Taylor v Killer Queen, LLC

should leave be granted to file the proposed further amended defence? 9 The Proposed Further Amended Defence includes amendments at paras 10, 11 and 19. In the course of oral argument Ms Taylor withdrew her opposition to the proposed amendment to para 19 leaving the proposed amendments to paras 10 and 11 in issue. However, it is fair to say that the proposed amendment to para 10, which concerns the withdrawal of an admission, is the most controversial and was the focus of the parties' submissions.

The pleadings 10 It is convenient first to set out the relevant parts of the FASOC and the Amended Defence and the proposed amendments included in the Proposed Further Amended Defence. 11 The claim of trade mark infringement commences at para 7 of the FASOC. Relevantly, paras 7 to 11 provide: 7. From at least 24 October 2013 one of (sic) more of the Respondents have, or one of more of the Respondents have jointly, done one or more of the following acts (the Accused Acts): imported for sale, distributed, advertised, promoted, marketed, offered for sale, supplied, sold and/or manufactured, in Australia or to people in Australia, the Registered Goods or goods of the same description, bearing or in association with marks including but not limited to the following, in various colours: (Each, an Infringing Mark, and, in any combination or collectively, the Infringing Marks) Particulars aa. That the Accused Acts were carried out by the Respondents jointly is established from at least the following matters: i. the Second Respondent has at all times been the sole manager or member of the First Respondent and the CEO, CFO, secretary and director of the Third Respondent, and is the controlling mind of the First Respondent and Third Respondent; i2. The First Respondent is a member of the Fourth Respondent; ii. the Second Respondent personally advertises, promotes and/or markets the goods and services of the Respondents by way of: 1. appearances in person at product launches and in stores; 2. referring to such goods and services on social media and other websites (such as on Myspace, blogs, Twitter, Facebook and Instagram); and 3. referring to such goods and services by way of interviews and commentary in the news and media; and iii. the Second Respondent has claimed to be personally involved in the design of the goods referred to in paragraph 7; and iv. the Second Respondent reserves, and has a practice of exercising, a personal contractual right of final approval regarding the form and manner of the use of the Infringing Marks on goods. a. The Second Respondent has performed around 37 concerts in Australia between 24 October 2013 and the date of the Further Amended Statement of Claim, as further particularised in Schedule A. For the purposes of, or at, each of those concerts, the Respondents, jointly or severally, have engaged in one or more of the Accused Acts. ba. Further, or in the alternative, the Respondents have, jointly or severally, since 24 October 2013, engaged in one or more of the Accused Acts through temporary "pop up" stores in at least Sydney and Melbourne (the Pop Up Stores). b. Further, or in the alternative, the Respondents have, jointly or severally, since 24 October 2013, and continue to, engage in one or more of the Accused Acts including through at least the following websites: i. www.katyperry.shop.bravadousa.com; ii. katyperry.shop.musictoday.com/store; iii. www.merchbar.com/pop/katy-perry; iv. www.katyperrycollections.com; and v. www.katyperry.com, (together, the Named Websites). c. Further, or in the alternative, the Respondents have, jointly or severally, engaged in one or more of the Accused Acts through at least the following retailers: i. Target Australia Pty Ltd and/or its related entities, through its/their physical stores, and online stores at ; and ii. Myer Pty Ltd and/or its related entities, through its/their physical stores, and online stores at , (together, the Department Stores). d. Further, or in the alternative, the Respondents have, jointly or severally, authorised third parties to engage in one or more of the Accused Acts through websites including: i. the Named Websites; ii. www.shopstyle.com.au; iii. www.catch.com.au; iv. ww.ebay.com.au; v. www.amazon.com.au; vi. www.yoox.com/au; vii. www.stylicy.com/au; viii. www.shop.nordstrom.com; ix. www.lordandtaylor.com; x. www.ebay.com; xi. www.gilt.com; xii. www.amazon.com; xiii. www.macys.com; and xiv. www.amazon.co.uk. e. Further particulars may be provided following discovery, evidence and other interlocutory processes of the Court. 8. Further, or in the alternative, one or more of the Respondents individually, or one or more of the Respondents, jointly: a. was or were a party to; or b. further or alternatively aided, counselled, directed or joined in; and c. thereby participated in a common design; and/or d. further or alternatively, participated in a common design, with the operators of the: e. Pop Up Stores (if not the First or Second Respondents); f. Named Websites; g. Department Stores; h. other websites listed particulars d.vi. to d.xviii. to paragraph 7, to carry out the Accused Acts. Particulars a. The Applicant repeats the particulars of paragraph 7. b. The following particulars are the particulars of the matters alleged in paragraphs 8.a. to 8.d. c. Given the Second Respondent's occupation as an entertainer and singer, it should be inferred that the Respondents have at all relevant times sought to, and have, exercised close control over, the circumstances and manner in which the name KATY PERRY and the Second Respondent's likeness has been used by third parties in respect of goods and services, including the goods referred to in paragraph 7. d. The Respondents have a practice of entering into partnerships or arrangements with retailers for the purposes of promoting the goods and services of the Respondents, such as the partnership and sponsorship arrangement with Myer in 2017. By way of such partnerships, Respondents are aware of, and exercise close control over, the circumstances and manner in which the name KATY PERRY and the Second Respondent's likeness has been used by those retailers in respect of goods, including the goods referred to in paragraph 7. e. The Applicant repeats the particulars in paragraph 7aa above. f. Given particulars a to e, it should be inferred that the Respondents were and are aware of, and intended and intend that, one or more of the Accused Acts have been or will be undertaken in relation to the goods referred to in paragraph 7 through the retailers referred to in the particulars to paragraph 7, and took active steps to bring about such an outcome, including those steps referred to in particulars d and e. g. Further particulars may be provided following discovery, evidence and other interlocutory processes of the Court. 9A. By reason of the matters pleaded in paragraphs 7 and 8, the Respondents are each a joint tortfeasor in the doing of the acts pleaded in paragraphs 8.a. to 8.d., with the persons referred to in paragraphs 8.e. to 8.h, and each other. 9. Each of the Infringing Marks is substantially identical with, or deceptively similar to, the Applicant's Mark. Particulars a. By letters dated 21 May 2009 and 15 June 2009 sent by the Second Respondent's then trade mark attorneys, Fisher Adams Kelly (regarding the first letter) and later solicitors, Holding Redlich Lawyers (regarding the second letter), to the Applicant, the Second Respondent, in threatening litigation against the Applicant, accepted that "KATY PERRY" and the Applicant's Mark are: i. identical in sound; ii. substantially identical by sight; and iii. likely to confuse consumers and lead consumers to believe there is an association between such signs. b. Further particulars may be provided following discovery, evidence and other interlocutory processes of the Court. 10. The conduct referred to in paragraph 7 and/or 8 constituted use of the Infringing Marks as trade marks in respect of the Registered Goods and further or in the alternative, in respect of goods of the same description. 11. By reason of the matters pleaded in paragraphs 7 and 9 to 10 above, or further or in the alternative, by reason of the matters pleaded in paragraphs 7 to 10 above, the Respondents have infringed the Applicant's Mark pursuant to s 120(1) and (2) of the Act. (Underlining and strike out omitted.) 12 In their Amended Defence the respondents plead at paras 7 to 11 that: 7. In answer to paragraph 7 of the Statement of Claim, the Respondents: (a) say that: (i) prior to the First Respondent's establishment, the Second Respondent; and (ii) after its establishment in August 2009, the First Respondent, has provided to various persons from time to time licences of the KATY PERRY name, brand and trade mark on commercial terms including that provide for control of the quality of goods the subject of such licences, by the relevant Respondent; (a1) say that from time to time since their establishment on 23 April 2008 and 7 September 2016 respectively, the Third and Fourth Respondents have provided to various persons from time to time licences of the KATY PERRY name, brand and trade mark on commercial terms including that provide for control of the quality of goods the subject of such licences, by the relevant Respondent; (b) say that pursuant to the licences referred to in subparagraphs (a) and (a1) herein, various merchandise, including clothing, bearing the name, brand and trade mark KATY PERRY, in various colours and forms of stylisation, has been offered for sale, supplied and sold by persons including retailers to persons resident in Australia, including by way of online sales; and (c) otherwise deny the allegations in the paragraph. 8. In answer to paragraph 8 of the Statement of Claim, the Respondents: (a) repeat paragraphs 7(a), (a1) and (b) herein; and (b) otherwise deny the allegations in the paragraph. 9A. The Respondents deny paragraph 9A of the Statement of Claim. 9. In answer to paragraph 9 of the Statement of Claim, the Respondents: (a) admit that the trade mark KATY PERRY and each of the stylised trade mark representations appearing in paragraph 7 of the Statement of Claim is deceptively similar to the Applicant's Mark; and (b) otherwise deny the allegations in the paragraph. 10. In answer to paragraph 10 of the Statement of Claim, the Respondents: (a) repeat paragraphs 7(a), (a1) and (b) herein; (b) admit, in relation to the merchandise referred to in paragraph 7(b) herein, that the name "Katy Perry" is used as a trade mark in relation to such merchandise by or under the control of the Respondents (or one of them); and (c) otherwise deny the allegations in the paragraph. 11. The Respondents deny the allegations in paragraph 11 of the Statement of Claim and: (0) say further that the Respondents' conduct in relation to "goods of the same description" as clothes does not infringe the Applicant's Mark under section 120(2) of the Trade Marks Act 1995 (the TM Act) because, in the case of such goods, the Respondents' use of any sign is not likely to deceive or cause confusion, ... (a) say further that, by operation of section 122(1)(a)(i) of the TM Act, the Second Respondent's conduct does not infringe the Applicant's Mark because the Second Respondent uses in good faith the Second Respondent's name; ... (b) say further that, by operation of section 122(1)(a)(ii) of the TM Act, the First Respondent's, Third Respondent's and Fourth Respondent's conduct does not infringe the Applicant's Mark because the First ‍Respondent, Third Respondent and Fourth Respondent use in good faith the name of the Second Respondent, the predecessor in business of the First Respondent, Third Respondent and Fourth Respondent; … (c) say further that, by operation of section 122(1)(fa) of the TM Act, the Respondents' conduct does not infringe the Applicant's Mark because: (i) the Respondents use the trade mark KATY PERRY; and (ii) any of the Respondents would obtain registration of the trade mark KATY PERRY in their own name if they were to apply for it: Particulars … (d) say further that, by operation of section 124 of the TM Act, the Respondents' conduct does not infringe the Applicant's Mark because the Respondents have continuously used in the course of trade the trade mark KATY PERRY in relation to clothes or goods similar to clothes from a time before: (i) the date of registration of the Applicant's Mark; or (ii) in the alternative, if, which is not admitted, the Applicant used the Applicant's Mark before the date of registration, the date of any such use; (e) say further that the Applicant's Mark is liable to cancellation from the Register of Trade Marks as alleged in the Cross-claim. (Underlining and strike out omitted.) 13 In the Proposed Further Amended Defence: (1) para 10 has been amended as follows: In answer to paragraph 10 of the Statement of Claim, the Respondents: (a) repeat paragraphs 7(a), (a1) and (b) herein; (b) admit say, in relation to the merchandise referred to in paragraph 7(b) herein, that the name "Katy Perry" is used as a trade mark in relation to such merchandise by certain of the licensees referred to in paras 7(a) and 7(a1) or under the control of one or more of the Respondents (or one of them); and (c) otherwise deny the allegations in the paragraph. (2) para 11 has been amended to include a new sub para (d1) as follows: The Respondents deny the allegations in paragraph 11 of the Statement of Claim and: … (d1) say further that, insofar as the Respondents are alleged to be joint tortfeasors with the operators referred to in paragraph 8 of the Statement of Claim, the said operators are entitled to the benefit of the defences afforded by sections 122(1) and 124 of the TM Act and thus have not infringed the Applicant's Mark; (Underlining and strike out in original.)

