FEDERAL COURT OF AUSTRALIA
Natural Raw C Pty Ltd v Maicap Pty Ltd [2023] FCA 51
File number: NSD 495 of 2022 Judgment of: NICHOLAS J Date of judgment: 3 February 2023 Catchwords: CONSUMER LAW – whether respondent engaged in conduct likely to mislead or deceive in the course of supplying packaged coconut water – whether packaging likely to lead ordinary and reasonable consumer to think that the respondent’s product was made by or with the permission of the applicant
CONTRACTS – whether applicant validly terminated a settlement agreement made between applicant and respondent following mediation – whether applicant precluded by settlement agreement from maintaining the proceeding
Legislation: Australian Consumer Law s 18 Cases cited: Australian Woollen Mills Ltd v FS Walton & Co Ltd (1937) 58 CLR 641
Butcher v Lachlan Elder Realty Pty Ltd (2004) 218 CLR 592
Campomar Sociedad Limitada v Nike International Limited (2000) 202 CLR 45
Codelfa Construction Pty Ltd v State Rail Authority of NSW (1982) 149 CLR 337
Francis Gregory Hannigan v Inghams Enterprises Pty Limited [2019] NSWSC 321
Gore v Australian Securities and Investment Commission [2017] FCAFC 13
Homart Pharmaceuticals Pty Ltd v Careline Australia Pty Ltd (2017) 349 ALR 598
Homart Pharmaceuticals Pty Ltd v Careline Australia Pty Ltd (2018) 264 FCR 422
Massoud v NRMA Insurance Ltd (1995) 62 NSWLR 657
Natural Waters of Viti Ltd v Dayals (Fiji) Artesian Waters Ltd (2007) 71 IPR 571
Pacific Carriers Ltd v BNP Paribas (2004) 218 CLR 451
Parkdale Custom Built Furniture Pty Ltd v Puxu Pty Ltd (1982) 149 CLR 191
Sanpine v Koompahtoo Local Aboriginal Land Council [2005] NSWSC 365
Sydneywide Distributors Pty Ltd v Red Bull Australia Pty Ltd (2002) 234 FCR 549
Taco Company of Australia Inc v Taco Bell Pty Ltd (1982) 42 ALR 177
Verrocchi v Direct Chemist Outlet Pty Ltd (2016) 247 FCR 570
Division: General Division Registry: New South Wales National Practice Area: Commercial and Corporations Sub-area: Regulator and Consumer Protection Number of paragraphs: 78 Date of last submissions: 23 December 2022 Date of hearing: 15 and 16 December 2022 Counsel for the Applicant: Mr MR Hall SC with Ms EE Whitby Solicitor for the Applicant: HWL Ebsworth Lawyers Counsel for the Respondent: Mr EJC Heerey KC with Mr AK Baillie Solicitor for the Respondent: Cowell Clarke Commercial Lawyers ORDERS
NSD 495 of 2022 BETWEEN: NATURAL RAW C PTY LTD ACN 160 678 419
Applicant
AND: MAICAP PTY LTD ACN 074 616 881
Respondent
ORDER MADE BY:
NICHOLAS J
DATE OF ORDER:
3 FEBRUARY 2023
THE COURT ORDERS THAT:
1.The amended originating application be dismissed.
2.Any party seeking a different costs order to that referred to in [77] of the reasons for judgment published today (“the Proposed Costs Order”) is to file a written submission (limited to 2 pages in length) within 5 days.
3.Any submission in answer (limited…
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- Case
- [2023] FCA 51
- Decision Date
CaseChat Overview and Summary
The primary legal issues were whether the respondent's packaging was likely to mislead or deceive consumers into believing the product was made by or with the permission of the applicant and whether the applicant could terminate the settlement agreement. The court examined evidence of consumer confusion and the similarity in packaging colours and styles. It considered whether the Australian Woollen Mills principle applied and whether the respondent's conduct was intended to mislead or deceive consumers.
