Taylor v Killer Queen LLC

Case [2020] FCA 444

FEDERAL COURT OF AUSTRALIA

Taylor v Killer Queen LLC [2020] FCA 444

File number: NSD 1774 of 2019
Judge: MARKOVIC J
Date of judgment: 7 April 2020
Catchwords: PRACTICE AND PROCEDURE – application for an order pursuant to r 30.01 of the Federal Court Rules 2011 (Cth) that all issues of liability be heard separately from and prior to all other issues in the proceeding – whether just and convenient to make the order – whether the order will contribute to a saving in time and costs – whether there will be any overlap between the evidence adduced in relation to liability and quantum and the effect of such an overlap – whether the order will increase prospects of settlement – application allowed
Legislation:

Federal Court of Australia Act 1976 (Cth) s 37M

Trade Marks Act 1995 (Cth) ss 44, 88, 62A, 120, 122, 124, 126

Federal Court Rules 2011 (Cth) r 30.01

Federal Court Rules 1979 (Cth) O 29 r 2 (repealed) 

Cases cited:

ABB v Freight Rail [1999] NSWSC 1037

Clipsal Australia Pty Ltd v Clipso Electrical Pty Ltd (No 3) [2017] FCA 60

DC Comics v Cheqout Pty Ltd (2013) 212 FCR 194

Fleming’s Nurseries Pty Ltd v Hannaford [2008] FCA 591

Hard Coffee Pty Ltd v Hard Coffee Mainbeach Pty Ltd [2009] ATMO 26; [2009] AIPC 92-343

Reading Australia Pty Ltd v Australian Mutual Provident Society (1999) 240 FCR 276

Date of hearing: 20 March 2020
Registry: New South Wales
Division: General Division
National Practice Area: Intellectual Property
Sub-area: Trade Marks
Category: Catchwords
Number of paragraphs: 54
Counsel for the Applicant: Mr R Cobden SC and Mr R Clark
Solicitor for the Applicant: Silberstein & Associates
Counsel for the Respondent: Ms E Bathurst
Solicitor for the Respondent: Corrs Chambers Westgarth

ORDERS

NSD 1774 of 2019
BETWEEN:

MS KATIE JANE TAYLOR

Applicant
AND:

KILLER QUEEN, LLC

First Respondent

MS KATHERYN ELIZABETH HUDSON

Second Respondent

JUDGE:

MARKOVIC J

DATE OF ORDER:

7 APRIL 2020

THE COURT ORDERS THAT:

1.Pursuant to r 30.01 of the Federal Court Rules 2011 (Cth), all issues of liability, entitlement to additional damages for alleged trade mark infringement and all claims for declaratory and injunctive relief, be heard and determined separately from, and prior to, all other issues and claims in the proceeding.

2.The applicant pay the respondents’ costs of the interlocutory application filed on 3 March 2020.

3.The proceeding be listed for case management hearing on 23 April 2020 at 9.30 am with such case management hearing to take place by telephone or other electronic means, unless the parties provide the Associate to Markovic J with draft consent orders prior to that time.  

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


REASONS FOR JUDGMENT

MARKOVIC J:

  1. This is an application made by the respondents, Killer Queen, LLC (Killer Queen) and Katheryn Elizabeth Hudson, pursuant to r 30.01 of the Federal Court Rules 2011 (Cth) (Rules) for an order that…

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Taylor v Killer Queen LLC [2020] FCA 444
Case
[2020] FCA 444
Decision Date

