a NOT FOR DISTRIBUTION IN THE FEDERAL COURT OF AUSTRALIA ) ) WESTERN AUSTRALIA DISTRICT REGISTRY ) No. WA G 46 of 1987 ) GENERAL DIVISION ) BETWEEN : AUSTRALIAN LUMBER CO. PTY. LID. trading as W.A. Salvage Applicant AND: PETER BORELLO Respondent MINUTE OF ORDER JUDGE MAKING ORDER : Neaves Jd. DATE OF ORDER : 3 July 1987 WHERE MADE : Canberra THE COURT ORDERS THAT: 1. The motion for interlocutory relief be dismissed. 2. The applicant pay the respondent's costs of the motion. Note: Settlement and entry of orders is dealt with in Order26 >. of the Federal Court Rules. S IN THE FEDERAL COURT OF AUSTRALIA WESTERN AUSTRALIA DISTRICT REGISTRY No. WA G 46 of 1987 ewer rvnr GENERAL DIVISION BETWEEN : AUSTRALIAN LUMBER CO. PTY. LTD. trading as W.A. Salvage Applicant AND: PETER BORELLO Respondent CORAM Neaves J. DATE: 3 July 1987 REASONS FOR JUDGMENT Australian Lumber Co. Pty. Ltd. ("the applicant") has applied to the Court by motion for an interlocutory injunction pending the hearing of the substantive application referred to below restraining Peter Borello ("the respondent") from - "(a) Causing or procuring the broadcasting or dissemination on television in Perth of advertisements depicting the character 'Luigi Sava Da Money' as shown in Annexure 'A' to the Affidavit of Joseph Boros dated 21 April 1987 or a colourable imitation thereof in breach of the provisions of Sections 52 and 53(d) read with Section 6(3)(a) and (b) of the Trade Practices Act 1974 (Commonwealth) ; (b) Committing any other acts of misleading or deceptive conduct or acts amounting to 'passing off' whereby the public or members of the public are induced or led to believe that there 1s any connection between the business of the Applicant conducted at its various branches in 2. Perth and that of the Respondent conducted by the Respondent under the name of 'Buccaneer Pools and Patios' at Belmont by reason of the use by the Respondent of the character 'Luigi Sava Da Money' or a colourable imitation thereof in television advertisements; (c) Committing any acts of infringement of the Applicant's copyright in the picture of the character 'Luigi' as depicted in Annexure 'A' aforesaid in breach of the provisions of the Copyright Act 1968 (Commonwealth)". The substantive application filed on behalf of the applicant seeks a permanent injunction in similar terms as well as damages and costs. As the respondent is not a corporation, the applicant relies on the extended operation given to Division 1 of Part V, which includes ss.52 and 53(d), of the Trade Practices Act 1974 (Cth) ("the Trade Practices Act") by s.6(3) thereof. The latter sub-section provides, so far as relevant: "(3) In addition to the effect that this Act, other than Part X, has as provided by sub-section (2), Division 1 of Part V has, by force of this sub-section, the effect at would have 1f - (a) that Division (other than section 55) were, by express provision, confined in 1ts operation to engaging in conduct to the extent to which the conduct involves the use of postal, telegraphic or telephonic services or takes place ina radio or television broadcast; (bd) .... (c) ....a reference in that Division toa corporation included a reference to a person not being a corporation." In support of the motion for an interlocutory injunction the applicant relies on the three several affidavits of Joseph Boros, the managing director of the applicant, sworn on 21 April 1987, 7 May 1987 and 19 May 1987 respectively, the affidavit of David Cornelius Johns sworn on 13 April 1987 and the affidavit of Lindsay Allan Cary sworn on 21 April 1987. In opposition to the motion the respondent relies upon his own affidavit sworn on 13 May 1987, the affidavit of Diana Denise Newman sworn on 8 May 1987 and the affidavit of Lee Russell Smith sworn on 14 May 1987. Certain paragraphs of Mr Boros' affidavit sworn 21 April 1987 were objected to and rejected. None of the deponents was cross-examined. For the purposes of this application, I accept that the facts are as stated in the affidavits and the annexures thereto except, of course, the Paragraphs of Mr Boros' affidavit that were not admitted into evidence. I have viewed several examples of the applicant's advertising material as broadcast on television and the advertisement used by the respondent which is the subject of this application. The respondent, who is of Italian descent, 1s the sole proprietor of a business carried on at Belmont in the State of Western Australia under the name "Buccaneer Pools". The nature of the business 1s described as the design, construction and installation of fibreglass swimming pools. 