Sony Computer Entertainment Australia Pty Ltd v Saleh

Federal Court of Australia|2001-06-14|Before: Lindgren J

INTRODUCTION 1 The applicants seek relief based on alleged infringement of registered trade marks of the second applicant ("KKSCE") in respect of which the first applicant ("Sony Australia"), its Australian subsidiary, is an authorised user. KKSCE is the registered owner of registered trade mark No 642678 which is the word "PlayStation"and of registered trade mark No 642679 in respect of a device which I will not attempt to reproduce but which is a stylised representation of a vertical letter "P" and a horizontal letter "S" intertwined. I will refer to it as "PS". 2 The applicants allege that the respondent ("Mr Saleh") imported into Australia for the purpose of sale or commercial distribution seventy-nine (79) compact discs (CD-ROMs), on 29 November 2000 at Sydney International Airport, and that the registered trade marks appeared, in some cases on the disc or associated material (the "slick"), and in some cases on the monitor when the CD-ROMs were played in an appropriate machine. 3 On the hearing, Mr Saleh, who appeared in person, conceded that infringement of the trade marks had occurred by reason of what appeared on the slicks and on the monitor, but contended that he did not import the CD-ROMs at all. Rather he said he imported digital video discs (DVDs). This factual issue was the only issue in the case. 4 In addition to seeking relief for infringement of the trade marks, the applicants seek relief based on alleged breach by Mr Saleh of an undertaking which he gave previously to the applicants not to infringe the trade marks. For this reason and others, I find it convenient to summarise the background facts in chronological order.

