Killer Queen, LLC v Taylor
[2024] FCAFC 149
•22 November 2024
FEDERAL COURT OF AUSTRALIA
Killer Queen, LLC v Taylor [2024] FCAFC 149
Appeal from: Taylor v Killer Queen, LLC (No 5) [2023] FCA 364 File number: NSD 547 of 2023 Judgment of: YATES, BURLEY AND ROFE JJ Date of judgment: 22 November 2024 Catchwords: TRADE MARKS – infringement of registered trade mark established – where registered trade mark is a name – joint tortfeasance – principles discussed
TRADE MARKS – specification of registered goods – meaning of “clothes” – role of the Nice Agreement Concerning the International Classification of Goods and Services for the Purposes of the Registration of Marks as an aid to construction
TRADE MARKS – defence to infringement – where infringing mark is a name mark – own name defence – whether joint tortfeasor who does not use the infringing mark can rely on the defence – whether defence applies to the use of an adopted name – where person relying on defence has assigned the name mark – whether assignor can rely on continuing use of own name as a defence
TRADE MARKS – defence to infringement – where infringing mark is deceptively similar to the registered mark – whether person using the infringing mark would obtain registration – honest concurrent use – whether concurrent use established – whether honest use established
TRADE MARKS – cancellation – whether, because of reputation in prior mark, use of the registered mark would be likely to deceive or cause confusion – where ground of cancellation established – whether discretion should be exercised not to cancel the registration of the registered mark
TRADE MARKS – cancellation – whether, because of circumstances applying at the time when the application for rectification is filed, the use of the registered mark is likely to deceive or cause confusion – where ground of cancellation is established – whether discretion should be exercised not to cancel the registration of the registered mark
Legislation: Competition and Consumer Act 2010 (Cth) Schedule 2, s 18
Judiciary Act 1903 (Cth) s 79
Patents Act1990 (Cth) s 120(4)
Trade Marks Act 1955 (Cth) s 64(1)(a)
Trade Marks Act 1995 (Cth) ss 10, 19, 19(3), 20, 20(1), 20(2), 20(3), 27(3)(b), 42, 44(3), 58, 60, 88(1), 88(1)(a), 88(2), 88(2)(a), 88(2)(c), 89, 89(1), 89(1)(b), 120, 120(2), 122, 122(1)(a), 122(1)(f), 122(1)(fa), 124, 126(2), 207(2), 209, 210(1)
Trade Marks Amendment Act 2006 (Cth)
Trade Practices Act1974 (Cth) s 52
Trade Marks Regulations 1995 (Cth) regs 3.1, 4.4, 8.2
Births, Deaths and Marriages Registration Act 1995 (NSW) s 27
Limitation Act1969 (NSW) ss 14(1), 23
Trade Marks Act 1938 (UK) s 8(a)
Cases cited: Accor Australia & New Zealand Hospitality Pty Ltd v Liv Pty Ltd [2017] FCAFC 56; 345 ALR 205
Anchorage Capital Master Offshore Ltd v Sparkes [2023] NSWCA 88; 11 NSWLR 304
Anchorage Capital Partners Pty Ltd v ACPA Pty Ltd [2018] FCAFC 6; 259 FCR 514
Anheuser-Busch v Budějovický Budvar, Národní Podnik [2002] FCA 390; 56 IPR 182
Aristocrat TechnologiesAustralia Pty Ltd v Global Gaming Supplies Pty Ltd [2016] FCAFC 22; 329 ALR 522
Australian Securities and Investments Commission v Hellicar [2012] HCA 17; 247 CLR 345
Bauer Consumer Media Ltd v Evergreen Television Pty Ltd [2019] FCAFC 71; 367 ALR 393
Baume & Co Ltd v A H Moore Ltd [1958] Ch 907; 2 WLR 797, Ch D
Baxter v Obacelo Pty Limited [2001] HCA 66; 205 CLR 635
Blatch v Archer (1774) 1 Cowp 63; 98 ER 969
Bob Jane Corporation Pty Ltd v ACN 149 801 141 Pty Ltd [2013] FCA 1255; 97 ACSR 127
Cantarella Bros Pty Ltd v Lavazza Australia Pty Lt (No 3) [2023] FCA 1258
Coulton v Holcombe [1986] HCA 33; 162 CLR 1
Décor Corporation v Dart Industries [1988] FCA 682; 13 IPR 385
Delfi Chocolate Manufacturing S.A. v Mars Australia Pty Ltd [2015] FCA 1065; 115 IPR 82
Dunlop Aircraft Tyres Ltd v Goodyear Tire & Rubber Company [2018] FCA 1014; 262 FCR 76
Energy Beverages LLC v Cantarella Bros Pty Ltd [2023] FCAFC 44; 407 ALR 473
Fine & Country Ltd v Okotoks Ltd [2012] EWHC 2230 (Ch); 7 WLUK 991
Flexopack SA Plastics Industry v Flexopack Australia Pty Ltd [2016] FCA 235; 118 IPR 239
GAIN Capital UK Ltd v Citigroup Inc (No 4) [2017] FCA 519; 123 IPR 234
General Electric Co Ltd (USA) v General Electric Co Ltd “GE Trade Mark” [1972] 1 WLR 729, HL(E)
Goodman Fielder Pte Ltd v Conga Foods Pty Ltd [2020] FCA 1808; 158 IPR 9
Harcourts WA Pty Ltd v Roy Weston Nominees Pty Ltd (No 4) [2016] FCA 138; 116 IPR 269
Hashtag Burgers Pty Ltd v In-N-Out Burgers, Inc [2020] FCAFC 235; 385 ALR 514
Health World Ltd v Shin-Sun Australia Pty Ltd [2010] HCA 13; 240 CLR 590
Hills Industries Ltd v Bitek Pty Ltd [2011] FCA 94; 214 FCR 396
Hotel Cipriani SRL v Cipriani (Grosvenor Street) Ltd [2010] EWCA Civ 110; Bus LR 1465
HTX International Pty Ltd v Semco Pty Ltd [1983] FCA 225; 49 ALR 636
Johnson & Johnson Aust Pty Ltd v Sterling Pharmaceuticals Pty Ltd [1991] FCA 402; 30 FCR 326
JR Consulting & Drafting Pty Ltd v Cummings [2016] FCAFC 20; 329 ALR 625
Keller v LED Technologies Pty Ltd [2010] FCAFC 55; 185 FCR 449
Marino v Bello (No 3) [2022] NSWCA 181; 408 ALR 650
Mars Australia Pty Ltd v Sweet Rewards Pty Ltd [2009] FCA 606; 81 IPR 354
McCormick & Co Inc v McCormick [2000] FCA 1335; 51 IPR 102
McD Asia Pacific LLC v Hungry Jack’s Pty Ltd [2023] FCA 1412; 175 IPR 397
Mercury Communications Limited v Mercury Interactive (UK) Limited [1995] FSR 850
Nikken Wellness Pty Ltd v van Voorst [2003] FCA 816; AIPC ¶91–104
Optical 88 Ltd v Optical 88 Pty Ltd (No 2) [2010] FCA 1380; 275 ALR 526
Parker-Knoll Ltd v Knoll International Ltd (No 2) [1962] RPC 265
PDP Capital Pty Ltd v Grasshopper Ventures Pty Ltd [2021] FCAFC 128; 285 FCR 598
Qantas Airways Limited v Edwards [2016] FCA 729; 338 ALR 134
Re Australian Wine Importers Ltd (1889) 41 Ch D 278
Re Parkington & Co (1946) 63 RPC 171
Reckitt & Coleman (Australia) Ltd v Boden [1945] HCA 12; 70 CLR 84
Reliance Water Controls Ltd v Altecnic Ltd [2001] EWCA Civ 1928; 12 WLUK 261
Rodney Jane Racing Pty Ltd v Monster Energy Company [2019] FCA 923; 370 ALR 140
SAP Australia Pty Ltd v Sapient Australia Pty Ltd [1999] FCA 1027; 45 IPR 169
Self Care IP Holdings Pty Ltd v Allergan Australia Pty Ltd [2023] HCA 8; 277 CLR 186
Sensis Pty Ltd v Senses Direct Mail and Fulfillment Pty Ltd [2019] FCA 719; 141 IPR 463
Singtel Optus Pty Ltd v Optum Inc [2018] FCA 575; 140 IPR 1
Smith & Nephew Plastics (Australia) Pty Ltd v Sweetheart Holding Corporation (1987) 8 IPR 285
Southern Cross Refrigerating Company v Toowoomba Foundry Pty Ltd [1954] HCA 82; (1953) 91 CLR 592
Sterling Pharmaceuticals Pty Ltd v Johnson & Johnson Australia Pty Ltd [1990] FCA 278; 96 ALR 277
Taylor v Killer Queen, LLC(No 5) [2023] FCA 364; 172 IPR 1
The Koursk [1924] LRP 140; 18 Lloyd’s Rep 153
Thompson v Australian Capital Television Pty Ltd [1996] HCA 38; 186 CLR 574
Trident Seafoods Corporation v Trident Foods Pty Ltd [2018] FCA 1490; 137 IPR 65
Woolworths Limited v BP plc (No 2) [2006] FCAFC 132; 154 FCR 97
Division: General Division Registry: New South Wales National Practice Area: Intellectual Property Sub-area: Trade Marks Number of paragraphs: 355 Date of hearing: 22 – 23 February 2024 Counsel for the Appellants and Cross-Respondents: Mr M Darke SC with Ms E Bathurst Solicitor for the Appellants and Cross-Respondents: Corrs Chambers Westgarth Counsel for the Respondent and Cross-Appellant: Mr C Dimitriadis SC with Mr R Clark Solicitor for the Respondent and Cross-Appellant: Silberstein & Associates ORDERS
NSD 547 of 2023 BETWEEN: KILLER QUEEN, LLC
First Appellant
KATHERYN ELIZABETH HUDSON
Second Appellant
KITTY PURRY, INC (and another named in the Schedule)
Third Appellant
AND: KATIE JANE TAYLOR
Respondent
AND BETWEEN: KATIE JANE TAYLOR
Cross-Appellant
AND: KILLER QUEEN, LLC (and others named in the Schedule)
First Cross-Respondent
ORDER MADE BY:
YATES, BURLEY AND ROFE JJ
DATE OF ORDER:
22 NOVEMBER 2024
THE COURT ORDERS THAT:
1.The appeal be allowed in part.
2.The cross-appeal be allowed in part.
3.Orders 1 to 5 made on 10 May 2023, and Order 1 made on 4 August 2023, in proceeding number NSD 1774 of 2019 (the proceeding below) be set aside.
4.The originating application in the proceeding below be dismissed.
5.The cross-claim in the proceeding below be allowed.
6.The Register of Trade Marks be rectified by cancelling the registration of trade mark no. 1264671.
7.The respondent pay the appellants’ costs of the appeal and cross-appeal.
8.The question of the costs of the proceeding below be remitted to the primary judge for re-determination in light of the findings made on appeal.
9.Order 6 of these orders be stayed until the later of:
(a)the determination of any application for special leave to appeal to the High Court; and
(b)if special leave to appeal is sought and granted, the determination of any appeal to the High Court.
Note: Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules 2011.
