2025

Is there a Lenah Game Meats constructive trust?

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The short answer is: not in this case in which Snaden J awarded The Game Meats Company $130,000 damages against Farm Transparency International for trespass but rejected Game Meats’ claim to a Lenah Game Meats constructive trust over the copyright in videos made by Farm Transparency during the trespass. The case also challenges whether the victim of the trespass can get an injunction against communicating the fruits of the trespass.

What happened

Game Meats operates abattoirs, including a halal abattoir at Eurobin.

Farm Transparency is a not-for-profit charity dedicated to educating the public about animal exploitation and the prevention of cruelty to animals.

As one of its directors, Mr Delforce, put it, Farm Transparency’s overarching wish is to “…end all forms of business that involve causing harm to animals”.

To that end, Ms McDonald-Eckersall, its Strategy and Campaigns Director, developed Farm Transparency’s “Shut Down Slaughterhouses” campaign.[1] As part of this campaign, between January and April 2024, Farm Transparency operatives (including Mr Delforce and Ms McDonald-Eckersall) broke into the Eurobin abattoir and installed video cameras to record the animal slaughtering process.

In May 2024, Farm Transparency provided some of the footage from those cameras to the Commonwealth Department of Agriculture as part of a complaint about the nature of Game Meats’ operations.

A few days later, Farm Transparency provided 14 minutes of the footage to Channel 7 which broadcast a story on its Albury station, but without the footage. Farm Transparency also posted the 14 minutes of footage with commentary on its Facebook page and on its website with a press release.

Game Meats obtained injunctions ex parte against the continued publication of these materials. Game Meats then sought injunctions and exemplary damages for trespass, injunctions and damages for contraventions of the prohibitions on misleading or deceptive conduct or the tort of injurious falsehood and, finally, it sought a declaration that a constructive trust arose over the copyright in the footage obtained through the trespass.

The decision

By the time of the trial, Farm Transparency admitted liability for trespass and Snaden J ordered damages totalling $130,000 ($30,000 damages and $100,000 in exemplary damages) for the trespass.

Snaden J, however, dismissed the claims for injurious falsehood, misleading or deceptive conduct and for beneficial ownership of the copyright in the footage as a cinematograph film.

The Lenah Game Meats constructive trust

Lenah Game Meats is authority for the principle that an interlocutory injunction cannot be granted except for the protection of some legal or equitable right or interest.

Similarly to the present case, Lenah Game Meats involved an attempt to stop the broadcasting of footage of the operations of the abattoir obtained through unlawful trespassing.[2] In the course of their reasons, Gummow and Hayne JJ said in obiter at [102] (with the individual agreement of Crennan and Callinan JJ):

A cinematograph film may have been made, as in Lincoln Hunt, in circumstances involving the invasion of the legal or equitable rights of the plaintiff or a breach of the obligations of the maker to the plaintiff. It may then be inequitable and against good conscience for the maker to assert ownership of the copyright against the plaintiff and to broadcast the film. The maker may be regarded as a constructive trustee of an item of personal (albeit intangible) property, namely the copyright conferred by s 98 of the Copyright Act. ….

Snaden J noted, therefore, that whether or not a constructive trust would arise depended very much on the particular facts of the particular case.

His Honour noted that, after Lenah Game Meats, Hall J had refused to find a constructive trust arose of footage and photographs taken by trespassers in Windridge Farm Pty Ltd v Grassi.

In Windridge Farm, Hall J found that the trespassers did not intend to use the footage for publication (but to facilitate an investigation) and there was no evidence of damage resulting from their conduct. At [129], Hall J said:

Apart from the unlawfulness of the entry onto the premises by the defendants, the evidence does not establish the type of circumstances to which Gummow and Hayne JJ in Lenah] adverted. These circumstances include matters which constitute either an invasion of the legal or equitable rights (such as the right to confidentiality) of the owner or occupier of premises or facts that establish a breach of any equitable obligation operating between (in this case) the plaintiff and the defendants at the time the film and the photographs were made or taken.

First, at [174] – [175] Snaden J rejected breach of confidence as a basis for intervention. While breach of confidence could be invoked to restrain the publication of confidential information “improperly or surreptitiously obtained”,[3] Game Meats had not submitted what was depicted in the footage was confidential nor could it realistically do so.[4]

Next, Snaden J considered there might be situations where how the footage had been obtained (his Honour’s emphasis) could give rise to a sufficient equity. At [177], his Honour explained:

But for the absence of authority, I would have been disposed to the view that it should. For the best part of two centuries, courts of equity have been prepared to grant relief against defendants possessed of information obtained by reason of “…a breach of trust, confidence or contract”: Prince Albert v Strange (1849) 1 Mac & G 25; 41 ER 1171, 1178 (Cottenham LC). The fact that information has been obtained through the commission of a crime or tort might not, by itself, suffice to warrant equivalent relief: Lenah, 230–1 [55] (Gleeson CJ); Smethurst v Commissioner of the Australian Federal Police (2020) 272 CLR 177 (“Smethurst”), 219–20 [94] (Kiefel CJ, Bell and Keane JJ). But there is, in my view, much to commend the submission that, subject to discretionary considerations, equity might intervene to grant relief in relation to information that is directly obtained:

(1) as the intended consequence of wrongful conduct; and

(2) for the purposes of using it to visit prejudice upon the victim against whom that conduct was carried out.

