Cat Media P/L v McCoy T/A Laser Skin & Vein Clinic No. Scgrg-99-501 Judgment No. S266

[1999] SASC 266

CAT MEDIA PTY LTD v McCOY T/A LASER SKIN AND VEIN CLINIC)

[1999] SASC 266

Miscellaneous Appeals

1 WICKS J                  This is an application for an interlocutory injunction pending an appeal to a single judge of this Court from a refusal of a master to order an interlocutory injunction pending a trial of the action.
2 The plaintiff manufactures and distributes a product known as "Vein Away".  The plaintiff also markets a range of other cosmetics including a range of skin care products.
3 The product was launched by the plaintiff in Australia in August 1998.  It is a cosmetic consisting of a topical cream which the plaintiff claims has the effect of reducing the appearance of spider veins on the surface of the skin.  The plaintiff contends that the main ingredient in the product is vitamin K.  The product is marketed as a vitamin K based cream which could assist in the reduction of spider veins.
4 The plaintiff claims to have a substantial market in Australia for the "Vein Away" product.  It is usually stocked by chemists as a treatment for spider veins.
5 The plaintiff contends that the defendant, Dr McCoy, operates a clinic known as the "Laser, Skin and Vein Clinic" situated at 262 Melbourne Street, North Adelaide which treats persons with spider veins using traditional methods.  According to the plaintiff, traditionally spider veins have been treated by a process known as "sclerotherapy" where a type of saline solution is injected into the veins.  This process is also used in the treatment of the medical condition known as varicose veins.  Laser therapy is also used as a treatment for spider veins but such treatments are generally undertaken at medical clinics staffed by qualified medical practitioners.
6 On 8 March 1999, Channel 7 Adelaide Nightly News broadcast a segment featuring "Vein Away" and Dr McCoy.  A transcript of the news report as contended by the plaintiff was in the following terms:
"News Reader:

‘If you’re at all vain about your veins, we hope you won’t watch this next story, in vain.’

Reporter:

‘They are an embarrassment for millions of women the world over.’

Patient "Vera"

‘When the grandchildren, the little girls come to visit they say "Vera what are those funny marks on your legs?"’

Reporter:

‘Yet simply rub on "Vein Away" and those unsightly veins will disappear in just 33 days, or so the sales pitch goes.  The product has been a popular seller in chemists and beauty salons, now an Adelaide study is set to test if the so called "miracle" cream lives up to its name.’

Dr Sue McCoy:

There is nothing that we can see has any medical basis that would effectively cure spider veins, but we can’t give that a categorical no it won’t work until it’s been tried.’

Reporter:

‘If the cream is as good as it sounds it could mean the end to saline injections which are currently the most successful form of treatment.’

Dr Sue McCoy:

‘It’s slightly painful, it’s time consuming and doesn’t work the same for everyone, so if there were a cream that worked it would be just miraculous.’

Reporter:

‘50 volunteers are being sought to take part in the month-long trial.  Patients will use ‘Vein Away’ on one leg and a placebo or fake cream on the other.  Neither the patient nor doctor will know which cream is which until after the study is complete.  Researchers are looking for women who have similar spider veins on both legs and haven’t had any previous treatment.  Seven Nightly News will bring you the test results next month, Narelle Hill, Seven Nightly News.’"

7 There is no evidence before me that the trial referred to in the Channel 7 news item was ever completed.  The evidence as it stands indicates that it was not.
8 For the purpose of this application, I accept the above account as factual.
9 A summons in this action was issued on 5 May 1999 and sought certain relief by way of mandatory injunction.  It also sought a prohibitory injunction restraining the defendant from publishing or disclosing the results of tests conducted by the defendant with respect to the plaintiff’s product "Vein Away".
10 The matter was heard by a master of this court on 7 May 1999 when an injunction in the following terms was granted ex parte:
"Until 20th May 1999 the defendant be restrained and an injunction be granted restraining her whether by herself, her agents, servants, workmen or otherwise from publishing or disclosing the documents evidencing the results of tests conducted by or on behalf of the defendant with respect to the plaintiff’s product ‘Vein Away’ or the information contained therein to any person, other than the plaintiff."