REASONS FOR JUDGMENT
1 INTRODUCTION
[1]
2 BACKGROUND FINDINGS OF THE PRIMARY JUDGE
[7]
2.1 Ms Taylor and her business
[8]
2.2 Ms Hudson and her business
[11]
2.3 Licensing arrangements and the infringing conduct
[25]
3 THE “CLOTHES” ISSUE (Cross-appeal grounds 6, 7)
[43]
3.1 Introduction
[43]
3.2 The primary judge’s findings on the goods of the “clothes” issue
[45]
3.3 Consideration
[49]
4 THE JOINT TORTFEASOR ISSUE (Cross-appeal grounds 1 – 5)
[62]
4.1 Introduction
[62]
4.1.1 First Channel – Prismatic Tour and Witness Tour
[70]
4.1.1.1 Prismatic Tour
[71]
4.1.1.2 Witness Tour
[81]
4.1.2 Second Channel – Pop-up Stores
[85]
4.1.3 Third Channel – Target Stores
[86]
4.1.4 Fifth Channel – Harris Scarfe and Best & Less
[90]
4.1.5 Sixth Channel – Websites
[94]
4.2 Relevant principles of joint tortfeasorship
[99]
4.3 Consideration
[107]
4.3.1 Bravado
[108]
4.3.2 Blackout Merch
[122]
4.3.3 Epic Rights
[129]
5 INTRODUCTION TO THE DEFENCES AND PRIMARY JUDGE’S FINDINGS
[132]
5.1 Use in “good faith”, honest concurrent use and use of own name defences
[133]
5.1.1 Legislation
[136]
5.2 Primary judge’s findings on “good faith”, honest concurrent use and use of own name defences
[138]
5.2.1 Use of own name in “good faith”
[138]
5.2.2 Honest concurrent use
[146]
5.2.3 Use of own name
[154]
6 USE IN GOOD FAITH (Cross-appeal grounds 10 and 11)
[156]
6.1 Introduction
[156]
6.2 Consideration
[162]
6.2.1 Meaning of “good faith”
[162]
6.2.2 Use in good faith in the circumstances
[168]
7 HONEST CONCURRENT USE DEFENCE (Appeal ground 2)
[176]
7.1 Introduction
[176]
7.2 Application to amend the Further Amended Notice of Appeal
[180]
7.3 Consideration
[189]
7.4 Would the appellants obtain registration of the Katy Perry Mark for clothes (s 122(1)(fa))?
[193]
8 USE OF OWN NAME (Appeal ground 1 and cross-appeal grounds 8 and 9)
[218]
8.1 Introduction
[218]
8.2 Consideration
[232]
9 CANCELLATION OF THE KATIE PERRY MARK (Appeal grounds 3 and 4)
[253]
9.1 Primary judge’s reasons
[254]
9.1.1 Section 88(1)(a) pursuant to s 60 (ground 3)
[254]
9.1.2 Section 88(2)(c) (ground 4)
[259]
9.2 The submissions – s 88(2)(a) pursuant to s 60 (Appeal ground 3)
[266]
9.3 Consideration of ground 3
[271]
9.3.1 Discretion not to cancel for ground 3
[303]
9.4 The submissions – circumstances applying at time of application for rectification pursuant to s 88(2)(c) (Appeal ground 4)
[324]
9.5 Consideration
[331]
9.5.1 Discretion not to cancel for ground 4
[340]
10 RELIEF (Appeal grounds 5, 6 and 7)
[345]
11 APPROPRIATE FORM OF ORDERS/DISPOSITION
[352]
SCHEDULE OF PARTIES
THE COURT:
1. INTRODUCTION
This is an appeal brought by the United States of America (US) music artist and performer known as Katy Perry, whose real name is Katheryn Hudson, and her associated companies Killer Queen, LLC, Kitty Purry, Inc and Purrfect Ventures, LLC (together the appellants), from the decision of the primary judge in Taylor v Killer Queen, LLC(No 5) [2023] FCA 364; 172 IPR 1 (PJ or Primary Judgment). In the primary judgment, Ms Hudson and Kitty Purry were found to have infringed the respondent’s trade mark no. 1264761 for the words KATIE PERRY, and were ordered to pay additional damages. Killer Queen and Purrfect Ventures were not found to be liable. The appellants were unsuccessful in their attempt to cancel the trade mark registration for KATIE PERRY.
The appellants appeal from the aspects of the decision that are adverse to their interests. In turn, the respondent, Katie Taylor, cross-appeals in relation to the primary judge’s findings on her claims that Killer Queen and Purrfect Ventures are liable as joint tortfeasors, the scope of the registered goods and the appellants’ defences to trade mark infringement.
The KATIE PERRY Mark (trade mark no. 1264761, which we also refer to as Ms Taylor’s Mark) is registered in class 25 and has a priority date of 29 September 2008. It is relevant to note that Ms Hudson sought registration for her mark, KATY PERRY (trade mark no. 1306481) (Katy Perry Mark), on 26 June 2009 in class 25, but subsequently withdrew that application, registering the mark only in classes 9 and 41.
The primary judge gave extensive reasons, not least because the parties chose to put every conceivably arguable factual and legal contention into issue. Their approach to the appeal was no different. It is convenient to identify the issues raised in the grounds of appeal, notice of contention, and cross-appeal by reference to the challenged findings of the primary judge.
In her reasons, the primary judge:
(1)determined that the alleged acts of infringement do not fall within the scope of the registration of the KATIE PERRY Mark because the impugned trade mark use was not in respect of goods that fall within the meaning of the word “clothes”, with the exception of “party costumes” (PJ at [339]–[340], [346], [347]). In grounds 6 and 7 of her cross‑appeal Ms Taylor challenges these findings in relation to footwear, headgear, caps, hats and headbands. We address this in section 3 below.
(2)found that Ms Hudson infringed Ms Taylor’s Mark in five separate instances in various tweets, a Facebook post and a Facebook page event (PJ at [583(1)]) and that Kitty Purry was liable as a joint tortfeasor in respect of certain acts of primary infringement by Bravado (a term used by the primary judge at PJ [85] to refer to Bravado International Group Inc., Bravado International Group Merchandising Services, Inc (Bravado Merchandising) and any related entities) for promoting and selling clothes, or goods of the same description to clothes (PJ at [583(2)]). The primary judge rejected Ms Taylor’s claim that Killer Queen and Ms Hudson were liable for trade mark infringement as joint tortfeasors (PJ at [390]). In her cross-appeal, Ms Taylor contends that the primary judge erred in finding that Killer Queen and Ms Hudson, and Kitty Purry in relation to some trade channels, were not joint tortfeasors in relation to conduct of Bravado (grounds 1, 2 and 2A). Ms Taylor also contends that the primary judge erred in finding that none of the appellants was a joint tortfeasor in relation to the conduct of a company identified as Blackout Merch (ground 3) and that Killer Queen, Ms Hudson and Kitty Purry were not joint tortfeasors in relation to the conduct of Epic Rights LLC (grounds 4 and 5). We address these grounds in section 4 below.
(3)found that a defence based on s 122(1)(a) of the Trade Marks Act 1995 (Cth) (good faith use of own name or name of predecessor in business) was not available to the appellants, with the exception of Ms Hudson, who could rely on the defence and was found to fall within its scope (PJ at [626], [633], [639], [648], [667], [705]). In ground 1 of the appeal, the appellants challenge the finding that the defence does not apply to Kitty Purry. In grounds 8–11 of the cross-appeal and ground 1 of her Notice of Contention Ms Taylor challenges the primary judge’s conclusions concerning this defence insofar as they concern Ms Hudson, Kitty Purry, Killer Queen and Purrfect Ventures. We address these matters in section 6 below.
(4)rejected a defence based on s 122(1)(fa) of the Trade Marks Act (alleged infringer would obtain registration of a substantially identical or deceptively similar mark) on the basis that Ms Hudson would not have obtained registration of a trade mark for the words “KATY PERRY” in class 25, pursuant to s 44(3) of the Trade Marks Act for honest concurrent use (PJ at [699], [703]). The appellants challenge this conclusion in ground 2 of the appeal. At the conclusion of their oral submissions in reply, the appellants sought to amend ground 2 to plead an earlier date of first user. This was opposed by Ms Taylor. We address these matters in section 7 below.
(5)rejected a contention advanced by the appellants in their cross-claim that Ms Taylor’s Mark was liable to be cancelled under s 60 of the Trade Marks Act (likelihood of deception or confusion because a prior trade mark has acquired a reputation in Australia) (PJ at [753]). The appellants challenge this conclusion in ground 3 of the appeal. Ms Taylor contends in para 2 of her Notice of Contention that, if this ground is upheld, the Court should decline to exercise its discretion under s 88(1)(a) or s 89(1) of the Trade Marks Act to cancel Ms Taylor’s Mark. We address these matters in section 9 below.
(6)rejected a contention advanced by the appellants in their cross-claim that Ms Taylor’s Mark was liable to be cancelled under s 42 of the Trade Marks Act (trade mark use contrary to law, by reason of a breach of s 52 of the Trade Practices Act1974 (Cth) or s 18 of the Australian Consumer Law (ACL) (Schedule 2 of the Competition and Consumer Act 2010 (Cth)) (PJ at [758]). This ground is not challenged on appeal.
(7)rejected a contention advanced by the appellants in their cross-claim that Ms Taylor’s Mark was liable to be cancelled under s 43 (trade mark use likely to deceive or cause confusion because of a connotation) (PJ at [773]). This ground is not challenged on appeal.
(8)found that Ms Taylor’s Mark was not liable to be cancelled under s 88(2)(c) (because, as at the date of the cross-claim, the use of Ms Taylor’s Mark was not likely to deceive or cause confusion) (PJ at [795]). The appellants challenge this conclusion in ground 4 of the appeal. Ms Taylor contends in paras 3 and 4 of her Notice of Contention that if this ground of appeal is upheld, the Court should decline to exercise its discretion under either s 88(1)(a) or s 89(1) of the Trade Marks Act to cancel Ms Taylor’s Mark. We address these matters in section 9 below.
(9)rejected a contention advanced by the appellants that Ms Taylor was not entitled to relief because of laches (PJ at [823]). The appellants challenge this conclusion in ground 5 of the appeal. We address this ground in section 10 below.
(10)determined that Ms Taylor was entitled to additional damages pursuant to s 126(2) of the Trade Marks Act (PJ at [851]). The appellants challenge this conclusion in ground 6 of the appeal. We address this ground in section 10 below.
(11)ordered that Kitty Purry be permanently restrained from infringing the KATIE PERRY Mark including by engaging in manufacturing, promoting or selling any clothes bearing the Katy Perry Mark (orders of Markovic J, made 10 May 2023). The appellants challenge this order in ground 7 of the appeal. We address this ground in section 10 below.
We first address matters going to the liability of the appellants for infringement and joint tortfeasorship before turning to the statutory defences raised and then laches, damages and the form of orders. For the reasons set out in more detail below we have found that the primary judge erred in her conclusion that the KATIE PERRY Mark should remain on the Register of Trade Marks. The consequence is that grounds 3 and 4 of the appeal succeed and the decision below must be reversed.
2. BACKGROUND FINDINGS OF THE PRIMARY JUDGE
The background of how Ms Taylor and Ms Hudson each came to be known by, and to use, the same name in their respective commercial activities, albeit with different spelling, and the events leading to the dispute the subject of the trial are comprehensively set out by the primary judge, commencing at [8] in the primary judgment. In this section we gratefully draw upon the primary judge’s thorough findings of fact.
2.1 Ms Taylor and her business
Ms Taylor was born Katie Jane Perry and has gone by three different names: Katie Perry, Katie Howell, and Katie Taylor. She worked in retail and in the fashion industry and started her own label in early 2007 initially using a different name for her label, before settling on the brand name “KATIE PERRY”.
On 2 May 2007, Ms Taylor registered a domain name for her business at On 13 September 2007, she applied to register a trade mark for a fancy logo, the prominent feature of the logo was the words “KATIE PERRY” in cursive font. This application subsequently lapsed and on 29 September 2008, she applied for registration of the KATIE PERRY Mark.
Ms Taylor sold her products via an online store, through wholesalers and also from a showroom. The clothing Ms Taylor produced was “luxury loungewear”, including items such as jogger style pants and t-shirts.
2.2 Ms Hudson and her business
Evidence on behalf of the respondents was given by Steven Jensen, a partner of Direct Management Group Inc (DMG), a talent management agency which at all material times managed Ms Hudson’s career. Mr Jensen together with his two business partners, took steps to plan for and implement the development of Ms Hudson’s career as a musical artist, including her brand affiliations and touring. He kept in regular and frequent contact with Ms Hudson and kept her informed of the actions DMG took for her benefit. From about April 2007, when Ms Hudson changed her record company to Virgin, her musical career became particularly active, with Mr Jensen being closely involved in the promotion of Ms Hudson as a solo artist, her music and planning for commercial opportunities.
From at least early 2008, Mr Jensen considered that Australia was going to be an important market for Ms Hudson’s career. He and others involved in the development and management of her career planned for her to undertake a number of promotional and performance activities before a worldwide concert tour scheduled for 2009.
