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Federal Court of Australia - Full Court |
Last Updated: 8 October 2009
FEDERAL COURT OF AUSTRALIA
Bing! Software v Bing Technologies [2009] FCAFC 131
TRADE MARKS – first respondent
gave an undertaking during trial – appellant succeeded in trade marks
infringement claim under Trade Marks Act 1995 (Cth) before the primary
judge – injunction followed the terms of undertaking – whether
injunction too narrow in light
of the words "in relation to" in s 20(1) and s
120(1), as defined in s 7(4) of the Trade Marks Act – appellant did not
show that primary judge failed to have regard to s 7(4) – terms of
undertaking imprecise – injunction gave insufficient protection –
appeal allowed in part
TRADE PRACTICES – whether, on factual
findings, the primary judge erred in rejecting misleading and deceptive conduct
claim under s 52 of the Trade Practices Act 1974 (Cth) –
different nature of inquiries under s 120 of the Trade Marks Act and
s 52 of Trade Practices Act – role of appellate court in considering
primary judge’s evaluation of primary facts – no error disclosed
–
appeal dismissed
COSTS – exercise of discretion in
relation to costs by primary judge – no relevant error – appeal
dismissed
Trade Marks Act 1995 (Cth)
ss 7(4), 7(5) 10, 20, 120(1)
Trade Practices Act 1974 (Cth)
ss 52, 53
MID Sydney Pty Ltd v
Australian Tourism Co Ltd (1998) 90 FCR 236 cited
SAP Australia Pty
Ltd v Sapient Australia Pty Ltd (1999) 169 ALR 1 referred to
Chase
Manhattan Overseas Corp v Chase Corp Ltd (1986) 12 FCR 375
cited
Hornsby Building Information Centre Pty Ltd v Sydney Building
Information Centre Ltd [1978] HCA 11; (1978) 140 CLR 216 cited
Parkdale Custom Built
Furniture Pty Ltd v Puxu Pty Ltd [1982] HCA 44; (1982) 149 CLR 191 referred
to
Campomar Sociedad, Limitada v Nike International Ltd [2000] HCA 12; (2000) 202 CLR
45 referred to
Taco Co of Australia Inc v Taco Bell Pty Ltd [1982] FCA 136; (1982) 42
ALR 177 referred to
Lumley Life Ltd v IOOF of Victoria Friendly
Society (1989) 16 IPR 316 referred to
Global Sportsman Pty Ltd v
Mirror Newspapers Ltd (1984) 6 ATPR 40-463 referred to
Equity Access
Pty Ltd v Westpac Banking Corporation [1989] FCA 506; (1989) 16 IPR 431 referred
to
Australian Woollen Mills Ltd v FS Walton & Co Ltd [1937] HCA 51; (1937) 58 CLR
641 referred to
Wingate Marketing Pty Ltd v Levi Strauss & Co
(1994) 28 IPR 193; 49 FCA 89 referred to
Aldi Stores Ltd Partnership v
Frito-Lay Trading Co. GMBH (2002) 54 IPR 344 referred to
Pioneer
Kabushiki Kaisha v Registrar of Trade Marks [1977] HCA 56; (1977) 137 CLR 670 referred
to
Angoves Pty Ltd v Johnson (1982) 43 ALR 349 cited
Brother
Industries Ltd v Dynamic Supplies Pty Ltd [2007] FCA 1490; (2007) 73 IPR 507
cited
Thunderbird Products Corporation v Thunderbird Marine Products Pty
Ltd [1974] HCA 51; (1974) 131 CLR 592 referred to
Cretazzo v Lombardi (1975) 13
SASR 4 cited
Dr Martens Australia Pty Ltd v Figgins Holdings Pty Ltd (No
2) [2000] FCA 602 cited
Doric Products Pty Ltd v Lockwood Security
Products Pty Ltd (2002) 54 IPR 495 cited
House v The King [1936] HCA 40; (1936)
55 CLR 499 referred to
Shanahan’s Australian Law of Trade Marks
and Passing Off (Lawbook Co, 2008, 4th edition), M Davison, T
Berger, and A Freeman
BING!
SOFTWARE PTY LTD ACN 078 281 197 v BING TECHNOLOGIES PTY LTD ACN 098 420 903 and
STEVEN PATRICK CRANITCH
QUD 20 of 2009
KENNY, GREENWOOD
& LOGAN JJ
30 SEPTEMBER 2009
BRISBANE
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AND:
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THE COURT ORDERS THAT:
1. The appeal be allowed in part.
2. Order 3 of the orders made by the Honourable Justice Berna Collier on 10 December 2008 be varied by adding, after paragraph c and as part of her Honour’s orders, paragraph d, to read as follows:
"d. from using the word "bing":(i) upon the first respondent’s software;
(ii) in the distribution, sales or supply of the first respondent’s software;(iii) in the upgrading and updating of the first respondent’s software;
(iv) in or on any thing (whether in documentary, electronic or other form) used in describing, promoting, marketing or advertising the first respondent’s software; and
(v) in or on any thing (whether in documentary, electronic or other form) used in describing, promoting, marketing or advertising the distribution, sales, upgrading or updating of the first respondent’s software."
3. The appeal be otherwise dismissed.
4. The appellant pay the respondents’ costs of the appeal.
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ON APPEAL FROM A SINGLE JUDGE OF THE FEDERAL COURT OF
AUSTRALIA
|
|
BETWEEN:
|
BING! SOFTWARE PTY LTD ACN 078 281 197
Appellant |
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AND:
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BING TECHNOLOGIES PTY LTD ACN 098 420 903
First Respondent STEVEN PATRICK CRANITCH Second Respondent |
|
JUDGES:
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KENNY, GREENWOOD & LOGAN JJ
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DATE:
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30 SEPTEMBER 2009
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PLACE:
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BRISBANE
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REASONS FOR JUDGMENT
KENNY J:
1 The appellant, Bing! Software Pty Ltd, has sued the respondents, Bing Technologies Pty Ltd and Steven Patrick Cranitch, for trademark infringement, contraventions of ss 52 and 53 of the Trade Practices Act 1974 (Cth), and passing off.
2 At first instance, the learned primary judge held that there was no passing off and no contravention of the Trade Practices Act. Her Honour also held that, whilst there had been an infringement of the appellant’s registered trademark, the appellant should not be granted injunctive relief in its preferred terms.
3 The appellant appeals against her Honour’s judgment essentially on three grounds, namely that:
(a) the findings of the Court entitled the appellant to the injunctive relief that it primarily sought;
(b) the findings of the Court led to the conclusion that the first respondent, Bing Technologies, had engaged in conduct that had misled or deceived consumers, or was likely to mislead or deceive consumers, within the meaning of s 52 of the Trade Practices Act; and
(c) in view of the findings of the Court, her Honour erred in holding that the respondents were liable for only 80% of the costs of Bing! Software.
THE PARTIES AND THEIR MARKS
4 To place the litigation in context, something must first be said of the parties, their respective businesses, and the marks in question.
5 The appellant markets software primarily to law firms under the registered
trade mark 836622. The trade mark has a priority date
of 24 May 2000. The
registered trade mark 836622 is as follows:
6 The mark is registered in respect of the following goods and services:
Class 9 Software for the legal profession and other industries and professions not limited in any way to a specific industry or commercial sector. Class 35 Distribution and sales of computer software. Class 42 Design of computer software; programming maintenance, upgrading and updating of computer software for the legal profession and other industries and professions not limited in any way to a specific industry or commercial sector ...7 The appellant uses the mark on "the software (on-screen), on software user guides and on the footer of Family Court documents created using the software", as well as on the appellant’s software and marketing materials: see Bing! Software Pty Ltd v Bing Technologies Pty Limited (No 1) [2008] FCA 1760 at [6]. Further, the primary judge found (at [7]) that the appellant "maintains a website www.bing.com.au featuring the Bing Trade Mark, and since 1997 has also developed software products for various markets, all incorporating the word and following exclamation mark ‘BING!’".
8 The first respondent, Bing Technologies, carries on the business of providing an internet protocol postal mail service. The primary judge stated (at [8]) that:
The nature of the business is that, by using the service, customers of the first respondent can route letters over the internet and have them printed and posted at points closest to the recipient, with the result that customers experience faster, cheaper and more efficient letter-based communications.The primary judge apparently accepted the evidence of Mr Cranitch, who was found to be in effective control of the first respondent, that:
The first respondent did not sell a product, rather it sold a service, and that it did not target legal firms as customers in any marketing or advertising ... Approximately 90% of the first respondent’s income was derived from posting invoices, statements and debt collection letters.9 Further, the primary judge found (at [9]) that:
The first respondent purchased the domain name www.bing.com for $US25,000 and had purchased the domain names www.easymail.com and www.easymail.com.au from third parties. The first respondent has also registered the domain name www.easypost.com.au. In relation to the use of hardware and software, Mr Cranitch deposed:• the client creates the relevant letter;• the first respondent provides a print driver called "mail room";
• the driver is not sold, rather it is provided as a means to access the service;
• most of the first respondent’s clients use an older version of the print driver called EasyMail.
10 The primary judge
also found (at [10]) that the first respondent used a logo on its website and
its products that read:
11 As well, her Honour found (at [11] and [33]) that the first respondent
used the word "bing" in a number of other guises, including
as follows:
and
and
Bing
and
bing
12 The primary judge noted that, on 6 February 2007, the first respondent had lodged an application for the trade mark "Bing" for classes 9, 16, 38 and 39, described as follows:
Class 9 – electronic mail handling apparatus; electronic mail installations; electronic mail servers; electronic mail terminals; electronic mailing machines; stamping mail (apparatus to check). Class 16 – machines for office use for moistening mail; machines for office use for opening mail; machines for office use for signing mail; machines for office use for stamping mail; machines for office use for wrapping mail; machines for office use in addressing mail; machines for office use in cancelling mail; machines for office use in closing mail; machines for office use in endorsing (franking) mail; mail inserting machines for office use; mail order catalogue; mailers (office machines); mailing labels; printed sheets of paper for mailing purposes. Class 38 – data transmission by electronic mail; electronic mail; provision of electronic mail facilities. Class 39 – forwarding of mail; franking of mail; mail forwarding.The appellant had lodged opposition to the granting of the trade mark registration to the first respondent on 5 September 2007.
THE JUDGMENT AND FINDINGS OF THE PRIMARY JUDGE
13 The primary judge found that the appellant’s and the first respondent’s trade marks were not "substantially identical" for the purposes of s 120(1) of the Trade Marks Act 1995 (Cth), but that the first respondent’s use of "bing" in its different forms was such that it was deceptively similar to the appellant’s mark within the meaning of ss 10 and 120(1) of the Trade Marks Act: see Bing! Software [2008] FCA 1760 at [37] and [41]. Her Honour gave the following reasons (at [41]) in support of her finding of deceptive similarity:
1. The parties’ marks all feature the word "bing".
2. A customer using Bing! Software’s products or Bing Technologies’ internet postal service does so by using a computer. Regarding the first respondent’s advertisement in Virgin Blue’s in-flight magazine, her Honour stated that:
... the average consumer with ordinary intelligence with an imperfect recollection of the applicant’s trade mark, seeing or hearing the first respondent’s mark, might be caused to wonder whether goods or services supplied pursuant to the first respondent’s mark might be sourced from the applicant.
