Knight v Beyond Properties Pty Ltd (No 2)

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FEDERAL COURT OF AUSTRALIA

Knight v Beyond Properties Pty Ltd (No 2) [2006] FCA 192

PRACTICE AND PROCEDURE – parties – application for leave to join additional respondents – substantive application seeking relief in respect of alleged contraventions of s 52 of Trade Practices Act 1974 (Cth) and for passing off – allegation by applicant of reputation in Australia in connection with common law mark ‘mythbusters’ – existing claim relating to production of ‘mythbusters’ television series – proposed new claim relating to publishing of two ‘mythbusters’ books – no connection between publishers of books sought to be added as respondents, and existing respondents – issue of applicant’s reputation in Australia common to both television series claim and books claim – Federal Court Rules O 6 r 2 – whether rights to relief ‘are in respect of or arise out of the same transaction or series of transactions’.

Federal Court Rules O 6 r 2

Bishop v Bridgelands Securities Ltd (1990) ATPR–§41-060 cited
Payne v Young (1980) 145 CLR 609 cited

ANDREW KNIGHT v BEYOND PROPERTIES PTY LTD & ORS

NSD 131 of 2005

LINDGREN J
10 MARCH 2006
SYDNEY


IN THE FEDERAL COURT OF AUSTRALIA

NEW SOUTH WALES DISTRICT REGISTRY

NSD 131 OF 2005

BETWEEN:

ANDREW KNIGHT
APPLICANT

AND:

BEYOND PROPERTIES PTY LTD (ACN 002 861 458)
FIRST RESPONDENT

BEYOND INTERNATIONAL LTD (ACN 003 174 409)
SECOND RESPONDENT

DISCOVERY COMMUNICATIONS INC
THIRD RESPONDENT

SPECIAL BROADCASTING SERVICE CORPORATION (SBS) (ABN 91 314 398 574)
FOURTH RESPONDENT

FOXTEL MANAGEMENT PTY LTD (ACN 068 671 938)
FIFTH RESPONDENT

BEYOND PROPERTIES PTY LTD (ACN 002 861 458)
FIRST CROSS-CLAIMANT

BEYOND INTERNATIONAL LTD (ACN 003 174 409)
SECOND CROSS-CLAIMANT

ANDREW KNIGHT
CROSS RESPONDENT

JUDGE:

LINDGREN J

DATE OF ORDER:

10 MARCH 2006

WHERE MADE:

SYDNEY

THE COURT ORDERS THAT:

1.        Beyond Productions Pty Ltd be joined as sixth respondent.

2.In so far as the motion brought by the applicant by notice of motion filed on 2 February 2006 seeks leave to join Simon & Schuster Inc t/as Simon Spotlight Entertainment as seventh respondent, and John Wiley & Sons Inc as eighth respondent, the motion be dismissed.

3.The applicant have leave to file and serve a second further amended application and a further amended statement of claim.

4.The applicant pay the respondents’ costs of the motion.

Note:    Settlement and entry of orders is dealt with in Order 36 of the Federal Court Rules.


IN THE FEDERAL COURT OF AUSTRALIA

NEW SOUTH WALES DISTRICT REGISTRY

NSD 131 OF 2005

BETWEEN:

ANDREW KNIGHT
APPLICANT

AND:

BEYOND PROPERTIES PTY LTD (ACN 002 861 458)
FIRST RESPONDENT

BEYOND INTERNATIONAL LTD (ACN 003 174 409)
SECOND RESPONDENT

DISCOVERY COMMUNICATIONS INC
THIRD RESPONDENT

SPECIAL BROADCASTING SERVICE CORPORATION (SBS) (ABN 91 314 398 574)
FOURTH RESPONDENT

FOXTEL MANAGEMENT PTY LTD (ACN 068 671 938)
FIFTH RESPONDENT

BEYOND PROPERTIES PTY LTD (ACN 002 861 458)
FIRST CROSS-CLAIMANT

BEYOND INTERNATIONAL LTD (ACN 003 174 409)
SECOND CROSS-CLAIMANT

ANDREW KNIGHT
CROSS RESPONDENT

JUDGE:

LINDGREN J

DATE:

10 MARCH 2006

PLACE:

SYDNEY

REASONS FOR JUDGMENT (No 2)

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Details
Case
[2006] FCA 192
Decision Date

CaseChat Overview and Summary

Knight v Beyond Properties Pty Ltd (No 2) involves a dispute between Mr Knight, an internationally acclaimed writer, and several companies involved in the production and distribution of television programs, including Beyond, Discovery Communications Inc, Special Broadcasting Service Corporation, and Foxtel Management Pty Ltd. Mr Knight alleges that these companies have infringed his intellectual property rights by producing and distributing a television series called "mythbusters" without his authorisation. The dispute also extends to two publishers, S & S and Wiley, who have published books containing the word "mythbusters" in their titles without Mr Knight's permission. Mr Knight claims these actions constitute misrepresentations under the Trade Practices Act 1974 (Cth) and various forms of passing off.

