England and Wales Patents County Court

IN THE PATENTS COUNTY COURT

		Rolls Building 7 Rolls Buildings London EC4A 1NL
		03/05/2012

His Honour Judge Birss QC :

1. This judgment deals with a question concerning the jurisdiction of the Patents County Court to make certain kinds of interim orders. The orders are search and seizure orders (formerly known as Anton Piller orders) and asset freezing orders (formerly known as Mareva orders).
2. The action is proceeding in the Patents County Court. It is a claim for passing off, copyright infringement, conversion and revocation of a UK registered trade mark. The claimants owned and ran a sushi restaurant in New Malden in Surrey called Yoshi Sushi. It built up a substantial goodwill and reputation in the local area. In the summer of 2010 the landlord of the premises locked them out and installed new tenants in the restaurant. The claimants' case is that the defendants simply continued the existing Yoshi Sushi business as if nothing had happened. The business used the same name, the same logo and the same menus and paperwork. The claimants' case is that the defendants are liable for passing off (since the claimants own the goodwill), copyright infringement (since the claimants own copyright in the menus etc.) and conversion (since the claimants own various goods the defendants used in the restaurant such as the crockery). There is also a claim for revocation of a registered trade mark obtained by the third defendant for the mark Yoshi Sushi. The claimants say it was registered in bad faith.
3. I heard the ex parte application on Wednesday 25^th April 2012. Mr Jonathan Moss appeared for the claimants. The defendants did not appear and were not represented. I decided that I had jurisdiction to make an asset freezing order and should do so on the facts of this case. The order was made over to a return day on 3^rd May 2012. Subject to the question of jurisdiction, my reasons for making the order on its merits were given in an ex tempore judgment on that day. I indicated that my detailed reasons for reaching the conclusion about jurisdiction would be given in a reserved written judgment. This is that judgment. The judgment is not concerned with the merits of the particular application in this case. It is only concerned with jurisdiction.

The problem

4. Although the jurisdiction of the Patents County Court is clear enough, the way in which it is legislated for is not. This case is another illustration of the need to reconstitute that jurisdiction. The Patents County Court has a special jurisdiction over patents, designs and ancillary cases by s287 of the Copyright Designs and Patents Act 1988. It also has the ordinary jurisdiction of a county court (preserved by s287(5) of the 1988 Act) and that includes jurisdiction to hear claims for trade mark infringement, copyright infringement and passing off (see the judgment of HHJ Fysh QC in Minsterstone v Be Modern [2002] FSR 53 and also my judgment in National Guild of Removers v Silveria [2010] EWPCC 15). However, the ordinary jurisdiction of county courts does not include claims for revocation of registered trade marks (and some other matters) but by legislation in 2005 the jurisdiction of the Patents County Court was expanded to cover such cases (see paragraph 8 of my judgment in National Guild).
5. Patents county courts are created by designating an existing county court as "a patents county court" (s287(1) of the 1988 Act). It is convenient and routine to refer to this court as "the Patents County Court" because it is the only one. To be exact it is the Central London County Court, which was designated as a patents county court by the Patents County Court (Designation and Jurisdiction) Order 1994 pursuant to the power in s287. Before that the Edmonton County Court was the county court which had been designated as a patents county court from its inception in 1990.
6. Section 291(1) of the 1988 Act provides that where a county court is designated a patents county court the Lord Chief Justice shall, after consulting with the Lord Chancellor, nominate a person entitled to sit as a judge of that court as patents judge. HHJ Ford was the first person nominated to that role in 1990, followed by HHJ Fysh QC and then I was nominated under s291 in 2010.
7. The County Court Remedies Regulations 1991 (SI 1991 No 1222) deal with remedies available in county courts. Paragraphs 2 and 3 of that regulation provide as follows:

2. In these Regulations, "prescribed relief" means relief of any of the following kinds—

(a) an order requiring a party to admit any other party to premises for the purpose of inspecting or removing documents or articles which may provide evidence in any proceedings, whether or not the proceedings have been commenced;

(b) an interlocutory injunction—

(i) restraining a party from removing from the jurisdiction of the High Court assets located within that jurisdiction; or

(ii) restraining a party from dealing with assets whether located within the jurisdiction of the High Court or not.

3.—

(1) Subject to the following provisions of this regulation, a county court shall not grant prescribed relief or vary or revoke an order made by the High Court granting such relief.

(2) Paragraph (1) shall not apply to—

(a) any county court held by a judge of the Court of Appeal or judge of the High Court sitting as a judge for any county court district;

(b) a patents county court held by a person nominated under section 291 of the Copyright, Designs and Patents Act 1988 to sit as a judge of that court.

