FEDERAL COURT OF AUSTRALIA Bed Bath 'N' Table Pty Ltd v Global Retail Brands Australia Pty Ltd [2022] FCA 1380 File number(s): VID 314 of 2021 Judgment of: ROFE J Date of judgment: 11 November 2022 Date of publication of reasons: 18 November 2022 Catchwords: PRACTICE AND PROCEDURE – application for leave to file further evidence out of time – nature and complexity of evidence – reasons for and extent of delay – imminent commencement of hearing – case management principles Cases cited: Aon Risk Services Australia Limited v Australian National University (2009) 239 CLR 175 Samsung Electronics Co. Limited v Apple Inc. [2013] FCAFC 138 Solahart Industries Pty Ltd v Solar Shop Pty Ltd (No 1) (2010) 88 IPR 337 Tamaya Resources Limited (in liq) v Deloitte Touche Tohmatsu (A Firm), in the matter of Tamaya Resources Limited (in liq) [2015] FCA 1098 Tamaya Resources Limited (in liq) v Deloitte Touche Tohmatsu (A Firm) [2016] FCAFC 2 Division: General Division Registry: Victoria National Practice Area: Intellectual Property Sub-area: Trade Marks Number of paragraphs: 54 Date of hearing: 10 November 2022 Counsel for the Applicant: Mr Ian Horak SC and Ms Lucy Davis Solicitor for the Applicant: Phillips Ormonde Fitzpatrick Lawyers Counsel for the Respondent: Mr Peter Creighton-Selvay Solicitor for the Respondent: DLA Piper Australia ORDERS VID 314 of 2021 BETWEEN: BED BATH 'N' TABLE PTY LTD Applicant AND: GLOBAL RETAIL BRANDS AUSTRALIA PTY LTD Respondent order made by: ROFE J DATE OF ORDER: 11 November 2022 THE COURT ORDERS THAT: 1. The Respondent have leave to file and serve the following affidavits: (a) Steven Lew affirmed on 19 October 2022, other than paragraphs [25] to [27] (inclusive), [38], [39] and [42]; (b) Darron Gary Kupshik affirmed on 19 October 2022, other than paragraphs [5] to [27] (inclusive); and (c) Christopher Butler affirmed on 24 October 2022. 2. The Respondent pay the Applicant's costs of the interlocutory application dated 24 October 2022. Note: Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules 2011. REASONS FOR JUDGMENT ROFE J: 1 By interlocutory application dated 24 October 2022, the respondent in the proceedings (GRBA) seeks leave to file and serve four additional affidavits. GRBA relies upon an affidavit of Robynne Lyndsay Sanders, the DLA Piper partner with the care and conduct of the matter for the respondent, dated 24 October 2022 in support of its application. 2 The four affidavits are: (a) Steven Lew, a Director of GRBA, affirmed 19 October 2022 (Lew affidavit); (b) Darron Gary Kupshik, a Director and Chief Operating Officer of GRBA, affirmed 19 October 2022 (Kupshik affidavit); (c) Robynne Lyndsay Sanders, affirmed on 19 October 2022 (third Sanders affidavit); and (d) Christopher Butler, an Office Manager at Internet Archive, affirmed on 24 October 2022 (Butler affidavit). Together, the New Affidavits. 3 The applicant in this proceeding (BBNT) relies upon the affidavit of David Francis Stuart Longmuir affirmed on 8 November 2022 in support of its objection to leave being given. 4 The trial of the proceeding is set to commence on 29 November 2022 for 12 days. 5 The proceeding is a trade mark infringement proceeding. The applicant is the registered owner of three trade mark registrations (Australian trade mark numbers 654780, 654781 and 1878972) for the trade marks "BED BATH 'N' TABLE" and "BED BATH N' TABLE" in respect of a variety of goods and services. 6 Since at least 1975, the applicant has carried on a business throughout Australia operating retail stores and offering for sale homewares under and by reference to a trade mark incorporating the words "BED BATH N TABLE". 7 Since around May 2021, the respondent has commenced a business selling homewares under the name "House BED & BATH". The respondent has also filed a trade mark application for (the House Bed & Bath Logo), and also uses the House Bed & Bath Logo. 8 The applicant alleges that the respondent's conduct infringes its registered trade marks. There are also claims for relief for misleading and deceptive conduct and passing off. 9 There was until recently a cross-claim. On 8 November 2022, I made orders dismissing the cross-claim in the proceeding by consent. 10 The trial was originally set down to be heard in June 2022. However, following an interlocutory application filed by the applicant on 9 May 2022, seeking leave to file 25 additional lay witness affidavits as to customer confusion, the trial date was vacated. On 24 June 2022, I gave the applicant leave to file further "confusion" evidence and the trial was set down for hearing commencing 29 November 2022, with an estimate of 12 days. 11 The respondent was ordered to file any affidavit evidence in answer to the additional confusion evidence on or before 8 July 2022. 12 The last of the respondent's evidence in answer was served on 23 August 2022, including Mr Lew's second affidavit in the proceeding. 