Injunctive Relief
7 The injunctive relief sought by the applicant is as follows:
(1) The respondent whether by its servants, agents or otherwise, permanently refrain from broadcasting or causing to be broadcast the Flickering Advertisement in Australia.
(2) The respondent whether by its servants, agents or otherwise, permanently refrain from distributing or causing to be distributed the Retailer Instructions in Australia.
(3) The Respondent whether by its servants, agents or otherwise, permanently refrain from making in Australia representations to the effect of the representations set out in paragraphs 18(b), (c), (d), and (f) and 48(a), (c), (d), and (g) of the SFASOC.
8 The respondent opposed the grant of any final injunctive relief on the ground that there is no evidence to suggest that there is any likelihood that the contravening conduct will be repeated. The respondent submitted that the contravening conduct ceased almost two years prior to the hearing of the proceeding and that there is nothing to suggest that it will be repeated now that judgment has been delivered.
9 In support of its submission the respondent referred me to a number of decisions in which judges of this Court declined to grant final injunctions under s 80 of the Trade Practices Act 1974 (Cth) (TPA) in circumstances where there was no evidence to suggest that there would be a repetition of the contravening conduct. Particular reliance was placed upon the judgments of Perram J in Luxottica Retail Australia Pty Ltd v Specsavers Pty Ltd (2010) 267 ALR 721 at [41] and Buchanan J in Unilever Australia Ltd v Goodman Fielder Consumer Foods Pty Ltd [2009] FCA 1305 at [56].
10 Section 232 of the Competition and Consumer Act 2010 (Cth) Sch 2 (Australian Consumer Law) (ACL) makes plain (as did s 80 of the TPA) that an injunction may be granted under that section whether or not it appears to the court that the person intends to engage again, or to continue to engage, in the relevant conduct: see subss 232(1) and (4) of the ACL and subss 80(1) and (4) of the TPA. In particular s 232(4) of the ACL provides:
The power of the court to grant an injunction under subsection (1) restraining a person from engaging in conduct may be exercised:
(a) whether or not it appears to the court that the person intends to engage again, or to continue to engage, in conduct of a kind referred to in that subsection; and
(b) whether or not the person has previously engaged in conduct of that kind; and
(c) whether or not there is an imminent danger of substantial damage to any other person if the person engages in conduct of that kind.
11 The Full Court's reasons in ICI Australia Operations Pty Ltd v Trade Practices Commission (1992) 38 FCR 248 (Lockhart, Gummow and French JJ) (ICI Australia) include a detailed analysis of the law relating to the grant of injunctive relief under s 80 of the TPA. As Lockhart J (with whom French J generally agreed) pointed out, subss (4) and (5) of s 80 (which correspond to subss (4) and (7) of s 232 of the ACL), were novel in that they were designed to ensure that if the condition precedent to the exercise of the power to grant injunctive relief under s 80(1) was satisfied, the Court would be given (at p 256):
… the widest possible injunctive powers, devoid of traditional constraints, though the power must be exercised judicially and sensibly.
12 Having referred to "[t]he public interest character of s 80", Lockhart J went on to point out that, notwithstanding that the provisions of subss (4) and (5) permit an injunction to be granted whether or not there appears to be any likelihood of a future contravention, the likelihood of future contravention is a relevant factor to be taken into account when deciding whether or not to grant an injunction. After referring to authority in support of that proposition, his Honour said at pp 256-257:
Injunctions are traditionally employed to restrain repetition of conduct. A statutory provision that enables an injunction to be granted to prevent the commission of conduct that has never been done before and is not likely to be done again is a statutory enlargement of traditional equitable principles. But this is because traditional doctrine surrounding the grant of injunctive relief was developed primarily for the protection of private proprietary rights. Public interest injunctions are different. Parts IV and V of the Act involve matters of high public policy. Parts IV and V relate to practices and conduct that legislatures throughout the world in different forms and to different degrees, have decided are contrary to the public interest (contracts, arrangements or understandings affecting competition adversely (s 45), the misuse of market power (s 46), the practice of exclusive dealing (s 47), resale price maintenance (s 48), price discrimination (s 49), anti-competitive mergers (s 50) and unfair practices with respect to consumers (Pt V). These are legislative enactments of matters vital to the presence of free competition and enterprise and a just society. This does not mean that the traditional equitable doctrines are irrelevant. For example, it must be relevant to consider questions of repetition of conduct or whether it has ever occurred before or whether imminent substantial damage is likely: but the absence of any one or more of these elements is not fatal to the grant of an injunction under s 80. That is the effect of subss (4) and (5) (subs (4) in relation to the prevention of conduct and subs (5) in relation to a mandatory injunction). Their presence is not an indication of a new statutory house, rather an old house with some modern extensions.
