Cody Opal (Australia) Pty Ltd v Dimasi - [2004] SASC 357

Supreme Court of South Australia
(Civil)
CODY OPAL (AUSTRALIA) PTY LTD v DIMASI
Judgment of The Honourable Justice Mullighan
11 November 2004
INTELLECTUAL PROPERTY - COPYRIGHT - INFRINGEMENT
INTELLECTUAL PROPERTY - TRADE MARKS AND TRADE NAMES - INFRINGEMENT AND PASSING OFF
TRADE AND COMMERCE - TRADE AND COMMERCE GENERALLY - STATUTES RELATING TO MISLEADING OR DECEPTIVE CONDUCT IN TRADE - SOUTH AUSTRALIA
TRADE AND COMMERCE - TRADE PRACTICES AND RELATED MATTERS - CONSUMER PROTECTION - MISLEADING, DECEPTIVE OR UNCONSCIONABLE CONDUCT
Alleged infringement by defendant of plaintiff's trade mark and copyright relating to advertising signs and promotional material - alleged misleading and deceptive conduct in contravention of the Fair Trading Act 1987 (SA) and passing off by the defendant in relation to the plaintiff's opal business - plaintiff holds copyright and registered trade mark over The National Opal Collection with use of an opalized border adapted from a photograph taken on behalaf of the plaintiff - defendant registered and traded under the name The Australian Opal Collection and used the opalized border from the front cover of a book published by the plaintiff - whether use of two elevated signs by the defendant breached the plaintiff's trade mark in being substantially identical or deceptively similar to it - whether the two elevated signs were used in good faith - whether the defendant breached the plaintiff's copyright in the opalized border through reproduction - whether the defendant used the name, marks, publications and signs so as to induce customers to believe that the goods were the goods of the plaintiff - whether the conduct of the defendant in the use of its publications and signs contravenes s56 and s58(f) of the Fair Trading Act.
The two overhead signs breached the plaintiff's registered trade mark - the use of the opalized border breached the plaintiff's copyright - the use of the name, marks, publications and signs constituted misleading and deceptive conduct and passing off.
Lahore Copyright and Designs 2003, referred to.
Nationwide News Pty Ltd & Ors v Copyright Agency Limited (1996) 65 FCR 399; Wingate Marketing Ltd v Levi Strauss & Co (1994) 49 FCR 89; R & C Products Pty Limited trading as Samuel Taylor v SC Johnson & Sons Pty Limited (1993) 42 FCR 188; Dart Industries v Decor Corporation Pty Ltd (1993) 179 CLR 101; Autodesk Inc & Anor v Dyason & Ors (No 2) (1993) 176 CLR 300; Equity Access Pty Ltd v Westpac Banking Corporation & Anor (1989) 16 IPR 431; Kalamazoo (Aust) Pty Ltd v Compact Business Systems Pty Ltd & Ors (1985) 84 FLR 101; Caterpillar Loader Hire (Holdings) Pty Ltd & Ors v Caterpillar Tractor Co (1983) 48 ALR 511; Erven Warnink BV & Anor v J Townend & Sons (Hull) & Anor [1979] AC 731; British Northrop Limited & Ors v Texteam Blackburn Limited & Ors [1974] RPC 57; Colbeam Palmer Ltd v Stock Affiliates Pty Ltd (1968) 122 CLR 25; FH Faulding & Co Ltd v Imperial Chemical Industries of Australia & New Zealand Ltd (1964) 112 CLR 537; The Shell Company of Australia Ltd v Esso Standard Oil (Australia) Ltd (1963) 109 CLR 407; Australian Woollen Mills Ltd v FS Walton & Co Ltd (1937) 58 CLR 641; Pollock v JC Williamson Ltd [1923] VLR 225, applied.
CA Henschke & Co v Rosemount Estates Pty Ltd (2000) 52 IPR 42; Eagles Homes Pty Ltd v Austec Homes Pty Ltd (1999) 87 FCR 415; Betta Foods Australia Pty Ltd v Betta Fruit Bars Pty Ltd (1998) ATPR 41-624; MID Sydney Pty Ltd v Australian Tourism Company Ltd & Ors (1998) 90 FCR 236; Conagra Inc v McCain Foods (Aust) Pty Ltd (1992) 33 FCR 302; SW Hart & Co Pty Ltd v Edwards Hot Water Systems (1985) 159 CLR 466; Moorgate Tobacco Co Limited v Philip Morris Ltd & Anor (No 2) (1984) 156 CLR 414; LB (Plastics) Products Limited v Swish Products Limited (1979) 1A IPR 359; de Cordova v Vick Chemical Co (1951) 68 RPC 103, considered.

CODY OPAL (AUSTRALIA) PTY LTD v DIMASI
[2004] SASC 357
Civil

MULLIGHAN J: The plaintiff is, and was at all material times, a company duly incorporated pursuant to the relevant Corporations legislation.
The defendant carried on the business at all material times of manufacturing, promoting, offering for supply, selling, exporting, displaying and supplying opals and opal jewellery at 14 King William Street, Adelaide and elsewhere.
The plaintiff brings this action against the defendant alleging infringement of its trade mark, infringement of copyright, misleading and deceptive conduct in contravention of the Fair Trading Act 1987 and passing off and seeks various declarations, injunctions, damages, delivery up of all articles which infringe the trade mark, an account and enquiry and interest. The defendant contests that the plaintiff is entitled to any aspect of such relief.
What follows represents the findings fact which I have made based upon the evidence of the various witnesses and the many documents which were admitted into evidence. I accepted the evidence of the various witnesses, including the evidence of Mr Andrew Cody and Mr Damien Cody, who are brothers and the directors of the plaintiff, as to the development and operation of the business of the plaintiff. They control the business of the plaintiff. In the main, I also accepted the evidence of the defendant and his wife, Mrs Dimasi, but not entirely. I concluded that at times they tailored their evidence to suit the defendant’s case and in some respects I did not think either of them was entirely truthful. Where their evidence differs from the findings which I have made, I rejected it.
Background of the plaintiff
The plaintiff’s business was established by Mr Andrew Cody in 1971. In 1978 the plaintiff was incorporated under the name Andrew Cody Pty Ltd and that name was later changed to Cody Opal (Australia) Pty Ltd.
Mr Andrew Cody commenced business originally as an opal cutter, manufacturer of jewellery and a wholesaler of opals in 1971 and a retail operator in 1979 in the central business district in Melbourne. His brother, Mr Damien Cody joined the plaintiff in February 1998 when he became a director. Before that time he had worked extensively in the insurance industry. Mr Andrew Cody and the business of the plaintiff are well known in Australia and internationally as leading Australian opal cutters, wholesalers and exporters.
The plaintiff carries on business at 125 Swanson Street, Melbourne where there are administration offices and retail premises. It has an office in Hong Kong and agencies in Japan and in the United States. Also, it has office and retail premises at 119 Swanson Street, Melbourne, which is in the Central Business District. It also has premises at 176 Pitt Street Mall in Sydney, which is in the Central Business District of that city where it carries on business as “The National Opal Collection”. The plaintiff has been established regularly since about 1990 at major international gem and jewellery shows in leading centres of the world which are in Japan, Hong Kong, Switzerland, France, Germany and the United States of America.
Mr Andrew Cody is a founding member of the Australian Jewellery and Gemstone Industry Council in 1999. He is Chairman of the Council and has been President of the Australian Opal and Gem Industry Association and an Associate of the Australian Museum in 1999. I accept that in 1993 the opal was proclaimed the national gemstone of Australia but the evidence does not disclose by whom. Mr Andrew Cody was the chairman of the National Gemstone Committee which promoted this proclamation. I accept that the opal is widely known and accepted as the national gemstone of this country. Mr Andrew Cody is the author of a well-known book entitled “Australian Precious Opal - a Guide Book for Professionals” (“Mr Andrew Cody’s book”) which was first printed and published in 1991. It is used by persons engaged in the Australian Opal Industry. 7,000 copies in hard cover and 14,000 copies with a soft cover were printed and distributed between 1991 and 2002 to selected persons. A version printed in Japanese was also published and distributed. Later I mention features of this book which are relevant to matters in issue in these proceedings.
Mr Damien Cody is also well known in the opal industry and trade in Australia and overseas. Mr Damien Cody is the Ambassador to Australia for the International Coloured Gemstone Association, which is the pre-eminent organisation representing gem dealers in the coloured stone industry.
Both Mr Andrew Cody and Mr Damien Cody frequently speak at industry seminars and conferences about matters relating to the industry and in doing so promote the business of the plaintiff.
The National Opal Collection is part of the business of the plaintiff. It was formed in about June 1999. Through Mr Andrew Cody and Mr Damien Cody, the plaintiff entered into an arrangement with the Australian Museum which has a substantial collection of Australian opal. Mr Andrew Cody described it as probably the world’s most significant public collection. Mr Andrew Cody also had a substantial personal collection of Australian opal. The collections were put together to promote opal, educate people and also provide the opportunity for the plaintiff to sell opal and opal jewellery.
The plaintiff caused the business name of “The National Opal Collection” to be registered in New South Wales on 11 January 2000 and it has remained so registered at all material times.
Between June and November 1999 Mr Andrew Cody and Mr Damien Cody decided upon the name The National Opal Collection for the business they intended to establish in Sydney. At the end of that period they designed the art work which forms part of the trade mark and settled upon the trade mark for the business. I shall return to this mark later.
The plaintiff took possession of the premises at 176 Pitt Street Mall, Sydney on 1 January 2000, an agreement to lease having been executed in June 1999, and commenced carrying on business at those premises on 1 May 2000. Much of the collections of the Australian Museum and Mr Andrew Cody was displayed at the premises. About two-thirds of the premises was used to display the two collections and the balance was used for the showroom of the business.
The business operates under the name of The National Opal Collection in Sydney. It sells opal and also operates a museum. It exhibits opal and artefacts and there is an educational component, including as to the history of the development of opal in this country. Scientific and technical literature is provided. I accept the evidence that the premises in Sydney are a significant tourist destination and attract persons interested in one or more of buying opal, and viewing the collection, the display of the history of the development of opal and in scientific and technical matters. Publications admitted into evidence reveal photographs of the premises showing these various features. The premises are at basement level and appear to be attractive and interesting.
Entry to the premises is free. The section of the museum at the premises includes Aboriginal dreaming beliefs, terrestrial-type dinosaur fossils, opalized fossils of plants, marine opalized fossils and an opalized skeleton of a dinosaur which, according to Mr Damien Cody, is the world’s most significant opalized fossil and is owned by the Australian Museum. Also, there are other skeleton fossils, an opal cave and an opal cutting demonstration room. There is an area dedicated to social history of the pioneer of opal in Australia.
I accept that the business was widely promoted by the plaintiff before and after it opened. It has only operated in Sydney at the Pitt Street Mall premises which is in a prominent location in the central business district. It has developed rapidly. In the brief period of trading in the financial year ending 30 June 2000, the turnover was about $150,000. In the following year it was about $2 m. In the year ending 30 June 2002, it was in the order of $1.7 m. It makes its revenue by the sale of opal.
Promotional activities of the plaintiff
The plaintiff directed promotional activities to international tourists in Australia and elsewhere overseas and presented its name and its business, including The National Opal Collection, through trade shows, overseas tour operators who direct tourists into Australia, tour operators in this country, the tourists themselves, Australian consumers and the international coloured gem trade.
