LEGO JURIS A/S & Anor v THE LEGO SHOP LIMITED [2016] NZHC 579

LEGO JURIS A/S & Anor v THE LEGO SHOP LIMITED [2016] NZHC 579 [4 April 2016]IN THE HIGH COURT OF NEW ZEALANDHAMILTON REGISTRYCIV-2016-419-52[2016] NZHC 579BETWEEN LEGO JURIS A/SFirst PlaintiffLEGO NEW ZEALAND LIMITEDSecond PlaintiffAND THE LEGO SHOP LIMITEDDefendantHearing: 4 April 2016Appearances: Mr J S Gurnick for the plaintiffsMr Townley for defendant in personJudgment: 4 April 2016ORAL JUDGMENT OF ASSOCIATE JUDGE J P DOOGUE[1] The plaintiffs (as I will collectively call them) have sued the defendant because essentially he has incorporated a company the name of which includes theword "Lego" which is a trademark of Lego. Lego wants the defendant to stop using the name in any way including by arranging for a change of name of the company.[2] Today when this matter was called for the first time Mr Townley who is the proprietor of the defendant and presumably a director of the company, appeared and I gave him leave to address the Court even though the usual rule is that a company can only be represented in Court by a lawyer with a current practicing certificate.[3] Mr Townley has sought to explain why his company first of all got into thisdifficulty with using Lego's name and then secondly why it has taken so long tocorrect the position. While I can understand that the intricacies of trademarks, the Fair Trading Act 1986 and the law of passing off presents some complexity to a layperson such as Mr Townley, there is sworn evidence that Lego by its legal representatives contacted him as long ago as June 2015 and requested that the defendant cease using the Lego name. Notwithstanding that, as of today thecompany's name remains the same. It continues to use the name "Lego". Iunderstand that Mr Townley has made some attempt to come up with a substituted name. Mr Gurnick said that he understood approval had been sought for the name"The Plastic Brickshop". However Mr Townley told me that because of some reason involving the Inland Revenue it has not been possible at this stage to complete thechange of name. I must say I do not accept that whatever difficulties there may be inthis matter that it could have taken since June last year until the present time for thedefendant to comply with what seem to be legitimate requests from Lego.[4] Mr Townley assured me that he was a law abiding citizen and that he regretted that his company had found itself in this position. Notwithstanding those remarks, I consider that given the undefended nature of the proceeding and theundisputed claim of the plaintiffs to use the word "Lego", it is reasonable andlegitimate for the plaintiffs to seek the injunctions that they do. Had there been prompt and cooperative action on part of the defendant to comply with Lego'sconcerns when they were first made known, I might have hesitated in issuing theinjunctive orders which Lego seeks. However, as I have said, I am left genuinely puzzled as to why matters have taken this long and I consider that the point has been reached where further time should not be given to the defendant. I therefore make the orders granting the injunctions that are sought in the prayers for relief under each of the three causes of action. Mr Gurnick tells me that Lego do not intend to seek damages from Mr Townley.[5] At the hearing today Mr Gurnick has put forward a schedule of costs calculated on a 2B basis which totals $10,536.47. I gather from Mr Townley that he is a person of very modest financial resources and effectively his resources are those of the company. He would have considerable difficulty meeting the costs if an order was made that he pay them. On the one hand, one can see that Mr Townley has largely brought this on his own head by failing to comply with Lego's request beforethey issued proceedings. On the other hand, Lego might be disposed to take a pragmatic view of the matter of costs if Mr Townley acts promptly to change the name of the company and not in any other way use the word Lego. To giveMr Townley an opportunity to bring his company's affairs to order, I adjourn thisproceeding to 2.15 p.m. on 2 May 2016. He should in the meantime take prompt steps to correct the position with regard to the use of the Lego name. There is no obligation on the part of Lego to waive its entitlement to costs, of course. However, the parties should advise me what the position is as to costs at the next call of this matter. It may also be relevant for the Court to know whether Mr Townley/the defendant has taken the steps that Mr Townley says he is going to to correct the name of the defendant company._____________J.P. DoogueAssociate Judge