Virgin Atlantic Airways Ltd v Zodiac Seats UK Ltd: SC 3 Jul 2013

Virgin Atlantic Airways Ltd sought to recover damages exceeding 49,000,000 pounds for the infringement of a European Patent which did not exist in the form said to have been infringed. The Technical Board of Appeal of the European Patent Office had retrospectively amended it so as to remove with effect from the date of grant all the claims said to have been infringed.
Held: Where a judgment had been given by an English court that a patent was valid and infringed, but the applicable patent was subsequently retrospectively revoked or amended, whether in England or at the European Patent Office, the defendant was entitled to rely on that revocation or amendment on an inquiry as to damages in respect of the unamended patent.
‘There are two related reasons why Zodiac cannot be precluded from relying on the decision of the TBA on the enquiry as to damages. One is that they are relying on the more limited terms of a different patent which, by virtue of the decision of the TBA, must at the time of the enquiry be treated as the only one that has ever existed. The other is that Zodiac are not seeking to reopen the question of validity determined by the Court of Appeal. The invalidity of the patent may be the reason why the TBA amended the patent, but the defendant is relying on the mere fact of amendment, not on the reasons why it happened.’
Lord Sumption analysed the defence of res judicata: ‘Res judicata is a portmanteau term which is used to describe a number of different legal principles with different juridical origins. As with other such expressions, the label tends to distract attention from the contents of the bottle.
The first principle is that once a cause of action has been held to exist or not to exist, that outcome may not be challenged by either party in subsequent proceedings. This is ’cause of action estoppel’. It is properly described as a form of estoppel precluding a party from challenging the same cause of action in subsequent proceedings.
Secondly, there is the principle, which is not easily described as a species of estoppel, that where the claimant succeeded in the first action and does not challenge the outcome, he may not bring a second action on the same cause of action, for example to recover further damages: see Conquer v. Boot [1928] 2 K.B. 336.
Third, there is the doctrine of merger, which treats a cause of action as extinguished once judgment has been given on it, and the claimant’s sole right as being a right on the judgment. Although this produces the same effect as the second principle, it is in reality a substantive rule about the legal effect of an English judgment, which is regarded as ‘of higher nature’ and therefore as superseding the underlying cause of action: see King v. Hoare (1844) 13 M and W 494, 504 (Parke B) . .
Fourth, there is the principle that even where the cause of action is not the same in the later action as it was in the earlier one, some issue which is necessarily common to both was decided on the earlier occasion and is binding on the parties: Duchess of Kingston’s Case (1776) 20 State Tr 355. ‘Issue estoppel’ was the expression devised to describe this principle by Higgins J in Hoysted v. Federal Commissioner of Taxation (1921) 29 CLR 537, 561 and adopted by Diplock LJ in Thoday v. Thoday [1964] P 181, 197-198.
Fifth, there is the principle first formulated by Wigram V-C in Henderson v. Henderson (1843) 3 Hare 100, 115, which precludes a party from raising in subsequent proceedings matters which were not, but could and should have been raised in the earlier ones.
Finally, there is the more general procedural rule against abusive proceedings, which may be regarded as the policy underlying all of the above principles with the possible exception of the doctrine of merger.’
Lord Sumption described the phrase ‘res judicata’ as ‘a portmanteau term which is used to describe a number of different legal principles with different juridical origins.’

Lord Neuberger, President, Lady Hale, Lord Clarke, Lord Sumption, Lord Carnwath
[2013] UKSC 46, [2013] 3 WLR 299, [2014] 1 AC 160, [2013] WLR(D) 265, [2013] RPC 29, [2013] 4 All ER 715, UKSC 2010/0013
Bailii, Bailii Summary, WLRD, SC Summary, SC
Patents Act 1977, European Convention on the Grant of Patents
England and Wales
CitedCoflexip Sacoflexip Stena Offshore Limited v Stolt Offshore Limitedstolt Offshore Limited Stolt Offshore A/S CA 13-Mar-2003
In proceedings already heard the defendant had been found liable for patent infringement, and damages remained to be assessed. They claimed for loss of profits and royalties, and for damages through dilution of the market. The claimants said that to . .
