Who: Gama Healthcare Ltd (“Gama”) and Pal International Ltd (“Pal”)
Where: Intellectual Property Enterprise Court (IPEC), UK
When: 24 July 2015
Law as stated at: 5 August 2015
Gama alleged passing off in relation to the alleged confusing similarity between its packaging for its “Clinell” wet wipe products (below left) and that used by Pal (below right) for its “Medipal” wipes.
The interlocutory skirmish focused on Gama’s application to amend its particulars of claim to allege that there would be post-sale confusion when its products were reordered. Due to the similarity of the packaging and products, they contended that Pal’s product code would either be mistaken for its own, or mistakenly taken from Pal’s marketing materials by consumers who intended to order Gama’s products. As such, Gama submitted that Pal’s products were instruments of deception calculated to deceive end users, giving rise to damage to its goodwill in the distinctive features of its packaging.
As the case is being conducted in the IPEC, a (relatively) inexpensive forum for such IP disputes, where costs are capped at £50,000, any amendment would need to meet the “cost-benefit” test set out in CPR 63.23(2).
Gama submitted that the amendments were no more than particulars of arguments that had already been raised and no further evidence or disclosure would be required from it. In addition it required only a limited disclosure from Pal, who would still have plenty of time to deal with the new arguments before trial, one of which was the alleged misapplication of Pal’s wet wipe training guidance to its own product.
Pal submitted that due to the costs cap in the IPEC, its costs were unlikely to be recovered; the cost-benefit test applicable in the IPEC weighed against amendment and there was a lack of exceptional circumstances to permit amendment under CPR 63.23(2).
Judge Hacon held that CPR 63 had three purposes:
- (i) to require the parties to work out the totality of the case by the time of the case management conference (the “CMC”);
- (ii) the provision of all evidence for a full understanding of the case by the time of the exchange of evidence at the CMC to promote settlement before trial and accurate Part 36 offers; and
- (iii) to minimise applications between the CMC and trial prompted by late ideas of what might be argued at trial.
Rule 63.23(2) of the CPR provided that “save in exceptional circumstances, the court will not permit a party to submit material in addition” to that ordered following the CMC. Therefore the first question was the meaning of “material”. Amendments to pleadings did not constitute additional material but to the extent that they required further evidence, that would only be allowed in exceptional circumstances.
In the IPEC, up to a point, it was always a judgment call whether certain aspects of an argument should be in a pleading, or whether to leave those to be dealt with in evidence or in a skeleton argument.
The amendments sought by Gama passed the test in CPR 63.23(2) but also needed to meet the cost benefit test in the IPEC. None of the amendments were key or central matters that were going to be highly material at trial. In relation to one proposed amendment, the matters had already been dealt with in Gama’s evidence and substantially dealt with by Pal, so that, if allowed, few additional costs would be generated. However, if another amendment was allowed, Pal should be allowed to deal with the issue of training in relation to the wet wipes and whether that was liable to lead to misuse of its wipes as alleged by Gama; that issue could lead to more substantial evidence or cross-examination at trial and its effect on the trial outcome could not now be known.
On balance, the amendments were permitted, subject to one aspect of alleged post-sale confusion; this had been taken at the CMC and could not be raised again. Pal was permitted to adduce evidence in relation to wet wipe training in NHS hospitals and any further evidence thought appropriate, and, after trial, may wish to make further submissions in relation to costs incurred by that evidence.
Why this matters:
This provides clarification on what type of amendments may be made post-CMC. However, it should be noted that the amendments in this case do not introduce a new issue or a previously unforeseen claim. It should also be noted that this claim is based on passing off, where the demonstration of the tort can be characterised in many different ways. If the action were for trade mark or patent infringement, it may be that the Court will be more reluctant to allow such post-CMC amendments.