Schütz GmbH and Co KGaA v VIP Plastic Packaging Pty Ltd
[2013] FCA 424
FEDERAL COURT OF AUSTRALIA
Schütz GMBH & Co KGAA v VIP Plastic Packaging Pty Ltd [2013] FCA 424
Citation: Schütz GMBH & Co KGAA v VIP Plastic Packaging Pty Ltd [2013] FCA 424 Parties: SCHÜTZ GMBH & CO KGAA and SCHÜTZ AUSTRALIA PTY LTD (ACN 009 069 907) v VIP PLASTIC PACKAGING PTY LTD (ACN 095 313 705), VIP STEEL PACKAGING (ACN 095 314 195) and PACT GROUP PTY LTD (ACN 107 959 900) File number: WAD 17 of 2013 Judge: MCKERRACHER J Date of judgment: 26 April 2013 Legislation: Trade Marks Act 1995 (Cth) ss 121, 126
Federal Court of Australia Practice Note CM8
Date of hearing: 26 April 2013 Place: Perth Division: GENERAL DIVISION Category: No catchwords Number of paragraphs: 30 Counsel for the Applicant: Mr M L Bennett with Mr E Heerey Solicitor for the Applicant: Bennett + Co Counsel for the Respondent: Mr J Hennessy SC Solicitor for the Respondent: Gilbert + Tobin
IN THE FEDERAL COURT OF AUSTRALIA
WESTERN AUSTRALIA DISTRICT REGISTRY
GENERAL DIVISION
WAD 17 of 2013
BETWEEN: SCHÜTZ GMBH & CO KGAA
First ApplicantSCHÜTZ AUSTRALIA PTY LTD (ACN 009 069 907)
Second ApplicantAND: VIP PLASTIC PACKAGING PTY LTD (ACN 095 313 705)
First RespondentVIP STEEL PACKAGING (ACN 095 314 195)
Second RespondentPACT GROUP PTY LTD (ACN 107 959 900)
Third Respondent
JUDGE:
MCKERRACHER J
DATE OF ORDER:
26 APRIL 2013
WHERE MADE:
PERTH
THE COURT ORDERS THAT:
1.The proceedings no longer be conducted in accordance with the fast track list directions but continue on pleadings.
2.A further directions hearing by telephone be listed on Monday, 29 April 2013 at 4:15 pm (EST).
3.The costs of today be reserved.
Note:Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules 2011
IN THE FEDERAL COURT OF AUSTRALIA
WESTERN AUSTRALIA DISTRICT REGISTRY
GENERAL DIVISION
WAD 17 of 2013
BETWEEN: SCHÜTZ GMBH & CO KGAA
First ApplicantSCHÜTZ AUSTRALIA PTY LTD (ACN 009 069 907)
Second ApplicantAND: VIP PLASTIC PACKAGING PTY LTD (ACN 095 313 705)
First RespondentVIP STEEL PACKAGING (ACN 095 314 195)
Second RespondentPACT GROUP PTY LTD (ACN 107 959 900)
Third Respondent
JUDGE:
MCKERRACHER J
DATE:
26 APRIL 2013
PLACE:
PERTH
REASONS FOR JUDGMENT
INTRODUCTION
By originating application dated 14 February 2013, the applicants (to whom I will refer collectively as Schütz) instituted proceedings under the fast track provisions of this Court’s rules. The respondents (collectively, VIP) filed a Notice of Objection on 1 March 2013 to fast track directions. Since then the parties have filed detailed affidavits and submissions going to the question of whether or not the matter should be in the fast track list. Upon hearing the contested oral application on that issue, I indicated that the matter should not continue in the fast track list. I ordered that it should continue on pleadings in accordance with Practice Note CM8, para 2.5. My reasons follow.
BACKGROUND
The essential element of this dispute is that it is to be seen in the context of major litigation between these parties, which has been ensuing for some years at considerable expense. There have been some 19 published interlocutory judgments and the matter is fixed for a seven week trial in two tranches later in the year. This particular line of attack by Schütz appears to have been something of an afterthought but one which it says would put paid to the entire dispute if Schütz is successful. In my view, it is much too late, given the matters to which I refer to below, to admit this small, but new, aspect of the dispute to a separate resolution in the fast track list.