3. 3. There was evidence given by Mr James Helm and Mr Paul Kenna as to actual confusion in relation to Bing! Software’s mark and Bing Technologies’ marks. In particular, evidence by a Victorian solicitor (Paul Kenna) established that he knew of Bing! Software because of its conveyancing software and that, when he saw an advertisement placed by Bing Technologies in Virgin Blue’s in-flight magazine, he thought that Bing Technologies’ "mailing software" emanated from Bing! Software.
4. 4. There was expert evidence given by Associate Professor Alpert supporting a finding that the marks were deceptively similar.
14 The primary judge held (at [51]) that the appellant conducted a "software business" and that, amongst other things:
• [Bing! Software] "goods" are, in substance, software packages which generate Family Court forms and conveyancing forms;• [Bing! Software] produces licence agreements, user guides and marketing material relating to the legal software packages upon which [Bing! Software] trade mark appears;
• the trade mark is also registered in respect of services provided by [Bing! Software], including the distribution and updating of software it provides customers.
15 Whilst accepting that the first respondent was engaged in the provision of internet postal mail services and that these services were not prima facie goods or services in respect of which the appellant’s mark was registered, the primary judge held (at [52]) that the first respondent’s service was a "software-enabled service" (emphasis original). In particular, her Honour held that "the first respondent provides software, bearing the trade mark ‘bing’, to customers to allow customers to effect the internet postal service it provides, and to access that service". Her Honour concluded that this software was "considerably more than ‘incidental’ to the operation of the first respondent’s service". In view of this, her Honour held that the principles in MID Sydney Pty Ltd v Australian Tourism Co Ltd (1998) 90 FCR 236 at 242-243 and SAP Australia Pty Ltd v Sapient Australia Pty Ltd (1999) 169 ALR 1 at 11 were inapplicable to the case before her. Her Honour concluded (at [57]) that:
So far as concerns the software provided by the first respondent to its customers bear[s] the moniker "bing", in my view that software is a "good" which is both severable from the internet postal service, and would in other circumstances be capable of being the subject of a registered trade mark in its own right within Class 9. Similarly, distributing and updating that software are "services" within classes 35 and 42.Her Honour added (at [61]):
[T]he software used by the first respondent is a product in its own right – the copyright therein is owned by a third party, and the first respondent has exclusive distribution rights.16 Accordingly, the primary judge concluded (at [65] and [68]) that:
[P]utting aside for the moment the undertaking given by the first respondent ..., in my view the software provided by the first respondent and services in respect of distributing and updating that software, are goods and services in respect of which [Bing! Software’s] trade mark is registered. Accordingly, I find that the first respondent has infringed [Bing! Software’s] trade mark. ... As the conduct of the first respondent infringed [Bing! Software’s] trade mark, in my view it is clear that Mr Cranitch had procured or directed that conduct, and accordingly is similarly liable for such infringement ...17 The primary judge rejected the appellant’s claim that the first respondent had contravened s 52 of the Trade Practices Act, holding (at [76]) that:
... any brief association between the two trade marks in the mind of a member of the public would generally be of no significance, and that a significant number of members of the general public, in fact or by inference, have not been misled or would be likely not be misled by the first respondent’s use of the trade mark ‘bing’ for the purposes of s 52 TPA ...18 Her Honour explained (at [75]) that:
Assuming that it is "ordinary members" of the general public at whom the first respondent’s conduct is directed, it is clear however that evidence of misconception arising in the minds of members of the public was minimal. Such evidence of misconception as exists from the evidence of Mr Helm (primarily arising from the similarity of the domain names used by the parties), and Mr Kenna (arising from the advertisement in the Virgin Blue in-flight magazine), demonstrates that any confusion was transient and ephemeral. The evidence also indicates that, while there were a small number of instances of initial confusion, those instances were resolved at the point of inquiry. Indeed this could scarcely be otherwise – the goods and services of the applicant and the first respondent are so different that an ordinary member of the public seeking services offered by one of the parties would clearly not be satisfied by services offered by the other, and would realise this very quickly.19 As already noted, the primary judge also rejected the appellant’s claim regarding contravention of s 53 of the Trade Practices Act, primarily upon the basis that there was no evidence that any representations had been made of the kind described in s 53(c) and (d). Further, her Honour rejected (at [87]) the appellant’s passing off claim, upon the basis that there was no relevant misrepresentation, reputation, or likelihood of injury. It followed from this that the primary judge dismissed claims (at [92]) that the second respondent was liable in his personal capacity for breaches of the Trade Practices Act or passing off.
20 At trial, the appellant elected to seek damages, and not an account of profits. The issue of declaratory and injunctive relief was affected by an undertaking proffered by counsel for the first respondent on the second day of the trial, 11 March 2008. The transcript recorded the following (at 86):
MR CROWE: Your Honour, while Mr Cranitch is coming to the courtroom, I have instructions from the first respondent to offer an undertaking to the court – to give an undertaking to the court that the first respondent in relation to all references to the software, the subject of these proceedings, will not use the word "BING!" when directly referring to that software in any documentation, on websites, or otherwise. To make that plain it is not offering to change its name, but it is offering an undertaking that it will not refer to the software itself as BING! or any other combination of words using the word "BING!".21 On that day, counsel for the first respondent added (at 87):
... The undertaking is plain. Where there is a reference to software it will not be referred to as BING! software, or BING! mailroom software or any other combination of words using the name BING!.22 Subsequently, counsel for the first respondent explained (at 216; Bing!Software [2008] FCA 1760 at [109]):
In terms of the undertaking which has been provided, it’s not offered to limit the injunctive relief which would be made, your Honour. It’s provided, we say in a way which would avoid there being injunctive relief granted at all if you accepted our submissions in relation to the MID decision, the SAP decision, the fact that we were not using the mark in respect of the goods and services in respect of which it was registered. The purpose of the undertaking was just to, as I said, quite frankly, to bring ourselves even more squarely within the MID decision.23 Counsel for the appellant rejected these propositions, saying the first respondent would remain:
... free ... to continue describing its service as a software enabled service, to continue ... saying in relation to the service, one click of the button on your computer and your mail is instantly transferred through our service, to continue all of that activity, to continue advertising in the Virgin Blue magazine in an advertisement ... which we say ... was evocative of software.24 The primary judge accepted (at [108]) that, in an affidavit sworn on 12 March 2008, the second respondent, Mr Cranitch, set out the steps that the first respondent had taken "to change all uses of the word ‘bing’ in reference to software, where the word appears in documentation, on websites and otherwise, to its former name ‘EasyMail’". Her Honour said (at [108]):
Mr Cranitch’s evidence, which is unchallenged, was that from the afternoon of 11 March 2008:• he had directed staff of the first respondent that no software should be issued by the first respondent to any customers or any other persons;• the software could no longer be downloaded from the first respondent’s website at www.bing.com;
• he had instructed the staff of the first respondent to remove all references to the word "bing" in connection with software from the first respondent’s website at www.bing.com, which process should be completed within 7 days;
• he had directed the staff of the first respondent that no external marketing could be authorised by the first respondent which used the word "bing" in connection with the first respondent’s software;
• the first respondent’s document entitled ‘Software Licence Terms and Conditions’ which prefaced the instalment of the first respondent’s software, had been altered such that all references to the word "bing" in connection with software had been amended to read "EasyMail". Mr Cranitch deposed that this new licence agreement would be used in the future;
• a notice had been prepared which would be circulated to all of the first respondent’s staff to inform them of the undertaking and that, subject to the undertaking, the word "bing" would not be used with reference to software in any of the first respondent’s documentation, on websites or otherwise. A copy of the notice was attached to the affidavit;
• the first respondent had commenced its review and alteration of its user manual which accompanied software provided by the first respondent to its customers to allow customers to use the first respondent’s electronic postal network system. Mr Cranitch deposed that this would take three weeks to complete, and that the first respondent had issued a direction to its staff that no software was to be provided by the first respondent until the user manual had been corrected;
• the first respondent had commenced its review and alteration of its agreements, service application forms, promotion agreements, Bing pilot account request forms and other forms and agreements used by the first respondent which used the word "bing" in connection with software. Mr Cranitch deposed that he expected the review to take seven days to complete.
25 The primary judge concluded (at [111]) that "the plain effect of this undertaking, as implemented in accordance with Mr Cranitch’s affidavit, is that any infringement by the respondents of the applicant’s trade mark to the extent that the trade mark ‘bing’ appears on software provided by the first respondent has ceased". Her Honour explained her reasoning in the following passages (at [112]-[114]):
If "bing" does not appear on, inter alia, software, agreements pertaining to software, or computer screens with reference to software when a customer accesses the first respondent’s service or website, I understand that the first respondent would only use ‘bing’ to describe itself and the operation of its internet postal service. This service is not covered by the applicant’s trade mark. The fact that the internet postal service requires customers to use a computer and, invariably, software in the course of using the computer to effect and access the service – either the first respondent’s EasyMail software or alternative methods including emailing PDF attachments – does not mean in the circumstances following the provision of the undertaking that the first respondent’s conduct infringes the applicant’s registered trade mark. The first respondent’s internet postal service involves considerably more than use of software – indeed key activities are printing mail in the appropriate location, folding it and posting it. These activities are not goods and services the subject of the applicant’s registered trade mark. Mr Crowe SC submitted that, if the first respondent could not successfully rely on MID Sydney 90 FCR 236 prior to the provision of the undertaking, it could do so following the provision of the undertaking ... In my view this is not strictly the case. As I have already observed, I do not consider that MID Sydney 90 FCR 236 applies because I consider that the software is not "incidental" to the provision of the internet postal service in the sense used in MID Sydney 90 FCR 236 and SAP Australia 169 ALR 1. However, if the software provided by the first respondent does not bear the mark "bing", I do not see how the applicant’s trade mark is infringed through the first respondent continuing to call itself "bing" in relation to provision of an internet postal service, which ... uses a software called "Easymail". I do not accept that the applicant has a monopoly in the use of the name "bing" as a trade mark in respect of any service, including services which are not the subject of the applicant’s registered trade mark, simply because the service requires a person using it to use any form of software. Such a proposition, in my view, takes the applicant’s statutory monopoly beyond that sanctioned by the Act. The first respondent’s undertaking obviously does not address any past conduct which may have infringed the applicant’s trade mark. However, other than continuing to call itself "bing" in relation to provision of internet postal services where the mark "bing" does not appear on any software or in any documentary references to software, and which in my view constitutes neither infringement of the applicant’s trade mark nor misrepresentation in terms of the TPA or passing off, the applicant has not demonstrated conduct of the first respondent having an on-going effect for which the undertaking provided is not an answer in terms of the applicant’s contentions regarding use of the trade mark and software (contrast, for example, Yeatman v L Homberger & Co (1912) 29 RPC 645). I consider that the terms of the undertaking provided by the first respondent are adequate to protect any rights of the applicant has in relation to this matter.26 Paragraph 1(a) of the appellant’s amended application of 20 November 2007 had sought a declaration that:
.. the conduct of the first respondent in using the name or sign BING and trading under the name or style BING in connection with the distribution sale and supply of software within Australia ... infringes the [appellant’s] registered Trade Mark numbered 836622 BING!.Paragraph 2 sought an injunction restraining the first respondent "whether by itself, its servants, officers or agents from using within Australia the sign BING or any sign which is deceptively similar to the Bing Trade Mark as a sign in connection with the distribution, sale and supply of software". The primary judge held, however, that an injunction in these terms was not "warranted in light of the undertaking given by the first respondent", but her Honour was "prepared to make an order in terms of the undertaking given by the first respondent through its counsel on 11 March 2008": see Bing! Software [2008] FCA 1760 at [116]. Her Honour declined to grant a number of other orders sought in the appellant’s amended application (including for delivery up and destruction, change of corporate name, transfer of domain name) as well as an order for compensatory damages.
