Getty Images (US), Inc & Ors v Stability AI Ltd

Costs are governed by the overriding requirement to achieve justice between the parties. An issue-based approach is a useful structure in intellectual property litigation, but it is not a straitjacket. The court must identify the overall winner, determine whether any suitably circumscribed issue justifies a different costs order, and stand back to assess the result.

An issue may be taken at any suitable level of granularity, but substantial overlap may prevent it being treated as distinct. The overall winner is ordinarily entitled to costs that cannot be allocated to a particular issue. Where the winning party succeeds only partly on a discrete claim, a proportionate reduction may be made. The assessment may necessarily be rough-and-ready, provided it reflects the overall justice of the case.

This was a costs determination following the liability judgment in the claimants’ intellectual property proceedings against the defendant. The claimants had abandoned the Training and Development Claim, the Outputs Claim and the Database Rights Infringement Claim. They succeeded in part on the Trade Mark Infringement Claim, while the defendant succeeded on the key construction issue in the Secondary Infringement of Copyright Claim. The Passing Off Claim was not determined.

The central questions were which party was the overall winner, whether the Trade Mark Infringement Claim was a suitably circumscribed issue justifying a different order, and how the parties’ respective successes should be reflected in the costs order.

1. Overall winner. The defendant was the overall winner. The claimants had abandoned three substantial claims and lost the secondary copyright infringement claim. Their partial success on trade mark infringement, including an undertaking concerning Models v1.x and v2.x and an inquiry as to damages, did not outweigh the relief they failed to obtain. The amount potentially recoverable at the damages inquiry was irrelevant to identifying the winner at the liability trial.
2. Applicable approach. CPR Part 44.2 confers a wide discretion. The issue-based approach commonly used in intellectual property cases is a convenient analytical structure, not the only permissible approach. The court applied the three questions identified in Hospira v Novartis: who won, whether the winning party lost on a suitably circumscribed issue, and whether it was appropriate in all the circumstances to make a different costs order.
3. General and overlapping costs. An issue may be considered at any suitable level of granularity, but substantial overlap may prevent it from being suitably circumscribed. The defendant was therefore entitled to the costs of failed and abandoned claims and to costs that could not be specifically allocated. The court rejected an apportionment of general costs because this was not a score-draw case of the kind considered in Vringo.
4. Trade mark claim. The Trade Mark Infringement Claim was sufficiently distinct to justify a separate costs order. Viewed alone, the claimants were the successful party on that claim, but had failed on significant issues. The court awarded them 75% of the attributable costs, applying a 25% reduction. It assessed 17.5% of the overall costs as attributable to that claim, producing a 30.6% reduction in the defendant’s overall costs.
5. Interim payments. The defendant was awarded 70% of incurred costs, including out-of-budget interim applications, and 90% of budgeted costs. A cautious approach was appropriate for overspend because the court could not finally determine whether there was good reason to depart from the budget. It awarded 20% of the claimed overspend on account.

This was a first-instance costs determination following the liability judgment in the same proceedings, reported at [2025] EWHC 2863 (Ch).