Evidence 14 The respondents rely on the evidence of Odette Margaret Gourley, a partner of Corrs Chambers Westgarth and the solicitor on the record for them. Ms Gourley gave evidence as to why the respondents seek to amend their defence, with particular focus on the amendment to para 10. Ms Taylor relies on the evidence of Robert Anthony Silberstein, the principal of Silberstein & Associates Pty Ltd and her solicitor. Dr Silberstein gave evidence about the steps taken in preparation of the matter in reliance on his understanding of the Amended Defence and the prejudice to Ms Taylor should leave be granted to file the Proposed Further Amended Defence. 15 In order to understand the position taken by the parties it is necessary first to refer to the relevant correspondence that passed between them. 16 Commencing in January 2020 Ms Taylor sought clarification of the defence filed by Killer Queen and Ms Hudson. By letter dated 9 January 2020 Silberstein & Associates inquired about the effect of paras 7(a)(i) and (ii) and para 11 of the defence. In relation to para 11 an inquiry was made in the following terms: Is the denial in paragraph 11predicated upon the matters in sub paragraphs (a)-(e) only? Or is there some other basis for the denial? That is, do your clients accept that if they do not make out their defences, and our client's mark is not cancelled, they would infringe our client's mark? If there is some other basis for the denial, what is it? Silberstein & Associates then raised some further specific queries in relation to the defence based on s 122 of the TM Act pleaded in para 11. 17 On 11 February 2020 Corrs provided a response to the letter referred to in the preceding paragraph. In answer to the specific query concerning para 11 of the defence they wrote: This is not a proper request for particulars and the pleading in paragraph 11 of the Defence should be taken as it stands. It is for your client to plead and prove the cause of action on which it relies. For the avoidance of doubt, our clients' denial of paragraph 11 does not operate in the limited fashion described in your letter. That is, our clients do not accept that the allegations in paragraph 11 of the Statement of Claim are made out, subject only to any of the defences referred to in subparagraphs (a) to (e) of the Defence being proven. 18 By letter dated 13 February 2020 Silberstein & Associates again sought clarification of Killer ‍Queen and Ms Hudson's defence. In relation to para 11 that letter included: Given your clarification regarding the denial in paragraph 11of your clients' Defence, please provide a response to the query in the final sentence of paragraph 2 of our 9 January 2020 letter. Namely, given that you have clarified that your clients' denial is not limited to the defences pleaded and the cross-claim seeking invalidation of the mark, on what grounds is the denial asserted? In particular: a. by paragraphs 7(a) and (b) of the Defence your clients have admitted that they have provided licences to various persons to use the mark KATY PERRY on goods falling within the scope of the registered goods in circumstances where those third parties would be authorised users of the KATY PERRY mark, within the meaning of s 8 of the Trade Mark Act 1995 (Cth) (the Act); b. by those same paragraphs your clients admit those goods have been offered for sale, sold and supplied to persons in Australia; c. by paragraph 9 your clients admit that KATY PERRY is deceptively similar to our client's mark; and d. by paragraph 10 your clients admit that the use of KATY PERRY as admitted was use as a trade mark. Therefore, based on your clients' admissions in their Defence, they must admit to at least some degree of infringement of our client's mark pursuant to either s 120(1) or (2) of the Act, subject only to a particular defence or defences being made out, and a blanket denial is inappropriate. Accordingly, we invite your clients to elucidate the basis of that denial. 19 In response, by letter dated 17 February 2020 (17 February 2020 Letter), Corrs said under the heading "Paragraph 11 of the Defence" that: Our clients accept that, to defeat your client's infringement claim, they need to make good one of the statutory defences pleaded in subparagraphs 11(a) to (d) of the Defence and/or to succeed on the cross-claim. 20 As set out above, on 10 March 2021 the respondents filed the Amended Defence. No amendment was made to paras 7 to 10 and para 11 was amended by the addition of subpara (0) (see [12] above). 21 The Proposed Further Amended Defence was first provided to Ms Taylor under cover of a letter dated 15 July 2021 from Corrs to Silberstein & Associates. In that letter Corrs sought to explain the proposed amendments to paras 10 and 11. Their letter relevantly included: Paragraph 10(b) The amendment to paragraph 10(b) is made in light of the decision of Markovic J in PDP Capital Pty Ltd v Grasshopper Ventures Pty Ltd (2020) 154 IPR 68, of which we have recently become aware, at [435] - [488] to the effect that mere authorisation or licensing of the use of a trade mark is not capable of constituting trade mark infringement, because such authorisation or licensing does not amount to "use of a trade mark as a sign" within the meaning of s120 of the Trade Marks Act 1995 (Cth). The amendment clarifies that, while the Respondents admit the licensing by certain of them of the use of the name and mark "Katy Perry" in relation to relevant merchandise (as in paragraphs 7(a) and (a1)), the Respondents do not admit use of the trade mark by any of the Respondents. We acknowledge that this proposed amendment means that we need to correct the position in our letter dated 17 February 2020 to the effect that at that time, our clients accepted that to defeat your client's infringement claim, they needed to make good one of the statutory defences pleaded in subparagraphs 11(a) to (d) of the Defence and/or to succeed on the cross-claim. PDP Capital having been decided subsequent to that letter, the Respondents now seek to take the point that their licensing activities as pleaded in subparagraphs 7(a) and (a1) of the defence do not constitute trade mark infringement by them. Paragraph 11 (d1) This amendment is to clarify the Respondents' contention that they are not liable as joint tortfeasors where third party "operators" such as retailers have a defence to infringement under s 122(1) and 124 of the Act (as in Smith & Nephew Plastics (Aust) Pty Ltd v Sweetheart Holding Corp (1987) 8 IPR 285 at 290.7). 22 By letter dated 19 July 2021 Silberstein & Associates notified the respondents that Ms Taylor objected to the amendments to paras 10 and 11 included in the Proposed Further Amended Defence. In their letter Silberstein & Associates stated that Ms Taylor did not "agree to [the ‍respondents'] attempt to resile from their clarification of their defence as set out in [the 17 February 2020 Letter]". The letter continued: Our client has conducted the proceedings since February 2020, including preparation of evidence, discovery sought and granted, subpoenas sought, granted and served, consideration of documents produced, and taking a host of forensic decisions, including agreeing to the setting down of the matter for trial, by reference to and in reliance on the concessions your clients made in their Defence, and as clarified in your 17 February 2020 letter. You rely on the decision of PDP Capital Pty Ltd v Grasshopper Ventures Pty Ltd (2020) 154 IPR 68. PDP was handed down on 30 July 2020 - that is, almost a year ago. Further, in the section of that judgment ([435]-[488]) to which you refer in your letter, Markovic J referred to three decisions in support of her Honour's conclusions: Unilever Australia Ltd v PB Foods Ltd [2000] FCA 798; Louis Vuitton Malletier SA v Toea Pty Ltd (2006) 156 FCR 158 and Aristocrat Technologies Australia Pty Ltd v Vidtech Gaming Services Pty Ltd (2006) 68 IPR 229. Each of those decisions was decided more than a decade before these proceedings began. Further, you do not suggest in your letter that, prior to reading PDP, it was your or your clients' belief that the law was any different to the conclusion reached in PDP. You and your clients are bound by forensic decisions made to date as to how to defend these proceedings. Our client will hold you and them to those decisions. For completeness, our client does not concede that PDP would be relevant to the circumstances of these proceedings. 23 By letter dated 21 July 2021 from Corrs to Silberstein & Associates, Corrs sought to understand the steps that Ms Taylor might wish to take if the respondents were given leave to amend their defence as they proposed in the Proposed Further Amended Defence. This was said to be to assist in understanding the basis for Ms Taylor's opposition to the proposed amendments. 24 By letter dated 27 July 2021 Silberstein & Associates responded to Corrs' letter referred to in the preceding paragraph noting that Ms Taylor had already indicated her opposition to the Proposed Further Amended Defence including the "proposed withdrawal of an admission which was itself further clarified in" the 17 February 2020 Letter. In effect, Silberstein & Associates informed Corrs that, as no application to amend the defence had been filed, their client did not intend to further engage in relation to the issue. 25 Ms Gourley has provided an explanation for why the respondents now seek to amend para 10 in the way set out in the Proposed Further Amended Defence. She says: (1) at the time she wrote the 17 February 2020 Letter she understood the only potentially infringing conduct admitted by the respondents in this proceeding to be conduct by way of licensing the KATY PERRY name, brand and trade mark, referring to para 7 of Amended Defence; (2) until about 2 July 2021, and including at the time she wrote the 17 February 2020 Letter and certified the Amended Defence on 10 March 2021, it was her understanding of the law that trade mark licensing could amount to trade mark use and therefore infringement under the TM Act; (3) on about 2 July 2021 she became aware of the significance of the decision in PDP Capital Pty Limited v Grasshopper Venture Pty Limited [2020] FCA 1078; (2020) ‍154 IPR 68 at [435]-[488] to the effect that trade mark licensing might not constitute trade mark use and therefore would not, without more, constitute trade mark infringement; and (4) it was not until around this time that she came to understand that her prior understanding had proceeded on a misapprehension of the law. Upon gaining the understanding referred to in the preceding subparagraph Ms Gourley proceeded to obtain instructions from the respondents to take steps to seek to amend para 10 of the Amended Defence in the manner now proposed. 26 Dr Silberstein says that: (1) since the time of the 17 February 2020 Letter his understanding of the Amended Defence, arising from paras 7, 10 and 11, is that the respondents had made an admission that, save for the defences in para 11 (including the cross-claim), they have used the KATY PERRY mark as a trade mark in Australia in respect of various goods falling within the scope of the Registered Goods, or goods of the same description, and have thus infringed the Applicant's Mark (Respondent's Admission); and (2) save as to any dispute regarding which goods fall within the scope of the Registered Goods or goods of the same description, Dr Silberstein understood the various goods in respect of which the KATY PERRY mark has been used as a trade mark in Australia to be the goods listed in the "Confidential List of Goods" provided to Ms Taylor by the respondents and the goods sold at concerts in Australia and through the Myer Pty Ltd and Target Pty Ltd department stores referred to in the affidavits affirmed by Steven Jensen on 30 July 2020 and 23 July 2021. 27 Dr Silberstein says that he has subsequently undertaken his role as solicitor on the record for this proceeding and made forensic decisions regarding the running of this proceeding on the basis of the Respondents' Admission. Since the 17 February 2020 Letter Ms Taylor has: (1) served evidence in chief on 7 May 2020; (2) issued subpoenas to Target and Myer on 14 July 2020; (3) received evidence in chief from the respondents on 31 July 2020 and 26 August 2020; (4) joined further parities to the proceeding on 30 October 2020; (5) engaged in a dispute regarding discovery categories which was ruled on by the Court on 12 November 2020; (6) set the hearing down for trial commencing on 29 November 2021, which occurred on 12 November 2020; (7) engaged in discovery in accordance with the discovery categories on 26 February 2021; (8) obtained discovery in accordance with the discovery categories on 26 February 2021 and 1 April 2021; (9) prepared and served further evidence on 11 June 2021; and (10) received further evidence on 26 July 2021. Dr Silberstein observes that, save for those referred to at (1) and (2) above, all of the steps/events occurred after the decision in PDP Capital was handed down. 28 Dr Silberstein says that when filing Ms Taylor's amended originating application and the FASOC on 29 October 2020 he considered that, given the Respondents' Admission, provided that Ms Taylor succeeded in resisting the respondents' statutory defences as pleaded in paras 11(a)-(d) of the Amended Defence and in defeating the Amended Cross-Claim, it was not necessary to join third parties, such as Bravado International Inc and/or its related entities or Target and Myer, to guard against the possibility that infringement was not made out against one or more of the respondents. For that reason the amended originating application and the FASOC only joined Kitty Purry and Purrfect Ventures as third and fourth respondents. Ms Taylor became aware of those entities and their role by reason of the respondents' evidence in chief referred to at [27(3)] above. 29 Dr Silberstein says that if the respondents' proposed amendments to paras 10 and 11 as set out in the Proposed Further Amended Defence are allowed Ms Taylor will suffer the following prejudice: (1) the respondents will have available to them a defence that is not currently available to them by reason of the Respondents' Admission. That defence would be that they did not use the KATY PERRY mark in Australia as a trade mark in respect of the Registered Goods or goods of the same description and thus did not infringe the Applicant's Mark. Dr Silberstein says that such a defence, if made out, would defeat Ms Taylor's claim; (2) if that defence is open to the respondents he will have to consider whether it is in Ms ‍Taylor's interest to join other parties to the litigation who might have used the KATY PERRY mark in Australia as a trade mark in respect of the Registered Goods or goods of the same description to protect her position, such as Bravado and its related entities, Target, Myer, LP ATM, Blackout Merch, Merch Traffic LLC and Epic Rights. Dr Silberstein notes that many of these entities appear to be based in the United States of America and thus leave would have to be sought by Ms Taylor to join them to the proceeding and there would be delays in serving the originating process outside of Australia. He also says that those parties may have claims to make against their suppliers if the goods are infringing, which would further complicate matters, and that it is also possible that some of those entities would not, in fact, be entities using the KATY PERRY mark as a trade mark in Australia in respect of the Registered Goods or goods of the same description but may have commercial relationships with parties that are doing so, the identities of whom are unknown to him; (3) consideration would have to be given to whether Ms Taylor should seek further discovery, further subpoenas or Sabre orders to gather evidence demonstrating the practical day to day nature of the relationship between the respondents and one or more of the third parties referred to in the preceding subparagraph. Dr Silberstein says that this would include production of documents such as invoices, shipping and commercial documents, advertisements and communications that culminated in the sale of goods bearing the KATY PERRY mark to customers in Australia in order to identify instances earlier in the chain of commercial events where the KATY PERRY mark was used in physical or other relation to the Registered Goods or goods of the same description. Dr ‍Silberstein says that he has not sought discovery of that nature to date because he considered that the Respondents' Admission meant that it was not necessary; (4) consideration would also have to be given to whether Ms Taylor should seek further discovery from the respondents to gather evidence demonstrating the practical "day to day" nature of the relationship between them to establish the same matters referred to in the preceding subparagraph; (5) if there was either a need to join other parties to the proceeding or to obtain further discovery, seek the issue of further subpoenas or obtain Sabre orders this would almost certainly have the effect that the hearing date would be lost either because one or more new respondents would be joined to the proceeding, who would then need to file a defence and evidence, or because of the length of time necessary to determine appropriate discovery categories, obtain documents pursuant to those categories and to review and consider those documents; and (6) Ms Taylor is preparing for the hearing as scheduled in November 2021 and wishes to have the matter heard at that time. As that hearing concerns liability only it may be necessary to have a further hearing in relation to quantum in due course. Therefore, on the existing timetable, it may be more than a year before the applicant can obtain the relief she seeks and any further delay to her ability to obtain that relief will cause her prejudice.

