FEDERAL COURT OF AUSTRALIA
Henley Arch Pty Ltd v Henley Constructions Pty Ltd [2021] FCA 1369
File number(s): VID 1240 of 2018 Judgment of: ANDERSON J Date of judgment: 5 November 2021 Catchwords: TRADE MARKS – applicant commenced trading in 1989 – applicant’s registered trade marks include HENLEY, HENLEY PROPERTIES, HENLEY WORLD OF HOMES, HENLEY ESSENCE, HENLEY RESERVE and HENLEY COLLECTION – applicant’s HENLEY and HENLEY PROPERTIES trade marks registered in 2006 – first respondent commenced trading in or around 2006 under and by reference to HENLEY CONSTRUCTIONS – applicant became aware of respondent in or around 2017
TRADE MARKS – whether first respondent used applicant’s relevant trade marks in the course of trade – whether first respondent’s use of relevant signs was use of a trade mark in the course of trade – whether there was substantial identity or deceptive similarity – whether first respondent used relevant signs in relation to relevant services – whether first respondent has infringed applicant’s registered marks – first respondent has infringed applicant’s registered marks pursuant to s 120(1) of the Trade Marks Act 1995 (Cth)
CONSUMER LAW – ss 18, 29(1)(g) and 29(1)(h) of the Australian Consumer Law – ss 52, 53(c) and 53(d) of the Trade Practices Act 1974 (Cth) – whether first respondent contravened those provisions – relevant date for assessing applicant’s reputation – assessment of applicant’s reputation – consideration of class of public affected – whether first respondent’s conduct constituted misrepresentations – whether evidence of confusion – first respondent’s conduct in using the names “HENLEY CONSTRUCTIONS” and “HENLEY” was misleading or deceptive in contravention of relevant provisions
TRADE MARKS – first respondent raised defence under s 122(1)(fa) of the Trade Marks Act 1995 (Cth) – whether first respondent has a right to register HENLEY CONSTRUCTIONS – whether such registration would be refused on basis of ss 58, 44(2), 42(b) or 60 of Trade Marks Act 1995 (Cth) – first respondent did not establish defence under s 122(1)(fa)
TRADE MARKS – first respondent raised defence under s 122(1)(a)(i) of the Trade Marks Act 1995 (Cth) – whether first respondent has used own name in good faith – first respondent’s initial use of “HENLEY CONSTRUCTIONS” and “HENLEY” was not a good faith use of Henley Constructions’ name pursuant to s 122(1)(a)(i)
TRADE MARKS – first respondent raised defence under s 124 of the Trade Marks Act 1995 (Cth) – first respondent failed to establish defence
TRADE MARKS – cross-claim – first respondent claimed applicant’s trade marks did not have relevant inherent ability to distinguish relevant services – alleged applicant’s trade marks accepted by the Registrar of Trade Marks on the basis of evidence or representations that were false in material particulars – alleged relevant non-use by applicant – assessment of applicant’s use – consideration of discretion in ss 101(3) and 101(4) of Trade Marks Act 1995 (Cth) – cross-claims dismissed
TRADE MARKS – ancillary liability – whether second respondent was joint tortfeasor with first respondent in its infringement of each of the…
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- Case
- [2021] FCA 1369
- Decision Date
CaseChat Overview and Summary
The legal issues that the court had to resolve encompassed whether Henley Constructions used the applicant's trade marks in the course of trade, the validity of the applicant's trade marks, and the applicability of various statutory defences. Additionally, the court had to determine whether Henley Constructions' conduct contravened the ACL and if Sarkis was liable as an ancillary party. The court also assessed the applicant's cross-claims regarding the validity of its trade marks, including issues of distinctiveness, non-use, and false representations to the Registrar of Trade Marks.
The court found that Henley Constructions had indeed infringed the applicant's trade marks, and its initial use of the names "HENLEY CONSTRUCTIONS" and "HENLEY" was not in good faith. Henley Constructions failed to establish any valid defences under the Trade Marks Act 1995 (Cth), and its conduct was deemed misleading or deceptive under the ACL. Sarkis was found to be an ancillary party liable for the infringement and contraventions of consumer law. The court granted the applicant the declarations and injunctions sought against Henley Constructions and Sarkis, but deferred the issue of an account of profits to a separate hearing. The court also dismissed Henley Constructions' cross-claims regarding the validity of the applicant's trade marks.
