Case: Sony Computer Entertainment Australia Ltd v Stirling [2001] FCA 1852
Outcome: cited
The applicants made reference in their submissions to Adidas-Salomon AT v Turner [2003] 58 IPR 67. Goldberg J commented upon the limited evidence available to him upon which to base the assessment of damages for the infringement of trade mark rights. The difficulty arose from the limited information which could be extracted from the respondent as to the sale of infringing items. His Honour however said (at 67): '... notwithstanding the difficulty facing me on the assessment of damages the Court has to do the best it can on available material.' He quoted from the judgment of the Full Court in Enzed Holdings Ltd v Wynthea Pty Ltd (1984) 57 ALR 167 where the Court said (at 183): 'The principle is clear. If the court finds damage has occurred it must do its best to quantify the loss even if a degree of speculation and guess work is involved. Furthermore, if actual damage is suffered, the award must be for more than nominal damages. We should add that we can see no reason why this principle should not apply in cases under the Trade Practices Act as well as in cases at common law. We emphasize, however, that the principle applies only when the court finds that loss or damage has occurred. It is not enough for a plaintiff merely to show wrongful conduct by the defendant.' See also: Sony Computer Entertainment Australia Pty Ltd v Stirling [2001] FCA 1852. 48 There is a question about precisely what is meant by the concept of 'devaluation of product". In Sony Computer Entertainment , Emmett J was concerned with the sale of counterfeit Sony Play Station games. His Honour said (at [9] and [10]): 'I am ... satisfied that there would be some damage to the applicants by reason of counterfeit games being made available for sale. The respondent offered games for sale by advertisements in the Trading Post newspaper. Sales took place by people calling at a private home. In the circumstances I do not consider that purchasers of the counterfeit games would reasonably have believed that the games were genuine Sony products. I would draw the inference that, generally, a buyer would be satisfied that, in order to obtain a genuine Sony game, one would need to buy it through ordinary channels. Nevertheless, the fact that Sony games are available in the circumstances in which the respondent was selling them tends to devalue the product that the applicants offer for sale. Ten per cent of the sale value is a very substantial proportion. It is very difficult to place any figure on the loss that would have been suffered by Sony by way of additional devaluation of its products by reason of the conduct of the respondent.' His Honour concluded that the loss occasioned by the respondent would be very small. However it would not be nominal. He considered it appropriate to order the respondent to pay damages which he assessed at $3,000. 49 In Adidas Salomon , Goldberg J also considered the devaluation of trade marked products. His Honour found that the respondent had offered infringing items for sale over the internet. Their availability for sale was made apparent to the public and such persons as would go his website. As in the case of the Sony Play Stations, he found it unlikely that the purchasers of the items or persons looking at the website would reasonably have believed that the items were genuine Adidas items. He said (at 68 [7]): 'I am prepared to draw an inference that, in general terms, a buyer would be satisfied that in order to obtain a genuine Adidas garment, one would need to buy it through more official channels and that it would have been apparent by reference to price that these were not genuine Adidas items. I am satisfied that the fact that infringing items were available in the circumstances in which the respondent was offering them for sale tended to diminish the reputation of the genuine product sold by Adidas and tended to devalue the products that Adidas offers for sale.' Like Emmett J his Honour found it very difficult to place any specific figure on the loss that would have been suffered by Adidas by way of additional devaluation of its products by reason of the conduct of the respondent. He was satisfied that such damages would not be nominal having regard to the extensive audience available to a website such as the respondent's website.