13 The applicant's reply evidence consisted of the affidavits of Mr Jonathan Dempsey made 27 September 2022 and Mr Longmuir made 28 September 2022. The Interlocutory Application 14 The applicant says that the first indication it received that the respondent wanted to file further evidence was on 19 October 2022 when it received copies of the New Affidavits. As far as the applicant was aware, the only evidence outstanding was reply evidence on the cross-claim (which was subsequently dismissed). 15 On 21 October 2022, in response to a letter the previous day from the applicant's solicitors, the respondent's solicitors noted that: (a) the majority of the evidence in the New Affidavits responds to the applicant's evidence in reply; (b) there were statements in the applicant's reply evidence that were factually inaccurate or misleading and that the respondent therefore needed to file additional evidence to correct that evidence; (c) the respondent intended to file a further affidavit of Christopher Butler, Office Manager of the Internet Archive the "wayback machine"; and (d) the respondent would not object to the applicant filing and serving evidence in response to the New Affidavits on or before 4 November 2022. 16 The applicant disagreed with the respondent's characterisation of the evidence in the New Affidavits. The applicant objects to leave being given to the respondent to file the New Affidavits on the basis that they: (a) go to new matters which are not in reply on the cross-claim (now dismissed); (b) are not merely responsive to the applicant's reply evidence (and it is not clear that they correct any factual inaccuracies or misleading statements in the applicant's reply evidence); (c) contain substantial evidence that is inadmissible or of low probative value; (d) raise a number of factual matters which the applicant should be entitled to investigate and make a determination as to whether any further evidence is required to be before the Court; and (e) are made significantly outside the Court ordered timetable for any other evidence, with an imminent trial and no prior notice of their content. Applicable Principles 17 The principles set out by the High Court in Aon Risk Services Australia Limited v Australian National University (2009) 239 CLR 175 are directly applicable to the present application. In Aon, the plurality (at [111]), when considering the issue of granting leave to amend, said that the court's discretion should: … not be approached on the basis that a party is entitled to raise an arguable claim, subject to the payment of costs by way of compensation. There is no such entitlement. All matters relevant to the exercise of the power to permit amendment should be weighed. The fact of substantial delay and wasted costs, the concerns of case management, will assume importance on an application for leave to amend. 18 The plurality also emphasised (at [112]) that although parties have a right to bring proceedings and make choices as to how they frame their case, limits will be placed upon their ability to effect changes in their pleadings, particularly when, as in the case here, the proceedings are advanced. The plurality observed that in seeking the just resolution of the dispute, reference is made to parties having a sufficient opportunity to identify the issues they wish to agitate. 19 The court also stressed the importance of an explanation by the party seeking to support the exercise of the court's discretion. The plurality said (at [103]): …Generally speaking, where a discretion is sought to be exercised in favour of one party, and to the disadvantage of another, an explanation will be called for. The importance attached by r 21 to the factor of delay will require that, in most cases where it is present, a party should explain it. Not only will they need to show that their application is brought in good faith, but they will also need to bring the circumstances giving rise to the amendment to the court's attention, so that they may be weighed against the effects of any delay and the objectives of the Rules… 20 The need for a satisfactory explanation has been emphasised in cases applying Aon. In Solahart Industries Pty Ltd v Solar Shop Pty Ltd (No 1) (2010) 88 IPR 337, Perram J refused an amendment application largely on the basis of the lack of any evidence of a satisfactory explanation. 21 GRBA bears the onus of showing that the interests of justice favour the granting of leave. Perram J in Solahart at [20] observed: …Where it is shown that real prejudice to an opposing party will result from the granting of an amendment the party seeking the amendment is exposed to the practical necessity of demonstrating that the infliction of that prejudice is justified by the circumstances giving rise to the necessity of amendment. It is for that reason that the present applicants must "bring the circumstances giving rise to the amendment to the court's attention, so that they may be weighed against the effects of any delay" (Aon Risk Services Australia Ltd v Australian National University (2009) 239 CLR 175 at [103] per Gummow, Hayne, Crennan, Kiefel and Bell JJ). 