Tech 21 UK Ltd v Logitech Europe S.A.
| Jurisdiction | England & Wales |
| Judge | Stephen Jourdan |
| Judgment Date | 15 September 2015 |
| Neutral Citation | [2015] EWHC 2614 (Ch) |
| Docket Number | CLAIM NO HC14D03614 |
| Court | Chancery Division |
| Date | 15 September 2015 |
[2015] EWHC 2614 (Ch)
IN THE HIGH COURT OF JUSTICE
CHANCERY DIVISION
Royal Courts of Justice
Rolls Building, Fetter Lane
London EC4A 1NL
Stephen Jourdan QC
SITTING AS A DEPUTY HIGH COURT JUDGE
CLAIM NO HC14D03614
Tom Alkin (instructed by Charles Russell Speechlys LLP) for the Claimant
Hugo Cuddigan QC (instructed by HGF Law LLP) for the Defendant
Hearing date: 5 June 2015
Stephen Jourdan QC sitting as a deputy High Court judge
Introduction
On 15 September 2014, the Claimant, Tech 21 UK Limited ("Tech21") issued a claim form. In it, Tech21 claimed two declarations against the Defendant, Logitech Europe SA ("Logitech"). First, that Tech21 has not infringed and will not infringe any Community unregistered design right owned by Logitech by making, processing, offering, putting on the market, importing, exporting or using protective iPad Air and/or iPad mini cases sold under the name "Impact Folio" within the European Community, nor any UK unregistered design right or other rights subsisting in the same designs. Second, that Logitech has made unjustifiable threats to bring proceedings for infringement of Community unregistered design right in respect of Tech21's possessing, offering, putting on the market, and/or using such cases. The claim form also claimed an injunction to restrain further such threats, dissemination of the judgment and costs.
On 22 December 2014, the claim form was served, with Particulars of Claim, on Logitech at its registered office in Lausanne, Switzerland. The Particulars of Claim claimed similar declarations to the claim form, although not specifically mentioning UK unregistered design right, and also an order for dissemination and publication of the judgment and declarations, an inquiry as to damages and an order for payment of all sums found due on the inquiry with interest.
On 26 January 2015, Logitech issued an application for a declaration that the Court has no jurisdiction over this claim and an order that the claim form should be set aside. That was supported by a witness statement made by Mr Stettler dated 25 January 2015.
Directions for the hearing of that application by a judge were then made by consent. Tech 21 then filed a witness statement of Mr Cass, Tech21's finance director, dated 1 May 2015. This did not contradict Mr Stettler's statement but supplied additional evidence. Although the directions provided for Logitech to serve evidence in reply, no further evidence was served. There are no disputes of fact relevant to the issues which I have to decide.
The facts
Logitech, a Swiss company, is a member of the wider Logitech group of companies. The Logitech group is a well known manufacturer of accessories for electronic devices, particularly computers and tablets. Tech21 is a UK company which specialises in impact protection cases for tablets and smartphones. Logitech has establishments in two EU member States, the Netherlands and Croatia.
In January 2013, the parties entered into commercial negotiations with a view to collaborating on the design of a range of cases to be sold by Logitech. On 30 January 2013, the parties signed a non-disclosure agreement ("the NDA") to facilitate exchange of information. In October 2013, following various design discussions, the parties signed a manufacturing and sales agreement ("the MSA"). The commercial relationship did not prosper, leading to the termination of the MSA in January 2014.
In the spring/summer of 2014, both parties launched their own lines of impact protection cases for iPads. The Logitech product was called "Big Bang", the Tech21 product "Impact Folio".
In July 2014, Logitech became aware that Tech21 was distributing the Impact Folio cases at the Apple Store in Regent Street in London. Subsequently, in August, Logitech became aware that Tech21 was distributing the same product in Germany. A test purchase was made at the Apple Store in Cologne. The design of the Impact Folio case was almost identical to that of the Big Bang case.
On 10 September 2014, Tech21 received a letter from Jonas, a German law firm in Cologne acting for Logitech ("the Letter"). This said:
"We are representing our client Logitech Europe S.A., Daniel Borel Innovation Center, CH-1015 Lausanne, Switzerland in matters of Intellectual Property.
