Grounds 1-4
58 StarTrack submitted that the learned primary judge at least mistook the significance of the facts in three critical respects.
59 First, it was submitted that the judge, in concluding that the risk that users might arrive at the ST Portal thinking they had accessed a StarTrack website, or a website associated with StarTrack, was "effectively addressed" by the pop-up ("TMA no longer has any commercial relationship with StarTrack and TMA") failed to appreciate that the pop-up appeared only after a customer, using the login details previously issued to StarTrack customers, had logged in. It was submitted that the primary judge thus erred by not considering the effect of the impugned conduct prior to any member of the relevant class of consumer seeing the pop-up.
60 Secondly, it was submitted that the primary judge did not appreciate or understand the significance of the evidence that, on TMA's own evidence, only 22.6% of people opened the TMA Promotional Email.
61 Thirdly, it was submitted that the primary judge did not refer to critical evidence that the Google search results for StarTrack packaging take the user to "hits" involving the ST Portal - that is, through what counsel called "the architecture of the internet", the inclusion of "startrack" in the StarTrack URL resulted in the user being driven to the ST Portal by searching for the StarTrack name on the Google search engine. It was submitted that his Honour thus erred in finding that there was a "very low" risk that users might arrive at the ST Portal thinking that they had accessed a StarTrack website (or a website otherwise associated in some way with StarTrack); and that he ought to have found that there was significant, not a very low, risk of that type.
62 StarTrack submitted that the primary judge was wrong to regard its prima facie case as weak. Before his Honour, StarTrack submitted that its prima facie case was a strong one. That submission was made in the context of the principles we have set out at paragraph [54] above concerning the interrelationship between the strength of an applicant's prima facie case and its position on the balance of convenience. It was only in respect of the contractual claims based on the restraint clause - with which we are not concerned - that StarTrack put its submissions on the strength of its prima facie case on the basis that the interlocutory relief it sought was tantamount to final relief, given that the restraint clause would likely have expired before trial. The conclusions we set out below concerning the strength of StarTrack's prima facie case in respect of its ACL and passing off case are to be understood in this context.
63 While StarTrack maintained that it did not need to show that its prima facie case was a strong one - although it contended that it was - it submitted that the primary judge was wrong to regard the prima facie case as weak. StarTrack contended that the primary judge ought to have found that there was a sufficiently strong prima facie case that ordinary and reasonable members of the class of persons who arrived at the ST Portal would think they have arrived at a StarTrack website or a website otherwise associated in some way with StarTrack, having regard to that evidence.
64 We consider that the primary judge did err in each of those respects. It follows that we must exercise our own discretion in substitution for his, including because he mistook the facts and did not take into account material factual considerations, in the way contended for by StarTrack.
65 In our view, his Honour's conclusion that StarTrack had established only a weak prima facie case with respect to the ACL and passing off claims is not to accepted. The prima facie case is, in our view, a strong one, for the following reasons.
66 First, the continued use of the StarTrack URL which contains StarTrack's name (and appears at the top of a user's internet browser on every page within the ST Portal) is, as the primary judge correctly said, "apt to mislead users into assuming an association that does not exist" (J at [66]). His Honour described this as StarTrack's "most persuasive angle of attack", and we would agree.
67 Secondly, Ms Arsenoulis's evidence about Google search results makes clear that users who, for example, searched for "startrack packaging" and clicked a link to the ST Portal with the StarTrack URL, would think they arrived at a StarTrack website. The primary judge did not make any reference to this evidence. In our view, such evidence means that there was a significant risk that users might arrive at the ST Portal thinking that they had accessed a StarTrack (or StarTrack-associated) website. The force of this conclusion is not undermined by the fact that, as TMA stressed, customers who had read and understood from the TMA Promotional Email that the association with StarTrack had ceased, may not be misled.
68 Thirdly, as the primary judge observed, there was an "obvious similarity" between the ST Portal as it appeared before and after 19 September 2023 (J at [55]). The screenshots set out at paragraphs [24]-[26] above show that the only material difference is that references to StarTrack and its branding have been removed from the ST Portal. Other screenshots that were in evidence showed striking similarities in their look and presentation. In such circumstances, we do not share the primary judge's view that the ST Portal had been "unambiguously rebranded" (J at [64]).
69 Nor do we accept TMA's submission (advanced by reference to Verrochi v Direct Chemist Outlet Pty Ltd (2016) 247 FCR 570) that the similarity in the look and feel, or "getup" of the ST Portal did not contribute to the misleading or deceptive character of TMA's conduct unless StarTrack proved that consumers associated that "getup" with StarTrack. The facts, and issues, in Verrocchi were very different. What the Full Court (Nicholas, Murphy and Beach JJ) recognised in Verrocchi at 580-81 [63]-[64] was that a trader can acquire a reputation for goods or services by reason of the getup used, and where the misleading or deceptive conduct arises from a competitor using the same, or a similar, getup, it will usually be necessary to establish a relevant reputation in the market associated with that getup. The short point here is the similarity in the look and feel of the ST Portal contributed to the misleading or deceptive conduct, not because that getup was distinctive in the market and associated with StarTrack, but because, in the context of other elements of the conduct (and in particular the use of the StarTrack URL), TMA harnessing the same getup contributed to the impression that customers arriving at the ST Portal were continuing to deal as they previously had. At the very least, the similarity in the getup failed to alert customers to the change.
70 Fourthly, the disclaimer contained in the pop-up, which did not appear until 10 October 2023, does not "quite effectively address" the problem, as the primary judge found (J at [65]). This is because the pop-up did not appear to a user until after they had logged into the ST Portal. By then they were already in TMA's online shop, and had been brought there by deception.
71 In Australian Competition and Consumer Commission v TPG Internet Pty Ltd (2013) 250 CLR 640, French CJ, Crennan, Bell and Keane JJ explained at 655 [50] that:
It has long been recognised that a contravention of [s 18 of the ACL] may occur … at the point where members of the target audience have been enticed into "the marketing web" by an erroneous belief engendered by an advertiser, even if the consumer may come to appreciate the true position before a transaction is concluded.
72 Because the pop-up did not appear until after the user had accessed the ST Portal, they by that point having already been drawn into the "marketing web", the pop-up does not mean that the conduct by which customers arrived at the ST Portal was not misleading or deceptive.
73 Finally, the evidence about the TMA Promotional Email was that it was only opened by 22.6% of recipients. The primary judge did not record in his reasons the limited engagement with the TMA Promotional Email. Given 77.4% of recipients did not open, and thus never saw, the TMA Promotional Email, in our view it also did not address the risk of a significant number of consumers being misled.
74 For those reasons, in our view, the evidence discloses a strong prima facie case for StarTrack's ACL and passing off claims. We take the strength of the prima facie case into account in re-exercising the discretion, having regard to the matters we address below regarding the balance of convenience.