FEDERAL COURT OF AUSTRALIA Deckers Outdoor Corporation Inc. v Farley (No 9) [2010] FCA 1007 Citation: Deckers Outdoor Corporation Inc. v Farley (No 9) [2010] FCA 1007 Parties: DECKERS OUTDOOR CORPORATION INC. v LEAH JANE FARLEY, DUSIA PTY LTD ACN 119 500 186, LEONID MYKHALOVSKYI, HEPBOURNE PTY LTD ACN 080 453 247, VLADIMIR VAYSMAN, JOSEF VAYSMAN, POLINA VAYSMAN, MILLHOUSE PTY LTD ACN 111 765 505, DIANNE SOMMER, SANDY HAZENDONK, HGU PTY LTD ACN 121 922 754, FEDIA PTY LTD ACN 119 500 444, TASKINC PTY LTD ACN 121 919 926, OTK INTERNATIONAL PTY LTD ACN 119 498 001, GIHAN EZZAT, JOANNE STRICKLAND, VERNON CO PTY LTD ACN 123 047 138, RASTOV PTY LTD ACN 119 498 547, VICTORIA VAYSMAN, OLIVER DOEDERLEIN, MARGARIT PEDROTTI, SAMBA ENTERPRISES PTY LTD ACN 111 968 935 and SANAURIA PTY LTD ACN 123 047 110 File number: VID 1022 of 2007 Judge: TRACEY J Date of judgment: 15 September 2010 Catchwords: CONTEMPT - Court's power to punish contempt - whether disobedience of court order constitutes contempt of court - whether criminal standard of proof applies to contemnors in breach of court order - service of orders alleged contemnors – rationale of contempt to enforce court's decisions - standard of proof Cases cited: Deckers Outdoor Corporation Inc. v Farley (No 6) [2010] FCA 391, referred to Deckers Outdoor Corporation Inc. v Farley (No 7) [2010] FCA 560, referred to Deckers Outdoor Corporation Inc. v Farley (No 8) [2010] FCA 657, referred to R v Bazley (1993) 65 A Crim R 154, cited, applied R v Cumberbatch (2004) 8 VR 9, referred to R v Lowe (1984) 154 CLR 606, cited, applied R v RLP [2009] VSCA 271, cited, applied R v Van Boxtel (2005) 11 VR 258, referred to Date of hearing: 7 & 18 June and 23 August 2010 Place: Melbourne Division: GENERAL DIVISION Category: Catchwords Number of paragraphs: 49 Counsel for the Applicant: Mr E J C Heerey Solicitor for the Applicant: Middletons Counsel for the Sixth Respondent: Mr R F Edney Solicitor for the Sixth Respondent: Matthew White & Associates IN THE FEDERAL COURT OF AUSTRALIA VICTORIA DISTRICT REGISTRY GENERAL DIVISION VID 1022 of 2007 BETWEEN: DECKERS OUTDOOR CORPORATION INC. Applicant/Cross-Respondent AND: LEAH JANE FARLEY First Respondent DUSIA PTY LTD ACN 119 500 186 Second Respondent LEONID MYKHALOVSKYI Third Respondent HEPBOURNE PTY LTD ACN 080 453 247 Fourth Respondent/Second Cross-Claimant VLADIMIR VAYSMAN Fifth Respondent/First Cross-Claimant JOSEF VAYSMAN Sixth Respondent/Third Cross-Claimant POLINA VAYSMAN Seventh Respondent/Fourth Cross-Claimant MILLHOUSE PTY LTD ACN 111 765 505 Eighth Respondent DIANNE SOMMER Ninth Respondent SANDY HAZENDONK Tenth Respondent HGU PTY LTD ACN 121 922 754 Eleventh Respondent FEDIA PTY LTD ACN 119 500 444 Twelfth Respondent TASKINC PTY LTD ACN 121 919 926 Thirteenth Respondent OTK INTERNATIONAL PTY LTD ACN 119 498 001 Fourteenth Respondent GIHAN EZZAT Fifteenth Respondent JOANNE STRICKLAND Sixteenth Respondent VERNON CO PTY LTD ACN 123 047 138 Seventeenth Respondent RASTOV PTY LTD ACN 119 498 547 Eighteenth Respondent VICTORIA VAYSMAN Nineteenth Respondent OLIVER DOEDERLEIN Twentieth Respondent MARGARIT PEDROTTI Twenty-First Respondent SAMBA ENTERPRISES PTY LTD ACN 111 968 935 Twenty-Second Respondent SANAURIA PTY LTD ACN 123 047 110 Twenty-Third Respondent JUDGE: TRACEY J DATE OF ORDER: 15 september 2010 WHERE MADE: MELBOURNE THE COURT ORDERS THAT: 1. It be declared that the Sixth Respondent is guilty of contempt by reason of the matters set out in Charges 36, 37, 52, 55, 57, 61 and 67 of the Amended Statement of Charge dated 14 March 2008. 2. It be declared that the Sixth Respondent is guilty of contempt by reason of the matters set out in Charges 4, 5 and 12 of the Statement of Charge dated 10 March 2009. 3. The Sixth Respondent be imprisoned for the following periods: (a) In respect of Charge 36 – two months' imprisonment. (b) In respect of Charge 37 – nine months' imprisonment. (c) In respect of Charge 52 – one month's imprisonment. (d) In respect of Charge 55 – one month's imprisonment. (e) In respect of Charge 57 – one month's imprisonment. (f) In respect of Charge 61 – one month's imprisonment. (g) In respect of Charge 67 – one month's imprisonment. (h) In respect of Charge 4 – 18 months' imprisonment. (i) In respect of Charge 5 – six months' imprisonment. (j) In respect of Charge 12 – three months' imprisonment. each sentence to be served concurrently with each other sentence. 