We have been informed that you entered into a manufacturing and sales agreement with our client dated October 11, 2013 that covers inter alia the development, manufacturing and sale of tablet products for and to our client. You were asked to develop for manufacturing the products based on our client's designs that were presented to you by Logitech and by Design Partners, a partner company of our client. Furthermore it was agreed that our client will maintain exclusive ownership rights to the design and product intellectual property. Moreover, you have undertaken not to take our client's designs, IP and/or discussions and reproduce a Tech21 or other branded version of the product and that such rights will survive termination (see Schedule G, "IP Rights").
Therefore, our client is the exclusive owner of all IP rights including design rights that have been implemented in its protective Pad Air/ Ipad mini cases "Big Bang" which is based on the design of our client and has been put on the European market some months ago. Moreover, considering the innovative and unique design of the Big Bang products our client has become the owner of an unregistered Community Design accordingly.
Our client noticed recently that you are distributing a protective case for iPad Air/ Ipad Mini named "IMPACT FOLIO" in Germany through various Apple stores. Your products are nearly identical to the product of our client and give the same overall impression. Hence, your products are a clear infringement of our client's unregistered Community Design. Our client therefore asserts claims for injunction, rendering of accounts and damages. Moreover, you are obliged to compensate our client for any legal costs so far accrued from our services.
With its request to sign a cease and desist declaration, our client hereby gives you the opportunity to avoid a legal dispute. In the name and on behalf of our client we hereby ask you to sign the enclosed cease and desist declaration we have already prepared or sign a cease and desist declaration that covers the claims cited above. We look forward to receiving the enclosed cease and desist declaration — duly signed — at the latest until 15 September 2014.
The receipt of the signed declaration via fax by this time will be deemed in due time if the original document is then received without further notice.
If you do not comply with the before-signed claims not fully or not in due course our client will reserve its rights to take legal action against you which would cause further costs."
The cease and desist declaration which accompanied the letter contained an undertaking by Tech21 to Logitech:
"1. upon pain of a contractual penalty of €5.100,00 … for each case of non-compliance — excluding the application of the continuation-of-offence clause — to refrain from manufacturing, offering, placing into circulation, importing or using, or possessing for the above purposes in the European Union protective cases as shown below…
2. to render accounts regarding the scope within it has committed the actions referred to under 1. above, specifying a) the quantity of products obtained or ordered as well as names and addresses of manufacturers, suppliers and other previous owners of the products; b) the individual deliveries, broken down according to the quantities delivered, the delivery times and prices and product names, and the names and addresses of the commercial customers; c) the individual offers, broken down according to the quantities offered, the offer dates and prices and product names, and the names and addresses of the recipients of the offer; d) the kind of the advertising performed, broken down according to the advertising media, their circulation figures, dissemination period and area of coverage; e) the turnover made with the products and the cost factors broken down to individual cost factors;
3. to pay damages for the actions referred to under 1 above;
4. to destroy all products described under 1 above which are directly or indirectly possessed or owned by Tech21 UK Ltd. at their own expense;
5. to recall all products described under 1 above or to remove these products from the distribution channels.
6. to reimburse Logitech Europe S.A. for the costs of our retainer to the amount of 1.5 fees on the basis of a value in dispute of €100,000,00 plus expenses (in total €2.274,50)."
On 12 September 2014, Tech21's solicitors, Charles Russell Speechlys, wrote to Jonas asking for an extension of time to 26 September. On 15 September, Jonas replied giving an extension to 17 September. The same day, 15 September, this claim was issued, and on 17 September Charles Russell Speechlys sent a copy to Jonas.
Two days later, on 19 September 2014, Logitech filed a motion in the Regional Court in Düsseldorf applying for a preliminary injunction, on the basis of infringement of a Community design, alternatively violation of competition law. The basis of the claim was essentially that set out in the Letter, although providing more detail.
Tech21 filed three affidavits in response; by Mr Cass, and by two other individuals who work for Tech21 — the head of design and a product designer. These said that the design of the Impact Folio cases was developed by Tech21, not by Logitech or Design Partners. A previous design had been worked on by Tech21 in conjunction with Logitech, and prototypes were prepared based on that previous design, but they would have been too expensive to produce commercially. Thereafter, Tech21 produced...
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