27 After the delivery of judgment, as the primary judge directed, the parties filed written submissions as to the form of the final injunction.
28 At a subsequent hearing, the appellant submitted that, in accordance with ss 7(4) and 120(1) of the Trade Marks Act, the preferable form of the injunction was as follows:
The Respondents are restrained by injunction from using as a trade mark a sign comprising the word bing, or any other sign that is deceptively similar to Trade Mark 836622, upon, or in physical relation or other relation to goods or services in respect of which the trade mark is registered.At the same time, without conceding that it ought to be made, the appellant put another form of injunction before her Honour, which was intended to reflect the undertaking that the first respondent had earlier proffered. The respondents supported this alternative form.
29 The primary judge ultimately adopted this alternative form and ordered that:
In relation to all references to software in the course of the first respondent’s business, the respondents are restrained by injunction:a. from using the word "bing" when directly referring to software in any documentation, on websites, or otherwise;
b. from referring to software itself as "bing" or any other combination of words using the word "bing";
c. where there is a reference to software from referring to it as "bing" software, or "bing" mailroom software or any other combination of words using the name "bing".
30 In another set of reasons for judgment – Bing! Software Pty Ltd v Bing Technologies Pty Limited (No 3) [2008] FCA 1869 at [7] – the primary judge explained her position as follows:
• I found in Bing! Software Pty Ltd v Bing Technologies Pty Limited (No 1) [2008] FCA 1760 that compliance by the first respondent with its undertaking meant a cessation of conduct infringing the applicant’s trade mark, and that injunctive relief in terms of that undertaking was appropriate. In my view the alternative wording of the injunction more accurately reflects that undertaking than the applicant’s preferred wording of the injunction. • The alternative wording of the injunction addresses the applicant’s concerns with respect to such products as BING! mailroom. • In relation to the applicant’s concerns relating to statements on the first respondent’s website such as "bing can handle any documents, even PDF’s from any software platform ...", I do not consider that such a statement would breach either the first respondent’s undertaking or the injunction I propose to make provided that it was clear that in doing so the first respondent was using the word "bing" to describe itself rather than software it supplies as part of its service. • I do not consider that it is necessary to make reference in the order to "or any other sign that is deceptively similar to Trade Mark 836622". As the applicant submitted, and as I found in my judgment, the applicant has an exclusive statutory monopoly to the trade mark "BING!" in relation to the goods and services in respect of which the trade mark is registered. The judgment dealt exclusively with the fact that the first respondent used the word "bing", and found that in doing so it had infringed the applicant’s trade mark. Whether any other sign of the first respondent (or anyone else, for that matter) is "deceptively similar" to Trade Mark 836622 for the purposes of s 10 and s 120 of the Act would require a separate determination by the Court. • In relation to the applicant’s concern that not all references by the first respondent to software as "bing" have ceased, in my view the applicant is in no stronger position as to enforcement of an injunction should the injunction be in the terms preferred by the applicant than if the injunction were to be crafted in the alternative wording proposed by the applicant. If conduct of the respondents breaches the injunction, appropriate remedies are available to the applicant. • While as a general proposition I accept that injunctive relief framed in the language of the Act is desirable, I do not consider that the applicant is in any way prejudiced by the drafting of the injunction in the alternative manner it proposes.31 With the respondents’ support, the primary judge also made two declarations that:
(1) the use by the first respondent of the word "bing" to describe, name or refer to software utilised by it or its customers was an infringement of the applicant’s trade mark no 836622; and (2) the first respondent’s conduct trading under and by reference to a name which includes the word "bing" does not infringe the said trade mark.32 Dealing with the question of costs, the primary judge noted that:
• Bing! Software succeeded in its breach of trade mark claim, though not in its Trade Practices Act and passing off claims;
• the factual and evidentiary matrix in support of the latter claims was the same as for the trade mark infringement claim;
• the Trade Practices Act and passing off claims took up minimal time at the hearing although attracted detailed written submissions;
• Bing Technologies’ undertaking was given on the second day of the three-day trial;
• the litigation had a substantial history prior to trial;
• Bing! Software succeeded in establishing that it was entitled to injunctive relief to protect its registered trade mark; and
• the case represented "a mixed outcome’ in which the applicant was to a degree successful.
33 Her Honour concluded (at [26]) that:
I do not think this is a case where the applicant should be liable for any of the respondents’ costs. However detailed submissions were made in respect of the failed TPA and passing off claims as well as the failed claims for pecuniary and ancillary relief. Further, a small amount of time was taken up at the trial in relation to the failed claims, and more time in relation to the relief in respect of which the applicant was unsuccessful and which was clearly an important aspect of the applicant’s case. On balance I consider the applicant is entitled to its costs, subject to a discount to reflect the only limited success of the applicant in relation to both its claims and relief. In the circumstances of this case I consider justice will be done as between the parties if I order the respondents to pay 80% of the applicant’s costs of the proceedings.SUBMISSIONS ON TRADE PRACTICES CLAIM
34 As already stated, the appellant contended that the findings made by the primary judge led to the conclusion that it had made out its claim against the first respondent for misleading and deceptive conduct in breach of s 52 of the Trade Practices Act. In particular, the appellant relied on her Honour’s findings, particularly at [41]: see paragraph [13] above. The appellant contended that, having regard to these findings, the primary judge erred in characterising consumer confusion as transient and ephemeral as she did at [75] of her reasons.
35 The appellant submitted that her Honour’s finding (supported by Mr Kenna’s evidence) – that an average consumer of ordinary intelligence and imperfect recollection of the appellant’s mark might, upon seeing the first respondent’s mark, be caused to wonder whether the first respondent’s goods and services emanated from the appellant – was relevant to the appellant’s misleading and deceptive conduct claim.
36 The appellant argued that, having found that there was evidence of actual confusion amongst consumers, then the primary judge ought to have found the appellant’s claim of misleading and deceptive conduct was made out. It was immaterial, so the appellant argued, whether or not this confusion was transient and ephemeral. Relying on SAP Australia at 607 [51], the appellant contended that it was enough to establish its s 52 claim that there was "initial confusion ... and conduct which misleads a customer so that, under some mistaken impression of a trader’s connection or affiliation, he or she opens negotiations ... even if the true position emerges before the transaction is concluded".
37 Further, the appellant submitted that, having accepted the evidence of actual confusion on Mr Kenna’s part and the expert evidence of Associate Professor Alpert as to initial consideration and purchase confusion, the primary judge could do no other than find that the first respondent had engaged in misleading and deceptive conduct.
38 In answer, the respondents submitted that the primary judge’s finding as to deceptive similarity under s 120(1) of the Trade Marks Act had little, if any, bearing on the appellant’s misleading and deceptive conduct claim, as the tests under s 120(1) of the Trade Marks Act and s 52 of the Trade Practices Act were different.
CONSIDERATION OF TRADE PRACTICES CLAIM
39 It is important in this appeal to bear steadily in mind the role of an appellate court when, in the exercise of its appellate jurisdiction, it is asked to consider the primary judge’s evaluation of the primary facts. For good reason, appellate courts have accepted the proposition that minds may reasonably differ where questions of fact and degree are involved, and thus in a doubtful case the appellate court should give weight to the views of the primary judge: see SAP Australia [1999] FCA 1821; 48 IPR 593 at 603 [37]- [38] and the cases there cited. Of course, it remains open to the appeal court to reach a contrary conclusion to the primary judge and to give effect to that conclusion.
40 The appellant’s principal challenge to her Honour’s reasoning on the s 52 claim concerned her observation that actual customer confusion was only transient and ephemeral that this was insufficient for a finding of misleading and deceptive conduct. I do not consider that the appellant’s submissions to this effect withstand analysis.
41 Section 52 of the Trade Practices Act prohibits a corporation from engaging in conduct in trade and commerce that is misleading or deceptive, or that is likely to mislead or deceive. The first respondent was a corporation engaged in trade and commerce. The words "engage in conduct" include the making of representations about a past, present or future matter. In this case, the impugned conduct could not be misleading or deceptive, or likely to be misleading or deceptive, for the purposes of s 52, unless it conveyed such a misrepresentation.
42 The primary judge’s treatment of the evidence as to confusion was central to the appellant’s argument. I accept that evidence of confusion is admissible, though rarely conclusive, to prove the nature of the impugned conduct. Proof of confusion or uncertainty in the minds of relevant members of the public, without more, does not ordinarily suffice to establish misleading and deceptive conduct: see SAP Australia at 602 [32], discussing Chase Manhattan Overseas Corp v Chase Corp Ltd (1986) 12 FCR 375 at 377 per Lockhart J. Where confusion associated with the impugned conduct is established, however, a question arises as to whether or not this confusion was caused by misleading and deceptive conduct on the respondent’s part: compare Hornsby Building Information Centre Pty Ltd v Sydney Building Information Centre Ltd [1978] HCA 11; (1978) 140 CLR 216 at 228 per Stephen J.
43 I put to one side the proposition, which found some voice in this case, that a finding of misleading and deceptive conduct enlarges the monopoly enjoyed by the proprietor of the registered mark. As their Honours said in SAP Australia at 602 [32], "[t]hat a finding of contravention might confer a de facto monopoly in a word or words when used in a particular context is not to the point in deciding whether conduct is misleading or deceptive or likely to mislead or deceive".
44 The most telling point was that made by the respondents. That is, I accept that, as the respondents submitted, the nature of the inquiries required by s 120(1) of the Trade Marks Act and s 52 of the Trade Practices Act are different: see M Davison, T Berger, and A Freeman, Shanahan’s Australian Law of Trade Marks and Passing Off (Lawbook Co, 2008, 4th edition) at [105.1025], Parkdale Custom Built Furniture Pty Ltd v Puxu Pty Ltd [1982] HCA 44; (1982) 149 CLR 191 at 198, and Campomar Sociedad, Limitada v Nike International Ltd [2000] HCA 12; (2000) 202 CLR 45 at 82; [2000] HCA 12; 46 IPR 481 at 506 [96]- [97] per Gleeson CJ, Gaudron, McHugh, Gummow, Kirby, Hayne and Callinan JJ. Accordingly, it was open to the primary judge to find that the first respondent’s impugned marks were deceptively similar to the appellant’s mark, for the purposes of s 120(1) of the Trade Marks Act, although the first respondent’s use of those marks did not amount to misleading and deceptive conduct for the purpose of s 52 of the Trade Practices Act.
