CATCHWORDS Trade Practice - misleading and deceptive conduct - reputation and goodwill in the name "Miki House" —- relevant geographical area for reputation and goodwill. Trade Practices Act 1974 ss.52, 53. MIKI SHOKO CO. LIMITED and DAVID JONES (AUSTRALIA) PTY. LIMITED AND MERV BROWN PTY. LIMITED MERV BROWN PTY. LIMITED AND MIKI SHOKO CO. LIMITED and DAVID JONES (AUSTRALIA) PTY. LIMITED No VG221 of 1985 MIKI SHOKO CO. LIMITED and DAVID JONES (AUSTRALIA) PTY. LIMITED AND MERV BROWN PTY. LIMITED No NG276 of 1985 Sweeney, Lockhart and Spender JJ. Melbourne 18 December, 1987 IN THE FEDERAL COURT OF AUSTRALIA VICTORIA DISTRICT REGISTRY GENERAL DIVISION JUDGES MAKING ORDER: DATE OF ORDER: WHERE ORDER MADE: THE COURT ORDERS THAT: (Australia) Pty. Leave be granted to Miki Shoko Co. No. VG 221 of 1985 ON APPEAL FROM A SINGLE JUDGE OF THE FEDERAL COURT OF AUSTRALIA- BETWEEN: MIKI SHOKO CO LIMITED and DAVID JONES (AUSTRALIA) PTY. LIMITED Appellants AND: MERV BROWN PTY. LIMITED Respondent AND: MERV_ BROWN PTY. LIMITED Cross Appellant AND: MIKI SHOKO CO LIMITED and DAVID JONES (AUSTRALIA) PTY. LTD. Cross Respondents SWEENEY, LOCKHART and SPENDER JJ. 18 DECEMBER 1987 MELBOURNE MINUTE OF ORDERS Limited and David Jones Limited to appeal to a Full Court of this Court from the judgment of Northrop J. given on 22 May 1987. The draft notice of appeal filed by Miki Shoko Co. Limited and David Jones (Australia) Pty. Limited on 18 August 1987 be deemed to be the notice of appeal. 3. Leave be granted to Merv Brown Pty. Limited to cross-appeal from the said judgment of Northrop J. 4. The draft notice of cross appeal being exhibit "JMG-1" to the affidavit of Joy Michelle Geary sworn on 16 September 1987 and filed herein be deemed to be the notice of cross appeal. 5. Further compliance with the Rules of the Pederal Court as to filing and serving the notice of appeal and the notice of cross appeal be dispensed with save that the usual filing fees shall be paid. 6. The appeal be allowed for the purpose of substituting the following order for order 1. made by Northrop J. on 22 May 1987:- "i. That the respondents and each of them by themselves, their directors, officers, servants and agents or otherwise howsoever be restrained:- (a) from engaging in conduct that is misleading or deceptive or is likely to mislead or deceive by importing or causing to be imported into Australia or manufacturing or causing to be manufactured or keeping for sale, advertising or offering for sale, supplying, distributing or selling any articles of clothing or any other goods whatsoever under or by reference to the trade mark 'Miki House' or under or by reference to any name, word or mark substantially identical or deceptively or misleadingly similar thereto; 3. (b) from falsely representing in the course of trade or commerce in connexion with the supply or possible supply or in connexion with the promotion by any means of the supply or use of any articles of clothing or any other goods that such goods are of a standard or quality as the articles of clothing or other goods of the applicant referred to ina- (a) hereof by using in respect of articles of clothing or any other goods the trade mark 'Miki House' or any other name, word or mark substantially identical or deceptively or misleadingly similar thereto; (c) from representing 1n the course of trade or commerce in connexion with the supply or possible supply or in connexion with the promotion by any means of the supply or use of any articles of clothing or other goods:~ (i) that any such goods, not of the manufacture of or sold or approved by the applicant, have the sponsorship or approval of the applicant; (ii) that the respondents or any business of the respondents or either of them has the sponsorship or approval of the applicant or is affiliated with the applicant; by using in respect of articles of clothing or any other goods the trade mark 'Miki House' or any other name, word or mark substantially identical or deceptively or misleadingly similar thereto." 7. The appeal otherwise be dismissed. 8. Miki Shoko Co. Limited and David Jones (Australia) Pty. Limited pay the costs of Merv Brown Pty. Limited of the appeal including reserved costs. 9. There be no orders in the cross appeal. NOTE: SETTLEMENT AND ENTRY OF ORDERS IS DEALT WITH IN ORDER 36 OF THE FEDERAL COURT RULES. IN THE FEDERAL COURT OF AUSTRALIA ) ) NEW SOUTH WALES DISTRICT REGISTRY ) No. NG 276 of 1985 ) GENERAL DIVISION ) ON APPEAL FROM A SINGLE JUDGE OF THE FEDERAL COURT OF AUSTRALIA BETWEEN: MIKI SHOKO CO LIMITED and DAVID JONES (AUSTRALIA) PTY. LIMITED Appellants AND: MERV_ BROWN PTY. LIMITED Respondent JUDGES MAKING ORDER: SWEENEY, LOCKHART and SPENDER JJ. DATE OF ORDER: 18 DECEMBER 1987 WHERE ORDER MADE: MELBOURNE MINUTE OF ORDERS THE COURT ORDERS THAT: 1. Leave be granted to Miki Shoko Co. Limited and David Jones (Australia) Pty. Limited to file and serve a notice of appeal to a Full Court of the Federal Court from the judgment of Northrop J. given on 22 May 1987 notwithstanding that the time for filing and serving the same has expired. 