Guess?, Inc v Guccio Gucci SpA

1. The respondent pay the appellant's costs of the determination of the appellant's disputed claims of legal professional privilege, heard on 9 September 2016. Note: Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules 2011.

GLEESON J: 1 On 9 September 2016, the appellant ("Guess") successfully maintained its claims of legal professional privilege over certain documents produced on discovery. It was also successful in satisfying the Court that redacted portions of certain documents contained material that is properly the subject of a claim of legal professional privilege, and that is irrelevant to this proceeding. 2 Consequently, Guess sought its costs of the argument on these matters. 3 On behalf of the respondent ("Gucci"), Mr Merrick of counsel submitted that the appropriate order was that costs be costs in the cause. Mr Merrick submitted that Gucci had a proper basis for arguing that privilege had been waived, arising out of the fact that the documents had been discovered in accordance with an order for discovery of legal files "relating to the adoption of the G-Shine trade mark" and the waiver of Guess's legal advice given in late 2007 or early 2008 as part of the clearance process for the use of the G-Shine trade mark. 4 Mr Merrick also submitted that the outcome of the hearing was, to a significant extent, informed by the Court's inspection of the documents. 5 The ordinary rule is that costs follow the event. 6 Copies of the disputed documents were provided to the Court shortly before the hearing. Because only a small number of documents were in dispute), inspection of the documents provided a practical means by which to reach the conclusion that Guess's privilege claims were properly made and the waiver did not extend to the relevant documents. 7 However, to support its claims, Guess also served a detailed affidavit of Theresa Becerril, Director and Senior Counsel for Business Transactions and Intellectual Property of Guess. Ms Becerril held the position of intellectual property counsel of Guess during the period in which the relevant documents were created. Gucci did not have evidence that cast any doubt on the facts stated in the affidavit and the mere fact that the documents were produced in answer to the particular discovery order noted above did not, without more, falsify the contents of Ms Becerril's affidavit. It is commonplace that a file relating to a particular subject matter may contain material that does not relate to that particular subject matter, depending upon the way in which the file has been constructed. 8 Ms Becerril's affidavit was not conclusive evidence of the facts stated in it but was, in my view, sufficiently detailed to demonstrate, in the absence of any evidence to the contrary, that the relevant claims of legal professional privilege were properly maintained. In the case of documents 8 and 9, the evidence was sufficiently detailed to demonstrate, in the absence of any evidence to the contrary, that the claims of legal professional privilege did not relate to the subject matter of the appeal. In the case of documents 16 to 24, the evidence was sufficiently detailed to demonstrate, in the absence of any evidence to the contrary, that the waiver of legal professional privilege did not extend to the subject documents. 9 In those circumstances, in my view, there is no reason to depart from the ordinary rule that costs should follow the event. I certify that the preceding nine (9) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Gleeson.