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	England and Wales High Court (Patents Court) Decisions
You are here: BAILII >> Databases >> England and Wales High Court (Patents Court) Decisions >> Buhler AG v FP Spomax Sa [2008] EWHC 1109 (Pat) (28 April 2008) URL: http://www.bailii.org/ew/cases/EWHC/Patents/2008/1109.html Cite as: [2008] EWHC 1109 (Pat)

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IN THE HIGH COURT OF JUSTICE
CHANCERY DIVISION
PATENTS COURT

		Royal Courts of Justice Strand London WC2A 2LL
		28th April 2008

Mr Justice Mann :

1. The first point I have to deal with on the occasion of the hearing of the consequential matters arising out of my judgment handed down on 21st April 2008 is the question of the amount of an interim payment on account of costs.
2. The Claimant accepts that the Defendant should have its costs of the action and it accepts in principle that the Defendant is entitled to a payment on account. The parties, however, differ very significantly in the amount of the interim payment that they say should be payable.
3. The Defendant's costs of this action are £1,034,234. The Defendant says that it should have an interim payment of roughly 55% of that sum, in accordance with the principles laid down in Mars UK Ltd v Teknowledge Ltd (2000) FSR 138. The actual sum sought is £550,000.
4. The Claimant says that the sum should be very much less, for two reasons. First, it seeks to exclude entirely a sum of (in round terms) £360,000 from the overall bill because it is said that that is highly questionable in terms of recovery on a detailed assessment. Second, it applies some calculations to the chargeable rates of the solicitors involved and the amount of hours that should have been charged, and comes down to an interim payment which it says should be £240,000.
5. There are thus two principal points in issue for the purposes of today, the first the exclusion of the £360,000 and, secondly, when one has decided how much of that comes in, what further discounts there should be allowed for the uncertainties of the detailed assessment. I remind myself in carrying out this exercise that what I have to decide is a fair sum and I have to bear in mind that I should award only such sum as is safe, that is to say a sum which I am confident is a sum which the Defendant will recover on a detailed taxation in any event.
6. The first major point on what I have described as the £360,000 arises in this way. The Defendant is a Polish company. It is, at least compared to the Claimant (I am told) a relatively small company. It is not used to patent litigation and it has not conducted much historically speaking. Its board and its controllers are all Polish and Polish speaking, apart from Mr Lesniak, who is a senior board member, but who cannot devote the entirety of his time to this exercise, for entirely understandable reasons. The board does not speak English, at least not sufficiently well to be able to understand and run this action.
7. In those circumstances, for a considerable period of the running of this action until financial constraints intervened to make it difficult for them to do so, the Defendant engaged not only Simmons & Simmons as their English solicitors in this action but a firm of Polish lawyers called Patpol. Patpol were engaged as interpreters not only of the documents in a literal sense but also in terms of the advice being given, both a literal interpretation of the advice and, as I understand it, a translation of that into giving further advice in terms that a Polish company would understand. As I have said, Spomax could not sustain that extra expenditure for the entirety of the action so that, from a period some time before trial, Patpol was dispensed with and Mr Lesniak stepped in and did what was necessary. However, by that time, the brunt of the activities which it was useful that Patpol should participate in had been carried out. Patpol's bill for these services is the £360,000 to which I have referred. That must represent a considerable number of hours because Patpol's partner charging rate for these proceedings is £182 per hour.
8. Mr Hacon, who appears again for Bühler does not go so far as to say that none of that £360,000 as a matter of principle can be recovered. However, he says there is a serious question mark over it. Why, he says, should there be a separate set of lawyers providing effectively parallel advice? They were acting in substance merely as extremely expensive interpreters. In those circumstances, he says I should disregard for the purpose of the assessment of the interim payment the entirety of the £360,000. He points out that Mr Lesniak, who does speak fluent English, was able to fulfil the functions of interpreter in the later stages and there is no reason why he could not have done that in the earlier stages.
9. Mr Lykiardopoulos, who appears again for Spomax, says that as a matter of principle, foreign legal costs are recoverable and, on the facts of this case, there is no reason why these should not be recoverable. Furthermore, it should be sufficiently clear to me at this stage that at least some of the Patpol costs will be recoverable.
