Deckers Outdoor Corporation Inc. v Farley - [2008] FCA 1514

FEDERAL COURT OF AUSTRALIA
Deckers Outdoor Corporation Inc. v Farley [2008] FCA 1514
PRACTICE AND PROCEDURE – application for default judgment
Federal Court Rules 1979 (Cth) O 35A, r 3(2)
Australian Competition and Consumer Commission v 1Cellnet LLC [2005] FCA 856 cited
DECKERS OUTDOOR CORPORATION INC. v LEAH JANE FARLEY, DUSIA PTY LTD ACN 119 500 186, LEONID MYKHALOVSKYI, HEPBOURNE PTY LTD ACN 080 453 247, VLADIMIR VAYSMAN, JOSEF VAYSMAN, POLINA VAYSMAN, MILLHOUSE PTY LTD ACN 111 765 505, DIANNE SOMMER, SANDY HAZENDONK, HGU PTY LTD ACN 121 922 754, FEDIA PTY LTD ACN 119 500 444, TASKINC PTY LTD ACN 121 919 926, OTK INTERNATIONAL PTY LTD ACN 119 498 001, GIHAN EZZAT, JOANNE STRICKLAND, VERNON PTY LTD ACN 123 047 138, RASTOV PTY LTD ACN 119 498 547, VICTORIA VAYSMAN, OLIVER DOEDERLEIN, MARGARIT PEDROTTI and SAMBA ENTERPRISES PTY LTD ACN 111 968 935
VID 1022 OF 2007
TRACEY J
10 OCTOBER 2008
MELBOURNE

IN THE FEDERAL COURT OF AUSTRALIA

VICTORIA DISTRICT REGISTRY

VID 1022 OF 2007

BETWEEN:

DECKERS OUTDOOR CORPORATION INC.
Applicant

AND:

LEAH JANE FARLEY
First Respondent

DUSIA PTY LTD ACN 119 500 186
Second Respondent

LEONID MYKHALOVSKYI
Third Respondent

HEPBOURNE PTY LTD ACN 080 453 247
Fourth Respondent

VLADIMIR VAYSMAN
Fifth Respondent

JOSEF VAYSMAN
Sixth Respondent

POLINA VAYSMAN
Seventh Respondent

MILLHOUSE PTY LTD ACN 111 765 505
Eighth Respondent

DIANNE SOMMER
Ninth Respondent

SANDY HAZENDONK
Tenth Respondent

HGU PTY LTD ACN 121 922 754
Eleventh Respondent

FEDIA PTY LTD ACN 119 500 444
Twelfth Respondent

TASKINC PTY LTD ACN 121 919 926
Thirteenth Respondent

OTK INTERNATIONAL PTY LTD ACN 119 498 001
Fourteenth Respondent

GIHAN EZZAT
Fifteenth Respondent

JOANNE STRICKLAND
Sixteenth Respondent

VERNON PTY LTD ACN 123 047 138
Seventeenth Respondent

RASTOV PTY LTD ACN 119 498 547
Eighteenth Respondent

VICTORIA VAYSMAN
Nineteenth Respondent

OLIVER DOEDERLEIN
Twentieth Respondent

MARGARIT PEDROTTI
Twenty-First Respondent

SAMBA ENTERPRISES PTY LTD ACN 111 968 935
Twenty-Second Respondent

JUDGE:

TRACEY J

DATE OF ORDER:

10 OCTOBER 2008

WHERE MADE:

