The Zone Corporation Limited v American Express Marketing & Development Corporation HC Wellington CIV-2011-485-1274

[2011] NZHC 979

IN THE HIGH COURT OF NEW ZEALAND WELLINGTON REGISTRY

CIV-2011-485-1274

BETWEEN  THE ZONE CORPORATION LIMITED Plaintiff

ANDAMERICAN EXPRESS MARKETING & DEVELOPMENT CORPORATION Defendant

Hearing:         1 September 2011

Counsel:         A Brown QC for plaintiff

K J Duckworth and T Huthwaite for defendant

Judgment:      7 September 2011

RESERVED JUDGMENT OF DOBSON J

Nature of the dispute

[1]      This judgment deals with an application on behalf of the plaintiff for interim orders injuncting the defendant from conduct which, in its substantive proceedings, the plaintiff alleges would constitute infringement of the plaintiff’s trade marks, and also allegedly constituting passing off and breach of the Fair Trading Act 1986.

[2]      The plaintiff is based in Wellington.  One of the principals of the businesses operated by it, Mr Theo Doucas, has deposed that he was previously an Assistant Commissioner of Trade Marks.

[3]      The  plaintiff  owns  a  number  of  trade  marks  registered  in  New Zealand, including ZONE, ZONE IP, TRADE MARK ZONE, TM ZONE, LEGAL ZONE, COMPANY ZONE and ZONE CORPORATION.  The trade marks were applied for

on a range of dates between November 2007, and July 2010.

THE ZONE CORPORATION LIMITED v AMERICAN EXPRESS MARKETING & DEVELOPMENT CORPORATION HC WN CIV-2011-485-1274 7 September 2011

[4]      The plaintiff operates two businesses.   The first, under the style TRADE MARK ZONE, is an on-line trade mark business targeted at small businesses or individuals seeking relatively straightforward trade mark services in terms of registration of trade marks and their protection.  The services are provided on-line, and are intended to appeal to small-scale entities responsible for between 7,000-

10,000 trade mark applications per year where the applicants do not use trade mark and patent attorneys or solicitors.

[5]      The  second  business,  conducted  under  the  style  of  ZONE  IP (originally ZONE  CORPORATION,  but  with  a  name  change  in  May  2010),  provides intellectual  property  advice  to  medium  and  larger  corporations  not  adequately catered for by on-line services.

[6]      A somewhat wider business providing legal advice on intellectual property to clients of other businesses is conducted by a separate company, ZONE LAW LIMITED, which has a trade mark licence from the plaintiff to use the ZONE mark.

[7]      Ms Karen Doucas has deposed for the plaintiff, on a confidential basis, to the extent of gross revenues for the businesses over the last three years.   That demonstrates that, from modest beginnings, the businesses are generating revenue on a not insignificant scale.  Ms Doucas further deposes that the plaintiff was the fifth largest filer of trade mark applications in New Zealand for each of the last two years.

[8]      The defendant is a part of the internationally recognised American Express commercial entity, most  widely known for its  provision of credit card services. Relevantly  to  the  present  proceedings,  in April  2011  the  defendant  launched  a website, to signal the development by American Express of a market  for  trading  in  intellectual  property  assets,  and  as  an  adjunct  to  that, facilitating referrals to third party providers of services to protect, value and enhance intellectual property assets.   As a part of initiatives pursued in a large number of countries, in May 2011 the defendant applied in New Zealand for the trade mark IP ZONE, in classes 35, 36, 41, 42 and 45.  The scope of that application is to be compared with the registrations achieved by the plaintiff for ZONE, registered in

respect of classes 35, 42 and 45, and ZONE IP, registered in respect of classes 35 and

45.

[9]      From the plaintiff ’s perspective, there is very substantial overlap between the services it provides within the classes for which its marks are registered, and those that are foreshadowed on behalf of the defendant, and as sought for the defendant in the scope of services listed in its trade mark application.  At the end of May 2011, solicitors for the plaintiff sought undertakings from the defendant’s New Zealand solicitors that the defendant would not use the trade mark IP ZONE in New Zealand. No positive response was received before these proceedings were commenced at the end of June 2011.

