Louis Vuitton Malletier SA v Design Elegance Pty Ltd

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FEDERAL COURT OF AUSTRALIA

Louis Vuitton Malletier SA v Design Elegance Pty Ltd [2006] FCA 83

CONTEMPT – whether breach of a court order constitutes civil or criminal contempt – whether imposition of a fine is an appropriate penalty – whether a claim for contempt may be the subject of an offer for settlement – whether an offer by a solicitor for the aggrieved party to settle or compromise conduct constituting trade-mark re-infringement and contempt involves impropriety when the offer seeks more than the aggrieved party has a legal right to claim in respect of the re-infringement – whether such impropriety should result in the Court exercising its discretion as to costs adversely to the aggrieved party notwithstanding that it has succeeded in its claim of contempt

SOLICITORS – consideration of the principles relevant to an offer by a solicitor for the aggrieved party to waive, settle or comprise a claim of contempt

Australian Meat Industry Employees’ Union v Mudginberri Station Pty Ltd (1986) 161 CLR 98 - cited
Witham v Holloway (1995) 183 CLR 525 - applied
Australian Competition and Consumer Commission v Leahy Petroleum Pty Ltd (No 2) (2005) 215 ALR 281 - cited
Construction, Forestry, Mining and Energy Union v BHP Steel (AIS) Pty Ltd (2003) 196 ALR 350 – cited
Rip Curl International Pty Ltd v Phone Lab Pty Ltd (2004) 63 IPR 496 – cited
John Fairfax & Sons Pty Ltd v McRae (1955) 93 CLR 351 - cited
Pojé v Attorney-General of British Columbia [1953] 1 SCR 516 – cited
Gompers v Buck Stove & Range Co 221 US 418 (1911) – cited
Attorney-General v Times Newspapers Ltd [1974] AC 273 - cited
Harman v Secretary of State for the Home Department [1983] AC 280 - cited
Kerridge v Simmonds (1906) 4 CLR 253 - cited

LOUIS VUITTON MALLETIER SA v DESIGN ELEGANCE PTY LTD AND BARBARA ANNE MASKIELL
VID 579 OF 2003

MERKEL J
14 FEBRUARY 2006
MELBOURNE


IN THE FEDERAL COURT OF AUSTRALIA

VICTORIA DISTRICT REGISTRY

VID 579 OF 2003

BETWEEN:

LOUIS VUITTON MALLETIER SA
APPLICANT

AND:

DESIGN ELEGANCE PTY LTD
ACN 083 361 755
FIRST RESPONDENT

BARBARA ANNE MASKIELL
SECOND RESPONDENT

JUDGE:

MERKEL J

DATE OF ORDER:

14 FEBRUARY 2006

WHERE MADE:

MELBOURNE

THE COURT DECLARES AND ORDERS THAT:

1.The first respondent is guilty of contempt by its conduct in breaching the consent order made by the Court on 8 September 2003.

2.The second respondent is guilty of contempt by her conduct in breaching the consent order made by the Court on 8 September 2003.

3.The first respondent shall pay a fine of $20 000 to the District Registrar of this Court within 2 months or such further time and by such instalments as the District Registrar may allow.

4.The second respondent shall pay a fine of $20 000 to the District Registrar of this Court within 2 months or such further time and by such instalments as the District Registrar may allow.

5.In the event that there is…

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Details
Case
[2006] FCA 83
Decision Date

CaseChat Overview and Summary

The parties involved in the case were Louis Vuitton Malletier SA, the plaintiff, and Design Elegance Pty Ltd, the defendant. The dispute arose from allegations of contempt related to a prior court proceeding, where Design Elegance was found to have infringed upon Louis Vuitton's trademark. The case was heard in the Federal Court of Australia.

The court was tasked with determining whether Louis Vuitton had misused its entitlement to threaten and bring contempt proceedings against Design Elegance. Specifically, the court needed to decide if Louis Vuitton had acted in bad faith by attempting to compromise the contempt claim through correspondence drafted by their solicitor. The court also had to consider the appropriate penalty for Design Elegance and the allocation of costs associated with the contempt proceedings.

The court found that the correspondence drafted by Louis Vuitton's solicitor, although not explicitly intended to offer a compromise, nonetheless conveyed such an offer. Given that the correspondence was sent on Louis Vuitton's instructions, the court held that Louis Vuitton should bear the consequences of the content of the correspondence. The court imposed a penalty of $20,000 on each of the respondents, Design Elegance, and ordered that Louis Vuitton bear its own costs for the contempt proceeding. Additionally, Louis Vuitton was required to pay the costs of counsel and solicitors acting pro bono for the respondents, in relation to specific charges and the misuse of contempt proceedings.

In conclusion, the court's decision emphasised the importance of the content of legal correspondence over the intent of the sender. The penalty and cost orders reflected the court's view that Louis Vuitton misused its right to bring contempt proceedings and that the costs associated with this misuse should be borne by Louis Vuitton.

Orders

Orders of the court

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Background

Background to the litigation

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Evidence

Evidence Before The Court

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Decision

Reasons for decision

MERKEL J
I would add that the solicitor responsible for drafting the correspondence (under the supervision of a partner) gave evidence that he didn’t intend to offer to compromise the contempt claim. While I accept that the solicitor may not have specifically turned his mind to that question, I have acted on the basis of the content of the correspondence, rather than on the basis of the solicitor’s recall of his intent when he was drafting the correspondence. In any event, the correspondence was sent on the instructions of Louis Vuitton. In the circumstances, it is appropriate that Louis Vuitton bear the burden of the costs orders.Conclusion In the result, I propose to impose a penalty of $20 000 on each of the respondents and order that Louis Vuitton bear its own costs of the contempt proceeding. Louis Vuitton is also to pay the costs of counsel and solicitors acting pro bono for the respondents, in so far as those costs are in connection with charges 3(a), (b) and (c) and with the issue of whether Louis Vuitton misused its entitlement to threaten and bring contempt proceeding in the present matter.

Ratio Decidendi

Legal Principle Established

Established by: MERKEL J

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