Fernwood Fitness Centre Pty Ltd v Today's Woman Health and Fitness Pty Ltd
[1998] FCA 491
•8 MAY 1998
FEDERAL COURT OF AUSTRALIA
INJUNCTIONS - application for interlocutory injunction restraining fitness gymnasium from representing it was affiliated, connected or associated with applicant female fitness centre - whether serious issue to be tried - whether balance of convenience in favour of relief.
TRADE PRACTICES - misleading and deceptive conduct - elements of action - whether reputation acquired in the words “today’s woman” distinctive of business - use of descriptive words in advertising and promotional material - whether acquired secondary meaning - whether a misrepresentation that businesses affiliated or associated with each other.
INTELLECTUAL PROPERTY - passing off - elements of action - whether reputation established - whether a misrepresentation.
Trade Practices Act 1974 (Cth): s 52, s 53(aa), (c), (d)
Pt V
Hornsby Building Information Centre Pty Ltd v Sydney Building Information Centre Ltd (1978) 140 CLR 216 - considered
Equity Access Pty Ltd v Westpac Banking Corporation (1989) 16 IPR 431 - considered
Telmak Teleproducts (Australia) Pty Ltd v Coles Myer Limited (1989) 15 IPR 362 - considered
FERNWOOD FITNESS CENTRE PTY LTD v TODAY’S WOMAN HEALTH AND FITNESS PTY LTD & ORS
VG 153 OF 1998
GOLDBERG J
MELBOURNE
8 MAY 1998
IN THE FEDERAL COURT OF AUSTRALIA
VICTORIA DISTRICT REGISTRY
VG 153 of 1998
BETWEEN:
FERNWOOD FITNESS CENTRE PTY LTD
(ACN 056 146 788)
ApplicantAND:
TODAY'S WOMAN HEALTH AND FITNESS PTY LTD
(ACN 080 242 799)
First RespondentPETER McCOMB
Second RespondentDENISE HARRIS
Third RespondentWILLIAM EDWARD BARTON
Fourth RespondentJUDGE:
GOLDBERG J
DATE OF ORDER:
8 MAY 1998
WHERE MADE:
MELBOURNE
THE COURT ORDERS THAT:
The applicant’s application for interlocutory relief be dismissed.
The applicant pay the respondents’ taxed costs of and incidental to the application for interlocutory relief.
The respondents deliver up to the applicant by 4.00pm on 11 May 1998 the computer software program referred to in paragraph 23 of the affidavit of Peter Guy McComb sworn 1 May 1998 with liberty reserved to the respondents to apply to vary this order.
The respondents file and serve their defences on or before 4.00pm on 19 May 1988.
The parties file and serve lists of documents on or before 4.00pm on 9 June 1998.
There be an inspection of discovered documents on or before 16 June 1998.
The summons for directions be adjourned to 26 June 1998 before Merkel J.
Note:Settlement and entry of orders is dealt with in Order 36 of the Federal Court Rules
IN THE FEDERAL COURT OF AUSTRALIA
VICTORIA DISTRICT REGISTRY
VG 153 of 1998
BETWEEN:
FERNWOOD FITNESS CENTRE PTY LTD
(ACN 056 146 788)
ApplicantAND:
TODAY'S WOMAN HEALTH AND FITNESS PTY LTD
(ACN 080 242 799)
First RespondentPETER McCOMB
Second RespondentDENISE HARRIS
Third RespondentWILLIAM EDWARD BARTON
Fourth Respondent
JUDGE:
GOLDBERG J
DATE:
8 MAY 1998
PLACE:
MELBOURNE
REASONS FOR JUDGMENT
Introduction and background
The applicant applies for interlocutory injunctions restraining the respondents, in general terms, from representing that a women’s health and fitness centre conducted by them from premises situated at 649 Port Rush Road, Glen Osmond, South Australia has any connection, affiliation or association with women’s health and fitness centres conducted or franchised by the applicant.
In December 1990 the applicant opened a female health and fitness centre in Bendigo, Victoria and subsequently a number of other female health and fitness centres in Victoria, Queensland, New South Wales and South Australia. Since around May 1994 the applicant has franchised female health and fitness centres in Victoria, Queensland, New South Wales and South Australia. Currently it either owns and operates or franchises twenty‑two female health and fitness centres. One such centre which was opened was at 184 Glynburn Road, Tranmere in South Australia (“the Tranmere Centre”).
On 16 May 1995 the applicant entered into a franchise agreement with the second and third respondents to run a Fernwood Female Fitness Centre at the Tranmere Centre. The franchise agreement was for an initial period of five years and the Tranmere Centre was conducted by either the second and third respondents or by a company incorporated and controlled by them (which is not the first respondent) until February 1998. On or about 26 September 1997 either the first and second respondents or their company gave the applicant notice that the franchise agreement was terminated but after discussions between the parties the franchisee remained in possession of the Tranmere Centre by way of a monthly tenancy until required by the applicant to vacate the premises in February 1998.