The final orders required the parties to confer and propose minutes of orders to the Associate to Justice, to timetable a hearing on the relief sought by the applicant for an account of profits.
Orders
Orders of the court
1. Within 14 days of the date of this order, the parties are to have conferred and provided to the Associate to Justice Anderson proposed minutes of orders to give effect to the Reasons for Judgment of Justice Anderson in this proceeding, and to timetable the steps required for a hearing on the relief sought by the applicant of an account of profits.
Note: Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules 2011.
Background
Background to the litigation
Full text does not contain this section.
Evidence
Evidence Before The Court
Decision
Reasons for decision
Full text does not contain this section.
Ratio Decidendi
Legal Principle Established
Henley Constructions submits that, if Henley Arch succeeds in one of its causes of action, injunctive relief of the onerous kind sought in the Originating Application (which seeks to cease use of the relevant marks) ought not be granted. Henley Constructions submits that, rather, it should be ordered in the alternative that Henley Constructions places the following disclaimer on its website for a period of three years: “Henley Constructions Pty Ltd is not licensed by or associated in any way with Henley Arch Pty Ltd”.Consideration As to non-pecuniary relief, in Truong Giang Corporation v Quach (aka Quach) [2015] FCA 1097; 114 IPR 498, Wigney J stated at [90]-[91]: Section 126 of the [TMA] provides that the court may grant an injunction for an infringement of a registered trade mark. Permanent injunctions are a conventional remedy in cases involving infringement of intellectual property rights: Nokia Corporation v Truong (2005) 66 IPR 511 … at [46]; QS Holdings Sarl v Paul’s Retail Pty Ltd (No 2) [2011] FCA 1038 at [6]. Nevertheless, injunctive relief is discretionary and should only be granted in an appropriate case.Under s 232 of the ACL, the court also has the power to grant injunctions if the court is satisfied that a person has contravened, inter alia, a provision in Chapter 2 and 3 of the ACL, which includes ss 18 and 29. The court also has a power to grant an injunction restraining conduct that would aid, abet, counsel or procure another person to contravene such provisions. In these circumstances, and for the reasons given in these Reasons for Judgment, I am satisfied that it is appropriate to make the declarations and orders as to non-pecuniary relief sought by Henley Arch, save that there will be no relief in relation to the Non-Infringing Signs (referred to above in the section related to trade mark infringement). Having regard to the findings made in these Reasons, particularly the findings relating to the adoption of the name “Henley Constructions”, I am not persuaded that there are any discretionary factors which would ensure Henley Arch should not be given the non-pecuniary relief that it seeks, save that there will be no relief in relation to the Non-Infringing Signs. DISPOSITION On 31 March 2021, the parties filed an amended consolidated statement of issues which the parties agreed would determine all matters raised on the pleadings. By way of summary, the following is each relevant question recorded in that statement of issues, and this judgment’s answer to that question: Trade mark Infringement (1)Has Henley Constructions infringed each, or any, of Henley Arch’s registered marks (as defined in [8] of the Statement of Claim) pursuant to s 120 of the TMA? For the reasons given in the section above titled “Trade Mark Infringement” at [454]-[489], the answer to that question is: “Yes”, Henley Constructions has infringed each of the Registered Henley Arch marks (as defined in [8] of the Statement of Claim). In relation to the specific questions asked by the parties pursuant to issue 1, my answers are as follows:(a)as to the question, “has Henley Constructions used “HENLEY” as a trade mark?”. The answer to that question is: “Yes”;(b)as to the question “is “HENLEY CONSTRUCTIONS” substantially identical or deceptively similar to each of the Registered Henley Marks?”