Also the plaintiff promoted The National Opal Collection extensively in Sydney. I need not set out all of the various promotions. A relatively brief summary will suffice for present purposes. In the period leading up to the opening of the shop and museum, the plaintiff advertised in the publication “Welcome to Australia”, which is placed in hotel rooms. The plaintiff’s business in Sydney is predominantly advertised in the inside of the front cover and the first page and shows, inter alia, the trade mark. The same extensive advertisement appears over two full pages later in the publication and later a further two page advertisement appears which advertises the premises in Melbourne. There is another single page advertisement further on in the publication showing the address of the premises in Sydney. This publication advertises jewellers, tourist destinations and various products. This publication was placed in about 17,000 hotels throughout Australia.
On 1 March 2000 the plaintiff appointed a full-time marketing manager who advised the plaintiff and promoted the business of The National Opal Collection. She attended workshops for tourism operators and involved herself with Tourism New South Wales and the Australian Tourism Commission. In consequence of her work, the plaintiff joined appropriate tourist organisations and its representatives, including Mr Andrew Cody and Mr Damien Cody, attended workshops and conferences to promote the business of the inbound tourist industry.
Various brochures were printed showing in coloured pictorial presentation the premises and activities and the trade mark. One brochure entitled “The National Opal Collection”, which displayed the trade mark, was printed in both English and Japanese. In March 2000 5,000 copies were printed in each language and since May 2000 about 80,000 copies were printed. The brochures were distributed to all inbound tourism operators (with a covering letter), hotels and airports and were placed in brochure racks and tourist attractions. Business cards were also printed and used. A brochure distribution company, which was engaged by the plaintiff, distributed the brochures to inbound tour operators, hotels, tourist destinations and airports. In May or June 2000 a concierge map was prepared. It is a hotel publication and targets international travellers and was widely distributed in the six to twelve months period commencing in June 2000. Mr Damien Cody estimated that about 30,000 to 40,000 copies of this publication were produced and distributed. 10,000 adhesive labels showing the trade mark were produced in early 2000 and were used on envelopes, documentation, shopping bags and various initiatives. The plaintiff advertised in publications of the Qantas Magazine used on international flights each month commencing in August 2000 into 2001. The publications advertised The National Opal Collection in Sydney and displayed the trade mark. Also, the plaintiff published advertisements in the magazine “Australian Jewellery Directory” which is distributed to the gem trade throughout Australia. It was published in June 2000.
The plaintiff also advertised as from June 2000 in the publication “This Week in Sydney”, which is published monthly, for a period of about 12 to 18 months. About 30,000 copies were distributed each month. The advertisement shows the trade mark on two pages and promotes The National Opal Collection. Representatives of the plaintiff visited concierges in the period from June to August 2000 and held a cocktail party at the premises at Pitt Street Mall which was attended by about 50 of them at which business of The National Opal Collection. In June 2000 a spruiker was engaged by the plaintiff who promoted the business in the Pitt Street Mall for about eight weeks. He dressed as an olden day miner. He distributed brochures showing the trade mark and drew the attention of persons in the Mall to the plaintiff’s premises.
On 24 August 2000 the plaintiff held a function for about 150 invited guests to the official launch of The National Opal Collection. The guests were selected from Government, the gem trade and the tourism industry and there was publicity in a section of the media. About 300 guests had been invited and an entry was placed in the publication “Yellow Pages” in Adelaide setting out the name of The National Opal Collection, the address of the premises in Sydney and the telephone number. In August 2000 the plaintiff was a sponsor of an international robotics conference in Sydney and the delegates were given brochures in their satchels and arrival packets which displayed the trade mark and contained information about The National Opal Collection business. They were also given stick pins with opal and other items with opal. Delegates and accompanying persons were taken to the premises in Pitt Street Mall for a cocktail party and a programme for partners of delegates was provided by the plaintiff. The National Opal Collection name and business were promoted during these activities.
The promotional activities also included with the preparation and distribution of compact discs, video tapes and DVDs promoting The National Opal Collection name and business. The first compact disc or video tape was produced in June or July 2002. One of these items was produced for educational purposes and was shown in a small theatre at the Pitt Street Mall premises. Others were supplied at trade shows and were produced in four languages, English, German, Japanese and Mandarin. These publications included advertising of The National Opal Collection and used the trade mark.
The plaintiff also advertised in the publication “The Yellow Guide” in March 2000 which is directed to Japanese tourists and is published in the Japanese language. The advertisement contains the trade mark and names and addresses of the plaintiffs business in Sydney and Melbourne. Also, the plaintiff advertised in the publication “Sydney, The Official Guide” which was published in June 2000 and thereafter and the publication “Sydney Cruise Arrivals” also published in June 2000. Both of these publications also published the name The National Opal Collection and the address of the plaintiff’s premises in Pitt Street Mall, Sydney.
I accept the evidence of Mr Damien Cody that by the time the premises at the Pitt Street Mall opened for business on 1 May 2000, they looked much as they do now and as is shown in promotional material, although some exhibits had not been put in place. There had been extensive promotion of The National Opal Collection name and business. As from January 2000 letters had been sent by the plaintiff to inbound tourist operators and they had been visited by staff of the plaintiff. The trade mark was produced in late June or early July and was erected at the premises. It was displayed as the centre piece of a sign overhanging part of the Pitt Street Mall outside the plaintiff’s premises and at entry to the premises in two locations. At one of these locations was the brass plaque which is the actual trade mark.
I accept the evidence of Mr Andrew Cody that upon entering into the arrangement with the Australian Museum, it was the intention of the plaintiff that the business The National Opal Collection would open in other States or Territories in Australia and in mid-2003 an agreement in principle was reached between the Australian Museum and the plaintiff to use the name The National Opal Collection in conjunction with the business of the plaintiff in Melbourne. Some advertising was undertaken but by the time of the trial the arrangements had not been concluded. However, “The National Opal Collection” has been projected into the market place in Melbourne but not in conjunction with the name “Australian Museum”.

The plaintiff also promoted The National Opal Collection in Sydney through advertising material used in Melbourne and has done so from March 2000. This material included a brochure printed in Japanese and a brochure printed in English. 5000 each of such brochures were printed. Some depicted the premises of the plaintiff in Melbourne and the others depicted the premises in Sydney.
Much of the evidence as to the promotion of The National Opal Collection business of the plaintiff relates to 2000. I accept the evidence of Mr Andrew Cody that although the Olympic Games were held in September of that year, that event was not the reason for the extensive promotional activity. He said that the promoted commenced early in the year and the Olympic Games in Sydney with many foreign visitors was regarded as a bonus by him. I accept his evidence that most international tourists are in Australia for a relatively short period of about two to three weeks and it was important to “entrench” the name of The National Opal Collection in the minds of tourism operators who bring customers to the plaintiff’s premises in Sydney.
Mr Damien Cody prepared a summary of the monies expended by the plaintiff for advertising and marketing the business of The National Opal Collection. The relevant amounts or invoices were put together in a folder and admitted into evidence. A summary of the expenses paid or incurred and remaining unpaid was for each relevant financial year was also admitted into evidence. I accept the evidence of Mr Damien Cody that the amounts paid or incurred by the plaintiff in the promotion, advertising and marketing of the business The National Opal Collection for each financial year ending 30 June are as follows:
$
2000  53,866.27
2001  327,139.81
2002  233,059.87
2003  195,155.02
2004 (to trial)      83,207.14
  $842,428.11
The evidence clearly establishes that the plaintiff had a widely held favourable reputation in the opal industry in Australia before the business The National Opal Collection was opened in Sydney. There was extensive promotion of that business before and after it opened directed to tourists and the public generally which enhanced and further spread the reputation of the plaintiff. I accept that by the time the business opened in Sydney, it enjoyed the same reputation as the plaintiff. The promotion of The National Opal Collection was not confined to Sydney and Melbourne. Some of the promotional material occurred in the other major retail centres in each State of Australia, including in Adelaide.
I accept the evidence of Mr Andrew Cody and other witnesses that he and his brother are pre‑eminent and very well known in the opal industry in Australia which, together with the connection with the Australian Museum, has enabled the business of The National Opal Collection to develop rapidly.
The Opal Industry
I accept the evidence of Mr Andrew Cody and other witnesses, including the defendant, as to the nature of the opal industry in this country. It is comprised of the persons who mine the opal, dealers who buy and sell opal, jewellery manufacturers who make items from opal, wholesalers who sell finished opal products to retailers and retailers and purchasers of the finished product.
There are specialist opal retail outlets such as where the business of the plaintiff and, to some extent, the defendant, operate, which rely, in the main, on international tourists as their principal customer base. These outlets are usually located in areas, including the major capital cities, which attract international tourists. Opals are popular throughout most parts of the world but are particularly popular in Japan, Europe and the United States of America. English is not the first language of many customers and potential customers which, I accept, is a relevant matter when considering deceptions arising from words associated with artwork in trade marks.
The trade mark of the plaintiff
I return to Mr Andrew Cody’s book. The cover of this book is black with a rectangular part on the front cover which has an opalized border, the outside and inside of which are gold in colour. Within this border are the words of the title of the book printed in gold on the black background.
The opalized border was prepared by Minet Scans Pty Ltd (“Minet Scans”) from a photograph of an opal taken by Mr Andrew Cody in 1991. I shall refer to the opalized border as “the border” and to the photograph as “the photograph”. At that time he was a director of the plaintiff. He described the opal as a very fine stone . He described the photographic process. Mr Calloway, a director of Minet Scans, also described this process. It is sufficient for present purposes to describe the process briefly. A process was used so that all of the curved surface of the opal would be in the same process when the photograph was taken. The photograph was divided into sections so that each section became a narrow strip depicting part of the opal. Minet Scans then compiled those strips in various ways to make the border. When used on the cover of the book, parts of the strips were repeated. The border is a compilation of extracts from the strips created from the photograph. According to Mr Calloway, the best parts of the photograph were selected and arranged so as to produce the opalized border and the process involved developing photographs of many pieces of opal which expression conveys the compilation of the strips prepared from the photograph of the one opal.
On 14 June 2001 Minet Scans, by deed of assignment, assigned, transferred and set over to the plaintiff all of its rights, title and interest in the copyright subsisting in the opalized border which it had developed from the photograph taken by Mr Andrew Cody and which became the opalized border on the cover of the book. S 196(1) of the Copyright Act 1968 (Cth) provides that copyright is personal property and is transmissible by assignment, will and devolution by operation of law.
In December 1999 the plaintiff developed the trade mark which is the subject of the action. It is the mark which relates to the business The National Opal Collection.
The trade mark is a rectangular brass plate with an elevated border. Near each corner is a brass stud. Within the brass plate is an opalized border with a concave indent to each corner. Within the opalized border is a black background upon which are the words “The National Opal Collection”. I reproduce the trade mark:
It has not been possible to reproduce the trade mark in these reasons in colour due to limitations in technology.
The plaintiff caused the trade mark to be registered as Trade Mark No 881485 in the Register of Trade Marks by the Registrar of Trade marks on 4 July 2001, pursuant to the Trade Marks Act 1995 (Cth). It was registered for the wholesale and retail sales of jewellery and precious stones.
