Practice: Juul Labs, Inc. and Others v MFP Enterprises Ltd.
|A Person using a Juul Device|
Patents Court (Mr Justice Mann) Juul Labs, Inc and others v MFP Enterprises Ltd (t/a 'Smoke Nation' and others)  EWHC 3380 (Pat) (10 Dec 2020)
This was an application for summary as well as default judgment against defendants that had not acknowledged service of the claim form or particulars of claim. Such applications are rare because CPR 24.4 (1) prohibits a claimant from applying for summary judgment until the defendant against whom the application is made has filed an acknowledgement of service or a defence unless the court has given permission or a practice direction provides otherwise.The circumstances in which a court may give permission were considered by Mr Justice Bryan in The European Union and another v The Syrian Arab Republic  EWHC 1712 (Comm) (29 June 2018) and Mr Justice Hensaw in DVB Bank SE v Vega Marine Ltd and others  EWHC 1494 (Comm) (10 June 2020). Mr Justice Bryan said in the Syrian case:
"(1) The purpose of the rule is to ensure that no application for summary judgment is made before a defendant has had an opportunity to participate in the proceedings and to protect a defendant who wishes to challenge the Court's jurisdiction from having to engage on the merits pending such application.
(2) Generally, permission should be granted only where the Court is satisfied that the claim has been validly served and that the Court has jurisdiction to hear it. Once those conditions are met there is generally no reason why the Court should prevent a claimant with a legitimate claim from seeking summary judgment.
(3) The fact that a summary judgment may be more readily enforced in other jurisdictions than a default judgment is a 'proper reason for seeking permission under CPR 24.4(1) ."
"I would add, in relation to (3), that it would in my view be sufficient that the claimant has a reasonable belief that a summary judgment may be more readily enforced than a default judgment. There is no justification for the court subjecting any such belief to minute examination when the permission the claimant is seeking is in reality no more than the opportunity to obtain a reasoned judgment on the merits of its claim".
(1) There must, in general, be a real and present dispute between the parties before the court as to the existence or extent of a legal right between them. However, the claimant does not need to have a present cause of action against the defendant… A present dispute over a right or obligation that may only arise if a future contingency occurs may well be suitable for declaratory relief and amount to a real and present dispute….
(2) Each party must, in general, be affected by the court's determination of the issues concerning the legal right in question…
(3) The fact that the claimant is not a party to the relevant contract in respect of which such a declaration is sought is not fatal to an application for a declaration, provided that the claimant is directly affected by the issue… In such cases, however, the court ought to proceed very cautiously when considering whether to make the declaration sought….
(4) The court will be prepared to give declaratory relief in respect of a "friendly action" or where there is an "academic question", if all parties so wish, even on "private law" issues. This may be particularly so if the case is a test case or the case may affect a significant number of other cases, and it is in the public interest to decide the point in issue…
(5) The court must be satisfied that all sides of the argument will be fully and properly put. It must, therefore, ensure that all those affected are either before it or will have their arguments put before the court… For this reason, the court ought not to make declarations without trial… In Wallersteiner v. Moir, Buckley LJ said this:
'It has always been my experience and I believe it to be a practice of very long standing, that the court does not make declarations of right either on admissions or in default of pleading. A statement on this subject of respectable antiquity is to be found in Williams v. Powell  WN 141, where Kekewich J, whose views on the practice of the Chancery Division have always been regarded with much respect, said that a declaration by the court was a judicial act, and ought not to be made on admissions of the parties or on consent, but only if the court was satisfied by evidence. If declarations ought not to be made on admissions or by consent, a fortiori they should not be made in default of defence, and a fortissimo, if I may be allowed the expression, not where the declaration is that the defendant in default of defence has acted fraudulently…'
(6) In all cases, assuming that the other tests are satisfied, the court must ask: is this the most effective way of resolving the issues raised? In answering that question, the court must consider the other options of resolving the issue."
"It is true to say that the court now looks more favourably on granting declarations by consent, or in "friendly" actions, than used to be the case. It may also be appropriate in some cases to grant a declaration on a summary judgment application rather than a trial, provided that the facts are clearly established. However, in all such cases there has to be a good reason for such actions, and in all those cases there is at least some level of activity by both parties which is missing from this application – see the notes in the White Book (2020 Edition) at para 40.20.3. Where one side is absent the court has to approach the above factors with even more care."
"(a) There is no active dispute between the parties. The defendants have not engaged with the proceedings, and while it can be anticipated that the defendants would not agree to the relief being sought against them, they have not raised an actual dispute. Even if one accepts they would be hostile to the claim, they have not raised the Article 14 response to the apparent infringement of the mark, which is what the declarations go to. The court is therefore not invited to determine an actual issue between the parties.
(b) The other side of the Article 14 argument, which the claimants wish me to rule against, has not been put. Mr Moody-Stuart has, quite properly, pointed out a number of points which might be taken against him on the whole application, as is his duty, but the defendants' side of the Article 14 point has not been argued fully. In this case this is a very important factor. As will appear below, even without argument it seems to me to be quite likely that the claim to at least some of the declarations will fail.
(c) As between the parties, the declarations are academic because they have not raised the point and the claimants have all the relief they need on the default judgment.
(d) The declarations may well have an effect on third parties. That is not a side-effect, as in Bank Mellon (see para 22, end); it is the main purpose of the declaration. Marcus Smith J held that the effect on an unrepresented third party was an important factor pointing against the making of the declaration. Again I respectfully agree. I develop this point a little more below."