THE ESSENCE OF THIS DISPUTE
The essence of this dispute, as revealed from the fast track statement filed by Schütz, is a contention by Schütz that VIP has infringed the registered trade mark SCHÜTZ under s 121 of the Trade Marks Act 1995 (Cth) (the TMA) by breaching one or more terms of a Prohibition Notice which Schütz has caused to be displayed on their goods. The fast track statement continues:
Issues that the applicants believe are likely to arise in the proceeding
2.This proceding is likely to be the first time any court has considered s 121 of [the TMA] in any detail. From correspondence between the parties, it appears that the substantive facts are not disputed and the likely issues in the proceeding will be confined to the proper construction of s 121 of the TMA and the terms of the applicants’ Prohibition Notice. The applicants seek only injunctive relief; they do not seek damages or an account of profits.
The applicants’ contentions
The applicants and the SCHÜTZ Trade Mark
3. The first applicant is and has been at all material times:
3.1duly incorporated in the Federal Republic of Germany and capable of suing;
3.2the owner of Australian Trade Mark number 766911 for the word SCHÜTZ, which is registered with effect since 9 July 1998 in respect of goods including transport and storage containers of metal, pipes of metal, transport and storage containers of plastic, flexible transport and storage containers of plastic fabric (Schütz Trade Mark);
3.3the parent company of a worldwide group of companies (Schütz Group) which carries on the business of manufacturing, advertising, supplying and selling packaging and containers, including intermediate bulk containers (IBCs) under the Schütz Trade Mark, for use in the storage and transport of goods (Schütz Business).
4. The second applicant is and has been at all material times:
4.1duly incorporated in Australia and capable of suing;
4.2an authorised user of the Schütz Trade Mark;
4.3a member of the Schütz Group involved in the Schütz Business.
5The type of IBC so marketed by the applicants comprises a SCHÜTZ plastic container inside a SCHÜTZ metal transport and storage container bearing a UN certification label (which also includes the word SCHÜTZ) pursuant to the Australian Code for the Transport of Dangerous Goods by Road and Rail.
The applicants’ Prohibition Notice
6.Since about mid-August 2011, the applicants have affixed an adhesive notice to each IBC manufactured by them for use in Australia, which causes the following notice to be displayed for the purposes of s 121 of the TMA (the Prohibition Notice):
IMPORTANT NOTICE TO ALL USERS IN AUSTRALIA
This product is originally offered to the public as comprising a SCHÜTZ plastic container inside a SCHÜTZ metal transport and storage container bearing a UN certification label pursuant to the Australian Code for the Transport of Dangerous Goods by Road and Rail.
Take notice that Schütz GmbH & Co. KGaA, as owner of the Australian registered trade mark SCHÜTZ (no. 766911), hereby prohibits each of the following acts in Australia:
1applying another container manufacturer’s trade mark to this metal transport and storage container;
2using another container manufacturer’s trade mark in physical relation to this metal transport and storage container;
3altering, or partially removing or obliterating any representation of the trade mark SCHÜTZ applied to this metal transport and storage container; and
4using the trade mark SCHÜTZ in physical relation to this metal transport and storage container, after it has been altered from the state or condition in which it was originally offered to the public, including by:
a.removing the UN certification label attached to this metal transport and storage container; or
b.replacing the SCHÜTZ plastic container with a non-SCHÜTZ plastic container
Any person who does any of these prohibited acts or authorises such acts to be done will infringe Australian registered trade mark no. 766911.
7.Each of terms 1 and 2 of the Prohibition Notice identifies a prohibited act within the terms of s 121(2)(d) of the TMA.
8.Term 3 of the Prohibition Notice identifies a prohibited act within the terms of s 121(2)(b) of the TMA.
9.Term 4 of the Prohibition Notice identifies a prohibited act within the terms of s 121(2)(a) of the TMA.
The respondents and their cross-bottling practice
10.The respondents are and have been at all material times:
10.1companies duly incorporated in Australia and able to be sued; and
10.2carrying on the business in Australia of advertising, supplying and selling IBCs for use in the storage and transport of goods.
11The third respondent is the holding company and sole shareholder of each of the first and second respondents.