Relevant principles 30 The pleadings have closed. Therefore the respondents require leave to amend their defence: see r 16.53 of the Federal Court Rules 2011 (Cth). 31 In Tamaya Resources Limited (in liq) v Deloitte Touche Tohmatsu (A Firm), in the matter of Tamaya Resources Limited (in liq) [2015] FCA 1098 at [125]-[128] Gleeson J set out the principles which apply when considering an application to amend a pleading as follows: 125 The applicable principles are well established. The Court's powers in rules 8.21(1) and 16.53 are broad. Consideration of whether to grant leave to amend must be undertaken in accordance with the overarching purpose set out in s 37M(1) of the Federal Court Act: Australian Competition and Consumer Commission v Jutsen (No 2) [2010] FCA 982 at [12]; Suzlon Energy Ltd v Bangad [2011] FCA 92; (2011) 196 FCR 259 at [19]; University of Sydney v ResMed Limited (No 5) [2012] FCA 232 at [14]; Bowen Energy Ltd v 2KD Drilling Pty Ltd [2012] FCA 275 at [8]. 126 The onus is on the party seeking leave to amend to persuade the Court that such leave should be given: Dye v Commonwealth Securities Ltd (No 2) [2010] FCAFC 118 at [17]. 127 The principles articulated by the High Court in Aon apply to matters in this Court: Cement Australia Pty Ltd v Australian Competition and Consumer Commission [2010] FCAFC 101; (2010) 187 FCR 261 ("Cement Australia") at [43]. Relevant matters the Court is to consider include: (1) The nature and importance of the amendment to the party applying for it: Aon at [102]; (2) The extent of the delay and the costs associated with the amendment: Aon at [102]; (3) The prejudice that might be assumed to follow from the amendment, and that which is shown: Aon at [5], [100] and [102]; (4) The explanation for any delay in applying for that leave: Aon at [108]; and (5) The parties' choices to date in the litigation and the consequences of those choices: Aon at [112] and Luck v Chief Executive Officer of Centrelink [2015] FCAFC 75 ("Luck") at [44]; (6) The detriment to other litigants in the Court: Aon at [93], [95] and [114] and Luck at [44]; and (7) Potential loss of public confidence in the legal system which can arise where a court is seen to accede to applications made without adequate explanation or justification: Aon at [5], [24] and [30]. 128 The weight to be given to the considerations identified in Aon, individually and in combination, and the outcome of the balancing process, may vary depending on the facts in the individual case: Cement Australia at [51]. 32 The factors referred to by her Honour at [127] were approved in Tamaya Resources Limited (in liq) v Deloitte Touche Tohmatsu (A Firm) [2016] FCAFC 2; (2016) 332 ALR 199 at [125]. 33 Here, in making the amendment to para 10, the respondents seek to withdraw an admission. The principles applicable to a grant of leave to withdraw an admission were recently summarised by Stewart J in Dollinger Filtration Ltd v Laminar Airflow Pty Ltd [2021] FCA 817 at [19] where his Honour said: I recently had cause in Selvaratnam v St George - A Division of Westpac Banking Corporation (No 2) [2021] FCA 486 at [27] to identify the applicable principles with regard to whether leave to withdraw an admission or other pleading that benefits another party should be granted. They are the following, noting that for simplicity I will refer only to the withdrawal of an admission: (1) The court has a broad discretion to weigh up all matters with the overall question being to ensure that there is a fair trial: Jeans v Commonwealth Bank of Australia Ltd [2003] FCAFC 309; 204 ALR 327 at [18] and [23] per Hill, Madgwick and Conti JJ. (2) The court will require an explanation for the making of the admission which is now sought to be withdrawn; the explanation must be a sensible one based on evidence of a solid and substantial character: Celestino v Celestino [1990] FCA 449 at 8 [12] per Spender, Miles and von Doussa JJ (noting that the AustLII MNC for this case is [1990] FCA 299). (3) The object of the courts is to decide the rights of the parties, and not to punish them for mistakes they make in the conduct of their cases; if the mistake is not fraudulent or intended to overreach, can be corrected without injustice to the other party, and if not corrected will not lead to a decision on the real matters in controversy, it should generally be corrected: Celestino at 7 [10]. (4) The overriding consideration is the interests of justice: Australian Competition and Consumer Commission v Construction, Forestry, Mining and Energy Union [2007] FCA 1390 at [4] per Finn J. (5) The court will not lightly permit a party to withdraw an admission where the other party has acted to its detriment on the admission or is otherwise prejudiced by the withdrawal; if the other party has in good faith relied on the admission to its detriment so as to give rise to an estoppel the court will not permit the admission to be withdrawn: Celestino at 10 [14]. 34 Ansell Healthcare Product LLC v Reckitt Benckiser (Australia) Pty Ltd (No 2) [2016] FCA 765 concerned, among other things, an application by the respondent to amend its defence by removing certain admissions. Commencing at [49] Rares J set out the applicable legal framework and principles including at [55]-[57] where his Honour said: 55 Recently in Tamaya Resources Limited (in Liquidation) v Deloitte Touche Tohmatsu (A Firm) [2016] FCAFC 2 at [154]-[156], Gilmour, Perram and Beach JJ discussed the principles for considering the quality of an explanation given by a party seeking to withdraw admissions or make amendments to pleadings. They said: Just what explanation is called for will necessarily depend upon the particular case. The explanation will be given by, or on behalf of, the moving party. Affidavit evidence may or may not be necessary. In Cement Australia, for example, as the explanation was that the error was one of judgment by senior counsel for the ACCC, a statement by him from the bar table, to which no objection was taken, was accepted by the Court as sufficient. It must be borne in mind that the explanation required is that of the moving party, not merely their solicitor or counsel. The client may very well know of matters relevant to the explanation for delay which are not known by the lawyers. Evidence as to the explanation for delay will often be given by an applicant's solicitor from their own knowledge but that may, in some cases, not be sufficient. This is such a case. The primary judge was correct to conclude that the explanation offered by Tamaya was deficient because Ms Banton could not explain why she did not know of the Chilean audit issues until she was told by Mr Basford. (emphasis added) 56 They held that the actual party which had sought the amendment had given no evidence, itself, as opposed to its solicitor, about what the party knew and how the party had come to make the original forensic choice from which it sought later to depart. 57 And, in DeMasi v Linfox Transport (Aust) Pty Limited (unreported, NSWSC, 14 June 1995) McClelland CJ in Eq said: … it is a significant matter to permit an admission to be withdrawn because it may be the fact that the admission connotes an acknowledgment of the correctness of the fact admitted. (emphasis added) (Original emphasis.)

