FEDERAL COURT OF AUSTRALIA Enviro Pak Pty Ltd v New Horticulture Pty Ltd (No 3) [2015] FCA 195 Citation: Enviro Pak Pty Ltd v New Horticulture Pty Ltd (No 3) [2015] FCA 195 Parties: ENVIRO PAK PTY LTD ACN 116 567 018 v NEW HORTICULTURE PTY LTD T/AS GREEN PACK ACN 086 979 437 and JOACHIM WALTER KOESTERKE; NEW HORTICULTURE PTY LTD T/AS GREEN PACK ACN 086 979 437 and JOACHIM WALTER KOESTERKE File number: NSD 1124 of 2012 Judge: GRIFFITHS J Date of judgment: 10 March 2015 Legislation: Designs Act 2003 (Cth) Date of hearing: 10 March 2015 Place: Sydney Division: GENERAL DIVISION Category: No Catchwords Number of paragraphs: 12 Counsel for the Applicant: Mr C Lambert Solicitor for the Applicant: Mr P Tahar Counsel for the Respondents: The Second Respondent appeared by telephone on behalf of the First and Second Respondents IN THE FEDERAL COURT OF AUSTRALIA NEW SOUTH WALES DISTRICT REGISTRY GENERAL DIVISION NSD 1124 of 2012 BETWEEN: ENVIRO PAK PTY LTD ACN 116 567 018 Applicant NEW HORTICULTURE PTY LTD T/AS GREEN PACK ACN 086 979 437 First Respondent JOACHIM WALTER KOESTERKE Second Respondent AND: NEW HORTICULTURE PTY LTD T/AS GREEN PACK ACN 086 979 437 First Cross-Claimant JOACHIM WALTER KOESTERKE Second Cross-Claimant JUDGE: GRIFFITHS J DATE OF ORDER: 10 March 2015 WHERE MADE: SYDNEY THE COURT ORDERS THAT: 1. Order 2 made on 25 June 2013 is reaffirmed on the applicant's undertaking to prosecute with diligence and deliberate speed its application for an extension of time with IP Australia and any related appeal to the Administrative Appeals Tribunal. 2. The respondents are to file and serve any application for leave to amend their cross-claim by 1 June 2015. 3. The matter is listed for mention on 2 June 2015 at 9.30 am. 4. Liberty to apply on the giving of 48 hours' notice. Note: Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules 2011. IN THE FEDERAL COURT OF AUSTRALIA NEW SOUTH WALES DISTRICT REGISTRY GENERAL DIVISION NSD 1124 of 2012 BETWEEN: ENVIRO PAK PTY LTD ACN 116 567 018 Applicant NEW HORTICULTURE PTY LTD T/AS GREEN PACK ACN 086 979 437 First Respondent JOACHIM WALTER KOESTERKE Second Respondent AND: NEW HORTICULTURE PTY LTD T/AS GREEN PACK ACN 086 979 437 First Cross-Claimant JOACHIM WALTER KOESTERKE Second Cross-Claimant JUDGE: GRIFFITHS J DATE: 10 Mar 2015 PLACE: SYDNEY REASONS FOR JUDGMENT 1 The proceedings were commenced by the applicant on 9 August 2012 when it filed an originating application seeking various relief concerning an alleged breach of its registered design 304960 by the respondents. It sought declaratory and injunctive relief. 2 On 8 August 2012, the first respondent had asked the Registrar of Designs to revoke registered design 304960. On 6 December 2012 the first respondent asked the Registrar of Designs to examine the registered design for this purpose. On 25 June 2013, on the application of the respondents, the Court stayed the proceedings in the Court pending finalisation of the consideration and determination by the Registrar of Designs of the first respondent's applications dated 8 August and 6 December 2012 respectively. 3 In February 2015, the respondents asked to have the proceedings relisted having regard to the fact that the Registrar of Designs had completed the examination and had determined to revoke the design. IP Australia advised the Court of this outcome under cover of a letter dated 16 February 2015, in which it also stated that the design registration had ceased in law on 10 May 2014 and had been advertised in the Australian Official Journal of Designs on 18 September 2014. It also advised that the applicant was notified of this outcome on 11 September 2014. 4 The matter was listed for directions on 19 February 2015. Mr Tahar, solicitor, who acts for the applicant, advised the Court that, while he had not acted for the applicant in relation to the matters before IP Australia, he now had instructions "to immediately file under s 68(6) of the Designs Act 2003 appeal (sic) against the decision of the Registrar". Directions were made for the applicant to file and serve within 14 days an application for an extension of time and supporting evidence and the matter was listed for further directions on 10 March 2015. 5 At the directions hearing on 19 February 2015, the second respondent (who had been granted leave on 2 April 2013 to represent the first respondent) advised the Court that he would not only be seeking to have the originating application dismissed, but that he would also seek costs and damages. It was brought to his attention that his cross-claim contained no claim for damages and that if he wished to seek damages he would need to attend to seeking leave to file an amended cross-claim. It appeared that the respondents wished to raise one or more economic torts in their cross-claim. 6 By an email dated 2 March 2015, Mr Tahar emailed my associate and advised that, despite what the Court had been told on 19 February 2015, the applicant would not at this time be filing an appeal under s 68(6) of the Designs Act 2003 (Cth), nor seek an extension of time from the Court to enable such an appeal to proceed. 