Photobooth Props Ltd v Nepbh Ltd
| Jurisdiction | England & Wales |
| Judge | John Kimbell |
| Judgment Date | 01 April 2022 |
| Neutral Citation | [2022] EWHC 750 (IPEC) |
| Docket Number | Case No.: IP 2021-2021-NCL-000002 |
| Court | Intellectual Property Enterprise Court |
[2022] EWHC 750 (IPEC)
IN THE HIGH COURT OF JUSTICE
BUSINESS AND PROPERTY COURTS OF ENGLAND AND WALES
INTELLECTUAL PROPERTY ENTERPRISE COURT (Ch.D)
Royal Courts of Justice
Rolls Building, London, EC4A 1NL
John Kimbell QC, sitting as a Deputy High Court Judge
Case No.: IP 2021-2021-NCL-000002
Stefanie Wickenden, instructed by McDaniels & Co., for the Claimants
Jonathan Rodger, instructed by Sintons LLP, for the Defendants
Hearing date 24 February 2022
APPROVED JUDGMENT
This judgment was handed down remotely by circulation to the parties' representatives by email and released to BAILII. The date and time for hand-down is deemed to be 10.30 a.m. on Friday 1 April 2022
John Kimbell QC sitting as a Deputy High Court Judge:
Introduction
These proceedings concern a dispute between two SMEs who compete in the niche world of photobooths and associated accessories. The photobooths are the type where you step in, sit down, draw a curtain and wait for a number of photographs to be taken automatically. The photographs then appear a few minutes later in a slot on the outside of the booth. Photobooths of this type are now apparently a common feature at birthday parties, weddings and other events.
The panels on the outside of the photobooths are used to provide thematic decoration appropriate to the event. The relevant designs are printed out as “skins” and inserted around the outside of the booth. The purpose of the skin design is to entice people in and to complement the atmosphere of the party or event in question.
The First Claimant (‘ PPL’) is a company which carries on the business of offering photobooths for hire. It also supplies skins for the booths and other accessories. The Second Claimant (‘ LPL’) is a company which designs and prints, skins, props and panels for use with photobooths. The people behind PPL and LPL are Mr Paul Sherrington and Ms Lie Xie. They are both directors and employees of PPL and LPL.
The First Defendant (‘ NEPBH’) is (or was) in the business of printing and supplying photobooth skins. The Second Defendant (‘ QuinnUK’) is a company whose sole director is the Third Defendant (‘ Mrs Quinn’). The sole director of NEPBH is the Fourth Defendant, who is one of Mrs Quinn's sons. The Fifth Defendant (‘ Mr Quinn’) is married to the Third Defendant. The Eight Defendant is the brother of the Fourth Defendant. The Sixth Defendant (‘ D6’) and Seventh Defendants (‘ D7’) are companies which supply accessories and equipment related to photobooths. The Claimants allege that NEPBH, D6 and D7 are all under the control of Mr Quinn.
The Claimants seek damages and an injunction arising out of alleged infringement of copyright in certain design works. Some of these works are new works said to have been created by Ms Xie (‘ the New Works’). The other works in issue (‘ the Assigned Works’) are said to have been acquired as part of the sale of NEPBH's business to LPL by means of an oral contract entered into in July 2019 (‘ the July Contract’).
The Claimants seek recission of the July Contract and damages on the grounds that there were induced to enter into it by fraudulent misrepresentations made by Mr Quinn.
The pleaded misrepresentations are set out in paragraph 21 (c), (d) and 22 of the Particulars of Claim. The Claimants go on to allege in paragraph 48 that these misrepresentations were made fraudulently.
In their Defence, the Defendants deny any misrepresentations were made. They further deny that the Claimants are “entitled to any relief in copyright”.
The Defendants admit a contract of sale was entered into in July 2019 with LPL but say as follows (in paragraph 4 of the Defence):
“The Defendants did not sell a business to [LPL]. Rather—
(1) [QuinnUK] sold to [LPL] a large format printer, a laminator, various website domain names and the designs offered for sale thereon;
(2) [Mr Quinn] sold to [LPL] stock consisting of print consumables and media.
In paragraph 20, the Defendants plead that the July Contract contained the following terms:
(1) The Quinns would sell and Mr Sherrington would buy the Printer, the Laminator, the Stock and the Websites at a price of £40,000 plus the cost price of the stock.
(2) The price would be paid as to £15,000 plus the cost price of the stock on completion followed by four monthly instalments of £6,250 each.
(3) Until the price was fully paid, the Printer, the Laminator and the Stock would remain in situ in the Quinns' unit and Mr Sherrington would rent the room in which they stood for £500 per month.