For a respondent to realise the benefit that was intended to materialise from conduct of that kind would, I think, aptly be described as unconscionable (or unconscientious: see Lenah, 244–5 [98] (Gummow and Hayne JJ)).

However, Snaden J held that this was not a case where a constructive trust arose.

First, at [179], Snaden J noted that obtaining the footage through trespass had not been sufficient in Windridge and Smethurst. While the absence in Windridge of a purpose to shame or damage the abattoir was a difference to the present case, it was not sufficient. At [180], his Honour concluded:

…. The court should, I think, be very slow to favour a result that deviates from what transpired in those cases in the absence of some clearly apparent distinguishing feature or features.

Secondly, Snaden J was influenced at [181] by the absence of precedent recognising the proposed constructive trust. It was not appropriate for a judge at first instance to indulge “in the kind of ‘bold step’ that trial judges should ordinarily leave for higher consideration”.

Injurious falsehood and misleading or deceptive conduct

The claims for injurious falsehood and misleading or deceptive conduct failed because Snaden J found that the publications did not falsely represent that Game Meats condoned animal cruelty or was systematically cruel to the animals it slaughtered at the abattoir.

The injurious falsehood claim failed for the further reason that Farm Transparency did not make the representations in the publications maliciously. Snaden J accepted that there was no element of personal spite against Game Meats. However, his Honour rejected Farm Transparency’s claim that it did not intend harm to Game Meats. On the contrary, Farm Transparency’s very objective was to shame Game Meats and reduce custom for its products by exposing its production practices.

Even so, this was not enough – the intention to injure had to be without just cause. And that was not the case. At [131], his Honour explained:

The making of each of the Three Publications was effected to further the political ends to which FTI is committed. Whatever might be said of those ends, they cannot be impugned as unjust or improper in any sense recognised by law. It is a feature of societies the world over—and liberal democratic societies in particular—that people with shared ideological, religious, commercial or other values will group together with a view to spreading them or having them lawfully imposed upon others. That reality does not bespeak relevant injustice or impropriety.

Game Meats’ claims would also have run into difficulties proving it had suffered damage. Partly because of the state of its evidence, partly because of the speed with which the trial was brought on including the swift court action to secure interlocutory injunctions and partly because Farm Transparency had undertaken that it would not restore the footage to public view until final determination of the proceeding.

What happened to the injunction

The claims of copyright and injurious falsehood having failed, Game Meats sought an injunction to restrain Farm Transparency from publishing the footage obtained through the trespass. Game Meats argued this was necessary to prevent Farm Transparency from realising the benefits of its trespassing.

The interlocutory injunction was dissolved and no further injunction was granted!

Citing Patrick Stevedores at [33], Snaden J accepted that an injunction might be granted where the damage caused by tortious conduct is ongoing and is “extreme or at all events very serious”.

His Honour noted that Gageler, Gordon and Edelman JJ in Smethhurst had considered the invasion of Ms Smethurst’s privacy provided a sufficient interest for an injunction requiring the police to return her phone and the data it held. The police had seized the phone by executing a search warrant which was subsequently found to be invalid and so committed trespass. However, their Honours were in the minority.

At [204] – [206], Snaden J observed that the majority in Smethhurst, Kiefel CJ, Bell, Keane and Nettle JJ, accepted an injunction could be awarded where the trespass was completed only if its effects were serious and ongoing. Kiefel CJ, Bell and Keane JJ in particular had ruled the trespass did not support an injunction and there was no other right to be vindicated:

The public interest in both the investigation and the prosecution of crime would not suggest as appropriate an order that the information be taken from the [Australian Federal Police (“AFP”)] and given to the plaintiffs. The prospect that criminal conduct may be disclosed is a sufficient reason to decline the relief sought.

In the present case, the acts of trespass – at least as against the Eurobin premises – were well and truly completed although Snaden J considered it was very likely Farm Transparency would engage in similar acts against other premises.

On that basis, his Honour held that further acts of publishing the footage could not be characterised as continuations of the original trespass. And further, his Honour considered Game Meats could not establish the consequences of such publication(s) would be sufficiently serious.