Consideration 35 Regrettably the parties were at odds as to the effect of the pleading in para 10 of the defence first filed by Killer Queen and Ms Hudson and maintained by the respondents in the Amended ‍Defence. The correspondence that passed between them, culminating in the 17 February 2020 Letter, did not assist. The meaning of para 10 as currently pleaded and the effect of the admission in para 10(b) thus falls to be resolved as a preliminary matter. 36 Ms Taylor understood that the combined effect of para 7, 10 and 11 of the Amended Defence is that the respondents have admitted trade mark infringement, save for their defences pleaded at [11] or success on the Amended Cross-Claim. That is, Ms Taylor understood that the pleading at paras 7 to 10 was, in effect, an admission of each of the elements required to prove trade mark infringement for the purpose of s 120 of the TM Act: there is a statement that each of the respondents have provided licences of the KATY PERRY name (para 7); there is an admission that the KATY PERRY mark is deceptively similar to the Applicant's Mark (para 9); and there is an admission that the KATY PERRY name is used as a trade mark in relation to the merchandise in para 7(b), which includes clothing, by the respondents (para 10). She submitted that the proposed amendment to para 10 would have the effect of withdrawing that admission because it would mean that the respondents could (and apparently will) submit that Ms Taylor has not proved that they have used the KATY PERRY mark as a trade mark in Australia in respect of any goods and thus will allow them to deny that Ms Taylor has satisfied the requirements of s 120 of the TM Act. 37 Contrary to Ms Taylor's submissions, an analysis of the FASOC and the Amended Defence demonstrates that the admission made in para 10 of the Amended Defence is limited in the way contended by the respondents. That is, it is an admission that the licensing of the KATY PERRY mark by the respondents constituted use for the purposes of s 120 of the TM Act. My reasons for coming to this view follow. 38 The text of the relevant part of the FASOC is set out at [11] above. In summary the FASOC: (1) alleges that the respondents infringed the applicant's mark both directly by their use of the KATY PERRY mark and indirectly as joint tortfeasors; (2) in particular, para 7 alleges that the respondents themselves carried out the Accused ‍Acts, as defined. That is, by importing for sale, distributing, advertising, promoting, marketing, offering for sale, supplying, selling and/or manufacturing in Australia or to people in Australia the Registered Goods or goods of the same description bearing or in association with the KATY PERRY mark; (3) at paras 8 and 9A it is alleged that the respondents participated in a common design with named third parties to carry out the Accused Acts and that the respondents are each a joint tortfeasor in acting in that way with each of those third parties; (4) at para 9 it is alleged that each of the KATY PERRY marks which are said to be used by the respondents and the named third parties, is substantially identical with, or deceptively similar to, the Applicant's Mark; (5) in para 10 it is alleged that the conduct referred to in para 7, namely the conduct that gives rise to the direct trade mark infringement claim by the respondents, and/or the conduct referred to in para 8, namely the conduct that gives rise to the allegation of trade mark infringement against the respondents as joint tortfeasors, constituted use of the KATY PERRY marks as trade marks in respect of the Registered Goods and/or goods of the same description. That is, the allegation of use of the trade marks in para 10 is in relation to both types of trade mark infringement alleged against the respondents; and (6) in para 11 it is alleged that first, by reason of the matters pleaded in para 7, 9 and 10 of the FASOC, which concern the direct claim of trade mark infringement against the respondents, and secondly, in the alternative, by reason of the matters pleaded in paras 7 to 10, which concerns the claim against each of the respondents as joint tortfeasors, the respondents have infringed the Applicant's Mark pursuant to subs 120(1) and (2) of the TM Act. 39 It is apparent that the claim of trade mark infringement by the respondents is made on two bases although the structure of the pleading is to combine or "wrap up" the two claims at certain points. 40 It is then necessary to consider the Amended Defence in order to understand the nature of the admission made in para 10 thereof. It has a number of features: (1) by para 7 the respondents plead that prior to the establishment of Killer Queen Ms Hudson and, after the establishment of Killer Queen, Killer Queen provided licences of the KATY PERRY name, brand and trade mark on commercial terms and that, from time to time since their establishment, Kitty Purry and Purrfect Ventures have also provided such licences. The respondents say that pursuant to those licences various merchandise, including clothing, bearing the KATY PERRY mark has been offered for sale, supplied and sold by persons including retailers to persons resident in Australia. The respondents otherwise deny the allegations in para 7 of the FASOC. That is, while the respondents admit that licences were provided and sale or supply of merchandise including clothing has been made pursuant to those licences, i.e. by the licensees, they deny the allegations that underpin the direct trade mark infringement claim; (2) in paras 8 and 9A the respondents answer the allegation that they were each a joint tortfeasor as alleged in paras 8 and 9A of the FASOC. They repeat the pleading as to the provision of licences for use of the KATY PERRY mark included in para 7 of the Amended Defence and otherwise deny the allegations; (3) the respondents admit that the KATY PERRY mark (and each of the Infringing Marks as defined in the FASOC) is deceptively similar to the Applicant's Mark but otherwise deny the allegations in para 9 of the FASOC; and (4) finally, the respondents plead to para 10 of the FASOC. In doing so they repeat paras 7(a), (a1) and (b) of the Amended Defence (see at [12] above) that each of Killer Queen, Ms Hudson, Kitty Purry and Purrfect Ventures has at various times granted licences of the KATY PERRY mark. Next, they admit, in relation to the merchandise referred to at para 7(b) of their defence, that the name KATY PERRY is used in relation to such merchandise by or under the control of the respondents. Lastly, they otherwise deny the allegations in para 10 of the FASOC. 41 Based on this analysis, the admission clearly relates to the merchandise that was offered for sale, supplied and sold pursuant to the licences granted by the respondents. That is, the respondents admitted use of the KATY PERRY mark insofar as merchandise, including clothing, was sold pursuant to the licences. The defence may not have been drafted with crystal clarity. Clearly, given the exchange of correspondence, Ms Taylor had questions about its meaning. However, when it is considered in the context of the FASOC and having regard to all of its terms, its meaning becomes clearer and the limited effect of the admission in para 10 is apparent. 42 Ms Taylor placed some emphasis on the 17 February 2020 Letter in support of her construction of the admission. She asked the rhetorical question, how could one deny the allegations of trade mark infringement in para 11 of the FASOC if each element of infringement had been admitted and contended that it was for that reason that Silberstein & Associates wrote their letter dated 13 February 2020 to Corrs (see [18] above) which elicited the 17 February 2020 Letter in response. But, the respondents accept that that the position stated in the 17 February 2020 Letter, which was written before the decision in PDP Capital was handed down, needs to be corrected. 43 The next question that arises is whether the respondents should be granted leave to amend para 10 in the way proposed which would result in a withdrawal of the admission. 44 Ms Taylor submitted that seeking to withdraw the admission is not "uncontroversial" and that there is no evidence that the admission was made based on a view of the law. Rather, the admission is to a central matter of fact in the case, being the use of the KATY PERRY mark as a trade mark by the respondents in Australia. That submission (which was developed further) need not be addressed further given the view I have reached regarding the effect of the admission. 45 Ms Taylor submitted that, remarkably, there is not one shred of evidence about the circumstances in which the admission came to be made. She submitted that this ought to be fatal to this part of the respondents' application. She contended that there is no evidence that the respondents made their admission on a view of the law which was at odds with the conclusion in PDP Capital. That is, even if the respondents were not aware of PDP Capital, there is no evidence that they were advised whether to make an admission as to trade mark use based on their licensing of third parties, or at all. 46 Ms Taylor submitted that, given the absence of any evidence in respect of this issue, the Court can safely infer that any evidence led would not have assisted the respondents and that such an inference is open on an application to withdraw an admission where evidence explaining the basis of an admission is not led. Ms Taylor submitted that, ultimately, the respondents should be held to the choices they have made in respect of the conduct of the litigation to date, relying on Tamaya Resources at [127(5)]. 47 Ms Taylor observed that the respondents seek to withdraw the admission in light of the decision in PDP Capital of which, at the time of writing their letter on 15 July 2021, they said they had recently become aware. Ms Taylor contended that, despite preparing an affidavit in support of the application, Ms Gourley had not clarified that assertion in her evidence but simply relied on her correspondence which, Ms Taylor said, falls short of an adequate explanation. Ms Taylor submitted that, indeed, it is wrong for the respondents to submit, on the evidence, that they and their advisors only recently became aware of PDP Capital as Corrs' letter of 15 July 2021 merely says that "we" have recently become aware, with no explanation as to who the "we" is, or how it was that they only "recently" became so aware. 48 Ms Taylor contended that, in any event, the conclusion in PDP Capital was itself based on a number of other decisions all of which had been handed down more than a decade before this proceeding commenced. She contended that the submission that the respondents' advisors were also not aware of these decisions must be rejected on the basis that there is no evidence from Ms Gourley to establish such an assertion. 49 Ms Taylor raised a number of matters in relation to the prejudice that would be occasioned if the amendment is allowed which are set out and considered at [63]-[73] below. 50 Finally, Ms Taylor submitted that the respondents have not provided any, or any adequate, explanation for the delay in seeking to amend and, in the absence of any evidence, the ostensible justification for the amendment is the decision in PDP Capital. However that decision was handed down on 30 July 2020, almost 15 months ago, and virtually all interlocutory steps in the proceeding have been undertaken since that time. Ms Taylor submitted that, had the amendment been sought in a timely manner, the prejudice identified in relation to the forensic decisions made and the question of joinder of third parties would not arise. She observed that Ms Gourley provides no explanation as to how and why it was that PDP Capital only came to the attention of someone recently, nor what "recently" means. Ms Taylor submitted that if there is not a proper explanation in the evidence that adequately justifies an extensive delay that is an important reason to refuse leave to amend. 51 Having carefully considered these submissions and the applicable principles, I have come to the view that the amendment to para 10 should be allowed. My reasons follow. 52 The admission was first made in December 2019 at the time of the filing of the defence to the amended statement of claim and remained in the Amended Defence which was filed on 10 March 2021. The respondents seek the amendment to para 10 of the Amended Defence on the basis of the decision in PDP Capital which was handed down on 30 July 2020. 53 Ms Gourley's evidence, which the respondents rely on in support of their application to amend their defence, is set out at [25]. Ms Taylor criticises that evidence. She says that it falls well short of the evidence required to support the withdrawal of an admission, relying on Ansell, particularly at [55]-[57] (see [34] above) and the Court's observations at [58]-[60] about the quality of the evidence relied on by the party seeking to withdraw the admission in that case. She also says that the respondents by that evidence fail adequately to explain the delay in seeking the amendment. 54 Ms Gourley candidly explains that she only became aware of the decision in PDP Capital and its significance on 2 July 2021, well after Killer Queen and Ms Hudson had filed their defence and after she had certified the Amended Defence. It was only upon becoming aware of the decision in PDP Capital that Ms Gourley understood that trade mark licensing might not constitute trade mark use and therefore would not, without more, constitute trade mark infringement and that her prior understanding had proceeded on a misapprehension of the law. I pause here to observe that in the course of argument senior counsel for the respondents informed the Court, again candidly, that it was not Ms Gourley's fault alone and this was an error for which he is "principally responsible", that a mistake had been made, they were not aware of PDP Capital and they should have been. Once Ms Gourley understood the significance of PDP Capital she proceeded to obtain instructions from the respondents to seek to amend para 10 of the defence. 55 Relevantly, in PDP Capital one of the issues raised for consideration by the respondent, Grasshopper Ventures Pty Ltd, was whether use of the trade mark in issue by a trading company authorised to do so by it constituted use of that mark as a trade mark by Grasshopper for the purposes of s 120 of the TM Act. That issue was determined in favour of Grasshopper: see PDP Capital at [488]. I found that Grasshopper's authorisation of the use of the mark in question was not capable of constituting trade mark infringement for the purposes of s 120 of the TM Act. 56 On appeal that finding was challenged. In PDP Capital Pty Ltd v Grasshopper Ventures Pty Limited [2021] FCAFC 128; (2021) 391 ALR 608 (PDP Capital Appeal) a Full Court of this Court (Jagot, Nicholas and Burley JJ) rejected the appellant's contentions that Grasshopper should be taken to have engaged in an act of infringement by authorising one or more of the companies in the group to apply the mark in question to various products and that Grasshopper's conduct fell within that prescribed by s 120 of the TM Act: see PDP Capital Appeal at [65]-[75]. 57 By the amendment, which reflects the reasoning in PDP Capital (as confirmed in PDP Capital Appeal), the respondents seek to add to their defence to the direct trade mark infringement claim a contention that the mere licensing of the use of the KATY PERRY mark as alleged in paras 7(a) and (a1) of the Proposed Further Amended Defence does not constitute infringement of the Applicant's Mark by them. The admission as currently made in para 10 is incorrect as to a matter of law. The respondents seek to make an amendment which is consistent with the law as it currently stands. 