Coonan & Denlay Pty Ltd v Superstar Australia Pty Ltd
[1981] FCA 145
•04 SEPTEMBER 1981
Re: COONAN & DENLAY PTY. LIMITED and ANTHONY EUNAN HENSON
And: SUPERSTAR AUSTRALIA PTY. LIMITED (1981) 54 FLR 94
No. G112 of 1981
Trade Practices - Copyright an Designs - High Court and Federal Judiciary
COURT
IN THE FEDERAL COURT OF AUSTRALIA
NEW SOUTH WALES DISTRICT REGISTRY
GENERAL DIVISION
Bowen C.J.(1)
CATCHWORDS
Trade Practices - Conduct misleading or deceptive or likely to mislead or deceive - Cricketers wearing applicants' cricket helmet depicted on boxes containing respondent's helmet - Prima facie breach s.52 Trade Practices Act.
Associated jurisdiction - Matter involving Trade Practices Act associated with alleged breach of copyright in registered design - s.32 Federal Court of Australia Act.
Registered designs - First named applicant exclusive licensee, second named applicant registered owner of registered design in respect of cricket helmet - Respondent threatening to market similar helmet - Prima facie case of infringement of s.30(1)(c) Designs Act.
Trade Practices Act 1974, s.52
Federal Court of Australia Act 1976, s.32
Designs Act 1906, s.30(1)(c)
Copyright and Designs - Registered designs - Respondent intended marketing similar product - Whether prima facie case of infringement of copyright - Interim injunction sought - Designs Act 1906 (Cth), s. 30 (1) (c). High Court and Federal Judiciary - Federal Court - Associated matters - Copyright - Infringement of copyright associated with breach of Trade Practices Act - Whether court has jurisdiction - Federal Court of Australia Act 1976 (Cth), s. 32 - Designs Act 1906 (Cth), s. 30 (1) (c). Trade Practices - Misleading or deceptive conduct - Whether prima facie breach - Trade Practices Act 1974 (Cth), s. 52.
HEADNOTE
The first applicant was the exclusive licensee and the second applicant the registered proprietor of a registered design of a cricket helmet. They instituted proceedings against the respondent seeking injunctions and other relief. At a preliminary hearing for directions and interlocutory relief the applicants alleged that the respondent was selling cricket helmets in packaging which misled the public in contravention of s. 52 of the Trade Practices Act 1974 and that the helmets infringed the applicants' registered design.
Held: Interim injunctions should be granted because: (1) The applicants have established a prima facie case of contravention of s. 52 of the Trade Practices Act 1974.
(2) The claim in respect of the infringement of copyright in the registered design of the helmet is an associated matter within s. 32 of the Federal Court of Australia Act 1976 and the court has jurisdiction in respect of it.
Philip Morris Incorporated v. Adam P. Brown Male Fashions Pty. Ltd. (1981), 55 ALJR 120, referred to.
(3) The applicants have established a prima facie case of infringement by the respondent of the copyright in their registered design.
J. Harper & Co. Ltd. v. Wright & Butler Lamp Manufacturing Co. Ltd., (1896) 1 Ch 142, applied.
(4) In the circumstances of the instant case and since the court is in a position to give an early hearing the balance of convenience is in favour of granting interim injunctions under the Trade Practices Act 1974 and to restrain infringement of copyright in the registered design.
E.A.R. Corporation v. Protector Safety Products (U.K.) Ltd., (1980) FSR 574, referred to.
HEARING
Sydney, 1981, September 1, 4. #DATE 4:9:1981
APPLICATION.
The applicants sought, inter alia, interlocutory relief against the respondent in the Federal Court of Australia.
W. M. Gummow, for the applicants.
O. B. Patterson, for the respondent.
Cur. adv. vult.
Solicitors for the applicants: Allen Allen & Hemsley.
Solicitors for the respondent: Gregory & Co.
