Bing! Software Pty Ltd v Bing Technologies Pty Limited

The primary proceedings 3 The hearing of this matter commenced on 10 March 2008 and concluded on 13 March 2008 (the primary proceedings). On 13 March 2008 at the conclusion of the hearing I reserved judgment. 4 The applicant is the registered proprietor of Trade Mark 836622 with a priority date of 24 May 2000. In the primary proceedings, the applicant, through its amended application and amended statement of claim filed 20 November 2007, alleged the respondents had: · infringed the applicant's registered trade mark; · engaged in misleading and deceptive conduct in contravention of ss 52 and 53 of the Trade Practices Act 1974; and · engaged in conduct constituting wrongful passing off. 5 The relief sought by the applicant included in summary: · orders permanently restraining the respondents from using the name or sign "bing" and trading under the name or style in connection with the word "bing" with the distribution sale and supply of software within Australia; · the delivery up for destruction of relevant marketing material; · an order that the first respondent change its name forthwith; · an order that the first respondent transfer registration of the domain name www.bing.com to the applicant; and · damages. 6 On 11 March 2008 during the primary proceedings, the first respondent gave an undertaking to the court through their counsel. The undertaking was as follows: 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!". (TS 86 ll 18-25) 7 This undertaking given by the respondents was supported by an affidavit of Mr Cranitch sworn on 12 March 2008 and filed in court on 13 March 2008 (the 12 March affidavit). The 12 March affidavit details the steps taken by the respondents to that date, as well as steps proposed to be taken by the respondents, to comply with the undertaking. The applicant did not object to the 12 March affidavit being filed, and did not seek to cross-examine Mr Cranitch in relation to evidence in the affidavit.

The notice of motion 8 On 11 April 2008 the respondents contacted my associate by email and attached letter advising of their intention to file an additional affidavit in the proceedings. The same correspondence, with the addition of a copy of the affidavit, was sent to the applicant. On 16 April 2008, the applicant addressed a letter and email to my associate outlining its objections to the filing of any further evidence. 9 On 18 April 2008 the respondents sought to file with my associate the affidavit of Steven Patrick Cranitch sworn on 9 April 2008 (the 9 April affidavit). The matter was referred to Deputy District Registrar Belcher. By letter dated 21 April 2008 to the respondents (and copied to the applicant), DDR Belcher informed the respondents that: · it was inappropriate to seek to file documents through judge's chambers; · the applicant had objected to the filing of, or reliance on, any further affidavit material following the conclusion of the trial; · any reliance on further affidavit material would require the reopening of the hearing, as it had concluded on 13 March 2008; and · the affidavit would not be accepted without the direction of a judge pursuant to O 46 r 7A(2) Federal Court Rules. 10 The respondents filed a notice of motion on 16 May 2008 seeking leave to file the 9 April affidavit. The notice of motion was set down for hearing at 10.15 am on 27 May 2008.

9 April affidavit 11 In summary, as submitted by Mr Crowe SC for the respondents, the 9 April affidavit of Mr Cranitch sets out in detail the numerous steps that have been taken to change all references in software to the word "bing", wherever they appear, on the website and in all documentation (TS 27 May 2008 p 3 ll 5-7).

Adducing further evidence-in-chief - relevant principles 12 It is not in dispute that the Court has the power to grant leave for further evidence-in-chief to be adduced after the trial of the proceeding has concluded and judgment reserved. Indeed this jurisdiction is well recognised: Murray v Figge (1974) 4 ALR 612, Gulf Pacific Pty Ltd v Londish [1992] FCA 502, Urban Transport Authority of New South Wales v Nweiser (1992) 28 NSWLR 471, Smith v New South Wales Bar Association (1992) 176 CLR 256, McCarthy v McIntyre [2000] FCA 1250, Inspector-General in Bankruptcy v Bradshaw [2006] FCA 22, Hawthorn Glen Pty Ltd v Aconex Pty Ltd (No 1) [2007] FCA 2010. 13 In Bradshaw [2006] FCA 22, Kenny J conveniently summarised the circumstances in which the Court will permit further evidence to be adduced between conclusion of the hearing and delivery of judgment as follows: [24] The authorities indicate that, broadly speaking, there are four recognised classes of case in which a court may grant leave to re-open, although these classes overlap and are not exhaustive. These four classes are (1) fresh evidence (Hughes v Hill [1937] SASR 285 at 287; Smith v New South Wales Bar Assn [No 2] (1992) 108 ALR 55 at 61-2); (2) inadvertent error (Brown v Petranker (1991) 22 NSWLR 717 at 728 (application to recall a witness); Murray v Figge (1974) 4 ALR 612 at 614 (application to tender answers to interrogatories); Henning v Lynch [1974] 2 NSWLR 254 at 259 (application to re-open); (3) mistaken apprehension of the facts (Urban Transport Authority of NSW v NWEISER (1992) 28 NSWLR 471 ("UTA") at 478; and (4) mistaken apprehension of the law (UTA at 478). In every case the overriding principle to be applied is whether the interests of justice are better served by allowing or rejecting the application for leave to re-open: see UTA at 478; also The Silver Fox Co Pty Ltd as Trustee for the Baker Family Trust v Lenard's Pty Ltd (No 2) [2004] FCA 1310 ("Silver Fox") at [22] and [25]. 14 With respect to fresh evidence, Muirhead J held in Murray v Figge 4 ALR 612 that fresh evidence should be admitted only when: (a) it is so material that the interests of justice require it; (b) the evidence if believed would most probably affect the result; (c) the evidence could not by reasonable diligence have been discovered before; (d) inadvertence was established; and (e) no prejudice was suffered by the other party by reason of its introduction at a late point of time. 15 To that list can be added: · it is necessary that the evidence sought to be adduced is relevant within the meaning of s 56 Evidence Act 1995 (Cth) and is of probative value (cf Australian Securities and Investments Commission v Rich [2006] NSWSC 826 at [18]); and · the court must be conscious of the principle of finality of litigation in deciding whether to exercise discretion to allow evidence after the conclusion of the trial (Bradshaw [2006] FCA 22 at [25]).