2. The draft notice of appeal, a copy of which is annexure "A" to the affidavit of John Grant Fuller sworn 14 August 1987 and filed herein be deemed to be the notice of appeal. NOTE: 2. Further compliance with the Rules of the Federal Court as to filing and serving the notice of appeal be dispensed with save that the usual filing fees shall be paid. The appeal be dismissed. Miki Shoko Co. Limited and David Jones (Australia) Pty. Limited pay the costs of Merv Brown Pty. Limited of the appeal including reserved costs. SETTLEMENT AND ENTRY OF ORDERS IS DEALT WITH IN ORDER 36 OF THE FEDERAL COURT RULES. IN THE FEDERAL COURT OF AUSTRALIA ) ) VICTORIA DISTRICT REGISTRY ) No. VG 221 of 1985 ) ) GENERAL DIVISION ON APPEAL FROM A JUDGE OF THE FEDERAL COURT OF AUSTRALIA BETWEEN: MIKI SHOKO CO. LIMITED and DAVID JONES (AUSTRALIA) PTY. LIMITED Appellants AND : MERV BROWN PTY. LIMITED Respondent AND : MERV BROWN PTY. LIMITED Cross Appellant AND : MIKI SHOKO CO. LIMITED and DAVID JONES (AUSTRALIA) PTY. LIMITED Cross Respondents IN THE FEDERAL COURT OF AUSTRALIA NEW SOUTH WALES DISTRICT REGISTRY No. NG 276 of 1985 GENERAL DIVISION ON APPEAL FROM A JUDGE OF THE FEDERAL COURT OF AUSTRALIA BETWEEN: MIKI SHOKO CO. LIMITED and DAVID JONES (AUSTRALIA) PTY. LIMITED Appellants AND : MERV BROWN PTY. LIMITED Respondent THE COURT: Sweeney, Lockhart & Spender JJ. PLACE Melbourne DATE 18 December, 1987 [th REASONS FOR JUDGMENT Sweeney J. I agree with the orders proposed by Lockhart J. and with his reasons. ~ I certify that this and the preceding page is a true copy of the Reasons for Judgment herein of the Honourable Mr. Justice Sweeney Dated: 18 Ee. Associate IN THE FEDERAL COURT OF AUSTRALIA VICTORIA DISTRICT REGISTRY eee ww GENERAL DIVISION No. VG 221 of 1985 ON APPEAL FROM A SINGLE JUDGE OF THE FEDERAL COURT OF AUSTRALIA BETWEEN: MIKI SHOKO CO LIMITED and DAVID [2 z Uv AND: AND: IN THE FEDERAL COURT OF AUSTRALIA ) ) NEW SOUTH WALES DISTRICT REGISTRY ) ) GENERAL DIVISION ) JONES (AUSTRALIA) PTY. LIMITED Appellants MERV_ BROWN PTY. LIMITED Respondent MERV_ BROWN PTY. LIMITED Cross Appellant MIKI SHOKO CO LIMITED and DAVID JONES (AUSTRALIA) PTY. LTD. Cross Respondents No. NG 276 of 1985 ON APPEAL FROM A SINGLE JUDGE OF THE FEDERAL COURT OF AUSTRALIA BETWEEN: lz Zz iv] MIKI SHOKO CO LIMITED and DAVID JONES (AUSTRALIA) PTY. LIMITED Appellants MERV_ BROWN PTY. LIMITED Respondent COURT: SWEENEY, LOCKHART and SPENDER JJ. DATE: 18 DECEMBER 1987 fe roe 2. f REASONS FOR JUDGMENT LOCKHART J. The question in this case is whether Miki Shoko Co. Limited ("Miki Shoko") or Merv Brown Pty. Limited ("Merv Brown") has-the right to use the name "Miki House" in Australia with respect to children's clothing. On 20 September 1985 Miki Shoko and David Jones (Australia) Pty. Limited ("David Jones") commenced proceedings in this Court's New South Wales District Registry (No. G 276 of 1985) ("the New South Wales proceedings") to restrain Merv Brown from selling or advertising children's clothing bearing the words "Miki House". Miki Shoko and David Jones asserted that Miko Shoko had acquired a substantial and valuable reputation or goodwill in the name "Miki House" associated with children's clothing and that Merv Brown, by selling children's clothing with the name "Miki House", engaged in misleading or deceptive conduct under s. 52 of the Trade Practices Act 1974 ("the Trade Practices Act"). It was claimed in the alternative that, by using "Miki House", Merv Brown had represented that its children's clothing had sponsorship or approval which it did not have within the meaning of s. 53(c) of the Trade Practices Act. On 23 September 1985 Merv Brown commenced proceedings in the victorian Registry of this Court (VG 221 of 1985) ("the Victorian proceedings") against Miki Shoko and David Jones asserting that it is the proprietor in Australia of the trade mark "Miki House"; that Miki Shoko or David Jones is using that mark in respect of articles of children's clothing and that their conduct contravenes ss. 52, 53(c), 3. e 53(d), 55 and 55A of the Trade Practices Act, passing off by them of their goods as the goods of Merv Brown and that the use of the mark constitutes an infringement of Merv Brown's rights to the registered mark. Miki Shoko and David Jones cross-claimed in the Victorian proceedings seeking a declaration that a form of assignment, by which Merv Brown became registered as the proprietor of the mark "Miki House" in respect of articles of clothing, did not validly assign that mark to Merv Brown pursuant to the Trade Marks Act 1955, On 28 October 1985 Northrop J. granted interlocutory 1ajunctions restraining Miki Shoko and David Jones from advertising or offering for sale or selling within Australia articles of clothing by reference to the mark "Miki House", but refused to grant interlocutory injunctions restraining Merv Brown from advertising or offering for sale or selling articles of clothing by reference to that mark. His Honour's reasons for judgment are reported in [1986] 10 F.C.R. 459. Northrop J. was the trial Judge and on 22 May 1987 he gave judgment following the final hearing of the two sets of proceedings. H1s Honour granted injunctions restraining Miki Shoko and David Jones in essence from importing, manufacturing, selling or advertising for sale any clothing by reference to the trade mark "Miki House" and from passing off their goods as the goods of Merv Brown by using that mark. His Honour dismissed the cross-claim of Miki House and David Jones brought in the Victorian proceedings, ordered Miki Shoko and David Jones to pay the costs of Merv Brown in both proceedings and adjourned the proceedings for the purpose of dealing later with any question of damages that might have been sustained by Merv Brown. His Honour dismissed with costs the New South Wales proceedings. The Facts This case turns essentially on its facts which are set out fully in the reasons for judgment of Northrop J. following the final hearing and in his Honour's earlier reasons given on the motion for interlocutory relief. I shall mention only those facts essential to the appeal. The facts are not seriously in dispute. Miki Shoko, incorporated under the laws of Japan in late 1978, manufactures and sells childrens' clothing and accessories. This is done under the mark "Miki House" invented by it and registered in Japan in late 1982. Since that time Miki Shoko has registered the mark "Miki House" in several countries. It lodged its application for registration in Australia on 14 July 1983. Until 1982 the Miki House range of clothing, principally for children, was sold only in Japan. It became popular there and was associated with the mark "Miki House". Indeed, Mik1 Shoko has never sold the "Miki House" range of goods directly to the Australian public. The goods had been advertised in certain Japanese magazines which