, Mr Kovalev also says that the image (which is a copy of the original image), displayed on the Redbubble website, is “stored” on a “back end server” for the website “as is the case with any image on a website”, and storage on that “back end server” is part of the Amazon Web Services provided in the United States: T, p 220, lns 21-33.

Redbubble’s relationship with fulfillers

45    As to the relationship between Redbubble and the third party fulfillers, Mr Kovalev says this.

46    Third party fulfillers issue invoices to Redbubble USA on a monthly basis. Those invoices relate to the entire month’s volume of products manufactured by that fulfiller. The Fulfiller Fee charged by third party fulfillers varies depending upon the types of products provided. The Fulfiller Fee is comprised of: a product cost (which is described as a “blank” product cost of the relevant item pre-printing); printing costs; fulfilment costs (including packaging); and the margin set by the third party fulfiller. Redbubble USA arranges for “tags, stickers and other promotional material” to be provided to third party fulfillers to “deliver with shipments to customers”. Mr Kovalev describes these tags, stickers and other promotional material as the “packaging materials”. Mr Kovalev says that Redbubble USA does not manufacture the packaging materials or deliver the packaging materials to third party fulfillers. The packaging materials are manufactured by packaging companies in China and the United States of America and are delivered directly by those manufacturers to the third party fulfillers in large batches. Nevertheless, these “packaging materials” are attached to the products as an essential element of the business model, at the direction of Redbubble. The packaging materials, typically, are those illustrated at Annexure VK-22 of Mr Kovalev’s affidavit of 28 July 2017 and they are set out below.

Confidential statistics

47    Mr Kovalev also gives evidence of statistics as at 26 July 2017 relating to the number of artworks displayed on the Redbubble website; the number of artists who have accounts on the Redbubble website; the approximate number of new artworks uploaded each day; the approximate number of orders placed by customers each day; the approximate number of new artists who sign up to the Redbubble website each day; and the number of sales made to date by the top selling artist. All of this information is described as confidential. Accordingly, the relevant statistics are set out in a redacted schedule to these reasons. It is not necessary to publish an un-redacted version of the Schedule to the parties because they already have the information available to them.

The Redbubble User Agreement

48    It now necessary to note the following provisions from the User Agreement.

Introduction

…

To make this online destination for creativity available, it is essential all Redbubble users respect the intellectual property rights of others, including copyright and trademarks. You must only upload content you have created yourself and have permission to use and authorize others to use. If you are a customer or browser, please respect the copyright and trademarks of all the works you see or buy on Redbubble. Respecting other people’s intellectual property is an essential principle of Redbubble’s community.

…

Our service

Redbubble provides a range of services (the “Redbubble service”) which, amongst other things, enable you to publish, sell, discuss and purchase art; interact with other members; and receive the benefits of Redbubble’s facilitation of product fulfilment, including payment processing, customer services, third party product manufacturing. In addition, Redbubble will arrange for the deliver[y] of the physical product to your customer. …

Any [artist’s] content that you upload into the portfolio section of your account is described as your “art”. Your art may be viewed by all users of the website once you elect to publish it. You may order a physical product based on your own art or you may offer your art for sale as part of the sale of a physical product. If you or a customer decide to place an order, then Redbubble will forward your instructions to third parties who will manufacture and ship the physical product in the form specified by you or the customer (“the product”).

Members

You can become a registered member (“member”) of the website by setting up a password protected account. You will be required to select a username and password when registering to become a member. You must become a member before placing any content on the website, including writing any comments in forums or reviews. In its sole discretion, Redbubble may refuse any username that it decides is inappropriate and/or refuse any person from becoming a member.

Putting content on the Redbubble site

You keep the copyright in any content you submit or upload to the website. In order to receive the Redbubble services you grant Redbubble a non-exclusive royalty free licence to use and archive the content in accordance with or as reasonably contemplated by this agreement.

When you submit or upload content on the website you represent and warrant that:

•    you own all copyright in the content, or if you are not the owner, that you have permission to use the content, and that you have all of the rights required to display, reproduce and sell the content;

•    the content you upload will not infringe the intellectual property rights or other rights of any person or entity, including copyright, moral rights, trade mark, patent or rights of privacy or publicity;

•    your use of the website will comply with all applicable law, rules and regulations;

•    the content does not contain material that defames or vilifies any person, people, races, religion or religious group and is not obscene, or pornographic, indecent, harassing, threatening, harmful, invasive of privacy or publicity rights, abusive, inflammatory or otherwise objectionable;

•    the content does not include malicious code, including but not limited to viruses, trojan horses [and a range of synonyms for those things], or other computer programming routines that may damage [and other synonyms] any system, program, data or personal information; and

•    the content is not misleading and deceptive and does not offer or disseminate fraudulent goods, services, schemes or promotions.