The opalized border is taken from the opalized border of a cover of Mr Andrew Cody’s book. According to Mr Damien Cody, this use of a brass plaque is to show “class”. The words are in gold or brass coloured lettering on a black background as appear on the cover of the book.
The trade mark was used by the plaintiff extensively in the promotion, advertising and marketing of The National Opal Collection prior to the commencement of the business on 1 May 2000 and ever since. I accept that it is a distinctive trade mark designed to give the appearance of elegance and class and the association of the plaintiff and the Australian Museum.
Background of the defendant
The defendant has conducted an opal retail business since about 1988, except for a brief period, known as Riverside Collections in the Riverside Building at North Terrace, Adelaide. He left the business in 1991 and returned in 1992 as the manager. A little later he acquired the business at that location and changed the name to “Opals of Australia International”.
He is a member of the Australian Jewellers Association, the Gemmological Association of Australia, Adelaide, Tourism Commission Authority, Opal & Gem Industry Association of Australia which is now part of the Australian Jewellers Association and a body known as “Cruise Down Under”.
Opals of Australia International is an opal shop and lobby shop for the Hyatt Hotel in Adelaide with opals, souvenirs and lobby shop items for sale.
I accept Mr Dimasi’s evidence that he developed clientele from hotels and international travellers in that precinct. His wife, Mrs Dimasi, carried on business of displaying and selling hairdressing, beauty and fashion collections of different fashion designers.
The business of Opals of Australia International has been marketed by the defendant in the United States of America where he attempted to export opals and opal jewellery on a wholesale basis. The defendant has advertised and marketed the business in the Qantas and Japanese Airlines in-flight magazines. Japanese Airlines promotes the business as the preferred opal merchants for South Australia. It was also promoted on the website of the defendant and in printed advertising and promotional material.
The defendant is also the proprietor of the business known as “The Australian Opal Exchange”. The concept of this business was that opal miners could bring opal to Adelaide where it would be auctioned to the public or other buyers. He undertook work to establish this concept but had to desist in 1999 when he suffered a heart condition whilst in Zurich in Switzerland. The business name “The Australian Opal Exchange” was registered on 22 April 1997. As will be seen, this business was advertised and promoted by the defendant in the few months before the Olympic Games in Sydney. There is no evidence to establish what, if any, reputation had been developed for The Australian Opal Exchange before the events in the year 2000 and thereafter, which are the subject of this action.
As the defendant recovered his health, he considered establishing another business. He purchased premises at 14 King William Street, Adelaide which purchase was completed on 29 June 2000. According to the defendant, the Riverside building had limited clientele and was “off the beaten track”. He selected the premises in King William Street because there was greater flow of customers. He planned to use the ground floor as a retail area, an area for manufacturing jewellery downstairs and the first floor as an auction room. He wanted to create an upmarket jewellery store, including items for investment. He wanted to get away from an idea held by some persons that opal is a second grade product or semi-precious gemstone.
Work had to be undertaken to make the premises suitable for the business of the defendant. According to Mrs Dimasi the premises opened for business in about the end of July or early August 2000.
According to the defendant, the majority of purchasers of opal are in the United States of America with lesser markets in Japan, Germany and England. Over 95 per cent of the market is from international visitors. He targeted the middle income bracket.
The evidence of the defendant is that before the business opened in King William Street, Adelaide, he and his wife discussed the name of the business and the premises. She wanted the name “The Australian Opal Collection” because it indicated an atmosphere of upmarket jewellery, elegance and second-hand jewellery rather than all new jewellery. The defendant preferred the name “The Australian Opal Exchange”. Eventually both names were displayed at the front of the premises. According to Mrs Dimasi, shortly after settlement on the purchase of this property, the defendant caused to have painted on the front windows “Opening soon: The Australian Opal Collection” in early July 2001. The business name “The Australian Opal Collection” was registered by the defendant on 11 July 2000. It is not clear on the evidence when the premises at 14 King William Street opened for business but I accept that the opening occurred in the month or so before the Sydney Olympic Games.
The defendant and Mrs Dimasi decided to open a shop in Sydney because of the Olympic Games, which were held in that city from 15 September 2000 to 1 October 2000, would attract many overseas visitors. Through a friend, premises became available at York Street, Sydney. Mrs Dimasi said in evidence that she made all of the arrangements for the fit out of those premises and for the necessary signage and that she did so from Adelaide. The defendant arranged for business cards and other materials to be printed using the name “The Australian Opal Exchange”. She did not approve of that name but it was used. I shall return to this material shortly.
According to Mrs Dimasi, she did not go to Sydney until 9 September 2000. She then opened the shop at the York Street premises. She used stock and merchandise which she took from the business in Adelaide. She remained in Sydney for about four to five weeks during which period she did not return to Adelaide. The defendant went to Sydney on about 17 September 2000, a few days after the Games commenced.
Mrs Dimasi said that she was not aware of the plaintiff’s business The National Opal Collection until she was shopping in Sydney in the Pitt Street Mall which, on her evidence, was after 9 September 2000. She noticed the word “Museum” on the plaintiff’s premises and went inside. She went through the whole store. She described it as a beautiful shop. She said that it was nothing like the shop she proposed to set up at King William Street, Adelaide which was to be an elegant jewellery store. She regarded the plaintiff’s premises in Pitt Street Mall as a museum. Later she took the defendant to see the plaintiff’s premises.
The defendant’s business in York Street, Sydney, ceased to operate after the completion of the Games. In all, it was open for about 10 to 12 weeks. He and Mrs Dimasi returned to Adelaide and continued to operate his business at the King William Street premises under the name of The Australian Opal Collection.
I mention the evidence of Mrs Dimasi that about 90 per cent of the customers of the business The Australian Opal Collection are international visitors to Australia and the business mainly caters for individual persons.
The defendant has continued to carry on business at the Riverside and King William Street premises.
According to Mrs Dimasi, the name “The Australian Opal Collection” was selected because the opals were from Australia and a collection had a meaning in fashion which was “a gathering of beautiful things”. She wanted to make opal a fashion statement and to design pieces for the individual. These concepts led to the name “The Australian Opal Collection”. Mrs Dimasi denied any suggestion that this name, or any of the signs or publications of the defendant, were copied or taken from the plaintiff’s trade mark. As has been mentioned, she said that she did not see the plaintiff’s premises in Pitt Street Mall until after she went to Sydney on 9 September 2000.
A page of the defendant’s business diary was admitted into evidence. Mrs Dimasi said that the diary was left at the North Terrace premises and she used it and referred to it regularly. It is the page for 10 July 2000 and has no entry, except for a rough drawing of a rectangle with a border, an internal rectangle with a concave indent to each corner and with the words “THE AUSTRALIAN OPAL COLLECTION”. The general design has similarity to the plaintiff’s trade mark. Mrs Dimasi said that she made this drawing and probably on 10 July 2000.
An entry in Mrs Dimasi’s diary for 20 April 2000 is “Manthese leaves for Sydney”. Manthese Agius is, and was at the time, an employee of the defendant. Mrs Dimasi claimed that she could not say if Ms Agius went to Sydney in the first half of 2000. The diary also records that Ms Agius returned to Adelaide from Sydney on 30 April 2000. Ms Dimasi accepted that Ms Agius had been in Sydney during those dates. This evidence raises for consideration whether Ms Agius saw the plaintiff’s premises and trade mark when in Sydney and reported her observations to the defendant and Mrs Dimasi upon her return. She gave evidence and said that she had never been aware of the business The National Opal Collection until not long before the trial. I found no reason to reject her evidence and I dismiss any contention that the drawing in the diary by Mrs Dimasi was undertaken in consequence of Mrs Agius reporting to her observations of the plaintiff’s trade mark.
I have mentioned various advertisements used by the plaintiff in its promotional activities in 2000, including in and before June 2000 and the brochures advertising The National Opal Collection and displaying the plaintiff’s trade mark which were widely distributed to tourists, airports and hotels and elsewhere. Mrs Dimasi said she had not seen such a brochure until shortly before giving evidence. She denied seeing other promotional material of the plaintiff in hotels.
Later in cross-examination, Mrs Dimasi acknowledged that she had seen a brochure of the plaintiff promoting the business The National Opal Collection at Pitt Street Mall when she went to those premises in September 2000. She agreed that this occasion was probably not the first time she had seen the trade mark. She then agreed that she had seen it before that occasion. She agreed that she did see promotional material of competitors before July 2000.
I think it likely that during the first half of 2000, Mrs Dimasi did see promotional material published on behalf of the plaintiff at that time which included the trade mark and I so find. I also find that when she made the drawing in her diary on 10 July 2000, she had already seen the plaintiff’s trade mark and was aware of the name The National Opal Collection. I reject her evidence to the contrary.
Later in her evidence, she said that the border in her drawing was not necessarily to represent an opalized border but more a coloured border. I accept that the border in the promotional material used by the defendant with the words “The Australian Opal Collection” was an opalized border and not merely a coloured border. I do not think Mrs Dimasi was being truthful when she refused to accept this drawing included what was to be an opalized border. Also, she refused to acknowledge that the drawing was of a plaque, although she said that it could be a plaque.
In my view, there is a striking resemblance between the plaintiff’s trade mark and the rough drawing in the diary in important respects. I reject the evidence of Mrs Dimasi to the contrary, although she did concede that the mark and the drawing were similar.
Also, I think it is significant that prior to the creation of the signs and publications of the defendant which are the subject of these proceedings, the signs and promotional material of the defendant used in his business did not use an opalized border.
Having considered all of the evidence, I have concluded that Mrs Dimasi did want signs and promotional material for the new King William Street premises to be elegant. She had seen the plaintiff’s trade mark which may be so described and she sketched it in her diary and adopted the name “Collection” to be used for the business at King William Street. The evidence does not enable a finding that Mrs Dimasi saw the plaintiff’s premises at Pitt Street Mall in Sydney and the signs incorporating the trade mark before she drew the sketch in the diary on 10 July 2000, but I am satisfied that she had seen the trade mark in colour in promotional material before that time and was presumably impressed by it. I am also satisfied that she had, and exercised, influence over her husband in promotional matters concerning the business. As has been seen, the name used by the defendant for his business in Sydney was “The Australian Opal Exchange”. I accept that Mrs Dimasi did not like that name. The printed promotional material and signs of the defendant using the name “The Australian Opal Collection” were undertaken after Mrs Dimasi and the defendant had seen the plaintiff’s trade mark in promotional material of the plaintiff.
Plaintiff and defendant are competitors

I accept that the defendant’s business, including The Australian Opal Collection, competes with the plaintiff’s business The National Opal Collection. The defendant said that 95 to 98 per cent of his customers were international tourists and many of them arrived elsewhere and came to his premises through cities such as Melbourne and Sydney which is consistent with evidence as to the movement of international tourists in Australia.
The defendant continues to carry on his business of Opals of Australia International, The Australian Opal Exchange and The Australian Opal Collection.
Publications of the Defendant
The defendant had business cards prepared for the business in Sydney in the name of The Australian Opal Exchange and showing his name, the name of his wife and the names of two other persons who were to work at the York Street premises after they opened. An opal is depicted on those cards. According to the defendant, it is a photograph of an opal which the defendant had owned for about 12 years. The cards were printed by Gillingham Printers in Adelaide.