4. Seven distinctive designs are marketed. Such swimming pools sell for a base price of approximately $8,000. In addition to selling fibreglass swimming pools from its showroom at Belmont, Buccaneer Pools also sells pool accessories including chlorinators, hosing, test kits and leafscoops. These accessories are sold as a_ service to customers of Buccaneer Pools which does not conduct a service department for the public and does not have a separate retail area at its showroon. Buccaneer Pools commenced to advertise on television in 1976. From the outset the respondent wrote the scripts for the advertisements and personally appeared in them. He also used the services of a presenter, Mr J.K. Watts, whose task was to present the bulk of the script of each advertisement. In late 1986 the respondent caused to be made the advertisement of which the applicant complains. The advertisement 1s for what is described as a do-it-yourself turbo tub swimming pool. It opens with an overall view of the factory yard containing a number of fibreglass swimming pool shells and two vehicles bearing the name "Buccaneer". Standing in the swimming pool shell nearest the camera is the presenter of the advertisement, Mr Watts, dressed in a suit. Standing beside him is the respondent dressed in a dark blue singlet and pale blue trousers with a knotted white handkerchief on his head. He wears a chain around his neck with a large medallion at the front. Mr Watts then 5. advertises the pool kit consisting of the pool shell, a filter and pump at the price of $4,000 emphasising that the offer is only open at Buccaneer Pools. He introduces "my mate Peter Borello" as the person who will show a purchaser how easy it is to assemble the various components. Mr Borello emphasises how easy that task 1s, leaning forward towards the camera as he does so as if to emphasise his words. His comments are followed by laughter presumably not at the content of what he says but at his manner of delivery. The scene then moves into the showroom of the factory and features an installed turbo-tub swimming pool filled with water which is being agitated. At the rear of the pool Mr Watts and the respondent are standing. Mr Watts again advertises the product following which the respondent gestures and uses the words "Come to Belmont and sava da money". His performance is again followed by laughter - in fact somewhat prolonged laughter. The name Buccaneer Pools is prominently displayed during the advertisement. The name "Luigi" is not mentioned. The respondent has described the words spoken by hin in the advertisement as Australian/Italian slang. The applicant is one of a group of companies generally known as the Alco Group. It carries on business under the name "W.A. Salvage" at Leederville, Balcarra, Cannington, Midland and Spearwood, all within the metropolitan area of Perth. It sells a great variety of goods. It has an annual turnover of approximately $10m. . 6. The general nature of its business appears from the following extract from a brochure, being an annexure to Mr Boros' affidavit sworn 21 April 1987, put out by the applicant: "W.A. Salvage operates from five warehouse style stores in the Perth metropolitan area, catering for the price conscious home owners and the bottom end of the do-it-yourself market. Their basic range of merchandise is timber and building materials drawn from new downgraded and manufacturers surplus" stock. They have an extensive range of secondhand goods which are taken from their demolition sites. W.A. Salvage also sells a wide range of general merchandise which includes paint, giftware, toys, footware and camping gear, which are obtained at Auctions or imported from interstate or overseas. W.A. Salvage are equipped to purchase and efficiently retail any products which can be obtained in volume and lend themselves to self service warehouse retailing." The diversity of products sold is well illustrated by the newspaper advertisements in evidence. They include dressed timber, chipboard, roof and wall sheets, fertiliser, paint, barbecues, combination locks, cake pans, Christmas tree lights, children's swings, ceramic ornaments, baseball sets and shadecloth. The emphasis is clearly on cheap prices. Some of the goods sold are referred toas "opportunity lines", an expression explained to mean goods which it is able to purchase cheaply and sell at what would be a discounted value relative to other retail outlets. It is clear on the evidence that the respondent carries on an entirely different kind of business from that 7. Ce eae ain nite cin in etna sie ee ed carried on by the applicant. There is at the present time no overlap in their respective fields of business activity and there is nothing in the evidence to suggest that this will change in the foreseeable future. There is, in fact, no association or connection between the two businesses. Mr Boros states in his affidavit that the applicant has a wide and well known reputation throughout' the metropolitan area of Perth. He does not elaborate upon the nature of that reputation, the reader being left to draw his own conclusions from the information provided as to the type of business in fact carried on. Notwithstanding the paucity of material, I am prepared to accept, for the purpose of considering the present application, that the applicant has a significant local reputation in respect of the business which it carries on. Mr Boros says that the applicant in or about 1976 desired to improve the format of its advertising by making use of an emblem or character which would depict the nature of the business and also identify the market aimed at. At that time, he says, the market aimed at was mainly the "price conscious lower end of the building materials Market". An advertising agency was commissioned to prepare an appropriate character or emblem. Mr Boros says that, in consequence of their efforts, the applicant adopted a character called "Luigi Sava-da-Money". What was submitted by the advertising agency was, in fact, a photograph of the upper part of the body of an actor dressed ina singlet and