' a Judgement No. a (NOT FOR DISTRIBUTION) IN THE FEDERAL COURT OF AUSTRALIA VICTORIA DISTRICT REGISTRY No. VG 297 of 1986 www GENERAL DIVISION BETWEEN : BRASH HOLDINGS LTD, BRASHS PTY LTD, R.H. ELVY PTY LTD and B.A. WHITEHOUSE & CO PTY LTD Applicants and COMMODORE TELEVISION PTY LTD Respondent MINUTES OF ORDER COURT: Woodward d. DATE: 6 March 1987 PLACE: Melbourne THE COURT ORDERS THAT: 1. The application for interlocutory injunctions be dismissed. ~ 2. Costs be reserved. (NOTE: Settlement and entry of orders is dealt with in 0.36 of the Federal Court Rules.) IN THE FEDERAL COURT OF AUSTRALIA VICTORIA DISTRICT REGISTRY No. VG 297 of 1986 GENERAL DIVISION BETWEEN : BRASH HOLDINGS LTD, BRASHS PTY LTD, R.H. ELVY PTY LTD and B.B. WHITEHOUSE & CO PTY LTD Applicants and COMMODORE TELEVISION PTY LTD Respondent COURT: Woodward J. DATE: 6 March 1987 PLACE: Melbourne REASONS FOR JUDGMENT This is an application for interlocutory relief in a proceeding under the Trade Practices Act 1974 ('the Act'). The applicants claim that there are "certain distinctive features and styles" in their advertising of electronic audio and video equipment. They allege that the respondent has been using those distinctive features and styles in its own advertising of similar products, and that this amounts to misleading or deceptive conduct, within the meaning of s.52 of the Act, in that members of the public may be deceived into thinking there is a trade connection between the applicants' and respondent's businesses. They want such advertising stopped. applicant The distinctive features and styles relied on by the are - (a) a background grid pattern with advertised goods, together with text, overlaid in the foreground; (b) the expression "for advice and price"; (c) the expression "it's gotta go"; and (d) a distinctive typeface. It would be helpful at this point to set out a brief chronology of events: 1981 - 1981 - 1984 - 1986 - the applicants start using, as one of a number of type faces in advertisements, one that is said to be distinctive. the applicants start using a background grid pattern for their advertisements. the applicants begin using the expression "for advice and price" in their advertisements. the applicants first use the expression "it's gotta go" in advertisements. Examples exhibited are from 25/26 June 1986. 14 July 1986 - the respondent begins using in its advertising (1) a background grid pattern (11) the same type face which is said to be distinctive (iii) the expression "It's gotta go" (iv) the expression "The best in price - The best in advice". (None of these features had occurred in the respondent's advertising in the first six months of 1986. The inference is irresistible that these ideas had been borrowed (to use neutral language) from the applicants' advertisements). 12 August 1986 - the applicants' solicitor writes to the respondent alleging deliberate imitation of the applicants' advertising campaign and threatening action if appropriate undertakings are not immediately given. 14 August 1986 - respondent's solicitors reply saying that there is no substance to the applicants' allegations. 17 November 1986 - this application is filed. A number of points should be noted about the applicants' alleged distinctive features: (a) The background grid pattern used by the respondent is very similar, but material tendered by the respondent suggested that such patterns are quite commonly used in advertising, though seldom in the precise way in which it has been used in the present case. (b) The applicants' expression 'FOR ADVICE AND PRICE" does not occur in all advertisements and at first took the form "Right on for price and advice", using a quite different typeface - more like the one said to be distinctive. It always seems to be used at the foot of the page. The respondent has used the expression "THE BEST IN PRICE - THE BEST IN ADVICE", in a quite different typeface from either of those used by the applicants and at the head of the page. (c) The applicants' expression "It's gotta go", used for the first time in mid-1986, was sometimes used by the respondent in just the same way and in a similar typeface. It was so used from July to September 1986. In October 1986, quite different slogans were used and in November the expression "They've gotta go" was used. I understand that neither of the ".. gotta go" expressions has been used by the respondent since then, nor will they be used again - though no formal undertakings have been given. (d) The distinctive type-face alleged is referred to in a supporting affidavit filed on behalf of the applicants, which gives two instances of its use. Unfortunately these instances involve two different typefaces, though they are similar in some respects. Amongst the clutter of items, displayed with much accompanying material using a number of different typefaces, it is difficult to say that either of the typefaces said to he distinctive stands out. Perhaps the applicant is on strongest ground in relation to the price figures, using mainly white on black in