45 On the other hand, as the appellant noted, it is well accepted that conduct may be relevantly misleading and deceptive even though such conduct does not induce, or is not likely to induce, entry into a commercial transaction: see SAP Australia at 607 [51]. Thus, as the Full Court in SAP Australia (at 607 [51]) said, "[c]onduct which misleads a customer so that, under some mistaken impression of a trader’s connection or affiliation, he or she opens negotiations or invites approaches may be misleading or deceptive even if the true position emerges before the transaction is concluded". Significantly for the present appeal, the Full Court said (at 607 [51]) that:
It is consistent with that general proposition, however, to accept that conduct may not be misleading or deceptive, or likely to mislead or deceive, notwithstanding that it may engender temporary and commercially irrelevant error: see Lumley Life Ltd v IOOF of Victoria Friendly Society (1989) 16 IPR 316; (1990) ATPR 40-987 at 50,838 per Lockhart J. The characterisation of conduct as "misleading or deceptive or likely to mislead or deceive" involves a judgment of a notional cause and effect relationship between the conduct and the putative consumer’s state of mind. Implicit in that judgment is a selection process which can reject some causal connections, which, although theoretically open, are too tenuous or impose responsibility otherwise than in accordance with the policy of the legislation. In some cases there will be a selection process analogous to that which arises under s 82 of the TP Act in a determination of whether or not a claimed loss was caused by a contravention: State Government Insurance Corp [v Government Insurance Office of New South Wales (1991) 28 FCR 511] at 563.46 The primary judge in that case had noted that there was evidence that, on occasions, people had mistakenly assumed a connection between the respondent’s Sapient Corporation or Sapient Australia and the applicant’s SAP Australia or Sapient College, but that the confusion was "promptly and easily" dispelled: SAP Australia (at 608 [52]). The Full Court observed (at 608 [52]-[54]) that:
In the context of that finding and the subsequent finding that the possibility of ‘false assumption or confusion’ would diminish as Sapient Australia established itself in the Australian market place, it can be said that his Honour treated the evidence of the incidents referred to as commercially irrelevant. In any event, they involved a ‘false assumption’ and ‘confusion’ neither of which is necessarily an indicium of misleading or deceptive conduct. This was reinforced in his Honour’s following observation that the SAP brand had become the indicium of the goods and services promoted under it. The way in which his Honour evaluated the evidence of incidents in which people assumed a connection between Sapient Corporation or Sapient Australia on the one hand and SAP Australia or Sapient College on the other hand, indicates that he made findings of fact about the nature of those assumptions and their significance, which he was entitled to make and which were not informed by any error of principle in the characterisation of Sapient Australia’s conduct under s 52. Much of the argument advanced in support of the appeal involved revisiting his Honour’s assessments and evaluation of the primary facts. It is true, as counsel for the appellants submitted, that the relevant date for the characterisation of the conduct complained of is the date of commencement of the proceeding. It was said that his Honour appeared to have, in effect, held that the respondent’s conduct was misleading at that date but was of a kind that was not likely to be misleading at a later date once Sapient Australia’s business became well established. However, his Honour was entitled to have regard to the transience of the confusion, of which there was only limited evidence, in his characterisation of the conduct complained of as at the time when that conduct occurred. That is a different process from deciding that conduct is not misleading or deceptive because, although misleading or deceptive today, it is unlikely to be misleading or deceptive at some time in the future. His Honour’s evaluation of the evidence involves, in our opinion, a realistic assessment of the commercial significance of the conduct of Sapient Australia which is complained of by the SAP companies. On his Honour’s findings of fact, and having regard to the various aspects of the evidence to which we were taken, there was an air of unreality in the attempted characterisation of Sapient Australia’s conduct in using its own name as misleading or deceptive.47 The discussion in SAP Australia is entirely in keeping with the High Court’s analysis in Campomar, affirming, amongst other things, that whether or not impugned conduct (here, the first respondent’s use of its marks in respect of its goods and services) amounted to a representation of the kind alleged is a question of fact to be determined against the relevant matrix of facts: see Campomar 202 CLR at 84; 46 IPR at 507 [100], citing Taco Co of Australia Inc v Taco Bell Pty Ltd [1982] FCA 136; (1982) 42 ALR 177 at 202. Further, as Campomar acknowledged, alleged representations to the public attract additional considerations – the initial question here being whether the misconceptions, or deceptions, alleged to arise or to be likely to arise are properly to be attributed to the ordinary or reasonable members of the classes of prospective purchasers: see Campomar 202 CLR at 86; 46 IPR at 509 [105]. In this context, in Campomar 202 CLR at 87; 46 IPR at 510 [106], the High Court approved the observation of Deane and Fitzgerald JJ in Taco Bell 42 ALR at 201, that "the question whether particular conduct causes confusion or wonderment cannot be substituted for the question whether the conduct answers the statutory description contained in s 52".
48 Lumley Life Ltd v IOOF of Victoria Friendly Society (1989) 16 IPR 316 is illustrative. In that case, Lumley Life Ltd marketed an investment product under the name "Lumley Flexibond", whilst the respondent marketed a product called "IOOF Flexi Bond". The parties’ products exhibited some similarities and some differences. A claim for misleading and deceptive conduct contrary to s 52 failed. Lockhart J said (at 323-324):
The principles of distinctiveness and secondary meaning, developed in relation to passing off, are also relevant to actions under ss 52 and 53. The proof of the existence of a misrepresentation in some form is central to all. Whether a name has acquired a secondary meaning or become distinctive of a particular producer’s product will have a direct bearing on whether the conduct in question is or is likely to mislead or deceive the relevant public. Where descriptive words are used the applicant for relief must establish that those words have become distinctively associated with his product in order to provide a basis for the relevant misrepresentation ... The applicants have failed to do this in the present case. ... There is a possibility, and some of the evidence lends support to it, that there might in the minds of some people be temporary and commercially irrelevant confusion, but nothing that constitutes misleading or deceptive conduct ...49 Thus, the authorities clearly establish that it is not enough to show misleading and deceptive conduct to show that the conduct complained of was confusing or caused people to wonder whether two products may have come from the same source: see also Parkdale 149 CLR at 198. More must be established. These additional matters depend on the circumstances of the case.
50 It must also be borne in mind that, in order to uphold an allegation of misleading and deceptive conduct, the court must be satisfied that there is a real or not remote chance that the impugned conduct is misleading or deceptive, or likely to mislead or deceive: see Global Sportsman Pty Ltd v Mirror Newspapers Ltd (1984) 6 ATPR 40-463 at 45,343, as discussed in Equity Access Pty Ltd v Westpac Banking Corporation [1989] FCA 506; (1989) 16 IPR 431 at 449, and Lumley at 324. In Lumley, Lockhart J noted that "[t]he risk must be a real risk in a practical sense and in all the circumstances". The test is essentially an objective one.
51 In this case, the primary judge was not persuaded that she should infer from the comparatively limited evidence of confusion that other people were likely to be actually misled or deceived by the first respondent’s use of its marks into acting on the basis that the first respondent’s and the appellant’s goods and services had a common source. The primary judge noted and accepted "the evidence from Mr James Helm and Mr Paul Kenna indicating that a small number of people were actually confused by the first respondent’s trade mark into believing (temporarily) that it was related to the applicant": Bing! Software [2008] FCA 1760 at [73]. Her Honour found, however, that the evidence of this misconception in the minds of the public was "minimal" and showed that any confusion was "transient and ephemeral"; and, furthermore, that the instances of initial confusion were resolved "at the point of inquiry": Bing! Software [2008] FCA 1760 at [75].
52 As I have already noted, the authorities establish that evidence of less than a few instances of confusion in the minds of members of the public is usually insufficient to make out a claim of misleading and deceptive conduct, particularly where the confusion is relatively fleeting. Her Honour further justified the instances to which she referred as commercially irrelevant on the basis that the appellant’s and the first respondent’s goods and services were "so different that an ordinary member of the public seeking services offered by one of the parties would clearly not be satisfied by services offered by the other, and would realise this very quickly".
53 In substance, the appellant’s argument on this limb of the appeal involved revisiting the primary judge’s evaluation of the primary facts. It is true, as counsel for the appellant submitted, that the primary judge expressed the view that the expert evidence of Associate Professor Alpert was supportive of a finding of deceptive similarity for the purpose of s 120(1) of the Trade Marks Act; and that her Honour noted that his opinion was, in substance, that the first respondent’s use of its marks might cause relevant confusion and wonderment about the source of the goods and services bearing these marks. It is to be borne in mind, however, that her Honour’s comments concerning Associate Professor Alpert’s evidence were worded carefully and did not go beyond noting that his evidence was supportive of the finding that she had independently made. More particularly, her statement about his evidence fell short of accepting all of his expressed opinions. In any event, the substance of Associate Professor Alpert’s opinion was that the first respondent’s use of its marks might occasion confusion and wonderment, which, as noted already, is insufficient to establish misleading and deceptive conduct. Her Honour was entitled to consider and determine whether the confusion to which Associate Professor Alpert referred was likely to be transient and commercially insignificant, having regard to the other evidence that was before her, including the evidence of Mr Helm and Mr Kenna. As she herself noted, there was only limited evidence of confusion. Bearing in mind her other findings of fact, including that the parties’ businesses were different and operated in different markets, it was plainly open to her Honour to characterise this evidence as she did, and to hold that the claim of misleading and deceptive conduct was not made out.
54 Accordingly, the appellant’s submissions on this limb of the appeal should be rejected.
SUBMISSIONS ON TRADE MARK INFRINGEMENT AND RELIEF
55 The appellant argued that the primary judge had misunderstood the nature of the relevant trade mark infringement and therefore had granted injunctive relief that was too narrow in terms. In particular, the appellant argued that her Honour had wrongly concluded that the infringement related only to the use by Bing Technologies of the mark "bing" on software and in documentary references to software: compare Bing! Software [2008] FCA 1760 at [114]. The appellant submitted that her Honour was incorrect in concluding that the first respondent might use the word "bing" to describe itself and the operation of its internet postal service without infringing the appellant’s mark; and, further, that, if "bing" did not appear on software, software agreements or computer screens accessed by the first respondent’s customers, then the first respondent would only use "bing" to describe itself and its internet postal service and not goods and services the subject of the appellant’s mark.
56 The appellant maintained that the primary judge wrongly assumed that the use by the first respondent of "bing" on its website and in advertisements (as in the Virgin Blue advertisement) was not use in relation to software for the purposes of s 120(1) of the Trade Marks Act. The appellant submitted that, if regard were had to the first respondent’s website or to the Virgin Blue advertisement, it was clear that the trade mark "bing" was being used in relation to software.
57 Accordingly, according to the appellant, her Honour erred in holding that the appellant was not entitled to injunctive relief either in the terms sought in paragraphs 1(a) and 2 of its amended application or in its preferred form as sought at the 10 December 2008 hearing. The appellant maintained that, under the Trade Marks Act, it was entitled to relief against the use by the first respondent of a mark that is substantially identical with, or deceptively similar to, its registered mark in relation to goods and services in respect of which its mark is registered, and that the injunction granted by her Honour did not adequately protect this entitlement.
58 On the hearing of the appeal, counsel for the appellant agreed that it was the appellant’s contention that there is an infringement on the first respondent’s part of its registered trade mark when the first respondent used "bing" in the course of providing the first respondent’s internet postal mail service, since it was enabled in a non-incidental way by the use of software.