One of these performances was the “Warped Tour”, a US rock music tour that Ms Hudson was invited to perform at, which commenced on 30 June 2008 and ended on 17 August 2008. In anticipation of that tour, Mr Jensen pursued various merchandising opportunities and also caused an application to be filed for the “KATY PERRY” word mark in the US, including for apparel in class 25. DMG also arranged for a range of “Katy Perry” branded merchandise to be designed and produced for that tour. At each concert during the tour official merchandise was available for sale to fans.
By July 2008, in anticipation of her worldwide tour, Mr Jensen considered that there was a significant commercial opportunity for sales, including online sales, of “Katy Perry” branded merchandise. Mr Jensen commenced planning and carrying out various activities to take advantage of that opportunity in all countries where Ms Hudson was popular, including Australia. To that end, he engaged in discussions with Tom Donnell of Bravado International Group Inc, a merchandise company that operated in the music industry. Mr Jensen had worked with Bravado and Mr Donnell for 15 years and was aware that Bravado provided branded merchandise to distributors for resupply to retailers. Mr Jensen introduced Mr Donnell and his colleagues at Bravado to Ms Hudson, including those involved in the design of products in about 2008 or 2009. Ms Hudson accepted Mr Jensen’s recommendation that they work with Bravado in relation to physical retail distribution and also online sales. From August 2008, Mr Donnell provided Mr Jensen and others with proposed designs for sale and when they were approved, they were promoted.
The primary judge records that it was not in dispute that Ms Hudson was “closely involved in the selection and approval of designs and items of merchandise to be offered for sale generally and in particular geographic regions”.
On 24 September 2008, Mr Donnell informed Mr Jensen by email that the “Katy Perry web store” was live and ready to be linked to Ms Hudson’s homepage. Mr Jensen understood that this meant that “Katy Perry” branded merchandise, including clothing, would be advertised and available for purchase from Bravado either online or by telephone order, including in Australia. A few days after the webstore went live on the Bravado Website at katyperry.shop.bravadousa.com, it went live on Ms Hudson’s own website too.
In November 2008, Mr Donnell provided DMG with a confidential proposal for the distribution and sale worldwide for Ms Hudson’s upcoming world tour (2008 Proposal). No formal contract was entered into until 2011. However, the terms of that proposal were treated by DMG and Bravado as binding.
In about May 2009, Mr Jensen became aware of Ms Taylor’s application for registration of the KATIE PERRY Mark for “clothes” in Australia. He was concerned that Ms Taylor’s purpose was to obtain financial advantage from Ms Hudson, who at that time was scheduled to tour Australia as part of her worldwide tour, in August 2009. He authorised his US based lawyers to send a cease and desist letter to Ms Taylor in an attempt to stop the registration of the KATIE PERRY Mark.
The primary judge recites a subsequent email dated 16 June 2009 from Mr Jensen to Ms Hudson in which he informs her that Ms Taylor had traded under the name, Katie Perry, since 2007. He incorrectly informed Ms Hudson that no attempt had been made to keep Ms Taylor from trading under that name, refers to the tabloid newspapers picking up the story, and advises her that he will keep her posted. Ms Hudson responded on 17 June 2009 with comments suggestive that she had a distinct understanding of the dispute:
I say keep me outta it entirely... Make it less important but release something from management, pretty much stating the facts. Like from the opening of this email, beside the Katy, to the ‘story’ part. Those exact words are great. Don’t soften it up, don’t apologize, nothing. Let me know what’s going out before it does pls...
Stupid bitches.
I wouldn’t have even bothered with this mtv hadn’t picked up this silliness.
Dumb bitch! Rawr!
Ms Hudson’s lawyers were then authorised to attempt to resolve the matter on a mutually satisfactory co-existence arrangement.
On 26 June 2009, Ms Hudson lodged an application for registration of “KATY PERRY” as a trade mark in classes 9, 25 and 41. Ms Hudson also lodged an application with IP Australia for an extension of time within which to bring an opposition to Ms Taylor’s Mark. The application was listed for hearing in July 2009, but on 16 July 2009 that opposition was withdrawn before it was heard. The primary judge records that, at about that time, Mr Jensen had formed the view that Ms Hudson’s interests were best served by avoiding further publicity relating to Ms Taylor and that the appropriate way forward was not to appear at the hearing, recognising that Ms Taylor would be granted her trade mark application and could complain about trade mark infringement by Ms Hudson at a future point in time if the Katy Perry Mark was used on clothes. The primary judge also records that Mr Jensen was not concerned by this because he did not consider there to be any likelihood that members of the public would confuse clothing and other merchandise bearing the Katy Perry name on it with Ms Taylor’s clothes. However, Mr Jensen accepted that the strategy he adopted involved Ms Hudson taking a calculated risk of trade mark infringement.
From 29 June 2009 until August 2009, Ms Hudson and Ms Taylor engaged in negotiations via their lawyers in an attempt to make arrangements for their trade marks to co-exist. During that time, Mr Jensen kept Ms Hudson informed of his views of the matter and the actions that he proposed to take and Ms Hudson approved of those actions.
On 21 July 2009, Ms Taylor’s Mark was entered on the Register of Trade Marks.
Ms Hudson toured Australia in August 2009 as part of a world concert tour, “The Katy Perry: The Hello Katy Tour”. Mr Jensen was not aware of any contact on behalf of Ms Taylor with Ms Hudson’s lawyers at the time, which led him to believe that there was no real likelihood of subsequent contact. He expressed the opinion that based on his experience, it would have been detrimental to Ms Hudson’s success and popularity if she could not use her name Katy Perry in connection with branded clothing merchandise in a market as important to her music career as Australia.
2.3 Licensing arrangements and the infringing conduct
It is relevant to the consideration of the challenges to the primary judge’s findings of joint tortfeasorship in grounds 1 to 5 of Ms Taylor’s cross-appeal to set out in some detail the licensing arrangements affecting Ms Hudson’s interests.
Kitty Purry was incorporated on 23 April 2008 in California. Ms Hudson is its sole director, chief executive officer (CEO), secretary, chief financial officer (CFO) and shareholder.
Killer Queen was incorporated on 27 August 2009 in California with Ms Hudson as its sole shareholder and director.
Purrfect Ventures was incorporated on 7 September 2016 in Delaware. Its initial members were Killer Queen and GBG USA Inc.
In 2021 Hudson Fund, LLC, a company incorporated in 2016 with Ms Hudson as its sole member, acquired GBG’s shares in Purrfect Ventures.
The primary judge records that on 10 February 2011, following the release of Ms Hudson’s album “Teenage Dream” and in anticipation of “Katy Perry: The California Dreams Tour”, another world concert tour, Kitty Purry as grantor entered into an agreement with Bravado Merchandising in relation to the sale of “Katy Perry” branded merchandise, including during the California Dreams Tour, and the grant of licence rights in relation to the Katy Perry Mark (2011 Bravado Agreement). The 2011 Bravado Agreement was signed by Ms Hudson as an authorised representative of Kitty Purry. Merchandise bearing the Katy Perry Mark was sold by Bravado Merchandising on the Australian leg of the tour.
Mr Jensen discussed the terms of the 2011 Bravado Agreement with Ms Hudson and recommended that she and Kitty Purry enter into it. He believed that it “gave Ms Hudson a significant commercial opportunity in relation to Katy Perry branded merchandise to be offered in connection with her musical activities, including by its offer for sale and sale at concert venues and via e-commerce”.
On 16 December 2011, Ms Hudson and Killer Queen entered into a deed of assignment pursuant to which Ms Hudson assigned to Killer Queen all of her rights and interests to various identified trade marks.
Ms Hudson released a number of successful singles and engaged in numerous performances in 2012 and 2013.
The acts of infringement pleaded concern those that took place after 24 October 2013, being, as the primary judge records, the earliest that the limitation period permitted.
In February 2014, following the successful release of her fourth studio album “Prism”, and in anticipation of Ms Hudson’s global “Prismatic Tour”, Kitty Purry as grantor entered into an agreement with Bravado Merchandising in relation to the sale of “Katy Perry” branded merchandise including the grant of licence rights in relation to the Katy Perry Mark (2014 Bravado Agreement). It was signed by Ms Hudson as an authorised representative of Kitty Purry.
During the Prismatic Tour, merchandise bearing the Katy Perry Mark was sold at pop-up stores in Australia.
The primary judge refers to two agreements entered on 16 September 2016 which she defines as the Purrfect Ventures Agreements. In the first agreement, Killer Queen granted an exclusive, non-transferrable worldwide licence to Purrfect Ventures, with the right to sub-license and to use the “Katy Perry brand” in connection with the development, design, manufacture, promotion and sale of certain approved products through certain permitted channels of distribution. In the second agreement, Killer Queen, Purrfect Ventures and GBG entered into a contract for the global licencing of the “Katy Perry” brand as a fashion brand in relation to certain product categories including, relevantly, shoes (PJ at [231]).
On 1 December 2017, Ms Hudson, Killer Queen and Kitty Purry provided GBG with an acknowledgement, confirmation and consent letter relating to e-commerce and URL rights.
On 22 June 2017, Myer Pty Ltd and TEG Dainty Pty Ltd entered into a sponsorship agreement in relation to Ms Hudson’s forthcoming Witness Tour which included rights to promote a “Katy Perry” branded shoe range.
By a letter dated 11 October 2017 (October 2017 letter), Mr Donnell, who had left Bravado in 2016, proposed that his new company, Blackout Merch, be engaged for the purposes of merchandising goods. The primary judge records that Ms Hudson agreed to change merchandising arrangements from Bravado to Blackout Merch and refers to the evidence concerning the Blackout Merch arrangements as follows:
237… As far as Mr Jensen can recall there was no formal contract between DMG and Blackout Merch in relation to KATY PERRY branded merchandise and, for the commercial merchandising activities referred to in the October 2017 Letter and in a subsequent email exchange between Messrs Donnell and Jensen between 9 and 11 April 2018, the parties conducted themselves generally in accordance with those documents (which I will refer to together as the Blackout Merch Agreement).
238Mr Jensen considered that the proposed commercial merchandising arrangements with Blackout Merch presented Ms Hudson with a significant commercial opportunity in relation to merchandise to be offered to the public in connection with her music activities, both at concert venues and through e-commerce. Mr Jensen discussed the proposed arrangements and the main commercial terms with Ms Hudson. According to Mr Jensen, Ms Hudson knew Mr Donnell and had worked with him for many years. Mr Jensen recommended that she proceed with the commercial merchandising arrangements through Blackout Merch for her Witness Tour.
From September 2017 until August 2018, Ms Hudson embarked on the Witness Tour performing at 115 shows across 33 countries, including 14 shows in Australia at which “Katy Perry” branded merchandise was sold. Whilst on the Witness Tour, Ms Hudson appeared at Westfield shopping centres in Perth, Adelaide, Melbourne and Brisbane to promote Katy Perry branded footwear.
Since the Witness Tour, Epic Rights has undertaken commercial merchandising arrangements for Katy Perry branded merchandise, other than footwear and handbags which are covered by the Purrfect Ventures Agreements. The primary judge records in relation to Epic Rights:
257… The relevant merchandise is that associated with Ms Hudson’s “Daisies” single, her “Smile” album and the Pokémon music video. Mr Jensen knew the principal of Epic Rights, Dell Furano, to be an experienced operator of commercial branded merchandise including for musical artists. In accordance with his general practice of communicating with Ms Hudson, Mr Jensen discussed the proposed arrangements with Epic Rights with Ms Hudson who accepted his recommendation that they proceed. The arrangements with Epic Rights are not the subject of a formal contract but are set out in an email dated 10 March 2020 (Epic Rights Email). There was evidence before me of online sales made by Epic Rights of KATY PERRY branded merchandise in Australia since the date of their appointment to 31 March 2021.
3. THE “CLOTHES” ISSUE (Cross-appeal grounds 6, 7)
3.1 Introduction
Ms Taylor’s Mark is registered for “class 25: clothes”.
Grounds 6 and 7 of the cross-appeal contend that the primary judge erred in failing to find that footwear, headgear, caps, hats and headbands (which we refer to below as headgear and footwear) fall within that registration.
