E & J Gallo Winery v Lion Nathan Australia Pty Limited (No. 2) [2009] FCAFC 47 (15 April 2009)

Last Updated: 15 April 2009

FEDERAL COURT OF AUSTRALIA

E & J Gallo Winery v Lion Nathan Australia Pty Limited (No. 2)

[2009] FCAFC 47

Trade Marks Act 1995 (Cth) s 126

























E & J GALLO WINERY v LION NATHAN AUSTRALIA PTY LIMITED ACN 008 596 370; LION NATHAN AUSTRALIA PTY LIMITED ACN 008 596 370 v E & J GALLO WINERY
NSD 1085 of 2008

MOORE, EDMONDS AND GILMOUR JJ
15 APRIL 2009
SYDNEY

IN THE FEDERAL COURT OF AUSTRALIA
NEW SOUTH WALES DISTRICT REGISTRY	NSD 1085 of 2008

ON APPEAL FROM A SINGLE JUDGE OF THE FEDERAL COURT OF AUSTRALIA

BETWEEN:

E & J GALLO WINERY Appellant/Cross-Respondent

AND:	LION NATHAN AUSTRALIA PTY LIMITED ACN 008 596 370 Respondent/Cross-Appellant

JUDGES:	MOORE, EDMONDS AND GILMOUR JJ
DATE OF ORDER:	15 APRIL 2009
WHERE MADE:	SYDNEY

THE COURT ORDERS THAT:

1. The appeal be allowed in part.

2. Orders 1 and 2 of the orders of the primary judge of 27 June 2008 be set aside.

3. The stay against the operation of Order 3 of the orders of the primary judge of 27 June 2008 (‘Order 3’) be extended until:

(a) 28 days from the date hereof; or

(b) in the event that the appellant within that time files an application for special leave to appeal to the High Court of Australia, until determination of that application or any subsequent appeal if special leave is granted, whichever is the later;

subject to the appellant’s agreement not to seek pecuniary relief for infringement of Australian Trade Mark No. 787765 after 27 June 2008 (unless Order 3 is ultimately set aside by the High Court of Australia) and the appellant’s undertaking to pursue any such application and subsequent appeal with all due expedition.

4. The matter be remitted to the primary judge for consideration of:

(a) the appellant’s application for damages or an account of wrongful profits pursuant to s 126 of the Trade Marks Act 1995 (Cth) (as claimed in the appellant’s further amended application filed 22 February 2008 in the proceedings at first instance); and

(b) the question of costs of the amended application.

5. The operation of Order 4 be stayed for:

(a) 28 days from the date hereof; or

(b) In the event that the appellant within that time files an application for special leave to appeal to the High Court of Australia, until determination of that application or any subsequent appeal if special leave is granted, whichever is the later;

subject to the appellant’s agreement not to seek pecuniary relief for infringement of Australian Trade Mark No. 787765 after 27 June 2008 (unless Order 3 is ultimately set aside by the High Court of Australia) and the appellant’s undertaking to pursue any such application and subsequent appeal with all due expedition.

6. The appeal be otherwise dismissed.

7. The appellant pay 50% of the respondent’s costs of the appeal.

8. The cross-appeal be dismissed with costs.

Note: Settlement and entry of orders is dealt with in Order 36 of the Federal Court Rules.
The text of entered orders can be located using eSearch on the Court’s website.

IN THE FEDERAL COURT OF AUSTRALIA
NEW SOUTH WALES DISTRICT REGISTRY	NSD 1085 of 2008

ON APPEAL FROM A SINGLE JUDGE OF THE FEDERAL COURT OF AUSTRALIA

BETWEEN:

E & J GALLO WINERY Appellant/Cross-Respondent

AND:	LION NATHAN AUSTRALIA PTY LIMITED ACN 008 596 370 Respondent/Cross-Appellant

JUDGES:	MOORE, EDMONDS AND GILMOUR JJ
DATE:	15 APRIL 2009
PLACE:	SYDNEY

REASONS FOR JUDGMENT

1 We published reasons for judgment in this matter on 24 March 2009: [2009] FCAFC 27. We did not then make orders finally disposing of the appeal and cross-appeal. The parties have subsequently provided draft orders and brief written submissions in support of them. There is a large measure of agreement but two areas of disagreement. E & J Gallo Winery seeks a declaration that Lion Nathan Australia Pty Limited infringed its registered trade mark. Lion Nathan opposes the making of the declaration. Gallo wants the matter remitted to the primary judge to assess damages or, at its election, the taking of any account of profits. Again this is resisted by Lion Nathan.

2 Generally, we prefer the approach advocated by Lion Nathan. We accept, as Gallo submitted, that it sought declaratory relief in the appeal and, accordingly, it is appropriate for us to determine whether such an order should be made. However, for the reasons advanced by Lion Nathan, we have concluded it is inappropriate, as a matter of discretion, to make such a declaration. In our reasons (at [79]), we concluded that Lion Nathan has infringed Gallo’s trade mark. No utility would be served, as we see it, in making a declaration of infringement in light of this finding. Indeed, any declaration which was made would have to be expressed with some precision as to when the infringement commenced. In our reasons we noted (at [2]) that Lion Nathan commenced selling its Radler beer in January 2008. No finding of greater precision was made by the trial judge in his judgment (at [17]). More precision would almost certainly be necessary. At the very least, it is impracticable for us to engage in further fact-finding. We refuse to make the declaration sought.

3 We accept, as Lion Nathan submitted, that the order remitting the matter should not be expressed in terms which pre-suppose damages will be ordered (or an account of profits taken). Whether damages should be ordered in exercise of the power conferred by s 126 of the Trade Marks Act 1995 (Cth) is said by Lion Nathan to be a discretionary matter. Whether this is so was not an issue raised in the appeal. We have not sought to investigate the question ourselves, although cases such as Commissioner of State Revenue (Vic) v Royal Insurance Australia Ltd [1994] HCA 61; (1994) 182 CLR 51 at 84-85 may be relevant. In our view, the preferable course is to remit the matter on the terms proposed by Lion Nathan and the question of whether there is a discretion and, if so, how it should be exercised can be determined by the primary judge.

I certify that the preceding three (3) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justices Moore, Edmonds and Gilmour.

Associate:

Dated: 15 April 2009

Counsel for the Appellant/Cross-Respondent:	I M Jackman SC with M J Darke
Solicitor for the Appellant/Cross-Respondent:	Corrs Chambers Westgarth
Counsel for the Respondent/Cross-Appellant:	A J L Bannon SC with N R Murray and J M Beaumont
Solicitor for the Respondent/Cross-Appellant:	Mallesons Stephen Jaques

Date of Submissions:	2 April 2009
Date of Judgment:	15 April 2009