oO rv) Ta, CATCHWORDS Trade Practices - Misleading and deceptive conduct -— production of books similar in content, size, shape and get-up - whether deliberate copying relevant - injunction. Trade Practices Act 1974 ss. 52, 80. THE TERRACE TIMES PTY. LIMITED v. PAULA BROCK, ALISON LEWIS DIANA HANCOCK, . INVESTIGATOR PRESS PTY.LIMITED AXIOM BOOKS PTY. LIMITED and KINGFISHER BOOKS PTY. LIMITED No. G54 of 1981 Coram: McGregor J. Sydney 25 June 1981 IN THE FEDERAL COURT OF AUSTRALIA NEW SOUTH WALES DISTRICT REGISTRY No. G 54 of 1981 GENERAL DIVISION BETWEEN : THE TERRACE TIMES PTY. LIMITED Applicant AND : PAULA BROCK, ALISON LEWIS, DIANA HANCOCK, INVESTIGATOR PRESS PTY. LIMITED, AXIOM BOOKS PTY. LIMITED and Respondents ORDER JUDGE MAKING ORDER: McGregor J. DATE OF ORDER: Thursday 25 June 1981 WHERE MADE: Sydney THE COURT ORDERS THAT: 1. The respondents, Paula Brock, Alison Bothwell Lewis, Diana Hancock, Investigator Press Pty. Limited, and each of them by themselves and their servants and agents be restrained from printing, publishing, distributing, selling, offering for sale, promoting, displaying or advertising a book entitled "Heritage Recipes, Book One, Historic Eating Houses of Adelaide" by Paula Brock, Diana Hancock and Alison Lewis. 2. Except for the costs of the hearing on 20 May 1981, the respondents are to pay the applicant's costs. 3. The applicant 1s to pay the respondents! costs of the proceedings on 20 May 1981. 4. Liberty to apply to either party on two days! notice in respect of enquiry as to damages and parties to be bound by these orders. REASONS FOR _ JUDGMENT THE TERRACE TIMES PTY. LIMITED (Applicant) is the publisher of a series of books each entitled "The Terrace Times (Minimum effort Maximum effect) Cook Book". There are already in existence six such books, four of which in title refer to Sydney or some area in Sydney and one to Melbourne; another is sub-titled "Looking at Cooking". According to uncontradicted evidence of Helen Arbib, the publisher and a Director of the applicant (to be mentioned later), since 1975, 250,000 of these books have been sold in all States and territories of Australia. There has been conducted over the years, with help from the public media, a considerable promotion of them, details of which are set out 1n documents and in excerpts from publications with circulation in Australia and national magazines particularly those which purport to deal with women's affairs. All the books have a consistent design and layout and the same size and elongated shape. They contain 64 pages of recipes with drawings and notes of historical interest; the exception being "Looking at Cooking" which is fractionally larger in size and is 80 pages of recipes without historical content. Pauline Clements and Kay Stewart participated in the design of and drawings in various of the five books concerning Sydney and Melbourne; their names appear on the covers of the respective books with which they were concerned. ALISON BOTHWELL LEWIS (Second Respondent) 1s an artist who for some time had been aware of the existence of this series of books. In or about March 1980 she wrote to Helen Arbib, asking if the applicant would be interested in including in future editions, drawings done by her. The said Helen Arbib replied in a letter of 15 March 1980 stating that she would be unable to use the services of the second respondent. She gave as one of the reasons that - "Pauline Clements and Kay Stewart, although completely indivadual in their approach to buildings, both have a remarkably similar kind of style that I would like very much to try and match again as a kind of Terrace Times "hall-mark" if I can." There was other correspondence but no change of the decision by Helen Arbib. I find that before March 1980 the applicant's books were well known and with an established reputation in Australia associated withthe applicant recognised by persons interested in cooking or recipe books. Following the correspondence above, the first three respondents decided to do something "similar" themselves. The unchallenged evidence of the second respondent is that the first respondent said to her - "Let's do something similar ourselves. I will edit the recipes, you can do the drawings and we will find someone else to do the history." PAULA BROCK (First Respondent), the second respondent and DIANA HANCOCK (Third Respondent) thereafter produced a book (the book), 1ts front page headed or titled "Heritage Recipes Book One, HISTORIC EATING HOUSES OF ADELAIDE". It was printed by L.P.H. Adelaide apparently by arrangement with a publisher INVESTIGATOR PRESS PTY. LIMITED (Fourth Respondent). The respective roles of first three respondents are referred to in a newspaper cutting in evidence dated 10 December 1980. It seems from that excerpt that the first respondent was concerned with collection and testing of recipes, the second respondent with illustrations and the third respondent