As to the first point, his Honour accepted Farm Transparency’s submission:

It is correct to observe that obtaining of the footage was made possible by the trespass. However, once trespassing, the respondent did not commit any further breach of the law by filming what was there to be observed nor invade any further rights of the applicant. The respondent was not an outlaw whilst trespassing. The law treats the acts of trespass, and filming (even if whilst a trespasser), as distinct and not interrelated. One cannot slide as between those two separate matters, despite them arising from the same factual matrix.

At [214], Snaden J accepted that submission and explained at [215]:

There is a distinction that must be drawn between the commission of the tort—that is to say, the unauthorised entrance by FTI’s agents onto the Eurobin Premises and the installation there of the covert recording equipment that was thereupon installed—and the publishing of information obtained as a result thereof. The latter involves no interference with any legal right that GMC possesses and is not, in and of itself, tortious. The injury that inheres to GMC’s prejudice as a result of the trespasses is, at most, FTI’s possession of the footage; not its publication. (original emphasis)

At [216], Snaden J illustrated his proposition with the analogy that an injunction could not be granted against Mr Delforce or Ms McDonald-Eckersall to stop them telling others what they had seen during their trespasses.

In addition, Snaden J considered Game Meats could not show its injury from further publication would be sufficiently serious. At [214], his Honour explained:

…. If FTI were to publish the footage that it obtained as the fruit of its unlawful trespass, the consequences for GMC are difficult to pinpoint. I would accept, at a level of generality, that they would unlikely be positive. But the extent to which they might sound in immeasurable or extreme damage to GMC’s goodwill would depend on all manner of circumstances, not the least being the manner in which GMC sought to counter any public backlash. I do not consider it possible to conclude that the damage to GMC’s goodwill would be so significant as to clear the hurdle that needs to be cleared.

So, apart from the damages award, Farm Transparency is free to use the fruits of its trespassing with, it appears, impunity.

As a final point, although it was unnecessary to his decision, Snaden J noted he would have rejected Farm Transparency’s argument that its continued use of the footage was protected by the implied constitutional freedom of expression about matters of politics or government.

It might be questioned how allowing a trespasser to continue using the fruits of their trespassing promotes the objectives of the civil prohition on committing a trespass. This appears to be recognised by his Honour’s reaction at [177] “in the absence of authority”. Even so, one might wonder, with respect, whether telling someone what one had seen is comparable in nature and impact to showing a video. One might also wonder whether acts of unrestricted publication are comparable to disclosure to authorities or use in an investigation.

There’s an appeal

Game Meats and Farm Transparency have both appealed (VID 92/2025).

The Game Meats Company of Australia v Farm Transparency International Ltd [2024] FCA 1455 (Snaden J)

  1. Ms McDonald-Eckersall had previously achieved fame, or notoriety, through the Animal Rebellion campaign which disrupted McDonald’s national supply chain in the UK “costing the company millions”.  ?
  2. Snaden J noted that the injunction rejected by the High Court in Lenah Game Meats was an injunction against the broadcaster. However, the interlocutory injunction against the trespassers themselves was left undisturbed (because they did not appeal).  ?
  3. Citing Gleeson CJ at [34] in Lenah Game Meats.  ?
  4. This conclusion seems to be reinforced by the High Court’s ruling in Lenah Game Meats and the subsequent decision Farm Transparency International Ltd v New South Wales [2022] HCA 23; 277 CLR 537 at [41]; a case involving an unsuccessful challenge to the constitutional validity of sections 11 and 12 of the Surveillance Devices Act 2007 (NSW).  ?

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Zipped: Firstmac v Zip Co

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Firstmac has won its appeal and the Zip Co companies have been found to infringe Firstmac’s ZIP registered trade mark.

For obvious reasons, this is just going to be a fairly bald summary.

Infringement

First, the Full Court held that Zip Co’s formative ZIP marks such as ZIP PAY, ZIP MONEY and:

were deceptively similar to Firstmac’s ZIP trade mark.

The honest concurrent user defence

Secondly, the Full Court held that Zip Co companies were not honest concurrent users for the purposes of section 44(3)and so the defence based on sections 122(1)(f) and (fa) failed. On this point, the Full Court emphasised that the onus was on Zip Co to establish it was an honest concurrent user; not on Firstmac to prove it was not.

The reasons for the failure of the honest concurrent user defence also meant that Zip Co could not rely on the defence under section 122(1)(a) for use in good faith of its own name.

Cancellation because Firstmac’s mark had become deceptive

Thirdly, the Full Court accepted that as a result of Zip Co’s reputation, the use of ZIP by Firstmac would be deceptive or confusing for the purposes of section 88(2)(c). The Full Court, however, exercised the discretion under section 89 and refused to order cancellation.

