PANDORA A/S AND ANOTHER v. PANDORA CO LTD AND OTHERS

HCA 2405, 2406, 2408,
2411, 2412, 2413, 2414/2015

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

ACTION NOS 2405, 2406, 2408,

2411, 2412, 2413 AND 2414 OF 2015

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J U D G M E N T

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1.  Although these seven actions have not been consolidated, they have been listed for hearing together as they raise the same issues, and I give this single judgment covering them all.

2.  The plaintiffs in each action are Pandora A/S, a company incorporated in Denmark where its registered office is, and its wholly owned subsidiary, Pandora Jewelry Asia-Pacific Ltd, a company incorporated in Hong Kong.  They are applying for judgment against each of the defendants under Ord 19 r 7 of the Rules of the High Court for each of the defendants’ failure to file a defence.  The cause of action in each case is passing‑off.  The plaintiffs’ case in short is that they and other companies in the Pandora group have been designing, manufacturing, selling and distributing items of jewellery both in Hong Kong and around the world.  Their brand name “Pandora” has acquired a substantial reputation, and Pandora A/S is the proprietor of a number of registered trademarks in the name “Pandora”.  Each of the defendants has been incorporated in Hong Kong with names very similar to those of the plaintiffs.  The shareholders and directors of each of them are people with addresses in Mainland China.  There is no allegation that any of the defendants are active in Hong Kong, but the plaintiffs’ concern is that the people behind the defendants will use the documents relating to the defendants’ incorporation in Hong Kong to pass off items of jewellery in Mainland China as if they were those of the plaintiffs.

3.  The creation of shadow companies of this kind was considered by Zervos J in Power Dekor (Hong Kong) Ltd v Power Dekor Group Co Ltd (HCA 1139/2013). He did not doubt that the use of the documents relating to the incorporation of such shadow companies in Hong Kong to pass off goods in Mainland China as if they were those of companies in the same position as the plaintiffs amounted to the tort of passing‑off.  Nor do I.  I am satisfied that each of the defendants has been duly served with the writ with the statement of claim endorsed on it that each of them has failed to serve a defence (indeed, none of them has filed an acknowledgement of service), and that each of them has been duly served with the summons seeking judgment in default of defence and has been notified of today’s hearing.  In the circumstances, I enter judgment for the plaintiffs against each of the defendants, and I make the orders sought in paras 1 – 8 of each of the summonses.

4.  I have been asked to assess the plaintiffs’ costs summarily.  I am prepared to do that.  I assess the manual work in section B of the plaintiffs’ statements of costs in the sum claimed of $1,892.  But there will inevitably have been a great deal of duplication in respect of the work in sections C and D of the statements.  For example, once one set of documents had been prepared, which I accept may well have taken six hours, it would not have taken anything like that to prepare similar documents for the other six defendants.  All that needed to be done was to change some of the details.  The same applies to much of the other work which the plaintiffs’ solicitors had to do.  It is not possible for me to say precisely how much work was done for each case, but even taking into account the time spent on carrying out company searches on each of the defendants, I believe that if I were to assess the plaintiffs’ costs at one-third of the stated cost of the work in sections C and D of the statements, I would be close to the mark.

5.  Accordingly, I summarily assess the plaintiffs’ costs in each of the cases at $8,884 — in other words, $1,892 for the work set out in section B of the statements, $1,500 for the work set out in section C of the statements and $5,492 for the work set out in section D of the statements — and I order each defendant to pay that sum to the plaintiffs.