58 In those circumstances I do not agree that the respondents' evidence suffers from the deficiencies alleged by Ms Taylor. As set out above, Ms Taylor relied on the observations at [58]-[60] of Ansell. 59 Ansell concerned a claim for infringement of a patent. In that case, as here, the respondent who was seeking to withdraw admissions relied entirely on evidence given by its solicitor as to why the admissions had been made and why it now sought to withdraw them. Relevantly, the admissions concerned the properties of the product the subject of the claim for patent infringement. That is, they were admissions as to matters of fact. At [59] Rares J found that the absence of any evidence about the knowledge or state of mind of the respondent's own personnel was "striking" and that it had remained silent on how it, as opposed to its solicitors, had made the admissions and whether they were incorrect. His Honour found that the respondent made a deliberate choice in circumstances where it was open to it to explain the material and thus inferred that nothing the respondent could say would have assisted its case. Justice Rares concluded that there was no evidence that the respondent would suffer any injustice by being held to those admissions and that the evidence showed that it had made the admission for a tactical reason: see Ansell at [62]-[63]. The amendment by which the admission would have been withdrawn was refused. 60 This case is different. The admission the respondents seek to withdraw goes to a matter of law and not a factual matter. It is therefore understandable and entirely appropriate that the explanation for why the respondents made the admission originally but now seek to withdraw it comes from their lawyer and not from someone within the respondents. It would be curious if any member or officer of the respondents or Ms Hudson herself was able to give evidence about their understanding, or the effect, of Australian trade mark law. Accordingly in the circumstances of this case it is entirely appropriate that the reason why the admission was first made and the reason why the respondents now seek leave to withdraw it by amending their defence has been provided by Ms Gourley. 61 As to the evidence itself, while not detailed, given the nature of the admission which the respondents seek to withdraw it is sufficient both in terms of explaining why the admission was made and why the respondents now wish to withdraw it and the delay. Ms Gourley does not, in terms, explain why it took 15 months. But in my opinion the evidence speaks for itself and it is not necessary for her to provide any further evidence given the facts that are disclosed. That is, Ms Gourley simply was not aware of the decision. 62 Ms Taylor says that the point of law clarified by PDP Capital and PDP Capital Appeal was based on authorities the subject of analysis in PDP Capital at [454]-[487], referring in particular to Unilever Australia Ltd v PB Foods Ltd [2000] FCA 798, Louis Vuitton Malletier SA v Toea Pty Ltd (2006) 156 FCR 158 and Aristocrat Technologies Australia Pty Ltd v Vidtech Gaming Services Pty Ltd [2006] FCA 275 (2006) 68 IPR 229, which were handed down well prior to the commencement of this proceeding. Ms Taylor contended that the respondents' advisors must have been aware of these authorities. But even if they were, that is not to the point. As I observed at [453] of PDP Capital "[s]ave in one limited respect I was not taken by the parties to any case that had considered the issue" raised. That is, the issue had some novelty about it, had not been squarely considered and, to the extent it had been, there was some divergence in the authorities. 63 The remaining factor to consider is that of prejudice: see Tamaya Resources at [127]. In that regard Ms Taylor raises six matters, a number of which are related and which I consider below. 64 The first matter raised by Ms Taylor concerned the effect of the withdrawal of the admission. Ms Taylor submitted the starkest prejudice is that the respondents will have available to them a defence that they currently do not have, namely asserting that she has not made out her claim of infringement which is a complete defence to her case. Ms Taylor submitted that the prejudice to her brought about by this change is far greater than its importance to the respondents because the respondents have other defences and a cross-claim. However, this factor cannot be a relevant prejudice where the nature of the amendment is to correct what was otherwise an incorrect understanding of the law. It would not be appropriate, or in the interests of justice, to permit the case to proceed in that way. 65 Next, Ms Taylor submitted that her solicitor has made forensic decisions about the conduct of her case on the basis of the admission having been made. Since the 17 February 2020 Letter all interlocutory steps in the proceeding in relation to evidence, subpoenas, joinder and discovery have been undertaken. Insofar as the joinder of other parties was concerned Ms Taylor submitted that, if the amendment is allowed, she will be forced to consider whether it is necessary to join some or all of the third parties identified by Dr Silberstein in his evidence to guard against the Court finding (absent the admission) that the respondents did not use the KATY PERRY mark as a trade mark in Australia. As many of those potential respondents are based overseas it will create significant legal and logistical complications to do so. 66 It is evident from the claim as pleaded that, from the outset, Ms Taylor was aware that the respondents may not have used the KATY PERRY mark in Australia and that it may only have been used by third parties. In the amended statement of claim, which was filed prior to the filing by the then respondents, Killer Queen and Ms Hudson, of their defence and thus prior to the making of any admission, Ms Taylor alleged that the respondents had participated in a common design with third parties and that they were liable as joint tortfeasors. At that time those third parties included Target and Myer and various websites. Ms Taylor chose not to join any third party to the proceeding but to plead a case in joint tortfeasorship. I would infer that the claim of joint tortfeasorship was included to guard against the possibility that the use of the KATY PERRY mark by those third parties was not trade mark use by the respondents and thus not trade mark infringement. The case in joint tortfeasorship has been maintained in the FASOC despite the admission. 67 Ms Taylor submitted that while she may have been aware that some parties other than Killer Queen and Ms Hudson were involved in the sale of Katy Perry branded goods from the outset of the litigation, she did not know the identity of all relevant parties and the inter-relationship between them and Killer Queen and Ms Hudson and this was not something she could have discovered other than through this litigation. She submitted that it cannot be said that she had no further intention to join parties merely because they were not initially joined. 68 Dr Silberstein's evidence is that he would need to consider whether to join third parties as a result of the withdrawal of the admission in para 10. However, he does not explain why it is that he would reach a different decision about the joinder of third parties now as opposed to when the proceeding was commenced or when the FASOC was filed. That is particularly stark in the case of Target and Myer of whom Ms Taylor has been aware since the outset of the litigation. As to the other potential third parties raised by Ms Taylor: (1) in a letter dated 25 August 2020 Dr Silberstein wrote: However, any dispute regarding discovery must necessarily await: (a) our review of the subpoenaed material from Target and Myer, the balance of which we expect to receive this week or early next week; and (b) our consideration of whether or not our client ought to join new respondents to the proceedings arising out of the review of your clients' evidence and the subpoena materials. It appears that potential respondents would include further entities associated with your client such as Kitty Purry, Inc and Purrfect Ventures LLC, as well as third party entities such as Bravado International Group, Inc., Bravado International Group Merchandising Services, Inc, GBG USA Inc and Direct Management Group Inc. Our client is entitled to carefully consider such matter before making a decision and filing any joinder application. (Emphasis added.) (2) in a letter dated 7 August 2020, again prior to the filing of the FASOC, Dr Silberstein wrote: Joinder Having considered your clients' evidence and the subpoena materials, we anticipate imminent receipt of instructions to file an interlocutory application joining Kitty Purry Inc and Purrfect Ventures LLC to the proceedings as respondents. Both entities appear to be related to your clients. ... Our client is also considering her position as to whether to join Bravado International Group Merchandising Services, Inc (Bravado). However, our client cannot sensibly make that decision without understanding the proportion of profits arising from licensing of your clients' marks which is taken by Bravado versus that which is passed onto your clients and Kitty Purry Inc. We request that you provide an unredacted version of the agreements between your clients and Kitty Purry and the Bravado entities so that a decision can be made. If it will provide your clients comfort, those documents can be subject to a confidentiality regime whereby access is restricted to external counsel only (that is, solicitors and barristers). (Emphasis added.) 69 Both letters were sent after the filing of Killer Queen and Ms Hudson's defence to the amended statement of claim (which first included the admission) and prior to the filing of the FASOC. These letters, and in particular the second of them, indicate that Ms Taylor was considering whether, at least in the case of Bravado International Group Merchandising Services Inc, it was beneficial, presumably from a cost benefit perspective, to join that company. She has not done so to date. It is difficult to see how she would have come to a different view on that issue had the admission as to trade mark use not been made. 70 The third matter relied on by Ms Taylor is that she would have to consider whether she should seek further discovery, subpoenas, or Sabre orders to lead further evidence establishing use of the KATY PERRY mark as a trade mark in Australia by the respondents. Ms Taylor refers to and relies on the evidence given by Dr Silberstein (see [26]-[29] above). Relevantly, by orders made on 12 November 2020 (Discovery Orders) the respondents were ordered to give discovery of, among other things: 1. Documents which record, describe or evidence the terms of any agreements entered into between any one or more of: (a) the Respondents, and/or (b) any related party of the Respondents; and/or (c) (without limiting (b)), Bravado, DMG, or GBG USA Inc; and/or (d) one or more third parties other than the Department Stores (including, but not limited to, the Pop Up Stores, Named Websites, or other websites particularised in paragraph 7 of the Statement of Claim), in respect of, inter alia, any importation for sale, distribution, advertisement, promotion, marketing, offer for sale, supply, sale and/or manufacture in Australia or to people in Australia, clothes or Related Goods bearing, or otherwise in association with, the Alleged Infringing Marks. For the purposes of the Discovery Orders "Third Parties" was defined to mean "Bravado International Group Inc, Bravado International Group Merchandising Services Inc (together, Bravado); Direct Management Group Inc (DMG); GBG USA Inc; and NKSFB, LLC". Categories 2 to 5 of the Discovery Orders sought documents which went to the joint tortfeasorship case. 71 There has thus already been discovery in relation to the relationship between the respondents and various third parties and in relation to the joint tortfeasorship case. Ms Taylor contended that she would now need to seek further evidence of how particular goods came to be sold to customers in Australia to identify instances in the chain of commercial events where the KATY PERRY mark was used in physical or other circumstances by the respondents. That is, based on her understanding of the admission, Ms Taylor would now need to seek further discovery to show that the respondents were using the mark. That this is so arises from Ms Taylor's misunderstanding as to the ambit of the respondents' admission in para 10 of the original defence and the Amended Defence. An application for further discovery of this nature may well be a consequence of the withdrawal of the admission. If such an application is made it will need to be addressed at the time. In any event I apprehend that, if further discovery is sought, subject to its ambit, the respondents would co-operate. This is particularly so given the submission by senior counsel for the respondents that if further discovery is required "that could obviously be done within the next two and half months without jeopardising the trial". 72 Lastly, Ms Taylor submitted that taking steps to consider the joinder of additional parties and the seeking of further disclosure would almost certainly cause the hearing date to be lost and that further delay to her obtaining relief will cause her substantial prejudice. Ms Taylor submitted that the fact that she is funded is irrelevant. If her rights are being infringed, she is prejudiced because of the further delay to her in receiving relief. Relatedly, Ms Taylor submitted that the prejudice is of a kind that cannot be compensated by an award of damages. She contended that, if the amendment is allowed, as well as the prejudice she has identified she would incur further costs in respect of at least the further steps that may need to be undertaken. 73 Allowing the amendment may lead to an application by Ms Taylor to adjourn the hearing currently scheduled to commence on 29 November 2021. However, no such application has been made and, if made, will need to be considered at the time. Ms Taylor does not otherwise identify any prejudice she suffers with any precision beyond stating generally that if her rights are being infringed then she has a right to relief sooner rather than later. So much can be accepted. But again, in the absence of any application for an adjournment of the hearing, this submission does not go very far to establishing any actual prejudice. 74 Consideration of whether to grant leave to amend is to be undertaken in accordance with the overarching purpose in s 37M(1) of the Federal Court Act: see Tamaya Resources at [125]. That purpose is to facilitate the just resolution of disputes according to law and as quickly, inexpensively and efficiently as possible. Having regard to the matters set out above, it would not be consistent with the overarching purpose to permit the case to proceed based on an admission which is not consistent with the current law. To the extent that Ms Taylor suffers any prejudice by reason of the amendment, it is apparent that it can be addressed and is, in my opinion, outweighed by that consideration. Accordingly the amendment to para 10 should be allowed. 75 The respondents also seek leave to amend para 11 of the Amended Defence in the manner identified at [13] above. Ms Taylor conceded that if the amendment to para 10 is allowed then it would follow that the amendment to para 11 would also be allowed.

