Comic Enterprises Ltd v Twentieth Century Fox Film Corporation (No 3)

JurisdictionEngland & Wales
JudgeRoger Wyand
Judgment Date17 July 2014
Neutral Citation[2014] EWHC 2286 (Ch)
Docket NumberCase No: HC12 B 02393
CourtChancery Division
Date17 July 2014

[2014] EWHC 2286 (Ch)

IN THE HIGH COURT OF JUSTICE

CHANCERY DIVISION

INTELLECTUAL PROPERTY

Rolls Building

7 Rolls Buildings

Fetter Lane

London, EC4A 1NL

Before:

Mr Roger Wyand QC SITTING AS A DEPUTY HIGH COURT JUDGE

Case No: HC12 B 02393

Between:
Comic Enterprises Limited
Claimant
and
Twentieth Century Fox Film Corporation
Defendant

Douglas Campbell (instructed by Wragge Lawrence Graham & Co) for the Claimant

Henry Carr QC and Simon Malynicz (instructed by Simmons & Simmons LLP) for the Defendant

Hearing dates: 10 April 2014

Judgment Approved by the court for handing down

(subject to editorial corrections)

Roger Wyand QC, Deputy High Court Judge:

1

This is the judgment on the form of order hearing following judgment in the action for trade mark infringement and passing off in which I found that the Defendant had infringed the Claimant's registered trade mark but had not been guilty of passing off. There is a dispute between the parties in relation to each of the major heads of relief sought by the Claimant.

2

The heads of relief sought by the Claimant which are disputed are the following:

(A) An injunction to restrain trade mark infringement;

(B) Delivery up/destruction;

(C) An account of profits;

(D) Island Records v Tring disclosure;

(E) Publicity order; and

(F) Interim payment.

In addition, the Defendant asked for permission to appeal, which I granted at the hearing, and a stay of any disclosure, the damages enquiry (or account of profits, if one is sought), any injunction, if granted, any publicity order and any interim payment until the appeal has been finally determined.

Injunction

3

The Defendant opposes the grant of a final injunction, relying on Article 3 of the IP Enforcement Directive 2004/48/EC which governs the granting of an injunction in the event of a finding of infringement of an intellectual property right (see Arnold J in Nokia v HTC [2013] EWHC 3778 (Pat) at [26].

4

Article 3 provides:

"(1) Member States shall provide for the measures, procedures and remedies necessary to ensure the enforcement of the intellectual property rights covered by this Directive. Those measures, procedures and remedies shall be fair and equitable, and shall not be unnecessarily complicated or costly, or entail unreasonable time-limits or unwarranted delays.

(2) Those measures, procedures and remedies shall also be effective, proportionate and dissuasive and shall be applied in such a manner as to avoid the creation of barriers to legitimate trade and to provide for safeguards against their abuse."

5

The grant of an injunction in IP cases requires a balancing of the various fundamental rights under EU law. The right of intellectual property, which is to be protected in accordance with Article 17(2) of the EU Charter, is to be balanced against the right to freedom of expression, which is to be respected in accordance with Article 11 of the EU Charter, and the right of the arts to be free from constraint as provided under Article 13 of the EU Charter.

6

In Golden Eye International v Telefonica UK Ltd [2012] EWHC 723 (Ch) Arnold J described the process the court had to go through in balancing the various rights:

[117] In my judgment the correct approach to considering proportionality can be summarised in the following propositions. First, the Claimants' copyrights are property rights protected by Article 1 of the First Protocol to the ECHR and intellectual property rights within Article 17(2) of the Charter. Secondly, the right to privacy under Article 8(1) ECHR/Article 7 of the Charter and the right to the protection of personal data under Article 8 of the Charter are engaged by the present claim. Thirdly, the Claimants' copyrights are 'rights of others' within Article 8(2) ECHR/Article 52(1) of the Charter. Fourthly, the approach laid down by Lord Steyn where both Article 8 and Article 10 ECHR rights are involved in S (A child) (Identification: Restrictions on Publication), Re [2004] UKHL 47 para 17 is also applicable where a balance falls to be struck between Article 1 of the First Protocol/Article 17(2) of the Charter on the one hand and Article 8(1) ECHR/Article 7 of the Charter and Article 8 of the Charter on the other hand. That approach is as follows: (i) neither Article as such has precedence over the other; (ii) where the values under the two Articles are in conflict, an intense focus on the comparative importance of the specific rights being claimed in the individual case is necessary; (iii) the justifications for interfering with or restricting each right must be taken into account; (iv) finally, the proportionality test – or 'ultimate balancing test' – must be applied to each.

