PRD SV/ItT4 se = ae f Vic Ni 'Ye IN THE FRDPRAL COUNT OF AUSTPALTA ) NEW SOUTH VALES DISTRICT RuGTSPRY G.No.14 of 1979 GENTRAL DIVISICN a) BETWEEN: McDOMALD'S SYSTEM C7 AUSTRAT.T. PTY. LINTLED Applican AND: McWTLUIAM'S WINES PTY. LIMITVD First Respondent AND: JOHN FAIRFAX AND SONS LTO D Second Respondent Coram: Freanki d. Svaney 20 April 1979 REASOMS FOR JUDCMENT FRANKI_J.: This is an applicetion for interan relief under s.8d of the Trade Practices Act 1974 ("the Act") scehkang to restrain the first respondent from using the words "Big Mac". The applicant also sought to restrain John Fairfax and Sons Limited, the second respondent, from publishing any advertisement for the first respondent's wine incorporating the words "Big tac". At an early stage of the proceedings the applicant, because of an arrangement it had reached with the second respondent, no longer sought any interlocutery relief against it. The application is based on an allegation of conduct in contravention of s3.52(1) and 53(c) and (d) of the Act. It is no longer necessary to set out in detail the general approach which this Court should make to interim relief in this case. The question of the proper approach has been considered by the High Court in Hornsby Ruilding ee. Information Cenize Pty. Ltd. v. Sydney Building Information ee en Med se er a ne Centre Ltda. (1978) 18 A.L.R. 639, World Series Cricket Pty. Ltd. v. Parish (1977) 16 A.L.R. 181, Commercial Panik of Australia Ltd. v. Insurance Brokers Association of Australia (1977) 16 A.L.R. 161, Weatmann v. Katies Ltd. (1977) 29 F.L.R. 335, United Telecasters Sydney Ltd. v. Pan Hotels International Ltd. [7978] A.T.P.R. 40,085 and Elina Australie Pty. Ltd. v. A.P, Harding & Co. Pty. Ltd. [1978] A.T.P.R. 40,096. The proper approach to interlocutory injunctions in general has also been dealt with by the Full Court of this Court 2n Victorian Hes lierketing Foerd v. Parkwood Ersrs Pty. Itd. (1978) 20 A.L.R. 129 and by the New South Wales Court of Appeal in Shercliff v. Engadine tcecentance Corncration Pty. Ltd. [1978] 1 N.S.W.L.R. 729. I have to consider first of all whether a prima facie case in the relevant sense has been made out and then to consider the balance of convenience. So far as concerns the question of a prima facie case it is clear that I must approach the question upon the basis acopted by the Haigh Court in Beecham Group Ltd. v. Bristol Laboratories Pty.Ltd. (1968) 118 C.L.R.618. I consider it is, however, -3- clear that the Court's function 1n considering this application is not to conduct a preliminary trial or to fore- cast the result of the case, nor indeed is it necessary that the applicant should establish that it is more Jakely than not trat it would succeed if the evidence remeins as it is in the application for interim relief. It is sufficient that "if the evidcnce remains as it is, there is a probability that at the trial of the action, the plaintiff will be held entitled to relief". There was uncontested evidence before me that the applicant runs 89 retail stores throughout Australia. Stores are run in all States except Westezn Australia and Tasmania and about half of these are operated by the holders of franchises. These stores fall into the category of whet are often called fast food stores. There are facilities for customers to sit down and eat although a significant proportion of custemers take their food and @rinks away with them. Each of the stores sells substantially the same range of products which include hamburgers, deep fried chicken, votato chips, milk shakes ard soft drinks. One of the products sold in the applicant's stores is advertised under the name "BIG MAC" and is a particular type of hamburger. The total retail sales in the applicant's stores in Australia in 1978 was about 051 million and it is estimated that this ycar the figure will increase to about $80 million. In 1978 tne total number of transactions was in excess of 23 million. About 20% cf these sales were of the "Big Mac" hamburgers. <A great deal of advertising -h- including extensive television adveitising associated with World Serses Cricket matches was in evidence. Thais advertising was during the 1977/78 and 1978/79 cricket seasons in Australia and the words "Mc Dorala's Big Mac" were prominently displayed.- A lerge ancunt of display material advertising the product "Big Mac" in association with the name McDonald .as also in eviderce. It secs that the advertising cf "Big Mac" has been so extensive that for the purposes of this application I should accept that it has had an impact on many members of the public,at least in a number of capital cities in Australia. The first respondent published a particular advertisement on 14 March 1979 1n the"Daily Telegraph"and « in the na Sun" and on 15 March 1979 in the "Daily lizrror" and the "Courier Mail". These newspapers are daily newspapers, the first tiree being published in Sydney and the last in Brisbane. Each of the advertisements were the same and showed pictures of the three bottles of wine, each two litres in size, and a number of glasses filled with wine. The advertisements also contained