Easygroup Limited v Easy Live (Services) Limited & Ors.

In determining costs, the court must identify the winner by applying sensible practical and commercial reality to the substance of the litigation. A party may fail to qualify as the overall winner where its success is small compared with the claim and issues raised. The court may also consider whether reasonable settlement proposals were properly engaged with. That conduct must be balanced against the successful party’s material findings, including deliberate infringement. The appropriate order therefore depends on the overall significance of the parties’ successes and failures, rather than on isolated points.

The judgment determined costs following trade mark and passing off proceedings. The claimant succeeded under section 10(3) of the Trade Marks Act 1994 in respect of three signs, but failed under section 10(2) and on passing off. The defendants substantially succeeded in revoking parts of the claimant’s trade mark specifications and remained entitled to use their registered mark, company name and domain name.

The court also considered without-prejudice correspondence in which the defendants proposed changes to their branding. The central issues were which party should be regarded as the winner and what effect the parties’ settlement conduct should have on the costs order.

1. The defendants were treated as the more realistic winners, although both parties could claim success in different respects. The claimant had established significant infringement, but had not achieved its apparent wider objective of closing down the defendants’ business or bringing it within the claimant’s commercial fold.

2. In identifying the winner, the court applied the approach in Omnipharm Ltd v Merial 2012] EWHC 172 (Pat), Roache v News Group Newspapers [1998] EMLR 161 and HLB Kidsons v Lloyds Underwriters [2007] EWHC 2699. The assessment required attention to substance, reality, the value of what the claimant had obtained, and the extent to which the defendants had denied the claimant its real prize.

3. The defendants’ settlement proposals did not clearly offer relief equivalent to the result ultimately obtained and did not acknowledge past infringement. Nevertheless, they were sufficiently directed towards avoiding the relevant trade mark dispute. The claimant’s failure to engage with them, while pursuing a wider commercial objective, was relevant to costs.

4. The court declined to order the claimant to pay all the costs that might have been avoided. The defendants had committed a deliberate wrong, had not made completely plain that it would not be repeated, and had lost on substantial issues. Balancing those matters, the claimant was ordered to pay 35% of the defendants’ costs. Any payment on account was to be determined separately if not agreed.