Peter Knox KC and Daniel Goldblatt (instructed by RHF Solicitors) for Mr Price and Supawall Limited
Sir Christopher Floyd :
There are two appeals before the court against judgments and orders of Mr Nicholas Caddick KC sitting as a deputy judge of the High Court. They arise in litigation over a variety of intellectual property rights between the claimants, Mr Price and Supawall Limited (“Supawall”), and the defendants Flitcraft Limited, Garry Flitcroft and Thomas Flitcroft (to whom I will refer collectively as “Flitcraft”).
Mr Price and Supawall sued Flitcraft for infringement of two patents (GB 2415714 and GB 2436989 – “the 714 patent” and “the 989 patent” respectively), infringement of copyright in photographs and passing off. In his first judgment, handed down on December 20 2022, the judge found that all the causes of action relied on by Mr Price fell to be dismissed. That left only a patent infringement claim by Supawall, who claimed to be the holder of an exclusive licence from Mr Price under the patents. The judge held that Supawall’s claim in relation to the 714 patent was entitled to succeed in part but for the failure to join the true proprietor of the patent, which on his findings was not Mr Price but, because Mr Price had been made bankrupt, the Official Receiver (“the OR”). Section 67(3) of the Patents Act 1977 requires that, in any action by the exclusive licensee, the proprietor of the patent must be joined as a party. In a subsequent judgment handed down on 26 May 2023 (“the section 67 judgment”) the judge granted an application by Supawall to amend to join the OR as a party. Supawall was, accordingly, entitled to relief for patent infringement against Flitcraft. Mr Price, by contrast, was not entitled to any relief. In the course of his judgments the judge made some very serious adverse findings about the evidence which had been given on behalf of the claimants by Mr Price and by Mr Middleton, a director of Supawall, and their conduct in pursuing the claim by Mr Price to be proprietor of the patents.
The judge then proceeded to deal with the costs of the litigation. These he dealt with in a judgment handed down on 3 April 2023 (“the costs judgment”). The order which he made apportioned the costs between the patent, copyright and passing off aspects of the claims. He further apportioned the costs of the patent infringement claim as between the claim made by Mr Price as patent proprietor and Supawall as exclusive licensee. Having done that, he awarded Flitcraft its costs on the indemnity basis of the claim brought against them by Mr Price and awarded Supawall its costs of its claim against Flitcraft, subject to a reduction to take account of issues on which Supawall lost and Supawall’s conduct in giving untruthful evidence in support of Mr Price’s claim.
In the first appeal (“Flitcraft’s appeal”), Flitcraft assert that the judge should not have permitted Supawall to amend to join the OR as a party, and that, having refused permission to amend, he should have dismissed Supawall’s claim. Alternatively, Flitcraft contend that, if the amendment is to be allowed, it should be on terms that Supawall pay all the costs of the action down to the date of the amendment. There is a further discrete point concerned with the construction of the exclusive licence, which is said to extinguish Supawall’s claim.
In the second appeal (“the costs appeal”) Mr Price and Supawall contend that the judge erred in the costs order which he made. They contend that, viewed collectively, Mr Price and Supawall had been successful in the patent litigation and should have been awarded all their costs subject only to a deduction to take account of issues on which they lost.
The issues at trial and the judge’s conclusions
For the purposes of these appeals it is only necessary to set out the issues which the judge was required to decide at trial in relation to the allegations of patent infringement.
Mr Price claimed to be the proprietor of the patents. Mr Price’s case was that he was the original proprietor but that, on 28 March 2011 (shortly before he was made bankrupt) he assigned the patents to Fred Bridge who assigned them back on 14 July 2016 (after Mr Price was discharged from bankruptcy). Supawall claimed to be an exclusive licensee of the patents under a written licence granted by Mr Price on 14 October 2008. Mr Price and Supawall asserted that the Patents had been infringed by Flitcraft’s dealings with their “Old Injectawall Product”, which was marketed and sold up to around June or July 2019, and with the “New Injectawall Product”, which was marketed and sold thereafter.
Flitcraft challenged Mr Price’s claim to be the proprietor of the patents. Their primary case was that Mr Price held the patents on trust for a partnership called Maple Timber Frame of Langley (“MTF”), and that as a result of a number of further transactions the beneficial interest in the patents had become vested in Flitcraft Limited, the first defendant. In the alternative, Flitcraft contended that as a result of certain dealings with a Mr David Rich-Jones, Mr Price’s interest in the patents had been assigned to a company called Lightpeak Limited (“Lightpeak”) and that Supawall’s exclusive licence had been terminated. In the further alternative Flitcraft argued that, if the 2011 assignment to Mr Bridge was ineffective, the patents had vested in Mr Price’s trustee in bankruptcy after Mr Price was made bankrupt on 27 July 2011.
Flitcraft accepted that if, contrary to their contentions, Mr Price was the proprietor of the patents, then the Old Injectawall product infringed. They denied infringement by the New Injectawall product.
Lastly, Flitcraft asserted that, to the extent that they are liable for infringement, any sums recoverable fell within the terms of a charge over intellectual property rights dated 3 November 2009 which Mr Price gave to North West Transitional Investment Fund LLP (“the NWTIF charge”) the benefit of which had been assigned to the third defendant, Gary Flitcroft.
Continue reading this Judgment here.
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