with his hair covered by a knotted handkerchief. He has a very prominent moustache. The photograph shows the right arm bent at the elbow so that the actor's hand is at the same level as his mouth with his fingers, other than his index finger, extended upwards. The index finger is bent downwards to touch the thumb and so depict a circle. Across the left upper part of the singlet are the words, in script, "Luigi Sava-da-Money". Mr Boros says that the character has since 1976 been used extensively by the applicant in the conduct of its business. He further states that, by agreement between the applicant and the advertising agency, copyright "in the picture of the character" vested in the applicant. Three examples of the applicant's advertisements as appearing in Perth newspapers are in evidence. Two of them contain a reproduction of the photograph much reduced in size. Two of them, including one in which the reproduction of the photograph appears, contain line drawings evidently intended to represent "Luigi". A reproduction of the Photograph is also used as a trade mark on some goods sold by the applicant. "Luigi" is also depicted on wall and other signs on the various business premises of the applicant. In television advertising, which is broadcast on Channels 7 and 9 in Perth on a regular basis, "Luigi" is depicted by an actor, apparently the actor who posed for the photograph already mentioned. He has a swarthy appearance. 9. He is dressed in a singlet, shorts, socks and boots and has his hair covered by a knotted handkerchief. The colour of his clothes is predominently dark blue though the shade of blue varies from advertisement to advertisement. Sometimes the handkerchief is white, sometimes blue. On occasions it is replaced by other headgear. Sometimes the singlet bears advertising material on both front and back. Each advertisement advertises a particular product or particular products with prominence being given to the applicant's business name. Repetition is a feature of the advertisements, "Luigi" being depicted as a character constantly on the move, speaking almost incessantly, usually in a raised voice, and emphasising what he says by extensive use of hand and arm movements. His speech is apparently intended to convey the Australian idiom with an Italian accent and flavour. He repeats over and over again the message that the goods sold by the applicant are very cheap, the words mainly used being "We're not fancy .... but we're cheap". The slogan "Luigi Sava-da-Money"" is not a dominant feature of the advertisements viewed by the Court. Ina number of those advertisements, however, "Luigi" introduces himself as "Luigi from W.A. Salvage" and exhorts his audience to "Cuma to W.A. Salvage where you sava-da-money". In the various forms of advertising the character is used both with and without the name "Luigi" and with and without the words "Sava-da-Money". It is asserted that the character "has become an integral part of the get-up and image of the business of W.A. Salvage and is very well known . 10. as part of the business and as depicting and representing the business and its goods in Perth due to the long and extensive use thereof" in the manner shortly referred to above. It is said that in the past ten years a total of approximately $1.6m has been expended by the applicant on advertising, most of that advertising incorporating the "Luigi" character. Mr Boros asserts that the applicant's customers include builders, tradesmen and others involved in the building industry as well as the general public including handymen and "do-it-yourself" householders. He expresses the belief that many of the respondent's customers would also be customers of the applicant. The applicant alleges that it has suffered damage arising from the conduct of the respondent but the evidence does not make clear what is the nature of that damage. It is stated that particulars of damage will be provided prior to the trial of the proceeding. The applicant has not seen fit to place before the Court onthe hearing of the application for interlocutory relief any evidence as to the damage it is alleged to be suffering as a result of the continued use by the respondent of the advertisement the subject of the complaint. The application for interlocutory relief is supported by grounds based on ss.52 and 53({d) read with s.6(3) of the Trade Practices Act. No argument was put to , ll. the Court based on the allegation of passing off or the allegation of breach of copyright. The application is opposed by the respondent. The applicant submits that the evidence discloses a deliberate attempt by the respondent to seek to appropriate to his swimming pool business the applicant's good business reputation. It is said that he has done this by the adoption and use of a style of television advertising which copies both the character "Luigi" developed by the applicant to promote its business and used by it on a regular basis over many years in such promotion and also the form of words "Sava-da-Money"" employed by the applicant in its advertisements. By the use of the advertisement in question the respondent is said to be engaging in conduct that is misleading or deceptive or is likely to mislead or deceive, and therefore in contravention of s.52 of the Trade Practices Act read with s.6(3) thereof, because it misrepresents to a relevant and identifiable section of the public either - (a) that the respondent's swimming pool business is the same business as that conducted by the applicant; {b) that there is a connection or association between the two businesses; or (c) that the applicant has given its imprimatur, endorsement or stamp of approval to the fibreglass swimming pools being marketed by the respondent. 