Schutz (UK) Ltd v Werit UK

Case management must balance overlapping issues and the risk of inconsistent evidence against proportionality, equality of arms and the efficient use of representation. Where related patent, trade mark and passing-off claims overlap but need not be tried together, the court may direct sequential hearings. This may be particularly appropriate where one defendant cannot afford to participate fully in a combined trial, and where determination of the patent claim may resolve or substantially reduce the need for later claims. Protective undertakings may also reduce interim prejudice and support separate hearings.

Two related patent actions concerned intermediate bulk containers and the same patents. In one action Schutz (UK) Limited sued Werit UK for patent infringement. In the other, Schutz UK Limited and Schutz GmbH & Co. KGaA sued Delta Containers Limited for patent infringement, trade mark infringement and passing off.

The court was required to decide how the claims should be managed. Schutz sought a single trial of all claims. Werit and Delta sought a stay of the trade mark and passing-off claims pending determination of the patent action. Delta, a small family company, sought to amend its pleadings and offered an undertaking to remove or obliterate Schutz trade marks from relevant cages and pallets.

1. The claims should not be stayed and should not all be tried together. They were directed to be heard sequentially: the patent claims first, anticipated in February 2010, followed, if necessary, by the trade mark and passing-off claims after 1 October 2010.
2. Although there was overlap concerning the industry, technology, bottle-and-cage compatibility, exhaustion and market position, the overlap did not require a single trial. Any risk of inconsistent evidence or argument could be reduced by making the transcript and judgment from the patent trial available for the later hearing.
3. The court gave substantial weight to Delta’s limited financial resources. Requiring Delta’s representatives to attend the whole of a combined trial would be wasteful and might effectively prevent Delta from participating. That would be unjust and inconsistent with proportionate case management.
4. The patent proceedings might, in practical terms, dispose of the trade mark and passing-off claims, particularly if Schutz succeeded on the relevant patents. The expiry of one patent and the possibility of other manufacturers’ bottles meant that the patent proceedings might not be wholly dispositive, but this did not outweigh the case-management considerations favouring sequential hearings.
5. Delta’s undertaking to remove or obliterate Schutz marks provided substantial interim protection against further alleged trade mark and passing-off losses pending trial.