Conclusion on leave to file the Proposed Further Amended Defence 76 It follows from the above that the respondents should be granted leave to file their defence in the form of the Proposed Further Amended Defence.

should leave be granted to file the proposed further amended CC? 77 The cross-claimants seek leave to file the Proposed Further Amended CC which seeks to make two amendments: the first is the inclusion of a new para 8A and a consequential amendment to para 9; and the second is to para 20. Ms Taylor opposes the first proposed amendment and opposes the inclusion of subpara (c) in the second amendment. 78 The first proposed amendment concerns the claim for cancellation of the Applicant's Mark made by the cross-claimants pursuant to s 60 and s 88(2)(a) of the TM Act. Section 60 provides: The registration of a trade mark in respect of particular goods or services may be opposed on the ground that: (a) another trade mark had, before the priority date for the registration of the first-mentioned trade mark in respect of those goods or services, acquired a reputation in Australia; and (b) because of the reputation of that other trade mark, the use of the first-mentioned trade mark would be likely to deceive or cause confusion. (Note omitted.) 79 The claim, incorporating the proposed amendment, would be as follows: 8. Before the Priority Date for the Katie Perry Mark in respect of clothes, the trade mark KATY PERRY had acquired a reputation in Australia. Particulars The Cross-claimants refer to and repeat the Particulars to paragraph 11(c) of their Defence in these proceedings. 8A. Before the Priority Date for the Katie Perry Mark, the Katie Perry Mark had not acquired a reputation in Australia in respect of clothes. 9. Because of the reputation of the KATY PERRY trade mark matters alleged in paragraphs 8 and 8A of this Further Amended Statement of Cross-Claim above, the use of the Katie Perry Mark would be likely to deceive or cause confusion. 10. By reason of the matters pleaded in paragraphs 8, 8A and 8A9 (sic) of this Cross-claim above, registration of the Katie Perry Mark: (a) could have been opposed on the ground provided under section 60 of the TM Act; and (b) is liable to be cancelled under section 88(1)(a) of the TM Act on the ground set out in section 88(2)(a) of the TM Act. (Strike out and underlining in original.) 80 The second proposed amendment concerns the claim made for cancellation of the Applicant's Mark under s 88(2)(c) of the TM Act which provides: (2) An application may be made on any of the following grounds, and on no other grounds: … (c) because of the circumstances applying at the time when the application for rectification is filed, the use of the trade mark is likely to deceive or cause confusion; 81 The claim, incorporating the amendment, would be as follows: 20. By reason of: (a) the matters in paragraphs 8, 8A, 11, 12 and 15 of this Further Amended Statement of Cross-claim above; (b) the Cross-claimants' reputation in the KATY PERRY mark from before the Priority Date to the date of this Cross-claim; and (c) the extent of the Cross-Respondent's use of, and reputation in, the Katie Perry Mark in relation to clothes up to the date of this Cross-Claim, the circumstances at the date of this Cross-claim are that use of the Katie Perry Mark is likely to deceive or cause confusion. (Underlining in original.) 82 The cross-claimants submitted that these amendments arise out of some inter partes correspondence concerning discovery category 5 (as to which see below). Ms Taylor objects to that category of discovery on the grounds of relevance. The issue that arises in respect of these amendments and (discovery category 5) is whether Ms Taylor's reputation is relevant to the claim under s 60 and/or s 88(2)(c) of the TM Act. More particularly Ms Taylor opposes the proposed new para 8A and the amendment to para 9 of the Proposed Further Amended CC on the basis that she says that it is not reasonably arguable that the alleged lack of reputation in the Applicant's Mark in relation to the Registered Goods prior to the priority date is relevant to the inquiry under s 60 and opposes the amendment to para 20 by inclusion of subpara (c) on the basis that it raises a new issue not previously raised in the proceeding and which does not arise on the evidence led to date. 83 I address each of the proposed amendments in turn. In doing so I note that the principles set out at [31] above apply equally here although Ms Taylor does not allege that she would suffer any prejudice should either of the amendments be allowed nor does she contend that there is any unexplained delay in seeking leave to amend at this stage of the proceeding.

The first proposed amendment - paras 8A and 9 84 The cross-claimants submitted that the amendment by way of inclusion of para 8A and the amendment to para 9 should be allowed. They said that the Court could not be satisfied that reputation of the Applicant's Mark before its priority date is not reasonably arguably relevant to the question of whether the Applicant's Mark is liable to be cancelled because its registration could have been opposed under s 60 of the TM Act. They submitted that there is authority to support the proposition that Ms Taylor's conduct and reputation prior to the priority date of the mark is relevant to the s 60 defence, relying on Rodney Jane Racing Pty Ltd v Monster Energy Company [2019] FCA 923; (2019) 370 ALR 140 at [88] and Colorado Group Ltd v Strandbags Group Pty Ltd (2007) 164 FCR 506 at [136]. 85 The cross-claimants submitted that, given the bare denials in Ms Taylor's defence to paras 8 to 10 of the Amended Cross-Claim as currently pleaded, it is not clear that she will not submit at trial that the use of her mark before the priority date is relevant to the s 60 assessment so far as that use diminishes the likelihood that the KATY PERRY mark had acquired a distinctive reputation as at the priority date of the Applicant's Mark. In that regard, the cross-claimants note that Ms Taylor has led evidence of her use of the Applicant's Mark before the priority date which, although relevant to other aspects of her case, cannot be said to be wholly irrelevant to the s 60 issue. 86 Ms Taylor submitted that the cross-claimants have adduced no evidence as to why her reputation in the Applicant's Mark is relevant to the s 60 ground of cancellation. Irrespective, she says it is not and that the proposed amendment seeks to insert an irrelevant consideration into the s 60 test. Ms Taylor submitted that the following general principles apply to s 60 of the TM Act (omitting citations): (1) the likelihood of deception or confusion from the use of the opposed mark must arise because of the reputation of the other mark. The Court must compare "mark and reputation" rather than "mark and mark"; (2) the reputation of the other mark is to be assessed at the priority date of the opposed application; and (3) the relevant comparison is between the prior mark as actually used and a notional normal and fair use of the mark sought to be registered. 87 Ms Taylor submitted that accordingly, the actual use of a mark (if any) made by the party seeking registration is irrelevant. She said that attention is focused upon the reputation (if any) of the other mark and that the decision in Rodney Jane does not suggest otherwise because in that case there was a positive assertion by the applicant for the mark that use of the mark prior to the priority date by them and other traders meant that there could be no distinctive reputation in any particular trader for the prior mark. That is, the submission was directed towards whether or not the party relying on s 60 had established the existence of the reputation in a mark as at the priority date, a matter addressed by the current pleading in para 8. Ms Taylor submitted that the issue that arose in Rodney Jane does not arise here because she does not assert that the KATY PERRY mark cannot have achieved a reputation by reason of other persons using that mark prior to the priority date. 88 In Tamaya Resources at [143] Gleeson J relevantly said: The Court will not grant leave to allow an amendment if it would be liable to be struck out had it appeared in the original pleading: Caason at [21]; Research in Motion at [21] to [22]; Horton v Jones (No 2) (1939) 39 SR (NSW) 305 at 310; McGuirk v University of New South Wales [2009] NSWSC 1424 at [18]. 89 The question that then arises is whether the reputation in the Applicant's Mark before the priority date is reasonably arguably relevant to the question of whether that mark is liable to be cancelled because its registration could have been opposed under s 60 of the TM Act. 90 The cross-claimants rely on Rodney Jane. In that case, among other things, the respondent, Monster Energy Company (MEC) opposed registration of the appellant's trade marks, referred to as the RJR marks, under s 60 of the TM Act. Commencing at [86] O'Bryan J set out the parties' submissions. In doing so he noted (at [85]) that those submission were at variance on a number of matters, although the variance was mainly a matter of emphasis. The cross-claimants rely in particular on [88] where his Honour recorded the parties' submissions concerning the relevance of use of the RJR marks before the priority dates, in relation to which, as here, there was some disagreement. His Honour said: Third, there was some disagreement as to whether the use of the RJR marks before the priority date was relevant to the s 60 assessment. MEC submitted that the use or reputation of opposed marks is generally not relevant to the comparison of marks under s 60. The language of s 60 asks simply whether the use of the opposed mark is likely to deceive or cause confusion because of the reputation of the prior mark. The assessment is made by considering a notional normal and fair use of the opposed mark. MEC accepted that account could be taken of the notional consumer's familiarity with an element of the opposed mark where that element has a degree of notoriety or familiarity of which judicial notice can be taken (such as the brand Woolworths): Woolworths at [61] per French J; CA Henschke & Co v Rosemount Estates Pty Ltd (2000) 52 IPR 42; [2000] FCA 1539 at [52]; Crazy Ron's at [90]; Australian Meat Group at [41]. However, it submitted that that principle has no application to the RJR marks. RJR submitted that it is well established that, when assessing whether a party (here MEC) had acquired a distinctive reputation in a mark, third party usage of that mark "weighs heavily against the conclusion" (Yarra Valley Dairy Pty Ltd v Lemnos Foods Pty Ltd (2010) 191 FCR 297; 90 IPR 117; [2010] FCA 1367 at [256]-[257] per Middleton J) and that third party usage will make it more difficult for a party to establish that use of that mark is likely to deceive (Telstra Corporation Ltd v Phone Directories Company Australia Pty Ltd (2014) 316 ALR 590; 107 IPR 333; [2014] FCA 568 at [580] per Murphy J, in the context of passing off and misleading or deceptive conduct). RJR submitted that it followed that use of the RJR marks before the priority date would be relevant to the s 60 assessment in so far as that use diminished the likelihood that the MEC marks had acquired a distinctive reputation in the word "Monster" (also relying on Colorado Group Ltd v Strandbags Group Pty Ltd (2007) 164 FCR 506; 243 ALR 127; 74 IPR 246; [2007] FCAFC 184 at [136] per Allsop J). That proposition was accepted by MEC. 91 Here, in contrast to the position in Rodney Jane, it is the cross-claimants, i.e. the parties seeking cancellation of the Applicant's Mark, who contend that use of that mark before the priority date would be relevant to the s 60 assessment. They do so in the context of a claim that the Applicant's Mark had not acquired a reputation in Australia in clothing prior to the priority date. While this seems to be the converse of what the appellant sought to establish in Rodney ‍Jane, it does not mean that the use or reputation in the Applicant's Mark prior to the priority date would not be relevant. I would not conclude that the claim sought to be made by reason of the proposed amendment at paras 8A and 9 is liable to be struck out. Accordingly, the amendment should be allowed.

The second proposed amendment - para 20(c) 92 The cross-claimants submitted that the amendment by way of inclusion of para 20(c) does not raise a new issue and that, contrary to Ms Taylor's submissions, she has led evidence as to her reputation in the Applicant's Mark after the priority date at [69]-[78] and [115]-[131] of her affidavit. The cross-claimants submitted that, having regard to Ms Taylor's evidence, the issue plainly arises on the evidence led by her. 93 Ms Taylor's submissions in relation to the objection to the inclusion of para 20(c) were made in the context of her objection to category 5 of the respondents'/cross-claimants' discovery application (as to which see below). Ms Taylor submitted that the only ground of cancellation in the Amended Cross-Claim in respect of which the period after the priority date is potentially relevant is the ground reliant on s 88(2)(c) of the TM Act, which is considered as at the date of the cross-claim. She observed that by reason of the inclusion of para 20(c) in the Proposed Further Amended CC, the cross-claimants seek to rely on the extent of her use of, and reputation in, the Applicant's Mark in relation to clothes up to the date of the cross-claim, yet they have adduced no evidence to explain why her reputation in the Applicant's Mark is relevant to their s 88(2)(c) ground of cancellation. Ms Taylor contended that it is not. Ms Taylor submitted that, while she has led some evidence about the circumstances of her use of the Applicants' Mark in respect of clothes after the priority date (at [115]-[131] of her affidavit), that evidence is in summary form and is not apt to assist the Court in reaching any conclusion about reputation. It was led to support para 4 of the FASOC, which is not admitted by the respondents, and to forestall any suggestion that Ms Taylor does not have an ongoing interest in the Applicants' Mark. 94 Ms Taylor submitted that the respondents' proposed amendment by inclusion of para 20(c) "puts the cart before the horse" and that a party cannot make a material allegation of fact in a pleading in the hope that it will later be able to prove it by way of discovery. She contended that the amendment is sought to generate an issue on the pleadings that would render discovery category 5 relevant while, to have a proper basis to plead para 20(c), the respondents need the very documents they seek on discovery by this category. Ms Taylor submitted that, apart from an oblique reference to [115]-[131] of her affidavit, Ms Gourley has not provided any explanation as to the basis on which she would be able to certify para 20(c) of the Proposed Further Amended CC pursuant to r 16.01 of the Rules. 95 In summary, the evidence at [69]-[78] and [115]-[131] of Ms Taylor's affidavit includes the development and growth of Ms Taylor's business commencing in 2008 with a stall at Paddington Markets and expanding to other markets in 2011, her inclusion as a finalist and attendance at a number of fashion events to promote her label including events that she has organised and hosted, the establishment of her website, participation in social media, the establishment of a showroom in Mosman, a suburb of Sydney, the creation of a new logo for the brand, the opening of a store in Paddington, another suburb of Sydney, after returning from living in Perth for approximately one year and, after that store was closed in 2015, the opening of her current showroom in Paddington. 96 Ms Taylor contended that this evidence was led only to support para 4 of the FASOC, in which she contends that since around at least November 2006 she has "designed, marketed, offered for sale and sold clothes or goods of the same description under the brand name 'KATIE PERRY'". That may well be the case but her evidence squarely goes to reputation and the growth of the KATIE PERRY brand (and thus the reputation of the Applicant's Mark) and puts that reputation in issue which, it seems to me, has a role to play in assessing whether the use of the Applicant's Mark as at the date of the cross-claim is likely to deceive or cause confusion. That is because it is an inquiry to be made having regard to the circumstances applying at the time of the filing of the application for rectification which, in this case, is the cross-claim. 97 I would allow the amendment by way of inclusion of para 20(c).