MELBOURNE

THE COURT ORDERS THAT:
1.The amount of $150,000, deposited by the Applicant in the trust account of Middletons, in accordance with the order of Ryan J on 3 January 2008 and by way of security for the undertaking given to the Court on that day, be released to the Applicant.
2.Pursuant to Order 35A, rule 3(2) of the Federal Court Rules 1979 (Cth):
(a)it is declared that the Second, Eighth, Eleventh, Twelfth, Thirteenth, Fourteenth, Seventeenth and Eighteenth Respondents have:
(i)infringed or been joint tortfeasors in the infringement of registered trade mark number 785466 (the Trade Mark) in breach of section 120(1) of the Trade Marks Act 1995 (Cth);
(ii)infringed or authorised the infringement, in breach of sections 36, 37 and/or 38 of the Copyright Act 1968 (Cth), of the copyright in the works set out in exhibits CR-1, 2 and 3 to the affidavit of Constance Rishwain dated 6 May 2008, RAB-1 and RAB-2 to the affidavit of Robert Bergstrom dated 6 May 2008 and CT-1 to the affidavit of…

Grounds of appeal

[14] The appellant contends that the primary judge erred in finding that the respondent had discharged the onus of establishing the matters required under the relevant provision.

[15] It was submitted that his Honour failed to give adequate weight to the evidence of the second witness, and that the findings of fact were not reasonably open on the material before the Court.

[16] The respondent, for its part, submits that no error is disclosed, and that the conclusions reached were well within the range of outcomes available to the primary judge.

Consideration

[17] It is convenient to deal first with the question of construction, as the resolution of that issue informs the remaining grounds advanced by the appellant.

[18] For the reasons that follow, we are of the view that the appeal should be allowed in part and the matter remitted for further determination.

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Details

Case: [2008] FCA 1514
Decision Date: 10 October 2008

CaseChat Overview and Summary

Deckers Outdoor Corporation Inc. sought relief against a number of respondents for the alleged infringement of intellectual property rights. The Federal Court of Australia was tasked with deciding whether the respondents had infringed the applicant's trade mark and copyright, engaged in misleading and deceptive conduct, and committed the tort of passing off. The court had to assess the evidence and arguments presented by both parties to determine whether the respondents had indeed engaged in the activities alleged by the applicant.

The court considered the evidence and arguments from both sides and concluded that the respondents had indeed infringed the applicant's intellectual property rights. The court found that the respondents had used the applicant's trade mark and copyright without permission, engaged in misleading and deceptive conduct, and committed the tort of passing off. The court also found that the respondents had manufactured and sold products that were confusingly similar to the applicant's products.

The court granted the relief sought by the applicant. The court ordered the respondents to cease manufacturing, promoting, advertising, distributing, offering for sale, selling or exhibiting in public the products that infringed the applicant's intellectual property rights. The court also ordered the respondents to deliver up all the products, advertising, promotional, point of sale material and/or signage which featured the trade marks and/or the copyright works in their possession, custody or control. The court further ordered the respondents to pay the applicant's costs of and incidental to the Notice of Motion and the proceeding including reserved costs.

The court's decision provides a clear message to those who seek to infringe the intellectual property rights of others. The court's order to cease the manufacture and sale of the infringing products, to deliver up all the infringing products, advertising, promotional, point of sale material and/or signage and to pay the applicant's costs sends a strong message that intellectual property rights are to be respected and protected. The decision also provides guidance to the parties on the relief that may be available in cases of intellectual property infringement.

Orders

Orders of the court

1. The amount of $150,000, deposited by the Applicant in the trust account of Middletons, in accordance with the order of Ryan J on 3 January 2008 and by way of security for the undertaking given to the Court on that day, be released to the Applicant.

2. Pursuant to Order 35A, rule 3(2) of the Federal Court Rules 1979 (Cth):

(a) it is declared that the Second, Eighth, Eleventh, Twelfth, Thirteenth, Fourteenth, Seventeenth and Eighteenth Respondents have:

(i) infringed or been joint tortfeasors in the infringement of registered trade mark number 785466 (the Trade Mark) in breach of section 120(1) of the Trade Marks Act 1995 (Cth);

(ii) infringed or authorised the infringement, in breach of sections 36, 37 and/or 38 of the Copyright Act 1968 (Cth), of the copyright in the works set out in exhibits CR-1, 2 and 3 to the affidavit of Constance Rishwain dated 6 May 2008, RAB-1 and RAB-2 to the affidavit of Robert Bergstrom dated 6 May 2008 and CT-1 to the affidavit of Cristina Trayfors dated 6 May 2008 (the Copyright Works);