4. The Sixth Respondent be imprisoned for a period of 18 months with: (a) The first six months being served in any event; and (b) The balance of the sentence being suspended from execution on condition that the Sixth Respondent refrains from contravening any of the orders made herein and binding on him on 27 November 2007 and 21 January 2009 for a period of two years from the date on which the suspension takes effect. 5. A warrant issue for the committal of the Sixth Respondent to prison for a period of six months. 6. The Sixth Respondent pay the Applicant's costs of the Applicant's notices of motion dated 11 January 2008 and 10 March 2009 on a solicitor-client basis. Note:Settlement and entry of orders is dealt with in Order 36 of the Federal Court Rules. The text of entered orders can be located using Federal Law Search on the Court's website. IN THE FEDERAL COURT OF AUSTRALIA VICTORIA DISTRICT REGISTRY GENERAL DIVISION VID 1022 of 2007 BETWEEN: DECKERS OUTDOOR CORPORATION INC. Applicant AND: LEAH JANE FARLEY First Respondent DUSIA PTY LTD ACN 119 500 186 Second Respondent LEONID MYKHALOVSKYI Third Respondent HEPBOURNE PTY LTD ACN 080 453 247 Fourth Respondent/Second Cross-Claimant VLADIMIR VAYSMAN Fifth Respondent/First Cross-Claimant JOSEF VAYSMAN Sixth Respondent/Third Cross-Claimant POLINA VAYSMAN Seventh Respondent/Fourth Cross-Claimant MILLHOUSE PTY LTD ACN 111 765 505 Eighth Respondent DIANNE SOMMER Ninth Respondent SANDY HAZENDONK Tenth Respondent HGU PTY LTD ACN 121 922 754 Eleventh Respondent FEDIA PTY LTD ACN 119 500 444 Twelfth Respondent TASKINC PTY LTD ACN 121 919 926 Thirteenth Respondent OTK INTERNATIONAL PTY LTD ACN 119 498 001 Fourteenth Respondent GIHAN EZZAT Fifteenth Respondent JOANNE STRICKLAND Sixteenth Respondent VERNON CO PTY LTD ACN 123 047 138 Seventeenth Respondent RASTOV PTY LTD ACN 119 498 547 Eighteenth Respondent VICTORIA VAYSMAN Nineteenth Respondent OLIVER DOEDERLEIN Twentieth Respondent MARGARIT PEDROTTI Twenty-First Respondent SAMBA ENTERPRISES PTY LTD ACN 111 968 935 Twenty-Second Respondent SANAURIA PTY LTD ACN 123 047 110 Twenty-Third Respondent JUDGE: TRACEY J DATE: 15 september 2010 PLACE: MELBOURNE REASONS FOR JUDGMENT 1 In Deckers Outdoor Corporation Inc v Farley (No 6) [2010] FCA 391 ("Deckers (No 6)") and Deckers Outdoor Corporation Inc v Farley (No 7) [2010] FCA 560 ("Deckers (No 7)") I found 10 charges of contempt of Court proven against Mr Josef Vaysman. 2 In Deckers Outdoor Corporation Inc v Farley (No 8) [2010] FCA 657 ("Deckers (No 8)") I dealt with five other contemnors who I had found, in Deckers (No 6), to have contravened orders made by the Court. I did not deal with Mr Vaysman at that time because he had belatedly obtained legal assistance and sought an adjournment of the plea hearing. 3 On 23 August 2010 I heard submissions made on Mr Vaysman's behalf. 4 These reasons should be read in conjunction with the reasons for judgment in Deckers (No 6), Deckers (No 7) and Deckers (No 8). I have applied the same sentencing principles in dealing with Mr Vaysman as I applied to the other Respondents with whom I dealt in Deckers (No 8). THE CHARGES 5 Ten charges of contempt of Court have been found proven against Mr Josef Vaysman. The terms of those charges are recorded in Deckers (No 6) immediately above paragraphs [105], [107], [112] and [113] and in Deckers (No 7)at [5]. 6 The substance of the charges which were dealt with in Deckers (No 6)may be summarised as follows: · Charge 36 – In contravention of orders made by the Court on 27 November 2007, Mr Vaysman provided counterfeit footwear to a person at the Moorabbin factory. This occurred on 7 December 2007 and the footwear was offered for sale on the next day by that person at the Queen Victoria Market. · Charge 37 – Between 27 November 2007 and 12 December 2007 Mr Vaysman continued to manufacture counterfeit footwear at the Moorabbin factory in contravention of the orders made on 27 November 2007. · Charge 52 – Orders made by the Court on 26 November 2007 required Mr Vaysman to file an affidavit of his assets. He failed to do so in the required time. · Charges 55, 57, 61 and 67 – Mr Vaysman failed to cause four companies of which he was the sole director to comply with orders made by the Court requiring those companies to file affidavits as to their assets. 