[10]     Mr Doucas  has  exhibited  a  trade  mark  compliance  report  issued  to  the defendant by the New Zealand Intellectual Property Office, dated 31 May 2011. That report raises, as an issue with the defendant’s application, the similarity of its proposed mark, with those of the plaintiff.

[11]     The defendant challenged virtually all elements of the grounds relied on for the plaintiff to obtain interim orders.  In support of its opposition, it filed an affidavit from Tracey Thomas, the chief intellectual property strategist for the defendant, who is based in New York.  That affidavit characterised the defendant’s initiative in the following terms:1

…the primary goal  of  the IP Zone  is to facilitate IP transactions.   The IP Zone achieves this by providing a forum for buyers and sellers to interact, and for service providers to engage buyers and sellers.  This forum will take the form of a virtual marketplace in which information about transactors and service providers is made searchable as well as pushed to participants.

[12]     The  affidavit  states  that  the  defendant’s  initiative  is  in  its  “beta”  stage, namely that it is in the course of being developed.  It is anticipated that it will be launched fully later this year, but there is no more specific information on timing

than that.

1 Thomas affidavit, 26 August 2011 at [8].

[13]     The Thomas affidavit also states that the services provided under the name IP Zone have never been expressly offered or advertised to New Zealand consumers, and that there has been no contact with any New Zealand company or individual in relation to IP Zone.  However, the affidavit continues:2

After   the   beta   phase   concludes,   there   will   be   no   impediments   to New Zealand  companies  or  individuals  or  in  New Zealand  in  general utilizing the IP Zone platform.

Issues

[14]     Submissions   for   both   parties   adopted   the   well-settled   sequence   of considerations on the Court’s jurisdiction to grant interlocutory injunctions, namely whether there is a serious question to be tried, where the balance of convenience lies, and what advances the overall justice of the case.3   The argument was unable to be completed in a full half day an accordingly leave was given to the plaintiff’s counsel to  file  the  remainder  of  points  in  rely,  in  writing.    Those  were  received  on

5 September 2011 and have been considered.

[15]     I turn first to consider whether there is a serious question to be tried in

relation to the plaintiff’s three causes of action.

Trade mark infringement

[16]     The plaintiff’s principal cause of action is for infringement of its trade marks. The elements required to be proven by the plaintiff vary, depending on whether its marks and that being used by the defendant are accepted as identical, or alternatively whether the relevant marks of each party are “similar”.   Under s 89(1)(a) of the Trade Marks Act 2002 (the Act), where a defendant uses, in the course of trade, a sign identical with the registered trade mark of the plaintiff in relation to any goods or services in respect of which the plaintiff’s trade mark is registered, then such use

is sufficient to constitute infringement.

2 Thomas affidavit at [23].

3      Klissers Farmhouse Bakeries Ltd v Harvest Bakeries Ltd [1985] 2 NZLR 129 (CA).

[17]     However, before getting to that issue, the defendant took a preliminary point that its activities based on its website, cannot constitute any trade in New Zealand using the impugned mark.   Ms Duckworth argued that promotion via a website from New York that is internationally accessible but not focusing in any  specific  way  on  New Zealand,  cannot  constitute  use  of  “IP  Zone”  in New Zealand.

[18]     The thrust of the plaintiff’s relevant complaint changed shortly before the hearing, with Mr Brown QC’s submissions characterising the present application as one on a quia timet basis so that it is not the present form of international promotion that is complained of.  Rather, that when that promotion, or any enhanced form of it, results in commercial activities with businesses or individuals in New Zealand, then infringing activity will occur at the point of such an engagement.  That change in approach means it is not essential, at least at this stage, to consider the point at which indiscriminate promotion from an internationally available website might be sufficiently targeted to the New Zealand jurisdiction, for the maintenance of that

website to constitute use in New Zealand.4

[19]     Here,  the Thomas affidavit acknowledges that  the promotion of the new services are accessible to those visiting the site from New Zealand, and New Zealand is not excluded from the jurisdictions in which its promotion is intended to canvass for business.  Once contact with customers in New Zealand is generated by the IP Zone website, and that leads to business for the defendant, then it is at least strongly arguable that such activity constitutes use of the IP Zone mark in New Zealand. Accordingly, the redefinition of the plaintiff’s complaint means that restraints are only  sought  to  the  extent  that  the  website  would  otherwise  be  successful  in generating business with firms or individuals located in New Zealand.