13 His Honour went on to reject a submission to the effect that the court was bound to grant an injunction in every case in which a contravention of the relevant statutory provision was proven on the basis that it was inconsistent with the statutory language including, in particular, the language of s 80(1). As to subss (4) and (5) of s 80, his Honour added at pp 257-258:
The terms of subss (4) and (5) of s 80 deny the correctness of this construction; for, taken to its logical conclusion, it would mean that once a contravention of the Act has been established an injunction must be granted, unless the court determines otherwise, notwithstanding that the defendant has not engaged in conduct of that kind before or does not intend to engage in it again.
So radical a departure from the essential nature of injunctive relief can be supported only if the language of the section plainly leads to that result or perhaps if the purpose of the provision so requires it; though legislative purpose must be gleaned essentially from the language of the provision itself in the context of the Act as a whole. The object of granting an injunction pursuant to s 80 is to restrain a person from engaging in prohibited conduct. To require, rather than permit, the court to grant an injunction once the prohibited conduct has been proved could deny the court its capacity to formulate the appropriate remedy to suit the needs of the case and could be productive of injustice. The evident intent of s 80 is to place the weapon of an injunction in the discretionary armoury of the court together with the award of damages and wide ranging orders of the kind specified in s 87.
14 Referring again to subss 80(4) and (5), Gummow J observed at p 267:
They provide that the power of the court to grant prohibitory and mandatory injunctions may be exercised in circumstances where, under the general law, there ordinarily would be a good answer to an application for injunctive relief. There may have been no previous infraction of the law, there may be no threat of any infraction or further infraction of the law, and there may be no imminent danger of substantial damage by the act or omission of the defendant.
15 The judgments in ICI Australia were referred to at length and with approval by the Full Court in Australian Competition and Consumer Commission v Dataline.Net.Au Pty Ltd (2007) 161 FCR 513 (Dataline) at [100]-[106]. The passages referred to by the Full Court included those passages in the judgments of Lockhart J and Gummow J to which I have referred.
16 In Dataline the primary judge granted injunctive relief against the respondent but not in the terms sought by the appellant. The principal question that arose in Dataline was not whether any injunctive relief was appropriate, but whether the primary judge was justified in refusing to grant the form of the injunctive relief that had been sought by the appellant. That is not the question with which I am presently concerned. Nevertheless, in the course of its judgment the Full Court said at [108], [111] and [114]:
[108] … In many, perhaps most cases, the possibility of future misconduct will be the underlying rationale for injunctive relief. In all cases the width of the relief will reflect the state of the evidence, including reasonable inferences which may be drawn from it. That is not to overlook the power to grant injunctive relief in the absence of any threatened future misconduct. Prevention of future misconduct may be the most common reason for granting injunctive relief, but there may be other reasons. The likely severity of the consequences of an improbable future breach may be an example.
…
[111] Many contraventions simply will not justify injunctive relief. We doubt whether unintentional misconduct in contravention of s 52 would lead to such relief. An isolated intentional breach may also not warrant it. Conduct which occurred many years before the enforcement proceedings may not do so, especially if the offender has not recently infringed the law, or is no longer in a position where contravention is likely. These are obvious cases, but they raise questions as to the relevant factors in considering whether to grant such relief. The discretion is at large. It is for the relevant applicant to demonstrate that the injunction will serve a purpose. That purpose may involve the protection of the public interest or private rights.
[114] The experience of the law is that unlawful or illegal conduct does not lead to an injunction against repetition of such conduct being sought or granted. A range of other remedies exist in the civil and criminal law which are treated as adequate and appropriate sanctions for such conduct. Normally, it is only where there is a real risk of further misconduct that injunctive relief is contemplated. It is, we think, no answer to this experience to say that subss (4) and (5) provide that absence of any threat of further contravention is no longer a bar to the grant of such relief. An injunction should not be seen as a necessary vindication of the applicant's conduct in bringing the proceedings. Other relief may better serve that purpose. Nor should an injunction be sought primarily for public relations purposes, however worthy such purposes may be.
17 In every case it will be for the applicant to satisfy the Court that there should be a grant of injunctive relief. The Full Court judgment in Dataline provides some illustrations of circumstances in which it may not be appropriate to grant an injunction. However, as the authorities make clear, the discretion is at large, though, as with any judicial discretion, it must be exercised judicially and for a proper purpose. As to what is a proper purpose, other authorities indicate that an injunction may be granted to mark the court's disapproval of the respondent's contravening conduct. This purpose is likely to be particularly relevant in circumstances where the contravening conduct has a public interest element: see Trade Practices Commission v Mobil Oil Australia Ltd (1984) 4 FCR 296 at 300 per Toohey J (cited by Lockhart J in ICI Australia at 255) and Australian Competition and Consumer Commission v 4WD Systems Pty Ltd (2003) 200 ALR 491. In the latter case, Selway J said at [217]:
The purpose of an appropriately drafted injunction may be merely to reinforce to the market place that the restrained behaviour is unacceptable. A declaration may achieve the same result, but so long as it is otherwise appropriate that is no reason why an injunction should not also be made if it is in the public interest (as so understood) to do so. On this basis an injunction could still be made where (as here) there was little likelihood that the respondents might engage in the restrained behaviour.