7 The substance of the charges which were found proven in Deckers (No 7) may be summarised as follows: · Charge 4 – Between March 2008 and January 2009 Mr Vaysman continued to manufacture counterfeit products at another factory in Moorabbin. In doing so he contravened orders made by the Court on 27 November 2007. · Charge 5 – Between March 2008 and January 2009 Mr Vaysman sold counterfeit products which he had made in the newly established factory. In doing so he also contravened the orders made on 27 November 2007. · Charge 12 – On 5 March 2009 Mr Vaysman breached an order of the Court, made on 21 January 2009, that he not approach within one hundred metres of the new factory. He persuaded the landlord's agent to give him a key to the premises and used it to enter the factory. He was, by chance, observed leaving between 8:00 and 9:00 pm at night. AFFIDAVIT EVIDENCE 8 Shortly before the originally scheduled penalty hearing Mr Vaysman affirmed an affidavit in which he deposed that he was 74 years old, suffered from significant health and physical problems and spoke little English. He also said that he could not read "any English". Despite this his affidavit was affirmed without translation. He added that, since he came to Australia, he found it very difficult to assimilate and to learn the language and culture. He said that a custodial sentence would be detrimental to his physical and emotional health. For the first time he expressed himself to be deeply remorseful and regretful for his conduct and apologised "to everyone that I have hurt." He deposed that he would "never repeat this conduct again." MEDICAL EVIDENCE 9 At the plea hearing counsel for Mr Vaysman tendered and relied on a series of medical reports. They were reports from: · Dr Gregory Belkin dated 10 August 2010 and 20 August 2010. · Dr Patrick O'Brien dated 15 June 2009 and 24 August 2009. · Mr Phillip Dingjan dated 31 July 2009. · Dr Boris Goloub dated 13 April 2009, 17 February 2010 and 3 June 2010. · Mr Jeffrey Cummins dated 16 August 2010. 10 Dr Belkin is Mr Vaysman's general practitioner. Dr Belkin has been treating Mr Vaysman since 1998. Dr Belkin recorded that Mr Vaysman's "main problems" over the period which he had been treating him were atrial fibrillation (heart rhythm disorder); prostatomegaly (benign, age related enlargement of the prostate gland); gastritis/duodenitis; impaired feeling of smell, impaired hearing which had worsened after a motor car accident in 2008; tinnitus; reactive anxiety/depression; and incidental acute respiratory, macular and skin problems. Dr Belkin advised that, apart from the tinnitus condition, Mr Vaysman's conditions had all improved under treatment. Mr Vaysman had been referred to a consultant psychiatrist, Dr O'Brien, and a psychologist, Dr Goloub. He had accepted these referrals but had declined a further referral to a hearing specialist whom Dr Belkin hoped might be able to treat Mr Vaysman's tinnitus. 11 Dr Belkin had referred Mr Vaysman to the Alfred Hospital with a view to him having an operation on his enlarged prostate. Counsel for Mr Vaysman advised the Court that Mr Vaysman had attended an appointment at the hospital in July. A specialist had told him of the risk of such an operation having regard to his heart condition and age. Mr Vaysman had decided to delay making a decision. He now says that he has decided that he wishes to undergo surgery and proposed to tell the specialist so when he next attends at the outpatients' clinic at the hospital on 14 September 2010. A notice from the hospital confirming an appointment for Mr Vaysman at the Urology Clinic on 14 September 2010 was tendered. No indication was given of how long it would be before the operation could be scheduled. 