Wednesday, November 27, 2013

Punitive damages for patent infringement in the UK?

As I note in my book (pp. 209-10), the Patents Court in Catnic Components Ltd. v. Hill & Smith, [1983] F.S.R. 512, 540, held that exemplary (punitive) damages are not available for patent infringement in the U.K. The court reasoned that, even though it believed the defendant's conduct fell within one of the categories that generally can justify an award of exemplary damages under Rookes v. Barnard,  [1964] A.C. 1129 (H.L.) (opinion of Lord Devlin) (specifically, cases "in which the defendant's conduct has been calculated by him to make a profit for himself which may well exceed the compensation payable to the plaintiff . . . Where a defendant with a cynical disregard for a plaintiff's right has calculated that the money to be made out of his wrongdoing will probably exceed the damages at risk"), Lord Devlin was speaking only of cases in which exemplary damages had been awarded, not recognizing a more general category of cases in which exemplary damages could be awarded.  In other words, the class of cases in which such damages may be awarded was limited to those in which exemplary damages had been awarded in the past, and that did not include patent infringement cases.  See Catnic, [1983] F.S.R. at 541 ("In my judgment, the claim to exemplary damages is not open to the plaintiffs in the absence of any authority that exemplary damages had been awarded for infringement of patent prior to the decision of the House of Lords in Rookes v. Barnard.").  

As pointed out in AIPPI United Kingdom Group, Report Q186:  Punitive Damages as a Contentious Issue of Intellectual Property Rights, available here the House of Lord subsequently rejected that interpretation of Rookes v. Barnard in Kuddus v. Chief Constable of Leicestershire Constabulary, [2001] U.K.H.L. 29.  Exemplary damages are not limited to cases in which they had been awarded prior to 1964.  At least in theory, then, punitive damages could be awarded in a patent case.  See also Nicolas van Zeebroek & Stuart J.H. Graham, Comparing Patent Litigation Across Europe:  A First Look (Sept. 8, 2011), at 24 (indicating that exemplary damages are available "sometimes" in the U.K.), available here.   Nevertheless, the authors of the AIPPI Report state that they are aware of no cases in which a court in the U.K. has awarded exemplary damages for patent infringement, and they do not favor such awards; among other things, they note the availability of awards of defendant's profits as an adequate alternative in a case in which those profits exceed the patentee's loss.  (The report is undated, but I believe it's from 2005.  I am not aware of any subsequent cases in the U.K. awarding exemplary damages for patent infringement.)  But at least in theory, it appears that punitive damages could be awarded under the applicable law, and perhaps someday we will see such a case.

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I'll be taking the rest of the week off for the Thanksgiving holiday.  Best wishes to my U.S. readers for the long holiday weekend.

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