Costs: Amsterdam "nearer Newport" than other parts of UK, rules IPO

From Amsterdam ...

In Loadhog Ltd v Polymer Logistics BV, BL O/337/10, 29 September 2010, the UK's Intellectual Property Office was faced with a challenge to a costs claim in favour of Polymer, the defendant patent proprietor, in failed revocation proceedings. Polymer's costs claim applied the "evidence" element set out in Tribunal Practice Notice 4/2007 ("Preparing evidence and considering and commenting on the other side's evidence") in respect of each piece of evidence filed in the proceedings. The IPO hearing officer held that this was not the way the scale was meant to be applied and that the evidence element of any costs order should be between £500 and £2,000 in total, not per item: in general, if any item in the table was applied more than once in any award of costs, this would defeat one of the fundamental purposes of the published scale -- predictability of costs.

One area in which Polymer did succeed was in its costs claim for the cost of importing and accommodating a Dutch expert witness, who arrived at Newport in rather unusual circumstances:

... to Newport, by boat?

"7 I have examined the travel and accommodation expenses for the defendant’s expert witness, and I am satisfied that they are reasonable in the circumstances. I have therefore awarded the full amount sought in this category. The claimant has commented that the mileage element of Mr ten Bok’s travel expenses is high because the claimant chose to rely on an expert witness from Holland. I don’t know where in Holland Mr ten Bok lives, but I note that Amsterdam (roughly in the centre of Holland) is closer to Newport than some parts of the UK.

8 Moreover it is likely that when the defendant chose Mr ten Bok as their expert witness for this case, they anticipated that he would fly to the UK if required to attend a hearing. (In the event, when the time came for Mr ten Bok to attend the hearing to be cross-examined, a cloud of ash from an Icelandic volcano had closed European airspace and he had to drive to the hearing.)

9 The defendant has claimed three nights’ hotel expenses for Mr ten Bok in relation to his attendance at the hearing. Although Mr ten Bok’s cross-examination was concluded during the first day of the hearing, I think it is reasonable that the defendant should want to make sure that he was available during the second day, either to support its legal team or in case he was required to clarify some part of his evidence".

Okay to split costs where actions are joined, says CA

Actavis UK Ltd v Eli Lilly & Co. Ltd, 13 January 2010, doesn't seem to have found its way on to BAILII yet, but this ruling of the Court of Appeal for England and Wales (Lords Justice Jacob, Lloyd and Stanley Burnton) was caught by subscription service Lawtel. According to the keynote,

"An order for costs requiring two pharmaceutical companies, which had unsuccessfully applied for the revocation of a patent, to split equally the costs of the successful party could not be criticised as the two actions were indistinguishable and the bulk of costs incurred by the successful party arose from defeating both claims".

The two revocation actions -- each brought by a pharmaceutical company-- were originally independent, the second action being brought through the applicant's anxiety that the first applicant might obtain a market advantage. A case management conference directed that the two actions be heard simultaneously before the same judge, that the evidence given in the one case would serve as evidence given in the other. The two actions subsequently proceeded together but, before trial, one of the applicants for revocation discontinued its application.

The question of an order for consequential costs was stood over until the outcome of the trial was known. After the patent was held valid both at trial and on appeal, the patent owner stated that the substantial majority of its costs were incurred in seeking to defeat both actions, and that the additional costs incurred once the second revocation application was dropped were relatively small. The judge ordered that the costs of the patent owner's action be split equally between the two applicants for revocation since (i) it was impossible to distinguish between the two actions and (ii) the vast majority of its costs were attributable to both actions.

The Court of Appeal affirmed that this approach reflected the fact that the judge had a wide discretion and had exercised it properly. Nor was it contrary to the spirit of the Civil Procedure Rules to hold the applicants equally accountable for the costs -- though a different result might have occurred, had the two prepared their cases completely separately from each other.