12The third respondent is and has been since 22 February 2007 the registered owner of Australian trade mark registration number 1162428 for VIP in respect of goods including:
12.1metal containers and other metal packaging including metal pallets and metal palletised crates and other structures for supporting intermediate bulk containers; and
12.2plastic and other non-metal packaging, including containers, intermediate bulk containers and bottles.
13At all material times, the respondents’ business has included a practice described as ‘cross-bottling’ IBCs, which involves the following steps (the Respondents’ Cross-Bottling Practice):
13.1acquiring a used SCHÜTZ IBC originally made by the Schütz Group;
13.2removing the SCHÜTZ plastic container from such a SCHÜTZ IBC;
13.3removing the UN certification label attached to the metal transport and storage container;
13.4inserting inside the SCHÜTZ metal transport and storage container a plastic container:
13.4.1which is not made or authorised by the applicants; and
13.4.2to which the trade marks VIP and/or MAUSER have been applied;
13.5applying to the SCHÜTZ metal transport and storage container adhesive notices displaying the trade mark VIP; and
13.6selling the resultant cross-bottled IBCs with the trade mark SCHÜTZ still applied to the metal transport and storage container.
14By a letter dated 9 September 2011 from the applicants’ solicitors to the respondents’ solicitors, the applicants put the respondents on notice that:
14.1the applicants were affixing the Prohibition Notice to IBCs manufactured by the applicants for use in Australia;
14.2the Respondents’ Cross-Bottling Practice would breach the terms of the Prohibition Notice if conducted on SCHÜTZ IBCs bearing the Prohibition Notice; and
14.3such conduct would infringe the Schütz Trade Mark under s 121 of the TMA.
The respondents’ breach of the terms of the Prohibition Notice
15From a time presently unknown to the applicants but at least from about September 2012, the respondents have conducted the Respondents’ Cross-Bottling Practice on SCHÜTZ IBCs which display the Prohibition Notice.
16Such conduct by the respondents amounts to doing or authorising the doing of one or more of the following acts prohibited by the Prohibition Notice:
16.1applying another container manufacturer’s trade mark (namely, VIP) to the SCHÜTZ metal transport and storage container, by applying adhesive notices displaying the trade mark VIP, in breach of term 1 of the Prohibition Notice; and/or
16.2using another container manufacturer’s trade mark (namely, VIP) in physical relation to the SCHÜTZ metal transport and storage container, by applying adhesive notices displaying the trade mark VIP to the SCHÜTZ metal transport and storage container and selling the resultant cross-bottled IBC, in breach of term 2 of the Prohibition Notice; and/or
16.3using another container manufacturer’s trade mark (namely, VIP and/or MAUSER) in physical relation to the SCHÜTZ metal transport and storage container, by inserting inside the SCHÜTZ metal transport and storage container a plastic container to which the trade marks VIP and/or MAUSER have been applied and selling the resultant cross-bottled IBC, in breach of term 2 of the Prohibition Notice; and/or
16.4altering, or partially removing or obliterating any representation of the trade mark SCHÜTZ applied to the SCHÜTZ metal transport and storage container, by removing the UN dangerous goods certification label (which includes the word SCHÜTZ) from the label plate of the SCHÜTZ metal transport and storage container, in breach of term 3 of the Prohibition Notice; and/or
16.5altering, or partially removing or obliterating any representation of the trade mark SCHÜTZ applied to the SCHÜTZ metal transport and storage container, by removing or painting over all or part of the Prohibition Notice (which includes the word SCHÜTZ) from the label plate of the SCHÜTZ metal transport and storage container, in breach of term 3 of the Prohibition Notice; and/or
16.6using the trade mark SCHÜTZ in physical relation to the Schütz metal transport and storage container, after the container has been altered from the state or condition in which it was originally offered to the public, by removing the UN certification label attached to the SCHÜTZ metal transport and storage container and selling the resultant cross-bottled IBC, in breach of term 4 of the Prohibition Notice; and/or
16.7using the trade mark SCHÜTZ in physical relation to the Schütz metal transport and storage container, after the container has been altered from the state or condition in which it was originally offered to the public, by replacing the SCHÜTZ plastic container with a non-SCHÜTZ plastic container and selling the resultant cross-bottled IBC, in breach of term 4 of the Prohibition Notice.
