H Young (Operations) Ltd v Medici Ltd

J U D G M E N T

1. THE VICE-CHANCELLOR: The judgment I am about to give is the judgment of the court. This is the application of the appellant for the adjournment of the hearing of the appeal from part of the order of Jacob J made on 14th July 2003. The judge had to deal with a number of miscellaneous issues in a trademark dispute but the important point, for present purposes, is that he refused an order for partial revocation of Young's trademark to the extent sought by Medici.

2. On 2nd February 1996 the trademark, "Animal" was registered in the name of "Animal Ltd" under number 2,054,886 in respect of a number of classes, including Class 25, described as clothing, footwear, headgear, baseball caps, sweatshirts and T-shirts. The trademark was assigned by Animal Ltd to the claimant, H Young Operations Ltd, on 30th January 1999. On 21st June 2002, they issued the claim form against Medici claiming injunctive and other relief in respect of the alleged infringement of the trademark.

3. On 10th November 2002 Medici served its defence and counter claim. Amongst other relief sought in the counter-claim is:

"An order that United Kingdom Registered Trade Mark No 2,054,886 be revoked as of 15th March 1997, alternatively 1st April 2002:

. . . in so far as it is registered in respect of goods extending beyond the following:

(f) in class 25:

(i) T-shirts, trousers, shorts, shirts, sweatshirts, all being casual surf-type wear for men;

(ii) T-shirts, trousers, shorts, skirts, denim jackets, vests with straps, hooded sweatshirts, all being casual surf-type wear for women aged under 30;

(iii) Casual footwear;

(iv) Baseball caps;

(v) Knitted hats."

4. It now transpires that the goods in respect of which complaint was made are designed and made by a French national, Mr Ruc, or his company Mitragarment, in Indonesia, and that the defence of Medici Ltd was pursued in its name, but at the expense of Mr Ruc or his firm, through French lawyers called Silvain Meyer. The French lawyers, in turn, instructed English solicitors Picton Howell who appeared on the record, for most of the material time, as the solicitors for Medici.

5. Jacob J gave judgment on 14th July 2003. He refused to limit the specifications in Class 25 by reference to the clothing being "surf-type" or aimed at under 30-year olds. He gave permission to appeal and Medici's appellant's notice was issued on 7th August 2003. The restriction which it sought in relation to the Class 25 clothing description to which the trademark was to relate was "casual surf-type for men" and "casual surf-type wear for women aged under 30."

6. On 21st August 2003, the respondent's notice was issued. They took a number of points, one of which is that even if Medici is otherwise right, the grounds specified in its appellant's notice are not sufficient in themselves to justify allowing the appeal in the respects they claim. In due time, in the ordinary course of events, the skeleton argument for Medici was served on 2nd October 2003, having been prepared by a junior counsel for Medici who had appeared at the trial and appears before us, Mr J Mellor. The skeleton argument goes to some length and detail into to the law and facts relating to the client's case, but nowhere suggests that one possible course would be to make a reference of a particular question or a new question to the European Court of Justice.

7. At the turn of this year there seems to have been some doubt as to who was really instructed on behalf of Medici. Between January and February 2004, Hextalls, who now appear on this application on their behalf, appear to have been instructed instead of Picton Howell and, indeed, gave notice of change to that effect. It appears that the reason for that change was that Mr Clinch, who had been Medici's solicitor, had moved from that firm to Hextalls and, on the face of it, Medici wished to follow him. However, on 15th March 2004 Picton Howell were reinstructed and went back on the record. The consequence of this change of solicitors was that in the meantime, a directions hearing fixed for 11th February 2004 had to be adjourned due to the changes in solicitors apparently instructed by Medici.

8. As the hearing of the appeal came closer, communications between the parties' respective solicitors and counsel ensued. On 5th April 2004, junior counsel for Young sent an email to Mr Mellor, junior counsel for Medici, seeking to agree a bundle of authorities but got no response. On 22nd April 2004 the solicitors for Young wrote to those on the record for Medici to ask if Mr Mellor was still instructed. On Tuesday 27th April 2004 it now seems there was a lengthy meeting between Medici and its solicitors, and I think the solicitors Silvain Meyer from France. As a consequence of that meeting, Picton Howell confirmed to the solicitors for Young that the appeal was proceeding and the brief was indeed delivered to Mr Mellor at the end of that day.

