Kosciuszko Thredbo Pty Limited v ThredboNet Marketing Pty Limited

Judgment (11 paragraphs)

[1]

The Respondents have: (a) engaged in misleading or deceptive conduct, contrary to s 18(1) of sch 2 to the Competition and Consumer Act 2010 (Cth) ('the ACL'); (b) made false or misleading representations, contrary to ss 29(1)(g) and 29(1)(h) of the ACL; by: (i) using the Universal Record Locators: a) www.thredbo.com/mythredbobooking.htm; and b) www.thredbo.com/mythredbo.htm, (ii) using the phrases 'My Thredbo', 'mythredbo', 'My Thredbo Booking' and 'mythredbobooking'; in connection with the Respondents' conduct and promotion of the business of offering for rent and renting accommodation in Thredbo in circumstances where such use was apparent to consumers.

[2]

THE COURT ORDERS THAT:

The Respondents by themselves, their officers, employees, servants and agents, be restrained from using, in connection with the Respondents' conduct and promotion of their business of offering for rent and renting accommodation in Thredbo in a way which is apparent to consumers: (a) the phrases 'My Thredbo', 'MyThredbo', 'mythredbo', 'my thredbo', 'My Thredbo booking' or 'mythredbobooking' as part of any Universal Record Locator including but not limited to: (i) ; and (ii) , (b) the phrases 'My Thredbo', 'MyThredbo', 'mythredbo', 'my thredbo', 'My Thredbo booking' or 'mythredbobooking' as part of any online content, email links or confirmation notifications, advertising or marketing material.

DECLARATIONS AND ORDERS 2 The parties have largely agreed upon a declaration and order to be made as set out immediately below. The only issue is the respondents' contention that the declaration and order should be qualified by the inclusion of the words 'in circumstances where such use was apparent to consumers' and 'in a way which is apparent to consumers' ('the contentious phrases'). The inclusion of such phrases is opposed by the applicants. For convenience, the contentious phrases are emphasised below. THE COURT DECLARES THAT:

The Respondents have: (a) engaged in misleading or deceptive conduct, contrary to s 18(1) of sch 2 to the Competition and Consumer Act 2010 (Cth) ('the ACL'); (b) made false or misleading representations, contrary to ss 29(1)(g) and 29(1)(h) of the ACL, by: (i) using the Universal Record Locators: a) www.thredbo.com/mythredbobooking.htm; and b) www.thredbo.com/mythredbo.htm, (ii) using the phrases 'My Thredbo', 'mythredbo', 'My Thredbo Booking' and 'mythredbobooking', in connection with the Respondents' conduct and promotion of the business of offering for rent and renting accommodation in Thredbo in circumstances where such use was apparent to consumers. THE COURT ORDERS THAT:
The Respondents by themselves, their officers, employees, servants and agents, be restrained from using, in connection with the Respondents' conduct and promotion of their business of offering for rent and renting accommodation in Thredbo in a way which is apparent to consumers: (a) the phrases 'My Thredbo', 'MyThredbo', 'mythredbo', 'my thredbo', 'My Thredbo booking' or 'mythredbobooking' as part of any Universal Record Locator including but not limited to: (i) www.thredbo.com/mythredbobooking.htm; and (ii) www.thredbo.com/mythredbo.htm, (b) the phrases 'My Thredbo', 'MyThredbo', 'mythredbo', 'my thredbo', 'My Thredbo booking' or 'mythredbobooking' as part of any online content, email links or confirmation notifications, advertising or marketing material. [Emphasis added] 3 Save for the Court's consideration of whether the contentious phrases should be included in any declarations or orders made, the Court finds that the proposed declaration and order are otherwise appropriate. 4 The disagreement between the parties as to the contentious phrases stems from the Court's finding in the primary judgment that the respondents' use of the words 'My Thredbo' with respect to the Genkan link is misleading or deceptive or is likely to mislead or deceive within the meaning of ss 18, 29(1)(g) and 29(1)(h) of sch 2 to the Competition and Consumer Act 2010 (Cth): see [182]-[194] of the primary judgment. 5 The applicants oppose the inclusion of the relevant contentious phrase in the proposed restraint order on the basis that it would allow the respondents to continue to use the words 'My Thredbo' or the Genkan link, albeit in a limited way; namely in metatags or metadata (hereunder referred to together as 'metatags') for the respondents' websites. Such use of metatags would be permitted given that metatags are invisible to consumers browsing the internet. 6 The applicants oppose the contentious phrase relevant to the proposed declaration for similar reasons. 7 For the contentious phrases to be excised from the proposed order and declaration, a finding is required in the primary judgment that either the invisible use of the words 'My Thredbo' or the invisible use of the Genkan link constitutes misleading or deceptive conduct. There is no such finding in the primary judgment. 8 Rather, the reasons at [187]-[190] of the primary judgment, as set out immediately below, make it patently clear that the only basis on which the Court found that the respondents had engaged in misleading and deceptive conduct was the 'visible and obvious' use of the words 'My Thredbo'. [187] Further, KT heavily relied on the fact that upon the phrase 'My Thredbo' being entered as a search term into Google at the time of hearing, the Genkan web page was returned as one of the first search results. Such Google search is displayed immediately below: [188] An analogous issue was considered by the Court of Appeal (UK) in Reed Executive plc v Reed Business Information Ltd [2004] IP & T 1049 ('Reed Executive'). The proceeding in part involved the alleged infringement of a trademark, in which the defendant used the claimant's registered trademark as a metatag for their website. It was alleged that the defendant's purpose was to ensure that when a consumer searched for the registered trademark of the claimant on Google, the defendant's website was returned as an early search result. Jacob LJ highlighted the importance of the fact that metatags are invisible to consumers on the internet, before proceeding to state at [149]: …one way of competing with another is to use his trade mark in your metatag - so that a search for him will also produce you in the search results. Some might think this unfair - but others that this is good competition provided that no one is misled. [189] Critically for the respondents in this proceeding, the Genkan link and the Genkan webpage go one step further. Rather than merely refer to 'My Thredbo' in an invisible metatag for the Genkan webpage, 'My Thredbo' is visible and obvious to consumers in the following ways: (a) In the title to the Genkan webpage, namely 'My Thredbo Accommodation Booking'; (b) In the Genkan link, both in the address bar of the browser, and on the second line of the relevant Google search result; (c) In the title of the relevant Google search result; and (d) In the description of the relevant Google search result, which also directly refers to the 'Thredbo and snowy mountains resort' [sic]. [190] It is the fact that 'My Thredbo' is visible and obvious to consumers that elevates the use of the phrase by the respondents from what Jacob LJ referred to as 'good competition' in Reed Executive at [149] to misleading or deceptive conduct. The Court considers that the use of 'My Thredbo' in relation to the respondents' accommodation services through the Genkan webpage, the Genkan link, and the resulting Google search return evinces a connection to KT's business. [Emphasis added] 9 The primary judgment does not sustain a declaration that the respondents engaged in misleading or deceptive conduct with respect to any invisible use of the words 'My Thredbo' or the Genkan link, nor does it justify the restraint of such conduct by the respondents. 10 For the reasons above, the order and declaration proposed by the parties will be entered with the inclusion of the contentious phrases as set out at [2] above.

