Dolby Laboratories Licensing Corporation v Kamil

[2013] FCCA 1326

FEDERAL CIRCUIT COURT OF AUSTRALIA

DOLBY LABORATORIES LICENSING CORPORATION & ANOR v KAMIL [2013] FCCA 1326

Catchwords:
TRADEMARKS – Application for interlocutory orders restraining the release of goods from customs control.

Legislation:

Customs Act 1901 (Cth), s.68
Federal Circuit Court of Australia Act 1999 (Cth), s.15
Trade Marks Act 2005 (Cth), ss.6, 126, 131, 132, 133, 134, 136, 136C, 136D, 137, 191A

Australian Broadcasting Corporation v O’Neill (2006) 227 CLR 57

First Applicant: Dolby Laboratories Licensing Corporation

Second Applicant: DOLBY SINGAPORE PTE LTD

Respondent: Najeeb Kamil

File Number: SYG 2037 of 2013

Judgment of: Judge Driver

Hearing date: 11 September 2013

Delivered at: Sydney

Delivered on: 11 September 2013

REPRESENTATION

Counsel for the Applicants: Mr H P T Bevan

Solicitors for the Applicants: Baker & McKenzie

Ms T Kamil appeared on behalf of the Respondent

INTERLOCUTORY ORDERS

1. Until further or other order of the Court, the Chief Executive Officer of the Australian Customs Service be restrained from releasing the consignment consisting of six thousand six hundred (6,600) DVDs described as “Six Thousand six hundred (6600) x DVDs bearing Dolby Digital trademarks, a sign that is substantially identical or deceptively similar to a trade mark notified by Dolby Singapore Pte Ltd”, seized pursuant to s.133 of the Trade Marks Act1995 (Cth) on 2 August 2013, which goods are referred to in the Notice of Seizure to Objector dated 2 August 2013 and given Customs Reference Number of File Number 2013/026069-01, DGMS Number V0124343 and QM Number 1656782.

2. Until further or other order of the Court, the respondent, by himself, his servants, his agents or otherwise, be restrained from collecting from the Australian Customs Service the consignment consisting of six thousand six hundred (6,600) DVDs described as “Six Thousand six hundred (6600) x DVDs bearing Dolby Digital trademarks, a sign that is substantially identical or deceptively similar to a trade mark notified by Dolby Singapore Pte Ltd”, seized pursuant to s.133 of the Trade Marks Act1995 (Cth) on 2 August 2013, which goods are referred to in the Notice of Seizure to Objector dated 2 August 2013 and given Customs Reference Number of File Number 2013/026069-01, DGMS Number V0124343 and QM Number 1656782.

3. Pending the determination of the proceeding or until further or other order of the Court, the respondent be restrained from:

   (a)manufacturing;

   (b)importing;

   (c)causing or procuring the manufacture or importation of;

   (d)selling or offering or exposing for sale;

   (e)advertising or promoting; or

   (f)otherwise providing;

   goods bearing:

   (i)one or more of the registered trade marks set out in Schedule A to these orders;

   (ii)any mark which is substantially identical with or deceptively similar to any one or more of the registered trade marks set out in Schedule A;

   without the prior written consent of the applicants.

4. The respondent is to file and serve on the applicants a response to the application within 14 days.

5. The proceeding be adjourned for further directions on 16 October 2013 at 9.30am.

6. Any Application in a Case seeking a transfer of the proceedings to Melbourne, together with a supporting affidavit, is to be filed and served by 9 October 2013.

7. Any Application in a Case, if filed pursuant to order 6, is to be listed for hearing at 9.30am on 16 October 2013.

8. Parties have liberty to apply for further orders or directions on three days’ notice.

9. Costs be reserved.

10. The Respondent have leave to attend the next directions hearing by telephone provided that he provide the Court with a telephone number on which he can be reached within 48 hours before the date of the next directions hearing.

FEDERAL CIRCUIT COURT
OF AUSTRALIA
AT Sydney

SYG 2037 of 2013

Dolby Laboratories Licensing Corporation

First Applicant

DOLBY SINGAPORE PTE LTD
Second Applicant

And

Najeeb Kamil

Respondent

REASONS FOR JUDGMENT

1. As part of their originating application, the applicants (Dolby) apply for interlocutory injunctions in aid of their claim for relief under the Trade Marks Act1995 (Cth) (Trade Marks Act) in respect of the respondent’s (Mr Kamil) infringement of Dolby’s registered trade marks.