The court found that the evidence of consumer confusion was not persuasive and that the similarities in packaging were attributable to the nature of the product and common packaging styles. The court did not accept that the respondent intended to appropriate the applicant's trade or reputation or to mislead consumers. The court concluded that the Australian Woollen Mills principle did not apply, and the respondent's conduct did not mislead or deceive consumers. Additionally, the court ruled that the applicant could not validly terminate the settlement agreement.
The court dismissed the amended originating application and ordered that any party seeking a different costs order must file a written submission within specified timeframes. If no submissions are filed, the court will make the proposed costs order without further hearing from the parties.
Orders
Orders of the court
1. The amended originating application be dismissed.
2. Any party seeking a different costs order to that referred to in [77] of the reasons for judgment published today (“the Proposed Costs Order”) is to file a written submission (limited to 2 pages in length) within 5 days.
3. Any submission in answer (limited to 2 pages in length) is to be filed within 7 days.
4. In the event any written submission is filed pursuant to order 2 then the question of costs will be dealt with on the papers.
5. In the event no written submission is filed pursuant to order 2 then the Court will make the Proposed Costs Order without hearing further from the parties.
Note: Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules 2011.
Background
Background to the litigation
Full text does not contain this section.
Evidence
Evidence Before The Court
Decision
Reasons for decision
Full text does not contain this section.
Ratio Decidendi
Legal Principle Established
The applicant ultimately submitted that the Court should find that on the balance of probabilities Ms D’Arcy used her visit to Coles to inform her understanding of the design process of the 2021 packaging, that she saw the applicants’ Raw C product and its packaging at that time, and that significant elements incorporated into her design on 29 March 2021 were derived from the impression she retained of the Raw C product. It further submitted that it was Ms D’Arcy’s “intention to take what was best of the current market practice, best at attracting customers and making her product stand out”. The applicant submitted that coupled with Ms D’Arcy’s borrowing of features from the same source (ie. the Raw C product), the AustralianWoollen Mills principle applies and that it should be presumed that the 2021 packaging was “… fit for purpose and would be likely to mislead or deceive”. Consideration I am not persuaded that the respondent adopted any part of its 2021 or 2022 packaging for the purpose of appropriating the trade or reputation of the applicant. In particular, I am not persuaded that the respondent adopted any part of such packaging with the intention of misleading or deceiving purchasers or potential purchasers of its products. Ms D’Arcy denied that she copied the packaging of the Raw C Coconut Water product. Although I am prepared to accept that she most likely saw that product on sale at Coles, and that it influenced her design of the 2021 packaging, I do not accept that she intentionally copied the applicant’s product or that she did so for the purpose of taking advantage of the applicant’s reputation or misleading consumers. On my view of the facts, the AustralianWoollen Mills principle does not apply. For reasons I have stated, the evidence of confusion relied on by the applicant is not persuasive. In determining whether the 2021 packaging is misleading or deceptive or likely to mislead or deceive the ordinary reasonable consumer into thinking that the respondent’s product is made by the applicant or with the applicant’s permission, I give that evidence no weight. Some important similarities in the relevant products are attributable to the nature of the product and the shape and style in which products like them are commonly packaged. As Bennett J explained in Natural Waters of Viti Ltd v Dayals (Fiji) Artesian Waters Ltd (2007) 71 IPR 571 at [46]:The fact that Natural Waters may establish reputation in the Fiji Water get-up does not mean that it has a monopoly over each aspect of that get-up. The goods are ordinary articles of consumption. By their nature, goods of different manufacturers will bear some resemblance to each other. Water is sold in bottles, frequently in transparent bottles and commonly with blue caps. The marks, brands and labels play an important part in distinguishing the goods of one manufacturer from those of another … Whether the reason for the distinctiveness of Fiji Water is one or more particular aspects of its packaging or the totality of its get-up, the offending product will only mislead or deceive consumers where it has taken the distinctive aspect(s) or so much of the totality of the get-up that the overall impression or the “gestalt” of the Fiji Water brand … is adopted. If Dayals adopted an aspect of the get-up for its product, that fact alone does not dictate a finding of passing off …(citations omitted)