The second and third respondents procured the incorporation of the first respondent, in which the fourth respondent has an interest, and established a female health and fitness centre at 649 Port Rush Road, Glen Osmond, Adelaide. The applicant became aware of the existence of this centre in late March 1998. The applicant says that the respondents have been identifying, advertising and promoting their female health and fitness centre in such a way as to pass it off as and for a business associated with, authorised by or having the sponsorship or approval of the applicant. It is said that this is being achieved by:
(a) the use of the name “Today’s Woman”;
(b)the use of a logo comprising a line drawing of a female figure superimposed upon a green and blue block background;
(c)the use of furniture with an identical style and colour to that used in the applicant’s health and fitness centres and the use of decor and colour schemes and decorator items such as oversized sunflowers, artificial topiary trees and wall ferns similar to those used by the applicant.
There are issues between the parties as to the manner and circumstances under which the franchise agreement was terminated, the proper identity of the franchisee being either the second and third respondents or the company which they incorporated and the proper accounting for membership monies received before the second and third respondents vacated the Tranmere Centre in February 1998. However, it is not necessary to consider or make any determination in relation to these matters for the purposes of the present application.
The applicant also complains about a circular which the respondents, or some of them sent to patrons of the Tranmere Centre at or about the time the second and third respondents vacated the premises at which that centre was conducted. The circular was on the letterhead of the Fernwood Female Fitness Centre which the applicant says should not have been used by the respondents. However, on a fair reading of the circular it does not suggest a connection between the Tranmere Centre, the applicant and the new female fitness centre which the second and third respondents were then proposing to open at Glen Osmond. A complaint is also made of a note which was given by the respondents after their new health and fitness centre was set up at Glen Osmond to a patron of the Tranmere Centre which note was on the applicant’s “with compliments” slip, that is to say, on a slip with the applicant’s logo. I do not need to consider these matters any further at this stage other than to note them because they have marginal relevance to the applicant’s real complaint which is the name under which the first respondent is carrying on its female health and fitness centre and the manner in which it is presenting, advertising, promoting and marketing that centre.
The applicant says that since opening the original Fernwood Fitness Centre in Bendigo in December 1990 it has widely promoted its female health and fitness centres and those run by its franchisees throughout eastern Australia on national commercial television, in newspaper advertisements, by way of brochures, pamphlets and other documents which are circulated by extensive letter drops and by making such material available to the persons who use its fitness centres. The applicant says that since 1993 it has advertised its women’s fitness centres and those of its franchisees under and by reference to the name or slogan “Today’s Woman” which it says:
“has appeared distinctively on all or nearly all of Fernwood’s advertising material”.
The applicant also says that:
“Today’s Woman plays a major role in the applicant’s and it’s franchisees business and has done so since at least 1993.”
I will return to these assertions later.
The applicant also says that as part of the set up of a Fernwood Fitness Centre by a Fernwood franchisee the applicant provides a fit out specification and instruction manual which details all the requisite equipment, furniture, signage, layout and other special identifying features which are to be used and which are apparent in all Fernwood Fitness Centres.
The applicant says that the name “Today’s Woman” has been so used, promoted and marketed by it that it has acquired a secondary meaning distinctive of the business of the applicant so that when it is used by the first respondent there is an association with the applicant represented. The applicant says further that the use of a coloured logo and the use of coloured decor and equipment and furniture similar to that used by the applicant in its fitness centres also contributes to the representation of that association.
In response to the applicant’s contentions the respondents submit that there is no serious issue to be tried on the issues of passing off or misleading or deceptive conduct or improper attribution of sponsorship and affiliation because:
(a) there is no representation that the first respondent is associated with the applicant;
(b) the logo used by the respondents is quite different from the applicant’s logo;
(c)external signs used by the respondents are markedly different from the external signs used by the applicant;
(d)they have not used the same furniture and decor as the applicant and in any event, the applicant does not use the same furniture and decor at all its fitness centres;
(e)the words “Today’s Woman” have not acquired a secondary meaning distinctive of the business of the applicant;
(f)there is no confusion in the minds of the public.
Relevant legal principles
As an interlocutory injunction is sought it is necessary to determine whether there is a serious question to be tried and whether the balance of convenience favours the grant of relief: Australian Coarse Grain Pool Pty Ltd v Barley Marketing Board of Queensland (1982) 46 ALR 398; Tableland Peanuts Pty Ltd v Peanut Marketing Board (1984) 52 ALR 651, 653; Castlemaine Tooheys Ltd v The State of South Australia (1986) 161 CLR 148, 153 ‑ 154; Epitoma Pty Ltd v Australasian Meat Industry Employees’ Union (1984) 3 FCR 55, 58.