The primary legal issues before the court were whether S & S and Wiley could be joined as respondents in the current proceedings and whether Mr Knight should be allowed to amend his statement of claim to include claims against them. The court considered whether the claims against S & S and Wiley were sufficiently related to the existing claims against the other respondents to warrant joinder under the relevant rules of court. The court also examined whether the joinder would cause significant inconvenience to the existing respondents and whether the claims against S & S and Wiley involved different factual and legal issues.

The court concluded that the motion to join S & S and Wiley should be dismissed. The court found that the factual and legal issues relating to the claims against S & S and Wiley were distinct from those in the existing proceedings, and the joinder would cause substantial inconvenience to the existing respondents. Furthermore, the court determined that the evidence did not support the claim that S & S and Wiley had published the books in Australia, which was a critical aspect of Mr Knight's claims. The court allowed Mr Knight to add Beyond Productions Pty Ltd as a sixth respondent and to file a further amended statement of claim, excluding the claims against S & S and Wiley.

The court's orders included joining Beyond Productions Pty Ltd as the sixth respondent, dismissing the motion to join S & S and Wiley, permitting Mr Knight to file a further amended statement of claim, and directing Mr Knight to pay the respondents' costs of the motion. The court's decision balanced the need for efficient use of judicial resources against Mr Knight's right to pursue his claims, ultimately finding that the joinder of S & S and Wiley was not warranted under the circumstances.

Orders

Orders of the court

1. Beyond Productions Pty Ltd be joined as sixth respondent.

2. In so far as the motion brought by the applicant by notice of motion filed on 2 February 2006 seeks leave to join Simon & Schuster Inc t/as Simon Spotlight Entertainment as seventh respondent, and John Wiley & Sons Inc as eighth respondent, the motion be dismissed.

3. The applicant have leave to file and serve a second further amended application and a further amended statement of claim.

4. The applicant pay the respondents’ costs of the motion.

Background

Background to the litigation

The existing five respondents, who are represented by the same firm of solicitors, Phillips Fox, oppose the joinder of S & S and Wiley.BACKGROUND The following account is based on the proposed further amended statement of claim and does not represent any finding of fact by me. Mr Knight’s allegations are as follows. Mr Knight, also known as ‘Bowvayne’, is an internationally acclaimed writer who is, and at all material times has been, involved in the writing of novels and the development of television programs. Beyond comprises three Australian companies that are involved in the production and distribution of television programs. The third respondent, Discovery Communications Inc (‘Discovery’), is a foreign corporation that carries on business as a distributor of television programs and pay television broadcaster, and operates the ‘Discovery Channel’ in Australia. The fourth respondent, the Special Broadcasting Service Corporation (‘SBS’), is a statutory corporation that carries on business as a national free-to-air television broadcaster. The fifth respondent, Foxtel Management Pty Ltd (‘Foxtel’), is an Australian company that carries on business as a pay television broadcaster. Since 1988, Mr Knight has continuously carried on, in Australia and internationally, a business of, inter alia, writing novels and developing, writing, producing and selling television programs all concerning the investigation of myths, under or by reference to the name and (common law) mark ‘mythbusters’. Mr Knight gives particulars of his reputation overseas and in Australia, and concludes that he has a valuable and substantial reputation in Australia and elsewhere in the name and mark ‘mythbusters’. Mr Knight promoted in Australia and elsewhere, including to Beyond, the concept of a series of half-hour television programs to be called ‘mythbusters’. Without Mr Knight’s authority, Beyond has produced, promoted and distributed a television series concerning the investigation of myths entitled ‘mythbusters’. In addition, Beyond has licensed, authorised or permitted Discovery, SBS and Foxtel to broadcast and promote, or to procure the broadcasting and promotion of, the series in Australia and elsewhere, and they have in fact done so. Mr Knight asserts that the conduct described has given rise to various misrepresentations in contravention of s 52 of the Trade Practices Act 1974 (Cth) (‘the TP Act’) and to various forms of passing off, by Beyond, Discovery, SBS and Foxtel. The motion to join S & S and Wiley arises from the alleged publication by them in Australia and elsewhere without his authority of two books which include the word ‘mythbusters’ in their titles: in S & S’s case the book, Mythbusters: the Explosive Truth Behind 30 of the Most Perplexing Urban Legends of All Time (‘the S & S book’), and in Wiley’s case the book Mythbusters: Don’t try this at home (‘the Wiley book’). Mr Knight claims that by doing so, S & S and Wiley have also made misrepresentations in contravention of s 52 of the TP Act and engaged in various forms of passing off.

