Seafolly Pty Ltd v Fewstone Pty Ltd

Link copied
Case Copied 72 min read

FEDERAL COURT OF AUSTRALIA

Seafolly Pty Limited v Fewstone Pty Ltd [2014] FCA 321

Citation: Seafolly Pty Limited v Fewstone Pty Ltd [2014] FCA 321
Parties: SEAFOLLY PTY LIMITED (ACN 001 537 748) v FEWSTONE PTY LTD (ACN 010 496 465)
File number: VID 488 of 2012
Judge: DODDS-STREETON J
Date of judgment: 1 April 2014
Catchwords:

COPYRIGHT – the applicant owned copyright in the English Rose and Covent Garden artworks used on fabric to produce swimwear – whether the respondent’s Rosette print infringed the applicant’s copyright in the English Rose artwork – whether the respondent’s Sienna print infringed the applicant’s copyright in the Covent Garden artwork

COPYRIGHT – whether copyright subsisted in the applicant’s Senorita artwork – whether the respondent’s Richelle embroidery infringed the applicant’s copyright in the Senorita artwork – whether the shirring/smocking used in the Senorita garments was a corresponding design of the Senorita artwork for the purposes of s 74(1) of the Copyright Act 1968 (Cth) – whether the respondent had a defence under the copyright designs overlap provisions of div 8 pt III of the Copyright Act 1968 (Cth) and s 18 of the Designs Act 2003 (Cth)

DAMAGES – infringement of copyright – applicant sought compensatory damages for lost profit and damage to reputation, additional damages and conversation damages – availability and measure of damages sought
Legislation: Copyright Act 1968 (Cth) ss 14, 31, 36, 37, 38, 74, 77, 115 and 116
Copyright Regulations 1969 (Cth) reg 17
Designs Act 2003 (Cth) s 18
Cases cited:

Accounting Systems 2000(Developments) Pty Ltd v CCH Australia Ltd (1993) 42 FCR 470
Ancher, Mortlock, Murray & Woolley Pty Ltd v Hooker Homes Pty Ltd [1971] 2 NSWLR 278
Aristocrat Technologies Australia Pty Ltd v DAP Services (Kempsey) Pty Ltd (in liq) (2007) 157 FCR 564; [2007] FCAFC 40
Axe Australasia Pty Ltd v Australume Pty Ltd (2006) 69 IPR 45; [2006] FCA 668
Baigent v Random House Group Ltd (2007) 72 IPR 195
Bailey v Namol Pty Limited (1994) 53 FCR 102
Barrett Property Group Pty Ltd v Metricon Homes Pty Ltd (2007) 74 IPR 52; [2007] FCA 1509
Cummins v Vella [2002] FCAFC 218
Designers Guild Ltd v Russell Williams (Textiles) Ltd [2000] 1 WLR 2416
Eagle Homes Pty Ltd v Austec Homes Pty Ltd (1999) 87 FCR 415; [1999] FCA 138
Elwood Clothing Pty Ltd v Cotton On Clothing Pty Ltd (2008) 172 FCR 580; [2008] FCAFC 197
Elwood Clothing Pty Ltd v Cotton On Clothing Pty Ltd [2009] FCA 633
EMI Songs Australia Pty Ltd v Larrikin Music Publishing Pty Ltd (2011) 191 FCR 444
Facton Ltd v Rifai Fashions Pty Ltd (2012) 95 IPR 95; [2012] FCAFC 9
Futuretronics.com.au Pty Ltd v Graphix Labels Pty Ltd (No 2) (2008) 76 IPR 763; [2008] FCA 746
GM Holden v Paine (2011) 281 ALR 406; [2011] FCA 569
Hanfstaengl v HR Baines & Co Ltd (Hanfstaengl v Empire Palace) [1985] AC 20
IceTV Pty Ltd v…

CaseChat AU logo

Keep reading for free

Create a free CaseChat account to read Seafolly Pty Ltd v Fewstone Pty Ltd and more:

  • Read every judgment in full
  • Ask AI and get answers linked to paragraphs
  • See how each paragraph was cited in later cases
  • Download judgments as PDF or Word
Continue with Google

One click creates your free account or signs you in.

By continuing you agree to the Terms and Privacy Policy.

Details
Case
[2014] FCA 321
Decision Date

CaseChat Overview and Summary

Seafolly Pty Ltd, an Australian company that designs, manufactures, and sells swimwear, filed a lawsuit against Fewstone Pty Ltd (City Beach), alleging copyright infringement. Seafolly claimed that City Beach had copied their copyrighted designs used on fabric for their swimwear and had sold garments featuring these designs. The legal issues included whether City Beach's Rosette print infringed on Seafolly's English Rose artwork, whether City Beach's Sienna print infringed on Seafolly's Covent Garden artwork, and whether City Beach's Richelle embroidery infringed on Seafolly's Senorita artwork. Additionally, the court considered whether Seafolly's shirring/smocking used in the Senorita garments was a corresponding design for the purposes of section 74(1) of the Copyright Act 1968, and whether City Beach had a defence under the copyright designs overlap provisions.

The court found that Seafolly had established its claim for copyright infringement and granted relief as sought in its further amended originating application. The court declared that City Beach had infringed Seafolly's copyright, ordered City Beach to pay Seafolly damages of $250,333.06, and restrained City Beach from reproducing or substantially reproducing the copyrighted works, manufacturing, selling, or exhibiting items made from the fabric used to manufacture City Beach's garments, advertising, marketing, and promoting such items, and disposing of the garments or materials used to create them. The court also ordered City Beach to deliver up any materials bearing reproductions of the design on the fabric used to manufacture City Beach's garments and any remaining stock of such garments to Seafolly by a specified date. The court stayed the restraint order until a later date to allow City Beach time to comply with the delivery-up order.

