Herold v Seally (No 4)

Case [2017] FCA 957


FEDERAL COURT OF AUSTRALIA

Herold v Seally (No 4) [2017] FCA 957

File number: NSD 2139 of 2016
Judge: BROMWICH J
Date of judgment: 18 August 2017
Catchwords: PRACTICE AND PROCEDURE – application for leave to file an amended statement of claim
Legislation:

Competition and Consumer Act 2010 (Cth), Sch 2, Australian Consumer Law

Copyright Act 1968 (Cth), s 35

Cases cited: Herold v Seally(No 2) [2017] FCA 543
Date of hearing: Determined on the papers
Date of last submissions: 14 July 2017
Registry: New South Wales
Division: General Division
National Practice Area: Intellectual Property
Sub-area: Trade Marks
Category: Catchwords
Number of paragraphs: 14
Counsel for the Applicants: Mr M Hall SC
Solicitor for the Applicants: James Beatty & Associates
Counsel for the Respondents: Mr T Di Francesco
Solicitor for the Respondents: Phillips Ormonde Fitzpatrick Lawyers

ORDERS

NSD 2139 of 2016
BETWEEN:

LARS HEROLD

First Applicant

GREEN LIGHT GROUP PTE LTD (SINGAPORE COMPANY REGISTRATION NO 20121505Z)

Second Applicant

AND:

JONATHON SEALLY

First Respondent

PODWAY LTD

Second Respondent

JUDGE:

BROMWICH J

DATE OF ORDER:

18 AUGUST 2017

THE COURT ORDERS THAT:

1.The applicants be granted leave to file an amended statement of claim in the form provided by email to the associate to Justice Bromwich on 9 August 2017.

2.The respondents pay the applicants’ costs of and incidental to the application for leave to file the amended statement of claim.

Note:    Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules 2011.


REASONS FOR JUDGMENT

BROMWICH J:

  1. This is a dispute about pleadings following my judgment in Herold v Seally(No 2) [2017] FCA 543, by which I refused both the applicants’ bid for an anti-suit injunction of proceedings in the Superior Court of California and the respondents’ bid for complete or partial setting aside of these proceedings. As outlined in those prior reasons, the parties to these proceedings are involved in a highly polarised dispute as to who should take the dominant credit for the development of a particular concept for driverless vehicles, and thereby be able to develop the concept commercially, principally overseas.

  2. To the above overview may be added my general understanding of certain aspects of the case.  Reflecting no determination or agreement as to fact, it seems on the pleadings so far that there is a live dispute between the parties as to who owns the intellectual property to use, permit the use of, or restrain the use of, a set of PowerPoint slides and Excel spreadsheets in the form of slides, by which the driverless vehicles concept was described.  The two types of slides were apparently assembled as a single document, referred to by the parties as the “deck”.  It seems that a subset of that deck was then created using a selection of the slides to create a “pitch deck”, principally for the purposes of persuading potential investors to commit funds to the development of the concept. 

  3. The question of who was responsible for…

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AGLC
Herold v Seally (No 4) [2017] FCA 957
Case
[2017] FCA 957
Decision Date

CaseChat Overview and Summary

The applicants, Herold and another, sought leave to file an amended statement of claim against the respondents, Seally and another, in a proceeding that had already been initiated. The matter came before the Federal Court and was presided over by Justice Bromwich. The applicants sought to amend their statement of claim to include new allegations of misleading or deceptive conduct by the respondents. The respondents objected to the proposed amendments, arguing that the applicants' pleadings were fatally defective.

The court was required to determine whether the applicants' proposed pleadings contained sufficient details to justify an amendment to the statement of claim. The respondents argued that the applicants' pleadings did not adequately set out the alleged misleading or deceptive conduct. The applicants, on the other hand, argued that the proposed pleadings were sufficient to establish a cause of action against the respondents. The court had to balance the need for adequate pleading with the principles of fairness and justice that underpin the legal system.

The court held that the applicants' proposed pleadings, while perhaps not ideal in form, did not suffer from the fatal defects asserted by the respondents. The court found that it was sufficient for the pleading to state what was said or done, and why it is alleged to be misleading or deceptive and in trade or commerce. The court held that the applicants were entitled to proceed with their proposed amended statement of claim and should therefore have leave to file it within seven days. The court also held that the respondents must pay the applicants' costs of the application for leave to file the amended statement of claim.

The court granted the applicants leave to file an amended statement of claim in the form provided by email to the associate to Justice Bromwich on 9 August 2017. The court also ordered that the respondents pay the applicants' costs of and incidental to the application for leave to file the amended statement of claim.

Orders

Orders of the court

1. The applicants be granted leave to file an amended statement of claim in the form provided by email to the associate to Justice Bromwich on 9 August 2017.

2. The respondents pay the applicants’ costs of and incidental to the application for leave to file the amended statement of claim.

Note: Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules 2011.

Background

Background to the litigation

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Evidence

Evidence Before The Court

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Decision

Reasons for decision

After carefully reading the proposed pleadings and, in particular, those objected to in the context of the balance, I am of the view that, while perhaps not ideal in form, the pleadings upon which the applicants seek to rely do not suffer from the fatal defects asserted by the respondents. When an allegation of misleading or deceptive conduct is sought to be pleaded, the moving party does not have to go so far as to plead a contrary, alternative position, as though relief to that end were being sought. In the present case, the impugned parts of the applicants’ proposed pleading attack what the first respondent is said to have represented was the legal and factual position, and only seek to plead to the contrary to the extent of showing that this is not so. In those circumstances, it is sufficient for the pleading to state what was said or done, and why it is alleged to be misleading or deceptive and in trade or commerce. That may then be responded to in the usual way. Without making premature determinations of fact or law, the applicants proposed pleading goes far enough in all the circumstances. If, in the final analysis, the proven facts do not rise to the level pleaded, then the claim will fail.Conclusion The applicants are entitled to proceed with their proposed amended statement of claim and should therefore have leave to file it within seven days. I would expect that any further minor amendments required should be able to be accommodated by sensible discussion so as to fall within the leave that will be granted.Costs There is no reason why costs should not follow the event. The respondents must therefore pay the applicants’ costs of this application.

Ratio Decidendi

Legal Principle Established

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