In a recent decision the High Court awarded £450,000 including a 200% uplift for additional damages to a claimant whose unregistered design rights in “bodycon” and “bandage” dress designs had been infringed in a flagrant manner.
In Original Beauty & others v G4K Fashion & others, the High Court found that the defendant, trading as Oh Polly, had infringed 20 of the claimant’s UK and EU unregistered design rights relating to their dresses.
In a recent damages enquiry the Court found that the defendant’s “couldn’t care less” attitude towards the claimant’s intellectual property, demonstrated not least by deliberate orders to a factory to copy the claimant’s products, warranted additional damages.
The total of £450,000 was awarded in three different categories.
Firstly, the Court awarded £75,000 in standard damages to compensate the claimant’s lost profits as estimated by the Court based on common sense and fairness. The Court estimated that the claimant would have made 20% of the defendant’s sales had they not infringed the former’s rights.
Secondly, the claimant was granted a reasonable royalty on the remaining 80% of the defendant’s remaining sales. The royalty was assessed on the basis of 10% of the defendant’s net sales, including a guaranteed minimum royalty of £4,000 per design, totalling £75,000.
Finally, the Court awarded £300,000 in additional damages pursuant to its finding of flagrant infringement. Unlike standard damages, these may be punitive to act as a deterrent to other would-be infringers (see para. 141 and 153). In ensuring that the damages are effective, proportionate, and dissuasive but not an abuse of power, the Court settled on an uplift of 200% on the standard damages. Paragraph 145 of the judgment contains a useful table of additional damages awards in previous cases.
In view of the exceptionally large additional damages award, combined with the broadly interpretable principles of effectiveness, proportionality, and dissuasion on which the additional damages were based, the case will be a powerful precedent for intellectual property rights holders seeking to enforce their rights and to deter potential future infringers.
Although the case relates to unregistered design rights, its principles also apply to copyright claims. The Court’s approach will be welcomed by other rights holders such as photographers whose works are also infringed in often blatant ways. Flagrant infringers can expect to see demands for triple damages citing Original Beauty.
(With thanks to Swan Turton paralegal Camille Beckmann.)