12 Dr O'Brien was principally concerned with complaints by Mr Vaysman about having a poor memory. Dr O'Brien referred Mr Vaysman to Mr Dingjan, a neuropsychologist, for further testing and diagnosis. Mr Dingjan reported that the testing did not disclose any evidence of a neurodegenerative disease. There was, however, evidence of stress and some variability of cognitive performance when Mr Vaysman was anxious. Dr O'Brien suggested that supportive measures to assist Mr Vaysman deal with his distractibility and stress, his sleep disturbance and tinnitus would be likely to improve his condition. 13 Dr Goloub is a psychologist. In both 2009 and 2010 Dr Goloub found Mr Vaysman to be "extremely disturbed". He suffered from anxiety and distress. He had also suffered from panic attacks. 14 In his 2009 report Dr Goloub records that Mr Vaysman "believe[d] that something wrong is happening." He went on to explain: "He [Mr Vaysman] never was in such a situation before and does not understand the investigation and court process and what he is required to do, hence he breached some court orders not having a clear understanding of the seriousness and associated requirements. In addition Mr Vaysman has partial loss of hearing and his mind is confused from time to time, which is accompanied with noticeable memory problems (he does not remember many things from past and present). Sometimes under the impact of the stress he demonstrates alogical behaviours, which he is not able to explain later in a relatively calm state." 15 By the time he saw Dr Goloub again in June 2010, Mr Vaysman was no longer prepared to acknowledge that he had breached Court orders. He told Dr Goloub that he: "… still does not understand why he should suffer and possibly face imprisonment for something that he never did. It was his son who conducted the business with whatever copy write (sic) breaches if any. Mr Vaysman believes that he is an accidental victim, who now encounters unnecessary trouble at the full scale. Therefore the elderly man is caught in a vicious cycle of destructive thoughts and emotions: he has not done anything to be exposed to the legal proceedings, there is a possibility that his son did something wrong (which upsets the father), the man's other relatives are exposed to the proceedings too, the health continues to worsen due to the upheaval, and he does not see "light in the end of the tunnel"." 16 Mr Cummins is a consulting clinical and forensic psychologist. He saw Mr Vaysman at the request of his solicitors on 4 August 2010. Mr Cummins had been told that Mr Vaysman had been found guilty of the 10 contempt charges and had read my reasons for judgment. Mr Vaysman gave Mr Cummins an exculpatory history of some of the events which led to him being found to be in contempt of Court: "[Mr Vaysman] summarised his current legal situation by stating words to the effect of – "My son had a factory and I worked in the factory. The real estate agent who was managing the factory said if I didn't pay two months' rent I had to take all the stock out and sell it, so the agent said I could collect the key. I went to the factory to take the stock out, but there was lots of equipment and after two hours the agent said I had to leave the premises. Apparently they were following me. I wasn't told I couldn't enter the building. The agent told me to go there and collect the stock. I said I couldn't take everything out in two hours. I didn't sign anything. I've been forbidden to attend the premises." I then explained to Mr Vaysman it was my understanding he had been found guilty of contempt of court. I asked him to explain on what basis he had been found guilty of contempt of court and he stated that he could not remember." Mr Vaysman told Mr Cummins that his son Vladimir had left the Moorabbin factory to him and gone overseas. He had no idea where Vladimir was living. He admitted to making moccasins at the factory. When asked by Mr Cummins why his son had left the country Mr Vaysman said that he did not know. 17 Mr Cummins was not persuaded that Mr Vaysman was being truthful about his claims of memory loss. In his report Mr Cummins noted that: "Significantly, in contract (sic - contrast) to his comments about not remembering dates, times and events, near the conclusion of the assessment he abruptly stated (according to the interpreter) he needed to put some money in the meter and he then left the consulting rooms and returned several minutes later." 