Taylor v Killer Queen, LLC (No 4)

Case [2021] FCA 1144

FEDERAL COURT OF AUSTRALIA

Taylor v Killer Queen, LLC (No 4) [2021] FCA 1144

File number: NSD 1774 of 2019
Judgment of: MARKOVIC J
Date of judgment: 22 September 2021
Catchwords:

PRACTICE AND PROCDURE – application to file further amended defence and further amended statement of cross-claim – where respondents seek to withdraw admission as to use of trade mark in amended defence – where admission was based on an incorrect understanding of the law – where enabling case to proceed on a basis consistent with the current law outweighs any prejudice to applicant – where amendments in proposed further amended statement of cross-claim arise from correspondence concerning further category of discovery sought by respondents – where proposed amendments are reasonably arguably relevant to cross-claimants’ claims and applicant’s evidence – proposed amendments would not be liable to be struck out if they appeared in the original pleading – application granted

PRACTICE AND PROCEDURE – application for discovery of categories of documents – whether categories sought relevant to issues in the proceeding or oppressive – application granted in part

Legislation:

Trade Marks Act 1995 (Cth) ss 60, 88, 120

Federal Court Rules 2011 (Cth) rr 16.53, 20.11, 20.16, 20.17

Cases cited:

Ansell Healthcare Product LLC v Reckitt Benckiser(Australia) Pty Ltd (No 2) [2016] FCA 765

Aristocrat Technologies Australia Pty Ltd v Vidtech Gaming Services Pty Ltd [2006] FCA 275 (2006) 68 IPR 229

Babscay Pty Ltd v Pitcher Partners (A Firm) [2019] FCA 480

Deep Investments Pty Ltd v Casey (No 1) [2017] FCA 1643

Dollinger Filtration Ltd v Laminar Airflow Pty Ltd [2021] FCA 817

PDP Capital Pty Limited v Grasshopper Venture Pty Limited [2020] FCA 1078; (2020) 154 IPR 68

PDP Capital Pty Ltd v Grasshopper Ventures Pty Limited [2021] FCAFC 128; (2021) 391 ALR 608

Rodney Jane Racing Pty Ltd v Monster Energy Company [2019] FCA 923; (2019) 370 ALR 140

Tamaya Resources Limited (in liq) v Deloitte Touche Tohmatsu (A Firm), in the matter of Tamaya Resources Limited (in liq) [2015] FCA 1098

Tamaya Resources Limited (in liq) v Deloitte Touche Tohmatsu (A Firm) [2016] FCAFC 2; (2016) 332 ALR 199
Division: General Division
Registry: New South Wales
National Practice Area: Intellectual Property
Sub-area: Trade Marks
Number of paragraphs: 150
Date of hearing: 14 September 2021
Counsel for the Applicant: Mr R Cobden SC and Mr R Clark
Solicitor for the Applicant: Silberstein & Associates
Counsel for the Respondents: Mr MJ Darke SC and Ms E Bathurst
Solicitor for the Respondents: Corrs Chambers Westgarth

ORDERS

NSD 1774 of 2019
BETWEEN:

KATIE JANE TAYLOR

Applicant  
AND:

KILLER QUEEN, LLC

First Respondent

KATHERYN ELIZABETH HUDSON

Second Respondent

KITTY PURRY, INC. (and another named in the Schedule)

Third Respondent

AND BETWEEN:

KILLER QUEEN, LLC (and another named in the Schedule)

First Cross-Claimant

AND:

KATIE JANE TAYLOR

Cross-Respondent

ORDER MADE BY:

MARKOVIC J

DATE OF ORDER:

22 SEPTEMBER 2021

THE COURT ORDERS THAT:

1.The applicant/cross-respondent is to give discovery in accordance with r 20.16 and r…

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AGLC
Taylor v Killer Queen, LLC (No 4) [2021] FCA 1144
Case
[2021] FCA 1144
Decision Date

CaseChat Overview and Summary

The case of Taylor v Killer Queen, LLC (No 4) involved an application by the respondents to file a further amended defence and a further amended statement of cross-claim. The respondents sought to withdraw an admission in their amended defence that the name "Katy Perry" was used as a trade mark in relation to certain merchandise. They argued that the admission was based on an incorrect understanding of the law, and that the enabling of the case to proceed on a basis consistent with the current law outweighed any prejudice to the applicant. The respondents also sought to amend their cross-claim to include new paragraphs relating to the claim for cancellation of the applicant's trade mark.

The legal issues before the court were whether leave should be granted to the respondents to file their further amended defence and further amended statement of cross-claim, and whether the categories of documents sought by the respondents in their discovery application were relevant to the issues in the proceeding or oppressive.