had come to Australia, but were read by a limited number of people. What goods actually came to Australia were used mainly by the Japanese community, having been purchased in Japan. Mr. Richard Harbig, the controller of P & M Harbig & Co. Pty. Limited (Harbig & Co) and other related companies, had seen items of the Miki Shoko clothing bearing the "Miki House" mark in the U.S. in early 1980. The Harbig group carries on a number of activities 5. r including the importation of clothing. Mr. Harbig considered the mark "Miki House" of advantage for his company's business in Australia. [In early 1982 Mr. Harbig applied for and obtained registration of the trade mark "Miki House" under Part B of the Australian Register of Trade Marks, the clothing being included in Class 25. A certificate of registration was issued on 3 August 1982. By deed of assignment dated 19 August 1980 the trade mark was transferred with goodwill to P & M Harbig (Holdings) Pty. Limited ("Harbig Holdings"), another company controlled by Mr. Harbig. The transfer was registered on 11 August 1982. Whilst Harbig (Holdings) stood as the registered proprietor in 1982 it took no action concerning the mark until 1985. From October 1983 onwards David Jones' buyers, whilst in Japan, had shown interest in the Miki Shoko clothing and accessories sold under the "Miki House" mark. These buyers sought but failed to obtain an agreement with Miki Shoko for the exclusive right to sell the goods in Australia under the "Miki House" mark. Miki Shoko refused to sell on the ground it was still developing its domestic market and was thus not prepared to export its product. In 1984, however, David Jones' buyers visiting Japan placed orders with Miki Shoko for the purchase of childrens' clothing and accessories under the "Miki House" mark. These goods arrived in Australia on 26 June 1985 after the first consignment was trans-shipped on 29 May 1985. On 20 August 1985, David Jones commenced selling the Miki Shoko merchandise under the mark "Miki House". On 10 September 1985 the Children's Vogue was published in Australia. It contained a two 6. . page advertisement for Miki House goods. It depicted a number of photographs of children in "Miki House" clothing. It emphasised the mark "Miki House". It contained the following text:- "Exclusive to David Jones. Miki House, Japan's leading designer for,.children. Fashions & fashion acessories for lucky boys and girls from 1-6. Available at Elizabeth St., Sydney & Bourke St. Melbourne only. There's no other store like DAVID JONES." In March 1984, whilst David Jones had sought and purchased the Miki Shoko goods, a subsidiary of the Merv Brown group, Update Imports Pty. Limited, through its sales manager, Mr. Daryl Beitzel, had also shown an interest in these goods. During a visit to Japan he had seen these goods, under the "Miki House" mark, being sold in department stores. Mr. Beitzel returned to Australia with both photographs and items of the clothing. He then enquired as to the mark "Miki House" in Australia and found Harbig Holdings to be the registered proprietor of that mark. In November 1984, Mr. Mervyn Brown heard that dHarbig Holdings was closing down most of its business including its import quotas for clothing. Discussions took place between Mr. Brown and officers of the Harbig group of companies concerning the purchase by the Merv Brown group of the assets of the Harbig group of companies including its registered trade marks. The various trade marks, some 25 in all, were to be assigned to various members of the Merv Brown group of companies. The total price to be paid for the trade marks was $22,000. The mark "Miki House" was to be transferred to Merv Brown and $2,000 was apportioned to that mark. The purchase price was paid at the end of May 1985. By deed of assignment dated 4 March 1985 7. e Harbig Holdings, in consideration of the sum of $5,000, assigned to Merv Brown all its interest in three trade marks including the mark "Miki House" without the goodwill of the business concerned in the goods with respect to which the said trade marks were registered. That transfer was registered on 14 August 1985. In April, 1985 Mr. Garry Brown, the merchandise manager of Update Imports, went to Japan to purchase further "Miki House" merchandise to be used as samples. A marketing agent was engaged for the purpose of negotiating and licensing other persons to manufacture merchandise using the mark "Miki House" under licence from Merv Brown. The agent commenced doing that. A decision was made to sell accessories under the mark "Miki House" as well as the clothing. In June the applications for registration of the mark "Miki House" in relation to those accessories were lodged. Merv Brown began adapting its premises to be able to cope with the new development. Officers of Merv Brown began contacting Australian department stores with respect to selling the brand name and the provision of boutiques for that purpose. The promotion was made by reference to clothing purchased in Japan from Miki Shoko, to garments made up in Taiwan as samples at the request of Merv Brown, from photographs of Miki Shoko garments and from sketches prepared by Miss Julia Fawcett, a design artist employed by Update Imports to work on the "Miki House" project for Merv Brown. It was planned to manufacture most of the clothing and accessories in Australia. In addition, members of a large number of the small retail stores attended and saw the "Miki House" project being developed at the premises of Merv Brown. 