[20]     On a comparison of the parties’ respective marks, Mr Brown relied upon the

Court  of Appeal  decision  in  Anheuser-Busch  Inc  v  Budweiser  Budvar  National

Corporation  as  evincing  a  sufficiently  liberal  approach  to  the  analysis  of  what

4      See the authorities in [34] and [35] below for observations on the limits reasonably attributed to internet promotion.

constitutes identical marks, to extend that concept to cover the plaintiff’s mark, ZONE IP or simply ZONE, and the defendant’s use of IP ZONE.5

[21]     In  Budweiser,  the  Court  of Appeal  found  the  parties’ respective  use  of “Budweiser” and “Budweiser Budvar” to be identical for the purposes of the test now found in s 89(1)(a).  The Court held that the additional word did not obscure the identity, with Budweiser being used as the first word in the name tending to attract the eye because of its position in relation to the other words.6

[22]     That approach was treated as binding on the High Court in a subsequent decision  in  which  the  European  financial  institution  ABN  Amro,  which  had registered  marks  for  that  name  in  New Zealand,  sought  to  restrain ABN  Union Treasury Management Limited.7

[23]     I am not satisfied that these decisions necessarily require the acceptance of subtly differently worded marks as identical, merely because they each have the same first or dominant word in them.

[24]     Ms Duckworth argued that the different placement before and after the word “Zone” of the letters “IP” meant that the two should not be treated as identical.  She cited a dispute in relation to similar products where their names included “Silk” and “Sylk”, and where the two were treated as similar but not identical.8    However, in that case the prospect of the two marks being treated as identical was not pressed before the Court of Appeal.9    Mr Brown’s points in reply went so far as to suggest that the decision did not positively deal with s 89(1)(a).

[25]     At the present stage of this dispute, it is seriously arguable that ZONE IP and

IP Zone would be found to be identical marks.

5      Anheuser-Busch Inc v Budweiser Budvar National Corporation [2003] 1 NZLR 472 (CA).

6      At 498 per Gault P.

7      ABN Amro Holdings NV v ABN Union Treasury Management Ltd HC Auckland CIV-2004-404-

7200, 9 February 2005.

8      Geneva Marketing (1998) Ltd v Johnson & Johnson [2009] NZCA 591.

9 At [14].

[26]     On the wider constraint arising where marks are identical under s 89(1)(a), the remaining issue is whether the defendant is using IP Zone in relation to services in respect of which the plaintiff’s marks are registered.   From the plaintiff’s perspective,  Mr Brown  argued  that  the  range  of  services  foreshadowed  by  the promotional material on the defendant’s website covered at least aspects of the same services as are specified under the registration of the plaintiff’s relevant marks. Those include, for ZONE and ZONE IP, in class 45, the provision of intellectual property services, technical appraisal services in relation to intellectual property, establishment, exploitation and enforcement of intellectual property rights, licensing services, management of intellectual property rights, and legal services.

[27]     Mr Brown  urged  that  on  any  sensible  approach,  this  scope  of  services coincides or overlaps with the services described on the defendant’s website, and as summarised in the Thomas affidavit.  Again, on the preliminary assessment required at this stage, I am satisfied that the plaintiff has a serious question to be tried on this aspect of its infringement claim.

[28]     If  the  plaintiff  could  not  make  out  that  the  marks  are  identical  for  the purposes of s 89(1)(a), then it would need to establish under s 89(1)(c), in respect of similar marks, that identical or similar services would be offered by the defendant in circumstances that would be likely to deceive or confuse.  Ms Duckworth argued that the plaintiff would be unable to make out its claim on this alternative basis.  Both counsel addressed the hypothetical construction of what would occur if someone learning of the plaintiff’s services by word of mouth sought to access them electronically, by conducting an internet search using “IP ZONE” or “ZONE IP”.

[29]     For the purposes of the present debate, it was accepted that responses to an electronic search of this type via a search engine would most likely be dominated by references  to  the  defendant’s  website.    Ms Duckworth  suggested  a  reasonable qualification to that proposition, namely that if a Google search was done with a command that the responses be limited to pages from New Zealand, then it would be unlikely for the defendant’s website to be listed, whilst the plaintiff’s would be.  In reply, Mr Brown submitted that searches confined by country in that way would not occur without a positive step by the person conducting the search, and that at least in

a search via Google, the default position would be for a search to reflect websites world-wide.