CaseChat Overview and Summary

In Taylor v Killer Queen LLC, the applicants, Killer Queen LLC, sought an order that all issues of liability be heard separately from and prior to all other issues in the proceeding. The application was heard in the Federal Court of Australia. The central issue before the court was whether it was just and convenient to make the order sought by the respondents. The court considered factors such as the potential for saving in time and costs, the possibility of overlap in evidence, and the effect of the order on the prospects of settlement. The respondents argued that splitting the hearing of issues would be more efficient, contribute to a saving in time and cost, and enhance the prospects of settlement. They submitted that there would be overlap in evidence if the issues were not split, which would necessitate additional disclosure and evidence filing. The court found that it was in the interests of the parties to consider settlement at appropriate stages of the proceeding, and that there was an increased prospect of settlement if liability was established and the cross claim defeated. Consequently, the court allowed the application and ordered that all issues of liability, entitlement to additional damages for alleged trade mark infringement and all claims for declaratory and injunctive relief, be heard and determined separately from, and prior to, all other issues and claims in the proceeding. The court also ordered that the applicant pay the respondents' costs of the interlocutory application and listed the proceeding for a case management hearing to enable orders to be made for the further preparation of the matter for hearing.

Orders

Orders of the court

1. Pursuant to r 30.01 of the Federal Court Rules 2011 (Cth), all issues of liability, entitlement to additional damages for alleged trade mark infringement and all claims for declaratory and injunctive relief, be heard and determined separately from, and prior to, all other issues and claims in the proceeding.

2. The applicant pay the respondents’ costs of the interlocutory application filed on 3 March 2020.

3. The proceeding be listed for case management hearing on 23 April 2020 at 9.30 am with such case management hearing to take place by telephone or other electronic means, unless the parties provide the Associate to Markovic J with draft consent orders prior to that time.

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

At [16] Rolfe J observed that a further difficulty was that if a judge hearing the issue of liability makes any finding about the credit of a witness who will also give evidence in the event of the question of damages being litigated, that judge will, in all probability, be disqualified from hearing the matter. His Honour noted that in those circumstances the “store of knowledge” that the judge had obtained from the initial hearing would be lost as would the impact of evidence upon that judge. THE EVIDENCE Ms Taylor relied on evidence given by her solicitor, Robert Anthony Silberstein, and the respondents relied on evidence given by their solicitor, Odette Margaret Gourley. Both Mr Silberstein and Ms Gourley are experienced solicitors, having each had considerable experience in conducting litigation in intellectual property and related areas. In a number of areas Mr Silberstein and Ms Gourley agreed on approach or issues. To the extent they disagreed, that disagreement was largely a matter of degree or emphasis having regard to the positions of their respective clients. Where necessary I refer to their evidence below. CONSIDERATION The parties made submissions having regard to the factors identified by Branson J in Reading at [8(f)-(g)] focusing on whether splitting the hearing of issues as between liability and quantum will be more efficient and contribute to a saving in time and cost; will contribute to the settlement of the litigation; and whether there will be any overlap between the evidence adduced in relation to the issues of liability and of quantum and, if so, the effect of such an overlap if the hearing of those issues is split. Before turning to consider those submissions, it is timely to recall that, as recognised by Branson J in Reading at [7], as a general rule, all issues of fact and law in a proceeding will usually be determined at one time. However, this general rule has been modified by making orders, previously under O 29 r 2 of the 1979 Rules and, more recently, under r 30.01 of the Rules. The issue for determination before me is whether, in the circumstances of this case, it is just and convenient for the order sought by the respondents to be made. Time and cost of the proceeding Ms Taylor does not intend to make her election for an account of profits or damages and additional damages until at least evidence of quantum has been exchanged. It follows that, as things presently stand, Ms Taylor will seek disclosure of documents and evidence will need to be filed relevant both to an account of profits and to damages. Insofar as disclosure of documents is concerned, Ms Taylor has provided the categories of documents in which she seeks discovery to the respondents. They include:8.Documents which record any one or more of the following pieces of information:a. the stock-keeping unit (SKU);b. item description;c. cost price;d. wholesale price;e. retail price;f. stock quantity at any given time,of all clothes or Related Goods marketed or sold bearing the Infringing Marks, or in association with the Infringing Marks, in Australia or to people in Australia, after 24 October 2013 (the Relevant Goods). If documents exist accurately recording that or any of that information in summary form for particular periods, for example in quarterly or monthly reports, that will be sufficient in the first instance.9. Summary documents which record the:a.number of Relevant Goods sold (by reference to each SKU);b.revenue derived by the Respondents, or any related party of the Respondents, from the sale of the Relevant Goods; andc.net profit derived by the Respondents, or any related party of the Respondents, from the sale of the Relevant Goods.(Original emphasis.)