8. e Early in June Mr. Beitzel met officers of Grace Bros. in Sydney and discussed the Merv Brown project. About the middle of June Mr. Beitzel, with the Managing Director of Merv Brown's marketing agent, met officers of Myer. Discussions took place concerning the whole project and the provision of boutiques in the Myer stores for the sale of the "Miki House" merchandise. The whole of the discussions were based on the mark "Miki House" with respect to children's clothing and accessories. On this basis, Myer and Grace Bros. would have a month before any other department store would be permitted to open similar boutiques. Merv Brown claimed that it was registered as the proprietor in Australia of that trade mark. Discussions took place with other department stores including Fitzgeralds in Hobart and Launceston. On 26 July 1985, Mr. Beitzel and Miss Fawcett met officers of David Jones. The events of that day are set out in the report of Northrop J.'s reasons in 10 F.C.R. 459. It was planned that sales would commence at Myer and Grace Bros. early in 1986. On 30 July 1985 Miki Shoko applied for the removal of the existing registration fo the mark "Miki House" on the ground of non-use: Trade Marks Act 1955 s. 23. In September the two proceedings in this Court commenced. Findings of the Trial Judge The trial Judge regarded 20 August 1985 as the crucial date for the purpose of deciding the proceedings, that being the date on which David Jones commenced selling the Miki Shoko merchandise under the mark "Miki House". His Honour found that: ~ by 20 August 1985 Merv Brown had acquired in Australia a reputation or goodwill in the name "Miki House" with respect to children's clothing. There had been no long user of that name in Australia, nor had there been sales of clothing here involving such an use. ~ Miki Shoko appeared to have a reputation or goodwill in Japan in the name "Miki House" with respect to clothing, but that reputation or goodwill did not prevent another person acquiring a reputation or goodwill in Australia in the name "Miki House" with respect to clothing. The fact that some persons in Australia knew of the reputation or goodwill of the name "Miki House" with respect to Miki Shoko did not of itself prevent Merv Brown from acquiring its reputation or goodwill in Australia with respect to that name. The essential feature was the existence in Australia of a trade relation with respect to articles and that name. - The offering for sale and the sale by David Jones of clothing under the mark "Miki House" on 20 August 1985 constituted misleading or deceptive conduct within s. 52 of the Trade Practices Act by David Jones and Miki Shoko. That conduct likewise constituted a breach of s. 53. The advertisement in Children's Vogue contravened ss. 52 and 53. - Miki Shoko and David Jones did not establish their claim against Merv Brown based on the Trade Practices Act. 10. e - Merv Brown established its claim based upon the tort of passing off. His Honour then turned to the questions arising under the Trade Marks Act. An issue in the case before his Honour was the validity of the registration of the trade mark "Miki House" in the name of Merv Brown. Miki Shoko and David Jones alleged that the use of the trade mark would be likely to deceive or cause confusion. [In their cross-claim in the Victorian proceedings as first amended Miki Shoko and David Jones sought an order that the trade mark be removed from the Register and an order that the Register be rectified by deleting the name of Merv Brown and inserting Miki Shoko as the registered proprietor of the mark. Both of these claims were abandoned in these proceedings, partly it appears because the Registrar of Trade Marks was not a party to them. What was finally sought in the cross-claim was a declaration that the deed of 4 March 1985 between P. & M. Harbig Holdings Pty. Ltd. as assignor and Merv Brown as assignee did not validly assign the trade mark "Miki Shoko". Proceedings are pending before the Registrar of Trade Marks relating to the "Miki House" mark separate from the pending application by Miki Shoko for registration of that mark. We were informed that those separate proceedings were for expungement of the mark from the Register primarily on the ground of non-user. Otherwise we know nothing of those proceedings. His Honour made certain findings with respect to the issues raised under the Trade Marks Act, but he said that he did so with some reluctance because of the pending proceedings before the Registrar of ll. e Trade Marks and he made it clear that any views expressed by him were not intended to restrict the functions of the Registrar. His Honour considered whether the assignment of the trade mark to Merv Brown was sufficient to make it the owner of the mark and he held that he was satisfied that the goodwill of the clothing business conducted by the Harbig group of companies passed to the Merv Brown group of companies. The two key documents upon which this finding rested were the deed of 4 March 1985 to which I have already referred and a deed of 2 October 1985, between the same parties, which recited the deed of 4 March 1985 and included the following recitals: "B. The Assignment of the trade marks was incorrectly expressed to be without' the goodwill of the business concerned in the goods with respect of which the trade marks are registered. Cc. The parties now wish to correct the Assignment in the manner hereinafter set forth." The deed provided: "NOW, THEREFORE, IN CONSIDERATION OF THE MUTUAL PROMISES, COVENANTS & CONDITIONS HEREINAFTER CONTAINED, THE PARTIES HEREBY AGREE TO AMEND THE ASSIGNMENT AS FOLLOWS: 1. The words 'without the goodwill' whereever appearing in the Assignment are hereby amended by the deletion of the word 'without' and by the substitution therefor of the word 'with' so that the words 'without the goodwill' shall now read 'with the goodwill'. 2.0 The parties hereby agree, declare & confirm that the trade marks were assigned under the Assignment together with the goodwill of the business concerned in the goods in respect of which the trade marks are registered and which relates to the trade marks. 12. e 3. The parties hereby agree, declare and confirm that it was at all material times the intention of the parties that Merv Brown should obtain all rights to the trade marks including any reputation whch may have been acquired by reason of any prior usage of and the goodwill attached thereto. 