The court held that the enabling of the case to proceed on a basis consistent with the current law outweighed any prejudice to the applicant, and that the proposed amendments to the respondents' defence and cross-claim were reasonably arguably relevant to the cross-claimants' claims and the applicant's evidence. The court also found that the categories of documents sought by the respondents were relevant to the issues in the proceeding and not oppressive.

In conclusion, the court granted the respondents' application to file their further amended defence and further amended statement of cross-claim, and granted the respondents' application for discovery of categories of documents in part. The applicant was ordered to give discovery in accordance with the Federal Court Rules 2011 (Cth) and produce for inspection by electronic means all documents falling within certain categories specified in the interlocutory application filed by the respondents. The respondents were also ordered to pay the applicant's costs thrown away by reason of the filing of their further amended defence and further amended statement of cross-claim. The court further ordered that if the applicant wished to seek an order as to costs of the interlocutory application different to that set out in the reasons for decision, she should file her submissions in support of that alternate order, and if the respondents did not agree to the alternate order proposed by the applicant, they should file their submissions in reply. A determination as to the costs of the interlocutory application would be made on the next occasion that the proceeding was listed before the court.

Orders

Orders of the court

1. The applicant/cross-respondent is to give discovery in accordance with r 20.16 and r 20.17 of the Federal Court Rules 2011 (Cth) and produce for inspection by electronic means all documents falling within categories 1, 2, 3, 3A(a), 3B and 5(b) and (c) in the Schedule to the interlocutory application filed by the respondents/cross-claimants on 16 August 2021 (Interlocutory Application).

2. Leave be granted to the respondents/cross-claimants to file and serve:

(a) the further amended defence to further amended statement of claim in the form provided to the applicant’s solicitor on 15 July 2021 and annexed to the affidavit of Odette Margaret Gourley sworn 9 August 2021 at annexure OMG-5; and

(b) the further amended statement of cross-claim in the form provided to the applicant’s solicitor on 23 July 2021 and annexed to the affidavit of Odette Margaret Gourley sworn 9 August 2021 at annexure OMG-4.

3. The respondents are to pay the applicant’s costs thrown away by reason of the filing of the further amended defence to further amended statement of claim pursuant to Order ‍2 above.

4. The cross-claimants are to pay the applicant’s costs thrown away by reason of the filing of the further amended statement of cross-claim pursuant to Order 2 above.

5. If the applicant wishes to seek an order as to costs of the Interlocutory Application different to that set out at [149] of the reasons for decision published today then:

(a) she should file her submissions in support of that alternate order, not exceeding two pages in length, by 29 September 2021;

(b) if the respondents/cross-claimants do not agree to the alternate order proposed by the applicant, they should file their submissions in reply, not exceeding two pages in length, by 6 October 2021; and

(c) a determination as to the costs of the Interlocutory Application will be made on the next occasion that the proceeding is listed before the Court.

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

Background

Background to the litigation

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Evidence

Evidence Before The Court

In the Proposed Further Amended Defence:(1)para 10 has been amended as follows:In answer to paragraph 10 of the Statement of Claim, the Respondents:(a)repeat paragraphs 7(a), (a1) and (b) herein;(b)admit say, in relation to the merchandise referred to in paragraph 7(b) herein, that the name “Katy Perry” is used as a trade mark in relation to such merchandise by certain of the licensees referred to in paras 7(a) and 7(a1) or under the control of one or more of the Respondents (or one of them); and(c)otherwise deny the allegations in the paragraph. (2)para 11 has been amended to include a new sub para (d1) as follows:The Respondents deny the allegations in paragraph 11 of the Statement of Claim and:…(d1)say further that, insofar as the Respondents are alleged to be joint tortfeasors with the operators referred to in paragraph 8 of the Statement of Claim, the said operators are entitled to the benefit of the defences afforded by sections 122(1) and 124 of the TM Act and thus have not infringed the Applicant’s Mark; (Underlining and strike out in original.)Evidence The respondents rely on the evidence of Odette Margaret Gourley, a partner of Corrs Chambers Westgarth and the solicitor on the record for them. Ms Gourley gave evidence as to why the respondents seek to amend their defence, with particular focus on the amendment to para 10. Ms Taylor relies on the evidence of Robert Anthony Silberstein, the principal of Silberstein & Associates Pty Ltd and her solicitor. Dr Silberstein gave evidence about the steps taken in preparation of the matter in reliance on his understanding of the Amended Defence and the prejudice to Ms Taylor should leave be granted to file the Proposed Further Amended Defence. In order to understand the position taken by the parties it is necessary first to refer to the relevant correspondence that passed between them. Commencing in January 2020 Ms Taylor sought clarification of the defence filed by Killer Queen and Ms Hudson. By letter dated 9 January 2020 Silberstein & Associates inquired about the effect of paras 7(a)(i) and (ii) and para 11 of the defence. In relation to para 11 an inquiry was made in the following terms:Is the denial in paragraph 11predicated upon the matters in sub paragraphs (a)-(e) only? Or is there some other basis for the denial? That is, do your clients accept that if they do not make out their defences, and our client’s mark is not cancelled, they would infringe our client’s mark? If there is some other basis for the denial, what is it?Silberstein & Associates then raised some further specific queries in relation to the defence based on s 122 of the TM Act pleaded in para 11. On 11 February 2020 Corrs provided a response to the letter referred to in the preceding paragraph. In answer to the specific query concerning para 11 of the defence they wrote:This is not a proper request for particulars and the pleading in paragraph 11 of the Defence should be taken as it stands. It is for your client to plead and prove the cause of action on which it relies. For the avoidance of doubt, our clients’ denial of paragraph 11 does not operate in the limited fashion described in your letter. That is, our clients do not accept that the allegations in paragraph 11 of the Statement of Claim are made out, subject only to any of the defences referred to in subparagraphs (a) to (e) of the Defence being proven.

