MGA ENTERTAINMENT INC. v. DOUBLE GRAND CORPORATION LTD

CACV 140/2006

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF APPEAL

CIVIL APPEAL NO. 140 OF 2006

(ON APPEAL FROM HCA 1883 OF 2003)

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D E C I S I O N

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1. Deputy High Court Judge Muttrie granted summary judgment to the plaintiff.  The defendant has filed a notice of appeal against the decision.  The plaintiff now applies for security for costs of the appeal to be furnished by the defendant. 

2. The defendant is a limited company with a total paid-up share capital of $10,000.  In the court below the defendant had by affirmation admitted that it had limited financial resources and was not able to engage lawyer to represent it.  It asked for permission of the court to dispense with the representation by a solicitor which was required in the case of a limited company.  The defendant has not filed any updated evidence on its current financial position. 

3. In my view the evidence is sufficient for the court to form the view that the defendant is in financial difficulties and would be unable to pay for the costs of the appeal if it is unsuccessful in the appeal. 

4. In exercising the discretion in considering whether security for costs should be imposed, the court is, of course, also required to consider the merits of the appeal so that if it shows there is a strong prospect of success, the court should not impose security so as to stifle a genuine pursuit by the appellant to redress a wrong. 

5. The plaintiff’s claim is one of copyright infringement by the defendant.  I have looked at the objects of infringement together with the genuine articles.  The similarity is striking.  Without expressing a final view on the matter, I do not regard the chance of success of the defendant on appeal is so high so that I should not order security to be given.

6. In my view security ought to be given.  As to the amount of the security, although the summons of the plaintiff asked for $290,000, Mr. Shipp, counsel for the plaintiff, only asked for $200,000.  This is an appropriate amount.  I will order this amount to be paid into court within 42 days.  The appeal is stayed pending payment.  In default of payment the appeal is dismissed with costs to the plaintiff.  The costs of this application is to be in the cause of the appeal.