2. The interlocutory injunctions sought fall into two categories.

3. The first category concerns prayers 1 and 2. The effect of these orders is to prevent the release from the Australian Customs Service (Customs) of 6,600 DVDs bearing trade marks that are substantially identical with or deceptively similar to Dolby’s registered marks. The DVDs were seized by Customs in accordance with the provisions of Part 13 of the Trade Marks Act. There is a serious question to be tried that Mr Kamil has infringed Dolby’s registered trade marks by importing the DVDs with those marks. These orders are necessary in order to preserve the subject matter of the proceeding because, without these orders, the DVDs will be released to Mr Kamil. Orders of this nature are contemplated by s.136D(4) of the Trade Marks Act.

4. The second category concerns prayer 3.  The effect of this order is to prevent Mr Kamil from infringing Dolby’s registered trade marks pending the final determination of the proceeding.  The size of the consignment indicates that this was a deliberate and significant commercial transaction.  Mr Kamil persisted in this course of conduct by pursuing the DVDs after notice of Dolby’s claims and refusing to consent to their forfeiture.  He has not offered any undertakings to refrain from such activities.

Evidence

1. Dolby relies on affidavits of Elisabeth Jane White sworn 29 August 2013 (White 1).  I declined to receive, for the purposes of today’s hearing, a further affidavit by Ms White sworn 11 September 2013 (which sought to introduce tendency evidence).

Principles – Interlocutory injunctions

1. This Court has jurisdiction with respect to matters under the s.191A of the Trade Marks Act.

2. The power to grant interlocutory injunctive relief in trade mark infringement cases is conferred by s.126 of the Trade Marks Act and s.15 of the Federal Circuit Court of Australia Act1999 (Cth).

3. The principles relevant to the grant of interlocutory injunctions are well-established.

4. The two main inquiries are[1]:

   a)whether the applicant has made out a prima facie case, in the sense that if the evidence remains as it is there is a probability that at the trial of the action the applicant will be held entitled to relief;

   b)whether the inconvenience or injury which the applicant would be likely to suffer if an injunction were refused outweighs or is outweighed by the injury which the respondent would suffer if an injunction were granted.

Background

[1] See Australian Broadcasting Corporation v O’Neill (2006) 227 CLR 57 at 81 [65]-[72] per Gummow and Hayne JJ, with whose statement of the organising principles Gleeson CJ and Crennan J relevantly agreed at 68 [19]

Registered trade marks

1. The Dolby group of companies is a globally recognised innovator of sound, imaging, and voice technologies.  The product range includes high quality audio noise reduction and audio encoding/compression technology sold and licensed under the DOLBY and DOLBY DIGITAL marks[2].

   [2] White 1 at [5]

2. The first applicant is the owner of a number of trade marks registered under the Trade Marks Act in class 9 for the words DOLBY, DOLBY DIGITAL and the double-D logo [3].

   [3] White 1 at [6], Exhibit EJW-1 at pages 1-11 (the Dolby Marks)

Seizure of DVDs

1. On 2 August 2013, Customs seized 6,600 DVDs bearing trade marks that were considered to be substantially identical with or deceptively similar to the Dolby Marks[4].

   [4] White 1 at [9], Exhibit EJW-1 at pages 14-19

The statutory scheme relating to the importation of goods infringing Australia trade marks

1. The DVDs were seized in accordance with the provisions of Part 13 of the Trade Marks Act.

2. Section 131 provides that the object of Part 13 is to protect registered trade marks by making provision allowing the Chief Executive Officer of Customs (defined in s.6 as the “Customs CEO”) to seize and deal with goods that are imported into Australia if the importation infringes, or appears to infringe, a registered trade mark.

3. The statutory scheme and relevant facts are as follows.

4. Under s.132, a notice in writing may be given to the Customs CEO objecting to the importation after the date of the notice of goods that infringe a registered trade mark.  A person who gives such an objection is called an “objector” and a trade mark in respect of which a notice under s.132 is in force is called a “notified trade mark”[5].  In the present case, the Notice of Objection in respect of the Dolby Marks given by the second applicant is at White 1 at [7], Exhibit EJW-1 at pp 12-13.