with writing and historical notes. The book has been promoted by Myers Adelaide, November 1980 and April 1981 and Myers Melbourne in 1981. The first three respondents have agreed with AXIOM BOOKS PTY. LIMITED (also referred to as AXION BOOKS PTY. LIMITED) (Fifth Respondent) to be its sole distributor in South Australia and Northern Territory and with KINGFISHER BOOKS PTY. LIMITED (Sixth Respondent) that 1t will be the sole distributor of their books in New South Wales and Victoria. The book came on the market 1n November 1980. By January 1981 the edition comprising 5,000 books was sold out. It has been reviewed by newspapers and discussed on the media by the second respondent. The fifth respondent has now advised that it will no longer act as a distributor. All of these recited facts are admitted or asserted without denial or proven to my satisfaction. 5. The Trade Practices Act 1974 Part V 1s headed - "CONSUMER PROTECTION Divasion 1 - Unfair Practices" Relevant sections therein include - $.52 "(1) A corporation shall not, in trade or commerce, engage in conduct that 1s misleading or deceptive or is likely to mislead or deceive." (2) weneee s.80 "(1) The Court may, on the application of - (a) neces (b) wee ee (c) ...... —- any other person, grant an injunction restraining a person from engaging in conduct that constitutes or would constitute - (d) a contravention of a provision of Part lV or V; (e) attempting to contravene such a provision; (£) aiding, abetting, counselling or procuring a person to contravene such a provision; (g) .eeeeee (h) being in any way, directly or indirectly, knowingly concerned in, or party" to, the contravention by a person of such a provision; or (J) «eee, (1A) ...... (2) Where in the opinion of the Court 1t 1s desirable to do so, the Court may grant an interim injunction pending determination of an application under sub-section (1). 6. (3) The Court may rescind or vary an injunction granted under sub-section (1) or (2). (4) Where an application is made to the Court for the grant of an injunction restraining a person from engaging in conduct of a particular kind, being conduct referred to in sub-section (1), the Court may - (a) if it is satisfied that the person has engaged in conduct of that kind = grant an injunction under sub-section (1) restraining the person from engaging in conduct of that kind; or (b) if in the opinion of the Court it is desirable to do so ~ grant an interim injunction under sub- section (2) restraining the person from engaging in conduct of that kind, whether or not it appears to the Court that the person intends to engage again, or to continue to engage in conduct of that kind. (5) Where an application is made to the Court for the grant of an injunction restraining a person from engaging in conduct of a particular kind, being conduct referred to in sub-section (1), the Court May - (a) if it appears to the Court that, in the event that an injunction 1s not granted, it is likely that the person will engage in conduct of that kind - grant an injunction under sub-section (1) restraining the person from engaging in conduct of that kind; or (b) if in the opinion of the Court it is desirable to do so - grant an anterim injunction under sub- section (2) restraining the person from engaging in conduct of that kind, 7. whether or not the person has previously engaged in conduct of that kind and whether or not there is an imminent danger of substantial damage to any person if the first-mentioned person engages in conduct of that kind. (6) .eneeee (7) vec eeee" Of s.52(1) - and before the addition thereto of the words ".....0r is likely to mislead or deceive....." (see Act No. 81 of 1977 5.29) - Stephen J. said in Hornsby Building Information Centre Pty.Ltd. v. Sydney Building Information Centre Ltd. (1977-1978)140 C.L.R. 216 at p.223 - "Section 52(1) of the Act 1s expressed in wide terms and its generality is expressly preserved by sub-s. (2). Its operation requires the existence of three factors, a "corporation", 1ts engagement in conduct answering the description of "misleading or deceptive" and the occurrence of that conduct "ain trade or commerce". If each of those factors be present a contravention of s.52 will occur." « The applicant claims that the respondents in trade or commerce have engaged in conduct that 1s misleading or deceptive or likely to mislead or deceive. The applicant claims that the respondents have written, published and distributed the book, that it 1s deceptively similar to 8. the applicant's books, has misled and deceived and is likely to mislead and deceive people into believing that it is the applicant's book or one of its series; and that the various respondents have aided and abetted each other. The applicant contends that the requirements of s.52 referred to by Stephen J. (supra) are all present viz. trade or commerce, corporation, proscribed conduct. The evidence may be referred to from