4. The parties hereby agree, declare and confirm that at the time the Assignment was- executed, they each did not understand what was meant by the use of the words 'without the goodwill' and that the goodwill in the trade marks was in fact so assigned to Merv Brown at the time of the Assignment." His Honour concluded that he was satisfied that the goodwill of the clothing business was transferred as a result of the agreements. Leave to Appeal Miki Shoko and David Jones took the view that they had no appeal as of right from the judgment of Northrop J. in either of the two proceedings, so they filed notices of motion in each proceeding seeking orders granting leave to appeal to the Full Court of this Court against his Honour's judgment. They also filed in each proceeding notices of motion for orders granting them leave to file and serve notices of appeal in the event that leave to appeal is allowed and for orders that, in the event that leave to appeal is not necessary, they be granted leave to file and serve notices of appeal instanter. Merv Brown also filed a notice of motion in the Victorian proceeding seeking leave to cross-appeal from the judgment of Northrop J. in the event that leave to appeal is granted to Miki Shoko and David Jones; alternatively, in the event that leave to appeal is refused upon the ground that leave is not necessary, then Merv Brown 13. e sought an extension of time in which to file and serve its notice of cross appeal. Merv Brown sought to cross appeal from that part of the judgment of Northrop J. whereby he declined to make a declaration that Miki Shoko and David Jones had, by reason of their conduct, infringed the rights of Merv Brown in the trade mark "Miki House" and declined to make an order restraining Miki Shoko and David Jones' from infringing the registration. We heard together the various notices of motion and appeals. Leave to appeal from interlocutory judgments, including interlocutory judgments of this Court constituted by a single Judge, shall not be brought unless the Court or a Judge gives leave to appeal (sub-s. 24(1A) of the Federal Court of Australia Act 1976). "Judgment" is defined by s. 4 aS meaning "a judgment, decree or order, whether final or interlocutory, or a sentence". In Computer Edge Pty. Limited v. Apple Computer Inc. (1984) 54 A.L.R. 767 the High Court considered whether it was necessary for leave to be obtained from the High Court to appeal from a judgment of a Full Bench of this Court ((1984) 53 A.L.R. 225) pursuant to para. 33(4)(b) of the Federal Court Act as it was in force before its amendment in 1984, That paragraph then provided, so far as is relevant for present purposes, that an appeal may be brought as of right from a final judgment of a Full Court of the Federal Court in any proceedings in which the matter in issue amounted to or was of the value of $20,000 or upwards. Sub-section 33(3) provides that, except as provided by the succeeding provisions of that section, an appeal shall not be brought from a judgment of the Full Court of the Federal Court unless the High Court gives special leave to appeal. 14, . The judgment of the Full Court in the Apple Computer Case restrained the respondents to the appeal (Computer Edge and its managing director) from infringing copyright and from certain acts relating to the importation of articles. Both of those permanent injunctions were made quia timet. It was also ordered that, if the appellants in the Federal Court (Apple Computer companies) wished to pursue claims for damages, they should file and serve on _ the respondents notice to that effect, whereupon the matter would be referred to the trial Judge for findings on the evidence as it then stood in respect of the knowledge, if any, of the first respondent (Computer Edge), including, so far as relevant, the evidence of the second respondent (the managing director of Computer Edge) of the matters mentioned in ss. 37 or 38 of the Copyright Act 1968 as amended. Finally it was ordered that the appellants before the Full Court of the Federal Court should bring in short minutes of order to give effect to its findings on the issues relating to the Trade Practices Act. Gibbs C.J., with whose reasons for judgment Murphy J. and Wilson J. agreed, in an ex tempore judgment said that the judgment of the Full Court of the Federal Court comprised two orders which viewed by themselves and apart from the rest of the judgment were final orders and one order which was plainly interlocutory. The result of the judgment as a whole was that some of the questions in issue in the case were determined and others were not. The Chief Justice posed the question for decision as being whether a judgment of that kind is a final judgment within the meaning of sub-s. 33(4) of the Federal Court Act and sub-s. 35(3) of the Judiciary Act as they stood at the 15. e material time. His Honour applied the well established test in determining whether a judgment is final, namely, whether the judgment finally determines the rights of the parties and that in applying the test the Court must have regard to the legal rather than the practical effect of the judgment. His Honour found that, because the question of whether any and what damages were payable was left undetermined at that stage, the judgment was not a final judgment. The point arose on an objection to the competency of an appeal brought in purported exercise of a right of appeal conferred by para. 33(4)(b). The Court therefore allowed the objection to competency of the appeal. In the present case the issue of damages was by consent not determined by the trial Judge at the stage at which the other issues were determined. It was agreed by all parties that the issue of damages should be the subject of a separate determination after the delivery of judgment on the principal issues. In the Victorian proceedings certain orders were final, namely, the