DIESEL licensee walks away without restraining order

Australia

In World Brands Management Pty Limited v Cube Footwear Pty Limited, the Federal Court of Australia has refused to grant an interlocutory injunction against the use of a shoe design allegedly infringing that of the plaintiff. The court held that there was a real possibility that the defendant would show at trial that the plaintiff's shoe design lacked distinctiveness.

World Brands Management Pty Limited (WBM) is the exclusive distributor in Australia and New Zealand of Diesel-branded footwear. It is also the owner of a registered design in Australia in respect of footwear. WBM brought proceedings against Cube Footwear Pty Limited, a manufacturer and importer of footwear, alleging that the latter had:

  • infringed its design;

  • violated Section 52 of the Trade Practices Act 1974 on deceptive and misleading conduct; and

  • committed the tort of passing off.

The court refused WBM's application for an interlocutory injunction. The court (i) considered that evidence had been adduced that suggested that there had been prior publication of the design before the date of the application to register it, and (ii) raised questions as to whether the design was distinctive. It confirmed the proposition that an interlocutory injunction should not be granted where there is a serious challenge to a recently registered design.

In respect of the Trade Practices Act and passing off claims, the court held that it would be unlikely that a purchaser would confuse WBM's shoes with Cube's shoes on the basis that (i) shoes are "not a quick impulsive purchase", and (ii) Cube's shoes retailed for approximately one-third of the price of the DIESEL-marked shoes. It also found that there was no suggestion that Cube's shoes had been deceptively branded.

Lastly, the court found that the balance of convenience rested against granting the interlocutory injunction, citing delay on the part of WBM in bringing the action.

The matter is next listed for directions on September 17 2004.

Natalie Hazel, Blake Dawson Waldron, Sydney

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