A Point of Interest - FBT Productions, LLC v Let Them Eat Vinyl Distribution Ltd

Author Albrecht Durer "Ship of Fools"


Jane Lambert

Intellectual Property Enterprise Court (Ian Karet) FBT Productions, LLC v Let Them Eat Vinyl Distribution Ltd [2021] EWHC 1316 (IPEC) (17 May 2021)

S.15 and Sched 1 of the Administration of Justice Act 1982 inserted a new s.35A (1) into the Senior Courts Act 1981:

"Subject to rules of court, in proceedings (when-ever instituted) before the High Court for the recovery of a debt or damages there may be included in any sum for which judgement is given simple interest, at such rate as the court thinks fit or as rules of court may provide, on all or any part of the debt or damages in respect of which judgement, for all or any part of the period between the date when the cause of action arose and—
(a) in the case of any sum paid before judgement, the date of the payment; and
(b) in the case of the sum for which judgement is given, the date of the judgement."

In  FBT Productions, LLC v Let Them Eat Vinyl Distribution Ltd [2021] EWHC 932 (IPEC) (20 April 2021) which I discussed in The Inquiry - FBT Productions, LLC v Let Them Eat Vinyl Distribution Ltd. on 5 May 2021, Ian Karet, sitting as a judge of the High Court, awarded the claimant damages of £7,452.50 plus "appropriate interest".

The claimant's idea of "appropriate" interest was £1,805.55.computed as 2.5% above the three-month US LIBOR. 

The defendant disputed argued that the claimant should not receive any interest at all because it had delayed in seeking payment and then demanded "absurd sums" in damages preventing any sensible disposal of the matter. 

 If any interest was to be paid at all, then the rate should be 2.5%. This was on the basis that the damages award is in Sterling and there was no reason to apply US rates. This rate is said to be 2% over the UK base rate. That varied from 0.1% to 0.75% over the relevant period and can be averaged to 0.5%. According to the defendant. there are many commercial cases in which the court orders 1% over base rate so that its proposal of 2% over base was a concession. The defendant proposed that interest should run from (i) 5 December 2016, when the Claimant drew the copyright to the Defendant's attention, or (ii) the midpoint between 1 June 2015 and 12 January 2017 when the infringing records were withdrawn from sale. Using the first date would result in an award of £791.77. Using the second would give interest of £946.46.

Mr Karet agreed with the defendant and awarded the claimant £946.46 by way of interest.  He said at para [9] of his judgment that the overriding principle is that interest should be awarded not as compensation for the damage done but as compensation for being kept out of money that ought to have been paid.  He added at [11] that the claimant's conduct had not been such that there should be no award in this case. Having made the award in Sterling, be awarded interest on a UK basis.

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