REASONING 26 Who is to be believed - Mr Saleh or Ms Wheeler and the other ACS officers? On the hearing, Mr Saleh tendered what purported to be three "Cash Sale" receipts for payments of money. He said that these were issued to him by an unidentified seller in a Bangkok market. One of these is dated 26 November 2000 and refers to "177 PCS DVD MOVIE". Ms Dowling of counsel objected to the tender of the cash sale receipts on the basis that they were "hearsay". I admitted them into evidence subject to the objection. 27 I uphold the objection. The relevant cash sale receipt was tendered to prove a representation by the seller that Mr Saleh had paid him or her cash for what were truly 177 DVDs. Section 59 of the Evidence Act 1995 (Cth) applies. The conditions of the operation of the business records exception (cf s 69 of the Act) to the hearsay rule are not proved to have been satisfied by the respondent. 28 Even if the cash sale receipts had been ruled admissible I would not have found them persuasive. There is no testimony from the seller. Certain aspects of the documents are suspicious. For a start, it is perhaps not to be expected that an unidentified seller in a market in Bangkok would issue cash sale receipts which corresponded so precisely with the "Receipt For Goods" form issued by ACS, number 192464. The three cash sale receipts cover eight of the nine items listed on that "Receipt For Goods" form, the only missing one being a receipt for payment for the forty-five scooter handles. 29 In any event, might not the seller to Mr Saleh in Bangkok have made precisely the same error Ms Wheeler made? That is, might not the seller have erroneously described the 177 items as "DVD MOVIES" rather than CD-ROMs. After all, they look alike. 30 Mr Saleh held up in Court a slick for what he said was a DVD. He intended me to observe a difference between it and the slicks for the 79 CD-ROMs which are in evidence. But the slick which he held up appeared to be of about the same size as those in evidence. 31 I accept Ms Wheeler's testimony that on the basis of certain movie titles, she assumed that all of the items in question were DVDs and that it was only later that someone told her that the true position was otherwise. I also accept that a misunderstanding of the kind in question could easily occur in the absence of testing equipment. 32 There has been no effective challenge by Mr Saleh to the security of the system according to which the goods which were admittedly seized from him were sealed up and transmitted through the hands of the various Customs Officers resulting in 15 of the discs being tendered through Mr O'Keefe and the remaining 64 through Ms Jackson. Acceptance of Mr Saleh's testimony would involve accepting that in some unidentified way, someone in the ACS substituted the offending 79 CD-ROMs for the 79 DVDs which have gone missing. I do not accept that this occurred. 33 I accept that although there was a misdescription on the "Receipt For Goods" form, number 192464, the goods that were seized were in fact the goods which included the 79 offending CD-ROMs. 34 I infer: · that Mr Saleh was importing the 79 CD-ROMs as part of a business activity conducted by him and with the intention of selling them or otherwise dealing with them commercially; · that when he acquired them overseas and brought them by air to Australia and took steps at the Airport to bring them into the country, he was acting in the course of his business activity; · (from the number of CD-ROMs in question and his previous importations) that Mr Saleh knew that the 79 CD-ROMs bore the two trade marks; · (from Ms Jackson's evidence) that the CD-ROMs can be put to use only by means of a "PlayStation" console, that is, by means of equipment manufactured by, or with the consent of, KKSCE; · that at the time of buying the CD-ROMs overseas, bringing them by air to Sydney and attempting to import them, Mr Saleh knew this to be the case. 35 Do these findings establish that Mr Saleh infringed the two registered trade marks? 36 Subsection 120(1) of the Act provides that a person infringes a registered trade mark: "if the person uses as a trade mark a sign that is substantially identical with, or deceptively similar to, the trade mark in relation to goods or services in respect of which the trade mark is registered." The use complained of must be use "as a trade mark". The expression "use of a trade mark in relation to goods" is defined in subs 7(4) of the Act to mean "use of the trade mark upon, or in physical or other relation to, the goods (including second-hand goods)." However, the Act does not go on to define the term "use" in relation to goods. Nor does subs 120(1) require the use complained of to be "in the course of trade" (cf 62 of the Trade Marks Act 1955 (Cth)). 37 Part 13 of the Act relates to the "importation of goods infringing Australian trade marks". Section 131 of the Act states: "The object of this Part is to protect registered trade marks by making provision allowing the Customs CEO to seize and deal with goods that are imported into Australia if the importation infringes, or appears to infringe, a registered trade mark." (my emphasis) 38 Section 133 provides for the seizure of goods by the "Customs CEO": "(1) This section applies to goods manufactured outside Australia that: (a) are imported into Australia; and (b) are subject to the control of Customs within the meaning of the Customs Act 1901. (2) If goods to which this section applies: (a) have applied to them or in relation to them a sign that, in the opinion of the Customs CEO, is substantially identical with, or deceptively similar to, a notified trade mark; and (b) are goods in respect of which the notified trade mark is registered; the Customs CEO must seize the goods unless he or she is satisfied that there are no reasonable grounds for believing that the notified trade mark is infringed by the importation of the goods." (my emphasis) The expression "Customs CEO" is defined in s 6 of the Act to mean "Chief Executive Officer of Customs". 39 The above provisions contemplate that an importation may, but will not necessarily, constitute an infringement. They do not expressly make importation an element of any particular form of infringement (cf ss 37 and 38 of the Copyright Act 1968 (Cth)). Statements can be found, however, which might be thought to support the general proposition that all importations are infringements: Pioneer Kabushiki Kaisha v Registrar of Trade Marks (1977) 137 CLR 670 per Aickin J at 688; and cf Lahore, Patents, Trade marks and Related Rights (Butterworths, looseleaf at [56,120]). In my opinion, whether importation in a particular case constitutes an infringement depends on whether, in all the circumstances of the case, the importation satisfies the terms of subs 120(1) of the Act. 40 Whatever the position may be in another case of importation (for example, an isolated and "innocent" importation of a single good for private use or consumption by the importer), I find that by dealing with the CD-ROMs as described in par [34] above, Mr Saleh used the marks which were on the 79 CD-ROMs and associated slicks and which were electronically stored in those CD-ROMs, as trade marks, and therefore infringed KKSCE's "PlayStation"and "PS" trade marks. It follows that he also breached the written undertaking he gave to Sony Australia on or about 10 March 2000. CONCLUSION 41 There will be declarations and orders in the form of the short minutes of orders provided by counsel for the applicants. I certify that the preceding forty-one (41) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Lindgren.

Solicitor for the Applicant: Allen Allen & Hemsley

Trade Marks Act 1995(Cth)ss 120, 131, 133

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