Edwards Lifesciences AG v Cook Biotech Inc

In exercising its discretion as to costs, the court must consider all the circumstances, including party conduct, success on individual issues and proportionality. An issue-by-issue approach is useful where reasonably practicable, but it is not conclusive. The court must also assess whether it was reasonable to raise, pursue or contest particular issues and retains a wide discretion to further the overriding objective. Disclosure must be necessary and proportionate, especially in patent proceedings. Failure on some issues may justify a deduction from the successful party’s costs, while indemnity costs require circumstances taking the case outside the norm.

The claimant had succeeded in its claim for revocation of the defendant’s patent, and the defendant’s infringement counterclaim had failed. The court had therefore found the patent invalid and not infringed. This judgment concerned the consequential costs order.

The defendant accepted that the claimant should receive its costs but argued for a reduction because the claimant had failed on some issues and because the costs incurred were excessive. The claimant sought its costs, including indemnity costs in relation to an extensive disclosure exercise.

1. The claimant was the successful party and was entitled to its costs in principle. Under Civil Procedure Rules 1998, rule 44.3, the court had a discretion as to whether costs were payable, their amount and timing. The general rule was that the unsuccessful party pays the successful party’s costs, subject to all the circumstances.

2. Following SmithKline Beecham Plc v Apotex Europe Ltd. (No. 2) [2005] FSR 24, an issue-by-issue approach should be applied so far as reasonably practicable, but it was not conclusive. The court also had to consider the reasonableness of pursuing particular allegations, proportionality, party conduct and the overriding objective.

3. The defendant’s failure to narrow the independently valid claims earlier had unnecessarily increased costs. Its disclosure request had resulted in the production and review of more than 10,000 documents, none of which was used at trial. Disclosure in patent actions should be controlled robustly and should be both necessary and proportionate. Nevertheless, indemnity costs were not justified because the defendant had acted pursuant to a judicial direction and the claimant had agreed to provide the documents, albeit under protest.

4. The claimant had failed on some novelty and obviousness issues and had abandoned others. A deduction was therefore appropriate. Having considered the whole case, the court ordered that the claimant recover 80% of its assessed costs. An interim payment on account of costs of £650,000 was ordered.