FEDERAL COURT OF AUSTRALIA ESPN, Inc v Thomas [2010] FCA 1232 Citation: ESPN, Inc v Thomas [2010] FCA 1232 Parties: ESPN, INC v ANDREW THOMAS and ROYAL AGRICULTURAL SOCIETY OF NSW TRADING AS SYDNEY SHOWGROUND File number(s): NSD 1525 of 2010 Judge: JAGOT J Date of judgment: 9 November 2010 Catchwords: TRADE MARKS – interlocutory injunction Legislation: Copyright Act 1968 (Cth) Fair Trading Act 1987 (NSW) Trade Marks Act 1995 (Cth) Date of hearing: 9 November 2010 Place: Sydney Division: GENERAL DIVISION Category: Catchwords Number of paragraphs: 21 Counsel for the Applicant: Mr R Cobden SC and Mr C Dimitriadis Solicitor for the Applicant: DLA Phillips Fox Counsel for the First Applicant: The First Respondent did not appear Solicitor for the Second Applicant: Mr S Sloan of Dibbs Barker IN THE FEDERAL COURT OF AUSTRALIA NEW SOUTH WALES DISTRICT REGISTRY GENERAL DIVISION NSD 1525 of 2010 BETWEEN: ESPN, INC Applicant AND: ANDREW THOMAS First Respondent ROYAL AGRICULTURAL SOCIETY OF NSW TRADING AS SYDNEY SHOWGROUND Second Respondent JUDGE: JAGOT J DATE OF ORDER: 9 NOVEMBER 2010 WHERE MADE: SYDNEY UPON THE APPLICANT BY ITS COUNSEL UNDERTAKING: (a) to submit to such order (if any) as the Court may consider to be just for the payment of compensation, to be assessed by the Court or as it may direct, to any person, whether or not a party, adversely affected by the operation of orders 1 to 4 below or any continuation (with or without variation) thereof; and (b)to pay the compensation referred to in (a) to the person there referred to, THE COURT ORDERS ON AN EX PARTE BASIS THAT: 1. Pending the final determination of these proceedings or further order, the first respondent, whether by himself, his servants or agents or otherwise, be restrained from, without the licence of the applicant, promoting, organising or conducting the event to take place in Sydney, Australia on 13 and 14 November or any similar sporting competition or event under or by reference to the name XSPORT GAMES, the name X GAMES or any substantially identical or deceptively similar name, the device set out in Part 1 of the schedule to these orders, the device set out in Part 2 of the schedule to these orders or any substantially identical or deceptively similar device, or any other name that includes both the elements "X" and "GAMES" (whether separated or together). 2. Without limiting order 1 above, pending the final determination of these proceedings or further order, the first respondent, whether by himself, his servants or agents or otherwise, be restrained from, without the licence of the applicant, distributing, making available or continuing to distribute or make available the promotional material copies of which are contained in Annexures E, F and G to the affidavit of Kathryn Howard affirmed 8 November 2010 and broadcasting or causing to be broadcast the radio advertisement referred to at paragraphs 12 to 15 of that affidavit. 3. Pending the final determination of these proceedings or further order, the first respondent forthwith remove from the website at www.xsportgames.com.au all copies of or links to the footage identified in EXHIBIT BT5 to the affidavit of Bridget Tilley sworn 5 November 2010. 4. Pending the final determination of these proceedings or further order, the first respondent, whether by himself, his servants or agents or otherwise, be restrained from, without the licence of the applicant, making a copy of, causing to be seen or heard in public or communicating to the public the footage referred to in order 3 above. THE COURT FURTHER ORDERS THAT: 5. The applicant be granted leave to file in Court an amended application and a statement of claim in the form provided to the Court on 9 November 2010. 6. The matter be listed for further directions in the week of 15 November 2010 before the Docket Judge. 7. Liberty to restore on 24 hours' notice. 8. Costs reserved. 9. Pursuant to s 50 of the Federal Court of Australia Act 1976 (Cth), access to the following documents be restricted to the solicitors and counsel for the parties pending further or other order: (a) Exhibits BT-1 to BT-4 tendered at the interlocutory hearing on 9 November 2010; and (b) Exhibit 6 tendered at the interlocutory hearing on 9 November 2010. 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 NEW SOUTH WALES DISTRICT REGISTRY GENERAL DIVISION NSD 1525 of 2010 BETWEEN: ESPN, INC Applicant AND: ANDREW THOMAS First Respondent ROYAL AGRICULTURAL SOCIETY OF NSW TRADING AS SYDNEY SHOWGROUND Second Respondent JUDGE: JAGOT J DATE: 9 NOVEMBER 2010 PLACE: SYDNEY REASONS FOR JUDGMENT 1 This is an application for interlocutory relief which is brought on an ex parte basis in circumstances which I will shortly describe. 2 The initiating application was filed on 5 November 2010. This application was brought against two respondents, the first being Andrew Thomas, and the second being the Royal Agricultural Society of NSW, trading as Sydney Showground (the RAS). The second respondent has appeared today, but the first respondent, Mr Thomas, has not. The application seeks relief against the respondents for alleged contraventions of the Trade Marks Act 1995 (Cth), the Fair Trading Act 1987 (NSW), the Copyright Act 1968 (Cth) and also alleges acts said to constitute the tort of passing off. 3 When the matter first came before the Court on 5 November 2010 the duty judge at that time, Foster J, made orders for substituted service having regard to the evidence then available to him concerning the difficulties which the applicant had experienced in effecting personal service on the first respondent. Foster J also adjourned the applicant's claim for interlocutory relief for hearing today. 