This case is the reverse of the Katy Perry case.[1] Both Full Courts did reject reliance on the old law “blameworhy” conduct cases in applying section 88 and considered that “blameworthy” conduct was one, but not the only, consideration to be taken into account in the exercise of the discretion under section 89.

In the Katy Perry case, the (differently constituted) Full Court found that Ms Taylor knew of Ms Hudson’s reputation as Katy Perry and that artists such as Ms Hudson exploited their celebrity through the sale of branded merchandise such as t-shirts and the like. Consequently, in applying for her trade mark with that knowledge, Ms Taylor was precluded from relying on section 89. For example, the Full Court said at [317]:

We consider that Ms Taylor’s act of filing the trade mark application with knowledge of Ms Hudson, her reputation, and her mark in circumstances where she also knew that popular music stars, such as Ms Hudson, lend their names (and trade marks) to be used in connection with clothes and sell merchandise at their concerts, and accepted such conduct as a common practice, is sufficient not to enliven the discretion under s 89.

See also at [342] – [343].

In contrast, Firstmac was not infected with such knowledge when it registered its trade mark; the Zip buy now pay later business not even being in existence at that time. At [175], the Full Court explained:

… where, as here, the primary judge found that Firstmac was without fault, and we have found that the respondents did not prove that their use of the Firstmac Mark was honest, to exercise the discretion to remove the Firstmac Mark would reward “the assiduous efforts of a misappropriating user”. To pick up on what Brennan J said in Murray Goulburn at 389, it would place a premium on those efforts.

The Full Court also examined the other mandatory considerations prescribed under section 89(2).

Removal for non-use

Fourthly, the Full Court held that Firstmac had proved use of its trade mark through advertising and promotion of its re-launched product such as:

Accordingly, Firstmac had satisfied its burden under section 100(1)(c) to defeat Zip Co’s action for non-use.

Firstmac Limited v Zip Co Limited [2025] FCAFC 30 (Perram, Katzmann and Bromwich JJ)

  1. Killer Queen, LLC v Taylor [2024] FCAFC 149; 306 FCR 199 (Yates, Burley and Rofe JJ). ?

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Cantarella lost its appeal and the ORO trade mark

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The fallout from the High Court’s ruling that ORO is distinctive for coffee continues. In round 2 of the ORO trade mark saga (Lavazza edition), Cantarella has lost its appeal from Yates J’s ruling to expunge its ORO trade marks.

The tantalising issue of the relationship between s 58 (ownership) and honest concurrent use, however, has been left dangling.

A recap

Cantarella owns two registered trade marks for ORO in Australia in respect of coffee. TM 829098 and TM 1583290.

The earlier of the two, the 098 mark, was filed on 24 March 2000. However, Cantarella’s evidence was that it first began using ORO as a trade mark for its coffee products “at least” from 20 August 1996.

Having successfully sued Modena and fended off the ownership and distinctiveness challenges to its registrations, Cantarella sued Lavazza for infringement of these trade marks by selling in Australia LAVAZZA qualità ORO coffee in packaging such as:

Four images of packaging for coffee showing the trade marks "Caffè Molinari" and ORO

At trial, Yates J found this packaging involved use of ORO as a trade mark but did not infringe Cantarella’s trade marks because they were invalidly registered as Cantarella was not the owner:

The registration of a trade mark may be opposed on the ground that the applicant is not the owner of the trade mark.

Who used the trade mark first

The key fight in the appeal, as at trial, was whether Caffè Molinari’s products had used “ORO” as a trade mark in Australia before Cantarella’s first use on 20 August 1996.

In the Modena case,[1] evidence from Molinari’s senior executive only showed use after that date. In this case, however, Yates J accepted evidence from two different Molinari employees and two witnesses from CMS / Saeco that CMS / Saeco, a coffee business in Coburg Victoria, had in fact imported shipments of the Molinari product before Cantarella’s first use. So, in contrast to the Modena case, Cantarella was not the owner of the trade mark ORO in Australia[2] and its trade marks were invalidly registered.

For the most part, this conclusion turned on Yates J’s assessment of the creditworthiness of the witnesses which, despite some question marks, the Full Court considered it was not appropriate to disturb.

The Full Court rejected Cantarella’s argument that the finding about the date of Molinari’s first use in Modena was conclusive. It was a factor, but needed to be weighed in the balance with all the other relevant evidence.