(iii) engaged in misleading and deceptive conduct in breach of sections 9 and/or 12 of the Fair Trading Act 1999 (Vic) and sections 52 and 53 of the Trade Practices Act 1974 (Cth); and

(iv) committed the tort of passing off;

(b) it is declared that the Third Respondent has:

(i) infringed or been a joint tortfeasor in the infringement of the Trade Mark in breach of section 120(1) of the Trade Marks Act 1995 (Cth);

(ii) infringed or authorised the infringement of the Copyright Works in breach of sections 36, 37 and/or 38 of the Copyright Act 1968 (Cth);

(iii) engaged in misleading and deceptive conduct in breach of sections 9 and/or 12 of the Fair Trading Act 1999 (Vic) and section 75B of the Trade Practices Act 1974 (Cth); and

(iv) committed the tort of passing off;

(c) the Second, Third, Eighth, Eleventh, Twelfth, Thirteenth, Fourteenth, Seventeenth, and Eighteenth Respondents and each of them, whether by themselves, their directors, servants, agents, employees or howsoever be restrained from:

(i) importing, exporting, manufacturing, promoting, advertising, distributing, offering for sale, selling or exhibiting in public, the Respondents' Products (as defined in paragraph 25 of the Further Amended Statement of Claim);

(ii) disposing or dealing with the Respondents’ Products in any other way than in accordance with order 2(d) below;

(iii) authorising, procuring or inducing any person to do any act which would be an infringement of the injunction referred to in paragraph 2(c)(i) above;

(iv) representing that the Respondents' Products are imported, exported, manufactured, advertised, promoted, offered for sale and/or sold with the sponsorship or approval of the Applicant;

(v) representing that the Respondents' Products are the Ugg Products (as defined in paragraph 20 of the Further Amended Statement of Claim);

(vi) representing the Respondents' Products emanate from the same trade source as the Ugg Products;

(vii) representing that the Respondents' Products are made by the Applicant;

(viii) representing that the businesses of the Second, Third, Eighth, Eleventh, Twelfth, Thirteenth, Fourteenth, Seventeenth and Eighteenth Respondents are licensed, authorised, sponsored, approved or endorsed by the Applicant;

(d) the Second, Third, Eighth, Eleventh, Twelfth, Thirteenth, Fourteenth, Seventeenth and Eighteenth Respondents and each of them, whether by themselves, their directors, servants, agents, employees or howsoever, deliver up to the Applicant's solicitors:

(i) all the Respondents' Products in their possession, custody or control;

(ii) all advertising, promotional, point of sale material and/or signage which features the Trade Marks and/or the Copyright Works in their possession, custody or control; and

(iii) all materials which are used by the Second, Third, Eighth, Eleventh, Twelfth, Thirteenth, Fourteenth, Seventeenth and Eighteenth Respondents in the manufacture of the Respondents' Products.

3. The Second, Third, Eighth, Eleventh, Twelfth, Thirteenth, Fourteenth, Seventeenth, and Eighteenth Respondents pay the Applicant's costs of and incidental to the Notice of Motion dated 6 August 2008 as amended by order of the Court on 1 October 2008.

4. The Second, Third, Eighth, Eleventh, Twelfth, Thirteenth, Fourteenth, Seventeenth and Eighteenth Respondents pay the Applicant’s costs of the proceeding including reserved costs.

Background

Background to the litigation

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Evidence

Evidence Before The Court

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Decision

Reasons for decision

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Ratio Decidendi

Legal Principle Established

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IN THE FEDERAL COURT OF AUSTRALIA
VICTORIA DISTRICT REGISTRY	VID 1022 OF 2007

JUDGE:	TRACEY J
DATE OF ORDER:	10 OCTOBER 2008
WHERE MADE:	MELBOURNE