Paragraph 22 of the Defence says in relation to title to the Assigned Works: “For the further avoidance of doubt, at no time prior to the making of the contract did Mr Sherrington ask or the Quinns speak about the images and designs on the website”. This would appear to suggest that title to any design work was not part of the July Contract at all.
However, paragraph 24 of the Defence appears to admit that ownership in at least some designs was in fact transferred. It says “the Quinns transferred the Printer, the Laminator, the Stock and the Websites (including the designs offered for sale thereon)”. In a witness statement dated 16 February 2022, Mr Quinn accepted that the rights to fifteen designs owned by QuinnUK were sold to Mr Sherrington. The images in question are exhibited to the statement at pages 1 – 15 of exhibit ‘MQ1’. Mr Quinn goes on to say that these are the only images which were “sold for exclusive use”.
The Claimants served a Reply on 1 September 2021. This was followed on 27 October 2021 by a notice to admit facts in the following terms:
1. As at the conclusion of the agreement between the Claimants and Defendants for the sale of assets (the details and terms of which will be determined at trial) the Second Claimant was the owner of copyright in each of the Assigned Works 1–3, 16, 20–21, 26, 30, 35 (as defined in the Particulars of Claim).
2. The Fifth to Seventh Defendants have between them:
a. copied the whole or a substantial part of each of Cs' New Works (as defined in the Particulars of Claim);
b. issued copies of Cs' New Works to the public;
c. copied the whole or a substantial part of each of the Assigned Works; and
d. issued copies of the Assigned Works to the public.
By a letter sent on 25 November 2021, the Defendants confirmed that they do not admit the facts they were invited to admit in the Notice.
The case management conference
A case management conference was originally listed for 7 December 2021. However, that was vacated at the request of the Defendants because they requested a full day listing to deal with the application for summary judgment that had been issued by the Claimants on 25 November 2021 and because the Defendants stated that they intended to issue a number of applications of their own.
The Applications
(1) The Claimants' application
The Claimants' application for summary judgment was in the following terms:
“The Claimants seek an Order pursuant to CPR 24.2(a)(ii) entering summary judgment against the Sixth Defendant and Seventh Defendant in respect of liability for copyright infringement in the works set out at (1) and (2) below, and against the Fourth, Fifth and Eighth Defendants in respect of the issues of substance, ownership and infringement by the Sixth and Seventh Defendants of copyright in relation to the same:
(1) the Assigned Works 1–3, 16, 21, 26, 30, 35 (as defined in the Particulars of Claim and listed in the Notice to Admit dated 27 October 2021); and
(2) New Works 2–4 and 6–7 (as defined in the Particulars of Claim).
The Claimants seek this order as the Defendants have no real prospect of successfully defending the claim and there is no other compelling reason why these issues should be disposed of at trial”
The application was supported by a witness statement of Adam Turley dated 25 November 2021.
(2) The Defendants' applications
The Defendants' applications were issued on 16 February 2022. The Defendants' first application was for an order striking out “the claim in fraudulent misrepresentation”. The second application was for security for costs. The applications were both supported by a single witness statement of Mr Quinn dated 16 February 2022. That witness statement also contained, at paragraphs 5 – 19, a response to the Claimants' summary judgment application.
Because the Defendant sought to put in at the last minute a supplementary bundle containing company accounts, I gave both parties an opportunity to make further submissions in writing in relation to security for costs. The Claimant served a short witness statement from Mr Sherrington dated 2 March 2022.
The summary judgment application
CPR Part 24.2 provides:
“The court may give summary judgment against a claimant or defendant on the whole of a claim or on a particular issue if—
(a) it considers that
(i) that claimant has no real prospect of succeeding on the claim or issue; or
(ii) that defendant has no real prospect of successfully defending the claim or issue; and
(b) there is no other compelling reason why the case or issue should be disposed of at a trial.”
There was no dispute about the applicable principles. They are summarized in para. 24.2.3 of Volume 1 of the 2021 White Book as follows:
“The following principles applicable to applications for summary judgment were formulated by Lewison J in Easyair Ltd v Opal Telecom Ltd [2009] EWHC 339 (Ch) at [15] and approved by the Court of Appeal in AC Ward & Sons Ltd v Catlin (Five) Ltd [2009] EWCA Civ 1098; [2010] Lloyd's Rep. I.R....
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Photobooth Props Ltd v Nepbh Ltd
...The date and time for hand-down is deemed to be 10.30 a.m. on Monday 27 June 2022 Introduction 1 In my judgment dated 1 April 2022 [2022] EWHC 750 (IPEC) I dealt with three applications (‘ the Applications’): an application for summary judgment by the Claimants and a strike out and securit......