3.2 The primary judge’s findings on the goods of the “clothes” issue
The primary judge noted that the word “clothes” is defined in the Oxford English Dictionary as “[c]overing for the person; wearing apparel; dress, raiment, vesture” and in the Macquarie Dictionary as “garments for the body; articles of dress; wearing apparel” (PJ at [320]). The difficulty that arose was that these definitions leave it as ambiguous whether or not headgear and footwear fall within these definitions.
The appellants contended below that the primary judge could have regard to the fact that the registration is in class 25, this being a reference to the Nice Agreement Concerning the International Classification of Goods and Services for the Purposes of the Registration of Marks which at the time drew a distinction between clothes on the one hand and footwear and headgear on the other. Their point was that, although the class heading for class 25 goods is “Clothing, footwear, headwear”, Ms Taylor had elected to register the KATIE PERRY Mark for “clothes” only. By reference to the class heading, Ms Taylor had thereby excluded footwear and headwear from the specification of the registered goods. Ms Taylor could not now contend, contrary to that election, that the specification of the KATIE PERRY Mark included footwear and headwear under the nomination of “Class 25: Clothes”. The primary judge relied on the decisions in Flexopack SA Plastics Industry v Flexopack Australia Pty Ltd [2016] FCA 235; 118 IPR 239 (per Beach J) and Trident Seafoods Corporation v Trident Foods Pty Ltd [2018] FCA 1490; 137 IPR 65 (per Gleeson J) in support of the proposition that the Nice Classification could be used to provide context for any debate as to the scope of a particular registration. Ms Taylor submitted at trial that those decisions are plainly wrong, and that the preferable authority is Nikken Wellness Pty Ltd v van Voorst [2003] FCA 816; AIPC ¶91–104 (per Wilcox J) where the Court eschewed reliance on class headings when construing the trade mark owner’s specification of the registered goods. The primary judge expressed attraction to the position propounded by Ms Taylor but was not convinced that Flexopack and Trident were wrong, and had regard to the matters relied upon by the appellants in concluding that “Class 25: Clothes” does not include headgear and footwear.
Separately the primary judge said:
340.… in my opinion the ordinary meaning of clothes is garments that cover the body but not the feet (or the head). Clothes protect the body while shoes protect the feet. They serve different purposes, are made of different materials via different manufacturing processes and tend to be sold in different stores or different areas or departments of larger stores, such as department stores. That meaning is supported by the two dictionary definitions on which Ms Taylor relies (see [320] above), both of which refer to garments or coverings for the body or person suggesting that they are coverings for the torso and limbs, rather than the feet. Further, applying a common sense meaning, as urged by Ms Taylor, I would come to the same conclusion. That is the word “clothes” is not ordinarily employed to describe shoes or footwear and is inapt for that purpose. In my opinion, an interested trader wishing to gain an understanding of the Register would come to the same view as to the nature of the goods covered by the specification of the Applicant’s Mark.
In grounds 6 and 7 of her cross-appeal, Ms Taylor contends that the primary judge erred in both aspects of her reasoning.
3.3 Consideration
The question of whether or not headgear and footwear fall within “clothes” is a matter of construction, taking into account the ordinary meaning of the word “clothes” within the application of the broader statutory scheme for the registration of trade marks.
Section 19 of the Trade Marks Act provides that a trade mark may be registered in respect of goods and/or services and that the Trade Marks Regulations 1995 (Cth) may provide for the classes into which goods and services are to be divided for the purposes of the Trade Marks Act.
Regulation 3.1 of the Regulations provides that for the purposes of s 19(3), goods and services are divided into the classes of goods and services described in Schedule 1 and that each class of goods or services has a class number corresponding to that item. Schedule 1 is entitled “Classification of goods and services”. Class 25 reads “clothing, footwear, headwear”.
A trade mark, once registered, provides the registered owner with rights that include the exclusive rights to use and authorise other persons to use that mark in relation to the goods and/or services in respect of which it is registered: s 20(1). It also confers on the registered owner the right to obtain relief under the Trade Marks Act: s 20(2). These rights are taken to have accrued to the registered owner as from the date of registration of the trade mark: s 20(3). In applying for a trade mark a person must, within an application for a trade mark, specify in accordance with the Regulations, the goods and/or services in respect of which it is sought to register the mark: s 27(3)(b).
The Regulations provide in reg 4.4 that for the purposes of s 27(3)(b), the applicant must (amongst other things):
(a)group the goods and/or services according to the appropriate classes described in Schedule 1;
(b)nominate the class number that is appropriate to the goods or services in each group and list groups in order of their class numbers;
(c)as far as practicable, specify the goods and/or services in terms appearing in any listing of goods and services that is published by the Registrar and made available for inspection by the public at the Trade Marks Office; and that
(d)if any of the goods and/or services cannot be specified using terms referred to in that published listing, then the applicant must provide sufficient information to enable the Registrar to decide the classification of the goods and/or services.
It may be seen that it is the trade mark owner who must nominate the goods and/or services in respect of which their trade mark is registered. Accordingly, that person has agency in the appropriateness of the selection.
The legislative scheme of the Trade Marks Act reveals a concern that the Register of Trade Marks be maintained as an accurate record of marks which perform their statutory function, being to indicate the trade origins of the goods to which it is intended that they be applied: Health World Ltd v Shin-Sun Australia Pty Ltd [2010] HCA 13; 240 CLR 590 at [22] (per French CJ, Gummow, Heydon and Bell JJ).
The Trade Marks Act requires that the Register be maintained containing all particulars of registered trade marks: s 207(2). It must be available for inspection, either in person at the Trade Marks Office or online: Trade Marks Act s 209. The content of the Register is prima facie evidence of any particular or other matter entered on it: Trade Marks Act s 210(1).
It is within this legislative scheme that the task of construing the goods and/or services in respect of which a trade mark is registered must be undertaken. Without being exhaustive, in our view the following approach accords with the authorities and the legislative scheme:
(1)Parliament can be taken to have intended the Register to speak for itself: Nikken Wellness at [44] (per Wilcox J). In most cases people who peruse an extract from the Register should be able to understand what it says without being obliged to make inquiries about the business history or previous conduct of the registered owner of the mark: Nikken Wellness at [44] (per Wilcox J); Energy Beverages LLC v Cantarella Bros Pty Ltd [2023] FCAFC 44; 407 ALR 473 (Energy Beverages FC) at [132] (per Yates, Stewart and Rofe JJ); Self Care IP Holdings Pty Ltd v Allergan Australia Pty Ltd [2023] HCA 8; 277 CLR 186 at [39] (per the Court).
(2)The Register is a public document that defines the scope of a statutory monopoly. It should be taken to be expressed in a manner that is not reasonably capable of being misunderstood: see Décor Corporation v Dart Industries [1988] FCA 682; 13 IPR 385 at 400 (per Sheppard J). In this respect it is analogous to the definition of an invention claimed in a patent.
(3)It may be taken, in construing the specification of goods or services, that it is a considered statement by the applicant which should be read as a whole to determine its meaning and effect: Reliance Water Controls Ltd v Altecnic Ltd [2001] EWCA Civ 1928; 12 WLUK 261 at [42] (per Mummery LJ, Kennedy and Sedley LJJ agreeing); Décor at 400 (per Sheppard J); see also Burrell R and Handler M, Australian Trade Mark Law, (3rd ed, LexisNexis Butterworths, 2024) at [6.30].
(4)The Register should be understood through the eyes of persons interested to know the scope of the monopoly. This is likely to include other traders who may be interested in using or licensing the trade mark (Woolworths Limited v BP plc (No 2) [2006] FCAFC 132; 154 FCR 97 at [58] (per Heerey, Allsop and Young JJ)) and also persons interested in dealing with the trade mark, for instance by seeking a licence or taking an assignment of it. Generally, such persons can be expected to be familiar with the language and expressions used in the trade concerned.
(5)Unless it is shown that the words used to define the goods or services have a particular or special meaning to those to whom they are taken to be addressed, they should be construed as ordinary English words, the definition of which will be a matter for the Court. On occasion, the construction of the words used may be the subject of evidence: Accor Australia & New Zealand Hospitality Pty Ltd v Liv Pty Ltd [2017] FCAFC 56; 345 ALR 205 at [185]–[195] (per Greenwood, Besanko and Katzmann JJ); Bauer Consumer Media Ltd v Evergreen Television Pty Ltd [2019] FCAFC 71; 367 ALR 393 (Bauer Consumer Media FC) (per Burley J at [244], Greenwood J agreeing at [18]).
(6)The classification of goods and services according to classes is primarily a matter of convenience in administration (for example, to facilitate searches). The nomination of a class for particular goods is not decisive as to the scope of a given registration: Re Australian Wine Importers Ltd (1889) 41 Ch D 278 at 291 (per Lindley LJ); Reckitt & Coleman (Australia) Ltd v Boden [1945] HCA 12; 70 CLR 84 at 90 (per Latham CJ); Nikken Wellness at [43]–[44] (per Wilcox J); Energy Beverages FC at [132] (per Yates, Stewart and Rofe JJ). It would appear that, in Flexopack and Trident, the Court was not taken to Australian Wine Importers or Reckitt & Coleman. Both cases were also decided before Energy Beverages FC.
Turning to the facts of the present case, we are not satisfied that Ms Taylor has demonstrated error on the part of the primary judge in her finding in PJ at [340], quoted above.
As Ms Taylor accepted in argument, at least one ordinary meaning of “clothes” is garments covering parts of the body (and not the head or feet). She contends, however, that other meanings refer more compendiously to items covering the whole of the body: a person commanded to “take off your clothes” would, she submits, naturally assume that this included all items of clothing. We do not necessarily accept that, absent more context, such a command is unequivocal. However, in our view, any ambiguity arising would not be resolved in favour of the trade mark owner. It is the obligation of the trade mark owner clearly to specify the goods in respect of which the mark is to be registered and thereby define the scope of the monopoly they claim. Where there exists a penumbra of uncertainty in the scope of the registration, this would not generally be resolved in favour of the trade mark owner. This is particularly so in the present case where Ms Taylor elected not to nominate headgear and footwear as part of the specification of the goods for which she claims trade mark protection. Having made that election, there is no warrant for construing the word “clothes” more broadly now. As was recognised in Nikken Wellness at [42] and [44] (per Wilcox J), a trade mark owner is bound by the nomination they have made. It is not appropriate to construe a specification to make it more useful for the trade mark owner. Still less would it be appropriate to construe a specification “with an eye to infringement” in a given case. That said, we observe that the Trade Marks Act provides a mechanism within s 120(2) for the monopoly afforded by trade mark registration to be broadened for the purposes of infringement by reference to “goods of the same description”, see Goodman Fielder Pte Ltd v Conga Foods Pty Ltd [2020] FCA 1808; 158 IPR 9 at [278]–[286] (per Burley J). It may be taken that Parliament intended that any unfairness attendant upon a narrow construction of the words chosen within a class be ameliorated by reference to that approach in infringement cases.
In reaching this conclusion, we are not prepared to hold that the remarks in Flexopack at [74] (per Beach J) and Trident at [48] (per Gleeson J) concerning the use of class headings as an aid to resolving ambiguity in the construction of words used to specify the registered goods or services are wrong, particularly in circumstances where a class heading confirms the meaning arrived at independently of the class heading itself. However, primacy must be given to the words actually chosen by the trade mark owner to delimit the scope of the monopoly they claim. The question of the proper classification of the goods and services can only arise after the specification has been properly construed. Thus, it is the proper construction of the specification that informs the question of classification, not the other way around.
Accordingly, grounds 6 and 7 of the cross-appeal have not been established.
4. THE JOINT TORTFEASOR ISSUE (Cross-appeal grounds 1 – 5)
4.1 Introduction
The primary judge considered the infringement case advanced by Ms Taylor by reference to eight separate Trade Channels through which allegedly infringing sales were made (PJ at [378]). The Trade Channels concerned different means by which the impugned merchandise bearing the Katy Perry Mark were promoted and sold at the following locations and tours:
(a)during the Prismatic Tour conducted by Ms Hudson in 2014 and the Witness Tour in 2018 (the tours Ms Hudson embarked on that brought her to Australia) (First Channel);
(b)at pop up stores during the Prismatic Tour in Sydney and Melbourne (Second Channel);
(c)at various retail stores (Third to Fifth and Eighth Channels); and
(d)online at various websites (Sixth and Seventh Channels).