[…]

(4) Paragraph (1) shall not—

(a) affect or modify powers expressly conferred on a county court by or under any enactment other than section 38 of the County Courts Act 1984; or

(b) prevent a county court from varying an order granting prescribed relief where all the parties are agreed on the terms of the variation.

8. Thus paragraph 2 defines prescribed relief in such a way as to include search and seizure orders (2(a)) and asset freezing orders (2(b)). Paragraph 3(1) provides that county courts may not grant prescribed relief but paragraph 3(2) provides an exception to paragraph 3(1). The exception in paragraph 3(2)(b) refers to a patents county court held by a person nominated under s291 of the 1988 Act.
9. Thus, on the face of it, one might think that a patents county court held by the person nominated under s291 would have jurisdiction to make an order for prescribed relief. However in McDonald v Graham [1994] RPC 407 this question came before the Court of Appeal. Ralph Gibson LJ (with whom Evans LJ and Sir David Croom-Johnson agreed) expressed the view (obiter) that paragraph 3(2)(b) only permitted such orders to be made in cases within the special jurisdiction of a patents county court and not in cases within the ordinary jurisdiction. Thus the orders would only be available in patents and design cases and in aid of ancillary causes of action but would not be available for example in pure copyright or trade mark cases.
10. From the perspective of 2012, with the PCC firmly established as a general intellectual property court, this distinction appears to be an artificial one. This is all the more so given that some aspects of the PCC's jurisdiction are neither part of the special jurisdiction nor part of the ordinary jurisdiction of a county court. For example this court's jurisdiction to entertain the claimants' application to revoke the defendants' trade mark is conferred (inter alia) by paragraph 7A of the High Court and County Courts Jurisdiction Order 1991 (as amended in 2005). Although that provision includes a reference to ancillary claims, Mr Moss rightly did not suggest that in this case his clients' passing off, copyright or conversion claims could be sensibly regarded as ancillary to the revocation claim and I agree. To describe them as such would be unreal.
11. Moreover, as Mr Moss submitted, the reforms to the procedure in the PCC implemented in 2010 aimed to improve access to justice for all intellectual property cases in the PCC. It would be surprising and would tend to cause needless and disproportionate cost if important remedies were available from the court for some classes of case but not others. If the relief sought in this case falls outside the jurisdiction of the PCC then it does not deprive the claimants of a remedy at all, since the High Court has the jurisdiction to make such orders in aid of proceedings in a county court where the PCC may not (Article 3 High Court and County Courts Jurisdiction Order 1991). However to require the claimants to take that course is hardly a recipe for the cost effective and efficient administration of justice.
12. However in my judgment it would not be legitimate to interpret the County Court Remedies Regulations passed in 1991 through these modern eyes. The Regulations must be interpreted as of their date and in their proper context. Moreover the fact that it may be inconvenient does not mean that a dictum of the Court of Appeal, albeit obiter, can be simply pushed to one side, all the more so when the judge doing so is sitting in a county court.

The judgment of the Court of Appeal

13. The McDonald v Graham case involved both a claim for patent infringement and copyright infringement. HHJ Ford had granted an Anton Piller order and a Mareva injunction, both in support of the copyright claim. The defendant argued the judge had no jurisdiction to do that because paragraph 3(2)(b) of the County Court Remedies Regulations only allowed for such orders if the claim was within the court's special jurisdiction under s287. The judge considered that he had jurisdiction to make the orders on two grounds. First because the copyright claim was ancillary to the patent claim and so was within the special jurisdiction and second because in any event, if the claim was within the ordinary county court jurisdiction, it was before a patents county court held by a duly nominated judge and the requirements of paragraph 3(2) of the remedies regulation were satisfied. On appeal the Court of Appeal upheld the judge's first ground. However Ralph Gibson LJ (with whom Evans LJ and Sir David Croom-Johnson agreed) expressed the view that the second ground was not correct.
14. Ralph Gibson LJ said this (p435 ln 37 – 436 ln25):

If I am right so far, there is no need to decide the question whether the judge's alternative ruling should be upheld, namely that he had power to make the Anton Piller and Mareva orders under the court's ordinary county court jurisdiction because the claim was before a patents county court held by a duly nominated judge.

