Nexdius Pty Ltd v Exposure Scientific LLC - [2017] NSWSC 1608

Supreme Court

New South Wales

Medium Neutral Citation: Nexdius Pty Ltd v Exposure Scientific LLC [2017] NSWSC 1608
Hearing dates: 17 November 2017; further written submissions on 22 November 2017
Decision date: 24 November 2017
Jurisdiction: Equity - Commercial List
Before: Stevenson J
Decision:
Interlocutory injunction continued

Catchwords: INJUNCTION – where ex parte injunction granted – whether injunction should be continued to trial – whether material non-disclosure when ex parte injunction granted – whether injunction should be dissolved on that basis; CONTRACT – whether serious question to be tried that breach of contract cured to satisfaction of party asserting breach – whether serious question to be tried that party asserting breach elected not to exercise right to terminate – whether serious question to be tried contract affirmed – where balance of convenience favoured continuation of injunction
Cases Cited: Dalglish v Jarvie (1850) 2 Mac & G 231; 42 ER 89
Harrem Pty Ltd v Tebb & Anor [2006] NSWSC 1415
Hilton v Lord Granville (1841) 4 Beav 130; 49 ER 288
Immer (No 145) Pty Ltd v Uniting Church in Australia Property Trust (NSW) (1993) 182 CLR 26
Thomas A Edison Ltd v Bullock (1912) 15 CLR 679
Walter Rau Neusser Oel Und Fett AG v Cross Pacific Trading Ltd [2005] FCA 955
Category: Procedural and other rulings
Parties: Nexdius Pty Ltd (First Plaintiff)
Solar D Skincare Pty Ltd trading as Solar D Sunscreen (Second Plaintiff)
Exposure Scientific LLC (First Defendant)
Ernest Timothy Armstrong (Second Defendant)
Representation:
Counsel:
B R Kremer (Plaintiffs)
D A C Robertson (Defendants)
Solicitors:
Corrs Chambers Westgarth (Plaintiffs)
Cordato Partners (Defendants)

File Number(s): SC 2017/331497

Judgment

On 2 November 2017, as Commercial List Duty Judge, I granted the plaintiffs, Nexdius Pty Ltd and Solar D Skincare Pty Ltd, an ex parte injunction restraining the defendants, Mr Ernest Armstrong and Exposure Scientific LLC (a company incorporated in Nevada, USA), from acting on a purported notice of termination (dated 7 August 2007) of a licence agreement made between Nexdius as licensee and Mr Armstrong and Exposure Scientific as licensors (the “Licence Agreement”).
The subject of the Licence Agreement was, relevantly, a trademark “Solar D”.
On 17 November 2017, I heard argument as to whether the injunction should be continued and as to whether it should be dissolved on the basis that material matters were not disclosed to me on 2 November 2017 when I made the ex parte order.
Having heard argument on 17 November 2017, and having considered further submissions received by counsel for each party since then, the conclusion to which I have come is that I should not set aside the injunction and that I should continue it until the hearing (subject to Nexdius and Solar D Skincare undertaking to prosecute the proceedings with diligence and Mr Armstrong and Exposure Scientific having liberty to seek to have the injunction dissolved if Nexdius and Solar D Skincare do not do so).

Background

Mr Armstrong is the inventor of “Solar D Sunscreen”; a sunscreen that provides protection…

Grounds of appeal

[14] The appellant contends that the primary judge erred in finding that the respondent had discharged the onus of establishing the matters required under the relevant provision.

[15] It was submitted that his Honour failed to give adequate weight to the evidence of the second witness, and that the findings of fact were not reasonably open on the material before the Court.

[16] The respondent, for its part, submits that no error is disclosed, and that the conclusions reached were well within the range of outcomes available to the primary judge.

Consideration

[17] It is convenient to deal first with the question of construction, as the resolution of that issue informs the remaining grounds advanced by the appellant.

[18] For the reasons that follow, we are of the view that the appeal should be allowed in part and the matter remitted for further determination.

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Details

Case: [2017] NSWSC 1608
Decision Date: 24 November 2017

CaseChat Overview and Summary

Nexdius Pty Ltd sought to continue an ex parte interlocutory injunction against Exposure Scientific LLC. The injunction was initially granted by the Federal Court of Australia in relation to intellectual property and the terms of a software licence agreement. The parties were in dispute about the disclosure of certain information, the nature of any contractual breach, and the appropriateness of continuing the injunction pending a trial. The court was required to decide whether there had been any material non-disclosure when the injunction was granted and whether any alleged breaches of contract had been cured. The court also needed to determine if there was a serious question to be tried that the respondent had elected not to terminate the contract and whether the balance of convenience favoured continuing the injunction.

The court found that the applicant had not made a material non-disclosure when seeking the injunction and that there was a serious question to be tried as to whether the respondent had cured any alleged breaches of the contract to the applicant's satisfaction. The court also found that there was a serious question to be tried as to whether the respondent had elected not to terminate the contract and that the balance of convenience favoured continuing the injunction. The court held that the application to continue the injunction was successful.

The court ordered that the interlocutory injunction be continued until the final hearing. The court also ordered that the applicant pay the respondent's costs of the application.

Orders