Secretary, Department of Social Security v Willee

[1990] FCA 221

22   I ./ 90

JUDGMENT No. ........ .... ....,.-,

NOT FOR DISTRIBUTION

IN THE FEDERAL COURT OF AUSTRALIA	1
)
NEW SOUTH WALES DISTRICT REGISTRY	) No NG 259 of 1990
)
GENERAL DIVISION	)

BETWEEN:	COWING	INCORPORATED &
ANOR.

Applicants

m CAMPBELLS CASH & CARRY
PTY. LIMITED

Respondent

21 May 1990

REASONS FOR JUDGMENT

LOCKHART J:

This is a motlon by the two applicants, Corning Incorporated ("Corning") and Corning Australia Pty Limited

("Corning Australia") for interlocutory injunctive relief

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against the respondent, Campbells Cash and Carxy Pty Limited. ,

The claim asserted by the two applicants is based upon alleged breach of copyright and of section 53(g) of the Trade Practices Act 1974.

The case was instituted only very recently, namely by
the filing of an application last Friday, 18 May, though RECEIVED 2

preceded by certain directions given by another Judge of this Court the day before. The respondent has therefore had little time to prepare its case to resist the grant of interlocutory relief and I take that into account.

What the applicants seek today is interlocutory injunctive relief pending the final hearing of the matter or further order. I should say at once that I will not at this stage grant an injunction to subsist until the final hearing of the matter or further order. The most I would be prepared to consider is granting an injunction until the matter can be more thoroughly looked at by the Court either on an interlocutory or final basis and I have indicated to the parties that the matter can be taken next week. Whether it then proceeds as an interlocutory hearing or final hearing is a matter for the Court and the parties to determine in the

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meantime. i t I

I shall say something about the facts, but in view of the fact that there is no evidence from the respondent at this stage I shall confine myself to what appear to be the basic facts for presently relevant purposes. Anything I say about the facts must be treated, of course, as tentative or prima

facie as the facts have not yet been thoroughly explored. Whether the facts remain in that state later in the case remains to be determined.

A brief picture of the parties and the present issue is, however, called for. Corning manufactures a wide variety and range of cook ware products, including a range known as Corning Ware. The cook ware is manufactured and packaged in the United States. Corning Australia is a wholly owned subsidiary of a company which is in turn wholly owned by Corning. Corning Australia is the exclusive distributor in Australia of Corning's Corning Ware products.

The respondent is a company with a fairly large number of outlets for sale. Corning Australia has supplied the

respondent with various items in the Corning Ware range but

has not supplied it with what is called the Corning Ware A-300

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which is a six piyce set of casserole dishes having three

bases and three lids available in various decorations.

Corning Australia sells the A-300 but it does so by importing it from the United States of America to meet the special orders of specific customers. It is not an item that is generally held in stock by Corning Australia.

The respondent is selling the A-300 through a number of its outlets in this State and other States of Australia. It sells it at a substantially cheaper price than the price at which Corning Australia sells it in Australia, namely, $59 as against Corning Australia's minimum price of $67.95. The respondent has large stocks of the A-300, some of which have already been sold. It seems plain from the evidence that the respondent is continuing to sell and intends to sell the A-300 and will use its best endeavours to do so over the next ten days or so.

There is some suggestion in the evidence adduced by the applicants that the respondent is engaged in television promotion of that product, the details of which are, however, imprecise and unclear.

t There is evidenye which satisfies me for present

purposes that there is a serious question to be,tried pursuant to the issues raised on the facts under sections 37 and 38 of

the Co~vriaht Act 1968. There is certainly evidence which

supports an arguable case that the respondent is itself importing into Australia the A-300 from sources that are not authorised by Corning or Corning Australia; and, as I have said, there is also evidence which suggests that the respondent is selling the A-300 in this country without the licence of the owner of the copyright. I shall now address some remarks to this issue.

I do not go into the evidence presently before the Court as to proof by Corning of its ownership of relevant copyright except to say I am satisfied that there is a reasonably arguable case that Corning does own the copyright in the text and illustrations which appear on the packaging in which the A-300 is marketed.

I am satisfied that there is a serious question to be tried on the copyright issues that are presently before the Court and that if the balance of convenience favours the grant of an injunction, albeit for a short period, then it should be granted.

I do not find it necessary to examine the alternative basis upon which the applicants put their claim, namely, the breach of S. 53(g) of the Trade Practices Act; that will be something to be determined in due course as it is a case that

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rests .on a certain degreer of refinement whicQ it is

inappropriate to consider at this stage.

On the balance of convenience, it seems to me that on the evidence before the Court at the moment it is likely that the respondent will continue its sales of the A-300 in the next few weeks unless restrained by the Court. I am not satisfied on the material presently before the Court that there would be any damage suffered by the respondent that could not be cured by an undertaking as to damages which would of course be given by the applicants if injunctive relief is granted.

Corning Australia has spent substantial sums of money on advertising Corningware products generally including the A-300.

There is some evidence of complaints being received by Corning Australia from customers about the fact that the respondent is selling the A-300 at a lower price than the price at which those customers are supplied by Corning Australia. In addition to any loss that may be occasioned to Corning Australia by lost sales, I am satisfied that there is an arguable case that there could be further damage to Corning Australia through its customers being of the view that they are receiving differential and, indeed, adversely differential

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treatment in, the market place on the perceived assumption that

Corning Australia is selling the A-300 at a lower price.

Whether this ultimately results in firm evidence to

establish these matters or not I cannot say. I am only
dealing with the matter very much on an interlocutory footing.