The court further found that copyright subsisted in Seafolly's Senorita artwork and that City Beach's Richelle embroidery infringed on this copyright. The court also found that Seafolly's shirring/smocking used in the Senorita garments was a corresponding design for the purposes of section 74(1) of the Copyright Act 1968, and that City Beach did not have a defence under the copyright designs overlap provisions. The court reserved costs and listed the matter for directions after a specified date.

Orders

Orders of the court

2. The respondent pay the applicant damages in the sum of $250,333.06.

3. The respondent whether by itself, its directors, employees, servants, agents or any of them be restrained from:

(a) reproducing or substantially reproducing the Copyright Works or authorising such conduct;

(b) manufacturing, importing for sale, selling, or by way of trade, offering and exposing for sale, or exhibiting in public:

(i) items manufactured from the fabric used to manufacture the Respondent’s Garments (as defined in paragraph 15 of the third further amended fast track statement); and

(ii) the Respondent’s Garments;

(c) advertising, marketing and promoting:

(i) items manufactured from the fabric used to manufacture the Respondent’s Garments; and

(ii) the Respondent’s Garments; and

(d) disposing of possession of:

(i) the Respondent’s Garments; and

(ii) the materials used to create the Respondent’s Garments

other than in accordance with order 5 below;

4. Order 3 be stayed until 4 pm on 8 April 2014.

5. The respondent whether by itself, its directors, employees, servants, agents or howsoever deliver up to the applicant:

(a) any materials bearing reproductions of the design on the fabric used to manufacture the Respondent's Garments or any remaining stock of such fabric; and

(b) any remaining stock of the Respondent's Garments

in its possession, custody or control and by 4pm on 15 April 2014 verify on affidavit its compliance with this order.

6. Costs of the proceeding be reserved.

7. The matter be listed for directions at a time convenient to the Court and the parties after 18 April 2014.

Note: Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules 2011.

Background

Background to the litigation

The respondent relied on the following affidavits from expert witnesses, who were cross-examined by the applicant:(a)The affidavit of Dean McGregor Brough, the Bachelor of Creative Industries course coordinator and lecturer (fashion) at Queensland University of Technology, sworn 23 April 2013. Mr Brough was, although unable to respond directly to some questions, a credible and knowledgeable expert witness.(b)The affidavit of Robert Lewis McLaurin, the NSW sales manager for Capron Carter Australia Pty Ltd, sworn 16 April 2013. Mr McLaurin was a credible and knowledgeable expert witness.(c)The affidavit of Jessica Thurecht, a swimwear and textiles designer, affirmed on 24 April 2013. Ms Thurecht was called by the respondent as an expert witness. She acknowledged that she had previously worked for 2Chillies as an employee and, after her employment ceased, as a contractor, who had peripheral involvement in the development of the Rosette print. She was a credible witness who appeared disinterested despite her prior connection with 2Chillies.BACKGROUND FACTS AND EVIDENCESeafolly Seafolly is an Australian company which, since 1975, has conducted business as a designer, manufacturer, wholesaler and retailer of fashion swimwear and swimwear accessories for women, girls and boys. Seafolly sells its garments through various retailers in Australia in over 500 multi‑brand stores (including major department stores), in Seafolly concept boutiques, factory outlets and through a website located at >Seafolly also sells products in 1755 retail outlets overseas, where it also maintains offices. Seafolly’s chief executive officer is Anthony Halas, who has held that position since 1998. Seafolly employs over 350 people and maintains a design team of 33 people, including both graphic and garment designers, at its Sydney head office. The following members of the Seafolly design team were involved in work and exchanges relevant to this case: (a)Ms Walkom; (b)Ms Antao; (c)Ms Coundouris; and(d)Ms So. Although it has an “in house” design team, Seafolly also engages an external design company, Longina, to design fabrics for Seafolly according to its instructions. The following designers employed by Longina were involved in work and exchanges relevant to this case:(a)Ms Kerr;(b)Ms Cheung; (c)Ms Dean; and(d)Mr Zhang.City Beach The respondent, City Beach, was established in 1985 and maintains its head office in Brisbane. It conducts business as a designer, manufacturer and retailer of clothing including beachwear, surfwear, shoes, sports equipment and accessories for men, women and children. City Beach sells its goods, including clothing, through a chain of City Beach retail stores in Australia. It has 60 City Beach stores spread throughout Queensland, New South Wales, Victoria, Western Australia and the Northern Territory. It also sells its goods, including clothing, through its website >City Beach retains a number of personnel as buyers. The City Beach buyers and production personnel involved in work and exchange relevant to this case were: (a)Ms Knobel;(b)Ms Hanger;(c)Ms Dunlop; and(d)Ms Bon.

Evidence

Evidence Before The Court

Full text does not contain this section.

Decision

Reasons for decision

In his affidavit, Mr Wilson did not undertake that City Beach would not sell such garments in future or, in terms, depose that City Beach no longer possessed any such garments.CONCLUSION In my opinion, the applicant has established its claim to relief broadly in terms of that sought in its further amended originating application dated 5 April 2013. There should be a declaration that the respondent has infringed the applicant’s copyright to an order for damages in the sum of $250,333.06, and, in the absence of an undertaking, at least, an injunction and orders for delivery up.

Ratio Decidendi

Legal Principle Established

Full text does not contain this section.