Kirin-Amgen Inc & Ors v Hoechst Marion Roussel Ltd. & Ors

In patent litigation, costs generally follow the event under Civil Procedure Rules 44.3(2). The court may nevertheless award costs to a party successful on a particular issue where justice requires. The overall result remains the primary guide: a defendant who obtains no relief against it because there is no infringement will ordinarily receive the general costs, even if it loses some validity issues. Costs orders should not encourage unsuccessful pleading. Where issue-by-issue assessment would be disproportionate, the court may make a broad percentage order, having regard to the overriding objective and the demands on court resources.

The proceedings concerned the validity and infringement of a patent. At first instance, Mr Justice Neuberger held that the patent was infringed and partially invalid, requiring amendment; other findings were not appealed. In its earlier judgment dated 31 July 2002, the Court of Appeal held that the patent had not been infringed, rejected attacks based on novelty and insufficiency, and reached a different legal conclusion on the validity of claims 19 and 20.

This judgment addressed the costs of the consolidated proceedings before the judge and on appeal, including amendment proceedings. The central issue was whether costs should follow the overall outcome or be allocated principally by individual issue.

Disposition. Lord Justice Aldous gave the judgment. Lady Justice Hale and Lord Justice Latham agreed. Kirin Amgen was ordered to pay 10 per cent of TKT’s costs in all the proceedings, including the amendment proceedings, both before the judge and in the Court of Appeal.

1. The ordinary principle is that costs follow the event under Civil Procedure Rules 44.3(2). In an appropriate case, the court may award costs to a party who succeeds on an issue where that course serves the interests of justice generally.
2. Patent defendants commonly contest both infringement and validity. An order should not encourage parties to plead unsuccessful issues, and should generally reflect the outcome of the proceedings. Since TKT achieved the result it sought, namely that no relief was granted because it had not infringed, it was appropriate in principle for TKT to receive the general costs, including the costs of the infringement issue.
3. The fact that novelty and insufficiency arguments were advanced as a squeeze did not affect the costs analysis where those arguments played no part in the conclusion that there was no infringement. They were an unnecessary addition to the case.
4. The costs consequences of the validity challenge to claims 19 and 20 could fairly be dealt with by making no order as to the costs of that issue, given the different conclusions reached on its sub-issues. The costs of the separate breadth-based insufficiency issue were recoverable by Kirin Amgen, together with the other insufficiency costs which TKT accepted.
5. A detailed assessment of the parties’ costs would itself generate substantial expense and consume court resources. Applying the overriding objective in Civil Procedure Rules 1.1(2)(b) and (e), the court adopted a broad percentage assessment and ordered payment of 10 per cent of TKT’s costs.

• Court of Appeal (Civil Division) — In its earlier judgment dated 31 July 2002, the court held that the patent was not infringed and rejected attacks based on novelty and insufficiency. In the present judgment it determined the costs of the proceedings.
• High Court of Justice, Chancery Division — Mr Justice Neuberger had held that the patent was infringed and partially invalid, requiring amendment. Other issues decided at first instance were not appealed.