18 Mr Cummins noted that Mr Vaysman presented "as being of normal and average intellectual ability." He considered that Mr Vaysman was "in a state of denial concerning his legal situation …" Mr Cummins concluded that Mr Vaysman had developed a chronic adjustment disorder with mixed disturbance of emotions and conduct. SUBMISSIONS ON PLEA 19 Counsel for Mr Vaysman acknowledged that he had committed serious offences which warranted a term of imprisonment being imposed. He, nonetheless, contended that a range of mitigatory factors warranted any term of imprisonment being wholly and conditionally suspended. Age and ill health 20 The first of the mitigating factors relied on by counsel was Mr Vaysman's age which, it was contended, in conjunction with his medical and psychological problems, would make it more difficult for him to serve a sentence of imprisonment than would be the case for a younger person. Furthermore, there would be no interpreter to assist him to communicate in prison and he would be separated from his wife of 50 years. 21 The age and ill health of an offender is a consideration of variable weight in determining an appropriate penalty. As the Victorian Court of Criminal Appeal said in R v Bazley (1993) 65 A Crim R 154 at 158: "The age of an offender is no doubt a relevant sentencing consideration. It may in some cases be of considerable significance. But it cannot be allowed to be a justification for the imposition of an unacceptably inappropriate sentence." See also R v Van Boxtel (2005) 11 VR 258 at 317; R v Cumberbatch (2004) 8 VR 9 at 13. 22 In R v RLP [2009] VSCA 271 the Victorian Court of Appeal reviewed the relevant authorities and distilled from them the following propositions (at [39]): "1 The age and health of an offender are relevant to the exercise of the sentencing discretion. 2 Old age or ill health are not determinative of the quantum of sentence. 3 Depending upon the circumstances, it may be appropriate to impose a minimum term which will have the effect that the offender may well spend the whole of his remaining life in custody. 4 It is a weighty consideration that the offender is likely to spend the whole or a very substantial portion of the remainder of their life in custody. 5 Other sentencing considerations may be required to surrender some ground to the need to exercise compassion to take account of the real prospect that the offender may not live to be released and that the offender's ill health will make his or her period of incarceration particularly onerous. 6 Just punishment, proportionality and general and specific deterrence remain primary sentencing considerations in the sentencing disposition notwithstanding the age and ill health of the offender. 7 Old age and ill health do no justify the imposition of an unacceptably inappropriate sentence." 23 Counsel for Mr Vaysman pointed to Mr Vaysman's advanced age – 74 – and to the various medical reports which he said provided evidence of Mr Vaysman's poor physical and mental health. He submitted that imprisonment would be likely to have an adverse impact on the medical conditions already suffered by Mr Vaysman. He placed particular reliance on Mr Cummins's finding that Mr Vaysman suffered from a recognised psychological condition. 24 There can be no doubt that Mr Vaysman suffers from a number of medical conditions. Apart from the tinnitus they have responded to treatment. Dr O'Brien considers that the tinnitus is also manageable if Mr Vaysman were to adopt various supportive measures which he had suggested. None of the medical reports offered an opinion as to the likely effect of incarceration on any of the conditions from which Mr Vaysman suffers. In particular, Mr Cummins did not suggest that a chronic adjustment disorder would have any adverse impact on Mr Vaysman should he be imprisoned. 25 It is next to be observed that Mr Vaysman's medical problems did not prevent him from working between 2007 and 2009. He repeatedly told the court that he was anxious to continue working manufacturing footwear. There is good reason to believe that, had his activities at the Christensen Street factory not been discovered, he would probably still be working on those premises producing footwear. 