[30]     Numerous issues idiosyncratic to attempts by would-be users of the services to engage them electronically would arise in determining this point.

[31]     For the plaintiff, Mr Doucas has deposed to a concern that small businesses or individuals who have had positive recommendations of his company by word of mouth, and who resort to a generalised internet search, would either not persist far enough to identify his website, or would be diverted by previous references to the services provided or arranged by the defendant.

[32]     Mr Brown  sought  to  draw  an  analogy  with  the  concept  of  imperfect recollection, often applied in assessing the prospects of confusion or deception in a retail consumer context.  This approach suggested that a person’s choice of service provider for trade mark or other intellectual property services could be influenced by a series of earlier references to the defendant’s site distracting potential customers of the plaintiff away from a subsequent entry linking to the plaintiff’s business.

[33]     On the other hand, Ms Duckworth suggested the analogy with “imperfect recollection” is inapt when decisions by customers on retaining skilled assistance with trade mark or other intellectual property services would not be made on the spur of the moment or cursorily.  Rather, it would be a serious step for even the smallest of  businesses  seeking  intellectual  property  protection  for  its  assets,  and  can reasonably be expected to be relatively thoroughly researched.   To the extent that that approach applies,  Ms Duckworth argued that there was no real prospect of confusion or deception because potential customers would persist until they found reference to a site conforming with the characteristics that had been favourably described  to  them.    The  location  of  the  plaintiff’s  business  in  New Zealand, contrasting  with  the  defendant’s  location  in  New York,  would  be  an  early  and important point of distinction.  So, too, the different emphasis of services described, with the defendant focusing on the promotion of a market for sale of intellectual property assets, whereas the plaintiff is plugging its efficiency in trade mark registration and protection.

[34] Ms Duckworth cited the observations of Jacob J from two Chancery Division decisions on the level of discernment that can reasonably be expected of those conducting internet searches. The observations in both cases are in the somewhat different context of the scope of “use” that can be attributed to a promotion on a website, as touched on at [17] above. First, in 800-FLOWERS Trade Mark,10  his

Honour observed:11

And if any web surfer in some other country happens upon that website he will simply say “this is not for me” and move on.  For trade mark laws to intrude where a website owner is not intending to address the world but only a local clientele and where anyone seeing the site would so understand him would be absurd.

[35]     Secondly, in Euromarket Designs Inc v Peters and Crate & Barrel Ltd:12

Now almost any search on the net almost always throws up a host of irrelevant “hits”.  You expect a lot of irrelevant sites, moreover you expect a lot of those sites to be foreign.  Of course you can go direct to a desired site. To do that, however, you must type in the exact address.   Obviously that must  be  known  in  advance.    Thus  in  this  case  you  could  get  to  the defendants’ site either deliberately going there using the address, or by a search.

[36]     I  am  inclined  to  agree  with  Ms Duckworth  that  a  substantial  portion  of potential customers of the plaintiff would not be confused or deceived by references to the defendant’s website thrown up in the course of an internet search.  However, that does not eliminate the prospect of a substantial number of potential customers being  confused  or  deceived,  at  least  in  the  initial  stages  of  attempts  to  make electronic contact with the plaintiff.

[37]     I note that in an appeal from the 800-FLOWERS decision of Jacob J referred to in [34] above, that Court concurred with the approach that had been adopted in the Chancery Division and observed that there is unlikely to be one uniform rule that can be applied in all cases of internet use.  The extent to which maintenance of a website outside  the  jurisdiction  might  constitute  infringement  of  a  mark  within  the

jurisdiction will, as in any other context, depend on the facts of each situation.13

10     800-FLOWERS Trade Mark [2000] FSR 697.

11     At 705.

12     Euromarket Designs Inc v Peters and Crate & Barrel Ltd [2001] FSR 288 at [23].

13     See  800-FLOWERS  Trade  Mark  [2001] EWCA CIV721, [2002] FSR 12, especially the comments of Buxton LJ at [136] to [138].