The applicant puts its case on the basis of common law passing off, misleading or deceptive conduct in breach of s 52 of the Trade Practices Act 1974 (Cth) and s 56 of the Fair Trading Act 1987 (SA) and false representations in breach of s 53(aa), (c), (d) of the Trade Practices Act 1974 (Cth) and s 58(b), (e), (f), (i), (k) of the Fair Trading Act (SA).
In order to establish the elements of the tort of passing off the authorities show that there is a need to establish reputation, misrepresentation and the likelihood of damage: Conagra Inc v McCain Foods (Aust) Pty Ltd (1992) 33 FCR 302; Reckitt and Colman Products Limited v Borden Inc (1990) 17 IPR 1, 7; Vieright Pty Limited v Myer Stores Limited (1995) ATPR ¶41‑405 at 40,486. What has been accepted as an authoritative statement of the elements required to establish the cause of action of passing off is found in the judgment of Lord Diplock in Erven Warnink B V v J Townend & Sons (Hull) Limited [1979] AC 731 (the Advocaat case) where at 742 Lord Diplock stated the five characteristics which needed to be present to establish the cause of action of passing off as:
“(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 of another trader (in the sense that this is a reasonably foreseeable consequence) and
(5)which causes actual damage to a business or goodwill of a trader by whom the action is brought or (in a quia timet action) will probably do so.”
This statement has been accepted in Australia: Moorgate Tobacco Co Limited v Philip Morris Limited (No 2) (1984) 156 CLR 414, 443 ‑ 444 per Deane J; Conagra Inc v McCain Foods (Aust) Pty Ltd (supra) 308 ‑ 310. Although it was said in Reckitt and Colman Products v Borden Inc (supra) that the law of passing off can be summarised in one short general proposition - no man may pass off goods as those of another, it is nevertheless necessary as Lord Oliver said in that case to establish three elements to constitute the cause of action of passing off - first goodwill or reputation attaching to the relevant goods in the mind of the purchasing public by association with the identifying get‑up, such that the get‑up is recognised by the public as distinctive specifically of the applicant’s goods; secondly, a misrepresentation leading, or likely to lead, the public to believe that the respondent’s goods are the goods of the applicant or a particular source; thirdly, the suffering, or likely suffering, of damage by reason of the erroneous belief engendered by the misrepresentation.
The causes of action based on s 52 and s 53 of the Trade Practices Act 1974 (Cth) require a similar but not necessarily the same analysis. Those sections are contained in Pt V of the Trade Practices Act 1974 (Cth) which is concerned with conduct which affects members of the public in their capacity as consumers of goods or services and it is not concerned merely with the protection of the reputation of all goodwill of competitors in trade or commerce: Hornsby Building Information Centre Pty Ltd v Sydney Building Information Centre Ltd (1978) 140 CLR 216. In Equity Access Pty Ltd v Westpac Banking Corporation (1989) 16 IPR 431 Hill J set out a number of propositions at 440 ‑ 442 which applied in relation to the integers of a cause of action under s 52 of the Trade Practices Act 1974 (Cth) which can be summarised as follows:
(a)for conduct to be misleading or deceptive conduct it must convey, in all the circumstances, a misrepresentation;
(b)there will be no contravention of s 52 unless the error or misconception which occurs results from the conduct of the corporation and not from other circumstances for which the corporation is not responsible;
(c)conduct will be likely to mislead or deceive if there is a “real or not remote chance or possibility” of misleading or deceiving regardless of whether it is less or more than 50%;
(d)conduct causing confusion or uncertainty in the sense that members of the public might have been caused to wonder whether the two products or services might have come from the same source is not necessarily co-extensive with misleading or deceptive conduct;
(e)the applicant must establish that it has acquired the relevant reputation in the name, that is that the name has become distinctive of the applicant’s business or products.