I accept the evidence of Mr Lymn of Gillingham Printers who undertook work for the defendant from time to time. On 15 August 2000, the defendant contacted him and asked that he prepare business cards and display materials for his premises in Sydney and the premises in Adelaide. He left a copy of Mr Andrew Cody’s book with Mr Lymn. The cards and materials were designed by Gillingham Printers and approved by Mr Dimasi.
The card shows the address of his business and shop premises at 14 King William Street, Adelaide and telephone numbers. It contains the words “Exporters. Wholesalers, Retailers of Exclusive Opals and Jewellery” in black printing on a white background. It has an opalized border which is identical with the border of the title of Mr Andrew Cody’s book, except that it is narrower and does not use the full width of the border on the book. These cards were designed and printed by Gillingham Printers at the same time as the business cards and the pin card for the Sydney premises and the design was approved by the defendant. They were printed a little after 28 August 2000. I shall refer to the business cards as “the white business cards”. According to the defendant, Mr Lymn delivered them to him on or about 1 or 2 September 2000.
At the time of receiving instructions, the defendant gave to Mr Lymn a soft cover copy of Mr Andrew Cody’s book. I accept Mr Lymn’s evidence that the defendant told him that the stationery had to be designed using the opalized border on the book and with “that style and that material”. He told Mr Lymn that he needed the border produced on the business card. He told Mr Lymn that he wanted the book back in a hurry “because it is the Bible for the opal profession and it is valuable book”. The defendant said in evidence that he knew that Mr Andrew Cody was a prominent figure in the opal industry. Also, he said that he knew the copyright of the book was vested in someone else. I mention that inside the book, before the foreword, it is printed that Andrew Cody Pty Ltd has the copyright and that no part of the publication “may be reproduced or transmitted in any form or by any means stored in a retrieval system without prior written permission of Andrew Cody Pty Ltd”. The defendant acknowledged that he was not free to copy any part of the book.
The defendant denied that he told Mr Lymn to copy or reproduce the opalized border on the front cover of the book. He said that he could not recall exactly what he said but it would have been that the opalized border on the book was what he liked and he asked him to prepare business cards or stationery with that concept in mind. I reject that evidence. I prefer the evidence of Mr Lymn.
The design work was undertaken by Mr Armsden who regularly did work for Gillingham Printers. The book was given to him and Mr Lymn instructed him to copy the opalized border on the book. His designs were then approved by the defendant.
I accept the evidence of Mr Lymn that the book was placed on a flat-bed scanner and the border was obtained for use in the design. That border was used in the business cards.
Later, the defendant required further business cards, pin cards, letterhead and a pad to be designed and printed for his business The Australian Opal Collection at 14 King William Street, Adelaide. They were produced by Gillingham Printers on 12 January 2001. The letterhead and pad showed the photograph of the opal surrounded by the words “The Australian Opal Collection” on white background. At the bottom of the page is directory information, below which is an opalized border which Mr Lymn said was scanned from Mr Andrew Cody’s book. The business cards and pin cards are on a black background with the same photograph of the opal surrounded by the words “The Australian Opal Collection” showing the defendant’s name on one card and the names of other persons associated with his business on other business cards and directory information for the King William Street premises with an opalized border at the top and the bottom of the business cards and the pin cards. Those borders were also taken from the scan of Mr Andrew Cody’s book. The defendant developed these designs in conjunction with Mr Lymn. I shall refer to these business cards as “the black business and pin cards”.
The defendant also had printed and used a single page voucher in the form of a card advertising his business styled The Australian Opal Collection. The top part has an opalized border at the top and bottom which is identical to part of the opalized border on the front of Mr Cody’s book. It shows the picture of an opal surrounded by the words The Australian Opal Collection printed in gold on a black background. There is a gold line separating the opalized border at the top and the bottom from the black background. Also printed on the black background is:
“While visiting South Australia, the capital of the world for opals, you are invited to view our exclusive collection of rare black investment opals, boulder, crystal opals and hand crafted jewellery.”
The words underlined are printed in gold and the other words are printed in white. Below these words is printed the following in green colour:
“Receive a free opal gift and 12% discount with every purchase.”
I shall refer to this publication as “the vouchers”. Other information, including directory information, then appears on this part of the brochure. The bottom part has a white background and a map of the location of the defendant’s premises in King William Street is printed.
I have proceeded on the basis that the plaintiff has included the vouchers as particulars of its causes of action and they were used as promotional material by the defendant.
Four other documents of the defendant were admitted into evidence. They all have an opalized border at the top or the top and bottom which was not copied from the plaintiff’s book. They are letterhead, a note pad, a business card for an employee and a large brochure. They all have the picture of the opal surrounded by the words “The Australian Opal Collection” and two of them have those and some other words printed in gold on a black background with the opalized border separated from the black background by a gold line. The letterhead and the note pad are printed on white paper with the same picture and words. None of these publications are the subject of the plaintiff’s causes of action.
The defendant’s signs
In August 2000 the defendant arranged with Mr Anthony of Dispex Signs Pty Ltd (“Dispex”) for the design and production of two light box signs for the premises at 14 King William Street, Adelaide. Each of them was an acrylic sign that fitted into a light box. One of these signs was erected high on the building and was long and rectangular in shape. Only the word “Opals” was placed on the sign vertically in a dark colour against a light background. This sign is not the subject of any complaint in this action. The other sign was also rectangular in shape but broader than the other sign. The signs were completed and delivered in early to mid-September 2000. The second mentioned sign had an opalized border.
According to Mr Anthony, the defendant gave him his card which had an opalized border and a book. I accept that the card was one of the white business cards and the book was Mr Andrew Cody’s book. Mr Anthony said that it was his recollection that he was also handed a business card with a black background but I think that is unlikely as other evidence discloses that the black business cards were not produced until 2 January 2001. The defendant gave instructions to Mr Anthony as to the style which he wanted and the information to be placed on the signs. He instructed him to copy the opal border appearing on the front of the book and to use the word “Opal” in larger letters than the other words. The defendant saw the designs as they developed and eventually approved them. The signs were then produced. The opalized border was scanned on to vinyl which was placed on the sign. The defendant provided the words “The Australian Opal Collection”.
The sign which was produced is as appears:
For the same reason as mentioned earlier, it has not been possible to produce the colours in the sign in these reasons.
This sign was erected in a prominent position on the King William Street side of the building at about the level of the top of the ground floor. It overhung the footpath of King William Street and was prominent to foot and vehicular traffic in the street. I shall refer to this sign as “the first elevated sign”.
It can be seen that it has a wide opalized border surrounding a black background upon which appears the words “THE AUSTRALIAN OPAL COLLECTION”. The opalized border was taken from Mr Andrew Cody’s book. The defendant accepted in cross-examination that it is obvious to the eye that that opalized border on the first elevated sign was a copy of the opal border which appeared on the front of Mr Andrew Cody’s book.
On the instructions of the defendant, in early 2001 Dispex also designed and produced a sandwich board which had the same sign on each side and was mounted on a frame which stood on the footpath outside of the defendant’s premises at 14 King William Street, Adelaide. It had the same opalized border as the first elevated sign and contained the picture of the defendant’s opal surrounded by the words “The Australian Opal Collection” in the colour gold and below which appear the words “Duty Free” and “Opals”, the latter being in large font. These words are in white and the background to the sign within the opalized border is black. It was completed and delivered to the defendant before 15 February 2001 and I shall refer to it as “the sandwich board”.
The defendant acknowledged that opalized borders on the white business cards, the first elevated sign and the sandwich board were copied from Mr Andrew Cody’s book.
The defendant also instructed Dispex to design and produce an opalized adhesive strip which was inserted between aluminium strips running across the front of the defendant’s premises at 14 King William Street, Adelaide, just over the entrance doors and the front windows. I shall refer to this strip as “the opalized adhesive strip”. I accept the evidence of Mr Anthony that the strip was prepared from the opalized borders taken from Mr Andrew Cody’s book as already used in the first elevated sign and the sandwich board.
On 20 April 2001 the plaintiff’s solicitors wrote to the defendant on behalf of the plaintiff. In this letter they set out the nature of the business of the plaintiff known as The National Opal Collection which, it was asserted, was well known. I need not set out all of the matters raised in the letter but I mention those relevant for present purposes. They complained about the defendant using the opalized border which had been taken from Mr Andrew Cody’s book and the use of the name “The Australian Opal Collection”. They stated that given the reputation of the business name, The National Opal Collection and the logo, the use of the similar name by the defendant and the identical opalized border was likely to mislead and deceive persons into believing that the defendant’s business was, or was associated with, the plaintiff’s business. It was asserted that this conduct of the defendant constituted actionable passing off and misleading or deceptive conduct and false representation of a sponsorship, approval or affiliation under the Trade Practices Act 1974 (Cth) and the Fair Trading Act. Loss and damage by the plaintiff was claimed. Undertakings from the defendant were sought including to cease using the name The Australian Opal Collection and the depiction of the opalized border, not to reproduce the artistic work appearing on the front cover of Mr Andrew Cody’s book, and the demand was made to deliver up the signs, stationery and other productions, for damages and costs.
Solicitors for the defendant responded on 30 April 2001 denying the allegations and rejecting the requests and demands.
In about August or September 2001 the defendant engaged Dispex to alter the sandwich board sign and the first elevated sign. The latter was altered by removing the opalized border and replacing it with a strip of another opalized border at the top and bottom of the sign. The words “THE AUSTRALIAN OPAL COLLECTION” in white on a black background remained. The sandwich board was removed and a smaller free standing sign with an opalized background at the top and bottom was prepared and used outside the defendant’s premises with the words “DUTY FREE OPALS” in white on a black background.
An invoice from Dispex to the defendant’s business Australian Opal Collection dated 18 September 2001 raised the charge for this work. According to Mr Anthony, the altered signs would have been delivered to the defendant shortly before the invoice was sent.
The altered light box sign is as appears:
The colours in this sign have not been reproduced for the reason earlier mentioned.
This sign was erected in the same place as the first elevated sign after it had been removed. I shall refer to it as the second elevated sign.
The plaintiff commenced this action on 29 May 2002 and the Statement of Claim pleading the various causes of action and the factual bases for them was filed at the same time. There is no evidence as to when the pleadings were served on the defendant but I accept that service occurred promptly because the plaintiff’s solicitor wrote to the defendant’s solicitor on 25 July 2002 and referred to the Statement of Claim. By this time the defendant was aware of all of the allegations and complaints made by the plaintiff.
In this letter the plaintiff asserted that the defendant continued to breach copyright of the plaintiff in the opalized border by the use of the opalized adhesive strip across the shopfront of his premises. A further demand was made that he cease to infringe the plaintiff’s copyright and the trade mark. The defendant did not contact Mr Anthony about the opalized adhesive strip until about 10 months after the further demand, but it has not been removed.
I accept that the defendant did not act promptly to alter the first elevated sign and the sandwich board. Instructions were not given by him to Mr Anthony until August 2001. Also, he did not take any steps to cease to use the black business card. The second elevated sign has remainded in place at the defendant’s premises in King William Street.
I reject the defendant’s evidence that as soon as he found out there was an infringement of copyright or potential infringement, he changed “everything” so that there would not be such an infringement and he would not be at risk.
Observations of the signs by persons familiar with the plaintiff’s mark
Mr Rantzos is an opal dealer who purchases opals in opal fields and sells them to other opal dealers, opal shops and manufacturers of opal jewellery. He has been involved in the opal industry for nearly 30 years and has known Mr Andrew Cody for about 28 years. He is familiar with the business The National Opal Collection.
