Vestergaard Frandsen A/S & Ors v Bestnet Europe Ltd & Ors [2013] EWCA Civ 428 (25 April 2013)

Vestergaard Frandsen A/S & Ors v Bestnet Europe Ltd & Ors [2013] EWCA Civ 428 (25 April 2013)

It is inappropriate to strike out claims for damages or equitable compensation for derived products at the pleading stage in breach of confidence cases. The assessment of damages, including whether to limit recovery to head start damages or allow lost profits/royalties for derived products, should be determined after all relevant facts are established. Both classes of products may benefit from misuse of confidential information to differing degrees, and the proper measure of damages can only be decided after factual inquiry.

Citation
[2013] EWCA Civ 428
Parties
Claimant/respondent: Vestergaard Frandsen A/S (now called MVF 3 Aps); Claimant/respondent: Vestergaard Frandsen SA; Claimant/respondent: Disease Control Textile SA; Defendant/appellant: Bestnet Europe Limited; Defendant/appellant: 3T Europe Limited; Defendant/appellant: Intection Limited; Defendant/appellant: Intelligent Insect Control Limited; Defendant/appellant: Torben Holm Larsen
Jurisdiction
England and Wales
Judgment Date
25 April 2013
Procedural Posture
Civil Appeal / Appeal From High Court (chancery Division, Intellectual Property) to Court of Appeal
Outcome
Appeal dismissed
Legal Topics
Breach of Confidence, Damages Assessment, Injunctions, Trade Secrets, Remedies, Head Start Damages
Intellectual Property Equity Tort Breach of Confidence Damages Assessment Injunctions Trade Secrets Remedies +1 more

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Parties

Vestergaard Frandsen A/S (now called MVF 3 Aps)

Claimant/respondent

Vestergaard Frandsen SA

Claimant/respondent

Disease Control Textile SA

Claimant/respondent

Bestnet Europe Limited

Defendant/appellant

3T Europe Limited

Defendant/appellant

Intection Limited

Defendant/appellant

Intelligent Insect Control Limited

Defendant/appellant

Torben Holm Larsen

Defendant/appellant

Procedural Posture

Civil Appeal / Appeal From High Court (chancery Division, Intellectual Property) to Court of Appeal

Legal Issues

  1. 1 Whether damages for breach of confidence can be claimed for products derived from misuse of confidential information, not just those directly made using it
  2. 2 Whether the claim for damages or equitable compensation for derived products should be struck out at the pleading stage
  3. 3 Whether damages should be limited to a 'head start' period or can include lost profits/royalties for all derived products

Ratio Decidendi

It is inappropriate to strike out claims for damages or equitable compensation for derived products at the pleading stage in breach of confidence cases. The assessment of damages, including whether to limit recovery to head start damages or allow lost profits/royalties for derived products, should be determined after all relevant facts are established. Both classes of products may benefit from misuse of confidential information to differing degrees, and the proper measure of damages can only be decided after factual inquiry.

Court Disposition

Appeal dismissed

Orders

  • The appeal to strike out parts of the Amended Points of Claim relating to derived products is dismissed.
  • The claimants are permitted to pursue damages or equitable compensation claims for both direct and derived products.