There is an added issue in this proceeding because the words relied upon by the applicant as being distinctive of its business, namely “Today’s Woman” can fairly be described as descriptive words. However, the fact that a word is a descriptive term does not, of itself, mean it cannot be used to distinguish a person’s goods or services or that it has not succeeded in achieving such a distinction. Much will depend upon the nature and cogency of the evidence: The Kettle Chip Co Pty Limited v Apand Pty Limited (formerly CCA Snack Foods Pty Ltd) (1993) 46 FCR 152, 165 ‑ 166. In Dodds Family Investments Pty Ltd v Lane Industries Pty Ltd (1993) 26 IPR 261 the Full Court, at 269 adopted the following passage from the judgment of Hill J in Equity Access Pty Ltd v Westpac Banking Corporation (supra) at 445:
“Just as the distinction between descriptive and fancy names is not a distinction of law so too it is wrong to see the distinction in black and white terms. The reality is that there is a continuum with at the extremes purely descriptive names at the one end, completely invented names at the other and in between, names that contain ordinary English words that are in some way or other at least partly descriptive. The further along the continuum towards the fancy name one goes, the easier it will be for a plaintiff to establish that the words used are descriptive of the plaintiff’s business. The closer along the continuum one moves towards a merely descriptive name the more a plaintiff will need to show that the name has obtained a secondary meaning, equating it with the products of the plaintiff (if the name admits of this - a purely descriptive name probably will not) and the easier it will be to see a small difference in names as adequate to avoid confusion.”
I am also mindful of the observations of Stephen J in Hornsby Building Information Centre Pty Ltd v Sydney Building Information Centre Ltd (supra) at 229:
“There is a price to be paid for the advantages flowing from the possession of an eloquently descriptive trade name. Because it is descriptive it is equally applicable to any business of a like kind, its very descriptiveness ensures that it is not distinctive of any particular business and hence its application to other like businesses will not ordinarily mislead the public. In cases of passing off, where it is the wrongful appropriation of the reputation of another or that of his goods that is in question, a plaintiff which uses descriptive words in its trade name will find that quite small differences in a competitor’s trade name will render the latter immune from action.”
(See also Cadbury Schweppes Pty Ltd v Pub Squash Co Pty Ltd (1980) 2 NSWLR 851, 857).
The applicant says that the evidence before the Court discloses a serious question that the respondents have copied the name (“Today’s Woman”) logo and get‑up of the applicant. Although proof of copying may indicate an intention to deceive, such an intention is not a necessary ingredient of a s 52 cause of action and even if such intention to deceive be disclosed it is still necessary to establish a misrepresentation as to the source of goods and services: Cadbury Schweppes Pty Ltd v Pub Squash Co Pty Ltd (supra); Hornsby Building Information Centre Pty Ltd v Sydney Building Information Centre Ltd (supra); Telmak Teleproducts (Australia) Pty Ltd v Coles Myer Limited (1989) 15 IPR 362.
Has the applicant acquired a reputation in “Today’s Woman”?
In order to determine whether there has been passing off or a misrepresentation by the respondents’ use of the words “Today’s Woman” in the name of the first respondent and in the name by which the business of the respondents is presented, advertised, promoted and marketed it is necessary to determine whether there is a serious question to be tried in relation to the threshold question whether the applicant has acquired a reputation in relation to its business by reference to those words to the extent that they have acquired a secondary meaning referable to the applicant’s business and are distinctive of it. The applicant submits that the evidence discloses such a reputation and a secondary meaning and it is therefore necessary to examine that evidence with some care.
As I noted earlier the applicant says that since 1993 the name or slogan “Today’s Woman” has appeared distinctively on all or nearly all of its advertising material and plays a major role in the applicant’s and franchisees’ businesses. In my opinion, this contention is not made out when the evidence is examined carefully or, put more accurately for present purposes, a serious question does not arise that this is the case. Exhibit JLC 2 to the affidavit of John Lesley Clow, a director of the applicant, contains a bundle of brochures, leaflets, newsletters and other advertising leaflets distributed by the applicant since 1990. Although some of these pre‑date 1993 a number of them have obviously come into existence since 1993 and I turn to a consideration of those documents.
One brochure is headed “A Special Invitation” and shows on its backsheet Fernwood centres located, inter alia, at Tranmere. The frontsheet of this brochure refers to “Fernwood Fitness invites you ...” and refers to “Fernwood for the woman who deserves the best”. It displays a logo of a line drawing of a kneeling woman with the word “Fernwood” printed vertically adjacent to it and with the words “Female Fitness Centre” in its bottom right hand corner. The logo is superimposed on three blocks which in this instance are monochromatic but in other instances are blue and green. I will refer to this description of the logo hereafter as “the logo”. The logo appears on the second sheet adjacent to the words “Fernwood Female Fitness Centres” and on the backsheet there is a reference to “today’s woman”. Immediately thereafter there appear the words:
“Fernwood Female Fitness Centres are committed to helping you, today’s busy woman, keep your commitment to regular exercise, healthy eating and time out, for yourself”.
The words “Today’s Woman” do not appear on the front of the brochure.