E. F. FROHLICH
ORDER
Upon the applicants giving to the Court the usual undertaking as to damages, pending the determination of these proceedings or further order the respondent by itself, its officers servants and agents, be restrained from:
Selling offering or keeping for sale, supplying or advertising any cricket helmet packaged in or sold offered or supplied or advertised in conjunction with any box the same or substantially the same as the box which is Exhibit H; and
Selling offering or keeping for sale supplying or advertising:
(a) any cricket helmet in the form of the helmet Exhibit J; or
(b) any cricket helmet to which has been applied the design registered number 74666 or any colourable imitation thereof.
THE COURT FURTHER ORDERS AND DIRECTS THAT:
(i) The applicants do file and serve any further affidavits upon which they rely within 21 days from and including 1 September 1981;
(ii) The respondents do file and serve any affidavits upon which they rely within 21 days thereafter;
(iii) The applicants do file and serve any affidavits upon which they rely in reply within 10 days thereafter;
(iv) The evidence at the hearing be on affidavit with cross-examination;
(v) The parties give discovery with verification on or before 14 days after the completion of the filing of affidavit evidence and that inspection take place within 7 days thereafter;
(vi) Any party delivering interrogatories do so within 14 days of the time limited for inspection and interrogatories be answered within 10 days of delivery of the same.
This directions hearing stood over to Tuesday, 8 December 1981.
Any party be at liberty to apply on 48 hours notice.
The respondent pay to the applicants their costs of the application for interim injunctions.
JUDGE1
This is a dispute about that recent addition to cricketers' equipment, the cricket helmet. Coonan & Denlay Pty. Limited and Anthony Eunan Henson, applicants, have filed an application seeking injunctions and other orders against Superstar Australia Pty. Limited, respondent, in relation to the sale of cricket helmets.
The matter comes before me for directions and for interlocutory relief. Stating the matter in a summary way, the applicants at this stage seek interlocutory orders restraining the respondent from selling any cricket helmet in packaging which is claimed to be misleading to the public; from selling any cricket helmet in the form presently sold by the respondent which it is claimed infringes registered design no.74666 of which the first applicant is the exclusive licensee and the second applicant the registered proprietor; and, from selling any cricket helmet to which has been applied the design disclosed in registered design no.74666.
The first claim is for an interim injunction under s.80 of the Trade Practices Act 1974 to restrain conduct which is said to be in contravention of s.52 of that Act. The second and third claims are for interim injunctions based on alleged breaches or threatened breaches of the copyright in the registered design no.74666. Claims which are based on infringement of copyright in a registered design should normally be litigated in the appropriate Supreme Court exercising federal jurisdiction with an appeal to this Court (Designs Act 1906, ss.40A and 40B, cf. s.39). However, where this Court has jurisdiction in relation to a matter under the Trade Practices Act, it has conferred upon it by s.32 of the Federal Court of Australia Act 1976 jurisdiction in respect of matters not otherwise within its jurisdiction that are associated with the matter in which its jurisdiction is invoked. The associated matters covered by s.32 are matters of federal jurisdiction not matters of State or non-federal jurisdiction (Phillip Morris Inc. and Phillip Morris Limited v. Adam P. Brown Fashions Pty. Limited (1981) 55 A.L.J.R. 120).
Dealing with the claim under the Trade Practices Act it appears to me that the applicants have established a prima facie case of contravention of s.52 in the sense that they have at this stage shown a probability of success at the hearing (Beecham Group Limited v. Bristol Laboratories Pty. Limited (1968) 118 C.L.R. 618).
The evidence shows that the respondent is selling a cricket helmet in a box which has on its top:
"DUNCAN FEARNLEY"
(A logo of stumps and bails)
"Test Match
CRICKET HELMET
with VISOR"
On the left-hand side appears a coloured photograph of a cricketer in action wearing a blue helmet with ear protectors. Alongside this are the words "Graham Gooch Essex and England". Above the photo appear the words "Endorsed by International SUPERSTARS" and further to the right the logo and the words "Perfection in Cricket Equipment". On the right-hand side appears a coloured photograph of a cricketer in action wearing a maroon helmet with visor. Alongside this are the words "Kepler Wessels Qld. Australia" and above it are the words "Endorsed by International SUPERSTARS". On the back of the box is other printed material including the words "National Distributor: Superstar Australia, Pty. Ltd.," and an address and telephone number.