4 The application for interlocutory relief is supported by five affidavits. They are: (1) The affidavit of Bridget Theresa Tilley affirmed 5 November 2010. Ms Tilley is the Australian Bureau Chief of the applicant, ESPN Inc. (2) The affidavit of Zoe McDonald affirmed 5 November 2010. Ms McDonald is a solicitor employed by the solicitors for the applicant. (3) The affidavit of Kathryn Leigh Howard affirmed 8 November 2010. Ms Howard is an administrative assistant employed by the solicitors for the applicant. (4) The two affidavits of Shauna Louise Ross affirmed 8 November 2010. Ms Ross is a solicitor employed by the solicitors for the applicant. 5 The principal affidavit of Ms Tilley provides a history of the applicant and its activities. From Ms Tilley's affidavit there is evidence that the applicant is a well known provider of sports related television and online programming. Further, that since 1996 the applicant has organised regular sports events for sports known as extreme sports, under the name X GAMES. These events have taken place in summer and winter formats in locations around the world, apparently are well attended and feature competitors from many countries, including Australia. These events have been widely promoted by the applicant, including in Australia. 6 In or about mid-August 2010 the applicant became aware that the first respondent was promoting and had organised an extreme sports event which was to take place in Sydney on 13 and 14 November 2010. This event was to take place under and by reference to the name XSport Games. 7 The applicant is the registered owner in Australia of two trade marks which are relevant for current purposes. These are trade mark number 707700 for the words "X GAMES" in class 41 in respect of "organising and conducting a series of sporting competitions and television coverage thereof" and trade mark number 1076451 for the words "X GAMES" in stylised form in class 41 in respect of, amongst other things, "television entertainment services in the nature of television programs in the field of sports events". 8 When it became aware of the proposed event under the name XSport Games, the applicant made inquiries and discovered that the first respondent, Mr Thomas, is the registered owner in Australia of trade mark number 1318266 consisting of the words "XSport Games" in respect of various services in class 41. This trade mark took effect from 1 September 2009. It also came to the applicant's attention that Mr Thomas is the registrant of the domain name "xsportgames.com.au" and has otherwise promoted XSport Games by reference to those names. 9 According to Ms Tilley's affidavit, the "xsportgames.com.au" website includes video footage of content made, produced and broadcast by the applicant of its sporting events known as X GAMES. Ms Tilley's affidavit identifies the footage of the X GAMES including on the first respondent's website. Ms Tilley also provides evidence that the applicant has not authorised the first respondent or any company associated with him to use the X GAMES trade marks of the applicant or to communicate in any way the footage of the X GAMES events which appeared on the website. 10 On 24 August 2010 the applicant sent a letter of demand to the first respondent demanding that he and an associated business known as Final Siren Events immediately cease all use of the X GAMES trade mark and the X GAMES logo in connection with the event scheduled to take place on 13 and 14 November 2010. The letter requested that Mr Thomas provide the applicant with written assurances that this had been done by no later than 7 September 2010. A further letter of demand was sent on 2 September 2010. However, no response to either letter was received, despite the attempts of the applicant to ensure that both letters were brought to the attention of Mr Thomas. 11 The applicant then made preparations for the commencement of this proceeding, with a formal letter of demand being sent to Mr Thomas by the applicant's solicitors on 27 October 2010. However, according to the evidence before me, no response was received from the first respondent until an email was received by Shauna Ross, a solicitor employed by the solicitors for the applicant, at 5.59 pm on 8 November 2010. The email was from "andrew@xsportgames.com.au" and is in the following terms: I understand that this is going to court tomorrow, although I don't think that I will have time to arrange any representation for myself. ESPN's actions have resulted in the RAS [that is, the second respondent] cancelling my licence to use the venue, forcing me to cancel the event. I do not believe that I have done anything wrong and I do not admit any fault. Under these circumstances I believe there is no need for the orders you are seeking tomorrow. Please show this email to the Judge should you decide to go ahead with the application tomorrow. 