Price & Ors v Flitcraft Ltd & Ors

On an application for summary judgment, the court must assess whether the respondent has a realistic rather than fanciful prospect of success. It must consider both the material before it and evidence reasonably expected at trial. Summary determination is inappropriate where fuller factual investigation may affect the outcome.

On an appeal from an interim order, fresh evidence may be admitted where it was not readily available, reasonable diligence was exercised in the circumstances, and the evidence raises a triable issue. Compliance with the notice and evidential safeguards governing summary judgment is critical to a fair hearing.

The respondents brought proceedings for patent infringement, copyright infringement and passing off. The defendants asserted competing chains of title to the patents and copyright. The High Court, Intellectual Property List, granted the claimants summary judgment on the patent and copyright claims in [2019] EWHC 1965 (Pat), while permitting the passing-off claim to proceed.

The defendants appealed and sought to introduce evidence from an insolvency practitioner who had acted in the relevant personal and corporate insolvencies. That evidence supported substantially amended defences based on an alleged assignment to a third party, beneficial ownership by a partnership, and subsequent transfers of the intellectual property. The central questions were whether the evidence should be admitted and whether the defendants had realistic prospects of defending the patent and copyright claims.

1. The appeal was allowed unanimously. The further evidence was admitted, permission was granted for the proposed re-re-amendments to the defence, and the summary judgments on patent and copyright infringement were set aside.

2. On an appeal from an interim order, the criteria associated with Ladd v Marshall remain highly relevant but must be adapted to the nature of summary proceedings and applied consistently with the overriding objective. The evidence must not have been readily available or easily made available at the interim hearing. The diligence required is what was reasonable in the circumstances, and may be less exacting than after a trial. Taken with the existing material, the evidence must raise a triable issue. The insolvency practitioner's evidence satisfied those requirements: paras 44–46, 61–63.

3. The evidence supported a triable defence to patent ownership. The apparent assignment to Lightpeak pre-dated the alleged assignment to Mr Bridge, and contemporaneous material raised genuine questions about the existence, date and effectiveness of the latter transaction. Registration was prima facie evidence of an assignment under section 32(9) of the Patents Act 1977, but it did not prevent investigation at trial. The alternative trust-based chain of title was less promising, yet narrowly crossed the threshold because the facts remained uninvestigated: paras 71–76.

4. The evidence also raised a triable copyright issue. Depending on the circumstances, a person paying for the creation of a copyright work may acquire equitable ownership rather than merely a licence. Whether the partnership acquired such ownership, and whether it passed through the alleged assignments, required trial: para 77.

5. Independently, the defendants had not admitted either subsistence of copyright or the alleged chain of title to the first respondent. Their pleading had to be read as a whole. The assertion that they correctly believed themselves to own the rights was an alternative case proceeding on the assumption that the claimants could first establish subsistence and title: paras 81–83.

6. The safeguards in Part 24 of the Civil Procedure Rules 1998 and its practice direction are mandatory protections securing a fair and expeditious hearing. The application had failed to identify the proposed issues and evidence properly. In those circumstances it was unfair to treat the defendants' absence of documents and contextual evidence as a reason for granting judgment: paras 85–87.

1. Court of Appeal (Civil Division): In [2020] EWCA Civ 850, the court unanimously admitted the further evidence, permitted the proposed re-re-amendments and allowed the defendants' appeal.

2. High Court, Intellectual Property List (Patents Court): In [2019] EWHC 1965 (Pat), Mr Recorder Douglas Campbell QC granted the claimants summary judgment on the patent and copyright infringement claims, while allowing the passing-off claim to proceed to trial.