On 7 September 2000 he was in Adelaide on business and visited the premises of the business known as Opal Field Gems in King William Street carried on by Mr and Mrs Lianos. Mr Lianos asked him if Mr Cody had opened a shop in Adelaide. Mr Rantzos saw the defendant’s premises at 14 King William Street, Adelaide and the signs, including the first elevated sign.
Having seen that sign, he thought that the shop had been opened by Mr Cody. I assume both men were referring to Mr Andrew Cody. I accept that they regarded him and the plaintiff as one and the same regarding ownership of the business The National Opal Collection. It was the opal colours and border, the black background and the words “the opal collection” which led him to that conclusion. He reported what he had seen to Mr Andrew Cody. He explained that it was the shape of the letters and the way in which they were put together and the opal borders that led him to that view.
In cross-examination he accepted that in his experience the word “opal” in a sign attracts people to opal shops and that people in the jewellery, or precious stones business, sometimes refer to their range of goods as a “collection” and it is common for the words “Australian opals” to be used in signs.
Mr Stadler is the proprietor of the business known as “Gone Bush Gems Company” at Unley in this State. He is a wholesaler of opals and has dealings with retailers, wholesalers and exporters of opal. He has had dealings with the plaintiff. He was invited to attend the opening of The National Opal Collection in Sydney in August 2000 but did not do so. In late 2000 he was driving through King William Street and he saw the first elevated sign on the defendant’s premises. He thought it was the plaintiff’s sign. He said he did not read the word “Australian” exactly, but the overall appearance of the sign was the same as the plaintiff’s sign incorporating its trade mark. He formed that conclusion based upon the concept of the sign, the opalized border, the type of writing and the background. He thought the plaintiff had opened a shop in Adelaide. Eventually he spoke to Mr Damien Cody about the sign.
Mr Stadler acknowledged that it is common to refer to opals mined in Australia as Australian opals. He also acknowledged that he was familiar with the design of Mr Andrew Cody’s book and had been invited to the opening of the plaintiff’s business The National Opal Collection in Sydney. He had seen the opalized border on the cover of the book. It was suggested that for those reasons he associated the defendant’s sign with the plaintiff and he said that was probably correct. I have interpreted Mr Stadler’s evidence as meaning that when he saw the first elevated sign, he formed the impression that it was the plaintiff’s sign.
Mrs Lianos and her husband are the proprietors of the business known as “Opal Field Gems Mine and Museum” at 33 King William Street, Adelaide which is near the intersection of King William Street, Hindley Street and Rundle Mall. They have both been involved in the opal industry for many years and are mainly retailers of opal to overseas tourists.
She is familiar by sight with the nature of the business conducted by the defendant in King William Street. She and her husband had a copy of Mr Andrew Cody’s book and she was familiar with the sign used for the business The National Opal Collection by the plaintiff in Sydney.
She first saw the defendant’s first elevated sign at the King William Street premises before the Olympic Games. She thought it was the plaintiff who had erected it. It drew her mind to Mr Andrew Cody’s book and she thought he had set up business in Adelaide. It was similar to signs used at his business in Sydney in readiness for the Olympic Games. The evidence does not disclose the signs to which she was referring. Mrs Lianos said that it was possible that she had seen a sign at the defendant’s premises to the effect that “The Australian Opal Collection” was coming soon. That name did not mean anything to her at the time. The first elevated sign appeared some weeks later. It was the opalized border which reminded her of Mr Andrew Cody’s book.

Ms Thornton-Cohen is an advertising sales representative for a company which published books placed in hotel rooms throughout Australia. She travelled around Australia over a period of about five years selling advertising space in the books. She developed a familiarity with opal shops in Australia.
She visited Adelaide on 2 September 2003 and saw the defendant’s premises in King William Street and the second elevated sign which remains erected on the defendant’s premises. She believed the sign to be advertising the plaintiff’s business as The National Opal Collection and that Mr Andrew Cody had opened a shop in Adelaide. She made an entry in her diary for that day to ask him about the Adelaide shop.
Ms Thornton-Cohen was familiar with the plaintiff’s business The National Opal Collection. She said that the overall appearance of the defendant’s sign was the same as the plaintiff’s sign for The National Opal Collection. She thought it was his shop.
Mr Pledge is a former curator of fossils at the South Australian Museum having retired in January 2001. He has known Mr Andrew Cody since 1987 and is familiar with the plaintiff’s business. He established a small exhibition as to Australian dinosaurs and when he met Mr Cody he saw specimens of dinosaur bones and teeth. He became aware of the plaintiff’s business and premises in Sydney and he attended those premises. He was interested in the specimens on display.
In early 2003 he was in King William Street in Adelaide. He saw the second elevated sign and thought of Mr Andrew Cody. Two or three weeks later, when he spoke to him, he told him that he had seen it and that he was obviously setting up a branch in Adelaide which Mr Cody denied. Mr Pledge said that it was the words “The Australian Opal Collection” which made him think of the plaintiff’s business. He thought that Mr Cody was putting together an opal display in Adelaide like the display in Sydney. He regarded Mr Cody and The National Opal Collection as synonymous.
Mr Rynes is one of the proprietors of the business known as “The Opal Gem Factory” at the Beehive Corner in King William Street. The business includes the manufacture and wholesale and retail selling of opal jewellery. He has been involved in the business for about 30 years.
Before the Olympic Games he observed the fit out and establishment of the defendant’s business premises at 14 King William Street in Adelaide. His recollection is that a black and white sign “Opals Collection in Australia” was erected at the front with a sign “Opening Soon”. He interpreted these signs as indicating that the plaintiff was commencing business at the premises, namely Mr Andrew Cody.
Later, he saw the first elevated sign and identified it with the plaintiff’s business elsewhere, presumably referring to the business in Sydney and possibly Melbourne.
I accept the evidence of these witnesses.
Infringement of trade mark
I have mentioned the registration of the plaintiff’s trade mark in consequence of which the plaintiff, as the registered owner, had, and continues to have, exclusive rights to use the trade mark and to authorise other persons to use it: s 12, Trade Mark Act 1995 (Cth). The trade mark is registered without any limitation as to colour and by virtue of s 70(3) of the Act is taken to be registered for all colours: see Wingate Marketing Ltd v Levi Strauss & Co (1994) 49 FCR 89 at 127.
S 120(1) of the Act provides for the circumstances in which a person infringes a registered trade mark in circumstances such as in the present case:
“s 120(1) A person infringes a registered trade mark if the person uses as a trade mark a sign that is substantially identical with, or deceptively similar to, the trade mark in relation to goods or services in respect of which the trade mark is registered.”
“Deceptively similar” is defined in s 10 of the Act. It provides:
“s 10For the purposes of this Act, a trade mark is taken to be deceptively similar to another trade mark if it so nearly resembles that other trade mark that it is likely to deceive or cause confusion.
I mention other relevant provisions of the Act:
“s 122(1)In spite of section 120, a person does not infringe a registered trade mark when:
(a)     the person uses in good faith:
(i)the person's name or the name of the person's place of business;
or
(ii)the name of a predecessor in business of the person or the name of the predecessor's place of business; or
(b)    the person uses a sign in good faith to indicate:
(i)the kind, quality, quantity, intended purpose, value, geographical origin, or some other characteristic, of goods or services; or
(ii)the time of production of goods or of the rendering of services; or
(c)    the person uses the trade mark in good faith to indicate the intended purpose of goods (in particular as accessories or spare parts) or services.”
Other provisions set out in subs (1)(d) to (g) inclusive and subs (2) have no relevance for present purposes.
“s 126The relief that a court may grant in an action for an infringement of a registered trade mark includes:
(a)an injunction, which may be granted subject to any condition that the court thinks fit; and
(b)at the option of the plaintiff but subject to section 127, damages or an account of profits.
S 127 provides for circumstances in which damages may not be awarded upon infringement of a trade mark but this section has no application to the present case.
The claim of the plaintiff for infringement of the trade mark is limited to the first elevated sign and the second elevated sign. It is not suggested that either of these signs is identical to the plaintiff’s mark. What is claimed is that each of them is substantially identical to the plaintiffs’ mark or deceptively similar to it. The signs and the mark relate to the goods, namely opal, in respect of which the mark is registered.
The tests to be applied were discussed by Windeyer J in The Shell Company of Australia Limited v Esso Standard Oil (Australia) Limited (1961) 109 CLR 407. He said at 414:
“In considering whether marks are substantially identical they should, I think, be compared side by side, their similarities and differences noted and the importance of these assessed having regard to the essential features of the registered mark and the total impression of resemblance or dissimilarity that emerges from the comparison. ‘The identification of an essential feature depends’, it has been said, ‘partly on the Court’s own judgment and partly on the burden of the evidence that is placed before it’: de Cordova v Vick Chemical Co (1951) 68 RPC 103, at p 106. Whether there is substantial identity is a question of fact: see Fraser Henleins Pty Ltd v Cody (1945) 70 CLR 100, per Latham CJ at pp 114, 115, and Ex parte O’Sullivan; Re Craig (1944) 44 SR (NSW) 291, per Jordan CJ at p 298, where the meaning of the expression was considered.”
At 415, he said:
“On the question of deceptive similarity a different comparison must be made from that which is necessary when substantial identity is in question. The marks are not now to be looked at side by side. The issue is not abstract similarity, but deceptive similarity. Therefore the comparison is the familiar one of trade mark law. It is between, on the one hand, the impression based on recollection of the plaintiff’s mark that persons of ordinary intelligence and memory would have; and, on the other hand, the impressions that such persons would get from the defendant’s television exhibitions. To quote Lord Radcliffe again: ‘The likelihood of confusion or deception in such cases is not disproved by placing the two marks side by side and demonstrating how small is the chance of error in any customer who places his order for goods with both the marks clearly before him … It is more useful to observe that in most persons the eye is not an accurate recorder of visual detail, and that marks are remembered rather by general impressions or by some significant detail than by any photographic recollection of the whole’: de Cordova v Vick Chemical Co (1951) 68 RPC, at p 106.”
Windeyer J went on to refer, with approval, to the observations of Dixon and McTiernan JJ in Australian Woollen Mills Ltd v FS Walton & Co Ltd (1937) 58 CLR 641, as follows at 658:
“In deciding this question, the marks ought not, of course, to be compared side by side. An attempt should be made to estimate the effect or impression produced on the mind of potential customers by the mark or device for which the protection of an injunction is sought. The impression or recollection which is carried away and retained is necessarily the basis of any mistaken belief that the challenged mark or device is the same.”
Although the decision of Windeyer J in the Shell Case was overturned on appeal, there was no criticism of the observations to which I have referred. They were adopted by Gummow J in Wingate Marketing at 128-129 and by the Full Court of the Federal Court in CA Henschke & Co & Ors v Rosemount Estates Pty Ltd (2000) 52 IPR 42.