Particulars of infringement
Cross-bottled IBCs supplied by the respondents directly or indirectly to Porter Paints comprising SCHÜTZ metal transport and storage containers with a UN certification code 31HA1/Y/0912/AUS/VIP/30993/5550/2059/1054L/57kg/100kPa affixed and adhesive labels bearing the trade mark VIP and the handwritten date ‘25.10.2012’ affixed, and a non-SCHÜTZ plastic container embossed with the trade mark VIP and a clock device showing ‘09/12’ to indicate manufacture in September 2012. These IBCs may be inspected by appointment.
17In the circumstances, the respondents’ conduct set out in the above paragraph constitutes an infringement of the Schütz Trade Mark under s 121 of the TMA.
Relief claimed
18The applicants claim:
18.1Pursuant to s 126 of the TMA, an injunction permanently restraining the respondents from doing or authorising the doing of any of the acts set out in paragraph 16 above;
18.2such further or other order as to this Honourable Court may seem just; and
18.3costs.
THE HISTORY OF DISPUTATION IN THE MAIN PROCEEDINGS
This fast track application comes against a background of very extensive litigation between the parties in WAD 136 of 2009 (the main proceedings). Those proceedings have been on foot for over three and a half years. They were commenced by an ex parte application in 2009 for injunctive relief based on alleged breaches of the Trade Practices Act 1974 (Cth) (TPA) and a stated threat to public safety in order to prevent VIP from conducting the business of cross-bottling IBCs. At the hearing of the interlocutory application for an injunction on 27 August 2009, VIP offered certain undertakings to the Court in relation to IBCs for dangerous goods (DG IBCs) and to otherwise affix a label to any cross-bottled Schütz IBCs sold for non-dangerous goods non-DG IBCs). In addition, VIP agreed to remove any marking from the IBCs which signified that they were certified for use in the transport of dangerous goods (UN labels). On the basis of those undertakings, I dismissed the claim by Schütz for injunctive relief on 6 October 2009.
On the following day, Schütz filed a Statement of Claim alleging an infringement of Australian patent No 686500 in addition to trademark infringement and TPA claims. There have been six versions of the Schütz Statement of Claim since that time with emerging focus on the patent claims.
On 13 October 2010, I released VIP from its undertaking not to cross-bottle DG IBCs on the basis of a substituted undertaking, which required VIP to affix, to all IBCs cross-bottled by them, a label which indicated that the IBC had not been certified or approved for use by Schütz. That undertaking also required VIP to remove UN labels from any DG IBCs. That is the undertaking that remains in force as at this date.
Since that time, VIP has continued the practice of cross-bottling IBCs in conformity with undertakings the subject of orders made on 13 October 2010.
The parties each gave extensive discovery and filed extensive evidence. The main proceedings were initially set down for a seven week trial commencing on 3 June 2013 for two weeks and on 5 August 2013 for five weeks. It was necessary to vacate those trial orders earlier in the year. The trial has now been listed to commence for five weeks from 5 August 2013 and an additional two weeks from 21 October 2013 with orders that the parties conduct a further mediation of the dispute by 20 June 2013. I have been informed that the parties have arranged for a private mediation to be conducted on 4 June 2013.
The evidence discloses that the issues canvassed in the fast track proceedings were first raised in September 2011. At that time, solicitors for Schütz wrote to VIP’s solicitors alleging that the cross-bottling practice by VIP contravened the terms of a notice applied to Schütz IBCs. Schütz claimed that the notice was a prohibition notice for the purpose of s 121 of the TMA. That provision is in the following terms:
121Infringement of trade mark by breach of certain restrictions
(1)This section applies to a registered trade mark if the registered owner, or an authorised user of the trade mark having power to do so, has caused to be displayed on goods (registered goods) in respect of which the trade mark is registered, or on their package, or on the container in which they are offered to the public, a notice (notice of prohibition) prohibiting any acat that is under subsection (2) a prohibited act in relation to the goods.
…
(2)Each of the following is a prohibited act:
(a)applying the trade mark to registered goods, or using the trade mark in physical relation to them, after the state, condition, get‑up or packaging in which they were originally offered to the public has been altered.
