England and Wales Patents County Court

IN THE PATENTS COUNTY COURT

		St. Dunstan's House 133-137 Fetter Lane London EC4A 1HD
		3/11/2010

His Honour Judge Birss QC:

1. This matter has been dealt with on paper without a hearing.
2. On 26^th October 2010 I gave judgment on the claimant's application for summary judgment and to strike out certain parts of the defendants' defences. That judgment is [2010] EWPCC 012. The background to the case and the context in which the application arises are set out there and I will not repeat them. Once judgment was handed down I heard the parties' submissions on the various consequential orders which needed to be made. Many of the matters were agreed between the parties and for the points which were not agreed, I ruled on them during the course of the hearing. Following my judgment in the Technical Fibre case [2010] EWPCC 011, the directions were given under the rules applicable to cases commenced in this court before 1^st October 2010. The principle of proportionality under CPR Pt 1.1(2)(c) of course has always applied.
3. As is conventional, at the conclusion of the hearing counsel indicated that they would draw up a document embodying the various orders which had been made for me to approve. In the course of drawing up the order a point arose between the parties relating to costs. The parties invited me to decide the point on the basis of written submissions which they have provided. This judgment is my ruling on that point.
4. The order made on 26^th October is set out below. The vast majority is not in dispute. The point at issue is marked in brackets and underlined at paragraphs 17 and 18. The order in the form the claimant contends should be made is underlined whereas the defendants' proposal is in italics.

"IT IS DECLARED THAT:

a. the Claimant's claim was not settled prior to the issue of the claim form during the course of correspondence between the parties' solicitors;

b. the Claimant was at the times material to the Defendant's alleged infringements the owner of database right subsisting in the Database (as defined in the Particulars of Claim);

AND IT IS ORDERED THAT:

1. Save for its first two sentences and last sentence, paragraph 17 of the First Defendant's Defence be struck out.

2. No further reference shall be made to the contents of the without prejudice correspondence in the evidence and submissions put before the trial judge.

3. The claim be stayed until 10 December 2010 for the parties to discuss settlement and/or undertake mediation.

4. The parties have permission to apply in writing to the judge on 2 days' notice for an extension of the stay referred to in paragraph 3 above.

5. On or before 14 January 2011, the parties shall give standard disclosure by list on the issue of infringement to every other party by way of exchange of lists.

6. Any requests for inspection or copies of disclosed documents shall be made within 14 days after service of the list.

7. Each party shall serve the respective witness statements of the oral evidence which the party serving the statement intends to rely on in relation to any issues of fact, those statements and any notices of intention to rely on hearsay evidence to be exchanged by 4.00 p.m. on 11 February 2011.

8. Subject to any application the parties may subsequently make, neither party has permission to rely upon expert evidence.

9. The trial of the claim shall take place between 21 March 2011 to 23 May 2011 ("the trial window").

10. The trial shall be listed for hearing with a time estimate of 1 day, with 2 hrs estimated pre-reading.

11. The Claimant shall make an appointment to attend on the Listing Officer (Room WG4, Royal Courts of Justice, Strand, London WC2A 2LL; Tel. 020 7947 6816; Fax No. 0870 739 5869; email rcjchancery.judgeslisting@hmcourts-service.gsi.gov.uk) to fix a trial date within the trial window, such appointment to be not later than 30 November 2010 and give notice of the appointment to the Defendant.

12. The parties shall, no later than 21 days before the date fixed for trial, serve on the other parties a list of all documents they want to be included in the trial bundles.

13. The Claimant shall, no later than 14 days before the date fixed for trial, serve on the Defendant one set of the bundles for use at the trial.

14. Not earlier than 7 days or later than 3 days before the date fixed for trial the Claimant shall file with the Judge's clerk a trial bundle for the use of the Judge in accordance with Appendix 6 of the Chancery Guide.

15. The parties shall lodge copies of their Skeleton Argument not less than two clear days before the date fixed for trial.

16. The parties have permission to apply on three days' notice for further directions and generally.

17. [The Defendants / The First Defendant] shall within 14 days of the date of this order pay to the Claimant the sum of £12,000, being 75% of the Claimant's costs of the application, summarily assessed.

18. [The Defendants / The First Defendant] shall pay the Claimant's costs of the issue of whether the claim was settled (to the extent to that they do not form part of the Claimant's costs of the application, which are provided for in preceding paragraph), the aforesaid costs to be the subject of detailed assessment on the standard basis."

5. The declarations at (a) and (b) reflect my judgment that the action has not settled and my summary judgment on subsistence and ownership of database right.
6. Paragraph 1 of the order strikes out part of the first defendant's defence. One of the issues I had to resolve at the hearing was precisely what had to be struck out from the first defendant's defence and from the second defendant's defence. This order reflects my ruling on the matter, that certain sentences from the first defendant's defence should be struck out and that nothing in the second defendant's defence needed to be struck out. It may seem a rather fine point to decide the matter on a sentence by sentence basis but since the parties could not agree, it was the only way forward.
7. Paragraph 17 of the first defendant's defence (with the struck out sentences shown in square brackets and italics) reads:-

"17. It is averred that as regards any loss and damage arising out of the unwitting use of the seed detail that the first defendant calculated loss and damage at £3095.11. This sum was paid by the first defendant to the claimant's solicitor's account by electronic transfer on 2 February 2009. [Further or alternatively the claim has been compromised by the exchange of without prejudice correspondence and the aforesaid payment. The claim was issued on 20 February 2009.] In the circumstances the claimant is not due any further sum for the use of the seed detail in the Mailing and is estopped from claiming the same."