I first consider whether the first elevated sign is substantially identical with the plaintiff’s trade mark. As has been seen, this task must be undertaken by comparison of the sign and the mark. There are differences. Unlike the mark, the sign does not have the appearance of a plaque. The sign is vertically rectangular and the mark is rectangular horizontally. Unlike the mark, the sign does not have an external brass-looking border and four studs. The opalized border and the black background on the mark have a concave indent at each corner. The sign does not have that feature. The opalized borders in the sign and the mark are otherwise similar but not identical. The words in the sign and mark are similar, although they are white in the sign and of brass colour in the mark. The words “OPAL COLLECTION” in both are substantially identical. The definite article “THE” appears in the sign and the mark. Although the words “AUSTRALIAN” and “NATIONAL” are different words, they have the same meaning in the context in which they are used. In my view, the combination of the words “The Australian Opal Collection” and “The National Opal Collection” each describe the same concept.
I have proceeded on the basis that the plaintiff does not rely upon the sandwich board as an infringement of the trademark. In any event, it is not substantially identical to the plaintiff’s trade mark. The words “The Australian Opal Collection”, whilst having the same meaning as “The National Opal Collection”, are laid out in a substantially different way from the words in the mark which does not contain the other words in the sandwich board sign.
Having made this comparison, I do not think the first elevated sign and the mark are substantially identical. The differences between them prevents that conclusion. The same must be said regarding the second elevated sign and the plaintiff’s trade mark. In addition to the differences between the first elevated sign and the mark, there are other differences. There is a light coloured border around the whole of the second elevated sign of light coloured metal appearance but dissimilar to brass. The opalized border is at the top and the bottom of the sign only unlike the mark where the border is at all of the edges.
I now turn to consider if either of the first elevated sign or the second elevated sign is deceptively similar to the plaintiff’s mark. As has been seen, the question is whether the sign under consideration so nearly resembles the plaintiff’s trade mark that it is “likely to deceive or cause confusion”: s 10. In my view, “persons of ordinary intelligence and memory” would have the impression that the plaintiff’s work and the signs are the same: the Shell case per Windeyer J at 415. As was observed by Dixon and McTiernan JJ in Australian Woollen Mills, the impression or recollection which is carried away and retained is the basis of any mistaken belief.
In de Cordova and Ors v Vick Chemical Co (1951) 68 RPC 103 Lord Radcliffe said at 105-106:
“They have not used the mark itself on the goods that they have sold, but a mark is infringed by another trader if, even without using the whole of it upon or in connection with his goods, he uses one or more of its essential features. The identification of an essential feature depends partly on the Court’s own judgment and partly on the burden of the evidence that is placed before it.”
I also mention the observations of the Full Court of the Federal Court in MID Sydney Pty Ltd v Australian Tourism Company Ltd & Ors (1998) 90 FCR 236 at 245:
“It is true, in infringement proceedings, that the question to be asked is in one respect at least somewhat artificial: the person who may be caused to wonder is not one who knows of the actual business of the proprietor of the registered mark, the goods it produces or the services it provides, but one who is to be credited with a recollection of the mark in relation to the full range of goods or services to which the registration extends. That degree of artificiality can be justified on the ground that it is necessary in order to provide protection to the proprietor’s statutory monopoly to its full extent.”
In CA Henschke & Co, the Full Court of the Federal Court considered the present legislation and said at 61:
“If a mark is in fact or from its nature likely to be the source of some name or verbal description by which buyers will express their desire to have the goods, then similarities both of sound and of meaning play an important part. The usual manner in which ordinary people behave must be the test of what confusion or deception may be expected. Potential buyers of goods are not to be credited with any high perception or habitual caution. On the other hand, exceptional carelessness or stupidity may be disregarded. The course of business and the way in which the particular class of goods are sold gives, it may be said, the setting, and the habits and observation of men considered in the mass affords the standard. Evidence of actual cases of deception, if forthcoming, is of great weight.”
The Court then adopted observations of Windeyer J in the Shell case and went on to say [paras 42, 43 44]:
“Windeyer J added, at CLR 416; IPR 529, that ‘[the] deceptiveness that is contemplated must result from similarity; but the likelihood of deception must be judged not by the degree of similarity alone but, by the effect of that similarity in all the circumstances’. Thus, for instance, although the present TM Act contains no analogue of s 66 of the Trade Marks Act 1955 (Cth), it is still true that questions of deceptive similarity must be considered against the background of the usages in the particular trade.”
I have had regard to the observations in these cases.
I have previously mentioned differences between the plaintiff’s mark and each of the first elevated sign and the second elevated sign, but applying the approach discussed in the cases, I am satisfied that both of these signs are deceptively similar to the plaintiff’s mark. Undoubtedly, there are differences between the first elevated sign and the second elevated sign and there is a greater similarity between the plaintiff’s mark and the first elevated sign but the similarity between the second elevated sign and the plaintiff’s mark is sufficiently similar as to pass the test in s 10 and the tests discussed in the cases.
These conclusions have been reached independently of the evidence of the persons familiar with the plaintiff’s mark which I have mentioned, but are strengthened by that evidence.
As has been seen, s 122 of the Act provides for circumstances in which a person does not infringe a registered trade mark. It is only s 122(1)(b) and (c) which needs to be considered in the present case.
It is the defendant’s case that he used the first elevated sign and the second elevated sign in good faith and they were not used with the ulterior motive of taking advantage of the plaintiff’s name.
In support of this contention the defendant points to the following matters. Despite intensive cross-examination, he maintained his evidence that he did not know of the plaintiff’s business The National Opal Collection at the time he adopted his business name The Australian Opal Collection. Mrs Dimasi’s evidence was similar. I do not accept the evidence of the defendant and Mrs Dimasi that they were not aware of the plaintiff’s business in Sydney or its name when the name “The Australian Opal Collection” was selected and registered.
I have mentioned the evidence of the defendant and Mrs Dimasi as to their intention to develop an elegant upmarket jewellery shop and the reason for the selection of the word “collection” in the name of the new business. Whilst I have not rejected their evidence about their intentions for the new shop, I am satisfied that they were aware of the plaintiff’s business in Sydney and its name.
I have mentioned my findings as to how the signs came into existence and the role played by the defendant.
The sketch made by Mrs Dimasi on 10 July 2000 in the diary is instructive. The name used by her is the same as in the plaintiff’s mark except that “AUSTRALIAN” is used instead of “NATIONAL”. It may be accepted that the defendant had decided to use the name “The Australian Opal Collection” by this time.
Whilst the plaintiff had only been trading in Sydney as The National Opal Collection for about two months at the time the sketch was made and the defendant registered the name “The Australian Opal Collection”, as has been seen the plaintiff had undertaken extensive promotion of its business using its mark for a considerable period. I am satisfied that both the defendant and his wife had ample opportunity to encounter the plaintiff’s mark before 10 July 2000. Comparison of the sketch and the mark indicates that the former was brought into existence with knowledge of the latter. Also, I accept that Mrs Dimasi, in her rough sketch, was attempting to portray the indentation at each corner of the opalized border present in the plaintiff’s mark.
I accept the evidence of Mr Andrew Cody that in his vast experience in the industry, he was not aware of anyone using the business name “The Opal Collection” or “Opal Collection” and he rejected the suggestion in cross-examination that it was common for the latter expression to be used by an opal retailer in a business name. However, he said that he had seen material presented by the defendant at the commencement of the trial in which “opal collection” had been used. Mr Damien Cody’s evidence was to a similar effect, except that he did recall having heard of the name “JAK Opal Collection” but he could not remember where. Mr Damien Cody said that he had not seen any promotional material using an opalized border, except as used by the plaintiff and the defendant.
The defendant also submitted that the differences between the plaintiff’s mark and his two signs indicate that he had no ulterior motive in using the signs. He did not use the image of a brass plate. His explanation for the larger size of the word “opal” was to attract customers and not to copy the plaintiff’s mark is plausible. There is nothing in his signs suggestive of the existence of a museum which is a feature of the plaintiff’s business. The defendant’s cards have not used the plaintiff’s mark.
The defendant points to his evidence that originally the first elevated sign was to use black letters on a white background. Mr Anthony gave evidence that he had a vague recollection to that effect. According to the defendant the sign would have been very bland and so he decided to change it to white lettering on a black background to make it more prominent. I have considered these matters but they do not indicate a lack of ulterior purpose.
It was submitted by the defendant that the sandwich board used by him did not bear the slightest resemblance to the plaintiff’s mark, which indicates that the defendant did not intend to use signs which infringe the plaintiff’s mark. No such conclusion can be drawn from the features of the sandwich board. It does have similarities to the plaintiff’s mark in the use of the opalized border and the black background but in most other respects is different. However, the use of another sign which is dissimilar does not permit the conclusion that the first elevated sign and the second elevated sign, which I have concluded, are deceptively similar to the plaintiff’s mark, were used in good faith.

The last matter advanced by the defendant is that the second elevated sign was designed and used in September 2001 after the plaintiff complained to the defendant about the first elevated sign. I have mentioned that the complaint was made on 20 April 2001. As has been seen, the defendant rejected the complaint. He refused to give the undertakings which were sought. The defendant did not replace the first elevated sign or the sandwich board until September 2001. It is submitted that his response to the complaint suggests that he had no ulterior purpose in using the first elevated sign or the second elevated sign.
I reject the contention of the defendant that he used the first elevated sign and the second elevated sign in good faith without the ulterior motive of taking advantage of the plaintiff’s name.
I mention one other matter. This defence is available only “where descriptive words are used descriptively”: Caterpillar Loader Hire (Holdings) Pty Ltd & Ors v Caterpillar Tractor Co (1983) 48 ALR 511 at 514. In FH Faulding & Co Ltd v Imperial Chemical Industries of Australia & New Zealand Ltd (1964) 112 CLR 537, McTiernan J observed, as to the predecessor of s 122, at 543:
“What this provision protects is the use of a mark that is genuinely descriptive of the character or quality of goods in connection with which it is used, when the use is purely for the purposes of description.”
I accept the submission of the plaintiff that the name “The Australian Opal Collection” is not used descriptively but as a trade mark. The name is not used solely for the purpose of describing its goods and services.
The defendant is not entitled to the protection of s 122.
I find that the use by the defendant of the two elevated signs infringed the plaintiff’s mark.
Copyright infringement
As has been seen, the plaintiff is, and has been, the owner of the copyright of the opalized border on the front cover of Mr Andrew Cody’s book.
The plaintiff claims that the defendant, without licence, authority or consent of the plaintiff displayed on or about his business premises, in the production of signs, business cards and promotion and marketing materials bearding an opalized coloured border being a reproduction of the opalized border on the front cover of Mr Cody’s book and this conduct infringed the plaintiff’s copyright.
I have mentioned the circumstances of the production of the defendant’s business cards and other promotional materials for his King William Street and Sydney premises where the opalized border taken from Mr Cody’s book was used.
Copyright, in the circumstances here relevant, does not subsist otherwise than by virtue of the Copyright Act 1968 (Cth). The plaintiff’s claim relates to a work. That expression is defined in s 10 as meaning “a literary, dramatic, musical or artistic work”. “Artistic work” is defined in that section as, inter alia, “a painting, sculpture, drawing, engraving or photograph, whether the work is of artistic quality or not”. S 10 also provides that the author in relation to a photograph means the person who took the photograph and that “photograph” means a product of photography or of a process similar to photography, other than certain matters which are not relevant for present purposes.
S 14 of the Act provides:
“14 (1) In this Act, unless the contrary intention appears:
(a)a reference to the doing of an act in relation to a work or other subject-matter shall be read as including a reference to the doing of that act in relation to a substantial part of the work or other subject-matter; and
(b)a reference to a reproduction, adaptation or copy of a work shall be read as including a reference to a reproduction, adaptation or copy of a substantial part of the work, as the case may be.