(b)altering, or partially removing or obliterating, any representation of the trade mark applied to registered goods or used in physical relation to them;
(c)if the trade mark has been applied to registered goods, or used in physical relation to them, together with other matter indicating that the registered owner or authorised user has dealt with the goods‑‑removing or obliterating, totally or in part, any representation of the trade mark without totally removing or obliterating the other matter;
(d)applying another trade mark to registered goods or using another trade mark in physical relation to them;
(e)if the trade mark has been applied to registered goods or used in physical relation to them—using on the goods, or on the packaging or container of the goods, any matter that is likely to injure the reputation of the trade mark.
…
(3)Subject to subsection (4), a person infringes a trade mark to which this section applies if the person:
(a)is the owner of registered goods; and
(b)in the course of trade, or with a view to a dealing with the goods in the course of trade:
(i)does an act that is prohibited under the notice of prohibition; or
(ii)authorises that act to be done.
...
Thereafter, in correspondence in September 2011, Schütz sought undertakings from VIP that it would not engage in conduct prohibited by the notice. Compliance with this undertaking would have effectively precluded VIP from conducting its cross-bottling activities.
VIP has consistently refused to provide such undertakings on the basis that, to do so would require it to breach the orders made by the Court in the main proceedings and would put it in breach of the Australian Dangerous Goods Code (ADG Code).
In more recent correspondence from Schütz in March 2013, its solicitors contend that any conflict between the orders made in the main proceedings and the requirements of the ADG Code on the one hand and the relief sought in the fast track proceeding on the other, could be avoided if VIP ceases its cross-bottling activities. There is little doubt that this is the objective which Schütz seeks to attain.
Schütz indicated that it would seek to further amend its pleadings in the main proceeding if undertakings were not given. It failed to do so, however, nor did it seek to re-agitate its request for undertakings until some 18 months later.
During this period, Schütz took a number of steps in the main proceedings which appeared to arise out of similar factual circumstances. It issued a Notice to Admit on 21 November 2012 seeking admissions in relation to conduct alleged to be in breach of the Notice. It also served an affidavit of Mr Banks, sworn on 7 December 2012 alleging VIP had performed certain acts in relation to Porter Paints’ IBCs (Paints’ IBCs) in breach of the notice. VIP points to the fact that those steps were taken notwithstanding that the s 121 claim had never been pleaded in the main proceedings. VIP disputed the facts in the Notice to Admit and has challenged the admissibility of the Banks affidavit on the basis that the claim under s 121 has no place in the main proceedings.
On 6 February 2013, some 18 months after first raising the issue, Schütz reiterated its demand that VIP provide undertakings in similar form to those sought on 9 September 2011 and threatened to file proceedings if such undertaking were not provided within two days. Once again, VIP declined to provide the undertakings for the same reasons given in its earlier response. Subsequently Schütz commenced these proceedings as indicated, on 14 February 2013, supported by an affidavit sworn by Mr Banks on 14 February 2013.
Schütz has now advanced the argument that there is merit in pursuing this proceeding as it would have the effect of avoiding the need to continue with the main proceeding if Schütz were to succeed. That, in turn, is dependent upon a hearing and determination of the proceeding occurring at dates which would precede much activity in the main proceeding. Given the very substantial activity in the main proceeding, there is little likelihood of that occurring. Certainly, the Court’s commitments would not enable a five day hearing if the hearing of this matter could be reduced to a five day hearing to be conducted before the third week of July. No steps have been taken in the main proceeding to seek to stay any aspect of it in favour of pursuing this fast track proceeding.
THE BASIS OF THE OBJECTION TO ADMISSION TO THE FAST TRACK LIST
VIP’s grounds of objection to fast track directions being made can be stated succinctly in the following categories:
Novel proceeding
The parties accept, as noted in the fast track statement, that the Court will be required to consider s 121 of the TMA for the first time. The interpretation of that section will involve the proper construction of the section, including by reference to extrinsic material, the determination of the scope of protection intended by the section and application of the section to the facts of this case.
Implications of relief
VIP argues that there are potentially far-reaching ramifications flowing from the interpretation contended for by Schütz. On that interpretation a trade mark owner could impose and enforce conditions on all downstream sales of its goods, including any sales of second-hand goods.
