In an earlier post the IPKat reported on the decision of Daniel Alexander QC in Cantor Gaming Ltd v Gameaccount Global Ltd. There has since been a sequel, noted a little while back by subscription-only service Lawtel, on the issue of costs.
Right: is a court order to stop a defendant infringing, when he has already stopped and given undertakings to do so, really needed? Or is this a case of taking a sledgehammer to crack a nut?
At trial the court granted an injunction to restrain what was termed a "minor copyright infringement and breach of a contractual licence". In brief, Cantor alleged that Gameaccount had, through its use of a range of computer software, both infringed the copyright in it and breached the terms of its licence to use it. Gameaccount accepted that it had made unauthorised use of the software in respect of one particular golf game and gave undertakings to cease doing so immediately. Cantor however still sought an injunction in respect of the whole software suite, plus further information from Gameaccount. Witness statements were exchanged and attempts each party attempted to settle the dispute. By the time of the trial, Gameaccount had ceased all alleged infringing use of the software. The judge held that, despite the minor nature of the breach and infringement, Cantor was still entitled to its injunction. A delighted Cantor sought its costs in full, but Gameaccount demurred: its view was that, while it was liable, costs should depend on the conduct of the parties and the big question (who was the real winner?) rather than the little one (who succeeded at trial?).
Daniel Alexander QC ruled that, in the circumstances, even though Cantor got its injunction, there was no clearly successful or unsuccessful party. Gameaccount had infringed, but
* all allegedly infringing use had ceased before the proceedings had commenced,In his view therefore, there was no real winner. This being so, the general rule that costs follow the event would not apply.
* the judgment in Cantor's favour was of limited commercial importance, and
* the claim had no substantive value.
On the question of conduct, neither side had behaved unreasonably during the litigation, and both sides had made attempts at different times and stages to resolve the matter. Those circumstances suggested that it would be appropriate to make no order for costs - but where a defendant admits an element of copyright infringement, a claimant is at least entitled to its costs of verifying whether there was further infringement so as to enable it to determine the scope of its claim. In this case, since Gameaccount had given Cantor some cause for distrust, the latter was entitled to investigate the possibility of further infringement and it was only after the exchange of witness statements that Cantor received this. Accordingly, to reflect the overall justice of the case, it would be appropriate to award Cantor its costs incurred up until 14 days after the service of witness statements, and to make no order as to costs thereafter.
The IPKat thinks this was quite a neat solution and wonders whether Cantor would have pressed on for injunctive relief in respect of an ex-infringement if it knew this in advance. Merpel says, a defendant in a situation such as this will be encouraged to cough up the relevant information as swiftly and fully as it can, if the consequence of a protracted exchange of witness statements means more costs.
If you are attending the CLT conference on Intellectual Property Litigation and Dispute Resolution this coming Monday, you may find it hard to find. It has been moved to a new venue, Dexter House, which the IPKat had some trouble pinning down on the photocopied map he was sent. The venue's address is 2 Royal Mint Court, Tower Hill, London EC3N 4QN. The IPKat thinks this venue only opened last week, which is good news for those IP lawyers who prefer to apply their grafitti to freshly-plastered walls ...