Decision

Reasons for decision

It is in the interests of the parties to consider settlement at appropriate stages of a proceeding. To do so is in conformity with the overarching purpose set out in s 37M of the Federal Court Act. It may well be that Ms Taylor cannot sensibly engage in any mediation or settlement discussions without an understanding of issues relating to quantum. There are, no doubt, ways in which that requirement could be managed within the context of any mediation or settlement discussions that might take place, having regard to the overall nature of the proceeding. Further, if Ms Taylor is successful in establishing liability and defeating the cross claim, it seems to me, as the respondents submit, that there is an increased prospect that the parties may engage in more fruitful settlement discussions. If that occurs there would be no need for a further hearing on quantum. CONCLUSION Weighing all of the factors considered above, in my opinion this is a case in which it is just and convenient to make an order pursuant to r 30.01 of the Rules in the terms sought by the respondents such that all issues of liability, entitlement to additional damages for alleged trade mark infringement and all claims for declaratory and injunctive relief sought in this proceeding will be heard and determined separately from, and prior to, all other issues and claims in the proceeding. As Ms Taylor has been unsuccessful in her opposition to the application she should pay the respondents’ costs. As requested by the parties the proceeding will be listed for case management hearing before me on 23 April 2020 at 9.30 am to enable orders to be made for the further preparation of the matter for hearing.

Ratio Decidendi

Legal Principle Established

Ms Taylor relied on evidence given by her solicitor, Robert Anthony Silberstein, and the respondents relied on evidence given by their solicitor, Odette Margaret Gourley. Both Mr Silberstein and Ms Gourley are experienced solicitors, having each had considerable experience in conducting litigation in intellectual property and related areas. In a number of areas Mr Silberstein and Ms Gourley agreed on approach or issues. To the extent they disagreed, that disagreement was largely a matter of degree or emphasis having regard to the positions of their respective clients. Where necessary I refer to their evidence below. CONSIDERATION The parties made submissions having regard to the factors identified by Branson J in Reading at [8(f)-(g)] focusing on whether splitting the hearing of issues as between liability and quantum will be more efficient and contribute to a saving in time and cost; will contribute to the settlement of the litigation; and whether there will be any overlap between the evidence adduced in relation to the issues of liability and of quantum and, if so, the effect of such an overlap if the hearing of those issues is split. Before turning to consider those submissions, it is timely to recall that, as recognised by Branson J in Reading at [7], as a general rule, all issues of fact and law in a proceeding will usually be determined at one time. However, this general rule has been modified by making orders, previously under O 29 r 2 of the 1979 Rules and, more recently, under r 30.01 of the Rules. The issue for determination before me is whether, in the circumstances of this case, it is just and convenient for the order sought by the respondents to be made. Time and cost of the proceeding Ms Taylor does not intend to make her election for an account of profits or damages and additional damages until at least evidence of quantum has been exchanged. It follows that, as things presently stand, Ms Taylor will seek disclosure of documents and evidence will need to be filed relevant both to an account of profits and to damages. Insofar as disclosure of documents is concerned, Ms Taylor has provided the categories of documents in which she seeks discovery to the respondents. They include:8.Documents which record any one or more of the following pieces of information:a. the stock-keeping unit (SKU);b. item description;c. cost price;d. wholesale price;e. retail price;f. stock quantity at any given time,of all clothes or Related Goods marketed or sold bearing the Infringing Marks, or in association with the Infringing Marks, in Australia or to people in Australia, after 24 October 2013 (the Relevant Goods). If documents exist accurately recording that or any of that information in summary form for particular periods, for example in quarterly or monthly reports, that will be sufficient in the first instance.9. Summary documents which record the:a.number of Relevant Goods sold (by reference to each SKU);b.revenue derived by the Respondents, or any related party of the Respondents, from the sale of the Relevant Goods; andc.net profit derived by the Respondents, or any related party of the Respondents, from the sale of the Relevant Goods.(Original emphasis.)