Why we needed to reform the Patents County Court: Deakin and National Guild

There are two new judgments from the Patents County Court on BAILII (British and Irish Legal Information Institute):

• Deakin and Another (t/a Faith Image Source) v Card Rax Ltd and Others [2011] EWPCC 3 (1 Feb 2011) and
• National Guild Of Removers & Storers Ltd v Jones and Another (t/as ATR Removals)[2011] EWPCC 4 (9 Feb 2011).

Deakin

Deakin was the trial of an action and counterclaim for damages for breach of contract with incidental copyright issues that had been brought under the old CPR Part 63 and Part 63 Practice Direction relating to designs for greetings cards. gift wrap paper and other stationery. There was a re-re amended particulars of claim and two amended defences which gave rise to 65 issues. The trial had taken place before His Honour Judge Fysh QC over 10 days of May, June and July 2010 and judgment was delivered on 1 Feb 2011.

National Guild

National Guild, by contrast, was an inquiry as to damages for trade mark infringement very similar to the same claimant's claim against Silveria which I blogged on 12 Nov 2010. The claimant was a trade association which had allowed its members to use its logo in their advertising so longs as they paid their subs. As in Silveria the defendants had once been members of the National Guild but had ceased to be such. Nevertheless, they continued to display the claimant's logo on their website and in the telephone directory after their membership had ended.

Points of Law

Deakin revolved largely on fact but Judge Fysh QC decided one important point of law: when a copyright licensee fails to pay a licence fee is he or she liable in debt for the unpaid fee or can he or she be sued for infringement of copyright? The point had arisen in Australia in Ng v Clyde Securities Ltd. [1976] 1 NSWLR 443 and Concrete Pty Ltd v Parramatta Design and Developments Pty Ltd [2006] HCA 55, (2006) 231 ALR 663, (2006) 81 ALJR 352 (6 Dec 2006). Counsel for the claimants had argued that Ng should not be followed in England. His Honour held that non-payment of a licence fee does not terminate or justify termination of a licence.

In National Guild the defendants who appeared in person had advanced the following arguments:

"i) He contended that the damages owed should be the annual fee the guild charges for its members. Mr Jones contended that fee he paid was £1,000 per year and that represents the right rate to use
ii) He contended that the figure proposed by the claimant was out of scale with the value to his business of the use of the guild's marks.
iii) He contended that the period during which ATR Removals should be regarded as a member of the guild should continue for a further six months beyond July 2009 to take account of the guild's delays in sending him the marketing materials he should have received as a member.
iv) He contended that the letter in September 2009 should set the date of the end of his membership and not July 2009.
v) He contended that marks on the internet were seen by many more customers and potential customers than marks used in the paper directory and the damages ought to reflect that."

Judge Birss QC held that some of those were good to the extent that they entitled the defendants to a reduction in damages. However, the main point of his judgment was that in cases where a mark is "available for hire" damages should be computed on the user principle rather than for the diminution of the value of the mark as a thing in action.