There is then a brochure entitled “mind Body spirit” and underneath that appear the words “Fresh Start ‘95”. The logo appears on the front as do the words “Fernwood Female Fitness Centres” but there is no reference on the front of the brochure to “Today’s Woman”. Those words appear on the second sheet immediately followed by the same words as appeared on the back of the first brochure to which I have referred namely:
“Fernwood Female Fitness Centres are committed to helping you, today’s busy woman, keep your commitment to regular exercise, healthy eating and time‑out, for yourself”.
There is then a brochure entitled “fitness for women”. The logo is displayed on the frontsheet, albeit without the blocks, and the word “Fernwood” is also displayed. The words “Today’s Woman” do not appear anywhere in the brochure. The applicant’s “with compliments” slip displays the logo but there is no reference to “Today’s Woman” on it. There is a coloured brochure on the frontsheet of which appears the word “Life ...” and the logo and the words “Fernwood Female Fitness Centres” but there is no reference to “Today’s Woman”. There are then a number of special invitation cards which bear the logo, the words “Fernwood Female Fitness Centres” but no reference to “Today’s Woman”. The Fernwood gift voucher displays the logo and the words “Fernwood Fitness Centres” but there is no reference to “Today’s Woman”. There is a brochure entitled “Membership Information”. On the front there is a reference to “Fernwood Fitness Centres”, the logo is displayed but there is no reference to “Today’s Woman”. On the reverse of the frontsheet there is a reference to “today’s woman” under which appear the words:
“Fernwood Fitness Centres have a special mission.
To help you, today’s busy woman, take charge of your own well being to look and feel better than every before.
...”
There are then four newsletters entitled “Today’s Woman” which words appear as the mast head or banner of the newsletters. In two of these newsletters the logo appears in juxtaposition to those words. However, the words “Today’s Woman” on these newsletters appear to be rather an identification of the subject‑matter of the newsletters or an identification of the audience to which it is addressed rather than as seeking to identify the business which the words describe, or of which they are distinctive. There is then a brochure entitled “fernwood for today’s WOMAN”. At the top of each sheet of this brochure the words “today’s WOMAN” appear.
The applicant then points to a full colour brochure advertising the applicant which was first used in December 1993 for promotion of its Bendigo centre where approximately 30,000 of such brochures were distributed. The applicant says that this was the first time that it included the slogan “Today’s Woman” in its advertising material. The applicant says that a further 30,000 brochures approximately were distributed in May 1994 and that the coloured brochure has been included in all information packages sent out to potential franchisees in the 1994/1995 period. On the front of this brochure there is a photograph of a woman roughly in the position of the line drawn figure in the logo together with the words “fernwood” and “FEMALE FITNESS CENTRE”. The brochure opens out and there is then depicted in words and photographs the activities of the fitness centres. The logo is also displayed and also appears on the backsheet of the brochure. On another backsheet of the brochure the words “today’s woman” appear above the words:
“Fernwood Fitness has a special mission. To help you, today’s busy woman, take charge of your own well being, too (sic) look and feel better than ever before, naturally.”
The words “today’s woman” do not appear on the frontsheet of the brochure.
The applicant then points to a “today’s woman” advertising brochure used extensively in the promotion of the Bendigo and Ballarat fitness centres in about May 1994 at which time approximately 60,000 fliers were distributed. It was also used in later information packages. That brochure or leaflet also has under the words “Today’s Woman” the words in the previous brochure to which I have referred, namely:
“Fernwood Fitness has a special mission. To help you, today’s busy woman, take charge of your own well being, to look and feel better than ever before, naturally.”
The logo also appears on the brochure.
There is then produced a news publication headed “today’s woman” and it is said that such a newspaper was produced and circulated on each occasion when a Fernwood operated or franchise centre was opened. It is said that in the case of the Tranmere Centre approximately 40,000 such newspapers were circulated as were approximately 20,000 brochures headed “A Special Invitation”. The invitation on its front depicts the logo and refers to the invitation coming from “Fernwood Fitness”. The words “Today’s Woman” do not appear on the front of the brochure but they do appear on the back of the brochure immediately before the words:
“Fernwood Fitness has a special mission.
To help you, today’s busy woman, to take charge of your own well being, to look and feel better than ever before. ...”
Since January 1998 the applicant and its centres have been extensively advertised using the services of the well known Olympian and sports celebrity Lisa Curry. Television promotions or advertisements have been used featuring Lisa Curry but there is no reference either visually or aurally, in any of these promotions or advertisements to the words “Today’s Woman”. Lisa Curry has also been used and promoted in two “A Special Invitation” brochures. On one of these brochures which displays the logo and the name “fernwood” there is no reference to “Today’s Woman”. On the other brochure the frontsheet displays a picture of Lisa Curry, the logo and the name “fernwood”. On the backsheet there is a heading “today’s woman” under which appear the words:
“Fernwood Female Fitness Centres are committed to helping you, today’s busy woman, keep your commitment to regular exercise ...”