when the first three respondents were minded to "do something similar". The second respondent took her drawings to Barbara Deverson of the fourth respondent with two books of "The Terrace Times" series and said - "We want to publish something similar to this locally". Certain arrangements were made with restaurants not necessary to detail. A letter from the fourth respondent to second respondent bearing date 8 April 1980 stated (inter alia) - "As requested prices have been obtained on the Heritage Cook Book, patterned on the sample submitted, 1.e. fully bound cover, 64 pages, elongated format". About August 1980 (a date which appears in the second respondent's affidavit of 20 May 1981) respondents' materials had been collected and were submitted to the fourth respondent which prepared and submitted a proof to them. Each of the first three respondents had one copy of it; there may have been a fourth copy. They decided on printing in two tones 1.e. sepia and black. The book as produced includes on its cover - "Heritage Recipes Book One HISTORIC EATING HOUSES of ADELAIDE" The second respondent also gave viva voce evidence that the inspiration for the book was applicant's books; that " " we" were inspired by its format, by its concept; that she was looking for the same market and possibly the same purchasers. She said that before this hearing the book had sold in South Australia and Victoria; she was preparing to sell it in other states of Australia; but when she swore her affidavit she had no present intention to use areas outside South Australia as the subject matter of her publication. She did not agree that the fourth respondent when writing of the "sample submitted" was referring to the applicant's books. Barbara Deverson of 'the fourth respondent was not called. My own view 1s that in these words the writer did mean to refer to the applicant's books; though as Stephen J. pointed out (ibid p.228) s.52 involves "no questions of intent upon the part of the corporation whose conduct is in question." However, with this background, it is not surprising that the respondents' book bore a resemblance (at least) to those of the applicant. lo. Affidavit evidence was also given by Naom1z Mendelson, who is very familiar with applicant's books, that on 8 May 1981 she saw displayed in Melbourne the applicant's books and, next to them, the respondents' book. She immediately thought the respondents' book was one published by applicant; and continued so even after some examination until she saw the respondents' names on the bottom of the front cover. Jill Dawkins, in her affidavit of 19 May 1981, was also familiar with applicant's books. In April 1981 she saw respondents' book 1n a shop in Camberwell, Victoria and thought it was a new addition to the series; having leafed through it she continued to believe it was applicant's book or one very Similar to the series. Kay Egerton knew the applicant's books well, having illustrated for the series. In the beginning of May 1981 she saw the respondents' book in Camberwell, Victoria. Having examined it she thought it a "Terrace Times" Book; until she examined the front inside pages. A significance of the evidence of these three witnesses is that all were already familiar with applicant's books and therefore an informed critical audience. They were not cross examined. There is no reason to disbelieve them. All at least initially made the mistake of accepting the respondents! book as that of applicant. This state of mind does not determine what should be the result of this action. I must form my own conclusion as to whether the conduct of the respondents in their actions related to production and publishing amounts to the conduct referred to in s.52. ll. This conclusion ought not be reached merely by a piece-by- piece or statistical analysis of similarities between two articles. Yet such an exercise can be helpful to assist to understand how one may have been persuaded to or led to an opinion or conclusion; or as to what may be the effect on the public of respondents' conduct 1.e. to decide objectively whether the conduct of the respondents in producing the book is misleading or deceptive or likely to mislead or deceive; or has the capacity to deceive. My own inspection of the books has eventually been a detailed one, educated by the observations of Counsel and of evidence. Quite apart from knowledge or reference to individual points of comparison, my first impression was that the applicant's and respondents' books were strikingly similar. I continue to retain that impression though made aware by evidence, examination and submissions of differences. I noted on a close inspection, that the books' dimension, thackness and shape corresponded; the shape, if not unique, was at least very unusual; and that the use of decoration, an which iron lace is prominent, 1s a common theme on the glossy hard covers. There is a sketch or depiction in an