26 There can be no doubt that Mr Vaysman is agitated and anxious as a result of being found guilty of a number of charges of contempt of Court. He is naturally apprehensive about the prospect of a term of imprisonment being imposed. There is, however, no evidence that he is seriously ill or any evidence to support the proposition that ill health will make any period of incarceration imposed on him "particularly onerous." This is not a case in which Mr Vaysman would be expected to spend most of his remaining years in custody. 27 On the other hand it is necessary, in sentencing Mr Vaysman, to take into account his age, his infirmity and the language and cultural issues which will be likely to have an adverse impact on him if he is imprisoned. While these considerations do not, in my opinion, justify a wholly suspended sentence, they may warrant a partially suspended sentence. Previous good character 28 Counsel advised that Mr Vaysman had no prior convictions. He submitted that Mr Vaysman had come to Australia in difficult circumstances as a refugee immigrant and had, by dint of hard work, been able to live a good and productive life. He had raised a small family and been a good provider for them. These are matters properly to be taken into account in his favour. 29 They must, however, be balanced against other aspects of his conduct in the course of the present litigation. Mr Vaysman gave a considerable amount of untruthful evidence to the Court relating to his involvement in the manufacturing business conducted by his son and in relation to his financial circumstances. He claimed, for example, to be impecunious when he had accumulated pension payments standing to his credit in a bank account which had not been drawn on for many years. He assisted his son by acting as the sole director of a number of companies which served as vehicles for the conduct of various aspects of the business. He operated bank accounts for some of these companies. Hundreds of thousand of dollars passed through these accounts. He personally made and sold counterfeit footwear. Such conduct clearly undermines his claim to have been of good character. Delay 30 A further mitigatory factor advanced by Mr Vaysman was that seventeen months had elapsed since the last charges were preferred against him. He was said to suffer from continued psychological distress connected to the proceeding. He had committed no breaches of the Court's orders in this period and the experience had already had a deterrent effect on him. 31 It is to be acknowledged that the contempt proceedings have been hanging over Mr Vaysman for some time. The delay in bringing them to conclusion has been brought about by a number of factors. The making and publication of findings in relation to the contempt charges was delayed until the principal proceeding had been heard and determined. Both the hearing of the principal proceeding and the contempt proceeding were delayed repeatedly by the vacation of hearing dates and adjournments brought about by Mr Vaysman's lack of readiness to proceed. The hearing and determination of the first set of contempt charges was delayed by the discovery that Mr Vaysman had continued his contemptuous conduct during 2008 and the subsequent laying of further charges. 32 I place little weight on Mr Vaysman's complaints relating to delay. Nor am I persuaded, for reasons to which I will return, that Mr Vaysman has personally been deterred from misconduct by reason of the charges being preferred against him. I take into account, in his favour, the absence of any contraventions of the Court's orders since the last set of charges were laid. Financial effect of the proceedings 33 Mr Vaysman contends that "his financial position, and that of his family, has been devastated by these proceedings." He claims to have "suffered substantially". Unpaid judgment debts arising from the orders made in the principal proceeding have led to Mr Vaysman being declared bankrupt. Such equity as he had in his family home and the home of his son has been lost. This has occurred because of his involvement in infringement of the Applicant's intellectual property rights over some years. 