The logo and “fernwood” are displayed as well.
Lisa Curry also appears in an advertisement in the edition of “The Times” (a suburban newspaper) for 21 January 1998. The advertisement displays the logo, is expressed to contain “A Special Invitation”, displays a photograph of Lisa Curry and refers to “Fernwood” and “Ladies’ Health and Fitness Clubs”. There is no reference to “Today’s Woman”.
The applicant has also used other television advertisements for its business and says that its business was used on promotional spinning wheels used in two television programs for many months but it does not suggest that the words “Today’s Woman” were referred to in these programs or used on the wheels.
The promotional package which the applicant gives to all its potential franchisees contains a number of documents which display the logo and the words “Fernwood”. However, apart from the inclusion of a copy of “Today’s Woman” newsletter in the form to which I have referred, there is no reference in the documents in the promotional package to the words “Today’s Woman”. The inside of the cover of the package is headed “Fernwood Fitness has a special mission” which is described as “to help today’s busy women take charge of their own well being ...”. The package also includes the business cards of Diana Williams the managing director of the applicant and John Clow a director of the applicant and these business cards display the logo and the words “Fernwood Fitness Centres Exclusively for Women”. They contain no reference to “Today’s Woman”.
In the applicant’s franchise agreement there is a reference (Recital B) to certain trademarks and trade names for which the applicant has applied for rights in connection with the business. These are set out in Schedule 2 and are “Fernwood”, “Fernwood Female Fitness Centre(s)”, “Fernwood Fitness Centre” and the logo. In relation to the logo the pantone colours are identified as is the font for the word “Fernwood”.
In the fitout specifications and instructions manual provided by the applicant to its franchisees there is a covering letter which displays the logo but there is no reference to “Today’s Woman”. There is included in the manual the styles to be used for the logo and for the word “Fernwood” but there is no reference to any style, type or font to be used for the words “Today’s Woman”. The manual does include the special invitations to which I have earlier referred with “Today’s Woman” on their backsheet and a copy of one of the “Today’s Woman” newsletters.
The respondents have produced the advertisement placed by the applicant in the Telstra yellow pages Melbourne telephone book. It is headed “fernwood” and displays the logo. There is a reference to “fernwood female fitness centres” but there is no reference to “Today’s Woman”. The respondents also produced the advertisement placed by the applicant in the Telstra yellow pages for Adelaide. It is headed “Exclusively for Women”. The logo is displayed and there is a reference to “Fernwood Female Fitness Centres”. There is no reference to “Today’s Woman”.
It is also important to identify the signage used by the applicant outside its fitness centres. Photographs of these signs are found in the fitout specifications and instructions manual and they show that the signs display the logo and the name “fernwood FEMALE FITNESS CENTRE”. The manual also includes photographs of the interiors of the fitness centres which also display the logo. The words “Today’s Woman” do not appear in any of these photographs. The respondents have also produced a photograph of the external signage of one of the applicant’s fitness centres which is consistent with the photographs in the manual.
A review of this evidence shows, in my opinion, that it is not correct to say, as Mr Clow said in his affidavit, that “the name or slogan ‘Today’s Woman’” has “appeared distinctively on all or nearly all of Fernwood’s advertising material” or that it plays a major role in the applicant’s and its franchisees’ businesses and has done so since at least 1993. Although those words have been used in the newsletters and on the backsheets or inside covers of some of the brochures or leaflets they have not been depicted or displayed in a way which identifies “Today’s Woman” as a badge of origin or source of the applicant’s business. If it was intended that the words “Today’s Woman” were intended to be distinctive of the applicant’s business one might have expected to have found them referred to in some form in the yellow pages advertisements, on the letterhead of the applicant, on the front of the brochures containing membership information and special invitations, on the invitation cards making special offers, on the business cards and in the television advertisements. The words “Today’s Woman” do not appear in most of these documents and where they do appear, they do not appear prominently to the extent of being distinctive of the applicant’s business. To the extent to which the words do appear in the membership information and special invitation brochures, they do not do so in a way which identifies the words “Today’s Woman” as distinctive of and referable to and only referable to the applicant’s business. Rather, such reference as appears to “Today’s Woman” is a reference, in my opinion, to the addressee of the comments, observations or text which appear below those words to which I have already referred. I make the same observations about the newsletters. Although the words “Today’s Woman” appear as a mast head or banner of the newsletters, the words do not purport to be distinctive of the applicant’s business but rather appear to identify the subject‑matter of the newsletters or the addressees or readership of it.