9. Overnight it now appears there was some change of heart and on Wednesday 28th April 2004 there was a telephone conversation between the solicitors for the parties and, following that, a letter from Medici's solicitors to the effect that the latter did not intend to proceed with the appeal. The reason appeared to be that Mitragarment and/or Silvain Meyer, who were funding the appeal, had asked them to withdraw it. On Thursday 29th April, Picton Howell wrote to the Listing Office of the Court of Appeal to confirm that the appeal would not proceed. Then on Friday 30th April a notice of change of solicitors was received, and Hextalls informed the Court of Appeal Listing Office that they were now instructed to act for Medici, and would apply at the hearing (that is to say, today) for an adjournment of it. The explanation was given to Listing regarding the involvement of Mitragarment and Silvain Meyer.

10. One of the reasons given in the communication with the Court of Appeal office that day was that the former solicitors, Picton Howell, were seeking to rely on a lien over the papers which would preclude any preparation by new solicitors or junior counsel. That appeared to Lord Justice Chadwick to be an inadequate response, and he arranged for bundles to be collected from his clerk so they might be copied and used without any further delay of the appeal. Between Friday 30th April and Monday 3rd May, Monday being the Bank Holiday, junior counsel for Medici told us today that he worked in connection with an arbitration. The time for the document which he was preparing had been extended by the arbitrators from Friday 30th to Tuesday 4th May, and in light of the fact he believed he was then free to use that time to deal with arbitrations rather than the preparation of his appeal.

11. On Tuesday 4th May, an application was made in proper form, issued by Hextalls on behalf of Medici and supported by a witness statement of Medici's manager, Mr Goodman. The stated ground in the witness statement is that Medici has not had enough time to prepare for the appeal. Then on the same day, yesterday, evidence in answer was made in a witness statement for Young, opposing the adjournment for the reasons given in that witness statement. Today, 5th May, was the first day of the two-day hearing which had been fixed some months ago.

12. Medici submits that it has had insufficient time to prepare for this appeal following the uncertainties of last week. Mr Mellor suggests that three days are needed which, he suggests appears from Young's skeleton argument, will be needed, though he could have been ready to argue for a reference to the European Court of Justice today but has not been instructed to do so. He suggests that a point of principle is involved of some importance, namely whether the test of "fair description" applied by Jacob J in the court below, following two recent decisions of the Court of Appeal, is a test which would be consistent with the European law on trademarks, which he suggested it is not. The Court of Appeal, in the two decisions to which I have referred, did not find it necessary to make a reference in either of those cases and did, in those cases, approve a test of fair description as applied by Jacob J. It is submitted on behalf of Medici that the problems it faced were not of its own making, but due to the late change of mind of Silvain Meyer or Mr Ruc, or both.

13. In opposing the adjournment, counsel for Young frankly admits that no prejudice would be sustained by his client beyond that which is inherent in prolonging uncertainty for a further six months, and the fact that even indemnity costs could not provide complete indemnity. He suggests that Medici is just unwilling to pay the costs incurred in pursuing the appeal and that, if it be the case, is not a sufficient ground for granting an adjournment of it. He points to the fact that Medici has its own remedy against Silvain Meyer and Mr Ruc if what the court was told is true.

14. We accept that the appeal raises a point of principle which will have to be resolved one day, namely whether the test of fair description formulated by the National Court is consistent with the European law on trademarks. That point may arise in this case. Equally, it may be that this case should be determined in the light of its own facts as, in effect, Jacob J did. Further, there is the point raised by Young that the grounds relied on by Medici, even if right, do not justify any different result. Therefore, one cannot be confident that the time counsel says he requires is not needed for the purpose, or that the appeal could be determined merely by considering the point of law and whether to make reference to the European Court of Justice. Accordingly, if the adjournment is refused it would appear that the appeal is bound to go by default.

15. We are concerned whether, as counsel for Young suggested, it is a proper case in which to allow an adjournment. A number of explanations have been given which have proved, on examination, to be incorrect and incomplete. Why is it that even now counsel is not instructed to argue even the point of law? It is said with force that if what Medici says is true, then they have their remedy against Silvain Meyer and Mr Ruc and no interest in pursuing the appeal against Young. It is also true that the court's time has been wasted and an appropriate share of its resources already allotted to this case. But if no prejudice is sustained by Young, and the orders we make as to costs ensure that that is the case, is it just to refuse an adjournment and in consequence strike out the appeal?

16. On balance, and not without hesitation, we do not think so. Accordingly, we grant the adjournment sought. We will order Medici to pay the costs occasioned by the adjournment to be assessed on the indemnity basis, and will make an order for interim payment of an amount we will consider further with counsel. We shall require security to be provided within 48 hours for the amount of the interim payment and if the interim payment is not made within 14 days of today, or the security not provided within the time directed, then we will order that the appeal be struck out. Finally, we direct that the appeal be listed to be reheard as soon as possible, if necessary without reference to the convenience of counsel for Medici.