The evidence of Mr. Henson on affidavit and in the witness box was that the helmet worn by Mr. Gooch in the photograph was one manufactured by the first applicant for Mr. Gooch in the 1978/79 cricket season when the English cricket team was touring Australia. The ear guards were not in accordance with the registered design but were manufactured by the first applicant at the request of Mr. Gooch. He also gave evidence that the helmet worn by Mr. Wessels in the photograph was one of the helmets manufactured by the first applicant as exclusive supplier to the Queensland cricket team.
For the applicants it was argued first, that the words "test match" coupled with the other material conveyed a representation that the helmet within the box which was being sold was of a manufacture worn by players in test matches so that a purchaser would be attired with the same equipment as a test player and that it was not true that the respondent's helmet had ever been worn in a test match by anyone. Secondly, it was argued that a person viewing the box would be led to the belief that the helmet was the same as that worn by the two famous cricketers shown in action in the photographs whereas they were wearing the applicants' helmet and not the respondent's helmet. There was here a misrepresentation it was said as to the connection between the photos and the contents and between the person depicted as an endorser of the product and the contents. Thirdly, it was argued that there having been a great number of the applicants' helmets sold and promoted the applicants' helmet was well-known so that some people would be misled into buying the respondent's helmet thinking they were getting the applicants' helmet.
For the respondent it was argued that in selling the helmet in that box the respondent was simply selling an article under its own name and that no-one would be misled. It was said that Messrs. Gooch and Wessels were contracted to Duncan Fearnley to endorse his products and that it had not been proved that they were in fact depicted as wearing the applicants' helmet. No evidence was offered by the respondent.
On this aspect of the matter I am of opinion that the applicants have established a prima facie case of contravention of s.52. In view of the fact that this matter will have to be fully litigated at the hearing I do not propose to say more at this stage.
Turning to the question of infringement of the registered design it was argued for the respondent that I had no jurisdiction to entertain the claim on this basis. It was said that the claim under the Trade Practices Act was only made by way of pretence and was merely colourable. On the evidence at this stage I am of opinion that the claim under the Trade Practices Act has substance and is not colourable. This being so, I may add that I am of the view that the claim in respect of the infringement of copyright in the registered design of the helmet is an associated matter within s.32 of the Federal Court of Australia Act and that I have jurisdiction in respect of it.
Counsel for the respondent argued that his client's helmet did not infringe the registered design. He drew attention to differences in detail between the respondent's helmet, an example of which was in evidence, and the registered design itself. He also compared the respondent's helmet with an example of the current helmet sold by the applicants, which was an exhibit. He submitted further that the persons purchasing these articles would be knowledgable in matters relating to cricket and that the differences between the helmets would be significant to them.
In considering the question of infringement I apply the test laid down by Lord Herschell in J. Harper & Co. Limited v. Wright & Butler Lamp Manufacturing Co. Limited (1895) 12 R.P.C. 483 at p.488. The applicants' design in part involved a modification of a riding cap. The respondent's helmet was somewhat closer to the form of a riding cap than is the registered design. Nevertheless, comparing the respondent's helmet with the registered design including the visor, I have come to the conclusion that notwithstanding there are some minor variations the applicants have established a prima facie case of infringement of the copyright in the registered design.