[38]     Mr Brown raised the prospect of “initial interest confusion” which may occur in attempts to locate goods or services, including by resort to internet searches.  He cited recent English authority that initial confusion may be relevant even if it is unlikely that it would persist up to the time of a sale or retainer.14    Accordingly, whilst it does not presently appear as the strongest part of the plaintiff’s case, if it were unsuccessful in making out infringement on the basis of identical marks under

s 89(1)(a),  and  had  to  establish  the  elements  required  for  similar  marks  under s 89(1)(c), then I am satisfied there would still be a seriously arguable case.

Other causes of action

[39]     Little  attention  was  given  to  the  plaintiff’s  alternative  causes  of  action, pleading passing off, and breach of the provisions of the Fair Trading Act.  On the present shape of the contest, there appear to be significant hurdles in the way of any successful claim for passing off.  The defendant’s services are based in New York and I anticipate that there will be some form of linking with American Express apparent  to  a  would-be  consumer  before  commitments  are made.   That  linking would, if the business is promoted in that way, make it difficult for the plaintiff to claim that any conventional form of passing off was involved.

[40]     Similar issues to those raising the prospects of deception or confusion that I have  reviewed  in  relation  to  s 89(1)(c)  of  the  Act  would  arise  in  relation  to complaints of breach of the Fair Trading Act.   Assuming the allegations in the Statement of Claim are prospective in the same way, then the cause of action for breach of the Fair Trading Act cannot be ruled out.  It may well be that if the plaintiff did not succeed for infringement of trade mark under s 89(1)(c), then its failure in that regard might also be sufficient to defeat claims under the Fair Trading Act.  At this stage, I would not be prepared to attribute any additional weight to the claims under the Fair Trading Act, as adding to the relative strength of the plaintiff’s case, in the overall assessment.

[41]     Nevertheless, for the present application I consider that it is sufficient that there is a serious issue to be tried with regard to the claims that dealings by the

defendant  with  businesses  in  New Zealand  would  constitute  a  breach  of  the

plaintiff’s trade marks.

The balance of convenience

[42]     On any view, a constraint on the defendant precluding its conduct of business in  New Zealand  until  resolution  of  these  proceedings  must  be  insignificant  by comparison with the scale of its world-wide initiatives.  The plaintiff could not, and has  not,  sought  to  affect  in  any way the  defendant’s  promotion  of  its  services elsewhere.   The Thomas  affidavit  specifies that  trade mark  protection  has  been sought in some 54 other countries, and the Court can reasonably infer from the terms of promotional material available via its website that its efforts, and presumably its intended business, will be focused on the United States and other large developed economies.

[43]     The evidence does not reveal whether the providers of intellectual property services to whom customers would be referred by the defendant are thus far confined to the United States, or have been recruited elsewhere.   Nor could Ms Duckworth clarify  how  it  is  intended  that  the  defendant  be  remunerated  for  facilitating references to third parties.

[44]     In these circumstances, a restraint pending trial that prevents the defendant from conducting business that might otherwise be generated by its website with entities in New Zealand cannot claim any material significance to the defendant.  No doubt records can be kept of the number of enquiries from New Zealand that may have led to remunerative business for the defendant, so that some indication of the scale of damages  will be calculable in  the event that  the plaintiff is ultimately unsuccessful.

[45]     For the plaintiff, the potential for the defendant’s activities to disrupt its business is significant.  It appears to have developed a meaningful extent of goodwill in the marks ZONE and ZONE IP in quickly establishing itself as the fifth largest filer of trade mark applications in the New Zealand market.  To the extent that initial contact by those wanting its services is undertaken via the internet, the existence of

the defendant’s site creates a real risk of diluting that goodwill, and disrupting the growth of the plaintiff’s business by a measure of confusion or deception.  Viewing the balance of convenience in this way, the plaintiff has a strong case for interim orders on appropriate terms.

[46]     Two other issues need to be taken into account on a wider assessment of the balance of convenience.  The first is the relative utility of orders that this Court has jurisdiction  to  make,  and  the  second  is  whether,  as  Ms Duckworth  argued,  the imposition of orders is not justified at this time because they would be premature.