Conclusion on leave to file the Proposed Further Amended CC 98 The cross-claimants should be granted leave to file their cross-claim in the form of the Proposed Further Amended CC.

SHOULD MS TAYLOR BE REQUIRED TO PROVIDE FURTHER DISCOVERY? 99 By prayer 1 of their Interlocutory Application the respondents seek an order requiring Ms Taylor to give discovery in accordance with r 20.16 and r 20.07 of the Rules and produce for inspection by electronic means all documents falling within the seven categories set out in the schedule to the Interlocutory Application. 100 Ms Taylor opposes each of the categories of further discovery sought by the respondents.

Relevant principles 101 Part 20 of the Rules concerns discovery and inspection of documents. 102 Rule 20.11 provides that a party must not apply for an order for discovery unless the making of the order will facilitate the just resolution of the proceeding as quickly, inexpensively and efficiently as possible. Rule 20.15 concerns non-standard and more extensive discovery. It applies where a party seeks discovery by way of categories of documents, as is the case here. 103 In Babscay Pty Ltd v Pitcher Partners (A Firm) [2019] FCA 480 at [94]-[95] Middleton J said the following about the way in which the Court will exercise its discretion to order discovery: 94 As to discovery, the Court can control its extent as it is a discretionary procedure. The discretion must be exercised in a way that best promotes the overarching purpose of the civil practice and procedure provisions set forth in s 37M of the Federal Court Act and the Rules: Power Infrastructure Pty Ltd v Downer EDI Engineering Power Pty Ltd (No 4) [2012] FCA 143 at [14] per Katzmann J. On applications for discovery, the Court has a broad discretion and will balance the costs, time and possible oppression to the producing party against the importance and likely benefits to the applying party: United Salvage Pty Ltd v Louis Dreyfus Armateurs SNC [2006] FCA 116 at [3] per Tamberlin J. If discovery orders are made, they can be tailored to suit the particular circumstances of the case: Taylor v Saloniklis [2013] FCA 679 at [7] per Besanko J. 95 In addition, the party seeking discovery bears the onus of satisfying the Court that the documents sought are necessary: Trade Practices Commission v CC (New South Wales) Pty Ltd (No 4) (1995) 58 FCR 426 at 436 per Lindgren J. If ordering discovery from cross-respondents has "the very real potential to duplicate the discovery already provided by [another party]", the discovery may be oppressive and be refused or limited in operation: BrisConnections Finance Pty Ltd (Receivers and Managers Appointed) v Arup Pty Ltd [2015] FCA 1077 at [60] per Flick J. 104 Ms Taylor referred to the Court's Central Practice Note which, at Pt 10, addresses discovery. In doing so it provides guidance to parties in relation to the Court's approach to discovery and the manner in which the parties should approach applications for discovery. Paragraph 10.6 provides that the Court will not approve expansive or unjustified requests and will generally only consider approving a request for discovery in the circumstances set out. This includes where: the request facilitates the just resolution of the proceeding as quickly, inexpensively and efficiently as possible; the Court and the parties are sufficiently informed of the nature of the case and issues in dispute so that its appropriateness can be properly considered; and the applicant for discovery has adequately justified the need for the request including the relevance and importance of the documents sought, the limited and targeted nature of the request and that the documents sought are, or are very likely to be, significantly probative in nature, or they materially support, or are materially adverse to, any party's case in the proceeding. 105 Bearing those principles in mind, I consider each of the categories of discovery sought by the respondents in turn.

Category 1 106 By category 1 the respondents seek: 1. Documents dated in the period 1 to 31 July 2009 created or sent by any of Ms Taylor, Youth & Enterprise Legal Centre (YELC) and/or Rebecca Stalenberg (Mark Your Territory Pty Limited) recording or evidencing any of: (a) Ms Taylor's withdrawing her instructions with YELC, referred to in paragraph 103 of Ms Taylor's affidavit; and (b) Ms Taylor's reasons for withdrawing her instructions with YELC, referred to in paragraph 103 of Ms Taylor's affidavit. The reference to Ms Taylor's affidavit in category 1 and all other categories of discovery sought by the respondents is to Ms Taylor's affidavit affirmed on 11 June 2021. 107 The respondents seek category 1 because it is said to be relevant to the evidence given by Ms ‍Taylor at [103] of her affidavit where she says that: On 13 July 2009, I withdrew my instructions with YELC because I did not feel as though my rights were properly being protected, and they ceased to act on my behalf. 108 The respondents submitted that Ms Taylor's state of mind is relevant to their defence of acquiescence, laches and delay as pleaded at para 19 of the Amended Defence (and the Proposed Further Amended Defence). In Ms Taylor's reply at para 4 she includes the following: In response to the allegation in paragraph 19 of the Defence: a. that the Applicant encouraged or acquiesced to the Respondents' infringing conduct, the Applicant: i. refers to and repeats the correspondence referred to in particular a to paragraph 9 of the Statement of Claim as if set out in full in this Reply; ii. refers to and repeats particulars a to c to paragraph 14 of the Statement of Claim as if set out in full in this Reply; iii. says that the following without prejudice correspondence was exchanged: 1. letter from Holding Redlich Lawyers on behalf of the Second Respondent to the Applicant on 1 July 2009; 2. letter from Holding Redlich Lawyers to the Applicant on 15 July 2009; 3. letter from Mark Your Territory on behalf of the Applicant to Holding Redlich Lawyers on 15 July 2009; iv. says that no further without prejudice correspondence was sent from the Applicant to the Second Respondent following the 15 July 2009 letter referred to above; v. refers to particulars d to g of paragraph 14 of the Statement of Claim as if set out in full in this Reply; and says in the premises that the Respondents knew that conduct as pleaded in the Statement of Claim was at their own risk and that the Applicant neither encouraged nor acquiesced to such infringement, ... 109 Ms Taylor objects to category 1 on the grounds of relevance and because the correspondence would be subject to a claim for legal professional privilege. She explained that she was initially represented by Chris Hamilton of YELC in respect of her dispute with Ms Hudson and that both Mr Hamilton and Ms Stalenberg were lawyers at the relevant points in time. 110 The respondents submitted that the withdrawal of YELC's instructions is closely temporally connected to the rejection of Holding Redlich's offer of settlement on 15 July 2019 referred to at para 4(a)(iii) of the reply and the contention that no further without prejudice correspondence was sent at para 4(a)(iv) of the reply. 111 I accept that Ms Taylor's state of mind about her legal rights and their protection as at the time she terminated YELC's retainer, which is proximate to 15 July 2019, a date she relies on in her reply, is relevant to the defence of acquiescence, delay and laches. Further, it is Ms Taylor who puts her state of mind in issue by giving her evidence at para 103 of her affidavit. 112 That the documents which are sought by category 1 may be protected from disclosure by legal professional privilege is not a reason why I would decline to order that Ms Taylor provide discovery in this category. The reasons for that are threefold. First, it is not apparent that all of the documents caught by category 1 would be privileged. That Mr Hamilton and Ms Stalenberg are both lawyers is not conclusive of that issue. Secondly, where privilege is claimed over a document, it is protected from disclosure but is still to be discovered in that it is to be listed in the appropriate part of the list of documents. Thirdly, the respondents contended that, in any event, by Ms Taylor's evidence at [103] of her affidavit, she has waived any legal professional privilege in the documents. Ms Taylor denies that is so. Whether there has been a waiver is a question for another day but the contention reinforces my conclusion that the suggestion that all the documents to be produced will likely be privileged is not a reason to refuse to order discovery of category 1.

Category 2 113 By category 2 the respondents seek: Documents dated in the period 1 January 2010 to 31 December 2010 evidencing or recording: (a) the basis for the understanding of Ms Taylor that there was no need for her to contest the Second Respondent's trade mark application no. 1306481, referred to in paragraph 113 of Ms Taylor's affidavit; and (b) the basis for the thoughts of Ms Taylor (expressed in paragraph 114 of her affidavit) being confirmed after [Ms Hudson] dropped class 25 from her trade mark application no. 1306481, as also referred to in paragraph 114 of Ms Taylor's affidavit. 114 Category 2 relates to Ms Taylor's evidence at [113]-[114] of her affidavit where she says: 113. I was aware that the Second Respondent was seeking to register her trade mark in class 25 but that an Adverse Examination Report was issued. I considered filing an opposition or approaching Fisher Adams Kelly about it. However, in 2010, I understood that the Second Respondent withdrew class 25 in her application, and so there was no need for me to contest the Second Respondent's application. 114. I did not at this time, realise that the Second Respondent or any of her related entities was, or was going to, infringe my registered trade mark. I thought that the Second Respondent was a singer and her industry was music and entertainment which I considered to be completely different to mine, i.e. fashion, design and textiles. I did not think, during this period, that she would be marketing, making or selling clothes or other related goods in Australia under KATY PERRY or otherwise. To me, my thoughts were confirmed after finding out that she dropped class 25 in her trade mark application. I was not aware at this time that when the Second Respondent toured, she was selling clothes. 115 The respondents submitted that the documents sought in category 2 are directly relevant to this evidence and that they are entitled to test that evidence. 116 Ms Taylor objects to providing discovery in category 2 on the basis that there is no utility in ordering it. That is because given that she is a sole trader small business it is unlikely that there are business records recording many, if any, of her decisions or her state of mind at points in time because there has been no reason for her to make such records or to communicate her reasoning to others. In addition Dr Silberstein gives evidence that Ms Taylor has informed him that she does not have any documents which would come within category 2. 117 I am satisfied that the documents sought in category 2 are relevant given the evidence at [113]-‍[114] of Ms Taylor's affidavit. That Ms Taylor runs a small business is not a reason for her to be excused from discovery obligations. Further, if after undertaking searches there are no documents to produce, then so be it. That result can be conveyed. Contrary to Ms Taylor's submission, there may well be a forensic purpose in seeking the documents in category 2 despite Dr Silberstein foreshadowing that there will be nothing to produce in that category.

Category 3 118 By category 3 the respondents seek: Documents dated between 1 January 2010 and 3 July 2018 evidencing or recording: (a) any consideration by [Ms Taylor] of bringing proceedings against the Respondents; (b) any consideration by [Ms Taylor] of the resources needed to bring proceedings against the Respondents; and/or (c) the basis for [Ms Taylor], as stated in paragraph 134 of Ms Taylor's affidavit, not considering that "anyone would act for me for free in respect of litigation to sue [Ms Hudson] for trade mark infringement". 119 The respondents submitted that this category goes to Ms Taylor's consideration of bringing proceedings against the respondents, a matter about which she gives evidence at [132]-[138] of her affidavit, which is relevant to the acquiescence, laches and delay defence and to Ms Taylor's reliance on s 89(1)(c) of the TM Act in defence of the application to cancel the Applicant's Mark. The respondents understand that Ms Taylor intends to contend that if the Applicant's Mark has become liable to deceive or cause confusion because of Ms Hudson's reputation in Australia, that is not her fault because she could not have brought proceedings to stop Ms Hudson at any time prior to obtaining litigation funding 120 Ms Taylor objects to category 3 on the basis that there can be no reasonable expectation that she created any documents falling within this category and that the matters referred to by her at [132]-[138] are matters of basic commercial logic: that litigation is expensive, she could not afford expensive litigation and she did not expect that legal counsel would work for free. In addition, Dr Silberstein gives evidence that Ms Taylor has informed him that she has no documents that would come within category 3. 121 Once again I accept that the documents sought by category 3 are relevant to the issues in the proceeding. That Ms Taylor may have no documents that fall within the terms of category 3 is not a reason why the category ought not to be included in an order for discovery. As observed at [117] above if after undertaking a search there are no documents to produce then that result can be conveyed to the respondents in an appropriate manner.