various comments by persons described as "Top wine writers". The comments were about "Rosedale Dry Red" and the labels on the bottle featured the name "McWilliam's" and "Rosedale" and described the contents of one bottle as "Dry Red Table Wane", another as "Medium White Table Wine" ans the third as "Dry White Table Wine". One of the comments was by a Mr. Peter Wilson who said about the wine that "I call it the 'big Mac'", The main compiaint of the applicant about the advertiseront was the appearance on the top of the advertiser=nt of the words "Big Mac" in letters about 34 centimetres in height and extending over the maj Go ea part of the top of the page. Above these words apoe ine the word "Uicllzlliam's" in letters ahout 13 centimetres in height. Application was made to me on Friday 16 March and I granted an interim injunction which, in substance, restrained the use of the words "Big Mac" by the respondent in trade or commerce, in connection with edvertisirg wine until the following Monday when the ratter was listed before me. I have cxtended this inyguuction ard 1% 1s still in eperation. It was not possible to deal wich the application without some adjournments and the hearing has occupied the Court for the equivalent of almost three days. The applicant cleimsthat the use cf the words "Big Mac" by the respondent constitutes,in trade cr comzerce, engaging in conduct that is misleading or deceptive or is lakely to mislead or deceive withan s.52(1) of the Act. It also claims a contravention of s.53(c) of the Act and alleges that the advertisement constitutes a representation in trade or commerce in connection with the supply or pcssibsie supply of wine or in connection with the promotion by any means of the supply of wine that the wine has a sponsorship or approval which it does not have. It also alleges a contravention of s.534(d) of the Act that in the same way, the advertisement represents that the respondent has a sponsorship, approval or affiliation which 1t does not have. -6- The applicaut said that it relicd more on s.53(c) and (d) than on s.52(1). There was evidence before me about the way ia which the respondent came to use the words "Big Mac" but an these interlocutory proceedings I do not consider it necessary or appropriate to decide precisely how this occurred, There was evidence of a survey which had been confucted by a market research consultant. The evidence was that "trained market research interviewers" went to various suburbs in Sydney with questionnaire forms. These forms askec two questions; (1) "What does a McWilliam's Big Mac mean to you?" and (2) "Where would you expect Lo buy a NewWilliam's Big Mac?" Space was provided for written ansvers to these questions by the person te:ng interrogated. Forty seven questionnaire forms were tendered without objection. Even for the purpose of an interlocutecry application 1t is extremely difficult to draw any valid conclusions from answers to such questions. In saying this I am not in any way being critical of the formulation of the questions, or the conduct of the . survey but one must be extremely cautious drawing any conclusions from material which is no more than the answers to tivo questions and where there is no cxplanation of the background knowledge of the person answering the guestions nor are the persons answering subject to any cross-examination. It is however clear that a number of -7- people understood the words "licW2lliam's Big iiac" to mean a hamburger which wovld appear probably to be based on a knowledge of the applicant's product. It is amiliar with a HH fo oO also clear that sone pcop ¥$ ) ve reputation in the first respondcnt for wine. The applicant's promotion of the words "Big Mac" appears to have been as a description of one of its products rather than as an identification of the applicant. However, it seems not unlikely that the applicant's advertisements have been so extensive that a very significant section of the community would associate the words "Big I'ac" wth the applicant. Of course the only use of the words "Big Mac" by the first respondent has been in association with the word "MceWrllian's" and it may well ultimately emerge that this 1s sufficient to distinguiseh any product described as "Big Mac" from any product of the applicant, parvicularly where the applicant's products are, on the evidence, only sold in its owm stores. Although the applicant sells soft drinks it does not at present sell any form of alcoholic beverage. I consider that s.52(1) refers to conduct that is misleading or deceptive or likely to mislead or deceive at the time when it takes place. In Weitmann v. Katies Lid., supra, JT had to consider ss.52(1) and 54(c). In relation to s.52(1) I consider that ultirately the applicant will have to establish that the use of the words "McWilliam's Big Mac"! would be laixely to deceive or mislead a significant number of purchasers or potential purchasers into considering that its goods came from or had some relevant connection with the applicant. Whilst this inay be a -~-8- difficult task in view of the use of the words "Big Mac" as a description