Telstra Corporation Ltd v. Communications Network International Inc. & Anor [1994] FCA 1000

JUDGMENT No. LO. 2O7 24,

IN _ THE FEDERAI, COURT OF AUSTRALIA ) )

VICTORIA DISTRICT REGISTRY ) No.VG 301 of 1994 ) )

GENERAL DIVISTON

BETWEEN:

TELSTRA CORPORATION LIMITED (ACN 051 775 556) Applicant - and -

COMMUNICATIONS NETWORK INTERNATIONAL INCORPORATED First Respondent - and -

DATATEL INTERNATIONAL PTY LTD (ACN 008 208 688) Second Respondent

JUDGE : Heerey J DATE: 2 December 1994 PLACE: Melbourne EX TEMPORE REASONS FOR JUDGMENT The applicant seeks leave to withdraw this proceeding under 0 I

22 r 2(1)(d). The question at issue is whether that order should be made on terms that the second respondent pay the applicant's costs. It is accepted that I have a general discretion under s 43 of the Federal Court Act 1976 (Cth) to

award costs.

The proceeding was brought by the applicant, who carries on business under the name "Telecom", against the first respondent, an American corporation which manufactures a telephone credit card under the name "The Telecom Pay Card". The second respondent is the Australian agent and distributor of the first respondent. The proceeding was commenced on

13 September 1994. An application for an interlocutory

2.

injunction was heard by Olney J on 27 September. On 30 September his Honour granted the injunction sought. His Honour (at 4) made some observations about the appearance of

the respondents' card:

"The general get up of the card and brochure is in my opinion likely to mislead or deceive all but the most astute and inquiring minds into believing that The Telecom Pay Card 16 a product of the applicant and particularly the use of the definite article before the word 'Telecom' is strongly suggestive of the fact that Telecom in that context 1s used to distinguish the card as one associated with the applicant's business."

His Honour gave directions which would have resulted in a fairly early trial of the matter. Negotiations took place between the applicant and the first respondent which resulted in a satisfactory resolution of the matter on the basis that the first respondent would not seek to have the card sold in Australia and that each party would bear its own costs. The President of the first respondent said in a letter to the