This paragraph of his Honour's reasons was referred to with approval by Black CJ and Finkelstein J in Humane Society International Inc v Kyodo Senpaku Kaisha Ltd (2006) 154 FCR 425 at [24].
18 Plainly, it would be wrong to approach the question whether there should be a grant of injunctive relief on the basis that the court should only grant such relief if it is satisfied that the respondent is likely to engage in a repetition of the contravening conduct. The absence of evidence establishing that the respondent is likely to engage in such conduct is a relevant consideration but is certainly not fatal to the claim to injunctive relief.
19 There are a number of factors which lead me to think it is appropriate to grant injunctive relief in this case.
20 First, the representation to the effect that people who watch conventional 3D television experience side effects (in particular, dizziness) was a representation which had the potential to cause the applicant's business significant harm. Moreover, the representation was one which the respondent made intentionally, and without reasonable grounds. While I accept that it was open to the respondent to argue (as it did) that this representation was not conveyed by the Flickering TVC, no such argument could be advanced by the respondent in relation to the Retailer Instructions because they contained an express representation to that effect.
21 Secondly, the respondent distributed the Retailer Instructions during March and July 2011 (Reasons [190]). It is significant that the respondent distributed the Retailer Instructions after the interlocutory hearing on 18 May 2011 at which it gave an undertaking to the Court in respect of the Flickering TVC, and at a time when it was on notice that the applicant contended that there was no reasonable basis for the "dizziness" representation or any representation to a like effect. It must have been apparent to the respondent at least by the time of that hearing that the Retailer Instructions included a serious misrepresentation as to the side effects ("dizziness and even nausea") associated with viewing conventional 3D TV. Presumably the applicant did not seek any interlocutory relief from Rares J in relation to the Retailer Instructions either because the applicant did not know of their existence until much later or because it was preoccupied with the much larger problem posed by the respondent's television campaign. In any event, the distribution of the Retailer Instructions by the respondent in July 2011 was opportunistic to say the least.
22 Thirdly, the representations conveyed by the Flickering TVC and the Retailer Instructions relate to a range of 3D televisions that employs film patterned retarder (FPR) technology, which the respondent continues to market in competition with conventional 3D TVs made by the applicant and other well-known manufacturers. Such representations were made by the respondent intentionally as part of what its parent company (LG Korea) described in the respondent's internal documents as a "generation war" between the respondent's passive 3D technology and the conventional 3D technology used by the applicant and other manufacturers.
23 The fact that I have found that the relevant representations were made intentionally, and without reasonable grounds, and that I am also satisfied that they relate to matters of continuing relevance in the market place are matters to which I give significant weight in deciding whether or not to grant injunctive relief.
24 Even if the risk of the respondent engaging in any repetition of its contravening conduct is only slight, I think it is nevertheless appropriate to grant injunctive relief. Given the seriousness of the damage that could be inflicted on the applicant (not to mention other manufacturers) if the respondent was to repeat its misleading and deceptive representations, I think it preferable that the court do what it can to eliminate that risk. Moreover, in this case the making of injunctions in appropriate terms is also a suitable means with which to mark the court's disapproval of the respondent's contravening conduct.
25 Mr Hall SC, who appeared for the respondent, criticised the form of the injunctive relief proposed by the applicant on the basis that it drew upon defined terms not incorporated in the proposed order. I agree with that criticism.
26 The injunctive relief I propose to grant is as follows:
The respondent be restrained, whether by its servants, agents or otherwise, from engaging, in trade or commerce, in any of the following conduct:
(a) representing to members of the public that many people experience dizziness or nausea when watching conventional 3D television using active shutter glasses;
(b) representing to members of the public that LG Cinema 3D TV uses technology which eliminates or reduces the risk of a viewer experiencing dizziness or nausea;
(c) representing to members of the public that the risk of people experiencing dizziness or nausea when viewing 3D television is greater in the case of conventional 3D TVs using active shutter technology than it is for LG Cinema 3D TVs using film patterned retarder (or FPR) technology;
(d) representing to members of the public that a viewer of conventional 3D TVs has to sit upright to view it in 3D; or
(e) representing to members of the public that LG Cinema 3D TVs generate a viewable image up to two times brighter than the viewable image generated by conventional 3D TVs.
27 Mr Hall SC submitted that subpara (c) reflects a case that was not argued. I do not accept that submission. Subpara (c) reflects at least one way in which the applicant's case was argued and my acceptance of that argument in my reasons for judgment (Reasons [134]).