oval 1n the centre of the cover of applicant's Paddington edition. On the "Heritage Recipes" 1s an oval of the same shape and size and with an illustration in it. 12. The applicant's books are a series, presently up to book six; the "Heritage Recipes" expresses the notion of a series on ats cover - "Book One". And that is the intention. The illustrations inside all books include reference to older city or nearby buildings or interiors or aspects, with historical notes added. All books contain recipes. Even the price statement - $3~-95, $4-95, $5-95 is similar. When the second respondent's "inspiration" 1s recalled and it is remembered that two copies of the applicant's books were delivered to the fourth respondent before the "Heritage Recipes" was produced, the impression received is understandable, even predictable, whether or not in the words of Cotton LJ. in Slazenger & Son v. Feltham & Co. (1889) 6 R.P.C. 531 at 538 the respondents were "straining every nerve" to achieve this. Any practice of exhibiting books with similar subject matter in selling outlets in groups would assist further to promote misleading and deception of the public. The evidence shows this has 'happened anyway. I accept that the production of cook books ina series is unusual; so the production of a new recent book which itself suggests it 1s to be one of a series may be part of conduct which is misleading and deceptive, or likely to mislead or deceive. 13. It 1S not necessary to decide whether there was a deliberate attempt on respondents" part to mislead or deceive by copying the applicant's books. In so far as such an implication of an intent to copy may arise from the presence merely of lace decoration on the "Heritage Recipes" book, respondents' Counsel tendered and I have seen and admitted into evidence as Exhibit 5 the "mock up" of the cover of a proposed second book by the respondents which does not have any lace on it. It is intended that the marketing of respondents' books will be continued; a distributor has been engaged; their second book, as mentioned, is already in course of preparation. In my view, the "three factors" referred to by Stephen J. (above) are present here. By reason of the striking similarity of respondents' book to those of the applicant, the respondents have, 1n combination, in trade or commerce engaged in conduct that is misleading or deceptive or is likely to mislead or deceive, in that e.g. members of the public have been and are likely to be misled or deceived into accepting that the respondents' book 1s one produced by applicant, or part of its series; or that the books came from the same source; or were produced by the same persons. 14. I find that respondents have in trade or commerce engaged 1n conduct which is misleading or deceptive. I consider that unless restrained the respondents will in trade or commerce continue to engage in conduct that is misleading or deceptive or that is likely to mislead ox deceive members of the public as consumers. Further, the respondents and each of them have aided and abetted each other. Were it necessary so to find, I would be prepared to make a finding that members of the public would at least - ".....-be caused to wonder whether it might not be the case that the two products came from the same source." See per Kitto J. in Southern Cross Refrigeration Co. v. Toowoomba Foundry Pty. Ltd. (1954) 91 C.L.R. 592 at 595. Though I propose to order that applicant should have the costs of the action generally, I accede to Mr. Hely's application as to the hearing on 20 May 1981 when he was ready to proceed and, as was appropriate, the second respondent was in Court. 15. An enquiry as to damage referred to in the Statement of Claim was sought in final submissions and was not the subyect of further submission. No submissions were made as to what orders should be sought against the fifth and sixth respondents. I give liberty to apply to either party on two days' notice with respect to an enquiry as to damages or to these orders. 1 Yy that this and the fGen Cs) Pr cng pages are a true copy of + > Reasons for Judgment herela of his Honour Mr. Justice McGregor, ef Associate 16. I order that - Dated: 25 Ana (4e\ 1. The respondents, Paula Brock, Alison Bothwell Lewis, Diama Hancock, Investigator Press Pty. Limited, and each of them by themselves and their servants and agents be restrained from printing, publishing, distributing, selling, offering for sale, promoting, displaying or advertising a book entitled "Heritage Recipes, Book One, Historic Eating Houses of Adelaide" by Paula Brock, Diana Hancock and Alison Lewis. 2. Except for the costs of the hearing on 20 May 1981, the respondents are to pay the applicant's costs. 3. The applicant jis to pay the respondents' costs of the proceedings on 20 May 1981. 4. Liberty to apply to either party on two days' notice in respect of enquiry as to damages and parties to be bound by these orders.