59 The respondents drew attention to the findings of the primary judge (at [41]) that the businesses of the parties are "completely different". The respondents characterised the appellant’s case as an attempt "to prevent an entity, which trades in a completely separate market, from utilising the word ‘bing’ in its trading name" and notwithstanding that the entity used software referred to by a different name, ‘EasyMail’. The respondents acknowledged that this characterisation depended on the undertaking given by the first respondent in court on 11 March 2008 and the second respondent’s affidavit evidence concerning the steps taken with regard to the undertaking.
60 The respondents submitted that the finding made by the primary judge – that the first respondent’s use of software was not incidental to the provision of its internet postal service – was consistent with her finding that the first respondent did not infringe the appellant’s mark by using the word "bing" in its trading name. The primary judge was not, so the respondents argued, in error. The respondents submitted further that, in view of the fact that after 11 March 2008, the first respondent had changed the name of its software to "EasyMail", then the use of the word "Bing" "could not be regarded as use on or ‘in physical or other relation to’ the goods or services in respect of which the [appellant’s] trade mark is registered".
61 The respondents submitted that, since the primary judge was persuaded that, in complying with its undertaking, the first respondent had ceased to infringe the appellant’s trade mark (see Bing! Software [2008] FCA 1760 at [111]), then the primary judge properly granted an injunction in the terms of that undertaking.
62 In oral argument, counsel for the respondents noted that advertisement in the Virgin Blue in-flight magazine had appeared at a time when the first respondent referred to its software as "Bing", and that the steps that Mr Cranitch described in his affidavit included the removal of the word "Bing" from external marketing using the word "bing" in connection with the first respondent’s software. In effect, so the respondents submitted, the appellant was seeking to have the first respondent change its name because it used software as a non-incidental part of its business operation.
CONSIDERATION OF TRADE MARK INFRINGEMENT AND RELIEF
63 Section 20(1) of the Trade Marks Act gives the registered owner of a trade mark the exclusive rights to use the trade mark and to authorise others to use it in relation to the goods and/or services in respect of which the trade mark is registered. The registered owner has the right to obtain relief under the Trade Marks Act if the trade mark is infringed: see s 20(2). Pursuant to s 120(1), a person infringes a registered trade mark if the person uses as a trade mark a sign that is substantially identical with, or deceptively similar to, the trade mark in relation to goods or services in respect of which the trade mark is registered. Section 10 states that, for the purposes of the Trade Marks Act, a trade mark is taken to be deceptively similar to another mark "if it so nearly resembles that other trade mark that it is likely to deceive or cause confusion".
64 The question of deceptive similarity is primarily to be considered by comparing the registered mark and the mark as used by the alleged infringer: see Australian Woollen Mills Ltd v FS Walton & Co Ltd [1937] HCA 51; (1937) 58 CLR 641 at 658-659 per Dixon and McTiernan JJ. In Wingate Marketing Pty Ltd v Levi Strauss & Co (1994) 28 IPR 193 at 231, Gummow J explained that "[t]he comparison is between any normal use of the plaintiff’s mark comprised within the registration and that which the defendant actually does in the advertisements or on the goods in respect of which there is the alleged infringement, but ignoring any matter added to the allegedly infringing trade mark". The appellant does not contend that the primary judge failed to make the correct comparison, or, having made this comparison, ought to have reached a different conclusion.
65 Rather, on this limb of the appeal, the focus of the appellant’s challenge was on the scope of the relief the primary judge had given. The gist of the appellant’s complaint was that, having found that the first respondent’s use of its marks infringed the appellant’s registered mark, the terms of the injunction granted by her Honour failed adequately to protect its rights. Much of this argument depended on the proper construction and application of the words "in relation to" in ss 20 and 120 of the Trade Marks Act.
66 By virtue of s 20(1) and registration of its trade mark, the appellant was entitled to the exclusive use of the mark in relation to software, the upgrading and updating of software, and the distribution and sales of software. (Although the registration in class 9 referred to software for the legal profession and other industries and professions, the parties accepted that the limitation was meaningless and, for this reason, might be disregarded.)
67 Subsection 7(4) provides that in the Trade Marks Act:
use of a trade mark in relation to goods means use of the trade mark upon, or in physical or other relation to, the goods (including second-hand goods).Subsection 7(5) makes the same provision for "use of a trade mark in relation to services". It was part of the appellant’s argument that the primary judge had disregarded the effect of s 7(4).
68 Plainly enough, s 7(4) defines use of the trade mark as not only the application of the mark to the goods themselves, but also the application of the mark to other items relating to the goods, such as labels, advertisements, invoices or other documents relating to goods: see Shanahan’s Australian Law of Trade Marks and Passing Off at [5.1430], Pioneer Kabushiki Kaisha v Registrar of Trade Marks [1977] HCA 56; (1977) 137 CLR 670 at 686 per Aickin J, Angoves Pty Ltd v Johnson (1982) 43 ALR 349 at 359-360 per Deane J, and Brother Industries Ltd v Dynamic Supplies Pty Ltd [2007] FCA 1490; (2007) 73 IPR 507 at 521 [54] per Tamberlin J. Thus, in Thunderbird Products Corporation v Thunderbird Marine Products Pty Ltd [1974] HCA 51; (1974) 131 CLR 592 at 600, Jacobs J accepted that use of the mark in relation to the goods in question (which was a boat) was constituted by the use of the mark in relation to the goods on invoices, correspondence, shipping documents and brochures.
69 The appellant has not shown that her Honour failed to appreciate and apply s 7(4) of the Trade Marks Act. Having found that the first respondent’s software was "a product in its own right", the primary judge effectively found that the first respondent infringed the appellant’s mark by applying its marks on the software and in relation to other items relating to the software and "in respect of distributing and updating that software". This is implicit in her Honour’s reasoning that the first respondent ceased its infringing use by ceasing to use "bing" on "software, agreements pertaining to software, or computer screens with reference to software".
70 It may be that the terms of the injunction granted by her Honour were too narrow – a question that is discussed below. There is, however, no error disclosed in the primary judge’s prior reasoning. Her Honour found that the first respondent’s operation of its internet postal mail service was not covered by the appellant’s registered mark – a finding that has not been challenged. This finding was supported by her Honour’s further finding that "[t]he first respondent’s internet postal service involves considerably more than use of software – indeed key activities are printing mail in the appropriate location, folding it and posting it" – none being the subject of the appellant’s mark. Her Honour also found that once the first respondent ceased to refer to its software by reference to the word "bing" and used the name "EasyMail" on the software and in relation to items relating to the software, the infringement ceased. This followed from her Honour’s determination that the effect of the undertaking, as implemented in accordance with Mr Cranitch’s affidavit, was to end the infringement.
71 On this appeal, the appellant has sought to persuade the Court to accept a characterisation of the first respondent’s business operation that is essentially different from that of the primary judge. The appellant argued that the first respondent’s internet postal mail service was fundamentally the use of the first respondent’s software or the provision of the software. The software was, so it said, integral to the first respondent’s internet postal mail service. In support of this argument, the appellant relied on the form of a standard agreement in evidence before the primary judge. The appellant argued that the agreement showed that the first respondent’s business necessarily involved it in providing software to its customers in order that they could transfer documents to the respondent’s mailroom, where the printing, folding, enclosing in envelopes and posting occurred. The appellant also referred the Court to the first respondent’s website, which was headed by a prominent "Bing" mark and was replete with references to "bing" in connection with the first respondent’s services.
72 The path the appellant invites the Court to take should not be followed. Having heard and considered all the evidence, the primary judge made findings about the first respondent’s business operation and its use of the impugned marks. Her Honour evidently considered the evidence to which the appellant took us and accepted that, up until the first respondent gave the undertaking referred to earlier (see [20]) and implemented it as Mr Cranitch described, the first respondent’s use of its marks infringed the appellant’s registered mark. This evidence, including as to the standard form agreement and webpage, related to the period prior to the undertaking and its implementation. Her Honour correctly assessed this evidence in this light. She also assessed the effect of the undertaking, having regard to Mr Cranitch’s undisputed evidence as to its implementation and her findings concerning the first respondent’s business operation. Some of these findings involve questions of fact and degree upon which minds may reasonably differ, but the appellant has failed to demonstrate that her Honour was wrong in her assessment.
73 The primary judge accepted Mr Cranitch’s evidence that, following the undertaking, the first respondent ceased to use the word "bing" on its software or on items relating to it, whether used in documents (such as standard form agreements, software licensing agreements and manuals), on a website or otherwise and returned to using its former name "EasyMail" on and in relation to its software. Amongst other things, her Honour accepted Mr Cranitch’s evidence that he had directed staff that no external marketing was to use the word "bing" in connection with the first respondent’s software. As counsel for the respondents noted, this direction would apparently cover an advertisement of the kind that appeared in Virgin Blue’s in-flight magazine. With this in mind, her Honour observed ([at [112]) that:
The fact that the internet postal service requires customers to use a computer and, invariably, software in the course of using the computer to effect and access the [first respondent’s] service – either the first respondent’s EasyMail software or alternative methods including PDF attachments – does not mean in the circumstances following the provision of the undertaking that the first respondent’s conduct infringes the applicant’s registered trade mark.74 This conclusion was clearly open to her Honour, in light of the undertaking and her findings about the first respondent’s business and the implementation of the undertaking. Indeed, her Honour’s approach was a practical one, with which I agree.
75 The appellant’s argument that, when the first respondent uses the impugned marks in connection with its internet postal mailing service, it also uses the marks in relation to its software fails, first, because the primary judge did not find that the first respondent’s business was the provision of software. Though not properly described as incidental to this business, the first respondent’s software was a separate product, which was in future to be identified by a different mark – EasyMail. The mark "EasyMail" was to be applied to the software and to items relating to the software (such as agreements, advertisements, labels and the like). The first respondent’s adoption of the mark "EasyMail" was not merely the use by it of a second mark. Rather, the change involved the cessation of the use of the infringing mark in relation to goods and services covered by the appellant’s mark, and its replacement by an altogether different mark in relation to these goods and services.
76 Although the appellant has failed to show error in the judge’s appreciation and application of the law, there remains the question whether the injunction as granted was too narrow. Counsel for the respondents acknowledged that, before the primary judge, the respondents had accepted the appellant’s alternative form of injunction in order to avoid further dispute.
77 As has already been observed, the undertaking distinguished the first respondent’s name and internet postal mail service from the software that many of its customers used to access the service. Thus, under the undertaking, the name "bing" was no longer to be used to directly refer to the first respondent’s software in documents, websites, or otherwise, although the first respondent did not give up the use of the word "bing" in its name or with reference to its internet postal mail service. The injunction granted by the primary judge assumed that not only was this separation effective, but that the terms of the undertaking were sufficient to prevent future infringement of the appellant’s trade mark.
78 The difficulty with the undertaking was that its terms were somewhat imprecise. The intended effect of the undertaking was shown, however, in the affidavit evidence of Mr Cranitch as to its implementation. The difficulty with the injunction granted by her Honour was that, because it essentially followed the terms of the undertaking, it failed in terms to afford the appellant the clear protection to which the appellant was entitled. In order to ensure that the injunction adequately protects the appellant’s rights in its registered trade mark, a further paragraph should be added to paragraph [3] of her Honour’s orders of 10 December 2008 as follows:
d from using the word "bing":(i) upon the first respondent’s software;
(ii) in the distribution and sales of the first respondent’s software;
(iii) in the upgrading and updating of the first respondent’s software;
(iv) in or on any thing (whether in documentary, electronic or other form) relating to the first respondent’s software; and(v) in or on any thing (whether in documentary, electronic or other form) relating to the distribution, sales, upgrading or updating of the first respondent’s software.
