In-N-Out Burger, Inc v Rich Asians Pty Ltd [2022] FCA 1573 | Case summary

BURLEY J: 1 The applicant seeks an order pursuant to r 39.21 of the Federal Court Rules 2011 (Cth) (FCR), requiring the respondents to act in accordance with an undertaking that was given by them to the Court on 23 March 2022. It relies on two affidavits sworn by Daniella Lambert, solicitor in the employ of Baker McKenzie, one of 11 November 2022 and the other of 15 December 2022. The applicant was represented by Ms Evetts of counsel. 2 The respondents were informed of today's listing. In email exchanges annexed to the second affidavit of Ms Lambert, the second respondent, Puneet Ahori, responded to the applicant's solicitors indicating his awareness of today's listing, by saying (as original): Hi I am away I cannot attend … 3 That communication, whilst sent to the solicitors for the applicant, was not sent to the Court. No explanation has been given by Mr Ahori for his failure to attend today. The matter was called three times out of court and there was no appearance. 4 In July 2021, In-N-Out Burgers, Inc, commenced proceedings against Rich Asians Pty Ltd and Mr Ahori seeking relief arising for the alleged infringement of trade marks registered under the Trade Marks Act 1990 (Cth) owned by the applicant and also in relation to acts alleged to amount to passing off and misleading or deceptive conduct in contravention of ss 18 and 29(1)(g) of the Australian Consumer Law, being Schedule 2 to the Competition and Consumer Act 2010 (Cth). 5 The proceedings were resolved on 23 March 2022 when the parties appeared before the Court and indicated that they had reached a settlement. Mr Ahori, who is the sole director and secretary of Rich Asians, appeared on his own behalf and, with leave, on behalf of Rich Asians. 6 Mr Ahori informed the Court that he and Rich Asians gave to the Court and also the applicant the undertaking. He acknowledged that he understood the seriousness of the undertaking and the importance that he and Rich Asians comply with it. 7 The undertaking included the following: The undertaking given by each of the Respondents, to the Court and to the Applicant, that each of the Respondents: a. will, on or before 30 days after the date of these undertakings, permanently cease using each of the Aussie Burger Marks and permanently cease using the In-N-Out Logo in connection with burgers or associated food and beverages, or related restaurant and takeaway services; b. will not in future use, or direct or procure any third parties to use, the Aussie Burger Marks or the In-N-Out Logo in connection with burgers or associated food and beverages, or related restaurant and takeaway services; c. will not in future use the Registered Trade Marks, or any mark which is substantially identical or deceptively similar to the Registered Trade Marks, in relation to any Goods and Services in Australia, and in particular will not advertise, market, promote, sell or distribute, or direct or procure any third parties to advertise, market, promote, sell or distribute any Goods or Services in Australia by reference to any of the Registered Trade Marks; d. will, on or before 30 days after the date of these undertakings, remove and deliver up to the Applicant's solicitors for disposal as the Applicant thinks fit all products and materials in their possession, custody or control, including goods, signage, stationery, advertising, brochures, pamphlets, packaging, business cards, printed and electronic matter, digital media, merchandise and equipment which incorporate any of the Aussie Burger Marks or the In-N-Out Logo; and e. will take all necessary steps on or before 30 days after the date of these undertakings to: i. cancel business name registration "IN-N-OUT AUSSIE BURGERS" ii. cancel business name registration "In & out Aussie burgers"; iii. cancel or amend the account name and URL details for the "In and Out Aussie Burger" Instagram page available at https://www.instagram.com/inandoutaussieburgers/; and iv. remove, or cause the removal of, the Aussie Burger Marks and the In-N-Out Logo from all Delivery Listings, the website available at https://aussiehunger.com.au/in-out-aussie-burgers/, Instagram page available at https://www.instagram.com/inandoutaussieburgers/, and all other online listings, directories and publications operated or controlled by either of the Respondents. 8 The term Aussie Burger Marks is defined in the undertaking, and includes the word marks: In-N-Out Aussie Burgers, In N Out Aussie Burgers, In & Out Aussie Burgers, in n out, in & out and In n Out burger. The Aussie Burger Marks are also defined to include the following logo: 9 The term Delivery Listings is defined to mean all listings on online food delivery platforms which include or incorporate any of the Aussie Burger Marks, and includes specific listings as set out in an annexure to the undertaking. 10 The Registered Trade Marks of the applicant are listed in an annexure to the undertaking, and include the word mark IN-N-Out BURGER and variations of the In-N-Out Logo, which is as follows: 11 FCR 39.21 provides as follows: 39.21 Orders dealing with failure to fulfil undertakings (1) A party may apply to the Court for an order requiring a person to do, or refrain from doing, an act or thing, including payment of a sum of money, if: (a) the person (whether a party or not) has given the Court an undertaking to do, or refrain from doing, the act or thing; and (b) the person has failed to fulfil the undertaking. (2) This rule does not affect the powers of the Court to punish a person for contempt for a breach of the undertaking. 