Heeling Sports Ltd v Youngsters Ltd.

On an application for an interim patent injunction, damages are ordinarily an adequate remedy where the claimant’s recoverable loss can be calculated by reference to lost sales or profits and the defendant is able to satisfy any judgment. Goodwill and reputation are not separately compensable in a patent infringement claim, although they may inform the assessment of lost custom. Delay is not, by itself, a bar to injunctive relief. It becomes relevant where the claimant’s inactivity has caused the defendant materially to alter its position, making an injunction inconvenient or unjust.

The claimants sought an interim injunction restraining the defendants from selling shoes alleged to infringe a patent for footwear containing a wheel in the heel. The parties accepted that there were serious issues to be tried on both infringement and patent validity.

The court therefore considered the application under the Cyanamid principles, focusing first on whether damages would be an adequate remedy and, if necessary, where the balance of convenience lay. The court also considered whether delay affected the exercise of its discretion.

1. Interim injunction refused. The infringement and validity issues were serious issues to be tried, but the court was concerned only with interim relief.
2. Under the first stage of the Cyanamid approach, damages had to be assessed by reference to the loss recoverable at common law for patent infringement. That loss comprised lost profits or, where greater, the defendant’s profits attributable to the infringement. Goodwill and reputation were not themselves compensable, although they could be relevant to the amount of custom that would otherwise have been obtained.
3. The claimants’ likely loss before trial could be estimated from anticipated sales and profit per pair. The defendants’ accounts indicated that, despite trading losses, the group had sufficient net assets to satisfy a judgment. Damages were therefore an adequate remedy for the claimants and the injunction had to be refused.
4. Had the claimants’ remedy been inadequate, damages would also have been adequate for the defendants if an injunction were granted and later discharged. Their loss could similarly be assessed by reference to lost profits on the competing product. In that event, the court would probably have granted the injunction without needing to consider the balance of convenience.
5. Delay was not itself a bar to an injunction. It could become relevant where the claimant’s inactivity had led the defendant materially to alter its financial or other arrangements, so that requiring abandonment pending trial would be inconvenient or unjust. The evidence did not establish such a change here. The court directed further evidence on the defendants’ financial position and directions for a speedy trial.