of one of the applicant's products and the use by the respondent of the qualification "licWalliam's" and to the reputation which appears 11kely to exist an the word "McWilliam's" as identifying wines of the respondent, I consider that the applicant at least has a probability of success although indced failure may well be more likely than success. Passing now to s.53({c) I expressed a view in Weitmaun v. Katies Ltd., supra, at p.344, that the word "sponsorship" in the context of that section secicda to me, when used in connection with trade marks cr trade neues, to envisage something more along the lines of @ certificatic: mark. However, it may be that the applicant can establish that by the use of the words "Big; Mac", even associczted with the word "MciWilliam's", the first respondent an connection with the promotion of the supply of wine, has represented that the wine has a sponsorship whushit does not have. The same can be said about the applicant's submission that the use by the first respondent constitutes a representation that the wine has "an approval" which it does not have. One person answering the survey thought that McWilliam's was a subsidiary of the applicant and although one such opinion did not appear to be sufficient to satisfy the requirements of s.53(d) nevertheless in my opinion there is an issuc to be determined and it cannot be said that the applicant has no prospect of success on this point. -9- I consider that at this stage I should take the same approach to the argument presented by the applicant an respect of s.53(d). I consider that the applicant has just established a "prima facie" case, at least in relation to its reliance on s.52(1). In my opinion this is a case where the balance of convenience is the decisive factor. What I have said so far deals with the first aspect about which I have to be satisfied and that is that the plaintiff has made out a prima facie case. There is evidence of certain "point of sale" material which could not be used but I am inpressed by what appears to me to be a lack of substantial darage that 1s likely to flow to the first respondent if it is restrained from using the words "Big Iiac" which could not be made gocd by the usual undertaking as to danages. The first respondent has sold its "Rosedale" wine since November 1973 and since the grant of interim relief 1% has advertised that wine in a way almost identical with that of which complaint is made except that the words "Big Mac" have not been used. The newspaper advertisements of 14 March 1979 were the first public use by the first respondent of the words "Big Mac", The applicant appears to have advertised its hamburgers so widely as "Eig Mac" that, although the balance of convenience is mainly to be decided by comparing the likely damage to consumers if no injunction is granted with that which the first respondent is likely to suffer if the injunction is granted, but not made perpetual at the final hearing, I consider that I am entitled to have some regard to the desirability -~-10- of preserving the status quo. I have not overlooked the dirference between a passing off action, where there 1s a relevant question of protecting the goodwill of the applicant, and a procecding based on s.52 where the protection of the public is the primary consideration. On the last day on which this matter was before me the first respondent offered an undertaking to the Court that it would not use the words "Big Mac" except in association with the word "McWilliam's", The applicant, of course, has indicated that if any interlocutory relief is continued it will continue the usual undertaking which it has given since my first order in this matter. However, for the reasons I have stated, I do not think the applacant should be required to be satisfied with the undertaking offered by the farst respondent. I am of the cpinion that upon the basis vehe applicant gives the usual undertaking as to danages, I should grant an injunction until the hearing of the suit or further order. I consider that every effort should be made to have the final hearing as soon as possible and if there is any unreasonable delay on the part of the applicant I am prepared to entertain an application to discharge the interlocutory injunction. The injunction which I propose to grant is that McWilliam's Wanes Pty. Ltd. be restrained until the hearing of the action or further order, by 1ts servants or agents, in trade or commerce, in connection with the supply of wine or the promotion by any means of the supply or use of wine, from publishing or wenger = + -— -41- procuring or authorising the publishing of any advertisement incorporating the words "Big Mac", Liberty is granted to the first respondent to apply to a judge of this Court upon two days notice to the applicant should it wish to apply to discharge the interlocutory ingunction upoen the ground of unreasonable delay by the applicant. The parties are left to address me upon the question of costs. Terre Ue tras ad ble "Tew, ' ces a7e a tree cony of 4} the rv Judenent hercin of his Yorour | e@ PRANK j Psu 3 JS Coat U Associate Dated: LO Aah AIM