22 The Full Court observed in Samsung Electronics Co. Limited v Apple Inc. [2013] FCAFC 138 at [48]: Any assessment of case-management principles necessarily involves an assessment of many potentially competing considerations. Included in that assessment is a growing recognition of the necessity to resolve civil litigation as "quickly, inexpensively and efficiently as possible" (Federal Court of Australia Act 1976 (Cth) s 37M) and a recognition of the fact that the "achievement of a just but timely and cost-effective resolution of a dispute has effects not only upon the parties to the dispute but upon the court and other litigants" (Expense Reduction Analysts Group Pty Ltd v Armstrong Strategic Management and Marketing Pty Limited [2013] HCA 46 at [51] per French CJ, Kiefel, Bell, Gageler and Keane JJ). 23 Relevant factors to consider in determining whether to exercise the discretion were usefully summarised by Gleeson J in Tamaya Resources Limited (in liq) v Deloitte Touche Tohmatsu (A Firm), in the matter of Tamaya Resources Limited (in liq) [2015] FCA 1098 (Tamaya Resources); approved by the Full Court on appeal: Tamaya Resources Limited (in liq) v Deloitte Touche Tohmatsu (A Firm) [2016] FCAFC 2 at [125] (Gilmour, Perram and Beach JJ). Whilst these are expressed in terms of an amendment, they apply equally to the present case where leave is sought for late evidence. These factors are: (1) The nature and importance of the amendment to the party applying for it; (2) The extent of the delay and the costs associated with the amendment; (3) The prejudice that might be assumed to follow from the amendment, and that which is shown; (4) The explanation for any delay in applying for that leave; (5) The parties' choices to date in the litigation and the consequences of those choices; (6) The detriment to other litigants in the Court; and (7) Potential loss of public confidence in the legal system which can arise where a court is seen to accede to applications made without adequate explanation or justification. The New Evidence 24 Mr Lew is a Director of GRBA. The Lew affidavit is the third affidavit made by Mr Lew in the proceeding. In the Lew affidavit, Mr Lew give evidence as to matters including: (a) the frequency of co-location of HOUSE Bed & Bath stores in the same shopping centre or precinct as HOUSE stores; (b) products not sold at HOUSE Bed & Bath, and/or sold through the HOUSE stores, superstores or website, MyHouse stores or website, Robins Kitchen stores or website; (c) products sold at both HOUSE and HOUSE Bed & Bath; (d) HOUSE and HOUSE Bed & Bath store flooring; (e) retailers of bedroom and bathroom products in other countries; and (f) point of sale materials in the kitchenware sector. 25 Mr Kupshik is a Director and the Chief Operating Officer of GRBA. He has made one prior affidavit in the proceeding. Mr Kupshik gives evidence as to the following matters: (a) consignment labels for stock delivered to HOUSE Bed & Bath stores; (b) HOUSE Bed & Bath Click and Collect; (c) location of delivery bays for a selection of HOUSE Bed & Bath stores in Western Australia and Victoria; (d) HOUSE Bed & Bath holds policies; and (e) the Sunshine Plaza shopping centre listing. 26 Ms Sanders, the DLA Piper partner with carriage of the matter on behalf of GRBA, has made two prior affidavits in the proceeding. In the third Sanders affidavit, Ms Sanders annexes bundles of: (a) extracts from the Wayback machine website; (b) extracts from the websites of shopping centres and precincts, and other retailers; (c) search results from the European Union Intellectual Property Office's trade marks database for various searches; (d) search results from the United States Patent and Trademark Office's trade marks database for various searches; and (e) search results from the United Kingdom Intellectual Property Office's trade marks database for various searches. 27 Mr Butler gives evidence as to the Wayback machine created and operated by his employer, the Internet Archive. Mr Butler also annexes browser screenshots of the archived files for certain URLs on a certain date, which I was informed correspond with those annexed at [5] of the third Sanders affidavit. At the hearing of the respondent's application, the applicant did not object to the filing of Mr Butler's affidavit. 28 In addition to the Butler affidavit, the applicant does not object to two items of evidence in the New Affidavits. These are: (a) the domain name (Lew affidavit at [41]); and (b) the Sunshine plaza listing (Kupshik affidavit at [28] to [30]). Otherwise, the applicant objects to leave being given in respect of the entirety of the remainder of the New Affidavits. CONSIDERATION 29 The applicant considers that the New Affidavits purport to deal with a broad variety of topics, and it says that the evidence falls into three categories: (a) evidence of third-party conduct, which it says it will be unable to test as there will be no relevant witness to be cross examined at trial (third Sanders affidavit, Lew affidavit at [25], [26], [38] and [39]); (b) evidence of the respondent's business which is in inadmissible form, and which seeks to reply to the applicant's reply evidence (Lew affidavit); and (c) other evidence of the respondent's business which should properly have been filed as evidence in answer (Kupshik affidavit) 30 For the reasons below, I grant leave to the respondent to file certain parts of the New Affidavits only. New material not properly in reply and/or of marginal relevance 31 I agree with the applicant's contention that much of the new material is not in reply, or for that matter relevant. 