In her cross-appeal, Ms Taylor focusses on three relationships through which the appellants are alleged to have promoted and sold the impugned product as joint tortfeasors.
The first is with Bravado which entered into the two relevant agreements discussed above, the 2011 Bravado Agreement and the 2014 Bravado Agreement (together, the Bravado Agreements). The 2014 Bravado Agreement is of relevance to the allegations of joint tortfeasorship arising from the First, Second, Third, Fifth and Sixth Channels.
The second is the Blackout Merch Agreement that was entered in advance of the Witness Tour. It is of relevance to the allegations arising from the First and Sixth Channels.
The third is the Epic Rights Agreement which is of relevance to the promotion and sale of products online via the Sixth Channel.
The primary judge set out the case law relevant to joint tortfeasorship at PJ [285]–[287] and, at PJ [389], summarised its effect, noting that liability depended on whether Ms Taylor established that one or more of Killer Queen, Ms Hudson and Kitty Purry “acted in concert in a common action or design with Bravado, or that one or all of them aided, counselled, directed or joined in commission of the tort of trade mark infringement by Bravado”. Mere facilitation would not be enough.
In her Further Amended Notice of Cross-Appeal, Ms Taylor contends that the primary judge erred:
(1)in finding that Killer Queen and Ms Hudson were not joint tortfeasors together with Kitty Purry in respect of infringing conduct arising from the “Bravado channels of sale”. This is not a term defined in the Primary Judgment, but concerns the sales made during the relationship between the appellants and Bravado (being parts of the First, Second, Third, Fifth and Sixth Channels) (grounds 1 and 2);
(2)in finding that Kitty Purry was not a joint tortfeasor in respect of infringing conduct arising from the Bravado channels of sale through the Third (the retail store Target) and Fifth (the retail stores Best & Less and Harris Scarfe) Channels (ground 2A);
(3)in finding that the appellants were not joint tortfeasors with Blackout Merch in respect of admitted infringing conduct carried out by Blackout Merch in relation to the First and Sixth Channels (ground 3);
(4)in finding that the appellants were not joint tortfeasors with Epic Rights in respect of admitted infringing conduct carried out by Epic Rights in relation to the Sixth Channel 6 (ground 4); and
(5)in finding, in relation to the Sixth Channel (certain websites) that approvals for designs and products did not originate from Ms Hudson in emails in which Ms Ngoc Hoang-DelVecchio, an employee of DMG, referred to approvals for products, designs and webstore (ground 5).
The cross-appeal does not contest findings made by the primary judge in relation to channels 4, 7 or 8. In her submissions, Ms Taylor did not press grounds 3 and 4 insofar as they concerned the conduct of Purrfect Ventures. Accordingly, these matters are not addressed below.
4.1.1First Channel – Prismatic Tour and Witness Tour
The primary judge’s reasons in relation to the First Channel were divided between findings concerning the Prismatic Tour and the Witness Tour. The conduct concerning the Prismatic Tour involved an agreement for the distribution of merchandise bearing the impugned use of the Katy Perry Mark by Bravado (governed by the 2014 Bravado Agreement). The conduct concerning the Witness Tour involved the distribution of merchandise by Blackout Merch (governed by the Blackout Merch Agreement).
4.1.1.1Prismatic Tour
The Prismatic Tour took place in 2014 during which branded merchandise bearing the Katy Perry Mark was offered for sale and sold. The primary judge noted that Ms Taylor advanced her claim for infringement on the basis that Ms Hudson was personally liable as a direct infringer, and that each of Ms Hudson, Killer Queen and Kitty Purry were liable as joint tortfeasors together with Bravado.
It was not in dispute before the primary judge that in relation to the Prismatic Tour, Bravado had sold clothing bearing the Katy Perry Mark and so infringed the KATIE PERRY Mark. The disputed issue was relevantly confined to that of joint tortfeasorship. In concluding that the facts were sufficient to establish liability on the part of Kitty Purry, but not Killer Queen or Ms Hudson, the primary judge made the following relevant findings.
On 16 December 2011, Ms Hudson and Killer Queen entered into a deed of assignment pursuant to the terms of which Ms Hudson assigned to Killer Queen all of her “rights, titles and interests in and to” the trade marks and service marks and the federal registration and US and international registrations and applications listed in schedule A to the Deed. This included the Katy Perry Mark, the use of which in respect of clothing her Honour subsequently found to infringe the KATIE PERRY Mark.
On 6 February 2014, following the release in 2013 of her fourth studio album “Prism”, and in anticipation of Ms Hudson embarking on a global concert tour in support of that album, Kitty Purry as grantor, entered into the 2014 Bravado Agreement with Bravado Merchandising in relation to the sale of Katy Perry branded merchandise including the grant of licence rights in relation to the “KATY PERRY” name and trade mark. The 2014 Bravado Agreement was signed by Ms Hudson as an authorised representative of Kitty Purry.
The 2014 Bravado Agreement governs the relationship between Kitty Purry, as the licensor of the Katy Perry Mark, and Bravado. However, there was a hiatus in the evidence concerning the terms of the relationship between Kitty Purry and Killer Queen, as the owner of Ms Hudson’s intellectual property, and the effect of the 2014 Bravado Agreement. Given the terms of the 2014 Bravado Agreement, the primary judge inferred that Killer Queen had granted a licence to Kitty Purry to use the Katy Perry Mark. The primary judge noted in this respect that the timing of and reasons for the grant of that licence was not the subject of evidence, but that the mere granting of this licence did not establish liability for joint tortfeasorship on the part of Killer Queen.
Bravado, by the time of the 2014 Bravado Agreement, was licensed to use the Katy Perry Mark in relation to the production and sale of merchandise for the purpose of the Prismatic Tour. The primary judge found:
397.…The 2014 Bravado Agreement confers a licence on Bravado, sets out Bravado’s entitlements and its obligations in relation to the design, development and production of merchandise, sets out Kitty Purry’s obligations in relation to, among other things, ensuring the exclusivity of Bravado’s licence, its ability to sell merchandise at concert venues and its entitlement and obligations in relation to the approval of designs and the provision of artwork, provides for the fees and royalties payable to Kitty Purry in relation to the sales made and for the undertaking of an audit of Bravado’s accounts.
398.The 2014 Bravado Agreement does more than merely permit Kitty Purry to exercise quality control in relation to the merchandise to be offered of sale. The agreement governs the whole of the relationship between Kitty Purry and Bravado in relation to the use of the Katy Perry Mark in connection with the development and sale of the merchandise to be sold which bears that mark. Kitty Purry is involved in the process and earns revenue from the sale of the merchandise, as approved by it for sale and sold, at concerts performed by Ms Hudson pursuant to an exclusive licence to do so granted by it to Bravado. The fact that some of the terms in the 2014 Bravado Agreement are, as the respondents contend, “best endeavour” clauses is not to the point and does not detract from the fact that Kitty Purry assumed obligations to assist Bravado in its role of design, manufacture and sale of KATY PERRY branded merchandise for their mutual benefit.
Various emails in evidence dated before the Prismatic Tour demonstrated that Ms Hudson was closely involved in providing feedback on, and approving, the design of merchandise as well as identifying the merchandise she wished to bring on tour, as Mr Jensen accepted in cross‑examination.
In relation to the role of Ms Hudson as an alleged joint tortfeasor, the primary judge observed that Kitty Purry had a contractual right under the 2014 Bravado Agreement to approve the design of merchandise to be sold at concerts during the tour. The evidence demonstrated that Ms Hudson was personally involved in decisions about the type, design and items of merchandise bearing the Katy Perry Mark to be offered for sale. However, her Honour found:
404.… But there is nothing unusual about that given her role as CEO and sole director of Kitty Purry and the fact that the merchandise to be offered for sale bore her name. Ms Hudson was, as the respondents submitted, the human agent through which Kitty Purry exercised its contractual rights. The evidence demonstrates that both Kitty Purry and Bravado acted in accordance with the obligations imposed on them under the 2014 Bravado Agreement, at least insofar as the design and approval of merchandise was concerned. There is no reason to conclude that they did not do so in relation to the other obligations imposed on them under that agreement. Indeed the evidence demonstrates that Kitty Purry, through its CEO and director, was intimately involved in the finalisation of the merchandise for sale at the concerts.
These matters led the primary judge to the conclusion that Kitty Purry acted in a common design with Bravado to design, manufacture and offer for sale clothes bearing the Katy Perry Mark such that it, but not Ms Hudson, was a joint tortfeasor.
The primary judge rejected the contention that Killer Queen was also a joint tortfeasor:
408Finally, further facts identified by Ms Taylor as part of the factual matrix on which she relies to prove liability of the respondents as joint tortfeasors are that Ms Hudson controls Killer Queen and Kitty Purry and, while Kitty Purry was the licensor to Bravado, Kitty Purry was licensed by Killer Queen. Insofar as those factors are concerned:
(1)the fact that Ms Hudson is the controlling mind of both Killer Queen and Kitty Purry does not assist in establishing a common design on her part, including when considered in light of the other facts relied on by Ms Taylor;
(2)the fact of a close relationship between two companies, which I would infer to be the case in relation to Killer Queen and Kitty Purry given their common ownership and management, is not of itself sufficient to establish a common design. That is so even if there is overall financial and voting control and the companies regard themselves as a single economic unit (of which there is no evidence in this case): see Apotex Pty Ltd v Les Laboratoires Servier (No 2) (2012) 293 ALR 272; [2012] FCA 748 at [26]; and
(3)Ms Hudson was the owner of the Katy Perry Mark (at least in Australia) until 2011 when she assigned it to Killer Queen. Given the 2014 Bravado Agreement, I would infer that thereafter Killer Queen granted a licence to Kitty Purry to use that mark. The timing of and reasons for the grant of that licence was not the subject of evidence. In any event, the mere granting of a licence does not establish liability for joint tortfeasorship on the part of Killer Queen. There is no evidence that Killer Queen combined with any party in a common design to secure the doing of acts which amounted to the infringement by Bravado, including when viewed as part of the factual matrix relied upon by Ms Taylor.
4.1.1.2Witness Tour
In relation to the Witness Tour by Ms Hudson, it was not in dispute that the infringing Katy Perry Mark appeared on clothing offered and sold as merchandise, but this was sold for this concert tour by Blackout Merch rather than by Bravado, as discussed at [40]–[41] above. The case advanced by Ms Taylor was that the Court should find that the arrangements between Bravado were, in substance, the same as those subsequently entered into with Blackout Merch.
In rejecting this proposition, the primary judge noted early in her reasons that in July 2008, Mr Jensen had worked with Mr Donnell of Bravado for some 15 years before engaging Bravado in relation to the supply of merchandise for Ms Hudson’s tours. In 2016, Mr Donnell left Bravado and Mr Jensen decided to take the business to him at his new business, Blackout Merch. The primary judge found that the terms of the new arrangement were briefly expressed in the October 2017 letter and in some emails that followed it.
The primary judge relevantly found that:
(1)the Blackout Merch Agreement gave Blackout Merch exclusive rights in relation to merchandise to be sold bearing the Katy Perry Mark while Ms Hudson was on tour and required Ms Hudson to provide transportation of merchandise while on tour at no charge to Blackout Merch; and
(2)whilst Ms Hudson continued to make suggestions in relation to the design of merchandise and provided approval for the merchandise to be offered for sale, the primary judge rejected the submission that Ms Hudson had a contractual right of refusal, finding:
430.As was apparent from emails which were in evidence between Ms Hoang-DelVecchio and, among others, Mr Donnell, during the course of the relationship with Blackout Merch, Ms Hudson continued to make suggestions in relation to the design of, and provide approval for, merchandise to be offered for sale. However, once again it does not follow from that practice that the arrangements with Blackout Merch were practically the same as those with Bravado. It does no more than demonstrate that Ms Hudson continued to be interested in, to consider and approve merchandise associated with her, despite there being no express term in the Blackout Merch Agreement giving any of the respondents a right of approval of the design or quality of the merchandise to be offered for sale nor of which merchandise was to be brought on tour. That is unsurprising given the likelihood that Ms Hudson would be interested in the development of her brand as it applied to merchandise and in the arrangements for the Witness Tour and would wish to protect her Katy Perry Mark and the reputation in the name “KATY PERRY”.