79 Accordingly, the appellant’s submissions to the effect that the primary judge’s reasoning disclosed that her Honour erroneously failed to have regard to s 7(4) of the Trade Marks Act are rejected. For the avoidance of doubt, however, the injunction granted by her Honour should be amended as indicated.
SUBMISSIONS ON COSTS ORDER MADE BY THE PRIMARY JUDGE
80 As noted, the appellant argued that the primary judge erred in holding that the respondents were liable for only 80% of the appellant’s costs of the proceeding. The appellant referred, amongst other things, to its success on its trade mark infringement claim, to the custom of including misleading and deceptive conduct claims in litigation of this kind, the correspondence of the factual and evidentiary matrix, and the limited and late nature of the undertaking. Referring to the principles on costs apportionment referred to in such cases as Cretazzo v Lombardi (1975) 13 SASR 4, Dr Martens Australia Pty Ltd v Figgins Holdings Pty Ltd (No 2) [2000] FCA 602 and Doric Products Pty Ltd v Lockwood Security Products Pty Ltd (2002) 54 IPR 495, the appellant noted that this was not a case in which there had been success on one issue unrelated to those that had failed.
81 The respondents replied that the appellant had not made out any basis for interfering with the primary judge’s exercise of discretion in relation to costs.
CONSIDERATION OF CHALLENGE TO COSTS ORDER MADE BY THE PRIMARY JUDGE
82 The principles in this regard are well known. The making of a costs order involves the exercise of a discretionary power to which the principles in House v The King [1936] HCA 40; (1936) 55 CLR 499 at 504-505 apply. In House 55 CLR at 505, Dixon, Evatt and McTiernan JJ said:
The manner in which an appeal against an exercise of discretion should be determined is governed by established principles. It is not enough that the judges composing the appellate court consider that, if they had been in the position of the primary judge, they would have taken a different course. It must appear that some error has been made in exercising the discretion. If the judge acts upon a wrong principle, if he allows extraneous or irrelevant matters to guide or affect him, if he mistakes the facts, if he does not take into account some material consideration, then his determination should be reviewed and the appellate court may exercise its own discretion in substitution for his if it has the materials for doing so. It may not appear how the primary judge has reached the result embodied in his order, but, if upon the facts it is unreasonable or plainly unjust, the appellate court may infer that in some way there has been a failure properly to exercise the discretion which the law reposes in the court of first instance. In such a case, although the nature of the error may not be discoverable, the exercise of the discretion is reviewed on the ground that a substantial wrong has in fact occurred.83 The primary judge considered each of the matters to which the appellant referred in argument. The appellant did not argue that her Honour acted on the basis of any extraneous matter and has not shown that her Honour acted on a wrong principle. The result at which her Honour arrived was not one which is capable of being described as plainly unjust or unreasonable. The fact was that the appellant was not entirely successful, and her Honour considered that there should be some discount in the costs award to reflect this fact. Perhaps her Honour might have adopted a different course, but her Honour was not bound to do so. That minds might differ about the result is not a sufficient ground for intervention.
84 I agree with the respondents’ submission that the appellant has not made out any basis for interfering with the primary judge’s discretion. Accordingly, her Honour’s costs order should not be disturbed.
85 Save for the variation of paragraph [3] of the orders made by the primary judge on 10 December 2008, the appeal is unsuccessful. If there were nothing further, then it would appear to me that the appellant should pay the respondents’ costs of the appeal. Absent any other consideration, the variation of orders referred to in paragraph [79] above would be an insufficient reason to deprive the respondents of their costs of the appeal.
Associate:
Dated: 30
September 2009
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ON APPEAL FROM A SINGLE JUDGE OF THE FEDERAL COURT OF
AUSTRALIA
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BETWEEN:
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BING! SOFTWARE PTY LTD ACN 078 281 197
Appellant |
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AND:
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BING TECHNOLOGIES PTY LTD ACN 098 420 903
First Respondent STEVEN PATRICK CRANITCH Second Respondent |
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JUDGES:
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KENNY, GREENWOOD & LOGAN JJ
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DATE:
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30 SEPTEMBER 209
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PLACE:
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BRISBANE
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REASONS FOR JUDGMENT
GREENWOOD J:
86 I have had the benefit of reading the reasons for judgment of Kenny J. I broadly agree with those reasons and the orders proposed by her Honour but wish to add the following observations. I will seek to avoid repeating much of the background comprehensively addressed by her Honour.
87 In this appeal the appellant does not challenge the findings of fact made
by the primary judge. Rather, the appellant contends
that having regard to
those findings, the primary judge, in relation to the finding of infringement of
the appellant’s registered
trade mark, ought to have framed a remedial
injunction order in terms of a prohibition upon the first respondent (Bing
Technologies)
"using within Australia the sign BING or any sign which is
deceptively similar to the Bing Trade Mark as a sign in connection with the
distribution, sale and supply of
software" (Order 2 of the application
amended on 20 November 2007), or, alternatively, in terms of the
appellant’s
subsequently adopted "preferred wording", in these
terms:
88 On 10 December 2008, at a second hearing directed to the form of the final orders consequent upon the primary judgment, the primary judge made an order in these terms:
3. In relation to all references to software in the course of the first respondent’s business, the respondents are restrained by injunction:
a. from using the word "bing" when directly referring to software in any documentation, on websites, or otherwise;
b. from referring to software itself as "bing" or any other combination of words using the word "bing";
c. where there is a reference to software from referring to it as "bing" software, or "bing" mailroom software or any other combination of words using the name "bing".
89 That order reflected the terms of an undertaking given to the Court by the respondents, by counsel, on the second day of the trial, 11 March 2008. On 12 March 2008, Mr Cranitch, the Managing Director of Bing Technologies, filed an affidavit describing the steps taken, in effect, to implement the undertaking by abandoning use of the word Bing in documentation, websites or otherwise in referring to software, and substituting the use of the former name or mark "EasyMail" as a badge of identification of the software supplied by Bing Technologies as a part of the provision of its service described as an "internet protocol postal mail service" ([8], primary judgment).
90 The appellant describes itself as Bing! Software Pty Ltd. It commenced business in 1997. It sells software. It has a registered device trade mark [5] consisting of a rectangle prominently containing the word BING in conjunction with an exclamation mark against a black infusing background. The trade mark is registered in Class 9 "for software for the legal profession and other industries and professions not limited in any way to a specific industry or commercial sector". The parties agreed that those concluding words have the effect that the mark is registered for software unconfined to any particular industry or commercial sector; Class 35 for the service of "distribution and sales of computer software"; and Class 42 for "design of computer software; programming maintenance, upgrading and updating of computer software for the legal profession and other industries and professions not limited in any way to a specific industry or commercial sector". The primary judge found that the appellant uses the trade mark and that part of the trade mark represented by "BING!" on its software (on screen), software user guides, documentation, and software marketing material. "Bing" is an onomatopoeic word.
91 The first respondent calls itself Bing Technologies. It uses the word "Bing" extensively with varying degrees of emphasis in the course of conducting its commercial undertaking. Those uses include the depiction of the word as Bing and bing and in lower case within a rectangle set against a contrasting black or white background and, in some cases, with the addition of the words "postal mail internet speed" and a small arrow device. The images are reproduced at [10] and [11]. On 6 February 2007, Bing Technologies lodged an application for the trade mark "Bing" in Classes 9, 16, 38 and 39. The content of the goods and services falling within those applications is set out at [12].
92 The content of the internet protocol postal mail service provided by Bing Technologies was the subject of findings by the primary judge. The "nature" of the business was described by the primary judge as a service which enabled customers of Bing Technologies to route letters over the internet and cause them to be printed and posted at points close to the proposed recipient with the result that users of the service would experience faster, cheaper and more efficient letter-based communications ([8], primary judgment). The primary judge found that the first respondent’s service involved a number of component parts including the engagement by the client (user) in creating a particular letter; the provision by Bing Technologies to the user of print driver software called "mail room" which enabled a printer to print the relevant letter in a particular location; the provision of that software to the user "as a means to access the service"; and use, in the main, by clients of the service of an older version of the print driver software called "EasyMail" ([9], primary judgment). The primary judge found that Bing Technologies’ internet protocol mail service involves "key activities" of printing mail in an appropriate location, folding that mail and posting it ([112], primary judgment). The primary judge found that the first respondent’s internet protocol mail service involved "considerably more than use of software" ([112], primary judgment).
93 The primary judge found that Bing Technologies is engaged in "the provision of internet postal services" (her Honour’s emphasis) and that having regard to the manner in which that service is conducted with the majority of its clients, the service is "a software-enabled service" ([52], primary judgment - her Honour’s emphasis). Her Honour, at [52] and [53], observed:
52. ... While customers can access the first respondent’s service without specific software (an issue to which I will return later in the judgment), the first respondent provides software, bearing the trade mark "bing", to customers to allow the customers to effect the internet postal service it provides, and to access that service. I consider that this observation applies equally to:
• activities of the first respondent in assisting customers install software and deal with problems with software; and
• service updates provided by the first respondent.
[emphasis added]53. Indeed, as the evidence demonstrates, the first respondent entered detailed software licence agreements with its customers in relation to software called "bing" software. To that extent the software is considerably more than "incidental" to the operation of the first respondent’s service. It is an important aspect of the service which allows its operation.
94 Accordingly, the primary judge found that so far as the majority of the users of the service are concerned, the service is an internet, software-enabled service where the software is an important aspect of the service which allows the service to operate. Since the software, for the majority of clients of the service, facilitates the operation of the service, the primary judge described the software "aspect" of the service as "considerably more than ‘incidental’ to the operation of the first respondent’s service", yet found that the service involved "considerably more than use of software".
95 At that part of [52] quoted above, her Honour observes that customers of the service can access the service without specific software and that the facility for doing so would be the subject of further comment in her Honour’s reasons. At [61] of the primary judgment, her Honour noted that the software used by the first respondent is a "product" in its own right and the subject of an exclusive distribution agreement in favour of Bing Technologies from the copyright owner. Her Honour noted that Bing Technologies provides the software to users of the service even though "the first respondent has some clients who do not use the software, but send to the first respondent documents in the form of PDF files, word documents and publisher documents". Her Honour noted again the earlier observation at [53] although in different terms, that "the software and associated services are an important part of the first respondent’s internet postal service". [61] The primary judge found at [112] that for use of the first respondent’s internet postal service, customers are required to use a computer and invariably software, to effect access to the service which might be either the first respondent’s "EasyMail" software or "alternative methods including emailing PDF attachments".