For my part I have difficulty in accepting this alternative ruling. The 1991 Regulations provide by regulation 3 that, subject to the following provisions of this regulation, a county court "shall not grant prescribed relief…". It is not in issue that the Anton Piller and Mareva orders made in this case fall within the description of prescribed relief. By regulation 3(2) that prohibition shall not apply to:

"(a) any county court held by a judge of the Court of Appeal or judge of the High Court sitting as a judge for any county court district; or

(b) a patents county court held by a person nominated under section 291…'

I do not know in what circumstances it was thought likely that a High Court judge or judge of the Court of Appeal would sit as a judge for any county court district. Sub-paragraph (a) preserves any power that any county court has to grant prescribed relief if and when that court is "held by a judge of the Court of Appeal" etc. The alternative ruling of the learned judge proceeded on the basis that the prohibition in regulation 3(1) does not apply to "a patents county court held by a person nominated under section 291 to sit as a judge of that court" whether the action and claim are or are not within the special jurisdiction. If that were the intended meaning it could, as I think, have been more clearly stated by including the words "or person nominated under section 291" in regulation 3(2)(a) after the words "judge of the High Court"; or by making regulation 3(2)(b) provide that the prohibition shall not apply to "any county court held by a person nominated etc " instead of "a patents county court held by a person nominated etc ."

Miss Clark in her submissions in support of the judge's alternative ruling contended that, in any common law action, e.g. for trespass to goods under the ordinary jurisdiction of the county court, the judge, if he should be a person nominated under section 291, would have the power to grant an Anton Piller or Mareva injunction although such power would not be available to an ordinary judge of that court. It is not clear to me that that consequence is within the intentions of Parliament as expressed in the 1991 Regulations.