. The answer to that question is: “Yes”. (2)Was Henley Constructions’ initial use of “HENLEY CONSTRUCTIONS” and “HENLEY” a good faith use of Henley Constructions’ name pursuant to s 122(1)(a)(i) of the TMA? For the reasons given in the section above titled “Henley Constructions’ Defence – Good Faith Use of Own Name (Section 122(1)(a)(i))” at [747]-[757], the answer to that question is “No”. As a consequence, there is no need to answer whether that use has continued to be in good faith, and if not, from when. (3)Does Henley Constructions have a defence to infringement under s 122(1)(fa) of the TMA? For the reasons given in the section above titled “Henley Constructions’ Defence – Right to Register (section 122(1)(fa))” at [670]–[709], the answer to that question is “No”. (4)Was Henley Constructions’ first use of each of “HENLEY CONSTRUCTIONS” and “HENLEY” prior to the earliest of: (a) registration of any of the 2016 relevant marks (as identified in [8(d)] to [8(f)] of the Statement of Claim); or (b) Henley Arch’s first use of those marks (s 124 of the TMA)? For the reasons given in the section above titled “Henley Constructions’ Prior Use Defence” at [766]–[771], the answer to that question is “No”. ACL Contravention(5)Is Henley Constructions’ conduct in using the names “HENLEY CONSTRUCTIONS” and “HENLEY” misleading or deceptive in contravention of s 18 of the ACL and a misrepresentation contrary to ss 29(1)(g) and 29(1)(h) of the ACL? For the reasons given in the section above titled “Australian Consumer Law” at [552]-[600], the answer to that question is “Yes”. In addition, to the extent Henley Constructions’ relevant conduct occurred before the introduction of the ACL, Henley Constructions’ pre-ACL conduct contravened ss 52, 53(c) and 53(d) of the TPA. Ancillary liability of the Second Respondent (Mr Sarkis)(6)Was Mr Sarkis a joint tortfeasor with Henley Constructions in its infringement of each of the relevant marks? For the reasons given in the section above titled “Ancillary Liability of Mr Sarkis” at [981] – [986], that questions is “Yes”.(7)Did Mr Sarkis aid, abet, counsel or procure or was he directly or indirectly knowingly concerned with Henley Constructions’ contraventions of the ACL? For the reasons given in the section above titled “Ancillary Liability of Mr Sarkis” at [981] – [986], that questions is “Yes”.Relief(8)Is Henley Arch entitled to the declarations and injunctions sought against Henley Constructions and Mr Sarkis? For the reasons given in the section above titled “Relief” at [987] – [988], the answer to that question is “Yes”.(9)Is Henley Arch entitled to an account of profits from Henley Constructions in respect of profits made since notification of Henley Arch’s rights and, if so, in what amount? For the reasons stated in the section above titled “Relief” at [989], that issue is not the subject of this judgment and will be the subject of a separate hearing. Trade mark validity - distinctiveness(10)At 18 December 2006, did trade mark registration number 1152820 (“HENLEY” mark) have sufficient inherent ability to distinguish the relevant services of Henley Arch (in respect of which the “HENLEY” mark is registered) from the relevant services provided by other traders? For the reasons given in the section above titled “Cross-claim: Distinctiveness” at [824], the answer to that question is “No”. (11)If the answer to Issue 10 is “no”, to the extent that the “HENLEY” mark had, to some extent, but not sufficiently, an inherent ability to distinguish the relevant services provided by Henley Arch from the relevant services provided by other traders, had it acquired or would it acquire sufficient distinctiveness in the market place so as to be able to obtain registration under the former ss 41(5) of the TMA (as in force at 18 December 2006) or, if it had no inherent ability to distinguish the relevant services provided by Henley Arch from the relevant services provided by other traders, had it acquired such distinctiveness by that date pursuant to s 41(6)? The answer is “Yes” in light of what I have determined at [825]-[830]. (12)If the answer to Issue 11 is “no”, should the Court exercise its discretion pursuant to s 88 of the TMA not to amend or cancel the HENLEY word mark? The answer is “No” in light of what I have determined above at (11). Trade mark validity – false representations(13)Was the “HENLEY” mark accepted by the Registrar of Trade Marks on the basis of evidence or representations that were false in material particulars? For the reasons given in the section above titled "Cross-claim: Alleged False Representations to the Registrar" at [858]-[859], the answer to that question is "no" on the basis that this is a matter upon which Henley Constructions had the burden, which it has not discharged.