Category 3A 122 By category 3A the respondents seek: (a) All records of advice provided to [Ms Taylor] by Robert Silberstein in the period from 3 July 2018 to 24 October 2019 in relation to pursuing litigation against [Ms Hudson] or persons including [Ms Hudson] with litigation funding, including (but not limited to) litigation funding from LCM Operations Pty Limited. (b) Any litigation funding agreement between [Ms Taylor] and LCM Operations Pty Limited. 123 The respondents submitted that this category of documents is relevant for the same reasons as those in category 3 (see [119] above). 124 Ms Taylor submitted that the documents sought in category 3A(a) would be privileged as the category seeks records of advice given by Dr Silberstein in relation to the anticipated proceedings and accordingly the category should be refused, unless there has been a waiver. Ms Taylor contended that there is no basis to find that there has been a waiver of the privilege in any such advice and that the evidence at [138] of her affidavit does not amount to waiver save in relation to the part of the conversation recorded therein concerning litigation funding. Dr Silberstein gives evidence that, to the best of his recollection, he does not believe that he took a file note or other record of that discussion. 125 Ms Taylor also objects to category 3A(b) because, while the fact of litigation funding is relevant to demonstrate why she did not bring proceedings against the respondents until the time at which she did, the terms by which that funding has been provided to her are not relevant to any issues in dispute. 126 I am satisfied that the documents sought in category 3A(a) are relevant to issues in the proceeding. They go to the issues identified at [119] above. That they are prima facie subject to a claim for legal professional privilege is not a reason not to order discovery of the category. I repeat my comments at [112] above in that regard. Further in this instance Ms Taylor accepts that there has been a waiver of privilege by reason of her evidence at [138] of her affidavit, albeit in a limited way. Whether the waiver goes beyond that admission is an issue to be determined on another occasion and once the documents falling within the category have been identified. 127 Ms Taylor relies on Deep Investments Pty Ltd v Casey (No 1) [2017] FCA 1643 in which the question of whether production of documents was required in answer to a notice to produce where those documents were subject to a claim of legal professional privilege. At [12] Gleeson J observed that an objection to production of the documents on the basis that they are or are likely to be protected by legal professional privilege was a relevant consideration in deciding whether to require production. The objection was met by an argument that any relevant privilege was waived. Her Honour then went on to determine whether there had been a waiver. 128 This application is different to that before the Court in Deep Investments in that it concerns an application for discovery and not production under a notice to produce. Discovery is a two stage process. It requires the party obliged to give discovery: first to provide a list of documents which are discoverable in accordance with Form 38 verified by affidavit and which describes each category of documents in the party's control sufficiently to identify the category but not necessarily the particular document; each document that has been, but is no longer in the party's control, a statement of when the document was last in the party's control and what became of it and each document in the party's control for which privilege from production is claimed and the grounds of the privilege (see r 20.17 of the Rules); and secondly, to make the documents available for inspection. It is generally after the list of documents has been provided that questions such as waiver of legal professional privilege are determined. That is, the party who has obtained the order for discovery is entitled to understand the documents that are discoverable and, of those, the documents which are available for inspection and the documents which are subject to a claim of legal professional privilege, including the basis for the claim, before taking any further steps. 129 I do not reach the same conclusion in relation to the document sought in category 3A(b), namely the litigation funding agreement. I do not accept that the evidence given by Ms Taylor that she was only able to bring the proceeding with the benefit of litigation finding cannot be tested without seeing the terms of the funding agreement. On the contrary, I am not satisfied that the litigation funding agreement itself, as opposed to the fact of funding, is relevant to the proceeding and, to the extent that Ms Taylor's evidence of her means to bring the proceeding absent litigation funding is to be tested, there are other, more apt ways, of ways of doing so.

Category 3B 130 By category 3B the respondents seek the following documents: The database referred to in paragraph 56 of Ms Taylor's affidavit or a list of the over 200 persons on the database referred to in that paragraph identifying when they were first included on the database. 131 Category 3B seeks discovery of the database referred to at [56] of Ms Taylor's affidavit where she relevantly says: As mentioned in that business plan, since 2007, I had accumulated a database of over 200 people. I sent Katie Perry newsletters on a monthly basis to the people on the database. … 132 Ms Taylor submitted that her awareness in 2020 of the database from 2008 stems from the business plan which mentions it and which is an exhibit to her affidavit. She submitted that her evidence does not suggest that she has that database in her possession now or that she consulted it to prepare her affidavit. Relying on Dr Silberstein's evidence, she submitted that, as a matter of fact, she no longer has the database in her possession. To that end, Dr Silberstein deposes that he has been informed by Ms Taylor that she no longer has any documents in category 3B. Ms Taylor submitted that there is no utility in ordering a category of discovery which would not produce any documents and where there is no evidentiary relevance to the absence of documents being produced. She observed that the respondents do not suggest that her evidence is wrong or that there was no such database. 133 Ms Taylor does not appear to reject category 3B on the ground of relevance. However, to the extent that she might, I am satisfied that the category is relevant given first, that she has referred to the database in her evidence; and secondly, because it goes to the question of her reputation before the priority date of the Applicants' Mark (as to which see [89]-[91] above). 134 That Ms Taylor may not have any documents that fall within category 3B is not a reason why I would not order discovery. In that regard I refer to [117] above.

Category 4 135 By category 4 the respondents seek: Documents recording or evidencing the Applicant first becoming aware that KATY PERRY branded clothing merchandise was being advertised or sold in Australia. 136 The respondents submitted that they sought documents in category 4 because Ms Taylor puts squarely in issue the extent and timing of her knowledge (or alleged lack thereof) of Ms Hudson's and Ms Hudson's related entities' marketing and sale of clothes in Australia, referring to [98], [114] and [132] of Ms Taylor's affidavit. 137 Ms Taylor submitted that the evidence she gives at [98], [114] and [132] is about the fact that at certain times in 2009 and 2010 she did not know that Ms Hudson was selling clothes in Australia. She said that she accepts that the time from when she became aware that one or more of the respondents were selling clothes in Australia would be relevant to certain issues in the proceeding. However, she also says that the fact that she can recall not knowing a particular thing at a particular point in time does not mean that she can recall precisely when she did become aware of that particular thing. In any event, she submitted that as a matter of fact, as set out in Dr Silberstein's evidence, she does not recall when she first became aware that the respondents were selling clothes in Australia. 138 Ms Taylor submitted that given this fact, she could not reasonably comply with category 4 because, while she might be able to locate documents in her possession which would evidence that one or more of the respondents was selling clothes in Australia, she would not be in a position to know whether she was aware that one or more the respondents was selling clothes in Australia arising from the document or whether that document evidenced the first occasion on which she became aware of that fact. She submitted that she should not be ordered to give discovery in respect of a category with which she cannot comply. 139 Category 4 suffers from two vices. First, it is difficult sensibly to comply with it and its terms lack precision. The category calls for documents which record or evidence when Ms Taylor first became aware of a particular fact, is not bound by a time frame and requires Ms Taylor to undertake a search for the documents so described. Secondly, it is unlikely to lead to discovery of documents which are of much, if any, utility to the issues in the proceeding. Any documents found after undertaking a search may or may not in fact evidence the first time she became aware of the particular event. In those circumstances I am not satisfied that an order should be made requiring Ms Taylor to give discovery of documents in category 4.

Category 5 140 By category 5 the respondents seek: In relation to Katie Perry clothes advertised or sold in Australia by the Applicant between 1 January 2009 and 19 December 2019, documents recording or evidencing: (a) a description/stock keeping unit for each item of Katie Perry clothes; (b) the quantity and/or value of sales of Katie Perry clothes; and (c) marketing expenditure incurred by the Applicant in relation to Katie Perry clothes. 141 The respondents submitted that this category concerns Ms Taylor's reputation in the Applicant's Mark in relation to clothing. They contended that if the Court accepts that Ms Taylor's reputation both before and after the priority date of the Applicant's Mark is relevant to the s 60 and s 88(2)(c) grounds for cancellation then this category becomes relevant. 142 In addition to the submissions outlined at [93]-[96] above, Ms Taylor submitted that even if the amendment to para 20(c) of the Amended Cross-Claim is allowed, and thus the documents in category 5 become relevant, the category is oppressive because: the relevance of the documents is marginal; the respondents have already sought and obtained discovery of a far more relevant kind to their s 88(2)(c) case, namely category 3 of the categories ordered by the Court on 12 November 2020; and given the nature of her records, as a sole trader small business, it would be an extensive and difficult task for her to locate, collate, review and produce documents falling within this category, as described by Dr Silberstein in his evidence. Further, Ms Taylor submitted that whatever documents could be produced would be unlikely to present a comprehensive and accurate picture throughout the relevant period of her sales and marketing spend which further diminishes the significance and importance of the documents sought to the proceeding. 143 As I have allowed the amendments to the cross-claim, both in relation to the s 60 ground and the s 88(2)(c) grounds of cancellation, it follows that the documents sought by category 5 are relevant. That leaves for consideration whether the category should be refused because it is oppressive. 144 By categories 5(b) and (c) the respondents seek documents of volume and value of sales and marketing expenditure. These are the types of business records which all traders, including sole traders, would be expected to have and to retain for a period. By way of example only, one might expect to find records of total sales and expenses such as marketing expenditure in tax returns. There is no evidence about the volume of material that Ms Taylor would have to review to comply with categories 5(b) and (c) such as to make them oppressive. The evidence is that the "business records" have never been consolidated, "have only ever been kept in a piecemeal fashion and in hard copy with no sophisticated organisation method" and that those documents "have typically been stored away in boxes". That documents do not exist in electronic form and are organised in a haphazard way are not sufficient reasons for me to reject these categories of discovery. Categories 5(b) and (c) should be allowed. 145 I do not reach the same conclusion in relation to category 5(a). That category seeks 10 years of documents recording stock keeping units for every item of Katie Perry clothing. It is not clear how documents of this nature would assist the respondents' case. But, in any event, I accept that given Ms Taylor's method of record keeping and the stated need for her to review all of the patterns she created, production orders and invoices from manufacturers, presumably to identify descriptions and stock keeping units, category 5(a) is oppressive. I will not require discovery of that category.

Conclusion on discovery application 146 Ms Taylor should be required to provide discovery of documents falling within categories 1, 2, 3, 3A(a), 3B and 5(b) and (c) of the schedule to the Interlocutory Application.

conclusion 147 It follows from the matters set out above that leave should be granted to the respondents to file the Proposed Further Amended Defence and to the cross-claimants to file the Proposed Further Amended CC. The respondents/cross-claimants should pay the costs thrown away by reason of the filing of those amended pleadings. 148 Ms Taylor should be ordered to provide discovery in categories 1, 2, 3A(a), 3B and 5(b) and (c) of the Schedule to the Interlocutory Application. I will leave it to the parties to agree the time by which Ms Taylor will provide the discovery. If the parties cannot agree on a date they have liberty to apply to have the matter relisted. 149 As the respondents/cross-claimants have been substantially successful, they should have their costs of the Interlocutory Application. If Ms Taylor wishes to seek an alternative order she may do so within seven days of the date of publication of these reasons by the filing of submissions not exceeding two pages in length. If no such submissions are filed, an order that Ms Taylor pay the respondents'/cross-claimants' costs of the Interlocutory Application will be made. If submissions are filed and the parties are not agreed as to the alternate order sought by Ms Taylor, the respondents/cross-claimants should file any submission in reply, not exceeding two pages in length, within seven days thereafter. If submissions are filed by both parties, I will inform the parties of the costs order to be made in relation to the Interlocutory Application on the next occasion that the proceeding is listed before me. 150 I will make orders accordingly. I certify that the preceding one hundred and fifty (150) numbered paragraphs are a true copy of the Reasons for Judgment of the Honourable Justice Markovic.

SCHEDULE OF PARTIES NSD 1774 of 2019 Respondents Fourth Respondent: PURRFECT VENTURES LLC Cross-Claimants Second Cross-Claimant: KATHERYN ELIZABETH HUDSON