34 I have already noted that, at relevant times, some hundreds of thousand of dollars have flowed through accounts over which Mr Vaysman had control as the registered signatory. Mr Vaysman has failed to account for any of this money. On 13 March 2009 I explicitly invited him to explain how he came by such large sums and what he had done with them. No explanation has been forthcoming. 35 Mr Vaysman has repeatedly failed to comply with orders which required him to make full disclosure of his personal financial situation and that of companies associated with him. 36 In the absence of such disclosure I do not consider that Mr Vaysman is entitled to any allowance being made for the financial position in which he finds himself. Parity 37 In Deckers (No 8) I sentenced Mr Vaysman's daughter, Victoria, to be imprisoned for a period of 12 months for contempt of Court. The first two months were to be served and the balance suspended on condition that she refrain from further contraventions of the Court's orders for a period of two years. The nature of the charges which she faced and my reasons for imposing the custodial sentence on her are explained in Deckers (No 8) at [20]-[49]. 38 Counsel for Mr Vaysman submitted that the parity of sentencing principle required that Mr Vaysman be treated more leniently than his daughter because she had been found guilty of seven charges which related to conduct which had occurred over a longer period (four years) than that over which Mr Vaysman's offences had been committed (two years) and that Victoria had played a more central role in the business which was controlled by her brother Vladimir. 39 There can be no doubt that unjustified disparity of sentencing as between co-offenders is to be avoided to ensure fairness in the administration of justice: see R v Lowe (1984) 154 CLR 606 at 610-11. 40 The submissions made on behalf of Mr Vaysman proceed on the premise that his offending was less serious than that of his daughter. I do not accept that this is the case. The most egregious breaches of the Court's orders which led to the laying of Charges 4, 5 and 12 against Mr Vaysman in 2009, were far more serious than any of the conduct engaged in by Victoria Vaysman. After the manufacturing operations at the Roper Street factory had been discovered at the end of 2007 and the production process was effectively closed down, Mr Vaysman wished to continue manufacturing counterfeit footwear. He sought and obtained the assistance of Vladimir to establish a new factory at Christensen Street Moorabbin. The premises were leased by Sanauria Pty Ltd ("Sanauria'), a company of which Mr Vaysman was the sole director. He entered into the lease on behalf of Sanauria on 28 February 2008. Machinery was installed and production of counterfeit footwear soon resumed. Mr Vaysman purchased the machinery for use at Christensen Street. He continued to operate the business at Christensen Street until he was discovered in January 2009. He did so despite having been served with an amended statement of charges in respect of his earlier conduct at Roper Street. The amended charges were laid on 14 March 2008. The gravity of his offending was compounded when, on 5 July 2008, he instructed senior counsel who then appeared on his behalf to advise the Court that he and his wife had "never intended to break the [November 2007] orders and certainly intend to abide by the orders of the Court in the future … They are completely prepared to make further undertakings to abide by Court orders": see Deckers (No 7) at [11]. Despite these assurances he continued to produce counterfeit products at Christensen Street. 