11 The matter came before another master of this court, in chambers on 20 May 1999 when the injunction was extended until 4 pm on 23 June 1999. 
12 The matter came again before the master on 22 June 1999.  In his note when dealing with the application the learned master said:
"I think on an application for the continuation of an interim injunction, where the original interim order has been made by another member of the Court is that I must have regard to the relevant principles and make up my own mind as to whether or not an interim injunction should be continued.  This is particularly so where the order was originally made ex parte and extended at a time when the defendant’s solicitor had not had the opportunity to take instructions.  The principles in Castlemaine Toohey v The State of South Australia are applicable, but in my view there is a lesser onus on the ptf to establishing entitlement to an interim injunction because the proceedings are at a very early stage.

In my view the plaintiff has not demonstrated to the degree required that there is a serious question to be tried.  I do not think on any view of the facts or law it can be said that either the statements attributed to the defendant in the transcript of the news report can be categorised as potentially false and misleading or is constituting an injurious falsehood.  Nor do I consider that the transcript of the news report or any correspondence that has been exchanged since then gives rise to the possibility that the announcement of any results by the defendant of the tests made by the defendant will possibly constitute either misleading or deceptive conduct or an injurious falsehood."

13 The learned master therefore refused the application for the extension of the injunction which expired at 4 pm on 23 June 1999.
14 An application was made to me in chambers on 24 June 1999 for a limited injunction pending an appeal from the learned master’s order refusing to extend the injunction before him.  The order sought was a continuance of the original order made on 7 May 1999 nunc pro tunc from 4 00 pm on 23 June 1999, the time at which the original order lapsed, until the decision on the appeal from the master’s order.
15 I indicated that an injunction of that kind could not be made to have retrospective operation but would have to operate from the time that it was made.  At the hearing on 24 June 1999, I indicated that I was not familiar with the file but that I would hear argument.  At the conclusion of argument, I decided to grant an interim injunction until 5 pm on 29 June 1999 to enable me to consider the matter in the meantime.  The injunction granted by me was in the following terms:
"That until 5.00 pm on Tuesday 29 June 1999 the defendant be restrained and an injunction is hereby granted restraining her, whether by herself, her agents, servants, workmen or otherwise from publishing or disclosing the documents evidencing the results of tests conducted by or on behalf of the defendant, with respect to the plaintiff’s product ‘Vein Away’, or the information contained therein to any person, other than the plaintiff."

16 Under r106.05, an appeal lies against the decision of a master. Where a final decision or judgment is involved, the appeal lies to the Full Court but otherwise the appeal lies to a single judge. See generally Hall v The Nominal Defendant (1966) 117 CLR 423 and TRAMS Pty Ltd v The Grand Hotel Pty Ltd (1993) 170 LSJS 312. It would appear that the order of the learned master refusing to extend the injunction before him was not a final order and that an appeal against it must therefore lie to a single judge.
17 Pending the appeal, I have been asked to grant an injunction of a limited nature on the basis that a refusal of interim relief would render the appeal to a single judge of this court nugatory. In Paringa Mining and Exploration Co PLC v North Flinders Mines Ltd (1988) 165 CLR 452, at p460 the court said:
"[The judge at first instance] should have been concerned not only to evaluate the argument against his original decision but also to enquire whether refusal of interim relief would have rendered the appeal nugatory.  The result is that the appellant to the Full Court has been denied the independent consideration of its application for an injunction pending the appeal to which it was entitled."

18 See also Erinford Properties v Cheshire County Council (1974) 1 Ch 261 and Wilson v Church (1879) 12 Ch D 454.
19 In the present case the plaintiff is entitled to the independent consideration of an appeals court of its application for an injunction where a judge on appeal will review the question of whether there was a serious question to be tried.
20 I am of the view that an injunction pending the appeal is necessary and that to proceed without such an injunction would render the plaintiff’s appeal nugatory.
21 In the circumstances, the plaintiff is entitled to a limited injunction pending the outcome of the appeal.
22 On 29 June 1999, I ordered that the injunction which I made on 24 June 1999 was to be extended to the making of a decision on the appeal from the learned master’s order of dismissal and indicated that I would publish my reasons later.  These are my reasons.
23 On 29 January 1999, I ordered:

1. that the injunction which I made on 24 June 1999 be extended pending the decision of a judge of this Court on the hearing of the plaintiff’s appeal instituted by notice of appeal dated 29 June 1999;

1. that the costs of this application and order be reserved;

1. that there be liberty to apply, to vary or discharge the injunction continued in force this day.