(14)If the answer to Issue 13 is “yes”, should the Court exercise its discretion pursuant to s 88 of the TMA not to amend or cancel the “HENLEY” mark? In light of the answer to Issue 13, this issue is unnecessary to decide. The answer to that question is not relevant in light of what I have determined above at (13).Trade mark validity – non-use“HENLEY” mark(15)Is s 102(1)(b) satisfied in respect of the “HENLEY” mark registration, namely, as at the date of Henley Constructions’ cross-claim, would “HENLEY CONSTRUCTIONS” be properly registered in the name of Henley Constructions in respect of the Broad Services or the Narrow Services (to the extent there is any real difference), with the limitation that such registration cover the State of New South Wales only (applying the same questions as set out in Issue 3 above regarding the application of sections 58, 44, 42(b) and 60 of the TM Act)? If no, paragraph 4 of the Second Further Amended Statement of Cross-Claim should be dismissed. For the reasons given in the section above titled “Cross-claim: Alleged Non-Use” in relation to the “HENLEY” mark at [909]-[927], the answer to that question is “No”. (16)Is s 102(2)(b)(i) satisfied in respect of the “HENLEY” word mark registration, namely did Henley Arch use the “HENLEY” mark during the non-use period (being 7 October 2015 to 7 October 2018) in New South Wales in respect of the Broad Services and/or Narrow Services? For the reasons given in the section above this question need not be considered. (17)Should the Court apply its discretion pursuant to s 102(2) of the TMA to refuse to place either or both the geographic or services limitation on the “HENLEY” word mark registration? If yes to both, dismiss paragraph 4 of the Second Further Amended Statement of Cross-Claim. If no to either, apply appropriate limitation. For the reasons given in the section above titled “Cross-claim: Alleged Non-Use” in relation to the “HENLEY” mark at [928]-[944], I will not order that the “HENLEY” trade mark be subject to limitations by way of partial removal and I will not limit the mark to the Broad Services or Narrow Services, which I have found to be an artificial distinction.“HENLEY PROPERTIES” Device Mark(18)Is s 100(3)(a) of the TMA satisfied? In particular, did Henley Arch use the “HENLEY” mark (or a substantially identical mark) in good faith during the non-use period, being 7 October 2015 to 7 October 2018, anywhere in Australia in respect of the relevant services? For the reasons given in the section above titled “Cross-claim: Alleged Non-Use” [945]-[958], the answer to that question is “Yes”. (19)Should the Court apply its discretion pursuant to ss 101(3) and 101(4) of the TMA to refuse to remove the “HENLEY PROPERTIES” Device Mark? For the reasons given in the section above titled “Cross-claim: Alleged Non-Use” [938], the answer to that question is “Yes”. (20)Is s 102(1)(b) satisfied in respect of the “HENLEY PROPERTIES” Device Mark registration, namely, as at the date of the cross-claim, would “HENLEY CONSTRUCTIONS” properly be registered in the name of Henley Constructions in respect of the Broad Services or the Narrow Services (to the extent there is any real difference), with the limitation that such registration covers the State of New South Wales only? For the reasons given in the section above titled “Cross-claim: Alleged Non-Use” [937], the answer to that question is “No”. (21)Is s 102(2)(b)(i) satisfied in respect of the “HENLEY PROPERTIES” Device Mark registration, namely did Henley Arch use the “HENLEY PROPERTIES” Device Mark during the non-use period in New South Wales in respect of the Broad Services and/or Narrow Services? For the reasons given in the section above this question need not be considered.(22)Should the Court apply its discretion pursuant to s 102(2) of the TMA to refuse to place either or both the services or geographic limitation on the “HENLEY PROPERTIES” Device Mark registration? For the reasons given in the section above titled “Cross-claim: Alleged Non-Use” [958], no such service or geographic limitation will be imposed.