I do not consider therefore that the evidence discloses a serious question to be tried either that the applicant has used the words “Today’s Woman” as being distinctive of its business in such a way as to indicate that any reference to “Today’s Woman” is expected to be a reference and intended to be a reference to the applicant’s business. I am not satisfied that there is a serious question as to whether the words “Today’s Woman” have acquired a secondary meaning to the extent that they are distinctive of the applicant’s business. Put shortly, I do not consider that there is a serious question to be tried as to whether the applicant has an established reputation in the words “Today’s Woman”.
Has there been a misrepresentation?
Even if I am wrong in this respect I am not satisfied that there is a serious question to be tried as to whether the respondent has made a representation that it is associated with or affiliated with or has some connection with the applicant and its business. In the circulars which the respondents sent out in February and March 1998 they did not suggest, infer or represent that there was such an association or affiliation or connection. Although the undated circular which was sent to members some time in February was on the letterhead of Fernwood Female Fitness Centre, the letter makes it clear that it is a new business which is starting unconnected with the Fernwood franchise. The later circular on the letterhead of the first respondent also did not make any representation of any such association or affiliation with the applicant.
The brochure or card sent out some time in March by the respondents gets closer to what the applicant contends is an identification with its business in the sense that it refers to “Today’s Woman” and then refers to opening specials. It also contains a logo with an outline drawing of a woman in an upright, slightly sideways, stretching position. Although it is superimposed on a three block coloured background, one of those colours is yellow, not found in the applicant’s logo, although the other two colours blue and green are so found. Further, there is written in a generally vertical direction alongside the logo the words “Today’s Woman Health & Fitness”. Although in a general way this depiction has similarities to the applicant’s logo there is a sufficient distinction from it by reference to the extra colour block , the different line drawing and position of the figure and the name which, in my view, does not result in there being a serious question as to whether there is any representation of association or affiliation with the applicant’s business by the use of this brochure.
The signage and display outside the respondents’ fitness centre is quite different and distinct from that outside the applicant’s centres. The applicant’s signage comprises the logo and prominence is given to the name “fernwood”. By contrast, the respondents’ signage comprises the words “Today’s Woman Health & Fitness Centre”. The sign at street level displays “Today’s Woman” on the yellow block background and on the building the words “Today’s Woman Health & Fitness” are displayed but with the word “Fitness” on the yellow background and a green block partially under the words “Today’s” and “Health”. I do not consider that there is a serious question to be tried whether the respondents’ signage is a representation of association or affiliation with the applicant’s business.
If, as the applicant contends, the words “Today’s Woman” have acquired a secondary meaning distinctive of the applicant’s business, not only would I have expected those words to be used or displayed in some way on or in the applicant’s fitness centres and in a prominent and eye catching position in its advertising, promotional and marketing material and on its stationery and business cards; I would have expected it to be found in some form in the applicant’s signage. Even if the applicant is relying on the use of the words “Today’s Woman” not so much as the name of the business but rather as a slogan identifying the applicant’s business and being distinctive of it, I would still have expected to have found the words on or in the applicant’s fitness centres and in the documentation in the manner to which I have referred.
The applicant submits, and invites me to infer, that the respondents have deliberately used and copied the logo and the words “Today’s Woman” from the use which they knew was made of those words and logo by the applicant. For present purposes on this interlocutory application I am prepared to make that assumption. However, drawing that inference, of itself, does not result in there being a serious question to be tried as to whether the words “Today’s Woman” have acquired a secondary meaning distinctive of the applicant’s business or that there has been a misrepresentation by the respondents by the use of those words. As was pointed out by the majority, Wilcox and Einfeld JJ, in Telmak Teleproducts (Australia) Pty Ltd v Coles Myer Limited (supra) 378 ‑ 379, 383:
“In the case of ordinary English words, proof of deliberate copying affords some evidence that people might be misled by the words. However, that proof is less significant than in the case of a ‘fancy’ word; ...
...
Proof of copying, indicating an intention to deceive, is of powerful evidentiary value. As Lord Simonds rhetorically asked: ‘who knows better than the trader the mysteries of his trade?’ But such evidence is not necessarily decisive. The question remains whether, upon the whole of the evidence, the plaintiff has established a misrepresentation.
...
As I (sic) have already observed, proof of the fact that a trader has deliberately copied the name or ‘get‑up’ of a rival does not itself establish a contravention of s 52 or a passing off of goods. The proof has evidentiary value only. But the evidentiary value is significant. The courts have long recognised that traders know their trade”.
(See also Australian Woollen Mills Limited v FS Walton and Co Limited (1937) 58 CLR 641; Conagra Inc v McCain Foods (Aust) Pty Ltd (supra) at 345; WD & HO Wills (Australia) Ltd v Phillip Morris Limited (1997) 39 IPR 356).
