Makeality Limited v City Doggo Limited & Anor

Allocation of an intellectual-property claim between the IPEC multi-track and small claims track depends on the ordinary case-management criteria, including value, remedy, complexity, evidence, parties and circumstances. Legal representation does not create an automatic entitlement to multi-track allocation, even though the small claims track generally restricts costs recovery. For claims commenced after 31 December 2023, arguments based on direct effect of Article 14 of the Enforcement Directive, or on conforming interpretation under the Marleasing principle, cannot be relied upon because the Retained EU Law (Revocation and Reform) Act 2023 removed EU supremacy and general principles from domestic law. Robust, fair first-instance case-management decisions attract appellate restraint.

Makeality claimed that City Doggo Limited and Laurencia Walker-Fooks had infringed its trade mark and committed passing off. The claim sought injunctions, delivery up, damages or an account of profits, and potentially additional damages. The claim was issued in the IPEC multi-track.

On 3 October 2024, HHJ Hacon transferred it to the IPEC small claims track, finding that its likely value was below £10,000 and that it could be tried within one day. Makeality appealed, arguing that the case-management factors favoured the multi-track and that Article 14 of the Enforcement Directive required a forum in which a successful party could recover a significant part of its reasonable legal costs. The central issues were the proper approach to allocation and the effect of the post-2023 domestic law governing retained EU law.

1. Disposition. Arnold LJ gave the leading judgment, with Dingemans and Holroyde LJJ agreeing. The appeal was dismissed.
2. Costs and Article 14. The claimant was permitted to raise its Article 14 argument on appeal because it was a pure point of law and caused no prejudice. The court considered the interpretation of Article 14 in United Video Properties Inc v Telenet NV [EU:C:2016:611], including the requirement that a significant and appropriate part of reasonable costs should be recoverable. It did not need finally to decide whether the IPEC small claims regime complied with Article 14. The decisive point was that the Retained EU Law (Revocation and Reform) Act 2023 removed EU supremacy and general principles from domestic law after 31 December 2023. A claim commenced in 2024 could therefore not rely on direct effect or on the conforming-interpretation principle in Marleasing SA v La Comercial Internacional de Alimentación SA [1990] ECR I-4135. The court also held that the Civil Procedure Rules could not be interpreted so that legal representation automatically prevented small-claims allocation. That would conflict with the legislative scheme, which deliberately provides a low-cost track with very limited costs shifting.
3. Appellate review. The court applied the established restraint applicable to robust and fair case-management decisions, as illustrated by Jalla v Shell International Trading and Shipping Co Ltd [2021] EWCA Civ 1559. An appellate court should not substitute its own view merely because another allocation would also have been possible.
4. Application of the allocation criteria. The judge was entitled to find that the claim was probably worth less than £10,000 because the claimant had produced no supporting sales or profit evidence. Unsupported assumptions about a reasonable royalty did not establish a higher value, particularly as the defendant’s turnover included other products. The judge was also entitled, given his experience, to conclude that the liability issues could be tried in one day. The pleaded section 10(1) claim, passing off, additional damages and joint tortfeasance did not materially alter that assessment. Legal representation and elaborate pleadings could have supported multi-track allocation, but they did not require it. The judge could also leave quantum to be determined separately if necessary.
5. Final conclusion. Given the likely value below £10,000 and the realistic one-day trial, allocation to the small claims track was consistent with the overriding objective and proportionate cost.

• Court of Appeal (Civil Division): dismissed the appeal concerning allocation to the IPEC small claims track, [2025] EWCA Civ 400.
• High Court of Justice, Intellectual Property Enterprise Court: on 3 October 2024, HHJ Hacon transferred the claim from the multi-track to the small claims track.