Potential conflict with Court orders and legislation
VIP complains that the proceedings are likely to raise additional, complicated questions of law as to whether the relief sought by Schütz is available in circumstances where it conflicts with relief sought by Schütz and granted by the Court in the main proceedings between the parties and legislation that applies to the activities of both Schütz and VIP in relation to the storage and transport of dangerous goods. VIP contends that this would result in an adverse outcome.
Contested facts
VIP argues that contrary to the fast track statement the substantive facts are disputed and there is likely to be a significant contest in the proceedings that would have impact on the evidence the parties would lead, and the manner in which the Court would need to resolve such contest. VIP contends that expert evidence would be required.
The cause ought to proceed on pleadings
VIP submits that in the circumstances described in the preceding paragraphs, including the complex legal questions that arise, the matter is one that should proceed by way of pleadings, rather than in accordance with the directions applicable to a fast track matter.
The trial will exceed five days
VIP contends that the trial will not be completed within five days and will be more likely to take approximately 10 days.
Fast track response
VIP supports those objections with the following issues in its fast track response filed on 18 March 2013:
Nature of the dispute
1.This dispute concerns:
(a)the proper construction of s121 of the Trade Marks Act 1995 (1995) (TMA);
(b)whether the respondents have infringed the second applicant’s registered Australian Trade Mark Number 766911 under s121 of the TMA by the specific activities alleged; and
(c) whether the applicants are entitled to any injunctive relief.
Issues likely to arise
2The respondents contend that the following issues are likely to arise:
(a)the appropriate construction of s121 of the TMA and the scope of protection provided by the section, including in light of the history of s121, the equivalent progenitor provision in the (now repealed) Trade Marks Act 1938 (UK);
(b)whether the respondents have engaged in any of the activities described in paragraph 16 of the Fast Track Statement which facts are in dispute contrary to paragraph 2 of the Fast Track Statement.
(c)whether any activities engaged in by the respondents were or are prohibited by the terms of the applicants’ notice;
(d)whether the acts prohibited in the applicants’ notice are within the terms of s121 of the TMA;
(e)whether the respondents have infringed Australian Trade Mark Number 766911 under s121 of the TMA;
(f)whether the orders sought and obtained by the applicants, and the final relief they seek in proceeding No WAD 136 of 2009 disentitles them to relief sought in these proceedings; and
(g)whether any conduct engaged in pursuant to the Australian Dangerous Goods Code for the Transport of Dangerous Goods by Road and Rail amounts to an infringement within the meaning of s121 of the TMA.
Respondents’ response to contentions
The applicants and the Schütz trade mark
3The respondents admit the allegations in paragraph 3 of the Fast Track Statement, excluding the allegation in paragraph 3.2, which is not admitted.
4The respondents admit the allegations in paragraph 4 of the Fast Track Statement, excluding the allegation in paragraph 4.2, which is not admitted.
5The respondents deny the allegation in paragraph 5 of the Fast Track Statement.
The applicants’ notice
6The respondents admit that the applicants have affixed a notice in the form appearing at paragraph 6 of the Fast Track Statement to at least some IBCs manufactured by them for use in Australia but otherwise deny the allegations in paragraph 6.
7The respondents do not admit the allegations in paragraph 7 of the Fast Track Statement.
8The respondents do not admit the allegations in paragraph 8 of the Fast Track Statement.
9The respondents deny the allegations in paragraph 9 of the Fast Track Statement.
The respondents and their cross-bottling practice
10The respondents admit the allegations in paragraph 10 of the Fast Track Statement.
11The respondents admit the allegations in paragraph 11 of the Fast Track Statement.
12The respondents admit the allegations in paragraph 12 of the Fast Track Statement.
13The respondents admit the allegations in paragraph 13 of the Fast Track Statement.
14The respondents admit that the applicants’ solicitors sent a letter to the respondents’ solicitors dated 9 September 2011 containing allegations regarding their notice, as alleged in paragraph 14 of the Fast Track Statement, but rely on the contents of that letter.
The respondents’ breach of the terms of the notice
15The respondents deny the allegations in paragraph 15 of the Fast Track Statement.