It is still necessary to establish that the relevant words have acquired a secondary meaning and that they are distinctive of the applicant’s business. Even if I make the assumption which the applicant invites me to make, I am still not satisfied that there is a serious question to be tried for the reasons to which I have referred. The situation is the same in relation to the decor, fixtures, fittings and colour schemes used in the applicant’s fitness centres. Reputation and goodwill can reside just as much in get‑up and presentation as in a trade name: The Kettle Chip Co Pty Limited v Apand Pty Limited (supra); Parkdale Custom Built Furniture Pty Ltd v Puxu Pty Ltd (1989) 149 CLR 191; WD & HO Wills (Australia) Ltd v Philip Morris Limited (supra). However, on the present state of material I am not satisfied there is a serious question to be tried as to whether the decor, fixtures and fittings and colour schemes used in the applicant’s fitness centres are distinctive of the applicant’s fitness centres in the minds of patrons or potential patrons of fitness centres.
I have approached this matter on the basis of a consideration of the applicant’s evidence with some consideration to those parts of the respondents’ evidence which are non‑controversial such as the production of the Telstra yellow pages entries by the applicant in Melbourne and Adelaide. A number of issues are contested between the parties such as the manner in which the vacation of the premises at Tranmere occurred and the circumstances under which fixtures, fittings and decor have been used and presented in the respondents’ new premises. I do not need to consider these contested matters in any detail for the purpose of reaching the conclusion which I have reached. However, I note that the glossy brochure or card upon which the applicant relies which refers to “Today’s Woman” opening special and contains the logo on it is said by the respondents to be no longer in use and the respondents produce their current brochure which will not be used after approximately two weeks. That current brochure has a different logo with the female figure in substantially the same position but depicted as a silhouette against a yellow, blue and green block background rather than as a line drawing. The respondents say the logo on the two brochures will not be used as they have not been successful in attracting business. If I had decided that there was a serious question to be tried, I would have taken these matters into account in determining whether any relief should be granted.
It is not therefore necessary to consider whether the balance of convenience is so weighted in favour of the applicant that an injunction should be granted. The determination of the issues of whether there is a serious case to be tried and whether the balance of convenience favours the grant of an injunction should not be considered in isolation from each other as the balance of convenience may be affected by the view formed by a court on the strength or weakness of an applicant’s case: Castlemaine Tooheys Ltd v The State of South Australia (supra) at 155; Reprinting and Kindred Industries Union; Ex parte Nationwide News Pty Ltd (t/as Cumberland Newspaper Group) (1994) 122 ALR 303, 316.
Even if I be wrong as to whether there is a serious question to be tried as to whether the applicant has established that the words “Today’s Woman” are distinctive of its business and whether there has been a misrepresentation by the respondents by the use of those words and the logo and get‑up which they have used, I consider that the balance of convenience is against the grant of an injunction having regard to what I perceive to be the weakness of the applicant’s case. The applicant is concerned with one of some twenty‑two fitness centres whereas the respondents will be affected in relation to their sole business. Although the applicant moved very quickly once it became aware of the matters of which it makes its complaint the respondents have spent a substantial sum of money setting up their business by reference to the name and get‑up which they have used. If the injunction sought by the applicant were granted the respondents would not be put out of business but there would be a significant and substantial disruption to the business. Balanced against that is the fact that the applicant may lose custom at its Tranmere Centre to the respondents but an analysis could be undertaken of the extent to which patrons of the respondents’ fitness centre thought there was an association with the applicant’s Tranmere Centre. I also note that Mr Clow has said that since the second and third respondents vacated the Tranmere Centre in February 1998, 600 members have remained at the centre notwithstanding that their money has gone to the second and third respondents. Mr Clow says the applicant is honouring their membership. It does not appear that the Tranmere Centre or the applicant will suffer any irreparable harm if an injunction is not granted at the present time.
In all the circumstances I do not consider that even if there was a serious question to be tried the balance of convenience is in favour of the grant of the injunction.
One other matter complained of by the applicant is that the second and third respondents have retained a computer software program belonging to the applicant. The respondents deny that the program is the property of the applicant and that they are using it but they do not oppose an order for its delivery up and I will so order.
The application will be dismissed with costs.
I certify that this and the preceding eighteen (18) pages are a true copy of the Reasons for Judgment herein of the Honourable Justice Goldberg
Associate:
Dated: 8 May 1998
Counsel for the Applicant: Mr Goldblatt Solicitor for the Applicant: John R Buman & Co Counsel for the Respondent: Mr I Stewart Solicitor for the Respondent: Wisewoulds Date of Hearing: 5 May 1998 Date of Judgment: 8 May 1998
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