7

The Defendant also relies on Recital 2 of the IP Enforcement Directive where it states:

The protection of intellectual property should allow the inventor or creator to derive a legitimate profit from his/her invention or creation. It should also allow the widest possible dissemination of works, ideas and new know-how. At the same time, it should not hamper freedom of expression, the free movement of information, or the protection of personal data, including on the Internet.

8

Article 10 of the ECHR sets out the basic principle of freedom of expression which has been recognised as a basic principle of EU law by the Court of Justice of the European Union (the CJEU). Artistic and cultural expression fall within the parameters of Article 10 and apply not only to the substance of the ideas and information expressed but also the form in which they are conveyed. Article 10(2) of the ECHR qualifies the right to freedom of expression, so far as is relevant here, in the following terms:

The exercise of these freedoms, since it carries with it duties and responsibilities, may be subject to such … restrictions… as are prescribed by law and are necessary in a democratic society … for the protection of the … rights of others …

9

The "rights of others" referred to in Article 10(2) includes intellectual property rights such as trade mark rights. Any such restriction has to be proportionate and justified. Guidance on the principles to be applied when considering a restriction under Article 10(2) was given by Lord Bingham in R v Shayler [2003] 1 AC 247 as follows:

It is plain from the language of article 10(2), and the European Court has repeatedly held, that any national restriction on freedom of expression can be consistent with article 10(2) only if it is prescribed by law, is directed to one or more of the objectives specified in the article and is shown by the state concerned to be necessary in a democratic society. "Necessity" has been strongly interpreted: it is not synonymous with "indispensable", neither has it the flexibility of such expressions as "admissible", "ordinary", "useful", "reasonable", or "desirable": Handyside v United Kingdom (1976) 1 EHRR 737, 754, para 48. One must consider whether the interference complained of corresponded to a pressing social need, whether it was proportionate to the legitimate aim pursued and whether the reasons given by the national authority to justify it are relevant and sufficient under article 10(2): The Sunday Times v United Kingdom (1979) 2 EHRR 245, 277–278, para 62.

10

The Defendant further relies on Kelly v BBC [2001] Fam 59 for the proposition that there is a heavy evidential burden on those seeking to rely on Article 10(2) to justify the interference with freedom of expression.

11

The Defendant also points to Section 12 of the Human Rights Act 1998 as relevant to the grant of a final injunction in freedom of expression cases:

(1) This section applies if a court is considering whether to grant any relief which, if granted, might affect the exercise of the Convention right to freedom of expression.

(4) The court must have particular regard to the importance of the Convention right to freedom of expression and, where the proceedings relate to material which the respondent claims, or which appears to the court, to be journalistic, literary or artistic material (or to conduct connected with such material), to –

(a) the extent to which—

(i) the material has, or is about to, become available to the public; or

(ii) it is, or would be, in the public interest for the material to be published;

(b) any relevant privacy code.

12

Finally, the Defendant referred me to the summary of the relevant domestic principles governing the grant, refusal and tailoring of injunctions by Arnold J in HTC v Nokia [2013] EWHC 3779 (Pat) at [3] to [18] and in particular:

[11] There is a considerable body of authority in the application of these principles in real property cases. It is clear from this case law that, in considering whether the grant of an injunction would be oppressive, the extent to which the claimant asserted his rights, what knowledge the defendant had of the claimant's rights when and what the defendant did when faced with the problem are particularly relevant considerations. Whether the claimant sought an interim injunction and whether the defendant sought negative declaratory relief appear to be relevant factors, but the weight of these factors appears to vary from case to case. A potentially decisive factor is if the claimant makes it clear that all he is really interested in is money. This is illustrated by Gafford v Graham 77 P&CR 73.

13

The Claimant referred me to the case of Coventry v Lawrence [2014] UKSC 13 in which Lord Neuberger, with whom the others agreed, quoted A L Smith LJ in Shelfer v City of London Electric Lighting Co [1895] 1 Ch 287 where he said:

"A person by committing a wrongful act (whether it be a public company for public purposes or a private individual) is not thereby entitled to ask the court to sanction his doing so by purchasing his neighbour's rights, by assessing damages in that behalf, leaving his neighbour with the nuisance,...

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    ...446 cited above). 11 This approach was applied as recently as 2014 in Comic Enterprises Ltd v Twentieth Century Fox Film Corporation [2014] IP & T 1008[47] – [48]. So entrenched has the practice become in England that the order is known as an Island Records v Tring disclosure. 12 The Privy ......
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    ...considered in the past by Judge Birss sitting in the Patents County Court (as he and it then were) in cases such as Comic Enterprise Ltd v Twentieth Century Fox Film Corp [2012] EWPCC 1 In that case the judge also reviewed some of his earlier decisions such as Alk-Abello Ltd v Meridian Medi......

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