Case Law Explores Cost Assessments in IP Litigation: Saint-Gobain Adfors SAS v 3M Innovative Properties Company

Citation: [2023] EWHC 2949 (Pat)
Judgment on

Introduction

The case of Saint-Gobain Adfors SAS v 3M Innovative Properties Company presents an insightful examination of cost assessments in intellectual property litigation. Deputy Judge Michael Tappin KC presided over this matter, addressing the cost implications following applications that had been addressed in a previous judgment. By dissecting the parties’ submissions and applying established legal frameworks concerning the reasonableness and proportionality of costs, the Deputy Judge provided a conclusive judgment on the contentious financial elements related to the legal proceedings.

Key Facts

The substantive elements of the case involved cost orders following the dispute over the use of CT Scan Files; however, this analysis focuses exclusively on how the cost assessment was conducted. The claimant, Saint-Gobain Adfors SAS (SG), submitted a statement of costs exceeding £104,000, while the defendant, 3M Innovative Properties Company (3M), contended that the recoverable costs should be capped at approximately £68,500. The dispute centered heavily on the hourly rates claimed, the appropriateness of certain costs items, and whether the sum total of the claimed costs was proportionate to the matters in issue.

Several legal principles are at play in the judgment, notably:

  1. Standard Basis of Costs: As per CPR 44.3(1)&(2), costs should not exceed what is reasonable in amount and must be proportionate to the significance of the dispute. Unreasonable or disproportionate costs are to be resolved in favor of the paying party.

  2. Proportionality: CPR 44.3(5) outlines that costs are considered proportionate if they bear a reasonable relationship to the sums involved, the value of non-monetary relief, the complexity of litigation, and other enumerated factors.

  3. Hourly Rates: The Guide to the Summary Assessment of Costs, particularly paragraphs 27-29 and Appendix 2, is referenced for benchmarking solicitors’ hourly rates, with the acknowledgment that in complex litigation, higher rates may be justified.

  4. Precedents: Judgments such as Samsung Electronics Co Ltd v LG Display Co Ltd and Lappet Manufacturing Co Ltd v Rassam are both referenced, emphasizing how a clear justification is required for exceeding guideline rates and how specialized legal work may warrant an uplift in costs, respectively.

Outcomes

The Deputy Judge carefully scrutinized each element of the costs claim, taking into account the complexity of the case, the expertise required, and the efforts reasonably necessary to pursue the litigation effectively. The final assessment of hourly rates resulted in allowances somewhat higher than the guidelines but did not meet the full rates claimed by SG’s solicitors. Similarly, the scrutiny led to disallowing certain costs related to evidence repetition, excessive preparation time, attendance at EPO hearings not directly attributable to the matter, and inflated travel expenses.

After judiciously weighing these factors, Deputy Judge Tappin KC concluded that SG’s recoverable costs amounted to £75,000 – a figure found to be potentially reasonable given the importance and potential value of the relief obtained by SG, despite the inherent difficulty of precisely determining this value.

Conclusion

In sum, the Saint-Gobain Adfors SAS v 3M Innovative Properties Company ruling meticulously applies the principles of cost reasonableness and proportionality. This case provides guidance on assessing the justification for costs in IP litigation, bearing in mind the complexity of the legal and technical matters and the expertise demanded. It is indicative of the judiciary’s efforts to balance equitable cost recovery with preventing excessive legal expenditures, ensuring the justice system remains accessible and fair. Legal professionals can draw from this analysis in formulating cost budgets and articulating arguments for the recovery of litigation expenses in future cases.

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