7 Prior to the directions hearing today, the applicant filed an affidavit by its sole director, Mr John De Flumeri, which described some of the dealings between the applicant and IP Australia. It is unclear whether the affidavit comprehensively describes all those dealings. The key relevant points to emerge from the affidavit and other material adduced by the respondents appear to be as follows: IP Australia conducted both an examination and a re-examination of the design and concluded in both cases that the design was not new or distinctive because it was substantially similar in overall impression to a design in the prior art base. IP Australia determined to revoke the registration. Mr De Flumeri did not provide the Court with a copy of either the first or second examination report; IP Australia advised Mr De Flumeri in a letter dated 15 April 2014 that the registration would cease on 10 May 2014 and that if he wished to request a hearing in respect of the matter he should do so before that date. No such request was apparently made prior to that date; apparently, by letter dated 21 July 2014, which was not received by IP Australia until 25 August 2014, the applicant requested a hearing; Mr De Flumeri said that his request was apparently refused on 24 August 2014, but the more likely date is 11 September 2014, which was when he was sent a letter from IP Australia, received by him on 18 September 2014, and told that at this late stage, he could not simply request a hearing. He was also advised that the design had ceased; by letter dated 12 December 2014, which was not received by IP Australia until 16 February 2015, the applicant complained about the process and the refusal to grant him a hearing. Mr De Flumeri complained that account had not been taken of all the information he had provided to IP Australia and he asked that he be given the benefit of a hearing in order to put his case; having received no response from IP Australia, Mr De Flumeri wrote again on 20 February 2015 inquiring about his earlier letter; by an email dated 27 February 2015, the Deputy Registrar of Designs at IP Australia, Mr Lovie, responded to Mr De Flumeri's correspondence. He said that he had reviewed the file and could not see any error and he confirmed that the registration of the design had ceased. He indicated that if the applicant had sought a hearing within the examination period i.e. before 10 May 2014, a hearing could have been conducted. He was also reminded that he had been advised of this deadline in the examiner's second report; Mr Lovie then indicated that the applicant may have several options, including lodging a request for an extension of time from 10 May 2014 to 25 August 2014 (i.e. for the period of time between the final date by which he could have sought a hearing of the examination and the date IP Australia received his letter requesting a hearing). He was advised that if the extension was granted, the status of the design would revert to "registered" while it is heard on the substantive examination matter; Mr Lovie also advised the applicant of the possibility of it seeking a review in the Administrative Appeals Tribunal of any refusal to grant him an extension of time – presumably these are references to ss 136 and 137 of the Designs Act 2003 (Cth); the applicant was advised that if it wished to make an application for an extension of time it had to do so by 27 March 2015 and, in order to avoid the history of correspondence going astray, it was urged to communicate with IP Australia via its eServices facility. 8 In light of the above, the applicant indicated this morning, through its Counsel, that it proposed to seek an extension of time from IP Australia and that the proceedings should be stayed pending consideration of the determination by either IP Australia and/or the Administrative Appeals Tribunal in respect of an extension of time application or related appeal. 9 Although I am deeply concerned about the long delays in these matters, it is evident from the above that IP Australia does not consider that the processes before it are finalised. It has given the applicant until 27 March 2015 to lodge an application for an extension of time within which to request a hearing of the examination. The existing stay should therefore continue but I believe that this should only occur on the giving of an undertaking by the applicant that it will prosecute any such application for an extension of time and any related appeal to the Administrative Appeals Tribunal with diligence and deliberate speed. Mr Lambert of counsel, who appeared for the applicant today, has given that undertaking on behalf of the applicant. 10 As noted above, the respondents have foreshadowed that they will seek costs as well as damages in respect of the proceedings in the Court, which they say should now be dismissed. It would be premature to dismiss the application while matters remain unfinalised in IP Australia. Accordingly, I believe that the proceedings should continue to be stayed to enable the processes within IP Australia to take their course. In the meantime, the respondents need to give consideration to whether or not they will seek leave to amend their cross-claim because, as noted above, there is at present no claim for damages. They also need to give further consideration to the material which is needed to support their further application for costs to be awarded on a lump sum basis, assuming that they ultimately establish an entitlement to costs. 11 In view of the complexities and history of the matter, I consider that this is an appropriate case to now make a referral for pro bono legal assistance from a solicitor and counsel to the respondents under rule 4.12 of the Federal Court Rules 2011. I will also direct that any application for leave to amend the cross-claim be filed and served on or before 1 June 2015. I will list the matter for mention on Tuesday 2 June 2015 at 9.30 am, for the purposes of obtaining an update as to the processes within IP Australia and/or the Administrative Appeals Tribunal. 12 Accordingly, I make the following directions: (1) Order 2 made on 25 June 2013 is reaffirmed on the applicant's undertaking to prosecute with diligence and deliberate speed its application for an extension of time with IP Australia and any related appeal to the Administrative Appeals Tribunal. (2) The respondents are to file and serve any application for leave to amend their cross-claim by 1 June 2015. (3) The matter is listed for mention on 2 June 2015 at 9.30 am. (4) Liberty to apply on the giving of 48 hours' notice. I certify that the preceding twelve (12) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Griffiths. Associate: Dated: 10 March 2015