Submissions of the respondents 16 The submissions of the respondents in support of the notice of motion may be summarised as follows: · The evidence in the 9 April affidavit is nothing more and nothing less than completing the evidence that was tendered on behalf of the respondents on the last day of trial as to the steps taken to comply with the undertaking provided to the Court. The current application concerns a further affidavit wherein Mr Cranitch deposes to evidence of steps taken to complete the task of removing reference to "bing" in software of the first respondent, which was also the subject of the 12 March affidavit. · The purpose of the application was because, as Mr Crowe SC submitted, the respondents: anticipated and it seems to be the case that it will be said that…giving the undertaking is not enough… But what your Honour needs to be satisfied of is the fact of compliance with the undertaking and that's the reason we've put that in. It was unfinished business. The affidavit that went in, the 12 March affidavit, made it plain it was unfinished business. We're simply putting in evidence which has occurred since the end of trial or trying to put that evidence in which finishes off that aspect of the case, makes it plain we are fully complied with the undertaking and that's the relevance of it… It's about compliance with the undertaking. (TS 3 ll 44-47, TS 4 ll 1-6, 9-10) · This application falls within the class of "fresh evidence", as it is evidence which has arisen since the completion of the trial. · The evidence sought to be adduced is directly relevant to compliance with the undertaking provided to the Court on the second day of trial and the scope of injunctive relief which is appropriate to be granted should the applicant succeed. · The interests of justice are better served by allowing the application. In determining the issue of what relief (if any) is appropriate, the Court should have the relevant facts before it. · There would be no difference in principle if, for example, after the trial had ended the same undertaking had been provided in an open letter by the respondents to the applicant. · Although the applicant has stated that, should the evidence be permitted, it would require: o further discovery; o cross-examination of Mr Cranitch; o leave to amend its pleadings; and o leave to lead further evidence and make further submissions in respect of the material; the applicant has not given any reason why such steps would be necessary.

Submissions of the applicant 17 The submissions of the applicant in relation to the notice of motion may be summarised as follows: · Although the respondents allege that the application falls within the class of "fresh evidence", this is not a case of the respondents learning of fresh evidence relevant to the issues, where the evidence was not available at an earlier date. · In reality, the new evidence relates to steps taken by the respondents in an attempt to avoid allegations of trade mark infringement, in particular as relates to software and distribution of software. These have always been relevant issues in these proceedings. · It was always open to the respondents to take the steps outlined in the 9 April affidavit, however they chose not to and chose to run the case on the basis that their existing conduct did not infringe because they were not using the trade mark in relation to goods and services covered by the registration. · If the evidence in the 9 April affidavit is relevant it is relevant to an undertaking given during the trial. The obvious reason the undertaking was given was that the respondents realised during the trial that their case might not be strong in relation to the first respondent's denial that it used the trade mark in relation to software and distribution of software. · If the Court were to find for the applicant in the primary proceedings, the applicant would be entitled to an injunction notwithstanding the provision of an inadequate undertaking. Whether the conduct of the first respondent in using "bing" in relation to, for example, software and the distribution of software has ceased will need to be the subject of further investigation through discovery, cross-examination and possibly further evidence. · The applicant would be prejudiced by the admission of further evidence occasioned by the delay in the conclusion of the matter and the further costs associated with the reopening of the trial. · No explanation is offered by the respondents for why the undertaking which is the subject of the so-called further evidence was not made at an earlier date.

