What is the cost of resisting orders in the IPEC?
In a blog post last year, we reported on the IPEC judgment in Wirex v Cryptocarbon Global concerning infringement of the trade mark CRYPTOBACK.
Following that decision, Wirex elected for an inquiry as to damages.
The defendants failed to respond promptly to that action, then abused the court process by resisting the joinder of a fifth defendant and did not pay costs ordered by the court. They also launched unsuccessful applications to appeal the Court’s orders, and maintained that there were live proceedings at the UK IPO concerning the mark (which was not correct).
The case has now been resolved with a further judgment in the IPEC.
Damages and costs
The judge, HHJ Hacon, found that Wirex was entitled to have its claim for damages assessed on its unchallenged assertions, as the defendants were in breach of the Court’s order.
He said that the figures claimed by Wirex were “surprisingly high” but he had no basis to challenge them. They comprised an upfront fee of £50,000 a year (£200,000 in total) plus £2 per retailer or UK account holder (a total of £36,766).
However, he rejected a claim for £20,000 for “moral prejudice” saying: “I do not accept that severe frustration, which many litigants could routinely claim to have experienced, constitutes moral prejudice.”
Wirex was also entitled to £21,900 in capped costs of the inquiry, and £825 in court fees, plus a further £3,000 for the costs of an adjourned case management conference.
It was entitled to a 25% uplift on its costs (£5,475), as it had made a Part 36 offer in August 2021 to settle the damages claim by the defendants’ payment of £120,000 – and the award made by the court exceeded that sum.
The defendants argued that they could still accept Wirex’s Part 36 offer. But the judge said that a Part 36 offer can only be accepted once a trial is in progress with the court’s permission: “Permission was not sought but I would have had no hesitation in refusing permission.”
Taking account of all the circumstances, the judge said the defendant had wilfully breached the court’s order, and the breach was serious and significant such that he was not entitled to relief from sanctions.
Stepping back from the detail of the various orders and amounts awarded, this case is a warning about resisting the orders of a court. Due to delays and non-compliance, the defendants now face paying significantly more in damages and costs than was available in the claimant’s Part 36 offer.
The defendants were unrepresented by either solicitors or barristers in this part of the litigation. With the benefit of proper legal advice, they might have behaved differently.