Cantarella attacked the evidence from the Molinari witnesses who advanced data from Molinari’s records and set out in Excel spreadsheets. The issue here was that the invoices and shipping documents were no longer available for the sales before the priority date of Cantarella’s use. One of the Molinari witnesses also admitted that the spreadsheet might record “pro forma” invoices. Apparently, these were what we might call quotes, sent to customers and which only became sales if the customers accepted them. The Molinari witnesses were unable to say whether the relevant entries were sales or “pro forma” invoices.

The Full Court, however, pointed out that “pro forma” invoices of this kind would still count as use of the trade mark as offers to sell. (Also, there was the evidence of the CMS / Saeco witnesses that orders were placed and product in the packaging was received.)

Did Molinari use ORO as a trade mark in Australia

Next, Cantarella challenged Yates J’s ruling that ORO was used as a trade mark on the Molinari 3 kg packaging:

Close up views showing "Miscela di Caffè" in small type and ORO underneath but in much larger type.
Molinari’s Miscela Di Caffè ORO composite usage

Cantarella argued that this was use only of a composite mark “Miscela di Caffè ORO”.

As with the finding about when Molinari first used ORO in Australia, Cantarella was unsuccessful in challenging Yates J’s acceptance of the evidence that Molinari’s 3kg packaging in 1995 and 1996 took the form of the 2007 packaging.

On that basis, the Full Court dismissed Cantarella’s appeal on this ground, explaining at [93]:

We have had regard to the primary judge’s finding, applying Modena, that the word ORO is inherently distinctive and capable of acting as a badge of origin when used in relation to coffee. We have had regard to the prominence given to the word ORO both in the context of the packaging as a whole, and relative to the words MISCELA DI CAFFÈ in the much smaller font. We have also had regard to the appearance of what Cantarella calls the composite expression as it appears on both the front and back of the 3kg packaging, where the relevant words are differently arranged. In each case the word ORO appears much more prominently than the words MISCELA DI CAFFÈ. We consider the word ORO simpliciter acts as a badge of origin. We therefore agree with the primary judge’s finding on this topic.

Use as part of a composite mark

To succeed on the s 58 ground, Lavazza had to show not just that Molinari was the first user of ORO as a trade mark in Australia, but also that it had used it continuously and not abandoned it.

During the Modena litigation, howeve, Molinari had changed its packaging to use the expression “QUALITÀ ORO” – which Cantarella had not challenged. Thus, the evidence showed a progression of uses:

Caffè Molinari’s QUALITA ORO branding vs the Miscela di Caffè ORO branding

Cantarella contended these were use of the composite mark “QUALITÀ ORO” only, not ORO alone.

Lavazza did not try to argue that “QUALITÀ ORO” was substantially identical to ORO (and so might invoke s 7(1)).[3] Rather, it argued these later forms of packaging were use of ORO itself.

At [113], the Full Court explained:

The fact that the mark in question may appear as a component of a larger mark does not preclude a finding that it has been used as a trade mark. Whether or not there has been such use will depend on the circumstances and the overall impression conveyed.

Then, the Full Court accepted Molinari had used ORO itself as a trade mark in the later forms of packaging. Their Honours noted this depended on matters of impression about which minds might reasonably differ but “on balance” agreed with Yates J’s finding explaining at [114]:

In the case of both the 6077 and 6021A/6021E products, the word ORO is given prominence by the use of a larger font and, in the case of 6021A/6021E, ORO occupies a central position on the pack separated from the word QUALITÀ by the horizontal line immediately above the word ORO. We also note that the word ORO is given prominence across the relevant product range including on packaged coffee products 1525E, 6091 (as depicted in J [201], being the December 2003 1kg packaging) and 6071. The use across the range is consistent with the use of ORO as a sub-brand within the Molinari range of packaged coffee.

No exercise of the discretion against removal

The Full Court then rejected Cantarella’s appeal from Yates J’s refusal to exercise the discretion under s 88 not to remove the registrations.

At [141], the Full Court recorded the long established proposition that, once a ground for cancellation is established, the registration should be cancelled unless sufficient reason appears for leaving it on the Register. The trade mark owner having the onus to show sufficient reason.

As this was a discretionary judgment, this required Cantarella to show legal error. The Full Court considered Cantarella failed to demonstrate any error and so this ground failed.

The main reason advanced by Cantarella was its reputation arising from its long use. However, the Full Court at [148] agreed with Yates J that this was not a matter of significant weight.

Assuming Cantarella had a strong reputation, it still retained the ability to prevent misrepresentation through passing off and the prohibition on misleading or deceptive conduct. And so, there was no compelling necessity for the marks to remain on the Register.

The unresolved issue

Cantarella sought to argue for the first time on appeal that it should be considered a joint owner of ORO at common law as a result of its long use as an honest concurrent user.

That is, Cantarella sought to throw into question the relationship between s 58 and s 44(3).

