Summary Judgment - JBC Distributors Inc v Pak Cosmetic Centre
Intellectual Property Enterprise Court (Pat Treacy) JBC Distributors Inc and another v Mudahy (t/a Pak Cosmetic Centre) and another [2023] EWHC 1480 (IPEC) (23 June 2023)
This was an application for summary judgement on a claim for trade mark infringement and the striking out of a defence and counterclaim for groundless threats and reimbursement for unsold stocks returned by Sainsbury's The applications came on before Pat Treacy sitting as a deputy judge of the High Court on 9 June 2023. By para [43] of her judgment which she handed down on 23 June 2023, the learned deputy judge dismissed the summary judgment application and the application to strike out the defence (see JBC Distributors Inc and another v Mudahy (t/a Pak Cosmetic Centre) and another [2023] EWHC 1480). She also struck out the counterclaim for reimbursement for unsold stocks but not the counterclaim for unjustified threats.
The Claim
The claimant is the registered proprietor of the word mark SUNNY ISLE which is registered for hair oils, castor oil for cosmetic purposes and body oils in class 3 under trade mark number UK00003332497 with effect from 17 Aug 2018. It complains that the defendants have infringed its trade marks and passed off counterfeit goods as and for the claimant's.
The Defence and Counterclaim
The defendants denied infringement and passing off on the grounds that they acquired their stocks from the claimant or its authorized distributors. They alleged that the claimant had changed its packaging after they had bought their stocks. They counterclaimed for groundless threats and the losses arising from the return of products by Saiusbuty as a direct result of the infringement claim.
The Application
The claunant relied on CPR 3.4 (2) (a) and CPR 24.2. Ms Treacy summarized the combined effect of those provisions in paras [11] and [12] of her judgment:
"[T1] To summarise, CPR 3.4(2)(a) enables the Court to strike out the whole or part of a statement of case which discloses no reasonable grounds for bringing or defending a claim. This may be:
- where the pleading consists of a bare assertion (for example, in the case of a defence, a bare denial) or sets out no coherent statement of facts; or
- where the facts it sets out, while coherent would not, even if true, amount in law to a defence or the basis for a claim because they disclose no reasonable grounds for bringing or defending a claim.
"… the court must be careful before giving summary judgment on a claim. The correct approach on applications by defendants is, in my judgment, as follows:
i) The court must consider whether the claimant has a "realistic" as opposed to a "fanciful" prospect of success: Swain v Hillman [2001] 2 All ER 91;
ii) A "realistic" claim is one that carries some degree of conviction. This means a claim that is more than merely arguable: ED & F Man Liquid Products v Patel [2003] EWCA Civ 472 at [8]
iii) In reaching its conclusion the court must not conduct a "mini-trial": Swain v Hillman
iv) This does not mean that the court must take at face value and without analysis everything that a claimant says in his statements before the court. In some cases it may be clear that there is no real substance in factual assertions made, particularly if contradicted by contemporaneous documents: ED & F Man Liquid Products v Patel at [10]
v) However, in reaching its conclusion the court must take into account not only the evidence actually placed before it on the application for summary judgment, but also the evidence that can reasonably be expected to be available at trial: Royal Brompton Hospital NHS Trust v Hammond (No 5) [2001] EWCA Civ 550;
vi) Although a case may turn out at trial not to be really complicated, it does not follow that it should be decided without the fuller investigation into the facts at trial than is possible or permissible on summary judgment. Thus the court should hesitate about making a final decision without a trial, even where there is no obvious conflict of fact at the time of the application, where reasonable grounds exist for believing that a fuller investigation into the facts of the case would add to or alter the evidence available to a trial judge and so affect the outcome of the case: Doncaster Pharmaceuticals Group Ltd v Bolton Pharmaceutical Co 100 Ltd [2007] FSR 63;
vii) On the other hand it is not uncommon for an application under Part 24 to give rise to a short point of law or construction and, if the court is satisfied that it has before it all the evidence necessary for the proper determination of the question and that the parties have had an adequate opportunity to address it in argument, it should grasp the nettle and decide it. The reason is quite simple: if the respondent's case is bad in law, he will in truth have no real prospect of succeeding on his claim or successfully defending the claim against him, as the case may be. Similarly, if the applicant's case is bad in law, the sooner that is determined, the better. If it is possible to show by evidence that although material in the form of documents or oral evidence that would put the documents in another light is not currently before the court, such material is likely to exist and can be expected to be available at trial, it would be wrong to give summary judgment because there would be a real, as opposed to a fanciful, prospect of success. However, it is not enough simply to argue that the case should be allowed to go to trial because something may turn up which would have a bearing on the question of construction: ICI Chemicals & Polymers Ltd v TTE Training Ltd [2007] EWCA Civ 725."
She directed herself at [38] that the main question was whether the defence had a realistic prospect of success or whether it was merely fanciful. In her view, the defendant's case carried a degree of conviction. Such conviction might be misplaced but as far as was apparent in the brief time available to review the pleadings and evidence on a summary basis, was not perfunctory. Documentary evidence had been provided which was relevant to factual aspects which had been put in issue. Those issues could only be determined at trial.
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