12 In addition, I have been provided with a copy of an extract from the XSport Games website. That extract contains an advertisement for the event scheduled for 13 and 14 November 2010, and also contains a statement as follows: XSport Games® Stopped With a sense of disbelief, we must advise that Final Siren Events are unable to stage the upcoming XSport Games® over the weekend of 13-14 November 2010. This is due to an international broadcast company seeking a court injunction preventing the event from taking place. Partly due to this action, the Sydney Showground has also decided to revoke our event licence… It is unconscionable that both parties have chosen to issue this action at the 11th hour, leaving Final Siren Events no option for meeting our commitment to stage this auspicious event. We are in the process of challenging this action, and encourage you to join us in this fight for the Action Sports Industry as a whole. 13 As noted, the second respondent, the RAS, has appeared. In answer to a notice to produce the second respondent provided documents to the applicant (the documents produced thus far in answer to the notice to produce were tendered as exhibit 6 in the proceedings). These documents include the event licence (between RAS and Mr Thomas trading as Final Siren Events), correspondence from the RAS to the first respondent and a notice of termination of the event licence between the RAS and Mr Thomas trading as Final Siren Events. Mr Sloan, who appears on behalf of the RAS, has informed me that insofar as the RAS is aware, various events were to take place both within and outside of the licence area from the RAS. 14 The above circumstances must also be considered with the informality and lateness of the communications from the first respondent, the first respondent's failure to appear and a letter (marked as exhibit 3 in the proceedings) from McCallum Donovan Sweeney Solicitors to the applicant's solicitors dated 8 November 2010. This letter state: We advise that we no longer act for Andrew Thomas. He is in the process of appointing new solicitors in New South Wales. Therefore, we do not have instructions to accept service of any documents. 15 The applicant's position is that the interlocutory orders, as sought, should be made on an ex parte basis. The relevant principles for the grant of interlocutory relief are well known. First, whether the applicant has made out a prima facie case, in the sense that if the evidence remains as it is there is a probability that at the trial of the action the applicant will be entitled to relief. Second, whether the balance of convenience favours the grant of the injunction as sought. 16 In this case, I am satisfied on the basis of the evidence before me that the applicant has established its prima facie case of infringement of the registered trade mark 707700 ("X GAMES" in class 41) and 1076451 ("X GAMES" in a stylised form in various classes, including class 41), as well as the contraventions of the Fair Trading Act, passing off and infringement of the applicant's copyright in cinematographic films of the X GAMES events organised by the applicant. 17 I also note that the first respondent holds a registration for the trade mark "XSport Games", in class 41. In this context, it is important that the applicant seeks rectification of the Register of Trade Marks to remove that registration by way of final relief. It is true that by reason of s 122(1)(e) of the Trade Marks Act pending rectification, no injunction will lie to prevent the use of that mark by the first respondent on the basis of trade mark infringement. This is why, as the applicant has explained, the interlocutory restraint which is sought is based on the alternative causes of action under the Fair Trading Act and for the tort of passing off. 18 At this stage, it is sufficient to observe that the affidavits in support of the interlocutory application do establish that the applicant has substantial and valuable goodwill and reputation in and in relation to the X GAMES names and events, including in Australia. That is, there is a prima facie case that the first respondent's use of a similar name, such as XSport Games, for the promotion or conduct of a sporting event will amount to a contravention of the Fair Trading Act and/or passing off. 19 Ms Tilley's affidavit supports a conclusion that the balance of convenience favours the granting of interlocutory relief. There is sufficient material in Ms Tilley's affidavit to indicate that the use of the XSport Games name and logo for the promotion and conduct of sporting events has the potential to cause significant damage to the applicant and the goodwill and reputation in relation to the X GAMES event, which the applicant has built over a number of years. Also relevant is the fact that the first respondent has not appeared in relation to this interlocutory application, despite being on notice of the allegations against him since late August 2010. 20 Although this application for interlocutory relief is made only a few days before the event was previously scheduled to take place on 13 and 14 November 2010, the fact is that on the evidence, it appears that the first respondent has acted with his eyes open to the position of the applicant objecting to the conduct and promotion of the event under the XSport Games logo since late August 2010. 21 Given the material which is available in support of the application to which I have referred, I am satisfied that ex parte orders ought to be made as sought by the applicant on the usual undertaking as to damages which is proffered. I certify that the preceding twenty-one (21) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Jagot. Associate: Dated: 11 November 2010