The next question which arises is whether having regard to the balance of convenience I should grant interim injunctions. Counsel for the respondents have submitted that damages would be an adequate remedy and that I should not intervene by injunction at this stage. Slightly different considerations apply to the claim for an injunction based on s.52 of the Trade Practices Act from those which apply to the claim based on registered design. Section 52 is a section designed to protect the public. Holding as I do the view that a prima facie case has been established that the box would be likely to mislead, I consider that there are substantial reasons why I should restrain its use pending the hearing. Such an injunction would not interfere with any large established business of the respondent. So far as the evidence disclosed, the respondent had imported from Taiwan only a few samples of its helmet. The invoices dated 30 July 1981 with corresponding Qantas Airways Limited waybills were in evidence showing importation of ten Duncan Fearnley cricket helmets complete with face visor, ten Superstar cricket helmets complete with face visor (ABS helmet) and ten replacement protective visors. There appears to have been one advertisement placed by the respondent in "Australian Sports Goods and Toy Retailer" for July 1981 advertising Duncan Fearnley cricket equipment including the helmet which is depicted and described as "Duncan Fearnley test match helmet". The evidence and what was said from the bar table suggest that the respondent was presently testing the market and that it was hoped before the 1981/82 cricket season started to begin importing in quantity. I would have felt some reluctance to grant an interim injunction extending over the whole of that cricket season if a hearing of the case could not have been arranged until next year. However, as the parties were informed, the Court is in a position to give an early hearing this year. The parties themselves require time to file their affidavits and have discovery, inspection and interrogatories. Short minutes of directions were handed up to me which in the result were agreed to by the parties providing for the case to be heard on affidavit evidence and providing for a timetable. It was thought at the time that this timetable would result in the case being ready to be heard in the latter part of this year, although I have found that to achieve this result it would be necessary to shorten certain of the times slightly. The Court would then be able to give the parties a hearing.
In the circumstances I consider that the balance of convenience is in favour of granting the injunction under the Trade Practices Act until the hearing or further order.
The injunctions sought to restrain infringement of copyright in the registered design are essentially a matter between the parties. As I have noted, Counsel for the respondent submits that damages would be an adequate remedy. On this aspect Counsel for the applicants referred me to the judgment of Graham J. in E.A.R. Corporation v. Protector Safety Products (U.K.) Limited (1980) 6 F.S.R. 574. He pointed out that there was no challenge to the validity of the registered design and argued that the applicants were entitled to build up their trade under the protection of the monopoly conferred by the Designs Act without having that broken down before the hearing. He offered the usual undertaking as to damages.
The applicants proved substantial sales:
SALES
"1978 $ 10,000.00
1979 $270,000.00
1980 $240,000.00
1981 $102,330.00 (represents sales and
orders to date)
TOTAL $622,330.00"
In addition there was advertising by the applicants in evidence in the "Official Test Cricket Book The Summer of 1980-81" and in the "World Series Cup Official One Day Cricket Book The Summer of 1980-81".
In the circumstances and having regard to the small initial business of the respondent in relation to the helmets I am of opinion that the balance of convenience is in favour of granting the injunctions to maintain the present position, rather than to refuse the injunctions and to allow the position to alter in the meantime with the possible importation and sale of substantial quantities of the respondents' helmets.
In the result I propose to grant interim injunctions. I shall mention the form of those in a moment. First I should say that I propose also to give directions as to affidavits, discovery, inspection and interrogatories and to stand over the directions hearing to a later date with liberty to apply.
The orders I make are:
Upon the applicants giving to the Court the usual undertaking as to damages, order that pending the determination of these proceedings or further order the respondent by itself, its officers servants and agents, be restrained from:
1. Selling offering or keeping for sale, supplying or advertising any cricket helmet packaged in or sold offered or supplied or advertised in conjunction with any box the same or substantially the same as the box which is Exhibit H; and
2. Selling offering or keeping for sale supplying or advertising:
(a) any cricket helmet in the form of the helmet Exhibit J; or
(b) any cricket helmet to which has been applied the design registered number 74666 or any colourable imitation thereof.
I further order and direct that:
3. (i) The applicants do file and serve any further affidavits upon which they rely within 21 days from and including 1 September 1981;
(ii) The respondents do file and serve any affidavits upon which they rely within 21 days thereafter;
(iii) The applicants do file and serve any affidavits upon which they rely in reply within 10 days thereafter;
(iv) The evidence at the hearing be on affidavit with cross-examination;
(v) The parties give discovery with verification on or before 14 days after the completion of the filing of affidavit evidence and that inspection take place within 7 days thereafter;
(vi) Any party delivering interrogatories do so within 14 days of the time limited for inspection and interrogatories be answered within 10 days of delivery of the same.
4. This directions hearing stood over to Tuesday, 8 December 1981.
5. Any party be at liberty to apply on 48 hours notice.
6. The respondent pay to the applicants their costs of the application for interim injunctions.
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