injunctions (Orders 1 and 2), order No. 3 dismissing the cross-claim and the orders for costs (No. 4); but order No. 5 was to adjourn the proceedings sine die. This last order was doubtless made so that in due course any question of damages could be determined by the Court, thus reflecting the agreement between the parties. The judgment of the High Court in the Apple Computer Case binds this Court with the result that the judgment of Northrop J. in the Victorian proceeding is an interlocutory judgment. Because the question of whether any and what damages are payable has not been determined at this stage the judgment of Northrop J. has not determined in a legal sense all the rights of the parties that are at 16. e issue in the proceedings. Hence, the judgment is not a final judgment; it is therefore interlocutory and an appeal from it to the Full Court only lies with leave. No party opposed the granting by this Court of leave to appeal or cross-appeal or the granting of any relevant extensions of time within which to appeal in either proceeding. In the Victorian proceeding I would grant leave to Miko Shoko and David Jones to appeal to this Full Court against the judgment of Northrop J., grant leave to them to file and serve their notice of appeal, such leave to operate from 9 November 1987 when we commenced the hearing of the appeal and the various notices of motion and order that the draft notice of appeal already filed be treated as the notice of appeal. I would also grant leave to Merv Brown to cross appeal from the judgment of Northrop J. in the Victorian proceeding and grant leave to it to file and serve a notice of cross appeal, the leave to operate from 9 November 1987 and the draft notice of cross appeal to be treated as the notice of cross appeal. In the New South Wales proceedings leave to appeal is not required as the orders of Northrop J. dismissing the application with costs are final orders. As a notice of appeal was not filed by Miki Shoko and David Jones because they took the view that leave to appeal was necessary, I would grant leave to them to file and serve a notice of appeal notwithstanding that the time for filing and serving the same has expired, the draft notice of appeal already filed to be treated as the notice of appeal. 17. e Findings I turn to the issues arising under the Trade Practices Act and passing off. There are intrinsic differences between actions for passing off and actions under s. 52. The common law action for passing off is one for protection of a plaintiff's business. An action under the Trade Practices Act is concerned primarily with the public interest; and that circumstance, together with the provisions of the Trade Practices Act itself, illustrate the differences in the nature of the two types of action. The courts however have drawn on the principles of the law of passing off to some extent in deciding cases under s. 52: see Hornsby Building Information Centre v. Sydney Building Information Centre Limited (1978) 140 C.L.R. 216 per Stephen J. at 277. Counsel for Miki Shoko and David Jones submitted that it was not open on the evidence for Northrop J. to conclude that as at 20 August 1985 Merv Brown had acquired a reputation in the name "Miki House" with respect to children's clothing and that as at that date Miki Shoko had not acquired such a reputation in Australia. Counsel also challenged the finding of his Honour that the crucial date for the purpose of deciding the proceedings was 20 August 1985, i.e., when David Jones commenced selling the Miki Shoko merchandise under the name "Miki House". Counsel submitted that the relevant date was not 20 August 1985 but December 1984 when Merv Brown initiated plans to sell children's clothing in Australia under the name "Miki House". 18. . The date 20 August 1985 was selected by his Honour doubtless because it was the date of commencement of the conduct complained of by Merv Brown, the relevant date determined by the Privy Council in Cadbury-Schweppes Pty. Limited v. Pub Squash Co. Pty. Limited (1980) 32 A.L.R. 387 at 397. See also United Telecasters Sydney Limited v. Pan Hotels International Pty. Limited (1978) T.P.R.S. 304-85. These challenges to the judgment of the trial Judge are essentially to his findings of fact. The circumstances in which an appellate court will interfere in these circumstances are well known and need no restatement. Central to the case is that from 2 April 1980 P. & M. Harbig & Co. Pty. Limited was registered in Australia as proprietor of the trade mark "Miki House". In late 1985 certain companies in the Merv Brown group agreed to purchase assets from companies in the Harbig group including various trade marks one of which was the "Miki House" trade mark. Merv Brown commenced a period of what the trial Judge described as "frenzied activities" in connection with the promotion of a "Miki House" range of merchandise including notification to chain stores that Merv Brown would not negotiate further for the sale of "Miki House" brands to them, visits by officers of Merv Brown to Japan to purchase further "Miki House" merchandise to be used as samples, engaging a marketing agent for the purpose of negotiating and licensing other persons to manufacture merchandise using the mark "Miki House" under licence from Mery Brown, making a decision to sell accessories under the mark "Miki House" as well the clothing, lodging applications for registration of the mark "Miki House" in relation to those accessories, adapting the premises of Merv Brown to cope with the new development and communicating with department stores for the 19. . purpose of selling the brand name and providing boutiques for that purpose. Merv Brown asserted its claim as the proprietor in Australia of the trade mark "Miki House". This assertion was known at least by 26 July 1985 when there was a meeting between Mr. Beitzel and Miss Fawcett on behalf of the Merv Brown group of companies and officers of David