(2) This section does not affect the interpretation of any reference in sections 32, 177, 180, 187 and 198 to the publication, or absence of publication, of a work.”
S 31(1)(b) provides:
“31(1) For the purposes of this Act, unless the contrary intention appears, copyright, in relation to a work, is the exclusive right:
(b)in the case of an artistic work, to do all or any of the following acts:
(i)to reproduce the work in a material form;
(ii)to publish the work;
(iii)to communicate the work to the public.”
S 35 relates to the ownership of copyright in original work. S 35(2) provides:
“35(2)    Subject to this section, the author of a literary, dramatic, musical or artistic work is the owner of any copyright subsisting in the work by virtue of this Part.”
S 36(1) provides that, inter alia, that copyright in an artistic work is infringed by a person who, not being the owner of the copyright, and without the licence of the owner of the copyright, does or authorizes the doing in Australia of, any act comprised in the copyright. S 36(1A) provides:
“1AIn determining, for the purposes of subsection (1), whether or not a person has authorised the doing in Australia of any act comprised in the copyright in a work, without the licence of the owner of the copyright, the matters that must be taken into account include the following:
(a)    the extent (if any) of the person’s power to prevent the doing of the act concerned;
(b)    The nature of any relationship existing between the person and the person who did the act concerned;
(c)    whether the person took any reasonable steps to prevent or avoid the doing of the act, including whether the person complied with any relevant industry codes of practice.”
The opalized border used in the subject publications and signs of the defendant is plainly an “artistic work”. I have described the process by which the border shown on Mr Andrew Cody’s book was created by the use of a photograph of an opal and the selection and putting together of parts of the photograph. I have also described the process by which the opalized border in that book was used in compiling the opalized borders used by the defendant which are the subject of complaint. I accept that it was reproduced in the relevant sense pursuant to s 14. I adopt the observations of Megarry J in British Northrop Limited & Ors v Texteam Blackburn Limited & Ors [1974] RPC 57 at 72:
“…. I do not think that the word ‘reproduction’, in its normal use, carries any necessary implication of exactitude of likeness between that which is reproduced and the reproduction itself. Not every reproduction is a perfect reproduction. It may well be that there must be a high degree of similarity before one thing can be said to be a ‘reproduction’ of another; but I do not think that minor or trivial differences prevent one work from being a ‘reproduction’ of another. It may be that ‘reproduction’ has much the same meaning as ‘copy’, and that it suffices for a ‘reproduction’ if it makes a substantial use of the features of the original work in which copyright subsists; but in the present case I am content to treat ‘reproduction’ as bearing the somewhat stricter meaning than I have indicated.”
I am satisfied that although the whole of the opalized border depicted in Mr Cody’s book was not reproduced on every relevant production and not always with the various parts in the same order, a substantial part of it was reproduced in the defendant’s publications and the relevant signs when assessed in relation to quality of what was taken: Autodesk Inc & Anor v Dyason & Ors (No 2) (1993) 176 CLR 300 per Mason CJ at 305 and also when assessed in relation to quantity. In relation to artistic work, a substantial part of the work must be reproduced: see s 14(1) and Eagle Homes Pty Ltd v Austec Homes Pty Ltd (1999) 87 FCR 415 per Lindgren J, with whom the other members of the Full Court of the Federal Court agreed, at 430. I accept that a substantial part of the photograph was used.
It was submitted on behalf of the defendant that he did not personally reproduce the opalized border and that he can only be liable for breach of copyright under s 36 if he entered into a common design for that purpose with Mr Lymn or he authorised the infringement. I reject the contention concerning common design. The accepted evidence clearly established that the publications were undertaken by Gillingham Printer and the signs were designed and made by Displex upon the direction of the defendant and pursuant to contractual arrangements between him and each of them. I have been assisted by the discussions of the concept of authorization by Sackville J, with whom the other members of the Full Court of the Federal Court agreed, in Nationwide News Pty Ltd & Ors v Copyright Agency Limited (1996) 65 FCR 399 at 422ff. I am satisfied that the defendant expressly instructed the two contractors to do what they did and approved of the result.
It was also submitted on behalf of the defendant that in reproducing the opalized border, as occurred, there was no infringement of the copyright in the border depicted on the cover of Mr Andrew Cody’s book. As has been mentioned, the border was depicted on the cover of the book was produced by selecting segments of the photograph which are repeated around the border to create it. Consequently, it is submitted, the border is an artistic work in itself and what has been copied is all or parts of the border and not the photograph.
In its pleading, the plaintiff alleges that it was the owner of the copyright subsisting in both the opalized border on the front cover of Mr Andrew Cody’s book and the photograph from which it was devised. The defendant does not contest that allegation in his defence but denies that his publications and signs are reproductions of the opalized border.
In my view, the evidence clearly establishes that the opalized border was produced from parts of the photograph which were selected and arranged and used in the publications and signs of the defendant. Parts of it were used by the defendant in his publications and the first elevated sign and in the opalized strip at the front of his premises at 14 King William Street, Adelaide. I have referred to the observations of Megarry J in British Northrop. The resolution of whether there has been a reproduction in the relevant sense is a matter of fact and degree. I am satisfied that there was reproduction in the relevant sense.
I accept that it has been established that the defendant authorised the use of the opalized border in which the plaintiff owned the copyright and thereby infringed the copyright when the white business cards, the first elevated sign, the black business cards, the brochures, the opalized strip on the shop front at the King William Street premises and the sandwich board were brought into existence and used by him. I was referred to L.B. (Plastics) Products Limited v Swish Products Ltd (1979) 1A IPR 359 and SW Hart & Co Pty Ltd v Edwards Hot Water Systems (1985) 159 CLR 466 in support of the proposition that the degree of objective similarity between the plaintiff’s work and the defendant’s work, together with proof the defendant had access to the plaintiff’s work will often raise an inference of copying which shifts the evidential burden to the defendant who is then obliged to show the similarities between the two works are not the result of copying. In view of the clear evidence of copying the opalized border, it is unnecessary to apply this approach.
I conclude that the defendant infringed the plaintiff’s copyright in the opalized border on the front cover of Mr Andrew Cody’s book and the photograph by the production and use of the white business cards, the black business cards and pin cards, the vouchers, the first elevated sign, the sandwich board and the opalized adhesive strip.
Relief for infringement of copyright
S 115(1) of the Act provides that the owner of a copyright may bring an action for infringement of copyright and s 115(2) provides that a court may grant in such an action an injunction and either damages or an account of profits. The following provisions must also be considered:
“115(3)Where, in an action for infringement of copyright, it is established that an infringement was committed but it is also established that, at the time of the infringement, the defendant was not aware, and had no reasonable grounds for suspecting, that the act constituting the infringement was an infringement of the copyright, the plaintiff is not entitled under this section to any damages against the defendant in respect of the infringement, but is entitled to an account of profits in respect of the infringement whether any other relief is granted under this section or not.
(4) Where, in an action under this section:
(a)an infringement of copyright is established; and
(b)the court is satisfied that it is proper to do so, having regard to:
(i)the flagrancy of the infringement; and
(ia)the need to deter similar infringements of copyright; and
(ib)the conduct of the defendant after the act constituting the infringement or, if relevant, after the defendant was informed that the defendant had allegedly infringed the plaintiff’s copyright; and
(ii)whether the infringement involved the conversion of a work or other subject-matter from hardcopy or analog form into a digital or other electronic machine-readable form; and
(iii)any benefit shown to have accrued to the defendant by reason of the infringement; and
(iv)all other relevant matters;
the court may, in assessing damages for the infringement, award such additional damages as it considers appropriate in the circumstances.”
In Lahore Copyright & Designs the learned author says, at paragraph 36,240:
“To obtain the protection of s 115(3) the defendant must establish:
1An active subjective lack of awareness that the act constituting the infringement was an infringement of the copyright; and
2That objectively considered, he or she had no reasonable grounds for suspecting that the act was an infringing act: Milwell Pty Ltd v Olympic Amusements Pty Ltd (1999) 43 IPR 32 at 44.”
He accepts that as to the first limb the defendant must also establish that the lack of awareness must also include that the lack of awareness was related to the existence of the copyright. I accept that view.
I mention that the hurdle for the defendant in s 115(3) is not easily overcome. A mistake of law is not sufficient unless made after reasonable enquiry and investigation: Pollock v JC Williamson Ltd [1923] VLR 225 and Kalamazoo (Aust) Pty Ltd v Compact Business Systems Pty Ltd & Ors (1985) 84 FLR 101. The simplest of enquiries by the defendant, namely perusal of the second page at the front of the book would have put him on notice that copyright subsisted in the plaintiff.
In my view, the defendant could not satisfy either limb. He was actively involved in the reproduction which constitutes the infringement in each publication. As has been mentioned, he was aware that Mr Andrew Cody was the author of the book and of its importance and reputation in the opal business. He was aware of Mr Andrew Cody’s prominence in the industry and that copyright subsisted and was vested in someone other than him, the defendant. Also, as I have mentioned, the owner of the copyright is printed inside the book.
It was submitted on behalf of the defendant that he had engaged a professional sign writer and a professional printer to undertake the work for him. He had informed them of the type of image that he wanted as a border. They were both experienced in such work and neither of them raised any questions of copyright with him. None of those matters, even if proved, could establish the matters in s 115(3). Also, it was submitted that the defendant did not realise that the border produced was a copy taken from Mr Andrew Cody’s book. I have mentioned the relevant evidence, including the evidence of the defendant, and I reject this submission.
As the defendant has not established the matters set out in s 115(3), the remedies available to the plaintiff are injunctive relief and damages or an account of profits. Later I return to the alternative remedies of damages and an account of profits. In my view, the plaintiff is entitled to injunctive relief and damages, if proved, or an account, whichever is appropriate and is justified.
The plaintiff claims that in using the name “The Australian Opal Collection”, his various publications and signs, the defendant committed the tort of passing off and misleading and deceptive conduct in breach of s 56 and s 58(c) and (d) of the Fair Trading Act 1987. It is necessary to consider these causes of action.
Passing off
The plaintiff claims that the defendant used the name, marks, publications and signs so as to induce purchasers to believe that the goods which he was selling were the goods of the plaintiff.
In Erven Warnink BV & Anor v J Townend & Sons (Hull) Ltd & Anor [1979] AC 731 Lord Diplock stated, at 742, that there are five characteristics which must be present in order to create a valid cause of action for passing off:
“(1) a misrepresentation (2) made by a trader in the course of trade, (3) to prospective customers of his or ultimate consumers of goods or services supplied by him, (4) which is calculated to injure the business or goodwill or another trader (in the sense that this is a reasonably foreseeable consequence) and (5) which causes actual damage to a business or goodwill of the trader by whom the action is brought or (in a quia timet action) will probably do so.”
Lord Fraser expressed the cause of action as follows at 755-756:
“It is essential for the plaintiff in a passing off action to show at least the following facts: - (1) that his business consists of, or includes, selling in England a class of goods is clearly defined, and that in the minds of the public, or a section of the public, in England, the trade name distinguishes that class from other similar goods; (3) that because of the reputation of the goods, there is goodwill attached to the name; (4) that he, the plaintiff, as a member of the class of those who sell the goods, is the owner of goodwill in England which is of substantial value; (5) that he has suffered, or is really likely to suffer, substantial damage to his property in the goodwill by reason of the defendants selling goods which are falsely described by the trade name to which the goodwill is attached.”