15. Thus the key to the Court's reasoning was that if paragraph 3(2)(b) meant that a PCC held by the nominated person had jurisdiction to make the relevant orders whether or not the claim was within the special jurisdiction, it could have been more clearly stated in different and simpler ways. The second point made by the learned judge (in the final paragraph) is that it was not clear to him that the consequence put forward in Miss Clark's submissions, that the person nominated would have jurisdiction to make such an order in any common law action, was within the intentions of Parliament.
16. The first point, if I may say so with genuine respect, is by no means trivial but it is not overwhelming. Clearly it is a matter capable of illuminating the intention of the draughtsman but the fact that with hindsight legislation could have been drafted in a different way is very often the case. The one thing which is striking about paragraph 3(2)(b) is that there is no mention at all of the special jurisdiction. The distinction between the special jurisdiction and the ordinary county court jurisdiction is not drawn expressly in the regulation. It seems to me therefore that it can properly be said that if that distinction had been part of the legislator's intention, the point could readily have been expressed too. It was not. In other words it seems to me that the fact the paragraphs could have been drafted differently cannot be decisive in this case.
17. The second point is really a development of the first point. The learned judge was there rejecting Miss Clark's submission because it was not clear to him that the consequence was within Parliament's intention as he had discerned that intention to be from considering the first point.
18. Thus the Court of Appeal's reasoning is really based on a single point. Of course since the Court were clear that they did not need to decide the issue there was no reason why the analysis needed to be any fuller. However before me the point goes to the heart of the matter. It is part of the ratio of my decision.
19. In my judgment the correct interpretation of the County Court Remedies Regulations is that a patents county court held by the person nominated under the 1988 Act has jurisdiction to make orders for prescribed relief irrespective of the jurisdictional basis on which the case comes before the court. The case could be within the special jurisdiction as defined by s287 of the 1988 Act, the ordinary jurisdiction of a county court, preserved in a patents county court by s287(5) of the 1988 Act or within the jurisdiction conferred in other ways such as that covering revocation of trade marks. My reasons are as follows.
20. First is a point made briefly by HHJ Ford in his judgment under appeal in McDonald v Graham but which bears further elaboration. As HHJ Ford pointed out, when it was introduced in 1990 the Patents County Court had jurisdiction to grant Mareva and Anton Piller orders (per HHJ Ford paragraph 3.8 p416). He said "When this court was established all County Courts had the power to make such Orders but this power was taken away from them by the County Court Remedies Regulations. However this removal of power was expressly disapplied to "a Patents County Court held by a person nominated […](Regulation 3(2)(b)) ".
21. When the PCC was set up in 1990 a Users' Guide was published with a foreword by the then Lord Chancellor Lord Mackay of Clashfern. The guide has a section on jurisdiction (p7) which obviously refers to the special jurisdiction over patents and designs but goes out of its way to draw express attention the court's ordinary jurisdiction and in the section addressing the ordinary jurisdiction the guide draws express attention to the availability of ex parte interlocutory relief including injunctions and Anton Piller orders. The two causes of action mentioned as examples of the ordinary jurisdiction were contractual disputes and passing off. Thus from the outset the PCC was envisaged to have a wider role to play than simply handling cases in the special jurisdiction. Dealing with other intellectual property cases (e.g. passing off) and common law actions (e.g. contractual disputes) were part of its role and that role was expressly described as including the grant of Anton Piller orders. Later in the 1990 Guide (section 17 p27-28) there is also a section on ex parte applications which does not distinguish between the special and ordinary jurisdiction of the PCC and which mentions Anton Piller and Mareva injunctions expressly.
22. Thus part of the context in which the County Court Remedies Regulations were enacted was that "a patents county court held by a nominated person" was recognised as being a court which could in a proper case grant Anton Piller and Mareva injunctions in cases before it generally, not just in cases in the special jurisdiction.
23. This seems to me to be an important point. Given the publicly expressed role of the PCC at the time, it seems to me that if Parliament had intended only to permit prescribed relief orders in cases within a special jurisdiction of a patents county court they would have said so. The intention of paragraph 3(2)(b) seems to me to have been to preserve what was an existing aspect of the jurisdiction of a patents county court. No distinction in relation to such relief had been drawn hitherto and so if Parliament had intended to draw one in the regulation they would have done so.
24. Although HHJ Ford alluded to this point to some extent in his paragraph 3.8 he did not elaborate and the Court of Appeal did not focus on it.
25. Second, it seems to me that in considering paragraph 3(2)(b) itself, a natural question to ask is what does it mean by "a patents county court"? As I understand the Court of Appeal's reasoning, they appear to have understood "a patents county court" to be a reference to the special jurisdiction. After all the name of the court uses the word "patent" and that is the hallmark of the special jurisdiction. Indeed that I believe is what the learned judge was referring to when he said that if the intended meaning of paragraph 3(2)(b) had been to include the ordinary jurisdiction it could have been more clearly stated by providing that "the prohibition shall not apply to 'any county court held by a person nominated etc' instead of 'a patents county court held by a person nominated etc .'" The idea there is that "any county court" relates to or encompasses the ordinary jurisdiction whereas "patents county court" refers to the special jurisdiction. However that is not the way in which the legislation is put together.
26. A patents county court is created by designating an existing county court under s287. Thus in paragraph 3(2)(b) "a patents county court" simply means a county court designated as such. Today it is Central London County Court. Thus "a patents county court" is not a court which only has a special jurisdiction. It means a court which has both a special and an ordinary jurisdiction. By the same token the person nominated under s291 referred to in paragraph 3(2)(b) sits "as a judge of that court", in other words today as a judge of the Central London County Court. The special patents jurisdiction was not conferred on a person, it was conferred on a court.
27. It seems to me that this at least partly explains some of the drafting of the regulation which puzzled the Court of Appeal. It is undeniable that the provision could have been drafted in the manner referred to by Ralph Gibson LJ but there is a logic to the way it was drafted which is nothing to do with the distinction between the special and ordinary jurisdiction. To apply the exception to the court with the patents county court's jurisdiction, the paragraph needed to refer to "a patents county court". However one cannot simply refer to "a patents county court" because that would mean any judge of the designated county court had the power to make the orders, which is clearly not what was intended. So the reference to "a patents county court" was qualified by reference to the nominated person in order to avoid that result. This logic is capable of explaining why the provision is drafted in the way it is and there is nothing in it to indicate that the provision was intended to refer only to cases in the special jurisdiction. The nominated person exercises the entire jurisdiction of a patents county court.
28. Third, I will mention policy considerations. If the relief was available in a copyright case ancillary to a patent matter (as held by the Court of Appeal on the first ground) I can think of no policy reason why the relief should be prohibited in a case on the same cause of action (copyright) properly before the court on another occasion albeit no longer ancillary to a patent case.
29. I find that the terms of paragraph 3(2)(b) mean what they say. I believe the provision applies to all claims before a patents county court held by a person duly nominated under the 1988 Act regardless of the basis on which the claim is within the court's jurisdiction. Asset freezing orders and search and seizure orders may be made in the Patents County Court by the nominated judge in all cases properly before the court.
30. Today, with the increasing workload of the court, senior intellectual property practitioners sit in the Patents County Court as Recorders to hear intellectual property cases. The provision do not confer jurisdiction to make orders for prescribed relief on them but there is nothing surprising about that.
31. Accordingly the prohibition on prescribed relief in paragraph 3(1) of the County Court Remedies Regulations does not apply in this case.