10. I have indicated the extent to which I must only award that which is safe. This is not the occasion, and no Counsel suggested it was, on which I should determine the broader question of principle as to whether any of the Patpol costs should be recoverable. It certainly seems to me that there is a serious question mark over whether the activities of Patpol as additional lawyers should be recoverable in this case. This was English patent litigation, involving a patent which had to be litigated in the English courts. In those circumstances, the prime lawyers are obviously going to have to be English. It is not clear to me why the intervention of Polish lawyers as lawyers giving legal advice is inevitably going to be necessary or appropriate. It may be that it is both necessary and appropriate, but I cannot at the moment see that it is sufficiently safe for me to assume that the legal costs element of the Patpol bill will be likely to be recovered on a detailed assessment. In my view, it falls on the wrong side of the line drawn by Mr Justice Jacob (as he then was) in the Mars v Teknowledge case.
11. Accordingly, it seems to me that I should leave most of that sum out of account, but I say most for this reason. Patpol were on any footing acting as interpreters. There obviously had to be interpretation. Bühler decided to take on a Polish company. That Polish company has been successful in litigation and, at the very least, proper translation costs for that must be allowed. It seems to me, therefore, that the translation element of those costs is something which I should be prepared to make an interim payment in respect of. The trouble is I do not know what that element is, both in terms of time and costs. I can see that it will be significant. I can see that there would have to be translations of draft experts' reports passing to and fro and experts' reports from the other side when obtained. The prior art would no doubt have to be explained and interpreted and a lot of law would have to be explained and interpreted. I can see that the bill could be fairly substantial, but nobody has attempted to suggest what it might be.
12. In the circumstances, the rough and ready element of the costs assessment very definitely has to be brought into play in relation to those costs. I do not propose to put a figure on the sum that I am allowing as part of the overall sum that I allow at the end of the day. The essential point for this part of my judgment is that I do not take into account any part of the £360,000 paid in respect of Patpol as legal costs for these purposes. For the purposes of this exercise, I merely add some sum back in at the end of the day in order to arrive at what I regard to be a fair amount.
13. I turn, therefore, to the second basis on which Mr Hacon for Bühler seeks to reduce the amount of the interim payment. If one strips out the entirety of the Patpol bill of £360,000 from the gross of £1.034 million, one comes down to roughly £670,000. Mr Hacon reduces the amount of any interim award by a process of applying the hours spent by the patent agents instructing him, reducing the chargeable rate of, in particular, the partner of Simmons & Simmons involved and then making a further discount of 50% to reflect likely or possible further irrecoverable elements. At the end of that exercise, he reduces the amount of the interim payment to £240,000.
14. I will not go into the detail of Mr Hacon's exercise. To some extent, it involves a significant amount of double counting and, to a lesser extent, false assumptions as to the reasonableness of time spent. For example, Mr Hacon's case involves an assumption that the hours spent by those instructing him should be taken as being a proper sum for today's purposes for the number of hours which Simmons & Simmons should have spent. I do not accept that as necessarily a correct premiss. A person seeking to attack a patent is very likely to be going to be, it seems to me, spending more legal hours than a person maintaining the patent. That is an entirely plausible and justifiable state of affairs.
15. Assessing payments on account is, as has been observed in countless cases, a rough and ready exercise. There is no precise science involved. At the end of the day I have to carry out the exercise which I have described earlier in this judgment. Taking out the large Patpol element and adding something back in for interpreters, and without being able to do that precisely, it seems to me that an appropriate interim payment of costs in respect of this case, using as the base charge the £670,000 plus some interpreters' mark, is £400,000, and I shall so order.

Further legal argument

16. I propose to order interest to be paid on costs from the date on which the costs were actually paid, whether on account or otherwise. Mr Hacon takes the point that the costs of that exercise, effectively of slicing up each payment into allowed and disallowed costs and then running the interest calculation on that, is not worth the interest involved in this case. He urges on me, as I understand it, that I should simply order interest on the costs to be calculated on the final amount allowed as from the date of this judgment.
17. That does not seem to me to achieve justice between the parties, especially since there is a very large sum, the £360,000 Patpol cost to which I have already referred, which may have to come into the calculation. It would seem to me to be grossly unjust, should Spomax be allowed all or a large proportion of those Patpol costs, that they should recover no interest save from the date of the judgment. They are, in terms of this action, quite historic.
18. In those circumstances, I shall make the order for costs proposed by Mr Lykiardopoulos as set out in paragraph (7) of the draft order. The costs of today are costs in the case.