Jones. At that meeting the officers of David Jones did not deny the entitlement of Merv Brown to the proprietorship of the trade mark "Miki House" in Australia when the claim of Merv Brown to it was asserted and Mr. Peachey, the National Merchandise Director, Childrens Wear of David Jones, who attended the meeting, had prior knowledge of the name "Miki House" and the fact that David Jones proposed to sell Miki Shoko goods under the name "Miki House", That lastmentioned fact was not disclosed by Mr. Peachey to the representatives of Merv Brown at the meeting. Although Miki Shoko has marketed children's clothing under the mark "Miki House" in Japan from 1978 and has since 1982 sold the range of its clothing in other countries it has never sold its Miki House range of goods directly to the public in Australia. Its advertisements in Japanese magazines, some of which came to Australia, had a very limited distribution here and some of its range of clothing purchased in Japan was brought to Australia; but again the use was limited and was restricted, as the trial Judge found, mainly to some of the Japanese community in Australia and the articles were purchased outside Australia. Indeed, as late as October 1983, when David Jones tried to agree with Miki Shoko to obtain the exclusive rights to sell its merchandise in Australia under the mark "Miki House", Miki Shoko refused to sell on the ground that it was still developing its domestic market in Japan and was not prepared to export. 20. . By 20 August 1985 Merv Brown had not commenced retail sales, but it had done a great deal of preparatory work by way of promotion and otherwise to prepare for its campaign of retail sales and had, as the trial Judge found, derived from that activity a reputation associating clothing, in particular childrens' clothing, bearing the mark "Miki House" as being its reputation. Very slight activities have been held sufficient to establish that a name has become distinctive of a person's business in a particular country: Sheraton Corporation of America v. Sheraton Motels Limited [1964] RPC 202; Poiret v. Jules Poiret Limited (1920) 37 R.P.C. 177; Volt Australia Limited v. Directories (Aust.) Pty. Limited (1985) 5 I.P.R. 140; B.M. Auto Sales Pty. Limited v. Budget Rent-A-Car System Pty. Limited (1976) 12 A.L.R. 363; and Elida Gibbs Limited v. Colgate-Palmolive Limited (1983) F.S.R. 95. The cases of Volt Australia, B.M. Auto Sales and Elida Gibbs also support the proposition that it is not necessary that Merv Brown had commenced retail sales in order to acquire the relevant reputation for the purposes of passing off and as a basis for the operation of ss. 52 and 53 of the Trade Practices Act. In my opinion there was ample evidence to support the conclusion of the trial Judge that by 20 August 1985 Merv Brown had acquired in Australia a reputation in the name "Miki House" with respect to children's clothing. I turn to the submission of counsel for Miki Shoko and David Jones that, for the purposes of the New South Wales proceedings, the 21. e relevant date to determine the claim of Miki Shoko and David Jones based on the Trade Practices Act is December 1984, i.e., when Merv Brown commenced the activities complained of in those proceedings, namely, initiating plans to sell children's clothing in Australia under the name "Miki House". It was submitted that as at December 1984 Miki Shoko had, and Merv Brown had not, established in Australia a reputation or goodwill in the name "Miki House" with respect to childrens clothing. Some persons employed by retailers in Australia knew of the mark "Miki House" used in Japan by Miki Shoko. Also, a number of Japanese nationals had bought garments labelled "Miki House" in Japan and brought them to Australia. Some, while in Australia, had read advertisements in Japanese magazines for "Miki House" brand clothing but none had purchased clothing in Australia under the mark "Miki House". His Honour said that the Japanese magazines available in this country in which "Miki House" articles were advertised did not contemplate sales or purchases in Australia of "Miki House" articles. He said that the negotiations between Miki Shoko and David Jones to some extent illustrated a basis on which both Miki Shoko and David Jones or either of them could found the establishment of a reputation or goodwill in Australia in the mark "Miki House" with respect to clothing; but that those negotiations were limited to one retailer in Australia. His Honour found also that, although buyers from David Jones visited Japan in October 1984 and placed orders with Miki Shoko for the purchase of childrens clothings and accessories under the mark "Miki House", this merchandise was not due to arrive in Australia until about mid-1985. His Honour did not specify that, for the purposes of the New South Wales proceedings, December 1984 was the 22. - relevant time to found the establishment of any reputation in Australia by Miki Shoko with respect to the name or mark "Miki House". I accept that December 1984 was the relevant time for this question to be considered in the New South Wales proceedings; but the fair reading of his Honour's reasons must, I think, lead to the conclusion that he was satisfied that Miki Shoko had not established a reputation in Australia in the name or mark "Miki House" at any relevant time. Not only are his Honour's findings inconsistent with Miki Shoko's having acquired the relevant reputation in the name "Miki Shoko" in Australia in December 1984, but the evidence is sufficient to justify the conclusion that the reputation did not exist at that time. Counsel for Miki Shoko and David Jones submitted, in the alternative, that it is not necessary to support their case under the Trade Practices Act, that Miki Shoko had established a reputation in the name "Miki House" in Australia; it would be sufficient if the name "Miki House" was well enough known in Austrlaia to at least a sufficiently large section of the public that it would be likely to mislead or deceive people into thinking that goods sold under that name were sold in association or with the approval of Miki Shoko. His Honour approached the issues under the Trade Practices Act essentially on the basis that Miki Shoko had not established any relevant reputation in Australia in the name "Miki House" with respect to garments; but in my opinion, if the lower theshold contended for by counsel for Miki Shoko and David Jones is adopted for the purpose of s. 52, the answer would be the same on the findings of fact made by his Honour; and those findings have not been shown to be in error. 