In McCormick, Kenny J had ruled that the new “plain English” version of the Act which put “honest concurrent user” in Part 4 of the Act dealing with grounds of rejection and “ownership” in Part 5 dealing with grounds of opposition meant that s 58 was in effect in a separate sphere from honest concurrent user and independent and superior to that ground. So that, even if an applicant established it was an honest concurrent user, it still could not be validly registered in the face of a successful s 58 opposition.

The Full Court refused leave for Cantarella to argue this for the first time on appeal.[4] At [134], however, their Honours did say:

The preferable solution to this difficulty may be to read s 58 and s 44(3) together to form a harmonious legislative scheme in which s 58 is read subject to s 44(3): Project Blue Sky Inc v Australian Broadcasting Authority (1998) 194 CLR 355 at [69] – [71] per McHugh, Gummow, Kirby and Hayne JJ citing (inter alia) Ross v The Queen (1979) 141 CLR 432 at 440 per Gibbs J. That would involve recognising that s 58 does not apply in the circumstances where s 44(3) has been satisfied. But it is not necessary to resolve this issue in the present case because even if s 58 operates subject to s 44(3), the requirements of s 44(3) were not shown to have been met in this case. (emphasis supplied)

The problem for Cantarella was that it had not led any evidence explaining how it had come to adopt ORO and so of honest concurrent user would not be available.

I guess we shall have to wait and see whether a special leave application is forthcoming and, if it does, its fate.

Cantarella Bros Pty Ltd v Lavazza Australia Pty Ltd [2025] FCAFC 12 {Nicholas, Jackson and Rofe JJ)

  1. Modena was Molinari’s exclusive distributor in Australia. The High Court’s decision, of course, laid down the law in Australia to determine when a mark has no inherent capacity to distinguish and held ORO was inherently distinctive for coffee. Consequently, Modena’s defence to infringement failed.  ?
  2. The owner being the first person either to use the mark in Australia as a trade mark for the relevant goods or services or to apply to register it with the intention of using it as a trade mark here: Re Hicks’s Trade Mark (1897) 22 VLR 636 at 640; Food Channel Network Pty Ltd v Television Food Network GP (2010) 185 FCR 9 (Keane CJ, Stone and Jagot JJ) at [49] – [55], Pham Global Pty Ltd v Insight Clinical Imaging Pty Ltd (2017) 251 FCR 379 (Greenwood, Jagot and Beach JJ) at [18] – [19].  ?
  3. If the Registrar or a prescribed court, having regard to the circumstances of a particular case, thinks fit, the Registrar or the court may decide that a person has used a trade mark if it is established that the person has used the trade mark with additions or alterations that do not substantially affect the identity of the trade mark.  ?
  4. In fact, the issue was raised in obiter dicta by Yates J at [647] – [649].  ?

Cantarella lost its appeal and the ORO trade mark Read More »

Aldi’s ‘benchmarking’ strategy

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Moshinsky J has held that the packaging for three of Aldi’s Mamia Baby Puffs products infringed Hampden’s copyright in the packaging for Little Bellies Puffs products. However, the packaging in another eight of Aldi’s Mamia products did not infringe the copyright in the packaging for various Baby Bellies products. Moshinsky J also held that Aldi was liable for additional damages for the proven infringements in light of Aldi’s ‘benchmarking’ strategy.

There was also an issue about ownership.

Illustration of the infringing packaging

Illustration of the non-infringing packaging

Some of the background

As you no doubt know, Aldi stores largely carry private label brands (i.e., Aldi’s own in-house brands). One of its private label brands is the Mamia range of baby products.[1]

In 2018, Aldi had embarked on a redesign of the packaging for the products in this range, starting with nappies and wipes.

In 2019, Aldi had moved on to the packaging for its snacking range. As part of this exercise, Aldi identified Hampden’s Little Bellies as the market leader. This led to Aldi instructing its design contractor, Motor Design:

Snacking range architecture needs to follow Baby Bellies with real photography.

This led, in 2020, to Aldi commencing to sell a number of Mamia food products – two varieties of Rice Cakes, three varieties of Fruit Snack Cereal Bars and three varieties of Fruit & Oat Bars.

In July 2020, Aldi also decided to introduce baby puffs products into its Mamia range. As with the earlier snacking products, Aldi identified and used the Bellies puffs products as the reference or benchmark products. Aldi launched three puffs products in August 2021. (It appears the packaging design went through at least 6 versions.)

The Puffs packaging

As noted above, Moshinsky J found that Aldi’s packaging for the blueberry, apple and cinnamon and carrot puffs infringed the copyright in Hampden’s corresponding Baby Bellies products.