   [5] Section 6

5. By s.133, where goods are manufactured outside Australia and are imported into Australia and those goods:

   ·have applied to them or in relation to them a sign that, in the opinion of the Customs CEO, is substantially identical with, or deceptively similar to, a notified trade mark; and

   ·are goods in respect of which the notified trade mark is registered;

   then the Customs CEO must seize the goods unless he or she is satisfied that there are no reasonable grounds for believing that the notified trade mark is infringed by the importation of the goods.  These are defined in s.6 as “seized goods”.  As mentioned, in the present case, the DVDs were seized on 2 August 2013.

6. Under s.134, the Customs CEO must then give notice of the seizure to:

   ·the “designated owner” defined in s.6 as, relevantly, the person identified as the owner of the goods on the entry made in relation to the goods under s.68 of the Customs Act 1901 (Cth);

   ·the objector.

   In the present case, the “designated owner” was identified as “Wave Imports International”[6].  This is a business name registered by Mr Kamil[7].

   [6] White 1 at [9]; Exhibit EJW-1 at page 14

   [7] White 1 at [11], Exhibit EJW-1 at page 20

7. A designated owner may consent to forfeiture of seized goods[8].  That did not happen.  Instead, Mr Kamil made a claim under s.136 for release of the seized goods[9].  Dolby received notice of the claim for release in accordance with s.136C.

   [8] Section 135

   [9] White 1 at [12], Exhibit EJW-1 at pages 21-24

8. On 22 August 2013 by way of letter of demand, Dolby again requested Mr Kamil to consent to forfeiture and to provide undertakings[10].  He refused[11].

   [10] White 1 at [13], Exhibit EJW-1 at pages 25-34

   [11] White 1 at [14]

9. In the absence of any further response[12], Dolby commenced this proceeding in accordance with s.137(1) on 29 August 2013.

   [12] White 1 [15]-[16]

10. Section 136D(4) is of central significance to the present application. It provides that the Customs CEO must release the seized goods if:

    a)the designated owner has made a claim for the release of the goods; and

    b)action for infringement of the notified trade mark in respect of the goods has been instituted; and

    c)at the end of a period of 20 working days commencing on the day on which the action was instituted, there is not in force an order of the court in which the action was instituted preventing the release of the goods.

    The first two paragraphs are satisfied.  The time in the third paragraph expires on 26 September 2013.

Serious question to be tried

1. There is a serious question to be tried under s.120(1) that Mr Kamil has infringed the Dolby Marks by importing the DVDs into Australia.

2. Neither Mr Kamil nor the entities named in the notice of seizure is authorised to use the Dolby technology or the Dolby Marks[13].

   [13] White 1 at [17]

3. The marks that appear on the DVDs (including “Dolby” and “Dolby Digital”) are substantially identical with or deceptively similar to the Dolby Marks[14].

   [14] White 1 at [9(a)] and [19]; Exhibit EJW-1 at page 14 and page 40

4. The words printed on the DVDs contain a number of spelling, grammatical and formatting errors.  Further, the statements on the DVDs do not reflect Dolby’s official wording.  This indicates that the marks have been applied to the DVDs without the licence or authority of Dolby[15].

   [15] See White 1 at [19]-[21]

Balance of convenience

1. The balance of convenience favours the grant of interlocutory relief.

2. The orders sought in prayers 1 and 2 are necessary in order to preserve the subject matter of the proceeding. Orders of this kind are expressly contemplated by s.136D(4). In the absence of these orders, the DVDs will be released to Mr Kamil on or shortly after 26 September 2013. If the DVDs were to be released to Mr Kamil, there is a real risk that he will dispose of them. He has refused to consent to the forfeiture of the DVDs. Further, he has not given any undertakings.

3. The orders sought in prayer 3 are sought pending the final determination of the proceeding to prevent Mr Kamil from infringing Dolby’s registered trade marks.  The size of the consignment indicates that this was a deliberate and significant commercial transaction.  Mr Kamil persisted in this course of conduct by pursuing the DVDs after notice of Dolby’s claims and refusing to consent to their forfeiture.  He has not offered any undertakings to refrain from such activities.

Conclusion

1. For these reasons, I accept that interlocutory relief should be granted.  Dolby offers the usual undertaking as to damages[16].