16The respondents deny the allegations in paragraph 16 of the Fast Track Statement.
17The respondents deny the allegation in paragraph 17 of the Fast Track Statement.
Relief Claimed
18The respondents oppose the relief sought by the applicants on the basis, inter alia, that:
(a)the respondents have not infringed the second applicant’s Australian Trade Mark Number 766911 under s121 of the TMA;
(b)even if they have so infringed, the applicants are not in the circumstances entitled to the injunctive relief claimed, including because of the applicants’ conduct in seeking and obtaining orders in proceeding No WAD 136 of 2009 and further because of the final relief sought in those proceedings.
Witnesses
VIP has filed an initial witness list as required by the fast track practice note. It is unnecessary to consider the detail of that list, let alone the foreshadowed areas of dispute.
While I had initial reservations as to VIP’s contention that expert evidence would be necessary, I can anticipate an argument being mounted specifically going to the question of the exercise of discretion in relation to the granting of injunctive relief. The expert evidence would necessarily require some consideration of the impact upon the parties’ businesses generally, and also on the broader impact generally. That may well be a factor to take into account not only in the exercise of discretion but also in the appropriate construction to be given to s 121 of the TMA. In all those circumstances, to give proper consideration to that expert evidence, it seems to me that a time estimate of only five days, having regard to the entirely novel legal issues, would be extremely optimistic.
RESPONSE BY SCHÜTZ
Schütz argues that the fact of controversy, if any, is confined to very limited aspects of VIP’s cross-bottling conduct. Schütz submits that it is likely that aspects of that conduct will be admitted at trial consistent with the admissions made in the main proceedings. It argues that the action could be heard before the trial of the main proceedings commences in August and may result in a ‘shortcut’ through some of the issues in dispute in that action. Schütz also points to the fact that there is limited need in this action for the parties to give discovery. There is no requirement to consider damages as injunctive relief alone is sought. Schütz would only call Mr Banks whose affidavit has already been filed. It submits that the Court should not be deterred by the novelty of the issues in dispute. Schütz also argues that VIP has been legally represented and should be capable of conducting its defence to the fast track proceeding expediently.
CONSIDERATION
Without dealing with all of those contentions, it is sufficient to say that it is improbable that this matter could be disposed of before the main proceedings. Secondly, I am not persuaded that the duration of the hearing could be disposed of within five days and that alone precludes the matter continuing in the fast track list by reason of para 2.3(a) of Practice Note CM8. Above all, in addition to all those factors, there are very real discretionary considerations going to the question of delay and going to the fact that Schütz expressly seeks as relief in the main proceedings, and has attained by way of interlocutory relief, orders authorising the very conduct that it now complains would be in breach of s 121 of the TMA.
Prejudice
There is a fundamentally significant backdrop to this application and that is the existence of the main proceedings in which the parties have been assiduously engaged for over three and a half years. In those other proceedings I have recently permitted Schütz to file very extensive affidavit evidence said to be in reply to VIP’s evidence. I have done so on the basis that I believe that VIP can cope with that evidence in the remaining time between now and the commencement of the seven week trial in August. It will be extremely difficult to do so if this fast track proceeding were also to be held prior to that time. The question is almost academic because it would mean that the fast track proceeding would need to take place and be resolved before August 2013 when the trial is to commence. Given that I could not hear the fast track proceeding before August and this litigation in the broader sense has been in my docket for a number of years, it is undesirable that another Judge should have to pick up the fast track proceeding at the last minute. The benefits to which Schütz points are elusive. The teams of lawyers for both parties in the main proceedings would have to be expanded considerably to have any prospect of achieving any such benefit, even if another Judge were to hear the fast track proceeding. There is no reason, given the very late application having regard to the history of this litigation, why VIP or the Court should be put under that sort of pressure.
CONCLUSION
For those reasons, the following orders were made:
1.The proceedings no longer be conducted in accordance with the fast track list directions but continue on pleadings.
2.A further directions hearing by telephone be listed on Monday 29 April 2013 at 4:15 pm (EST).
3.The costs of today be reserved.
I certify that the preceding thirty (30) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice McKerracher. Associate:
Dated: 7 May 2013
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