I am, however, satisfied that there could be a definite prejud~ce to the business of Corning Australia and perhaps Corning itself if the sales are allowed to continue at the present time, as well trading losses which it may sustain by reason of those sales.

On the whole of the evidence I am satisfied that the balance of convenience favours the grant of an injunction rather than its refusal though, as I say, I take into account the very short notice of the matter that has been received by the respondent.

Accordingly the first order which I propose to make is

as follows.

Upon the applicants through their counsel giving the usual undertaking as to damages the court orders that up to and including Wednesday, 30 May 1990 or further order that the respondent by itself, its servants or agents be restrained from, without the licence of the first applicant, importing,

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distributing, selling or otherwise dealing with cookware known ,

as the Corningware six-piece casserole set packaged and

distributed as the A-300, not being cookware acquired from	the second applicant.
The Court has been asked to make a further order by the applicants, namely, that the respondent should file and serve an affidavit within seven days of today in essence setting out the names and addresses and other particulars of persons who may be the source of supply of the A-300 to the respondent and certain consequential information.
Much of the information which the applicants seek in this regard could be obtained by the process of subpoena but I have no doubt, whatever be the ultimate result of this case, that information of this kind which the applicants seek to have furnished by affidavit from the respondent will be before the Court in any event, whether produced by the applicants or the respondent, and I think the interests of justice are served without detriment, so far as I can see, to the respondent if an affidavit of the kind sought is in fact filed and served. It has the advantage that it can be filed and served before the matter is heard by the Court next week; and if it reveals facts which would lead the applicants to consider either separate proceedings against other persons or an amendment to these proceedings by the addition of other respondents, that can be put in train before the matter comes for hearing. The respondent will also know of that and cause
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it, I think, ultimately less inconvenience.
If the compliance with an order of this kind would require the respondent to distinguish between what it would assert to be confidential information and information in the public domain, that can always be protected in the affidavit itself by the inclusion of any alleged confidential material in a sealed envelope to accompany the affidavit. However, if that course should be taken then I will give liberty to the parties to put the matter back in the list so that appropriate directions can be given as to whether the contents of any such document can be inspected by the applicants or their counsel and solicitors before the hearing commences so as to avoid time being wasted or thrown away on that occasion. Accordingly, the Court also orders, in addition to the injunction which I have already granted, that on or before Monday 28 May 1990, the respondent file and serve upon the solicitors for the applicants an affidavit setting forth,
(A) the names and addresses of all persons and companies known to the respondent to be responsible for supplying the A300 to the respondent together with the dates and quantities of each supply and exhibiting copies of all documents in the possession power, custody or control of the respondent relating to such supply to the respondent and
(B) the whereabouts of any of the A300 products which are in
the power, possession, custody or control of the respondent or are being held on behalf of the respondent by another person
firm, or company.
The applicants also requested that the affidavit include the names and addresses of all persons and companies to whom the respondent has supplied or sold the A300 together with the dates and quantities of each supply and sale and exhibiting copies of all documents in the possession, power, custody or control of the respondent relating to such sale or supply by the respondent.
Counsel for the respondent submitted that she was instructed that preparation of the necessary material to comply with such an order would be attended by many problems. I have come to the view that there is substance in that contention and therefore I decline to make this further order.
Upon the applicants through their counsel giving the usual undertakings as to damages, the Court orders that:
1. Up to and including Wednesday 30 May 1990 or further order, the respondent by itself its servants and agents be
estrained from without the licence of the first applicant
importing, distributing, selling or otherwise dealing with
cookware known as the Corning Ware 6 piece casserole set
packaged and distributed as the A300 not being cookware
acquired from the second applicant; the operation of that

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order will ,not commence until 8 am eastern standard time

tomorrow, 22 May 1990.

2 . On or before Monday 28 May 1990, the respondent file and

serve upon the solicitors for the applicants an affidavit or
affidavits setting forth

(a)	the names and addresses of all persons and companies known to the respondent to be responsible for supplying the A300 to the respondent together with the dates and quantities of each supply, and exhibiting copies of all documents in the possession, power, custody or control of the respondent relating to such supply to the respondent and
(b)	the whereabouts of any of the A300 which are in the power, possession, custody or control or the respondent or are being held on behalf of the respondent by another person, firm or company.

3.     Costs of the motion to be costs in the proceeding.

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4 . Any party is at liberty to apply upon 2 4 hours notice in relation to any problems that may arise with respect to the

working out of order 2 .

I certlfy that thls and the preceding ten ( 1 0 ) pages are a true copy of the reasons for ludgment hereln of the Honourable Mr Justlce Lockhart

Assoclate

Dated:  21 May 1990

Counse l f o r A p p l l c a n t : MS. A . H . Bowne

S o l l c l t o r f o r A p p l l c a n t : A l l e n A l l e n & Hemsley

Counse l f o r Respondent: MISS C.A. Needham

S o l l c l t o r f o r Respondent: P.A. Somerse t & Co.

Date o f Hea r lng : 21 May 1990

Date of Judgment:  21 May 1990

Counsel f o r A p p l l c a n t : M s . A .H . Bowne

S o l l c l t o r f o r A p p l l c a n t : A l l e n A l l e n & Hemsley

Counsel f o r Respondent: M l s s C.A. Needham

S o l l c l t o r f o r	Respondent:	P.A. Somerset & Co.
D a t e o f	H e a r ~ n g :	2 1 May 1990
D a t e o f	Judgment:	2 1 May 1990