This statement has been accepted in this country: see Moorgate Tobacco Co Limited v Philip Morris Ltd & Anor (No 2) (1984) 156 CLR 414 per Deane J, with whom the other members of the Court agreed, at 443-444; Conagra Inc v McCain Foods (Aust) Pty Ltd (1992) 33 FCR 302 at 308-310 and Betta Foods Australia Pty Ltd v Betta Fruit Bars Pty Ltd (1998) ATPR 41-624 at 40-839 and 40-840.
The parties by agreement presented their cases at trial on the issue of liability as opposed to damages or an account. At this stage the plaintiff seeks various declarations and injunctions. Damages or an account are left to another day.
It may be seen that the tort of passing off is not established unless there is actual damage is caused to the trade of the plaintiff or that it is likely that such damage will occur. There is, thus far, no evidence of actual damages suffered by the plaintiff due to the infringement of copyright or, indeed, the infringement of the plaintiff’s mark. There is no evidence that the defendant has been enriched by such infringements. An account of profits is discussed by the learned author of Lahore Copyright and Designs. Damages and an account for profits are alternative remedies. An account for profits was an equitable remedy and retains that characteristic. A defendant is made to account for, and is then stripped of, profits which it has dishonestly made by the infringement and which it would be unconscionable for it or him to retain. Its purpose is not to punish but to prevent unjust enrichment. Damages is a purely common law remedy: Dart Industries Inc v Décor Corporation Pty Ltd (1993) 179 CLR 101 per Mason CJ, Deane, Dawson and Toohey JJ, at 110-111, see also Colbeam Palmer Ltd v Stock Affiliates Pty Ltd (1968) 122 CLR 25 per Windeyer J at 32.

The evidence does not justify a finding that loss to the plaintiff or enrichment of the defendant probably occurred. They conduct their businesses in separate States and it cannot be assumed that customers of the defendant believed they were dealing with the plaintiff. Consideration of whether this element has been proved should be considered after the case on damages or unjust enrichment has been advanced.
Fair Trading Act
The plaintiff’s claim is based upon alleged contravention of s 56 and s 58(c) and (d) of the Fair Trading Act. In the statement of claim the plaintiff alleges that the conduct of the defendant in the use of its publications and signs which have earlier been mentioned contravened s 56 and s 58(c) and (d), however it is clear that the plaintiff’s case under this Act is based upon contravention of s 56 and s 58(f) which provide:
“56(1)     A person must not, in trade or commerce, engage in conduct that is misleading or deceptive or is likely to mislead or deceive.
(2)    Nothing in the succeeding provisions of this Division limits by implication the generality of subsection (1).
58A person must not, in trade or commerce, in connection with the supply or possible supply of goods or services or in connection with the promotion by any means of the supply or use of goods or services-
……..
(f)     represent that the person has a sponsorship, approval or affiliation that the person does not have;
…….”
In the Statement of Claim and in submissions the plaintiff asserted that the defendant represented, in connection with the manufacture, promotion, offering for supply, sale, export, display and supply of opals and opal jewellery that the defendant’s business and his goods have the sponsorship and approval of, and an affiliation with, the plaintiff when they do not have such sponsorship approval or affiliation.
S 56, apart from relating to a person and not a corporation is in the same terms as s 52 of the Trade Practices Act. S 58(f), apart from referring to a person and not a corporation, is in similar terms to s 53(c) of the Trade Practices Act which provides:
“53A corporation shall not, in trade or commerce, in connexion with the supply or possible supply of goods or services or in connexion with the promotion by any means of the supply or use of goods or services:
……
(c) represent that goods or services have sponsorship, approval, performance characteristics, accessories, uses or benefits they do not have; ….”
I have proceeded on the basis that the plaintiff’s claim is based upon s 58(f).
In R & C Products Pty Limited trading as Samuel Taylor v SC Johnson & Sons Pty Limited (1993) 42 FCR 188 Davies J considered s 52 of the Trade Practices Act and the tort of passing off. He said, at 192:
“As neither s 52 nor the common law tort of passing off require the respondent to have been fraudulent, malicious or negligent and as under each it is sufficient that there be a misrepresentation which was calculated or likely to mislead or deceive the purchasing public, it is unlikely that in a case such as the present the two bases of liability would have a significantly different application. In the application of s 52, authorities which have considered the common law tort provide guidance by analogy as to the type of conduct which would be likely to mislead or deceive the public.”
In Equity Access Pty Ltd v Westpac Banking Corporation & Anor (1989) 16 IPR 431, Hill J considered that the provisions of the Trade Practices Act, s 52 and s 53(c), relevant for present purposes along with the sections providing for remedies for breach of these sections, overlap the area of operation of the tort of passing off. He accepted the five elements in Erven Warnink BV. He also stated the following propositions with respect to s 52, at 440-441:
“1For the conduct to be misleading or deceptive, the conduct must convey in all of the circumstances of the case a misrepresentation. In the present case the misrepresentation on the part of the respondents is said to be that the financial product advertised and marketed by each of them is the product of the applicant or that there is some business relationship between the applicant and each of the respondents or that the applicant has endorsed the respective produce of the respondents.
2There will, however be no contravention of s 52(1) of the Act unless error or misconception results from the conduct of the corporation and not from other circumstances for which the corporation is not responsible.
3Conduct will be likely to mislead or deceive if there is a ‘real or not remote chance or possibility’ of misleading or deception regardless of whether it is less or more than 50 per cent. The question of whether conduct is misleading or deceptive or likely to mislead or decisive is an objective question which the court must determine for itself . Hence evidence that persons in the relevant class have been misled will, although admissible, not be determinative. In some cases however such evidence will be very persuasive.
4Conduct of a corporation causing mere confusion or uncertainty in the minds of the public in the sense that they may be caused to wonder whether two products may have come from the same source is not necessarily coextensive with misleading or deceptive conduct. Since actual deception need not be shown the court must consider whether a reasonably significant number of potential purchasers would be likely to be misled or deceived. The test in passing off cases is usually expressed as being whether a ‘substantial number of persons likely to become purchasers … are liable to be deceived by the defendant’s use of the name. On the other hand it is not necessary to show that all, or substantially all, persons in the market associate the name with the plaintiff’s goods, if this can be shown of a substantial proportion of persons who are probably purchasers of the goods of the kind in question’.
5In a case such as the present the applicant must establish that it has acquired the relevant reputation in the name, that is to say that the name had become distinctive of the applicant’s business in a particular country or geographical area. However, at least in some circumstances, very slight activities may be found to be sufficient to establish that a name has become distinctive of a person’s business in a particular country.
6Section 52 is not confined to conduct which is intended to mislead or deceive and a corporation which acts honestly and reasonably may none the less engage in conduct that is likely to mislead or deceive.” (citations omitted)
Hill J went on to say, at 441:
“In Taco Co of Australia Inc v Taco Bell Pty Ltd (1982) 42 ALR 177 at 202-3, Deane and Fitzgerald JJ set out four guidelines for the application of s 52 to cases such as the present where the misrepresentation is not express. Their Honours said:
‘First, it is necessary to identify the relevant section (or sections) of the public (which may be the public at large) by reference to whom the question of whether conduct is, or is likely to be, misleading or deceptive falls to be tested …
Second, once the relevant section of the public is established, the matter is to be considered by reference to all who come within it, “including the astute and the gullible, the intelligent and the not so intelligent, the well educated as well as the poorly educated, men and women of various ages pursuing a variety of vocations ….”
Thirdly, evidence that some person has in fact formed an erroneous conclusion is admissible and may be persuasive but is not essential. Such evidence does not itself conclusively establish that conduct is misleading or deceptive or likely to mislead or deceive. The court must determine that question for itself. The test is objective.
Finally, it is necessary to enquire why proven misconception has arisen: Hornsby Building Information Centre Pty Ltd v Sydney Building Information Centre (1978) 18 ALR 639 at 647; 140 CLR 216 at 228. The fundamental importance of this principle is that it is only by this investigation that the evidence of those who are shown to have been led into error can be evaluated and it can be determined whether they are confused because of misleading or deceptive conduct on the part of the respondent.’”
I have approached the claim based upon the Fair Trading Act by applying those principles. The claim is that the defendant has contravened these sections by using the name “The Australian Opal Collection” and the first elevated sign and the second elevated sign at the King William Street premises (para 10.2 of Statement of Claim). I accept that such conduct was misleading or deceptive and was a misrepresentation which was “calculated or likely to mislead or deceive the purchasing public”: R & C Products at 192. The defendant is responsible for the misrepresentation. There was a real likelihood that the conduct would mislead. My conclusions on this matter is reinforced by the evidence of the witnesses when I have mentioned who were misled. I accept that it was likely that a significant number of potential purchasers would be likely to be misled or deceived as is shown by the evidence of these witnesses which supports my own conclusion. Earlier I mentioned the evidence of the substantial promotion of the plaintiff’s trade mark and the name “The National Opal Collection”, including to overseas visitors and I accept that many of them attending Adelaide who had encountered aspects of that promotion would be likely to be misled or deceived by the two signs and the name “The Australian Opal Collection” into believing that the defendant’s business was the business of the plaintiff. The extent of the promotion by the plaintiff of the name and the mark was such that they had become distinctive of the applicant’s business The National Opal Collection in this country. The relevant section of the public is not confined to tourists but includes residents of this country aware of the plaintiff’s mark and name through extensive promotion.
I accept that the “proven misconception” has arisen because of the similarity between the name of the business of the plaintiff and the name used by the defendant and between the plaintiff’s mark and the two elevated signs.
The plaintiff has proved this cause of action and upon proof of loss or damage is entitled to relief.
Conclusions
I have found that the defendant infringed the plaintiff’s trade mark, infringed its copyright in the various publications and the first elevated sign, passed off his business as and for the business of the plaintiff and engaged in conduct that is misleading and deceptive or is likely to mislead and deceive. The plaintiff is entitled to the following declarations:
1that the conduct of the defendant in using the first elevated sign and the second elevated sign infringed the plaintiff’s trade mark;
2that the defendant infringed the plaintiff’s copyright in the opalized border on the front corner of Mr Andrew Cody’s book and the photograph which I have mentioned by the production and use of the publications and signs set out in paragraphs 73, 78, 79, 85, 87, 89, 92 and 95 of these reasons.
The plaintiff is entitled to injunctions to restrain the use of the publications set out in paragraphs 73, 78 and 79 hereof and the first elevated sign, the second elevated sign and the opalized adhesive strip.
The plaintiff is not entitled to damages or an account of profits for infringement of the trade mark or copyright unless and until losses sustained by it or enrichment of the defendant in consequence of such infringements have been proved.
The tort in passing off has been established against the defendant except for the component of loss and damage. Injunctive relief for contravention of the Fair Trading Act is not required to protect the plaintiff because of the injunctive relief to be granted for infringement of the trade mark and copyright as indicated. Damages for contravention of the Fair Trading Act have not yet been proved.
Further hearing of the action is to be referred to a Master to determine if loss and damage to the plaintiff is established or an account of profits should be taken.
I shall hear the parties as to the terms of the judgment and any consequential orders which should now be made.