Intellectual Property Update - BGD Corporation Pty Ltd v Kalaoun

Intellectual Property Trade Practices
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M Marcus
C Cunliffe 2
Marcus Fleming Headshot 1

[2021] FCA 1127

Trade Marks – ACL – Passing off – default judgment for failure to comply with court orders

This proceeding concerned an application for default judgment by BGD Corporation in relation to allegations of trade mark infringement, contraventions of the Australian Consumer Law and passing off.

The second applicant, The Drain Man (Australia) Pty Ltd, carried on a business of providing plumbing services under the name “The Drain Man”, and alleged that it had generated substantial goodwill and reputation in Australia in relation to that name. BGD Corporation is the registered proprietor of two trade marks for logos, both of which incorporate the words “THE DRAIN MAN” (alleged to be dominant cognitive cues of the marks).

The respondent, Mr Kalaoun, carried on a business of providing plumbing services by reference to various names which included the words “Drain Man”, including “Mr Drain Man”, “My Drain Man”, “Sydney’s Mr Drain Man” and “Local Drain Man”.

The history of the proceeding, which is described in O’Bryan J’s judgment, involved a series of failures by Mr Kalaoun to comply with procedural orders in the proceeding, including for the giving of discovery to facilitate a mediation and for the filing of a defence. After declining to order default judgment on two occasions, O’Bryan J gave Mr Kalaoun one last chance to comply with the Court’s orders. His Honour did, however, make self-executing orders pursuant to r 5.32(2)(e) of the Federal Court Rules 2011 (Cth), by which default judgment would be entered against Mr Kalaoun in the event of continued non-compliance.

While Mr Kalaoun did (eventually) file his defence, he remained in default of the Court’s order by failing to give discovery as he had been required to do. Justice O’Bryan held that this was an appropriate case to grant the applicants judgment in default, observing that the history of non-compliance by Mr Kalaoun was such as to indicate an inability or unwillingness to cooperate with the Court and the applicants in having the matter ready for trial within an acceptable period; and the non-compliance was continuing and occasioning unnecessary delay, expense or other prejudice to the applicants.

Justice O’Bryan made declarations of contravention, granted relief in the form of injunctions, and ordered Mr Kalaoun to pay the applicants’ costs of the proceeding.

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