The primary judge concluded:
434.The only evidence of the arrangement between Blackout Merch and the respondents for the sale of KATY PERRY branded merchandise during the Witness Tour is as set out in the Blackout Merch Agreement. Given its terms and the lack of any other evidence I would not conclude that the respondents or any of them acted in concert with Blackout Merch to secure the doing of acts that constituted infringement of the Applicant’s Mark by Blackout Merch in its offering for sale and sale of clothes, and goods of the same description, bearing the Katy Perry Mark in Australia during the Witness Tour. That claim is not made out.
4.1.2Second Channel – Pop-up Stores
In relation to the Second Channel, pop-up stores, the primary judge found that the business arrangements were in effect the same as those that applied for the Prismatic Tour under the 2014 Bravado Agreement and accordingly that the same conclusions as to joint tortfeasorship applied. These were:
(1)Bravado, as licensee of the Katy Perry Mark, had infringed the KATIE PERRY Mark, by advertising and selling clothes bearing the Katy Perry Mark;
(2)Kitty Purry was liable as a joint tortfeasor in relation to the advertising and selling of clothes bearing the Katy Perry Mark in pop-up stores; and
(3)Killer Queen and Ms Hudson were not found liable as joint tortfeasors.
4.1.3Third Channel – Target Stores
The primary judge noted that the Third Channel of sale concerns the sale of clothes bearing the Katy Perry Mark in the period 2014 until 2016 by Target Australia Pty Ltd in its stores and online through its website (Target website). The sales were made during the currency of the 2014 Bravado Agreement.
The primary judge records that Ms Taylor relied on the terms of the 2014 Bravado Agreement and other documents to demonstrate that Ms Hudson kept close control over the goods sold by Target, contending that Ms Hudson’s involvement was such that not only was she personally liable as an infringer (together with Bravado and Target) but that she, Kitty Purry and Killer Queen were also joint tortfeasors. The appellants repeated their submissions going to the arrangements between Ms Hudson, Killer Queen and Kitty Purry and contended that the evidence rose no higher than to demonstrate that Ms Hudson acted as a director of Kitty Purry.
The primary judge noted that it was not in dispute that certain clothing bearing the Katy Perry Mark were marketed and sold by Target in its stores and on the Target website and that these sales were made pursuant to the terms of the 2014 Bravado Agreement. The operation of cl 3.01(b) of the 2014 Bravado Agreement relevantly gave Bravado the exclusive right to sell licensed products through, and by distribution to, retailers. Her Honour also noted that Ms Taylor relied on particular evidence in correspondence tendered of Ms Hudson’s close control over the approval and production of the clothing, finding that a number of these demonstrated Ms Hudson’s involvement, either by providing her views about, and input into, the proposed designs of items of clothes or by approval of designs for sale, including by requesting revisions. However, this was involvement by Ms Hudson in her capacity as the CEO and sole director of Kitty Purry.
The primary judge concluded:
463The facts relied on by Ms Taylor do not evidence that Killer Queen, Ms Hudson and/or Kitty Purry were joint tortfeasors with Bravado and Target in relation to their infringement of the Applicant’s Mark. Ms Taylor has not demonstrated that there was a common profit seeking design by all or any of them with Target and Bravado as alleged. While by the 2014 Bravado Agreement Kitty Purry granted Bravado a licence to use the Katy Perry Mark, including in relation to the sale of the relevant products through third-party retailers, and Kitty Purry had a right to approve designs sold through those retailers, and exercised that right, that is where its involvement ended. In contrast to the sale of the relevant merchandise at concerts and in the related pop-up stores, Kitty Purry had no responsibility for the transport of the merchandise and representatives of Bravado, for facilitating space in the venues where the merchandise was to be sold or for providing for or ensuring any other aspect of sale of the merchandise. Its role in relation to the sale of clothes by Target was limited to one of facilitation.
4.1.4Fifth Channel – Harris Scarfe and Best & Less
The primary judge notes that the Fifth Channel concerns sales of clothes bearing the Katy Perry Mark through the Australian retailers Harris Scarfe and Best & Less and notes the submissions advanced by Ms Taylor that she became aware of this channel of sales later in her preparation for hearing, arising from the late discovery of documents. She submitted that each of these outlets were operated by Pepkor South East Asia Pty Ltd, which entered into an agreement with Universal Music Australia Pty Ltd trading as Bravado Merchandise (UMA) in relation to the distribution of goods bearing the Katy Perry Mark.
The primary judge found that some clothes bearing the Katy Perry Mark were sold by each of Best & Less and Harris Scarfe in the financial years 2015 to 2019. Her Honour concluded that those sales were most likely governed by the 2014 Bravado Agreement, noting that the effect of that agreement was to “give Bravado the exclusive right to use the Katy Perry Mark in connection with the manufacture, advertisement, merchandising, promotion and sale of any merchandise and to give Kitty Purry the right to consult in relation to the preparation of artwork to be used in connection with the products and to approve the artwork”. She also found that Bravado agreed to appoint Pepkor as a non-exclusive distributor and reseller, to market and sell Bravado products in Australia including products bearing “artist indicia” which relevantly included the Katy Perry Mark.
The primary judge considered email correspondence relied upon by Ms Taylor in support of the contention that Ms Hudson had personal involvement in sales. In one email dated 11 August 2014, a representative of Bravado communicated to Pepkor that Ms Hudson “no longer likes the design and feels it does not tie in with her graphics…”. The primary judge rejected a submission that this email showed that Ms Hudson was involved in providing her personal views in selecting goods to be sold and about their style, as opposed to acting as an officer of Kitty Purry. Moreover, the primary judge found that it was not apparent from this email that Ms Hudson was aware that she was addressing merchandise to be offered for sale by Harris Scarfe or that any such merchandise was to be sold through that retailer. In relation to a second chain of email communication, the primary judge accepted that Ms Hudson was personally engaged in the approval process for designs concerning Harris Scarfe products but was not satisfied that Ms Taylor had demonstrated the capacity in which she was supplying her approval. Taken together, the primary judge was not satisfied that the evidence supported a conclusion that any of the appellants was a joint tortfeasor with Bravado and Harris Scarfe or Best & Less.
The primary judge separately rejected a submission that given the paucity of evidence, there was no reason to think that the process of creation of goods for sale and the sale of those goods would have been any different to that determined in relation to Target. The primary judge explained in some detail, from PJ [500]–[505], why this was so. However, it is not necessary to address these matters in the present appeal, as no ground or submission is advanced in relation to this aspect of the case below.
4.1.5Sixth Channel – Websites
The Sixth Channel concerns the sales of goods bearing the Katy Perry Mark through three classes of websites. The first is the Bravado Website which advertised and sold goods bearing the Katy Perry Mark to customers in Australia. The second is a website at katyperry.shop.musictoday.com/store which, from about 2016 until 2020, advertised and sold goods bearing the Katy Perry Mark to customers in Australia (Blackout Merch Website). The website was operated by Music Today, LLC and was used by Blackout Merch as a channel through which to sell and offer Katy Perry merchandise. The third is a series of websites through which Ms Taylor contended Epic Rights sold and promoted merchandise bearing the Katy Perry Mark (Epic Rights Websites).
In relation to the Bravado Website the primary judge found that, from 24 October 2013 until about 2016, infringing goods were offered and sold pursuant to the terms of the 2011 Bravado Agreement and thereafter pursuant to the terms of the 2014 Bravado Agreement. The primary judge found that the terms of the two agreements were substantially the same. Her Honour concluded, for substantially the same reasons as her earlier reasons that Kitty Purry was a joint tortfeasor with Bravado, but that Killer Queen and Ms Hudson were not:
516I am satisfied in relation to the advertising, offering for sale and sales of clothes, and goods of the same description, bearing the Katy Perry Mark on the Bravado Website that Kitty Purry engaged in a “common design” with Bravado and is liable as a joint tortfeasor in relation to Bravado’s infringement. I have reached that conclusion for the following reasons:
(1)by the terms of the 2011 Bravado Agreement and the 2014 Bravado Agreement Kitty Purry granted Bravado an exclusive right to build a webstore to sell Licensed Products with Kitty Purry maintaining control over approval of designs to be offered for sale on the webstore. That is, as Kitty Purry granted a licence for Bravado to build and operate a webstore and to offer merchandise for sale globally Kitty Purry was aware of and indeed approved the goods which were offered for sale;
(2)by the 2014 Bravado Agreement, Kitty Purry granted Bravado further rights in relation to the webstore and its operation including co-ordinating with Bravado in the promotion and marketing of the merchandise offered for sale “by sending email blasts to their fan club lists and [posting] news bulletins” and Facebook posts referring to the webstore;
(3)a link to the webstore was maintained on Ms Hudson’s official site; and
(4)there was evidence that Kitty Purry, through its director, Ms Hudson, approved the design of goods to be manufactured and thus offered for sale by or through Bravado.
517I do not reach the same conclusion in relation to Killer Queen and Ms Hudson. They were not party to the 2011 Bravado Agreement or the 2014 Bravado Agreement. They were no more than facilitators. In the case of Killer Queen, it granted a licence in relation to the Katy Perry Mark to Kitty Purry and, in the case of Ms Hudson, she signed the side agreement which appears as Exhibit A to each of the 2011 Bravado Agreement and the 2014 Bravado Agreement. Any involvement by Ms Hudson in approving designs was in her capacity as the chief executive officer and sole director of Kitty Purry.
In relation to the Blackout Merch Website, the primary judge found that the terms upon which Blackout Merch became the licensee for the sale of Katy Perry branded merchandise are set out in the Blackout Merch Agreement (see section 2.3 above), pursuant to which, amongst other things, Blackout Merch was granted worldwide exclusive e-commerce rights. Ms Taylor submitted that the Court should find that the arrangements with Blackout Merch were substantially the same as those with Bravado concerning e-commerce and that each of Killer Queen, Ms Hudson and Kitty Purry were joint tortfeasors with respect to Blackout Merch’s infringement. The primary judge rejected this argument and also rejected Ms Taylor’s argument that Ms Hudson had exercised close control over the Blackout Merch Website by reference to a series of emails and messages. She concluded that none of them, whether alone or collectively, were evidence that any of Ms Hudson, Killer Queen or Kitty Purry had any significant input into this channel of sales.
In relation to the Epic Rights Websites, the primary judge noted Ms Taylor’s contention that Killer Queen, Ms Hudson and Kitty Purry are liable as joint tortfeasors with Epic Rights in relation to goods bearing the Katy Perry Mark. Her Honour found that since the Witness Tour, Epic Rights had undertaken commercial merchandising arrangements for Katy Perry branded merchandise (other than footwear and handbags which are subject to separate arrangements under Purrfect Ventures Agreements), the terms of which are set out in an email dated 10 March 2020 (Epic Rights Email). Pursuant to these terms all merchandise sold in Australia was sold online, including through the Epic Rights Websites, and included infringing goods bearing the Katy Perry Mark.
The primary judge did not infer that the agreement with Epic Rights was substantively the same as the Bravado Agreements insofar as those agreements concerned e-commerce. This was despite evidence from Mr Jensen that the “arrangements” with Epic Rights were, in a practical sense, similar to those with Bravado and Blackout Merch. The primary judge found this for the following reasons:
(1)there was no evidence that the detailed terms in the Bravado Agreements concerning e-commerce and approvals applied equally to the arrangements with Epic Rights;
(2)it logically could not be the case that, because practical arrangements for aspects of the relationship with Epic Rights remained the same, the otherwise detailed terms in the Bravado Agreements would apply to the arrangements with Epic Rights; and
(3)none of those relevant facts (the email exchanges and WhatsApp messages upon which Ms Taylor sought to rely) established that Ms Hudson, Killer Queen or Kitty Purry acted in concert with Epic Rights and others in respect of any infringement by them of Ms Taylor’s Mark.