[47]     I will set out below15  the terms of orders I consider to be appropriate to preserve, as best the Court could, the plaintiff’s position pending trial.   A major component of the plaintiff’s concerns is that the mere existence of the defendant’s website creates the confusion and deception that is likely to dilute the plaintiff’s goodwill.  Sensibly, the plaintiff accepts that it cannot seek any relief that is intended to affect the conduct of the defendant in maintaining its website for all jurisdictions from its base in New York.  The consequence is that there is a significant element of potential harm which cannot be addressed.

[48]     The Court is concerned not to grant relief, whether on an interim or other basis, where the orders will not have practical effect.  I am satisfied that this is not such a case.   Although there are forms of potential harm which are beyond the Court’s  jurisdiction,  a  meaningful  aspect  of  the  plaintiff’s  concerns  relates  to business that the defendant might transact with businesses located in New Zealand. It is at least arguable that transactions with businesses located in New Zealand would constitute an infringement of the plaintiff’s trade marks, or result from false or misleading conduct on the defendant’s part in breach of the Fair Trading Act.  I am therefore not dissuaded from granting forms of interim relief, on the ground that there would be a lack of utility in such orders.

[49]     The second issue is whether interim orders would be premature at this time. As Mr Brown observed, that will always be the case in the literal sense when orders are sought on a quia timet basis.   The statement in the Thomas affidavit that the

defendant  has  had  no  dealings  with  businesses  in  New Zealand  as  a  result  of maintaining its website is not challenged on behalf of the plaintiff. It is therefore common ground that there is no presently actionable conduct being undertaken by the defendant.   That is explicable on the basis that the defendant’s new business initiative is still in its development phase.

[50]     However,   Ms Duckworth   argued   that   the   prospect   of   the   defendant concluding  business  with  entities  in  New Zealand  is  too  remote  and  that  it  is therefore premature to  grant  orders until  it is at  least  a realistic and  proximate prospect.  With respect, the defendant has not been forthcoming as to the timing of its developments, and there is, conceptually at least, no limitation on the prospect of business  with  entities  in  New Zealand  in  the  relatively  near  future.    I  am  not persuaded that where, on other considerations the plaintiff is entitled to interim orders, orders ought to be withheld until some milestone is reached which makes it measurably more likely that such business would be concluded.

[51]     A further important consideration is whether damages would be an adequate remedy, if the Court does not grant orders now and the plaintiff subsequently makes out one or more of its causes of action.   In the account of profits sense, damage caused by virtue of business that the defendant might generate from New Zealand entities would be calculable.  However, it is virtually impossible to tell how much the possible availability of similar services from a New York entity trading as IP Zone has deflected away from the plaintiff, business it might otherwise attract in reliance on its growing goodwill in ZONE IP.  I am therefore satisfied that damages would not be an adequate remedy for the plaintiff.  It is relevant to this conclusion that the effect of orders can reasonably be seen to include discouraging the defendant from taking any initiatives to promote business in New Zealand.   That goes some distance to address the plaintiff’s concerns that the mere continued presence of the defendant’s website will cause forms of harm that the plaintiff cannot do anything about.

[52]     The complementary consideration is whether, if interim orders are now made but the plaintiff is subsequently held not to have been entitled to them, the plaintiff has sufficient resources to meet damages made out by the defendant.  That would

arise if the defendant could establish that it had incurred losses because of a restraint that the Court subsequently determines the plaintiff was not entitled to.

[53]   The plaintiff has indicated the immediate availability of $50,000 and volunteered an arrangement that such sum would be deposited in its solicitors’ trust account, pending further orders of the Court.  That may not assuage the defendant’s concerns if these proceedings were much protracted and significant business opportunities in New Zealand were lost because of interim orders.  However, in the short to medium term, an effective form of security for that amount is not insignificant.  Further, that offer of security is sufficient to rebut any argument that the plaintiff should not get any interim orders because of a concern that it would not be good for damages should it subsequently be held not to have been entitled to those orders.

[54]     A further concern raised by Ms Duckworth was that the terms of orders sought on behalf of the plaintiff, if granted, would leave the defendant in a state of uncertainty as to the extent of its activities that are prohibited until trial.

[55]     The terms of orders sought in the plaintiff’s amended application were cast as prohibiting the defendant from the following:

1.1      Infringing the plaintiff’s registered trade marks ZONE (trade mark

780203) and ZONE IP (trade mark 827638) by using the trade mark IP ZONE in New Zealand on or in relation to the services listed in those registrations.