Evidence

Evidence Before The Court

Full text does not contain this section.

Decision

Reasons for decision

LINDGREN J
I do not accept the submission. The question of the liability of S & S and Wiley for the alleged TP Act contraventions and for passing off raises factual and legal issues which are appropriately left to a final hearing. As I understood her, counsel for the respondents does not submit that S & S and Wiley do not carry on business within the Commonwealth and can not be served here: see FCR O 8 r 1(e). Generally speaking, the source, higher up the distribution chain, of an ‘instrument of deception’ is liable for passing off: see C Wadlow, The Law of Passing Off, Sweet & Maxwell, London, 1995 at 4.44 – 4.52 and cases there cited. On the evidence before me on this motion, I am not in a position to know with sufficient confidence that S & S and Wiley are excepted from this general principle.CONCLUSION In substance, the motion should be dismissed with costs. However, as noted earlier, Mr Knight will have leave by consent to add Beyond Productions Pty Ltd as sixth respondent. He will also have leave to file and serve a second further amended application and a further amended statement of claim. The permitted amendments will not include those proposed relating to claims against S & S and Wiley.If, contrary to present indications, it transpires that there will be sufficient evidentiary overlap between the two proceedings, it will be open to Mr Knight or any other party to move for an order that they be heard together.

Ratio Decidendi

Legal Principle Established

Established by: LINDGREN J

In fact, in Bishop v Bridgelands Securities Ltd (1990) ATPR–§41-060 Wilcox J held that para (b) was not limited by reference to para (a) of r 2. I respectfully agree. Nonetheless, the first inquiry will always be whether the terms of para (a) are satisfied. If so, the Court will proceed to consider discretionary factors of the kind mentioned above. If not, the Court may still be persuaded in the particular circumstances of the case to exercise the discretion by granting leave, as happened in Bishop v Bridgelands, above.CONSIDERATION Mr Knight could not have joined S & S and Wiley at the outset because the facts giving rise to his claims against them (the publishing of the two books) occurred subsequently. If a separate proceeding were brought by Mr Knight against S & S and Wiley, it appears that some common questions of law and fact would arise in that proceeding and the present proceeding (see para (i) of r 2(a)), namely, questions relating to Mr Knight’s reputation in Australia in connection with the name ‘mythbusters’. Apparently this will be a strongly contested issue in this proceeding. It may be, however, that even in relation to this issue, there would be differences between the two proceedings, one proceeding relating to Mr Knight’s reputation with television viewers and the other relating to his reputation with the buyers and readers of books. The rights to relief claimed in the two proceedings would clearly not be ‘in respect of or arise out of the same transaction or series of transactions’: cf Payne v Young (1980) 145 CLR 609. The evidentiary fields which would be covered by Mr Knight’s claim against Beyond, Discovery, SBS and Foxtel in connection with the television series, and that covered by his claim against S & S and Wiley in connection with publication of the two books, would, it seems, be quite different. The inconvenience to the two groups of respondents of having to participate in a hearing in which a substantial number of the issues and a substantial part of the evidence would be no concern of theirs, must be weighed against the inconvenience to Mr Knight of having to prove his reputation (or reputations) in separate proceedings. In my view, the weighing exercise favours the respondents. Mr Knight would not have been entitled under O 6 r 2 to join the publishers as respondents in this proceeding initially, and he should not be allowed to do so now. The respondents also oppose the joinder of S & S and Wiley on the basis that they did not publish the books in Australia. It is put that, on the evidence, they published the books in the United States of America and the books must have been imported into Australia by and from entities not related to S & S or Wiley. The respondents rely on a ‘Brand Licence Agreement’ between S & S and Discovery Licensing Inc, by which Discovery Licensing Inc granted to S & S the right to use certain trade names, trade marks, logos and copyrighted material of the Discovery Channel program ‘mythbusters’ to develop, publish, sell and distribute a ‘mythbusters’ fan book in the United States, its territories and possessions and Canada. According to an affidavit sworn 24 February 2006 of Emily Remes, Vice President and Deputy General Counsel of S & S, S & S has not been licensed the right to sell or authorise the sale of the S & S book or of any other ‘mythbusters’ fan book in Australia and has not done so.