Decision highlights discretionary nature of granting leave to appeal

In Hills Holdings Limited v Bitek Pty Ltd ([2011] FCA 644, June 7 2011), the Federal Court of Australia has considered an application by Hills Holdings Pty Ltd under Section 195(2) of the Trademarks Act 1995 for leave to appeal a decision of a primary judge that had upheld an earlier decision by the registrar of trademarks to dismiss Hills’ opposition to a trademark application for DIGITECK. 

At the time of making its application, Hills - the owner of the DGTEC mark - had been granted leave to appeal an infringement proceeding that it had unsuccessfully brought against the owner of the DIGITEK mark.

In hearing the leave application, the Federal Court considered the discretionary nature of the jurisdiction of the court to grant leave to appeal and the requirement that Hills demonstrate at a minimum that there was a prima facie case of error on the part of the primary judge. In exercising the discretion of the court, the Federal Court observed from earlier cases two principal factors which arise for consideration, being:
  • the sufficiency of doubt to warrant reconsideration of the matter before the court; and
  • the extent of potential injustice in denying an opportunity to appeal.
The apparent hurdle for Hills was that, leaving aside the question of error, the potential for injustice appeared diminished in circumstances where Hills had already been twice unsuccessful in its opposition to the registration of the DIGITEK mark and still had an alternative avenue under Section 88 of the act by which to seek cancellation of the mark. That said, the court ultimately found this was an exceptional case. 

A key factor favouring the grant of leave to appeal was that both the appeal for the infringement proceeding and the opposition proceeding at first instance raised common issues of fact with the potential for conflicting decisions to be reached. The court was mindful of the need for judicial consistency, but also noted that commonality of issues between the two proceedings on its own is not sufficient without some arguable foundation that the appeal sought by Hills would succeed. Hills’ proposed notice of appeal identified errors of law on the part of the primary judge in the approach and application of the law concerning whether the goods in respect of which the DGTECK and DIGITEK marks was registered were “deceptively similar” or goods of the “same description”, and whether Hills had acquired a reputation in Australia in the DGTECK mark prior to the relevant priority date. After reviewing the reasons of the primary judge, the court accepted that there was scope for Hills’ submissions on questions of law to be argued and sustained, but was careful not to form any view as to Hills’ probability of success. Accordingly, the court granted leave to appeal.

This decision highlights the discretionary nature of granting leave to appeal under Section 195(2) of the act, and that, irrespective of whether an applicant has been twice refused, the grant of leave to appeal is carefully considered according to the facts of each case, and may still be granted.

Stephen Stern and Faisal Mian, Corrs Chambers Westgarth, Melbourne

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