23. y The trial Judge based certain of his findings upon the premise that, for Miki Shoko to succeed in its claim to have established a reputation in Australia in the name "Miki House", there must be a business in this country to which the name is attached. His Honour cited with approval the following passage from the judgment of Dillon L.J. in Anheuser-Busch Inc. v. Budejovicky Budvar (1984) 4 I.P.R. 260 at 228: "To this end the reputation in this country, however, widespread, of the plaintiffs' 'Budweiser' as the name of a very popular beer in the American market does not help the plaintiffs. That merely shows a recognition in this country of the plaintiffs' goodwill in America; it does not show a goodwill in this country attached to a business in this country." Whether it is necessary, in order to establish a reputation in Australia of a plaintiff's product or name for the purposes of passing off (or, indeed, s. 52, to the extent that the question of reputation is relevant under that section), to prove that the plaintiff has or is connected with a business in Australia to which the reputation may attach is a question which it is not necessary to decide in this case. No party challenged before us the accuracy of the premise on which the trial Judge based these findings; and its correctness appears to have been assumed at the trial. Nor was any argument advanced before us concerning this question. In my opinion his Honour correctly decided that this case turned on the question whether Merv Brown or Miki Shoko had acquired in Australia a reputation in the name "Miki House" with respect to children's clothing, both for the purposes of passing off and the Trade Practices Act. 24, The injunctions granted by Northrop J. were based on his Honour's findings in favour of Merv Brown on the issues under the Trade Practices Act and passing off. Injunction No. 1 is based on the Trade Practices Act and No. 2 on passing-off. Northrop J. said that no further injunctive relief need be given under the trade marks claim. Hence, his Honour declined to make the declaration sought by Mery Brown in the Victorian proceedings. Counsel for Merv Brown informed us that, if the injunctions granted under the Trade Practices Act and passing off stood, then he would not ask this Court to make the additional orders sought in the cross-appeal filed in the Victorian appeal. Although we propose to vary the terms of the existing injunctions in certain respects, to which I shall turn ina moment, the essence of the relief granted by Northrop J. remains unchanged. It is not necessary, therefore, to consider the arguments relating to the questions arising under the Trade Marks Act. The question arose during argument before us whether the injunctions granted by Northrop J. may need revision in one or two respects and, in the result, counsel brought in agreed short minutes of order. In my view those orders are more appropriate than the terms of the existing injunctions which closely reflect the language of the application filed by Merv Brown initiating the Victorian proceeding. In the result I would vary the injunctions granted by the trial Judge as set out in the orders which the Court proposes to make and otherwise dismiss the appeals of Miki Shoko and David Jones in both the Victorian and New South Wales proceedings. No orders need be made on the cross-appeal of Merv Brown in the Victorian proceedings. 25. As to costs, Miki Shoko and David Jones must pay the costs of Merv Brown of both appeals. order for costs in relation to its cross-appeal, order for costs on the cross-appeal. I certify that this Merv Brown did not seek any particular so I would make no the preceding twenty-four (24) pages are a true copy of judgment of the Justice Lockhart. reasons Honourable for Mr. A Associate a "VY G- Dated: 18 December 1987 IN FEDERAL COURT OF AUSTRALIA VICTORIA DISTRICT REGISTRY GENERAL DIVISION BETWEEN : IN THE FEDERAL COURT OF AUSTRALIA NEW SOUTH WALES DISTRICT REGISTRY GENERAL DIVISION BETWEEN : NO. VG 221 of 1985 ON APP FROM A SINGLE JUDGE OF THE FEDERAL COURT OF AUSTRALTA MIKI _SHOKO CO. LIMITED and DAVID JONES (AUSTRALIA) PTY. LIMITED. Appellants MERV BROWN PTY. LIMITED Respondent MERV BROWN PTY. LIMITED Cross Appellant MIKI_SHOKO CQ. LIMITED and DAVID JONES (AUSTRALIA) PTY. LTD. Cross Respondents No. NG 276 of 1985 ON APPEAL FROM A SINGLE JUDGE OF THE FEDERAL COURT OF AUSTRALIA MIKI _SHOKO CO, LIMITED and DAVID JONES (AUSTRALIA) PTY. LIMITED Appellants MERV_ BROWN PTY. LIMITED Respondent COURT: SWEENEY, LOCKHART and SPENDER JJ. PLACE: MELBOURNE DATE: 18 DECEMBER 1987 '@e me . REASONS FOR JUDGMENT SPENDER J. I agree with the reasons for judgment of Lockhart J., and with the orders he proposes. | certify that this anc the I preceding Pages& are a true copy of the reasons for judgment herein cf oe Mr Justice Spender { Wadd at 4 | iz |e Associate Dated VG 221 of 1985 NG 276 of 1985 DAVID JONES (AUSTRALIA) PTY LIMITED & MIKI SHOKO CO LIMITED Appellants MERV BROWN PTY LIMITED Respondent Counsel for the appellants: Mc J.M. Ireland Solicitors for the appellants: Gadens by their Melbourne Agents Price Brent & Macpherson Counsel for the respondent: Dr J. McL Emmerson Q.C. Mr G.S. Clarke Solicitors for the respondent: Freehill, Hollingdale & Page Dates of hearing: 9, 10 November, 1987