4.2 Relevant principles of joint tortfeasorship
A principal aspect of Ms Taylor’s claim against the appellants is that they, or some of them, are liable as joint tortfeasors for infringement under s 120 of the Trade Marks Act. As a result of the decision of the Full Court in PDP Capital Pty Ltd v Grasshopper Ventures Pty Ltd [2021] FCAFC 128; 285 FCR 598, it is apparent that a statutory remedy for infringement against persons who “authorise” infringing use is not available: at [64]–[75] (per Jagot, Nicholas and Burley JJ). Rather, Ms Taylor relies on the common law doctrine of joint tortfeasorship.
The broad principle of the liability of joint tortfeasors was considered in Thompson v Australian Capital Television Pty Ltd [1996] HCA 38; 186 CLR 574. In that case, a television station, Channel 7, broadcast a current affairs programme produced by Channel 9 live to viewers in the Australian Capital Territory. The licence to broadcast was granted by Publishing & Broadcasting Pty Ltd (PBL), which was a related entity of Channel 9. The content of the broadcast was defamatory of Mr Thompson. He settled with Channel 9 and executed a deed of release between himself, Channel 9 and PBL, then subsequently sued the broadcaster in the Supreme Court of the Territory. Channel 7 joined Channel 9 and PBL as third parties, seeking, amongst other things, contribution. Although Channel 7 took no part in the production of the programme, it acted in its own right and had the ability to control and supervise the material it televised. It voluntarily decided to broadcast live. Channel 7 sought to defend the proceedings on the grounds that it and the producer were joint tortfeasors and that the release granted to the producer by Mr Thompson also released it.
The consideration for s 60 is the notional normal and fair use of the mark across all relevant goods or services. The absence of actual confusion in this case, explicable by the limited use by Ms Taylor of her mark, tells little about the likelihood of any confusion arising from the notional fair use that might be made of Ms Taylor’s Mark, and it does not merit the significant weight given to it by the primary judge.
Fourth, the primary judge placed some significance on how the Katy Perry Mark had actually been used by Ms Hudson subsequent to the priority date. At PJ [751], the primary judge took into account the actual use of the Katy Perry Mark on clothes sold by the appellants, and the fact that on those clothes the Katy Perry Mark is usually accompanied by graphics or photos of Ms Hudson. However, the relevant comparison for considering whether use of Ms Taylor’s Mark is likely to deceive or cause confusion is between the reputation of the Katy Perry Mark, and a notional normal and fair use of Ms Taylor’s Mark. Rather than just the reputation acquired by the Katy Perry Mark, the primary judge considered actual use of the mark, in combination with distinguishing graphics and photos, at a time after the priority date. At PJ [742], the primary judge found that as at the priority date, Ms Hudson had not launched her clothing brand. Post priority date use of the Katy Perry Mark on clothes that also bear images of Ms Hudson is not relevant to the s 60 enquiry.
Whilst each error on its own might be a matter on which minds may differ, the combined effect of the four errors leads us to conclude that the primary judge’s assessment was affected by error.
Once the common practice is taken into account, together with the primary judge’s finding that the Katy Perry Mark had a reputation in music and entertainment, and Ms Hudson’s own reputation in the name “Katy Perry”, and the correct comparison is made, we consider that because of the reputation in the Katy Perry Mark, the use by Ms Taylor of her mark on clothes would be likely to deceive or cause confusion. Appeal ground 3 is successful.
9.3.1Discretion not to cancel for ground 3
Ms Taylor submits that even if s 60 is satisfied, the Court should refuse to cancel her mark based on ss 88(1)(a) or 89(1)(b) of the Trade Marks Act. The primary judge did not consider the question of whether to exercise the discretion, as it did not arise on the basis of her conclusions.
Section 88(1), which is expressed to be subject to ss 88(2) and 89, provides that the Court may, on the application of an aggrieved person or the Registrar, order that the Register be rectified by:
(a) cancelling the registration of a trade mark; or
(b) removing or amending an entry wrongly made or remaining in the Register; or
(c) entering any condition or limitation affecting the registration of a trade mark that ought to be entered.
The Full Court in Anchorage FC observed at [146] that, unless s 89 is engaged, the discretion under s 88(1) is at large, constrained only by the general scope and objects of the Trade Marks Act. At [158], the Full Court observed that the correct approach to the exercise of the discretion under s 88(1), once enlivened (except in so far as that discretion is qualified by the operation of s 89), is to ask whether sufficient reason appears not to order the cancellation of the registered mark. Where the grounds for cancellation are satisfied, it is for the registered owner to persuade the Court that the discretion not to cancel should be exercised in its favour.
Section 89(1) provides that the Court may decide not to grant an application for rectification made:
(a) under s 87; or
(b) on the ground that a trade mark is liable to deceive or confuse (a ground on which its registration could have been opposed (s 88(2)(a) in the present case, s 60); or
(c) on the ground referred to in s 88(2)(c),
if the registered owner of the trade mark satisfies the court that the ground relied on by the applicant has not arisen through any act or fault of the owner.
Once the threshold for enlivening the discretion under s 89 is passed, sub-s 89(2) provides that in making a decision under s 89(1), the court must take into account certain prescribed matters, as well as any other matter that the court considers relevant.
Regulation 8.2 provides a non-exhaustive list of matters relevant to the exercise of the discretion. These include the extent to which the public interest will be affected if the registration is not cancelled, whether any circumstances giving rise to the application for cancellation have ceased to exist, and whether there is any alternative remedy or order that would be adequate in the circumstances.
Whilst there is an overlap between the situations in which ss 88 and 89 could apply, that overlap is not complete. There will be circumstances, such as invalidity on a ground not involving deception or confusion where s 88, rather than s 89 will apply.
In this case, s 89 is engaged as we have found that Ms Taylor’s Mark is liable to be cancelled on the ground that the trade mark is liable to deceive or cause confusion pursuant to s 60, a ground on which the application for the registration of Ms Taylor’s Mark could have been opposed (s 88(2)(a)).
Ms Taylor submits that the exercise of discretion under s 89 is intended to codify the previous law as to “blameworthy” conduct, stating that a concern of this provision is to avoid a situation where “the activity of a competing trader which would otherwise be regarded as infringement can bring about a situation where the proprietor’s use of its mark, because of confusion, leads to its invalidity”: HTX International Pty Ltd v Semco Pty Ltd [1983] FCA 225; 49 ALR 636 at (per Fox J). In essence, the Court may exercise its discretion not to cancel a mark, if the registered owner of the mark is able to satisfy the Court that the ground relied upon, that the trade mark is liable to deceive or confuse, has not arisen through any act or fault of the registered owner. If the registered owner is able to satisfy the Court, then the Court may exercise its discretion not to grant an application for rectification.
However, the threshold for enlivening the discretion under s 89 is broader than just the “blameworthy” conduct of the trade mark owner. Section 89 refers to “act or fault”, rather than just fault. The inclusion of “act” with the disjunctive “or” suggests that the enquiry is not restricted to blameworthy conduct, but whether the conduct of the trade mark owner has contributed to the mark becoming liable for removal on the basis of deception or confusion.
Ms Taylor submits that the s 89 discretion is enlivened. Ms Taylor relies on the following matters:
(a)Ms Taylor’s honest adoption of her mark in 2007, without any knowledge of Ms Hudson, in the course of commencing to trade under her own name;
(b)Ms Taylor only became aware of Ms Hudson in July 2008, by which time Ms Taylor had already incurred significant personal expense in terms of time and money in her brand. At that time Ms Hudson’s merchandising efforts were not directed to Australia specifically;
(c)Ms Hudson achieved her reputation within a few months prior to the priority date. Ms Taylor submitted that this acquired reputation was a “bolt from the blue”.
(d)There has been no actual confusion, despite Ms Taylor trading continuously under her mark since the priority date, and nor is there likely to be any confusion.
The appellants submit that the s 89 discretion is not enlivened. According to Ms Taylor, the earliest time that she became aware of Ms Hudson was in July 2008 when she first heard the song “I Kissed a Girl” (PJ at [127]). It was after that awareness, in September 2008, that Ms Taylor made a conscious decision to file her application for a trade mark for a mark that was deceptively similar to Ms Hudson’s stage name, Katy Perry. Ms Taylor accepted that, as at September 2008, she knew that Ms Hudson was a nationally and internationally famous pop star, and that musical artists such as Ms Hudson offered for sale clothing bearing their names at their concerts.
This case is an unfortunate one in the sense that two enterprising women in different countries each adopted their name as a trade mark at a time that each was unaware of the existence of the other. Both women put blood, sweat and tears into developing their businesses. One became an internationally famous entertainer in the music industry, the other, a small Australian fashion designer. As the fame of one grew internationally, the other became aware of her namesake and filed a trade mark application.
Although Ms Taylor adopted her mark innocently, by the time she applied for her mark she had knowledge of Ms Hudson, her reputation, and her mark. She also accepted that at the time she filed her application, she knew that it was likely that music artists sold clothing bearing their names at concerts and that celebrities often moved into merchandising. Ms Taylor applied for her mark with knowledge of the matters that ultimately led to Ms Hudson’s success on the s 60 ground.
We consider that Ms Taylor’s act of filing the trade mark application with knowledge of Ms Hudson, her reputation, and her mark in circumstances where she also knew that popular music stars, such as Ms Hudson, lend their names (and trade marks) to be used in connection with clothes and sell merchandise at their concerts, and accepted such conduct as a common practice, is sufficient not to enliven the discretion under s 89.
In the event that the discretion was to be enlivened, we would not have exercised that discretion in Ms Taylor’s favour for the following reasons.
First, from time to time, Ms Taylor has sought to align herself with Ms Hudson in order to obtain some reflected benefit, conduct which would only increase the likelihood of consumers potentially being deceived or confused (PJ at [220]).
Second, although there is no evidence that any consumers have actually been confused despite the many years of overlapping use of the two marks in Australia, the Full Court observed in Anchorage FC in the context of the s 88 discretion, that whilst an absence of deception during the years of overlapping use is a consideration that may be relevant to the exercise of the discretion, it is not a determinative consideration, or even one that must be given significant weight: Anchorage FC at [166] (per Nicholas, Yates and Beach JJ).
Third, the public interest considerations in preserving the integrity of the Register and protecting consumers from being confused or deceived do not favour the exercise of the discretion not to remove Ms Taylor’s Mark from the Register. There is a public interest in ensuring that trade mark registrations only be made in favour of applicants who are entitled to obtain them. As the High Court explained in Health World Ltd at [27] (per French CJ, Gummow, Heydon and Bell JJ), the Trade Marks Act offers various facilities for “… ensuring that the Register is pure in the sense that no mark is to be registered unless valid, and no registration of a mark is to continue if it is not valid …”. The Full Court in Anchorage FC gave significant weight to the public interest considerations: see Anchorage FC at [163], [192] (per Nicholas, Yates and Beach JJ).
Fourth, in July 2009, Ms Hudson proposed a co-existence agreement with Ms Taylor that would have let both Ms Hudson and Ms Taylor continue to use their marks. Ms Taylor rejected that offer of a co-existence agreement, which as circumstances turned out, would have been an excellent outcome for both parties. The absence of any actual confusion over the many years of co-existence suggests that there has been no confusion on the part of consumers. However, having rejected the offer, Ms Taylor then chose to commence infringement proceedings against the appellants. In that sense, Ms Taylor has brought this result on herself. Unfortunately, it is no longer possible to return to the time of peaceful co-existence.
Having considered the matters raised by Ms Taylor discussed above, we are not satisfied that sufficient reason has been shown to not cancel the registration of Ms Taylor’s Mark, even if we considered the relevant discretion to be enlivened, which we do not.
9.4 The submissions – circumstances applying at time of application for rectification pursuant to s 88(2)(c) (Appeal ground 4)
The appellants challenge the primary judge’s rejection of their cancellation case based on s 88(1)(a) on the ground set out in s 88(2)(c) because of circumstances applying at the time when the application for rectification was filed, the use of Ms Taylor’s Mark was likely to deceive or cause confusion.
The appellants contend that in coming to her conclusion at PJ [789], the primary judge again placed undue reliance on the absence of any actual confusion (after 10 years of use of both marks) and her conclusion that the strength of the reputation in the Katy Perry Mark was a compelling reason why a person would not be caused to wonder whether clothes bearing Ms Taylor’s Mark were from the same source, to refuse to cancel Ms Taylor’s Mark.