(I have corrected an obvious typographical error in this paragraph and paragraph 19 below)

8. The relevant paragraph of the second defendant's defence is paragraph 19. The passage which the claimant contended should be struck out is marked in square brackets and italics as follows:-

"19. Paragraph 27 of the particulars of claim is denied. The second defendant repeats the facts set out in paragraph 17 and 18 above. [It is averred that the first defendant by way of payment of £3095.11 to the claimant's solicitors on 2 February 2009 gave full satisfaction and accord for all loss and damage arising out of the alleged Database infringement.] In the circumstances the claimants are estopped from seeking any further sums for loss and damage from the second defendant."

9. The first two sentences remained because they cross refer back to the second defendant's denials of infringement and joint liability. Those matters will be addressed at trial. The estoppel point is one which I left to be addressed on an inquiry and so the claimant did not object to the last sentence. The parties could not agree what to do about the sentence in the middle of paragraph 19. I decided that the sentence could remain since provides the premise for the estoppel and although it used the expressed "full satisfaction and accord" which might appear to be a plea that the matter had been settled, in the context of my judgment on the settlement that was not the case.
10. Paragraph 2 of the order arises as a consequence of my judgment that the without prejudice correspondence did not lead to settlement. The parties did not object to my hearing the trial.
11. Paragraphs 3 and 4 order a stay of the proceedings for a short time to allow the parties to discuss settlement or mediation. Although it builds in a delay in the case, the parties both wanted an order in this form and of course if the matter does settle then the stay will have achieved its objective.
12. Paragraphs 5 and 6 set a timetable for disclosure on the issue of infringement and paragraph 7 sets a date for exchange of witness statements relating to fact evidence. Paragraph 8 reflects my judgment that as the matter stands there is no need for expert evidence. Paragraphs 9 to 15 deal with a trial. The trial will take 1 day and be heard between March and May of next year. Were it not for the fact that the parties together asked to stay the case for about 6 weeks, I would have set the trial window to start from January.
13. The issue to be decided relates to costs. I decide to award the claimant 75% of the costs of the application and I summarily assessed those costs as £16,000, leading to sum to be paid of £12,000. The claimant contends the orders in paragraph 17 and 18 should provide that the defendants pay the costs (i.e. the order should make both defendants liable) whereas the defendants submit that the order should only provide that the costs are payable by the first defendant.
14. The order in the form discussed in court covered both defendants and Mr Power on behalf of the defendants did not take the point at the hearing which he now seeks to raise. He submits that he was dealing with the matter of costs in a broad brush manner and was unaware that that each defendant was paying proportionately and separately for their legal fees. He accepts he ought to have taken the point at the hearing. Nevertheless, and without wishing to encourage applications of this kind, this is the kind of point which the court can resolve on paper after the event. The order has not been drawn up or perfected (CPR 40.2(2)(b)). Mr Hill, sensibly in my view, did not submit that the order the defendants seek could not be made at all in the circumstances, he focussed his submissions on the substance of the issue itself.
15. The defendant submits that the costs order should only be paid by the first defendant alone for two reasons. First because the application to strike out paragraphs of both defendants' defences only led to the first defendant's defence having paragraphs struck out and refused to strike out anything from the second defendant's defence and second because the application for summary judgment against both defendants was refused. The defendant submits that the court should consider the defendants' liability for costs individually.
16. The claimant submissions to the contrary are as follows:

i) The second defendant has as much interest in the success of Mr Power's submissions on the settlement issue as the first defendant. If the court had found that the action had settled it would have been settled against both defendants.

ii) The fact that no part of the second defendant's defence was struck out is immaterial. The declaration made affects the second defendant just as much as the first defendant.

iii) One of the reasons the court gave in its oral judgment dealing with the details of which paragraphs should be struck out and allowing paragraph 19 of the second defendant's defence to remain was that the main judgment had reduced the scope of the case the second defendant could in future put forward on the basis of the paragraph.

17. It seems to me that the defendants' submissions do not reflect the outcome of the application as a whole. To contend that all that has happened is that I have struck out part of one paragraph from one defendant's defence and refused summary judgment against both defendants is not a complete statement of what happened. If I had found that the action had settled that would have been as much for the benefit of the second defendant as the first. The action against both defendants would, in that event, have come to a halt. This is the major point.
18. Secondly it is not right to say that no summary judgment at all has been given against the defendants. On the contrary I have decided summarily the issues of ownership and subsistence of database right, something both defendants had (or appeared to have) put in issue. The declarations I have made affect both defendants.
19. Finally Mr Hill is also correct to remind me of my oral judgment at the hearing on 26^th October dealing with the details of which paragraphs should be struck out in which I allowed paragraph 19 of the second defendant's defence to remain. One of my reasons for leaving that paragraph in its current form that the main judgment [2010] EWPCC 013 had indeed reduced the scope of the case the second defendant could in future put forward on the basis of the paragraph.
20. Accordingly I will make the order in the form proposed by the claimant.