32 For example, Mr Kupshik uses a reference to a courier label in Ms Brianna Moriarty's 25 January 2022 affidavit, to launch into an explanation of the format and preparation of the respondent's consignment labels, click and collect system, location of its delivery bays and "holds" policies. At the hearing, the respondent's counsel referred to an example from a 16 May 2022 affidavit made by Ms Elizabeth Dimopoulos, but the point remains the same. Both examples are from the applicant's evidence in chief and any response to that material should have been included in the respondent's reply. There is no satisfactory explanation as to the delay of many months. 33 Mr Lew, at [25], annexes photographs of retail stores in the United States, England and Canada. Ms Sanders annexes trade mark search reports from the United Kingdom, European Union and United States online trade mark databases for combinations of "bed" and "bath". Ms Sanders also annexes web pages from retailers around the world, including Pakistan and Germany, showing their use of the words "Bed" and "Bath", some of which are undated, and others of which are from 2022. The respondent says that the overseas evidence is in reply to matters raised in the applicant's reply evidence, which the respondent says is more in the way of evidence in chief. As such the respondent submits that this evidence could not have been filed as part of the respondent's evidence in answer and it was prepared and filed as soon as it could be. Explanation of delay 34 Ms Sanders provides an explanation of the delay in preparing the New Affidavits from the date of the last of the applicant's two reply affidavits on 28 September 2022, until the filing of the New Affidavits in mid to late October 2022. 35 The applicant takes issue with the detail of the explanation and says that GRBA has failed to provide a satisfactory explanation as to why it seeks to file this "reply" evidence at this late stage in the proceeding. The applicant notes the Kupshik affidavit is in response to the applicant's confusion evidence, some of which was filed in January 2022, and the last of which was filed in May 2022. 36 Other than to say that certain matters came to its attention during preparation for trial, the respondent does not provide an explanation as to why, when the material seeks to respond to matters, for example in affidavits filed in January and May 2022, it has taken almost eight months to put on responsive material, and why that material was not filed with the evidence in answer in July and August 2022. 37 The applicant takes issue with Ms Sanders' explanation as to the delay in filing the New Affidavits. In particular it says that there is no explanation why the third Sanders affidavit could not have been filed and served in late September if it did arise out of material in the reply affidavits. The third Sanders affidavit deposes to searches conducted over two days on 17 and 18 October 2022. No explanation was provided as to why the searches could not have been conducted a month earlier. Nature and importance of the new material to the respondent 38 The respondent asserts that the New Affidavits are necessary to correct matters arising from the applicant's reply evidence regarding the respondent's business which it regards as factually inaccurate, or which it says provides incomplete information about certain matters. This evidence is mostly that set out in the Lew affidavit relating to the products not sold at HOUSE Bed & Bath stores, but which Mr Lew says are sold at the HOUSE stores, superstores or website, MyHouse stores or website, Robins Kitchen stores or website. These are matters within the knowledge of the respondent and about which Mr Lew can be cross-examined. 39 The applicant contends that the New Affidavits relate to new matters sought to be relied upon as evidence in answer on the claim. As such that evidence should have been provided by 8 July 2022 at the latest. The applicant submits that New Affidavits are simply seeking to re-agitate matters that might have been bought forward as evidence in answer, and which could have been responded to by way of evidence in reply. The applicant also challenges the relevance of the new material. Prejudice to the applicant if leave given 40 The applicant submits that it will suffer substantial prejudice if the respondent is given leave to file the New Affidavits. 41 The application to file further evidence is made at a late stage in the proceedings and the circumstance of an imminent trial arises here. No warning was given to applicant prior to the New Affidavits being served that such evidence might be coming. 