The packaging for the blueberry puffs products illustrates this:

At [180], Moshinsky J found Aldi’s packaging reproduced the following layout and design elements of the Baby Bellies packaging:

(a) a small, oval-shaped cartoon character, with a large, light-coloured belly;

(b) a solid white background;

(c) a two-column layout;

(d) a rounded, childlike font;

(e) on the left side, text elements of varying sizes, “stacked” vertically;

(f) on the right side, photographic images of the product and ingredients, in a vertical composition; and

(g) a number in the upper-right corner.

His Honour considered at [181] that the combination of these elements cumulatively involved a degree of creativity or originality and, considered together, were qualitatively significant.

In so finding, Moshinsky J rejected Aldi’s argument that Hampden was seeking to protect the idea or ‘look and feel’. His Honour accepted at [183] that the elements were not taken precisely by Aldi but, nonetheless, all were present in Aldi’s packaging:

Aldi’s characterisation of the applicants’ claim as residing in the ‘look and feel’ of the Applicants’ Works rested on a submission that none of the listed design elements was taken ‘precisely’ by Aldi. I do not accept that submission. Each element listed above is present in item 9 of the Impugned Works. It is true that the identification of those elements involves some degree of abstraction, but the elements are not identified at so high a level of abstraction as to venture into the protection of ideas rather than their expression.

And, at [184], his Honour pointed out that focusing on the differences was contrary to Designer Guild where Lord Hoffmann had stated:[2]

…. In the present case, [the question] is whether the features which the judge found to have been copied from Ixia formed a substantial part of Ixia as an artistic work. That is certainly a question of judgment or impression. But why, in answering that question, should it be relevant to consider whether Ixia did or did not look like Marguerite?

The non-Puffs packaging

In contrast to the findings in relation to the puffs packaging, Moshinksy J held that the packaging for the other products did not reproduce a substantial part of the copyright in Hampden’s Little Bellies products.

For example, the Mamia rice cakes products did not infringe the copyright in either the Baby Bellies blueberry puffs or the Little Bellies products

The Mamia rice cakes products reproduced the layout and design elements of:

(a) a solid white background;

(b) a rounded, childlike font;

(c) on the bottom left, a green oblong shape with writing in it;

(d) on the right side, photographic images of the product and ingredients, in a vertical composition; and

(e) a number in the upper-right corner.

Unlike the puffs packaging, however, at [198] Moshinsky J considered what had been taken was not a substantial part of the copyright. Even in combination, they did not produce something of sufficient creative significance.

At [197], his Honour had earlier drawn attention to significant differences in the Aldi design:

Unlike the Impugned Puffs Works, items 1 and 2 of the Impugned Works do not reproduce the design element of a small, oval-shaped cartoon character. The owl in items 1 and 2 of the Impugned Works is much larger, and does not resemble the cartoon character in item 1 of the Applicants’ Works. While it might be said that a large, light-coloured belly (with writing in it) has been reproduced, I do not consider that this can be considered separately from the character itself, which is not reproduced. Further, unlike the Impugned Puffs Works, items 1 and 2 of the Impugned Works do not reproduce a two-column layout. The ingredients near the bottom of the image stray into the middle of the work, and the MAMIA brand name is central, such that there is not a clear impression of two columns.

Turning to consideration of Hampden’s non-puff packaging:

Moshinsky J noted that the competing designs did both feature a large, oval-shaped cartoon character with a large, light coloured belly but Aldi’s design did not feature photographic images of the products in a vertical arrangment on the right side of the work.

At [203], Moshinsky J considered that the number of design elements that had been reproduced was too few to conclude that a substantial part of Hampden’s copyright had been reproduced:

…. Although the impugned work reproduces the design element constituted by a large, oval-shaped cartoon character, with a large, light-coloured belly (with writing in it), which may be considered to be a creative or original element, the other elements that have been reproduced are commonplace. While the question is to be approached qualitatively, the number of layout and design elements that have been reproduced can be relevant to the qualitative assessment. Here, the number of elements that have been reproduced is too few to conclude that the layout and design elements that have been reproduced, even if taken together, constitute a substantial part of item 2 of the Applicants’ Works.

Additional damages

As noted above, Moshinsky J found that it was appropriate to order additional damages against Aldi under s 115(4) in respect of the infringements. The infringements were flagrant and there was a need to deter similar infringements.

Aldi directed Modern Design to use the Hampden products as the benchmark products and both the Aldi personnel responsible for the range and the Modern Design personnel had referred closely to Hampden’s designs.