41 There are further matters which distinguish Mr Vaysman's offending from that of his daughter. Victoria made full admissions. Mr Vaysman has not done so. Victoria also apologised to those who had suffered because of her misconduct. Mr Vaysman made a belated apology in an affidavit which was filed shortly before the originally scheduled date of the plea hearing. The sincerity of this apology is open to doubt given the exculpatory accounts of his conduct which he has recently provided to Dr Goloub and Mr Cummins. OTHER CONSIDERATIONS 42 I am far from satisfied that Mr Vaysman acknowledges and accepts that he has contravened orders made by the Court. In 2009 he told Dr Goloub that he had breached some Court orders because he did not understand those orders and the requirements they imposed upon him. In June 2010, however, he denied to Dr Goloub that he had ever done anything wrong and sought to lay all the blame on his son. He portrayed himself as "an innocent victim". As recently as 4 August 2010 Mr Vaysman told Mr Cummins that he hadn't been told that he could not enter the Christensen Street factory. He so advised Mr Cummins notwithstanding the fact that he had been ordered, on 21 January 2009, not to approach within 100 metres of the premises and that that order had been translated to him in the Russian language. He had also admitted, on affidavit, that, when he attended at the premises on 5 March 2009, he knew that he was acting in breach of the order: see Deckers (No 7) at [4] and [31]. 43 Mr Vaysman has, since November 2007, consistently chosen to ignore orders made by the Court. In November and December 2007 he blatantly continued manufacturing counterfeit footwear at the Roper Street factory until his activities were discovered and he was no longer able to work at that factory. He then contrived to resume manufacturing at the Christensen Street premises and was able to do so for a year before he was again discovered producing fake Ugg products. While I accept that Vladimir Vaysman oversaw the operations at Roper Street and Christensen Street and was the main offender, Mr Vaysman played a central role in the illicit business by applying his skills to the manufacture of counterfeit products. 44 Mr Vaysman's failures to comply with orders relating to the disclosure of the financial position of himself and companies of which he was a director are of less seriousness but nonetheless reflect his dismissive attitude to compliance with Court orders. 45 As was the case with Vladimir Vaysman, the need for both personal and general deterrence rank highly as considerations in the sentencing of Mr Vaysman. His conduct warrants nothing less than a sentence of imprisonment. So much has been acknowledged by counsel appearing for him. PENALTIES 46 The charges of which Mr Vaysman has been found guilty vary in severity and these variations need to be reflected in the length of the sentences which are to be imposed. 47 I regard the most serious offence to be that covered by Charge 4 of the 2009 charges. It warrants a sentence of imprisonment of 18 months. On the other charges I would impose the following penalties with each sentence to be served concurrently with each other sentence, including that imposed in relation to Charge 4: · Charge 36 – two months' imprisonment. · Charge 37 – nine months' imprisonment. · Charge 52 – one month's imprisonment. · Charge 55 – one month's imprisonment. · Charge 57 – one month's imprisonment. · Charge 61 – one month's imprisonment. · Charge 67 – one month's imprisonment. · Charge 5 – six months' imprisonment. · Charge 12 – three months' imprisonment. 48 Having regard to Mr Vaysman's age and his indifferent health I will require that he serve six months' imprisonment and will suspend from execution the remaining period of the sentence. COSTS 49 The Applicant seeks an order that Mr Vaysman pay its costs on a solicitor-client basis. It has prosecuted the charges at considerable cost. It has not done so vindictively. It stood to make no financial gain by doing so. If the penalties imposed act as a deterrent to Mr Vaysman and others, the outcome of the contempt proceeding may have some indirect future benefit to the Applicant. In successfully prosecuting the charges the Applicant has sought to vindicate the authority of the Court. It should not have to bear the costs incurred by it in doing so. In such circumstances, in my opinion, the orders sought are appropriate. I certify that the preceding forty-nine (49) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Tracey. Associate: Dated: 15 September 2010