Decision

Reasons for decision

The respondents also seek leave to amend para 11 of the Amended Defence in the manner identified at [13] above. Ms Taylor conceded that if the amendment to para 10 is allowed then it would follow that the amendment to para 11 would also be allowed. Conclusion on leave to file the Proposed Further Amended Defence It follows from the above that the respondents should be granted leave to file their defence in the form of the Proposed Further Amended Defence.SHOULD LEAVE BE GRANTED TO FILE THE PROPOSED FURTHER AMENDED CC? The cross-claimants seek leave to file the Proposed Further Amended CC which seeks to make two amendments: the first is the inclusion of a new para 8A and a consequential amendment to para 9; and the second is to para 20. Ms Taylor opposes the first proposed amendment and opposes the inclusion of subpara (c) in the second amendment. The first proposed amendment concerns the claim for cancellation of the Applicant’s Mark made by the cross-claimants pursuant to s 60 and s 88(2)(a) of the TM Act. Section 60 provides:The registration of a trade mark in respect of particular goods or services may be opposed on the ground that:(a)another trade mark had, before the priority date for the registration of the first-mentioned trade mark in respect of those goods or services, acquired a reputation in Australia; and(b)because of the reputation of that other trade mark, the use of the first-mentioned trade mark would be likely to deceive or cause confusion.(Note omitted.) The claim, incorporating the proposed amendment, would be as follows:8.Before the Priority Date for the Katie Perry Mark in respect of clothes, the trade mark KATY PERRY had acquired a reputation in Australia.ParticularsThe Cross-claimants refer to and repeat the Particulars to paragraph 11(c) of their Defence in these proceedings.8A.Before the Priority Date for the Katie Perry Mark, the Katie Perry Mark had not acquired a reputation in Australia in respect of clothes.9.Because of the reputation of the KATY PERRY trade mark matters alleged in paragraphs 8 and 8A of this Further Amended Statement of Cross-Claim above, the use of the Katie Perry Mark would be likely to deceive or cause confusion.10.By reason of the matters pleaded in paragraphs 8, 8A and 8A9 (sic) of this Cross-claim above, registration of the Katie Perry Mark:(a)could have been opposed on the ground provided under section 60 of the TM Act; and(b)is liable to be cancelled under section 88(1)(a) of the TM Act on the ground set out in section 88(2)(a) of the TM Act. (Strike out and underlining in original.) The second proposed amendment concerns the claim made for cancellation of the Applicant’s Mark under s 88(2)(c) of the TM Act which provides:(2)An application may be made on any of the following grounds, and on no other grounds:…(c)because of the circumstances applying at the time when the application for rectification is filed, the use of the trade mark is likely to deceive or cause confusion; The claim, incorporating the amendment, would be as follows:20. By reason of:(a)the matters in paragraphs 8, 8A, 11, 12 and 15 of this Further Amended Statement of Cross-claim above;(b)the Cross-claimants’ reputation in the KATY PERRY mark from before the Priority Date to the date of this Cross-claim; and(c)the extent of the Cross-Respondent’s use of, and reputation in, the Katie Perry Mark in relation to clothes up to the date of this Cross-Claim,the circumstances at the date of this Cross-claim are that use of the Katie Perry Mark is likely to deceive or cause confusion.(Underlining in original.)

Ratio Decidendi

Legal Principle Established

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