In her affidavit, Aldi’s witness had attempted to explain what Aldi meant by ‘benchmarking’:

… development of a Private Label product (or rebranding an existing Private Label product) also involves consideration of the packaging used by competitors. As part of this process a benchmark product is usually identified within the market. This is a product selected by Aldi or the Agency from amongst the range of on-trend products within an on-trend category which have been identified during the market investigation process I have described above. The purpose of the benchmark is to enable us to identify cues that customers may associate with the product type generally and then adapt them to develop the Aldi Private Label product. These cues can include:

(a) the packaging size;

(b) the use of colours known to relate to quality or characteristics – for example, purple is used for salt and vinegar flavours; and

(c) the presentation of aspects of packaging such as product name and key ingredients, and also the expected age range for consumers of the product.

(Moshinsky J’s emphasis).

Things did not improve in her cross-examination.

At [128], Moshinsky J found that he had difficulty accepting the witness’ evidence. Rather, his Honour inferred that ‘benchmarking’ meant:

a process of developing a packaging design that resembled the packaging of the benchmark product (albeit not too closely, because that would infringe the law).

It is also worth noting that Aldi’s legal advice had been that version 4 of the puffs packaging was too close to the Bellies packaging. The internal comment by Modern Design’s designer was “No shit”.

Aldi considered that a further design removing text from the owl’s tummy and amending that wording “should now move it far enough away from the benchmark”.

At [231], Moshinsky J found that Aldi had used the designs which had been developed by a trade rival for its own advantage. It took the risk that its use would exceed what the law allows. Consequently, Moshinsky J found Aldi’s conduct to be flagrant. In addition, Aldi continued selling the products in the infringing packaging after receipt of Hampden’s letter of demand.

An owership issue

Hampden, as its name might suggest, is an IP holding company. Its related company, Every Bite Counts (EBC), had arranged for B&B Studio to design the packaging for nine of the Bellies products in 2017 / 2018.

It also appears that B&B Studio prepared drafts or versions of four other packaging designs. These were sent to another company, Lacorium, where a Mr Mota amended or revised these to produce the final packaging designs for these four products.

Moshinsky J (at [144]) held that the terms of the B&B Studio assignment to Hampden that copyright “shall be assigned” on payment in full of the contract price were effective to assign copyright to EBC once the payment was made.

Aldi argued that “shall be assigned” was in effect an agreement that there would be a further document to effect the design on the basis of Acohs v Ucorp at [193]-[195]. However, Moshinsky J considered that the context in Acohs was very different and distinguishable.

In 2021, EBC purported to assign the copyright in the designs to Hampden with effect from 2018. At [145], MOshinsky J pointed out the assignment could not have retrospective effect but held it was effective to assign EBC’s rights to Hampden from the date of the deed. This also included the right to sue for past infringements.

Moshinsky J was prepared to treat the designs finalised by Mr Mota as works of joint authorship. Section 10(1) defines:

work of joint authorship means a work that has been produced by the collaboration of two or more authors and in which the contribution of each author is not separate from the contribution of the other author or the contributions of the other authors.

At [135], Moshinsky J stated that the collaboration required for joint authorship “does not require the authors to work directly with one another.” Accordingly:

alterations made by Person A to an earlier work created by Person B can, depending on the circumstances, result in a work of joint authorship of Person A and Person B together.

At [150], his Honour recorded that the works were based on the designs prepared by B&B Studio “and involved only limited input from Mr Mota”. Although his contribution was limited, it was sufficient to constitute him an author. Furthermore, the B&B Studio employees had provided feedback to Mr Mota on his drafts. As a result, Moshinsky J considered that the works were the product of collaboration between B&B Studio employees and Mr Mota and the works were works of joint authorship.

Although Lacorium had not assigned copyright to Hampden, as works of joint ownership both B&B Studio and Lacorium were the intial owners of the copyright and B&B Studio had assigned its rights to Hampden in a separate document. Accordingly, Moshinsky J held that Hampden had standing to sue for infringement as the owner of the interest in the copyright originally vesting in B&B Studio.

What happens next

Whether either side will appeal – or, rather, seek leave to appeal – is not clear yet as it appears final orders on the infringement findings have not yet been made.

Moshinsky J dismissed Aldi’s cross-claim in respect of unjustified threats on the basis of three letters as they were directed to the puffs packaging which he had found infringed. However, there is, or may be, an outstanding issue in relation to a fourth letter which is yet to be resolved.

Meanwhile, in the UK

The Court of Appeal has allowed Thatcher’s Cider’s appeal finding that Aldi’s benchmarking strategy took unfair advantage of Thatcher Ciders well-known trade mark.

Hampden Holdings I.P. Pty Ltd v Aldi Foods Pty Ltd [2024] FCA 1452

  1. You may have come across an earlier imbroglio in which Aldi’s Chazoos Cheezy Twists infringed the Twisties trade mark although, more recently, its Moroccanoil product packaging was exonerated.  ?
  2. Extracted by his Honour at [170].  ?

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