Oxford University Innovation Limited v Oxford Nanoimaging Limited

Costs consequences should reflect the substance of the parties’ success. A losing issue does not justify a percentage deduction where it did not materially increase the winning party’s costs and was not suitably circumscribed.

Indemnity costs require conduct outside the norm. Refusal of a non-Part 36 offer warrants indemnity costs only in an appropriately exceptional case, such as highly unreasonable refusal. Summary assessment is appropriate only where the court has sufficiently complete information to assess reasonableness and proportionality. Otherwise, an interim payment may provide a realistic advance while preserving detailed assessment.

This was a consequential judgment following the court’s Main Judgment of 23 December 2022 concerning disputes between Oxford University Innovation Limited, Oxford Nanoimaging Limited and Oxford University. The court determined outstanding royalty payments, costs, confidentiality and permission to appeal.

The principal costs issues were whether a deduction should be made for an issue on which the defendant succeeded, whether indemnity costs were justified, whether costs should be summarily assessed, the amount of any interim payment and interest. The court also considered proposed grounds of appeal concerning section 39 of the Patents Act 1977 and fairness under the UCTD.

1. Costs deduction. The general approach, following Hospira UK Ltd v Novartis AG [2013] EWHC 886 (Pat) and Unwired Planet International Ltd v Huawei Technologies Co Ltd [2016] EWHC 410 (Pat), asks who substantially won, whether the losing issue was suitably circumscribed, and whether the circumstances justify a further costs adjustment. The consumer issue was not suitably circumscribed. It did not materially increase either party’s costs and therefore justified no deduction.
2. Indemnity costs. The defendant’s refusal of the claimant’s non-Part 36 WPSATC offers did not justify indemnity costs. Such offers must not be treated as Part 36 offers: Coward v Phaestos [2014] EWCA Civ 1256. In the circumstances, refusal was not highly unreasonable. The approach in F & C Alternative Investments (Holdings) v Barthelemy [2012] EWCA Civ 843 and Astex Therapeutics v AstraZeneca [2018] EWCA Civ 2444 did not assist. Lejonvarn v Burgess & Anor [2020] EWCA Civ 114 concerned a materially different factual context.
3. Assessment and payment. Summary assessment was refused. Where substantial sums are in issue and the rules do not require summary assessment, the court needs sufficiently complete information about matters including hourly rates, time spent and staffing. An interim payment of £925,000 was ordered pending any detailed assessment.
4. Permission to appeal. Permission was refused. There was no real prospect of success and no other good reason for an appeal. Section 39 of the Patents Act 1977 required a fact-sensitive assessment of whether the invention might reasonably be expected to result from the employee’s duties. Salary did not determine that question, and the decision was confined to the particular facts. The UCTD fairness assessment involved multifactorial evaluation, including actual as well as potential impact, comparison with general law and separate consideration of good faith.
5. A confidentiality order was made in relation to specified commercially confidential material, with permission to apply to vary it. Payment of outstanding royalties was ordered, less sums already paid.

The judgment was consequential to the Main Judgment delivered by the same court on 23 December 2022. No citation for that judgment is stated in the judgment supplied.