Nintendo Co Ltd v. The World Camera and Radio Co Ltd and others

CACV 284/1998

-----------------------

H E A D N O T E

-----------------------

Interlocutory proceedings, the outcome of which would achieve no benefit to the parties nor decide any issue between the parties (satellite litigation), and which are based on a point which is plainly wrong are liable to incur an award of costs on an indemnity basis.

CACV 284/1998

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF APPEAL

CIVIL APPEAL NO. 284 OF 1998

(On appeal from HCA13078 of 1997)

----------------------

----------------------

J U D G M E N T

----------------------

Rogers, J.A. :

1. This is a plain and obvious case. In most circumstances, it would be unnecessary, in my view, to give reasons for the judgment beyond about two sentences but there may be costs implications.

2. In 1989, the Plaintiff introduced a hand-held game product called Game Boy and later other video game products. Amongst the popular games that could be played on that, according to the Statement of Claim were, Dr. Mario and Super Mario Land. To pretend that this Court has not heard of these could be likened to the Court which asked who the Beatles were.

3. The Plaintiff, by its writ, claims infringement of copyright in both artistic works and in literary works namely the computer programmes, in trademark, in registered design and in passing off.

4. The Plaintiff's complaint is that the Defendants have been selling cartridges that have copied its games in a package called "57 in 1". Whether there is any allusion to this configuration providing a variety has not been explored as yet in the course of these proceedings.

5. The Plaintiff complains of infringement of all the rights to which I have already referred and specifically, it complains of the use by the Defendants of the words "Super Mario 4" in connection with their product.

6. The writ in this case was issued 2nd December 1997 and that contained the following.

"The Plaintiff's claim is for :-

.....

2. An injunction to restrain the Defendants whether acting by themselves, their proprietors or partners, directors, employees, servants or agents or any of them or otherwise howsoever from passing off, attempting to pass off, causing, enabling or assisting others to pass off video games not the goods of or associated with the Plaintiff as and for the goods of or associated with the Plaintiff by the use in connection therewith the names and marks 'Nintendo', 'Dr. Mario', 'Super Mario Land' and/or 'Alley Way' or such colourable imitation thereof as to be likely to deceive or cause confusion, or by any other means whatsoever."

7. The draft Statement of Claim was sent by the Plaintiff's solicitors to the Defendants' solicitors on 14th April 1998 and was eventually filed out of time by consent on 21st April.

8. The Defendants took objection to a number of matters. The other matters have not been aired in this Court, but the Defendants succeeded in persuading the Judge below that an allegation that the Defendants had passed off their products as the Plaintiff's products by the use of the expression "Super Mario 4" was an impermissible allegation as it fell foul of Order 18 rule 15(2). That reads :-

"(2) A statement of claim must not contain any allegation or claim in respect of a cause of action unless that cause of action is mentioned in the writ or arises from facts which are the same as, or include or form part of, facts giving rise to a cause of action so mentioned; but subject to that, a plaintiff may in his statement of claim alter, modify or extend any claim made by him in the endorsement of the writ without amending the endorsement."

9. I can only admire the advocacy that achieved such a bizarre result.

10. The writ claims relief in passing off by the use of Super Mario Land and Dr. Mario or any colourable imitation thereof. The Statement of Claim claims reputation in the words "Dr. Mario" and "Super Mario Land". The Statement of Claim goes on to allege passing off by the use of the words "Super Mario 4". There thus remains to be determined whether Super Mario 4 is a colourable imitation of Super Mario Land or Dr. Mario. That is clearly the Plaintiff's contention. I doubt that determination of that point is likely to take more than a few seconds. The Defendants' objection is unarguable.

11. The whole exercise of raising this objection to the pleading was, in any event, a pointless exercise from a legal point of view. Even if by any stretch of the imagination, it were a correct legal argument, a simple amendment, which could not have been refused, would have sufficed.

12. The only likely result of taking this objection, it seems to me, was that the Defendants would slow the proceedings down for nearly a year. In my view, this Court should bear this in mind when it comes to a question of costs.

13. I would allow the appeal accordingly.

Godfrey, J.A. :

14. I agree and would only add this.

15. In a proper case, an indorsement of the nature of the claim on the writ is sufficient without amendment to the writ to justify a claim pleaded in a later statement of claim; see Graff Brothers Estates Ltd v. Rimrose Brook Joint Sewerage Board [1953] 2 Q.B. 318. This is just such a case.

Mortimer V-P:

16. For the reasons given I also agree that this appeal should be allowed.

17. The point taken by the defendants - which has led to this appeal - is technical, time wasting and plainly wrong. It is an interlocutory appeal and it is satellite litigation - that is litigation which is not intended to decide the issue between the parties. It is in retrospect a wholly regrettable piece of litigation. I say no more.

[Argument as to costs]

Rogers, J.A. :

18. We have heard argument as to the basis upon which costs, both in this Court and in the Court below, should be taxed as a result of this appeal. It is clear from our judgments that we consider that the point which has been raised was without merit and should never have been raised.

19. The unfortunate consequence of it having been raised and having been taken as far as this Court is that the litigation has been slowed down quite unnecessarily and that costs have been run up.

20. The basis of taxation of costs is one which is at large. That does not mean that this Court has an unfettered discretion. Nevertheless, the Court must look at the nature of the proceedings which have been brought before it.

21. In this case, as I indicated in my judgment, even if the argument had been, for some reason, correct, it would have availed the parties nothing had it succeeded. In the outcome, it has been held by this Court to be unarguable.

22. In my view, the Plaintiff should be entitled to all its costs except those which had been unreasonably incurred. That would therefore indicate the order for costs should be on an indemnity basis (Order 62 r.28(4A)). The Order, in my view, should be in respect of the costs both here and below. It is unusual to allow costs on an indemnity basis, not only in respect of this Court but also in relation to the proceedings below, on an appeal where the unsuccessful Respondent in fact succeeded in the Court below but recognising the nature of the argument which was put, that must follow, in my view.

Mortimer, V-P :

23. The order is that the appeal be dismissed with costs on an indemnity basis here and below.