The effect of an order in these terms is tolerably clear.  The defendant is prevented from making use in New Zealand of its mark IP ZONE until trial.  In the present case at least, maintenance of a website that is internationally accessible from outside New Zealand does not constitute use in New Zealand.  Electronic dealings between that website and electronic correspondence  sent  from addresses in New Zealand would, however, trigger use of the mark in this jurisdiction.

[56]     The second order sought was a prohibition in the following terms:

1.2Facilitating or offering to New Zealand businesses, individuals or service providers under or by use of the trade mark IP ZONE and via the website “  appraisal  services  in  relation  to  intellectual property, services in relation to the “…exploitation …of intellectual property rights; intellectual property consultancy…; licensing services including the licensing of intellectual property”; or

(b)       listing  or  providing  directory  services  in  respect  of  the following services “Intellectual property services; technical appraisal services in relation to intellectual property; … the exploitation … of  intellectual property  rights; intellectual property consultancy; licensing services including the licensing  of  intellectual  property;  management  of intellectual property rights; … legal registration services; research relating to intellectual property; searching of intellectual property; monitoring of intellectual property; … prosecution of applications for intellectual property rights; filing of applications for intellectual property rights; protection of intellectual property; … legal services … legal advice …”;

Consistently with the scope contemplated for the first order, the maintenance of the website “ in New York does not of itself constitute the facilitating or offering to New Zealand businesses of services of the types protected by the plaintiff’s marks.  However, once electronic communications are undertaken by any entities in New Zealand, then engagement in dialogue, whether electronically or by other means, would constitute facilitating or offering of such services if they are of the types specified in sub-paragraphs (a) and (b).

[57]     The third order sought, as discussed during the course of the hearing with

Mr Brown, is now in the following terms:

1.3Including New Zealand in any list of countries able to be displayed and selected on the website “ including in any country box;

The scope of that restraint is tolerably clear on its terms.

[58]     Accordingly, I am not satisfied that relief ought to be withheld on the basis that the scope of the restraint is unclear.

[59]   Before determining an entitlement to interim orders, the sequence of considerations requires the Court to stand back and assess the overall justice of the case.   Given the sequence of the considerations I have already undertaken, this residual check of the overall justice of the case adds little, despite being an appropriate reflection.

[60]     Given the closeness of the marks registered for the plaintiff, when compared with that sought by the defendant, the potential for overlap in the range of services offered respectively by each party and the form in which the defendant is using that mark on its website, there is a strongly arguable case of infringement in relation to any  activities  the  defendant  may  undertake  that  constitutes  use  of  its  mark  in New Zealand.  There is no suggestion that the defendant has deliberately copied the plaintiff.  Rather, given the dramatic difference in the scale of operations between the plaintiff and the defendant, it is a fair inference that that closeness is an unintended consequence of the defendant selecting a mark for a new business initiative pursued effectively on a worldwide basis, that coincidentally happens to use words that are already in use in New Zealand by the plaintiff.

[61]     An  appropriate  measure  of  restraint  on  the  defendant  in  relation  to  any activities with entities in New Zealand is of substantial importance to the plaintiff, but can only constitute disruption on a relatively insignificant scale to the larger business initiatives described for the defendant.

Outcome

[62]     In  all  those  circumstances,  the  overall  justice  of  the  parties’  positions reinforces the case for the orders sought.   Accordingly, the plaintiff is entitled to orders in the terms specified in [55], [56] and [57] above.  The entitlement to seal orders in those terms will be subject to solicitors for the plaintiff confirming in writing to the Court that the sum of $50,000 is being held in their trust account, pending further order of the Court, as contemplated in [53] above.

[64]     The parties are to liaise as to a timetable for steps to enable the prompt preparation of the claims and counterclaim for substantive hearing.   If the parties have not agreed a timetable for all steps by 16 September 2011, and conveyed that agreement in a memorandum to the Court, then the proceedings are to be called in the Judge’s Chambers List on 3 October 2011 for that purpose.

Dobson J

Solicitors:

Hunter & Co, Wellington for plaintiff

Baldwins Law Limited, Wellington for defendant