Consideration 18 In this case it is clear that the additional evidence the respondents wish to tender in the 9 April affidavit supplements the undertaking and the evidence in the 12 March 2008 affidavit of Mr Cranitch. It is fresh evidence, in the sense that it is evidence that was not in existence at the time of the trial, however the reasons that this fresh evidence has come into existence are: · because of the effluxion of time since the trial concluded; and · the apparent fulfilment of the steps anticipated by Mr Cranitch in his 12 March 2008 affidavit in compliance with the undertaking given in Court on 11 March 2008. 19 The applicant has submitted that it would be prejudiced by the admission of further evidence occasioned by the delay in the conclusion of the matter and the further costs associated with the reopening of the trial. The applicant has also submitted that if the 9 April affidavit were admitted it would require at the very least that further discovery be undertaken by the first respondent, cross-examination of Mr Cranitch, leave to amend its pleadings and leave to lead further evidence. I agree with the respondents that the applicant's approach is curious in light of the lack of objection to Mr Cranitch's earlier affidavit of 12 March 2008, which was similar to the 9 April affidavit in that it was also in support of the undertaking and also set out steps taken by the first respondent in compliance with that undertaking. I consider that the applicant has not substantiated its need for the additional steps it has claimed would be necessary, nor how any prejudice it would suffer from the admission of this evidence could not be compensated by a costs order. 20 There is no dispute that the evidence in the 9 April affidavit is relevant in these proceedings. However it is difficult to form any view other than that the primary reason for the 9 April affidavit is that the respondents are anxious to have on the record the continuing fact of their compliance with the undertaking as, in a sense, additional "insurance" in the event that the Court found against them and was minded to order an injunction as sought by the applicant. 21 As I have noted in my judgment in the primary proceedings (Bing! Software Pty Ltd v Bing Technologies Pty Limited (No 1) [2008] FCA 1760) an undertaking given by a party to proceedings in Court is enforceable by order of the Court pursuant to O 35 r 11 Federal Court Rules. The submission of the first respondent that it anticipates the applicant submitting that the first respondent "giving the undertaking is not enough" is: · curious in light of the power of the Court to enforce the undertaking; and · indicative of the fact that the respondents, in seeking to introduce this additional evidence, are attempting a "second bite" at the case after the trial has concluded. 22 In my view: · This is not a case where the first respondent has made a deliberate tactical decision not to adduce, during the proceedings, evidence which was already available. However the occurrence of the events the subject of the 9 April affidavit flow from a deliberate tactical decision of the first respondent during the trial to give an undertaking, the purpose of which - as the respondents admit - was to bring themselves within the principles articulated in MID Sydney Pty Ltd v Australian Tourism Co Ltd (1998) 90 FCR 236. I consider that, in principle, the distinction between: o making a deliberate tactical decision during the proceedings not to adduce evidence then available; and o making a deliberate tactical decision during the proceedings to give an undertaking from which evidence follows after the trial; is minimal in the sense that both decisions relate to the manner in which the first respondent has decided to conduct its case and the evidence to be put before the Court. In summary, it is as a result of decisions taken by the respondents, during the proceedings as to the manner in which their case was to be conducted, that the respondents now seek to put additional evidence before the Court. · I consider that allowing the respondents to supplement their case after the conclusion of the applicant's case at trial would offend the principle of finality of litigation. It is not in the interests of justice that a litigant should be entitled to adduce additional evidence after the conclusion of proceedings simply to bolster its own position, which I consider is the intention of the respondents here. · As the respondents concede, the evidence in the 9 April affidavit simply provides additional evidence that there has been compliance with the undertaking given by the first respondent in Court. I do not consider this evidence so material that the interests of justice require its admission. Further, while the evidence in the 9 April affidavit is of relevance to the primary proceedings, I consider that it would be of particular relevance in the event that the applicant subsequently claimed that the first respondent had failed to comply with that undertaking. I make this observation because I consider that the evidence goes primarily to compliance with the undertaking. · I do not consider that the additional evidence in the 9 April affidavit is evidence which, if believed, would most probably affect the result of the primary proceedings. The undertaking given by the first respondent in Court on 11 March 2008, and supported by an affidavit of Mr Cranitch, is enforceable on its own terms. · While, as I have already indicated, I consider the applicant has demonstrated little potential prejudice should I exercise my discretion to permit the respondents to adduce this additional evidence, that is not in itself a reason to exercise my discretion in the respondents' favour in light of the other factors I have taken into account. 23 Accordingly the notice of motion should be dismissed. I shall hear submissions as to costs. I certify that the preceding twenty-three (23) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Collier.

Associate: Dated: 25 November 2008 Counsel for the Applicant: Mr A Franklin SC