each case and looking similar - though a closer examination reveals a number of differences. For the purposes of this interlocutory hearing, based on the evidence as it stands at present, I would make the following tentative findings concerning the advertisements; (1) The respondent did deliberately copy certain distinctive features of the applicants' advertisements; (2) Those advertisements which used not only the grid pattern but also the words "It's gotta go" could have led a person familiar with the applicants' advertisements to think there was some connection between the applicants' and the respondent's businesses. Any such impression would have been reinforced if the words "price" and "advice" were also juxtaposed in the particular advertisement. The type-faces chosen by the respondent, while adding little to the overall impression of similarity, certainly did not detract from it. The next question I have to consider 1s who might be deceived by the similarities described. Here the applicants are on weaker ground. The applicants, until now, have advertised in Melbourne and some other state capitals, but hardly at all in Sydney. The only evidence of their advertising in Sydney relates to advertisements on behalf of the third-named applicant, featuring different goods (pianos, organs and other musical instruments), which appeared in March 1983 and again 1985 and 1986. Those featured the grid pattern and some features of the allegedly distinctive typeface but neither of slogans was used. This evidence is far too thin to establish any reputation of any of the applicants in distinctive advertising in the Sydney market. But the respondent only advertises in Sydney and one other NSW town. It describes itself clearly by its own name and always claims to be "Sydney's Leading Audio-Video Specialists". It seems that the applicants are keen to break into the Sydney market, but have not yet done so. What has happened is that the respondent has taken some ideas from the applicants' advertising in other places, and used them in Sydney before the applicants have had a chance to do so. This does not appear to be actionable unless the public has been deceived or misled by it. The class of persons who could be misled would appear to be strictly limited. It must be confined to those persons who are sufficiently interested in the applicants' advertisements in Melbourne or elsewhere to recognize their distinctive features and identify them with the applicants. They would also have to be interested in purchasing the goods concerned on the Sydney market, but not sufficiently familiar with the industry to know that there is in fact no connection between the applicants and the respondent. Having thus considered the available evidence as to whether the respondent's conduct has been misleading in nature and whether the public was likely to be misled in fact, I have reached the conclusion that there is here a serious question to be tried, even though I do not regard the applicants' case as strong. Whether it succeeds or not will probably depend on evidence which is not yet before the Court. On the question of balance of convenience, I find the scales lightly but evenly balanced. It would not be very difficult for the respondent to recast its advertisements - given a reasonable time to do so - and the cost of such recasting would be readily quantifiable. On the other hand I am not persuaded that the applicants are likely to suffer any serious harm if the advertisements - which have already been running for some 7 months - were to continue until trial, which has been fixed for mid-April. With "It's gotta go" out of the way, the only matters of substance left are the grid pattern and the juxtaposition of the words "price" and "advice", although in different phrases. It is significant that the applicants delayed three months, after they knew the offending conduct would continue, before they issued proceedings. They may have been wondering whether, in view of what was at stake, expensive court proceedings were warranted. In my view, both parties in this dispute should ask themselves that question now. For the present I merely say that the applicants have failed to persuade me, in all the circumstances, that interlocutory injunctions are appropriate. However I have reached that conclusion, as a matter of discretion, ona fairly even balance. The exchange of material on affidavit has not been wasted, and for these reasons I think it is best that I should reserve the costs of this application. Other interlocutory orders have already been made, which will lead to an early hearing if a sensible commercial solution to this dispute cannot be found. I certify that this and the seven (7) preceding pages are a true and accurate copy of the Reasons for Judgment herein of The Hon Mr Justice Woodward Associate Dated: 6 March 1987 Counsel for the Applicant: Mr J. Burnside Solicitors for the Applicant: Messrs Coltmans Counsel for the Respondent: Mr S. Wilson Solicitors for the Respondent: Messrs Freehill, Hollingdale and Page