Redbubble reserves the right to review and if in its sole discretion deemed necessary, remove any content from the website and/or cancel your account, because that content breaches your agreement with us and/or any applicable laws or otherwise. You agree to indemnify Redbubble in respect of any direct or indirect damage caused due to your breach of one or more of these warranties.

Offering your art for sale on a physical product

Any member may offer their art for sale on a physical product on the website by appointing Redbubble to facilitate the transaction on the terms set out in the Services Agreement in Appendix A. By agreeing to the terms of this user agreement you expressly agree to the terms of the Services Agreement in Appendix A, which will apply from the date on which you offer your first art for sale on a physical product and your continued use of the website will constitute ongoing agreement to the terms therein as updated from time to time.

Intellectual Property Rights and license

By submitting listings to Redbubble, you grant Redbubble a non-exclusive, worldwide, royalty free, sublicense able and transferable license to use, reproduce, distribute, prepare derivative works of and display the content of such listings in connection with Redbubble’s (and its successors’ and affiliates’) services and business in facilitating the sale of your product, including without limitation for promoting and redistributing part or all of the Redbubble site (and derivative works thereof) in any media formats through any media channels. You also hereby grant each user of the Redbubble site a non-exclusive license to access your content through the site, and to use, reproduce, distribute, and display such content as permitted through the functionality of the site and under this User Agreement. The above licenses terminate within a commercially reasonable time after you remove or delete your listings from the Redbubble site.

…

Indemnity

You agree to indemnify, defend and hold us, our officers, directors, employees, agents and representatives harmless, as well as, all third parties [undertaking all fulfilling activities] … harmless, from and against any and all claims, damages, losses, liabilities … or other expenses that arise directly or indirectly out of or from: your breach of any clause of this agreement; any allegation that any materials that you submit to us or transmit to the website infringe or otherwise violate the copyright, trademark, trade secret or other intellectual property or other rights of any third party; and/or your activities in connection with the website.

[emphasis added]

49    Appendix A to the Services Agreement contains these provisions which should be noted:

You wish to use Redbubble’s services to facilitate marketing and sale of your art on a physical product and to arrange for manufacture of the physical product (your product) once an order has been made through [.redbubble.com] (“the website”). Redbubble will provide these services on the terms set out in this Services Agreement. Additionally, Redbubble will provide for delivery of such products to the customer.

1.    Services

1.1    Redbubble, acting as independent contractor under your instructions will market to and obtain orders from customers for the purchase of your products over the website and on instruction from you, Redbubble will arrange for third parties to fulfil those orders by facilitating payment for and manufacture of your products (“Services”). Redbubble will then arrange for the delivery of your products as per the customer’s instructions.

…

2.    License and standing instructions

2.1    You grant Redbubble a non-exclusive royalty free license to use your intellectual property relating to your products for the purpose of enabling us to carry out the Services.

2.2    You hereby instruct Redbubble to facilitate the sale of your product which includes payment, processing and arranging for manufacturing your product(s) in respect of the orders placed by the customers via the website and Redbubble will facilitate such payment, and manufacturing in accordance with reasonable business practices unless you otherwise instruct prior to the placement of that order by a customer.

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3.    Sale of your products

3.1    The retail price charged to customers who purchase your product is made up of the manufacturing fee charged by the third party manufacturer, Redbubble’s fee for hosting the marketplace and facilitating the transaction (the manufacturing fee and Redbubble’s fee are referred to collectively and inclusive of tax, as the “base amount”), your creator margin (“your margin”), and any relevant sales tax (such as Sales Tax, GST, VAT, etc) that Redbubble and/or you (as the case may be) are liable to account for to the appropriate tax authorities. Shipping charges will also be added to the retail price. When making each individual work available for sale you are able to select any percentage markup you wish, greater than or equal to zero, above the base amount but below the automated upper limit set by Redbubble (subject to change from time to time). The percentage markup selected by you on the website for each of your products is used to calculate the dollar value of your margin for each sale.

6.    Indemnity

6.1    You hereby indemnify and will Redbubble indemnified from and against all claims [synonyms] … of any nature whatsoever … arising from … any breach or non-performance of your obligations under this Services Agreement or arising out of your wilful act, neglect or default in the performance of such obligations.

[emphasis added]

50    As to Mr Kovalev’s evidence, I generally accept his evidence concerning the functionality of the Redbubble website again subject to the observations later in these reasons from [405] concerning the proper characterisation of Redbubble’s engaged role in the transactional features of the activities enabled by and through the website.