For the same reasons as they articulate in relation to ground 3, the appellants contend that the absence of actual confusion is both explicable in the circumstances, and of little assistance. The lack of evidence of actual confusion tells one nothing about the likelihood of such confusion arising from any notional use of the Ms Taylor’s Mark, as at December 2019.
By the date of filing of the cross-claim, the primary judge found at PJ [785] that Ms Hudson had achieved international fame and that the Katy Perry Mark had a significant reputation, including in relation to her shoe collection and clothing. Given the strength of that reputation, the appellants contend that the primary judge ought to have concluded that the likelihood that consumers would be confused was enhanced, particularly in light of the purchaser’s reasonable expectation that celebrities such as Ms Hudson often have their own fashion labels.
Ms Taylor accepts that the primary judge did err in relation to s 88(2)(c), but submits that the error would not change her Honour’s conclusion. The primary judge erred by finding at PJ [782] that Ms Taylor accepted that the relevant consideration for the purposes of s 88(2)(c) was whether there would be a likelihood of deception and confusion based on notional use. However, Ms Taylor’s submission at trial was that notional use was not the relevant comparison. Ms Taylor submits that the question in s 88(2)(c) is directed to present circumstances. Thus, the relevant test is an actual likelihood assessed as at 20 December 2019. Based on actual circumstances then applying, would Ms Taylor’s use of her mark be likely to cause deception or confusion?
Ms Taylor submits that based on the two key factors identified by the primary judge — the absence of any actual confusion over the ten-year period of trading and the fame of the Katy Perry Mark — the primary judge’s conclusion is reinforced by the actual, rather than nominal, use analysis. Further, on an actual use analysis, Ms Taylor contends that the absence of any evidence of confusion verges upon determinative. According to Ms Taylor, her limited use of her mark, is part of the factual matrix which shows that as at 20 December 2019, there was no likelihood of confusion.
Ms Taylor submits that if the Katy Perry Mark is as famous as Ms Hudson contends, as the primary judge found by this date, then consumers knowing Ms Hudson by reputation would be likely to remember Katy with a “y” not an “ie” — which Ms Taylor describes as a “striking difference”, and an “unusual spelling of the name”.
9.5 Consideration
The primary judge approached the likelihood of deception and confusion for the purposes of s 88(2)(c) by reference to any “normal and fair use” of Ms Taylor’s Mark. As the primary judge noted at PJ [787], that involved use of Ms Taylor’s Mark on “hoodies, t-shirts, tank tops and booty shorts”. Despite supporting that position at trial, Ms Taylor submitted on her notice of contention (ground 4) that the comparison should be assessed on the actual use of Ms Taylor’s Mark.
The primary judge concluded at PJ [789] that having regard to the circumstances applying as at December 2019, the use of Ms Taylor’s Mark on clothes was not likely to deceive or cause confusion. In addition to the absence of any evidence of actual confusion, the primary judge considered that the strength of Ms Hudson’s reputation and the reputation in the Katy Perry Mark was a “compelling reason why a person would not be caused to wonder whether clothes bearing [Ms Taylor’s] Mark were from the same source as those bearing the Katy Perry Mark” (PJ at [791]).
At PJ [792], the primary judge observed that her conclusion accorded with those of Davies J in Singtel Optus and Jessup J in Delfi Chocolate. In contrast to the present case, in both Singtel Optus and Delfi Chocolate, the marks in suit were found to be not substantially identical or deceptively similar. In both cases, the strong reputation in each mark acted to enhance the prospect that no consumers would be likely to be confused by the different marks. The prospect that consumers would be unlikely to be confused already arose from the marks not being deceptively similar. Contrast that with the case of deceptively similar marks. In that case, before the reputation is factored in, by reason of the deceptive similarity alone, the marks are likely to deceive or cause confusion: s 10 of the Trade Marks Act.
In Singtel Optus, Davies J found that the marks “OPTUS” and “OPTUM” were not deceptively similar: at [138] (per Davies J). It was the combination of the differences between the marks and the strong reputation attaching to the ‘OPTUS’ mark in relation to telecommunications that led Davies J to conclude that there would be no likelihood of confusion.
Likewise, in Delfi Chocolate, Jessup J found that the marks “MALTESERS” and “MALTITOS” were not deceptively similar. Jessup J observed at [27] that, for the purposes of s 60, the consumer is assumed to have that level of awareness of the mark as is consistent with the content and extent of the reputation of it. At [28] Jessup J found that the “MALTESERS” mark was “strongly embedded in the consciousness” of the notional consumer, it had a very widespread, solid reputation in the area of packaged confectionery. His Honour considered that a customer looking at a Maltitos package would be immediately struck by the differences between the two marks, and after a moment’s reflection would readily conclude that those products were not Maltesers. That conclusion was based solely on the differences between the two marks. Jessup J observed that the strong reputation of the Maltesers mark would, if anything “make that conclusion a more likely one”: Delfi Chocolate at [27] (per Jessup J).
Singtel Optus and Delfi Chocolate support the proposition that a strong reputation may militate against a likelihood of confusion where there are differences between the marks under comparison. However, in the present case the marks are deceptively similar, there is in fact little difference between the marks, and in that circumstance we consider that Ms Hudson’s strong reputation in her name is more likely to enhance the likelihood of confusion, than reduce it.
We do not agree with the primary judge’s conclusion that a probable purchaser when faced with an item of clothing bearing Ms Taylor’s Mark (Katie Perry) would, on giving the matter a moment’s reflection, conclude that the clothes in question did not come from the same source as clothes bearing the Katy Perry Mark.
As with our consideration of s 60, we do not consider that the absence of any actual evidence of confusion is persuasive, where that absence is explicable by the small scale of use of Ms Taylor’s Mark over the 10 years since it was adopted.
For the same reasons as we came to a contrary conclusion to the primary judge in relation to s 60, we consider that as at the date that the cross-claim was commenced, consumers were likely to be deceived or confused, whether the comparison be the actual or notional use of Ms Taylor’s Mark. By the date the cross-claim was commenced, the reputation of Katy Perry and the Katy Perry Mark is stronger than for the s 60 consideration, given the passage of time and the increase of Ms Hudson’s international fame over that time.
9.5.1Discretion not to cancel for ground 4
Again, s 89 is engaged by reason of Ms Hudson’s success on the s 88(2)(c) ground. Accordingly, Ms Taylor must satisfy the threshold for s 89, in order to enliven the s 89 discretion not to grant an application for rectification of the Register. Ms Taylor relies on the same matters as before to enliven the discretion.
In addition to the factors set out at [313] above, Ms Taylor relies on the following additional factors in her appeal to the Court to exercise its discretion not to cancel her mark. In particular, Ms Taylor points to the assiduous infringing conduct of Ms Hudson and her companies, despite Ms Hudson’s knowledge of both Ms Taylor’s Mark, and Ms Taylor’s refusal to enter a co-existence agreement. From the date of the first pleaded use of the Katy Perry Mark, that use was infringing. Ms Taylor submits that Ms Hudson’s use was not honest concurrent use, and Ms Hudson should not be rewarded for “swamping” Ms Taylor’s earlier mark, in circumstances where Ms Taylor is entirely without blame.
As we observed above, Ms Taylor applied for her mark with knowledge of Ms Hudson, her reputation, and her mark in circumstances where she also knew that that popular music stars, such as Ms Hudson, lend their names (and trade marks) to be used in connection with clothes and sell merchandise at their concerts, and accepted such conduct as a common practice. Whilst not “blameworthy”, this conduct did contribute towards the s 88(2)(a) result, and for that reason we do not consider that the s 89 discretion is enlivened.
In the event that the s 89 discretion was enlivened, we do not consider that we could exercise the discretion not to remove Ms Taylor’s Mark from the Register for the reasons we explained in section 9.3.1 above.
Further, in the circumstances of this case, we do not consider that Ms Hudson’s conduct can be described as that of an “assiduous infringer”. Ms Hudson honestly adopted her name as a mark in the United States in 2002. After learning of Ms Taylor and her mark, Ms Hudson proposed a co-existence agreement which was rejected. At all times Mr Jensen did not consider there was any likelihood of any consumers being deceived or confused. There was no deliberate “swamping” of Ms Taylor’s Mark.
10. RELIEF (Appeal grounds 5, 6 and 7)
Before the primary judge, the appellants argued that, by reason of Ms Taylor’s laches, acquiescence and delay, the Court should exercise its discretion not to grant injunctive relief and should limit Ms Taylor’s entitlement to an account of profits (should she elect for that relief) (PJ at [802]).
The primary judge did not consider it to be appropriate to exercise her discretion in that way because the appellants had failed to establish when Ms Taylor first had knowledge of the infringing conduct (PJ at [823]). The primary judge reasoned that the failure to establish that fact meant that she was unable to ascertain the length of any delay and whether, as a result of that delay, the appellants were prejudiced.
By ground 5 of the appeal, the appellants contend that the primary judge erred in making that finding because, in their submission, the evidence did establish that Ms Taylor knew of the infringing conduct in 2009. In support of this ground, the appellants simply re-agitate the evidence before the primary judge with a view to securing a different outcome on appeal.
As to the question of damages, the primary judge was persuaded that the case before her warranted an award of additional damages under s 126(2) of the Trade Marks Act (PJ at [851]). In reaching that conclusion, her Honour had regard to a number of factors, including the fact that the appellants had failed to discharge their evidentiary onus, and could not establish that they believed that, at the time of the infringing conduct, they had an arguable defence to Ms Taylor’s claim (PJ at [838]–[850]).
By ground 6 of the appeal, the appellants contend that the primary judge erred in concluding that Ms Taylor was entitled to an award of additional damages. In support of that ground, the appellants, once again, simply re-agitate the evidence before the primary judge with a view to securing a different outcome on appeal.
By ground 7 of the appeal, the appellants challenge the scope of the injunction which the primary judge granted against Kitty Purry.
As we have found that Ms Taylor’s trade mark was not validly registered and that the Register should be rectified by cancelling its registration, the relief which the primary judge granted on 10 May 2023 in terms of Orders 1 to 5 cannot be sustained and should be set aside. Therefore, these grounds of appeal no longer arise and we do not propose to deal with them on a basis that is contrary to our finding that the registration of Ms Taylor’s trade mark is invalid.
11. APPROPRIATE FORM OF ORDERS/DISPOSITION
For these reasons, the appeal succeeds in part. Orders 1 to 5 made by the primary judge on 10 May 2023 will be set aside. The costs order made by the primary judge on 4 August 2023 will also be set aside given that the appellants’ cross-claim now succeeds and the respondent’s claim for trade mark infringement cannot succeed.
An order will be made that the Register be rectified by cancelling the registration of trade mark no. 1264671. We will grant a limited stay of that order so as to ensure that no change is made to the Register before the respondent is given the opportunity to apply for special leave to appeal to the High Court, should she be advised to do so.
The respondent has had limited success on her cross-appeal, but not such as to lead to any substantive relief. In the circumstances, the appropriate order for costs is that the respondent pay the appellants’ costs of the appeal and cross-appeal. As the primary judge’s order for costs of the proceeding below will be set aside, it will be necessary for that question to be re-determined. It is appropriate that that question be remitted to the primary judge for that purpose.
Orders will be made accordingly.
I certify that the preceding three hundred and fifty-five (355) numbered paragraphs are a true copy of the Reasons for Judgment of the Honourable Justices Yates, Burley and Rofe. Associate:
Dated: 22 November 2024
SCHEDULE OF PARTIES
NSD 547 of 2023 Appellants
Fourth Appellant:
PURRFECT VENTURES LLC
Cross-Respondents
Second Cross-Respondent
KATHERYN ELIZABETH HUDSON
Third Cross-Respondent
KITTY PURRY INC
Fourth Cross-Respondent
PURRFECT VENTURES LLC
Key Legal Topics
Areas of Law
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Intellectual Property Law
Legal Concepts
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Trade Mark Law
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Infringement
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Joint Tortfeasance
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Specification of Registered Goods
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Nice Agreement
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Defence to Infringement
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Concurrent Use
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Cancellation of Registration
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