12. It is further submitted that the advertisement, contrary to s.53(d) of the Trade Practices Act read with s.6(3) thereof, represents that the respondent has a sponsorship, approval or affilitation with the applicant, a sponsorship, approval or affiliation which he does not, in fact, have. The case for the applicant turns solely on the question whether the television advertisement would convey to reasonable members of the television viewing audience to which it 1s directed any of the representations upon which the applicant relies. In accordance with authority, two issues arise. Has the applicant demonstrated that there is a serious question to be tried in that regard and, if so, does the balance of convenience require that an injunction be granted? The advertisement the subject of the applicant's complaint is of short duration - of the order of thirty seconds. I have already referred to its main features. To those features one should add that the respondent and the actor portraying "Luigi" are of similar build and complexion. The respondent has a moustache but it is by no means as prominent as that worn by the actor. Further, the respondent takes a subsidiary role in the advertisement - he is not the dominant character as "Luigi" is in the applicant's advertisements. The viewer of the respondent's advertisement would have but little opportunity to perceive and take note of , 13. much of the detail visually presented. In particular, I would not expect the ordinary reasonable viewer, even if familiar with the portrayal in the applicant's advertisements of "Luigi", to perceive such differences as there may be between the bodily features and dress of the respondent in his advertisement and the actor playing "Luigi" in the applicant's advertisements. It is, I think, fair to say that the ordinary reasonable viewer would be left with the impression that there is a resemblance, even perhaps a striking resemblance, between the respondent as attired for his advertisement and the get-up of the actor Playing the part of "Luigi". He would also perceive a certain similarity in the kind of language and the style of speech used by the respondent in his advertisement and that of "Luigi" in the applicant's advertisements. But it would not, in my opinion, go beyond that. The ordinary reasonable viewer would not believe that "Luigi" was appearing in the respondent's advertisement. He would, I think, regard the respondent's appearance and speech as an imitation, more or less believable, of "Luigi" but none the less an imitation. It is of some significance, in this connection, to note what is said by Mr Johns and Mr Cary in their affidavits filed on behalf of the applicant. Mr Johns states that the respondent's advertisement "depicts a character which .... is a clear and obvious imitation of the 'Luigi' character as used by the applicant". Mr Cary's affidavit is to the same effect. But so to conclude is not to establish that the advertisement would convey to the ordinary reasonable viewer any of the representations on which the applicant relies or 14. provide a sufficient ground upon which to grant an interlocutory injunction. A reasonable viewer of the respondent's advertisement who is familiar with the applicant's advertisements may well wonder whether it is, in fact, "Luigi" who is taking part in the advertisement for the respondent and why he would be doing so. That viewer may even experience some confusion over the matter. But, again, even if that be so, i1t 1s not sufficient to entitle the applicant to the relief it seeks. What the advertisement complained of would portray to the ordinary reasonable viewer is a matter of impression. I have viewed the advertisement a number of times. I am not persuaded that there is an issue of a sufficiently substantial kind that the ordinary reasonable viewer would think that the advertisement represents that the respondent's business is the same business as that conducted by the applicant or that it has any connection or association with the applicant or that the applicant has given its imprimatur, endorsement or stamp of approval to the product being marketed by the respondent. In my opinion, objectively viewed, the advertisement does not, in fact, make any of the statements attributed to it by the applicant. Being of opinion that there is no substantial issue to be tried, I need not consider the balance of convenience. , 15. For the reasons set out above, the motion for interlocutory relief is dismissed. The applicant must pay the respondent's costs of the motion. I certify that this and the preceding 14 pages are a true copy of the Reasons for Judgment herein of the Honourable Mr Justice Neaves. Video Browwry Associate Dated: 3 July 1987 Counsel for the applicant : Mr T.E. 0'Connor Solicitors for the applicant Mallesons Stephen Jaques Counsel for the respondent : Mr P.A. Tribe and Mr E.W. Nielsen Solicitors for the respondent E.W. Nielsen & Co. Date of hearing : 29 May 1987