COSTS 11 Section 43 of the Federal Court of Australia Act 1976 (Cth) invests jurisdiction in the Court to make orders in respect of costs, and s 43(2) thereof provides that an award of costs lies in the discretion of the court or Judge. The principles relating to the power of the court to award and apportion costs are summarised in Roadshow Films Pty Limited v iiNet Limited (2010) (No 4) 269 ALR 606 at [21]-[37]. Those principles need not be repeated. Ultimately, the Court is required to determine what, in the interests of justice, is the appropriate order. 12 The applicants failed in respect of each of their claims for relief, except in respect of the use of the words 'My Thredbo' in relation to the Genkan link by the respondents. But for such finding, the respondents would be entitled to an order that the whole of the costs of the proceedings be paid by the applicants. The question is whether costs should be apportioned in view of the Court's findings. 13 The applicants submit that the respondents should pay 30% of the applicants' costs in the proceedings, or in the alternative an order that each party pay its own costs. 14 The respondents seek an order that the applicants pay its costs in the proceedings up to 14 November 2012, as agreed or taxed, and that thereafter the applicants pay 95% of the costs of the proceedings from 14 November 2012 as agreed or taxed. 15 The respondents submit that such apportionment for costs would be fair in view of the fact that the applicants only succeeded in respect of the issue concerning the words 'My Thredbo' in relation to the Genkan link. The respondents assert that the use of the Genkan link was not an issue in the proceedings until the second respondent was cross-examined, that cross-examination beginning on 14 November 2012. Prior to that date it was not drawn to the attention of the respondents that the issue of the Genkan link would be relied upon as being a matter in respect of which specific relief would be sought. Accordingly, the respondents submit that they had no opportunity to consider this discrete aspect of the applicants' claims prior to the cross-examination of the second respondent, and the reliance placed upon the use of the Genkan link took them by surprise. The respondents refer to the observations of Allsop J (as he then was) in White v Overland [2001] FCA 1333 at [4] wherein his Honour referred to the need to specifically identify the issues for determination by a court. 16 The applicants respond by relying upon three sources of information which it maintains was sufficient to place the respondents on notice of the 'My Thredbo' issue, and by extension the Genkan link issue. Those sources are as follows: 1. A letter written on 15 February 2012 by Amalgamated Holdings Limited (the parent company of the applicants) in which one of the issues drawn to the second respondent's attention was the similarity between the respondents' use of 'Our Thredbo' on their websites, and the 'My Thredbo' slogan of Kosciuszko Thredbo Pty Limited. 2. The affidavits of: 2.1 Suzanne Elizabeth Diver, sworn on 30 July 2012. Such affidavit included references to 'My Thredbo' campaigns. 2.2 Michael Damien Brooks, sworn on 30 July 2012. Such affidavit included emails from the respondents to Mr Brooks with the Genkan link. 2.3 Christopher McGlynn, sworn on 31 July 2012. Such affidavit also refers to the 'My Thredbo' campaigns. 3. The Amended Fast Track Statement filed on 18 June 2012, which specifically refers to the alleged unauthorised use by the respondents of the 'My Thredbo' logo. 17 The applicants accordingly submit that the use of the 'My Thredbo' slogan was an issue in the proceedings well before 14 November 2012. 18 The Court's attention was also drawn by senior counsel for the applicants to several extracts in the transcript of the substantive hearing where reference was made to the applicants' claim for misleading or deceptive conduct in respect of 'My Thredbo' being used in website links by the respondents. This does not substantially affect the Court's consideration of the apportionment of costs given that the earliest transcript reference was on 12 November 2012, a mere two days earlier than the respondents' claim that the Genkan link issue was first raised on 14 November 2012. 19 The use of 'My Thredbo' was raised squarely as an issue in the proceedings from an early stage. The applicants made it plain, albeit very generally, that the use of the slogan 'My Thredbo' in any form was a matter in respect of which relief was claimed. There is no doubt that the Genkan link incorporated the 'My Thredbo' slogan, as was found in the primary judgment. Further, even if the respondents were taken by surprise by the cross-examination of Mr Smith on 14 November 2012, the respondents did not then make any concessions as to their use of the Genkan link. 20 However, the use of the 'My Thredbo' slogan in conjunction with the Genkan link was a discrete matter and one which was not clearly identified as a separate basis for the applicants' claim of misleading or deceptive conduct. The evidence referred to at [16] above does not contain any clear allegations as to an improper use of the Genkan link. 21 For these reasons, the Court considers that the circumstances of the proceedings require an apportionment of costs between the parties. The appropriate order is that the applicants pay the respondents 85% of the costs of the proceedings. I certify that the preceding twenty-one (21) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Cowdroy.

At a glance

Court

Decision date

Before

Catchwords

Source

Catchwords

Judgment (11 paragraphs)

Parties

Legislation Cited (2)

Cases Cited (2)

Cited By (5)