96 Although PDF attachments might be emailed by some users of the service to a location for printing, her Honour found that for the majority of users of the service, the first respondent’s software is a sufficiently important part of the first respondent’s internet postal service that access to the first respondent’s software enables access to the service. For the majority of users, the bundle of services making up the internet protocol mail service are not able to be taken up "operationally" without access to the first respondent’s software. In this appeal, the appellant contends that the findings of the primary judge, properly understood, go so far as to establish the proposition that without access to the software a user cannot gain access to the first respondent’s service. The findings of the primary judge are said to be entirely consistent, in that regard, with the underlying software licence agreements mentioned at [53] and [61]. The appellant contends that those documents did not receive sufficient elaboration in her Honour’s reasons and a consideration of them is necessary in determining the ground of contended error that her Honour did not frame the final injunction in terms which properly give effect to remedial rights in the appellant arising out of the finding that the first respondent’s use of the word "bing" in its various manifestations gave rise to infringement of the appellant’s registered trade mark on the footing that the first respondent had used as a trade mark a sign deceptively similar to the trade mark in relation to goods, namely, software, in respect of which the appellant’s trade mark is registered.
97 The appellant contends that the degree of integration between the service provided by Bing Technologies to users and the essentiality of the enabling software is such that use of a deceptively similar sign as a trade mark in relation to the service provided by the first respondent is necessarily use of the trade mark in "other relation to" the software for the purposes of s 7(4) of the Trade Marks Act 1955 (Cth) ("the Act") and thus constitutes use of a deceptively similar trade mark in relation to goods for which the mark is registered, namely, the Class 9 registration for software, for the purposes of s 120(1) of the Act, notwithstanding that the appellant has not secured registration of its trade mark for the service provided by the first respondent of which the software is an important component part. Although the relevant provisions are well known, it is convenient to note ss 120(1), 7(4), 10, 20(1) and 20(2) of the Act which are in these terms:
120(1) A person infringes a registered trade mark if the person uses as a trade mark a sign that is substantially identical with, or deceptively similar to, the trade mark in relation to goods or services in respect of which the trade mark is registered.
7(4) In this Act:
use of a trade mark in relation to goods means use of the trade mark upon, or in physical or other relation to, the goods (including second-hand goods).
10. For the purposes of this Act, a trade mark is taken to be deceptively similar to another trade mark if it so nearly resembles that other trade mark that it is likely to deceive or cause confusion.
20(1) If a trade mark is registered, the registered owner of the trade mark has, subject to this Part, the exclusive rights:
(a) to use the trade mark; and
(b) to authorise other persons to use the trade mark;
in relation to the goods and/or services in respect of which the trade mark is registered.
(2) The registered owner of a trade mark has also the right to obtain relief under this Act if the trade mark has been infringed.
98 The appellant says that the essentiality of the software to the provision of the first respondent’s commercial service can be seen plainly from the terms and conditions of an agreement described as a "Service Application Form" entered into between Bing Technologies and a user of the service. The agreement contains a statement immediately under the heading, in these terms:
Your use of the Software and the provision of the Services are governed by the terms and conditions set out on the other side of this page and any terms set out on this page. ... [emphasis added]99 The document defines Services and Software in these terms:
Services means printing, folding, inserting into envelopes and posting Documents having a substantially similar appearance as the Document appears immediately prior to transfer. Software means the object code version of the software known as Bing including any updates provided by Bing to the Customer from time to time.100 "Bing" is defined to mean Bing Technologies and "Document" means any document including written correspondence, brochures, invoices and purchase orders. By cl 2.1 of the terms and conditions, Bing Technologies grants the customer a perpetual, non-exclusive, non-transferable licence to install and use the Software on any computers that the user owns or directly controls and by cl 2.2 the user is prohibited from granting a sub-licence. Clause 3 addresses the Services provided by Bing Technologies. Clause 3.1 provides that "the Software allows the Customer [user] to transfer documents over the internet to Bing". Clause 3.2 provides that for the term of the agreement "Bing will provide the Services in relation to Documents transferred to it by the customer". The appellant says that by cl 3.1 the user is given the necessary licence to use the software and by cl 3.2 the services related to the documents so transferred to it, are to be provided to the user.
101 The appellant says that the close structural relationship between the service and the software provided by Bing Technologies reflected in the user agreement is reinforced by Bing Technologies’ use of "Bing" in its name and, more particularly, its extensive use of "Bing" as a trade mark to identify its service in its Home page, Product Features page, Innovation page, Frequently Asked Questions page, Awards Achieved page, News page, "How It Works" page and "How Bing Saves Average" page.
102 It follows, it is said, that Bing Technologies is using a deceptively similar sign as a trade mark in "other relation" to software. It also follows, it is said, that the primary judge erred by failing to frame a final injunction in terms which restrain use of the deceptively similar mark in other relation to software so as to enjoin Bing Technologies from using the mark in any relationship with the internet protocol mail service. The respondents say that the examples noted at [101] above no longer occur having regard to the undertaking and its implementation as accepted by the primary judge and thus the examples are irrelevant. More fundamentally, the respondents say that the appellant is simply seeking to extend the statutory boundary of its exclusive right to use a registered trade mark in relation to goods or services in respect of which the trade mark is registered (s 20(1) of the Act) by seeking to prevent the first respondent from using the registered trade mark or a deceptively similar trade mark in the course of providing a service for which the trade mark is not registered by the appellant. Thus, the appellant seeks to improperly extend, it is said, the scope of the statutory monopoly.
103 The primary judge found that the service provided by the first respondent was to be characterised in a disaggregated way by treating the software component of the first respondent’s service as a "good" severable from the internet postal service. Her Honour seemed to also treat the service of distribution and updating of the software as severable from other "key activities" ([112], primary judgment) comprising the service ([57], primary judgment). Thus, the first respondent’s software is a "product" in its own right ([61], primary judgment). Her Honour found that the first respondent’s supply of software and provision of software distribution and updating services fell within the scope of the appellant’s trade mark registrations in Classes 9 and 35 ([65], primary judgment).
104 At [41], her Honour found that the first respondent’s use of the word "bing" in its various manifestations involved use of a sign as a trade mark that was deceptively similar, although not substantially identical, to the appellant’s registered trade mark. At [41], her Honour made these findings. First, the marks of the appellant and the first respondent although visually different both feature the word "bing" and the spelling and sound of that word is identical to both marks. Second, a user of either the appellant’s software or the first respondent’s service must use a computer and the electronic computer-based character of the first respondent’s service was given emphasis in an advertisement in a Virgin Blue in-flight magazine of December 2007 depicting an Australia Post mail box linked by a computer cord to a computer and a monitor with the mark "bing" prominently displayed on the monitor and in the right-hand corner of the advertisement. Third, her Honour, after referring to the Virgin Blue advertisement then found:
In this respect I consider that the average consumer with ordinary intelligence with an imperfect recollection of the applicant’s trade mark, seeing or hearing the first respondent’s mark, might be caused to wonder whether goods or services supplied pursuant to the first respondent’s mark might be sourced from the applicant. [emphasis added]105 Thus, her Honour found that the first respondent’s use of the mark might cause confusion notwithstanding the introductory finding at [41] that "the businesses of the parties are completely different"; "the parties have no customers in common"; and the parties "operate in completely different markets". The appellant places particular reliance on the Virgin Blue advertisement because it is said to demonstrate an acceptance by the primary judge central to the finding of infringement of the appellant’s trade mark of use of a deceptively similar mark by the first respondent to promote its software-enabled service rather than a severable software product. The primary judge in reaching the conclusion quoted above, had regard to the evidence of Mr Kenna who had seen the Virgin Blue advertisement and assumed that the advertisement related to the appellant’s products and that the "mailing software" emanated from the appellant. The primary judge also had regard to the evidence of Mr Helm concerning individuals who had contacted the appellant in the mistaken belief that they were contacting the first respondent. The primary judge accepted that whilst evidence of actual confusion is not decisive of the question in issue, it remains "of considerable importance".
106 The primary judge accepted that the evidence of a marketing expert, Associate Professor Alpert, "on balance" supported a finding of deceptive similarity. Associate Professor Alpert’s evidence accepted by her Honour at [41] was to the following effect. If a potential customer only saw the word "bing", he or she could be led to wonder if "it" was related to the appellant. A customer who knew the appellant’s software by reference to the trade mark BING! "could be caused to wonder whether ‘bing’ came from the same source". The word "bing" was a prominent word in the trade mark of the appellant and the first respondent. A person who had an imperfect recollection of the "Bing" trade mark in relation to any software "would be likely to be confused when they saw ‘bing’ on the computer screen in relation to the first respondent’s software". An IT person who had never seen the first respondent’s website and the branding on that site but who knew of the appellant "might be confused on seeing the first respondent’s software as displayed on a computer screen". On seeing the Virgin Blue advertisement adopting the single word "bing", a person "with knowledge of the BING! Software might be confused into thinking that BING! Software had branched into a different product range" and, finally, "consumers would experience both ‘purchase confusion’ and ‘initial consideration confusion’ in relation to the respective marks of the [appellant] and the first respondent".
107 At [42], the primary judge made reference to "this deceptive similarity" which seems to suggest that her Honour also accepted the evidence of Associate Professor Alpert as emblematic of the sources of wonderment and thus confusion arising out of the use of a deceptively similar mark by the first respondent.
108 At [75] of the primary judgment, her Honour makes findings about the nature of the confusion. Her Honour does so, plainly enough, in the context of discussing the entirely separate question of whether the conduct of the first respondent engages s 52 of the Trade Practices Act 1974 (Cth) as conduct that is misleading or deceptive or likely to mislead or deceive. However, in discussing the content and character of confusion, her Honour said this:
Assuming that it is "ordinary members" of the general public at whom the first respondent’s conduct is directed, it is clear however that evidence of misconception arising in the minds of members of the public was minimal. Such evidence of misconception as exists from the evidence of Mr Helm (primarily arising from the similarity of the domain names used by the parties), and Mr Kenna (arising from the advertisement in the Virgin Blue in-flight magazine), demonstrates that any confusion was transient and ephemeral. The evidence also indicates that, while there were a small number of instances of initial confusion, those instances were resolved at the point of inquiry. Indeed this could scarcely be otherwise – the goods and services of the applicant and the first respondent are so different that an ordinary member of the public seeking services offered by one of the parties would clearly not be satisfied by services offered by the other, and would realise this very quickly. [emphasis added]109 Having regard to the findings at [41], the findings of severability at [57] and the findings at [65] that the first respondent’s supply of software and provision of software distribution and updating services fell within the scope of the appellant’s trade mark registrations in Classes 9 and 35, the primary judge found at [65] that the first respondent had infringed the appellant’s trade mark by using a deceptively similar trade mark in relation to the supply of software and the provision of distribution and updating services, in relation to that software.
110 Lest it be thought that the supply of software or the provision of distribution and updating of software by reference to the mark "bing" was more than an incidental component of the aggregated service of the first respondent, Bing Technologies sought to "clear the decks", put anecdotally, by giving an undertaking to the Court not to use "bing" as a mark in relation to its software whether described, prior to the undertaking, as "bing software", "bing mail room software" or any other combination of words using the word "bing". That undertaking ultimately led to Order 3 of the orders of 10 December 2008 imposing a prohibition "in relation to all references to software" in the course of the first respondent’s business upon the use of the word "bing" when "directly referring" to software in documentation or websites or otherwise or when "referring" (which is presumably intended to be a reference other than a direct reference) to "software itself" no matter what combination of words might be adopted, or the use of "bing" in combination with particular software titles.
111 The first respondent contended before the primary judge and on appeal that once the undertaking was given and implemented, and particularly once the orders of 10 December 2008 were made, there could be no continuing infringement of the appellant’s trade mark because from that moment in time the first respondent was no longer using the appellant’s trade mark or a mark deceptively similar to the appellant’s trade mark in relation to goods or services in respect of which the appellant’s trade mark was and is registered.