42 Leaving aside the relevance of the material sought to be introduced by the respondent, the applicant submits that the new material will require investigation and a possible response if it is to be placed into proper context. Such investigative work would have to be done whilst the applicant and its legal team are preparing for trial. The applicant will be forced to divert its resources to preparing responsive evidence rather than preparing for trial. 43 The respondent in correspondence accepts that it is appropriate that the applicant have an opportunity to respond. However, given that the trial is imminent, that concession is of little assistance in ameliorating the potential prejudice to the applicant. In oral submissions it appeared that the prejudice to the applicant resulting from the necessity for further enquiries was greatest in relation to the evidence as to the activities of third parties, where the applicant would have no witness who could be cross examined. Prejudice to the respondent if leave refused 44 The applicant submits that the respondent has not established that it would be prejudiced in the advancement of case if leave were refused. The respondent contends the evidence is relevant to the issues in dispute in a broad way. The applicant says that a large amount of material sought to be relied upon is of marginal (if any) relevance, of little (if any) weight and inadmissible, and for that reason there is little prejudice to the respondent if leave is not given. 45 The applicant gives as an example, the respondent's attempt to bring forward evidence of the position in foreign jurisdictions. The third Sanders affidavit annexes, amongst others, trade mark records from the European Union Intellectual Property Office's online trade marks database and the United States Patent and Trademark Office's database for the term "Bed & Bath". 46 The state of other markets is irrelevant and an unnecessary distraction insofar as it opens an enquiry about business conducted elsewhere and is not addressed to the conduct of businesses impacting on Australian consumers. Even if the position overseas was considered relevant the evidence that purports to demonstrate the position in those foreign jurisdictions is incomplete and generally unhelpful. Detriment to public confidence in the legal system 47 I agree with the applicant's submission that there is a public interest in the Court not allowing parties to file and rely upon evidence which is filed outside the timetable set by the Court, especially when the material is months, rather than days late, and there is an imminent trial date. CONCLUSION 48 Counsel for the respondent accepted that the Kupshik affidavit constitutes evidence in answer to the confusion evidence and should have been filed by 8 July 2022. There is no adequate explanation as to why this material was not filed in answer in accordance with the timetable set out in the orders, other than the inference that the evidence in chief was not looked at until recently in the course of preparation for trial. 49 I accept that the Lew affidavit arises partially from the applicant's reply evidence, so should be treated differently to the Kupshik affidavit. I consider that the parts of the Lew affidavit not relating to the respondent's business are of low probative weight. There would be prejudice to the applicant if that evidence was allowed, as there would be no one to cross examine from the third parties and no time for enquiries to be made. 50 I consider the entire third Sanders affidavit to be of marginal relevance. Substantial prejudice to the applicant would arise if leave was granted for the respondent to file that affidavit. There is again no time for enquiries to be made. 51 In addition, I consider there are also aspects of the New Affidavits which do not contain new material at all and repeat the evidence given in a previous affidavit. For example, the Lew affidavit at [27], [38] and [39]. 52 I find that the prejudice to the applicant (in terms of disrupted trial preparation and diversion of resources) outweighs any prejudice to the respondent in not being able to rely on the following material: (a) the third Sanders affidavit; (b) [25] to [27] (inclusive), [38], [39] and [42] of the Lew affidavit; and (c) [5] to [27] (inclusive) of the Kupshik affidavit. 53 I grant leave, as per the orders made by me on 11 November 2022, for the respondent to file and serve the following affidavits: (a) Steven Lew affirmed on 19 October 2022, other than paragraphs [25] to [27] (inclusive), [38], [39] and [42]; (b) Darron Gary Kupshik affirmed on 19 October 2022, other than paragraphs [5] to [27] (inclusive); and (c) Christopher Butler affirmed on 24 October 2022. 54 The respondent is to pay the applicant's costs of the interlocutory application dated 24 October 2022. I certify that the preceding fifty-four (54) numbered paragraphs are a true copy of the Reasons for Judgment of the Honourable Justice Rofe. Associate: Dated: 18 November 2022