CANON KABUSHIKI KAISHA v. GREEN CARTRIDGE CO (HONG KONG) LTD AND ANOTHER

IN THE COURT OF APPEAL

1995, No. 152
(Civil)

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D E C I S I O N

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Litton, V.-P. (giving the decision of the Court):

1. We now deal with the form of the Order which should be made consequent upon our judgment. There are three matters outstanding: (1) the costs in the court below; (2) the costs of the appeal and (3) an enquiry as to damages flowing from an undertaking made in an Order of Mr Justice Liu dated 30 August 1995.

2. Dealing with costs in the court below first. As counsel have outlined to us there were eight issues dealt with by Rogers J. comprising of the five patents in dispute, the question of copyright, that of the 2nd defendant's personal liability and of "innocence" relating to the patents.

3. In the result the defendants won on two issues: The question of copyright and the 2nd defendant's personal liability. As to the question of personal liability the 2nd defendant has in effect won altogether and there can therefore be no question of his being liable for any of the costs incurred by the other side. But why should the 1st defendant not be ordered to pay part of the plaintiff's costs in the court below?

4. It is clear that, at the trial, much time and effort was spent on three patents: Nos. 054, 454 and 693 on which the plaintiff won, and there has been no appeal. Any order for costs we make in this court must obviously reflect that fact. On the other hand considerable time was taken in the court below concerning the 2nd defendant's personal liability as to which the defendants won. So any order we make must also reflect that fact.

5. The judge ordered costs to the plaintiff by reference to the issues before him and he ordered that 73% of the plaintiff's costs should be paid by the defendants. That order must plainly be disturbed to reflect the result of the appeal. Giving anxious consideration to all the matters which we have entertained the proper order, in our judgment should be that the 1st defendant should pay 40% of the plaintiff's costs.

6. Turning then to the costs of the appeal, it is common-ground that the plaintiff must pay part of the defendants' costs. But the defendants did not win altogether in this court and there was also an application to admit fresh evidence made by the defendants which failed before us. So any order for costs which we make should reflect those matters. We have received useful submissions from counsel on both sides and exercising our best judgment we order that the plaintiff pays 55% of the costs of the appeal.

7. The third matter deals with paragraphs 6 and 7 of the draft order which as originally formulated read as follows:

"6. There be an enquiry as to the damage suffered by the 1st and/or 2nd Appellants (including interest payable upon such damage) by reason of the existence of the Judgment and the conditions attached to the stay of execution contained in the Order herein of the Honourable Mr. Justice Liu J.A. of 30th August 1995 and payment of all sums due on such enquiry;

7. The costs of the enquiry referred to under (6) above are to be reserved."

8. The undertaking embodied in the Order of 30 August 1995 was given in rather unusual circumstances. It related to an application made by the defendants to stay part of Rogers J's judgment. We have entertained interesting argument from counsel on the issue. What we need to decide is whether there is sufficient material before the court to enable us to exercise what parties agree is a discretion vested in us. We are not satisfied that there is sufficient material; therefore the proposal that there be an enquiry as to damages in the terms sought in the draft Order is not one we are prepared to entertain. Paragraphs 6 and 7 should therefore be deleted from the draft Order.

9. We now deal with the applications for leave to appeal to Her Majesty in Council. Both parties seek leave. The applications are taken out under Rule 2(b) of the Order-in-Council governing appeals to Her Majesty in Council. The plaintiff seeks leave to appeal on two matters: (1) The copyright or British Leyland point and (2) the question of the 2nd defendant's personal liability. As to that we have come to the view that the plaintiff should have leave to appeal on the question of law as formulated in the notice of motion concerning the copyright/British Leyland point. As to the question of the 2nd defendant's personal liability by a majority we refuse the application.

10. We turn now to the 1st defendant's application to appeal concerning the two patents Nos. 933 and 261 and more particularly the question of "obviousness" in section 3 of the Patents Act of 1977. In this regard we refuse the 1st defendant's application for leave.