112 In addressing the question of infringing conduct rather than the scope of the orders, the primary judge at [112] of the primary judgment said this:
If "bing" does not appear on, inter alia, software, agreements pertaining to software, or computer screens with reference to software when a customer accesses the first respondent’s service or website, I understand that the first respondent would only use "bing" to describe itself and the operation of its internet postal service. This service is not covered by the applicant’s trade mark. The fact that the internet postal service requires customers to use a computer and, invariably, software in the course of using the computer to effect and access the service ... does not mean in the circumstances following the provision of the undertaking that the first respondent’s conduct infringes the applicant’s registered trade mark.113 The primary judge concluded paragraph [112] with the finding:
The first respondent’s internet postal service involves considerably more than use of software – indeed key activities are printing mail in the appropriate location, folding it and posting it. These activities are not goods and services the subject of the applicant’s registered trade mark. [emphasis added]114 At [113], the primary judge reached this conclusion:
However if the software provided by the first respondent does not bear the mark "bing", I do not see how the applicant’s trade mark is infringed through the first respondent continuing to call itself "bing" in relation to provision of an internet postal service, which (according to Mr Cranitch’s affidavit of 12 March 2008) uses a software called "Easymail". I do not accept that the applicant has a monopoly in the use of the name "bing" as a trade mark in respect of any service, including services which are not the subject of the applicant’s registered trade mark, simply because the service requires a person using it to use any form of software. Such a proposition, in my view, takes the applicant’s statutory monopoly beyond that sanctioned by the Act. [her Honour’s emphasis]115 Apart from the injunction order, the Court on 10 December 2008 made a declaration, supported by the first respondent, that:
the use by the first respondent of the word "bing" to describe, name or refer to software utilised by it or its customers was an infringement of the applicant’s Trade Mark 836622.116 The Court made a further declaration supported by the first respondent that "the first respondent’s conduct trading under and by reference to a name which includes the word "bing" does not infringe the said trade mark".
117 The appellant contends that the degree of integration between the first respondent’s service and the essentiality of enabling software renders use of the mark "bing" by the first respondent in relation to its service, a use in relation to goods (software) and services (distribution and upgrading of software) in respect of which the mark is registered. That conclusion relies on asking whether the first respondent’s service is so bound up with the supply of software and software distribution (and upgrades) that although the content of the service involves a particular set of activities as found, a use of the mark in relation to the service is properly characterised as a use in relation to software. However, s 120(1) of the Act does not ask that question. It asks whether the use of a trade mark or, relevantly here, a deceptively similar trade mark, has occurred in relation to goods or services for which the trade mark is registered. The appellant has not registered its trade mark for the service the first respondent provides, as found. The primary judge made findings as to the content of the service. The service goes beyond the supply or distribution of software. That supply is a component part, albeit an important component part, of the service.
118 Since s 120(1) of the Act is the expression of conduct contemplated by s 20(2) of the Act which infringes the exclusive rights conferred by s 20(1) of the Act on the registered owner of the trade mark and thus determines the boundary of the statutory monopoly, the primary judge was required to ask the particular question required by the Act, that is, did the first respondent use as a trade mark, a sign that is deceptively similar to the trade mark in relation to goods or services in respect of which the trade mark is registered? The immediate answer to that question is, no. On 6 February 2007, the first respondent lodged trade mark applications for the trade mark "bing" in Classes 38 and 39 in these terms:
Class 38: Data transmission by electronic mail; electronic mail; provision of electronic mail facilities. Class 39: Forwarding of mail; franking of mail; mail forwarding.119 Whether the service provided by the first respondent is defined in part in terms of the services set out above or by reference to the findings of the primary judge or both, the appellant has not registered its trade mark in connection with such services. The appellant says that s 7(4) of the Act with respect to goods and where relevant s 7(5) in similar terms in relation to services, broadens the statutory notion of the relationship between use by the first respondent of a mark, and goods or services in respect of which the trade mark is registered. In effect, the appellant says that s 120(1) addresses use "in relation to goods or services" in respect of which the goods or services are registered, and s 7(4), in relation to goods, requires a question to be asked of whether the use is use "upon" goods, or use in "physical relation" to goods or use in "other relation" to the goods. The appellant says that in answering the last limb of that question, use of the mark on websites or advertisements in relation to a service that is software-enabled and taken up by the majority of users through distributed software that is required to be taken up in order to operate the service, is use of the mark in other relation to the goods and thus use of the trade mark "in relation to goods" for the purposes of s 120(1) by operation of s 7(4).
120 Although ss 7(4) and 7(5) identify categories of use of a trade mark that establish a relation to goods or services, that relation must, through such use, be in respect of goods or services for which the mark is registered, that is, for example, particular use in relation to goods for the purposes of s 7(4). It would be an odd result to conclude that use of the trade mark related to services not the subject of a registration is use in other relation to goods the subject of a registration. Moreover, s 7(4) has conventionally been regarded as extending use of the trade mark in relation to goods, to use of the mark upon closely related instruments or documents of trade in goods especially as a mark is used as a trade mark. Such documents include invoices, advertisements, swing tags, wrappers, brochures, letterhead and facsimile sheets. There are many authorities dealing with such related things falling within the scope of s 7(4) of the Act. Kenny J has identified some of them at [68]. I agree with Kenny J that the appellant has failed to demonstrate, for all the reasons identified by her Honour, that the primary judge was not astute to the application and operation of s 7(4) of the Act.
121 Fundamentally, the use of the trade mark "bing" by the first respondent in the post-undertaking (and post-Order 3) environment is a use of a mark in relation to the services provided by the first respondent as found rather than use in relation to software or use in "other relation" to software or software distribution services.
122 I agree with Kenny J that having regard to the findings of the primary judge, the form of Order 3 ought to have incorporated a prohibition upon use of the trade mark in relation to software and software distribution services consistent with the orthodox understanding of the reach of that phrase within s 7(4) of the Act framed in terms of the relevant conduct.
123 As to the further ground of appeal raising the question of whether the conduct of the first respondent was misleading or deceptive or likely to mislead or deceive the relevant addressees, the appellant contends that such a conclusion was "indisputable" on the evidence of Mr Kenna, the expert opinion evidence of Associate Professor Alpert and her Honour’s assessment of the Virgin Blue advertisement in the context of Mr Helm’s evidence. The question of whether a person has engaged in conduct properly characterised as use, as a trade mark, of a sign that is deceptively similar to a registered trade mark in relation to goods or services in respect of which the trade mark is registered, is an entirely separate and distinct question from whether that conduct, understood contextually, is elevated to conduct that satisfies the statutory description of conduct within s 52 of the Trade Practices Act 1974 (Cth).
124 The primary judge found that the first respondent’s use of the word "bing" in its various manifestations involved use of a sign as a trade mark that was deceptively similar to the appellant’s registered trade mark in relation to the supply of software, and the distribution and upgrading of software, in respect of which the trade mark was registered. The primary judge found that use by the first respondent of its mark might cause the average consumer with ordinary intelligence with an imperfect recollection of the appellant’s trade mark, seeing or hearing the first respondent’s mark, to wonder whether goods or services supplied pursuant to the first respondent’s mark might be sourced from the appellant. That finding arose out of a method of analysis adopted by the primary judge consistent with the method reflected in the observations of Gummow J in Wingate Marketing Pty Ltd v Levi Strauss & Co (1994) 49 FCR 89 at pp 124 to 130 and particularly at pp 128F to 130D: see also Aldi Stores Ltd Partnership v Frito-Lay Trading Co. GMBH (2002) 54 IPR 344 at [84] to [88] per Lindgren J. The degree of wonderment or confusion identified by the primary judge was described by her Honour as transient and ephemeral comprising a small number of instances of initial confusion which were resolved at the point of inquiry. The primary judge examined the contextual circumstances of confusion and observed that the goods and services of the appellant and the first respondent are so different that an ordinary member of the public seeking services offered by one of the parties would clearly not be satisfied by services offered by the other and would realise this very quickly. The finding of confusion at [41] was introduced by the contextual observation that "the businesses of the parties are completely different"; "the parties have no customers in common"; and the parties "operate in completely different markets" [41]. These evaluative findings were open on the evidence before the primary judge. As to the relationship between the trade mark law concept of confusion in the sense of wonderment as to origin or connection, and conduct meeting the statutory description within s 52 of the Trade Practices Act 1974, French J made these observations in Registrar of Trade Marks v Woolworths Ltd (1999) 45 IPR 411 at 427:
The trade mark law concept of confusion in the sense of mere wonderment as to common origin or connection has little part to play in the consumer protection statutes. That, no doubt, is because "confusion" used in that sense, does not of itself lead into error or affect choices at the point of sale. It is perhaps best described in trade mark law as effecting a prophylactic support for commercial distinctiveness.125 In Campomar v Nike International (2000) 202 CLR 45, the Court, per Gleeson CJ, Gaudron, McHugh, Gummow, Kirby, Hayne and Callinan JJ, at [94] and [95] also recognised a distinction between conduct giving rise to a state of confusion falling short of an actual probability of deception, on the one hand, and conduct which satisfies the statutory description of conduct within s 52 of the Trade Practices Act 1974, on the other. The primary judge found that although the average consumer with ordinary intelligence and an imperfect recollection of the appellant’s trade mark might be caused to wonder as to the source or origin of the goods or services supplied by reference to the first respondent’s mark, the first respondent’s conduct fell short of being misleading or deceptive or likely to mislead or deceive such a member of the public.
126 For the reasons identified by Kenny J, the conduct of the first respondent did not involve a contravention of s 52 of the Trade Practices Act 1974. I also agree, for the reasons identified by Kenny J, that the discretion of the primary judge in relation to the question of costs, did not miscarry.
127 I agree with the orders proposed by Kenny J.
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I certify that the preceding forty-two (42) numbered paragraphs are a true
copy of the Reasons for Judgment herein of the Honourable
Justice
Greenwood.
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Associate:
Dated: 30 September 2009
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IN THE FEDERAL COURT OF AUSTRALIA
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QUEENSLAND DISTRICT REGISTRY
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GENERAL DIVISION
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QUD 20 of 2009
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ON APPEAL FROM A SINGLE JUDGE OF THE FEDERAL COURT OF
AUSTRALIA
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BETWEEN:
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BING! SOFTWARE PTY LTD ACN 078 281 197
Appellant |
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AND:
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BING TECHNOLOGIES PTY LTD ACN 098 420 903
First Respondent STEVEN PATRICK CRANITCH Second Respondent |
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JUDGES:
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KENNY, GREENWOOD & LOGAN JJ
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DATE:
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30 SEPTEMBER 2009
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PLACE:
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BRISBANE
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REASONS FOR JUDGMENT
LOGAN J:
128 I agree with Kenny J.
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I certify that the preceding one (1) numbered paragraph is a true copy of
the Reasons for Judgment herein of the Honourable Justice
Logan
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Associate:
Dated: 30 September 2009
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Solicitor for the Appellant:
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Bennett & Philp
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Counsel for the Respondents:
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Mr A Crowe SC
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Solicitor for the Respondents:
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Holding Redlich
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URL: http://www.austlii.edu.au/au/cases/cth/FCAFC/2009/131.html