Tangle Inc v One For Fun Limited & Ors

Personal liability of a company director for joint tortfeasance requires more than directorship, control through constitutional organs, or knowledge of an alleged infringement. The pleaded case must disclose conduct amounting to participation in the tort, pursuant to a common design, with an intention that the tortious act occur. At the strike-out stage, the court assesses whether the allegations are legally sustainable and have a real prospect of success. It does not resolve disputed evidence. Allegations of awareness of complaints and pre-action correspondence are insufficient without pleaded involvement in the infringing acts. A claim may survive where the pleadings and limited evidence just cross that threshold.

The claimant, owner of copyright in the Tangle toy, alleged infringement by a Scottish wholesaler and retailer intending to sell a competing Jumbly toy. It also alleged that three directors were jointly liable as tortfeasors because they had authorised, procured, facilitated or assisted the company’s infringement.

The defendants applied to strike out the claims against the directors. The court considered whether the allegations and limited evidence disclosed legally sustainable claims with a real prospect of success, and whether the claims should instead be stayed to any damages enquiry.

1. Applicable principles. Joint tortfeasance requires assistance in the commission of a tort, pursuant to a common design, to do an act which is or becomes tortious. Under the principles reviewed in Lifestyle Equities CV v Ahmed, a director is not liable merely because of office, control or the performance of constitutional functions. The individual must be personally involved in the tort to an extent sufficient to create accessory liability.
2. Insufficient allegations. Previous sales of the claimant’s products, the market reputation of those products, their resemblance to the Jumbly product, being on notice of objections, and awareness of pre-action correspondence did not themselves amount to infringing acts or sufficient involvement. The Second Defendant’s email responding to the infringement complaint was treated as an answer on behalf of the company. It did not establish his personal involvement in designing the product and did not implicate the Third or Fourth Defendants.
3. Third and Fourth Defendants. The claimant relied only on allegations that these defendants were directors and knew of the correspondence. There was no pleaded cooperation in the alleged infringements or intention that cooperation should bring them about. Their claims had no real prospect of success and were struck out. The defect was not one which repleading was likely to cure.
4. Second Defendant. The pleading that he controlled and operated the company, together with allegations of authorisation, procurement and assistance and limited supporting evidence, just crossed the threshold. The court could not say that the claim had no real prospect of success. Applying the approach in Au Vodka Limited v NE10 Vodka Limited & Anor, the court did not weigh competing evidence at this stage. The strike-out application therefore failed against him, but by consent the claim was stayed to any quantum hearing.