   [16] White 1 at [22]

2. I will make further procedural orders to progress the matter.

I certify that the preceding thirty-one (31) paragraphs are a true copy of the reasons for judgment of Judge Driver

Associate: 

Date:  11 September 2013

Schedule A

The Registered Trade Marks

Trade mark	Reg. no.	Class	Particular goods in respect of which trade mark is registered
237207	9	Instruments and apparatus for measuring, testing, sound and vision recording, sound and vision reproduction, and for the reduction or suppression of noise in systems for recording and/or reproducing or transmitting audio, video or other signals; and magnetic tape, disc or other recordings
DOLBY	238381	9	Instruments and apparatus for measuring, testing, sound and vision recording, sound and vision reproduction, and for the reduction or suppression of noise in systems for recording and/or reproducing or transmitting audio, video or other signals; and magnetic tape, disc, or other recordings
DOLBY	384600	9	Instruments and apparatus for: sound recording, sound reproduction, and sound reception namely tuner amplifiers and car radios; instruments and apparatus for reduction or suppression of noise in systems for: recording sound signals, reproducing sound signals, recording sound and video signals, and reproducing sound and video signals; record players and tape recorders; magnetic tape, video tape, cinematographic film, all having material recorded or encoded thereon; recording studios professional audio equipment.
DOLBY	475061	9	Instruments and apparatus for measuring in relation to the sound and/or vision industries; instruments and apparatus for testing in relation to the sound and/or vision industries; instruments and apparatus for sound and vision recording; instruments and apparatus for sound and vision reproduction; instruments and apparatus for sound transmissions; instruments and apparatus for sound and visiontransmissions; instruments and apparatus for sound and vision reception; instruments and apparatus for reduction or suppression of noise in systems for transmitting sound signals; instruments and apparatus for reduction or suppression of noise in systems for transmitting sound and video signals; video cameras, film cameras, film projectors; discs and other recordings
534090	9	Apparatus for use in connection with the processing, recording, reproduction, transmission, and reception of electronic signals; pre-recorded magnetic tapes; pre-recorded video discs; cinematographic films; and power supplies in this class; and alignment and test equipment for electronic apparatus
534091	9	Apparatus for use in connection with the processing, recording, reproduction, transmission, and reception of electronic signals; integrated circuits; pre-recorded magnetic tapes; pre-recorded video discs; cinematographic films; power supplies in this class; and alignment and test equipment for electronic apparatus
DOLBY DIGITAL	771156	9	Apparatus for use in connection with the processing, recording, reproduction, transmission, and reception of electronic signals; cinema sound processors for motion picture soundtracks; cinematographic films; multi-channel sound processors; integrated circuits; audio/video amplifiers and receivers; television receivers; video monitors; video tuners; audio and video recorders; audio and video disc players; audio and video disc dubbing decks; pre-recorded audio discs, video discs, laser discs, digital video disc video discs, and digital video disc audio discs; digital video disc players, cable television receivers and decoders; remote control units for these goods; computers; computer programs having sound generating capabilities; electronic broadcast signal processors; electronic satellite broadcast signal processors in International Class 9
1223402	9	Audio and video equipment, apparatus, components and accessories used for generating, processing, measuring, analysing, recording, amplifying, enhancing, producing, reproducing, transmitting, controlling, testing, receiving and playing audio signals, files, and sounds, and visual signals, files and images; computer programs, computer software, computer hardware and components of computers and other digital devices used for generating, processing, measuring, analysing, recording, amplifying, enhancing, reproducing, transmitting, controlling, testing, receiving and playing audio signals, files and sounds, and visual signals, files and images, and instructions manuals for all the aforesaid goods sold as a unit; video game machines, video game software; 3-D glasses; wireless telecommunications devices, namely, mobile telephones and handheld electronic digital devices for use in reproducing, transmitting, receiving and playing audio signals, files and sounds, and visual signals, files and images; components of computer hardware, namely, sound cards and motherboards; integrated circuits, digital signal processing chips; recorded audio and video tapes, discs and electronic files featuring the spoken word, music, sound effects, entertainment and general information; cinematographic films, cinematographic equipment, alignment and test equipment for apparatus for use in connection with audio and video equipment, apparatus, components, and accessories in this class; scientific, nautical, surveying, photographic, cinematographic, optical, weighing, measuring, signalling, checking (supervision), life-saving and teaching apparatus and instruments; apparatus and instruments for conducting, switching, transforming, accumulating, regulating or controlling electricity; apparatus for recording, transmission or reproduction of sound or images; magnetic data carriers, recording discs; automatic vending machines and mechanisms for coin-operated apparatus; cash registers, calculating machines, data processing equipment and computers; fire-extinguishing apparatus