Pacific Rim (Respondent /Claimant) v Pkf Group

This is an application for permission to appeal by the Defendant against a case management decision of HHJ Hacon, sitting in the Intellectual Property Enterprise Court ("IPEC") on 23 March 2015. The Defendant seeks to appeal against the Judge's order dismissing three applications brought by the Defendant at that hearing. The first was for permission to re-amend the Defence and Counterclaim (essentially to raise prior use by the patentee/Claimant. The other two, related, applications sought disclosure of documents from two third parties.

Permission to appeal has not yet been granted. I have decided to grant permission for two reasons: first, the parties are here, full skeletons have been prepared and I have listened to the arguments; and secondly, I consider that this case raises some points of practice of general application to IPEC. However, in granting permission to appeal I have to remind myself of the principles on which the appellate tribunal should proceed. This was an exercise of discretion by the judge. In G v G [1985] UKHL 13 Lord Fraser of Tullybelton said at:

"…the appellate court should only interfere when they consider that the judge of first instance has not merely preferred an imperfect solution which is different from an alternative imperfect solution which the Court of Appeal might or would have adopted, but has exceeded the generous ambit within which a reasonable disagreement is possible."

I was also referred by Mr Longstaff, who appeared on behalf of the Respondent, to the following passage in Eagil Trust Co. v Pigott-Brown [1985] 3 All ER 119:

"In the case of a discretionary exercise, as in other decisions on facts or law, the judge should set out his reasons, but the particularity with which he is required to set them out must depend on the circumstances of the case before him and the nature of the decision he is giving. When dealing with an application in chambers to strike out for want of prosecution, a judge should give his reasons in sufficient detail to show the Court of Appeal the principles on which he has acted, and the reasons which led him to his decision. They need not be elaborate. I cannot stress too strongly that there is no duty on a judge, in giving his reasons to deal with every argument presented by counsel in support of his case. It is sufficient if what he says shows the parties and, if need be, the Court of Appeal the basis on which he has acted, and if it be that the judge has not dealt with some particular argument but it can be seen that there are grounds on which he would have been entitled to reject it, this court should assume he acted on those grounds unless the appellant can point to convincing reasons leading to a contrary conclusion."

In summary, when turning to the decision of Judge Hacon I shall consider whether this is a decision that the judge was entitled to reach and will only reconsider his conclusion if there is some clear and distinct error of law or principle.

Judge Hacon gave a judgment and a supplemental judgment, both of which were delivered ex tempore. In his main judgment, the judge referred at [1]–[3] to the application to re-amend the Defence and Counterclaim to plead that the Claimant had disclosed the invention claimed in patent in suit before the priority date. He pointed out that there were two categories of this alleged prior disclosure. The first was disclosure of the the patented product, that is to say, three layer doors, to third parties who were responsible for testing the doors in order to grant certificates to show that the doors satisfied certain requirements. The second was disclosure to third parties who were alleged to have sold the doors on to users. The disclosure pursued on this appeal related to third party testers of doors.

The judge then considered various submissions on behalf of the Claimant on that occasion as to why the allegations of prior use were extremely weak. The judge did not accept those submissions. He considered at [11] that whether the allegations were strong or weak depended on what the disclosure might show. In other words, the strength of the allegations depended on whether any document showed prior public disclosure. It is clear from his judgment that, had this been a case in the High Court, he would have allowed the amendment on the basis that the pleading could not be struck out and the Claimant could be compensated in costs if the allegations turned to be incorrect.

However, at [14] Judge Hacon referred to CPR 63.23 and in particular 63.23(1) and (2):

"(1) At the first case management conference after those defendants who intend to file and serve a defence have done so, the court will identify the issues and decide whether to make an order in accordance with paragraph 29.1 of Practice Direction 63."

"(2) Save in exceptional circumstances the court will not permit a party to submit material in addition to that ordered under paragraph (1)."

He then said:

"15. It seems to me that the inevitable consequence of allowing the proposed amendment to the pleading, and [in particular] if the disclosure is allowed, further material, that is to say documents obtained from the third parties, would be submitted in addition to that which was ordered at the CMC. The CMC took place on 20 November 2013 in front of Arnold J and, as is common ground, none of the points raised today were raised before Arnold J.

16. Generally speaking, exceptional circumstances require the party seeking to adduce such further material to show that they could not have obtained the material with reasonable diligence by the time of the first CMC. I am told what prompted this application to amend and the disclosure sought was a response given to a Part 18 Request, that is to say a response by the Claimant. That response came on 25 October 2013, so about a month before the CMC. The question is whether the Defendant could, with reasonable diligence, have found in particular the archived Latham websites [which showed, before the priority date, sales of panels using the trade mark under which the patented product is now sold] within that month so that essentially the applications before me today could have been made before Arnold J on 20 November 2013. I was told on instructions that obtaining this material took some time and only started after the initial step of just writing to Lathams and asking for the material was taken.

17. The difficulty I have is that there is no evidence before me to substantiate that delay and what I think weighs quite heavily in my mind is that it is now well over a year, close to 18 months, after the first CMC that this matter has now reached this court. That does suggest to me that the Defendant has taken a rather casual approach to making this application and by inference may have been rather too casual in making sure that all matters were before the court at the CMC before Arnold J.

18. CPR 63 .23(2) must be given proper attention if this court is to avoid late applications of this kind. It is finally for that reason that I take the view that the applications should be refused."

After the judge had given his main judgment, Mr Wright, who appeared before me and put his submissions on this appeal in a very attractive and concise manner, corrected Judge Hacon as to a date to which he had referred in that judgment. The judge then gave a supplementary judgment, recognising that the applications were dated 12 March 2014 and 15 April 2014,...