12 The evidence of Ms Lambert indicates that after giving the undertaking, Mr Ahori was supplied by email with a detailed summary of his obligations arising from it. On 4 May 2022, a further email was sent to him pointing out that he had not taken certain steps to comply with the undertaking, including to: (1) Cancel the registrations held for the business names "IN-N-OUT AUSSIE BURGERS" and "In & out Aussie burgers"; (2) Deliver up physical and electronic materials bearing the Aussie Burger Marks; (3) Remove from his Instagram account name and URL references to "In and Out Aussie Burger" and remove the Aussie Burger Marks from his Instagram profile picture and posts; and (4) Remove the Aussie Burger Marks from banners displayed in a number of Uber Eats and other online locations. 13 Ms Lambert exhibits to her affidavits various uses that exemplify the uses said to be in breach of the undertaking. She deposes to having made attempts to contact Mr Ahori in relation to these matters during May and June 2022 and also later in 2022. In July 2022, she instructed a process server to deliver a copy of a letter informing him of the offending conduct, but he has proved elusive. 14 Ms Lambert gives evidence that on 8 and 9 November 2022 she visited each of the online Delivery Listings and observed that of the 25 identified in the undertaking 17 were still available and included references to one or more of the Aussie Burger Marks. She also observed that an additional listing was available on Door Dash that the applicant was not aware of at the time of the undertaking. She retained screenshots of those listings, which she exhibited. She also instructed Trade Mark Investigation Services to place orders on some of the listings, and annexed a report from that organisation which indicated that it was able to place an order with one site. On another, the online order system was not working, but the shopfront of the store displayed the Aussie Burger Mark logo depicted at [8] above. On 14 December 2022, Ms Lambert visited the online Delivery Listings again and observed that some changes had been made to certain listings and one listing had been removed. She observed that 15 of the 25 listings appeared to remain active. 15 Ms Lambert also gave evidence that her firm has not received any products or materials from the respondents in answer to the undertaking to provide delivery up of materials bearing the Aussie Burger Marks. 16 FCR 39.21 enables a party to apply to the Court for an order requiring a person to do, or refrain from doing, an act or thing if the person has given the Court an undertaking to do, or to refrain from doing the act or thing, and the person has failed to fulfil the undertaking. In International Hair Cosmetics Group Pty Ltd v International Hair Cosmetics Ltd [2011] FCA 339; 218 FCR 398, Logan J considered the power of the Court to make orders under the predecessor to FCR 39.21, which was O 35 r 11. His Honour posed the relevant question as being whether it has been shown that the respondents have failed to fulfil the undertaking, properly construed, and, if so, whether the relief claimed should be granted: at [44]. 17 I am satisfied that Mr Ahori gave the undertaking on behalf of Rich Asians and on his own behalf. 18 The terms of the undertaking are clear. In one aspect, they require each of the respondents within 30 days of the giving of the undertaking to cease using the Aussie Burger Marks and the In-N-Out Logo in connection with burgers or associated food and beverages. In another they require delivery up of offending materials. In another they require the respondents to take steps to cancel business name registrations and social media accounts insofar as they use one or more of the Aussie Burgers marks. In yet another aspect, they require the respondents to remove the use of those marks from Delivery Listings. 19 The evidence of Ms Lambert satisfies me that the respondents have failed to fulfil the undertaking made to the Court. They have continued to use the Aussie Burger Marks and have failed to remove those marks from the Delivery Listings. The evidence indicates that the respondents have also failed to cancel the relevant business name registrations. It is unnecessary for me to catalogue further failures, which are set out in Exhibit DLM-23 to Ms Lambert's affidavit sworn on 15 December 2022. It follows that the respondents have failed and continue to fail to comply with the terms of the undertaking. Although this is not a contempt proceeding, I am satisfied that such failure is established, even taking into account the considerations set out in s 140(2) of the Evidence Act 1995 (Cth). 20 The applicant seeks a declaration that the respondents have failed to fulfil the undertaking in the aspects to which I have referred. They also seek an injunction in terms to restrain the conduct the subject of the undertaking. Having regard to the terms of these reasons, I do not consider that it is necessary for the declaratory orders to be made. Declaratory relief would be superfluous. However, I am satisfied that it is appropriate to otherwise grant orders in the terms sought in the interlocutory application. Although it is perhaps open to the applicant to seek in the injunctive order a repetition of the broader undertakings concerning future use in 1(b) and (c), the subject matter of the order is confined to narrower terms that address specific conduct of the respondents that the applicant identified is in breach of its rights. 21 I also consider that it is appropriate to order that the respondents pay the costs of the interlocutory application dated 22 November 2022 forthwith in a lump sum to be assessed by a Registrar of the Court in accordance with FCR 40.02(b). I certify that the preceding twenty-one (21) numbered paragraphs are a true copy of the Reasons for Judgment of the Honourable Justice Burley.

In-N-Out Burger, Inc v Rich Asians Pty Ltd

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