CitedUnilin Beheer Bv v Berry Floor Nv and others CA 25-Apr-2007
The patent at issue was retrospectively amended by the EPO to limit its scope to valid claims, after the English court had given judgment in favour of the patentee. The ‘vexation’ associated with the pursuit of two proceedings challenging the . .
CitedGlaxo Group Ltd v Genentech Inc and Another CA 31-Jan-2008
The validity of a patent was challenged at the same time in both UK and European courts. Mummery LJ discussed the inherent consequences of a race between the jurisdictions: ‘the possibility of the duplication of proceedings contesting the validity . .
CitedThe Duchess of Kingston’s Case 1-Apr-1776
On plea, sentence in ecclesiastical Court ex directo in a matter properly cognizable there, is conclusive evidence where the same matter comes into question collaterally in a court of law or equity.
A sentence of jactitation is not conclusive . .
CitedKing and Another v Hoare 25-Nov-1844
A judgment (without satisfaction) recovered against one of two joint debtors is a bar to an action against the other: – Secus where the debt is joint and several. – And it is pleadable in bar, and not in abatement. – Such a plea need not contain a . .
CitedHoysted v Federal Commissioner of Taxation 16-Dec-1921
High Court of Australia – Higgins J coined the term ‘issue estoppel’. . .
CitedConquer v Boot CA 1928
The householder recovered damages in the county court in an action against a builder for breach of a building contract to complete the works in a good and workmanlike manner. He then brought a second action upon the same contract. In the second . .
CitedHenderson v Henderson 20-Jul-1843
Abuse of Process and Re-litigation
The court set down the principles to be applied in abuse of process cases, where a matter was raised again which should have been dealt with in earlier proceedings.
Sir James Wigram VC said: ‘In trying this question I believe I state the rule . .
CitedThoday v Thoday CA 1964
The court discussed the difference between issue estoppel, and action estoppel: ‘The particular type of estoppel relied upon by the husband is estoppel per rem judicatam. This is a generic term which in modern law includes two species. The first . .
CitedJohnson v Gore Wood and Co HL 14-Dec-2000
Shareholder May Sue for Additional Personal Losses
A company brought a claim of negligence against its solicitors, and, after that claim was settled, the company’s owner brought a separate claim in respect of the same subject-matter.
Held: It need not be an abuse of the court for a shareholder . .
CitedArnold v National Westminster Bank Plc HL 1991
Tenants invited the court to construe the terms of a rent review provision in the sub-underlease under which they held premises. The provision had been construed in a sense adverse to them in earlier proceedings before Walton J, but they had been . .
CitedYat Tung Investment Co Ltd v Dao Heng Bank Ltd PC 1975
Restraint of Second Action as Abuse
Hong Kong – A company purchased a property from the defendant bank who had taken it back into possession from a former borrower. The company itself fell into arrears, the property was taken back again and resold. The company sought a declaration . .
MistakenPoulton v Adjustable Cover and Boiler Block Co CA 1908
The Plaintiff patent holder had obtained judgment, an injunction and damages against the Defendant for patent infringement despite a defence of invalidity based on prior art. The Defendant then acquired information about other instances of prior art . .
MistakenCoflexip S A and Another v Stolt Offshore Ms Ltd and others CA 27-Feb-2004
Proceedings had been brought by a third party in which the patent had been revoked. The Defendant in the first proceedings now sought release from an enquiry as to damages after being found, before the revocation, to have infringed the patent.
CitedUnilin Beheer Bv v Berry Floor Nv and others CA 25-Apr-2007
The patent at issue was retrospectively amended by the EPO to limit its scope to valid claims, after the English court had given judgment in favour of the patentee. The ‘vexation’ associated with the pursuit of two proceedings challenging the . .
CitedIn re Waring, Westminster Bank v Burton-Butler ChD 1948
(i) an annuitant under a will was bound by a decision of the Court of Appeal in earlier litigation, where the will trustees and he were parties, as to the effect of tax legislation on his rights, but (ii) another annuitant was entitled to rely on a . .
CitedThrasyvoulou v Secretary of State for the Environment HL 1990
A building owner appealed against enforcement notices which alleged that there had been a material change of use of his buildings in 1982. This notice was issued by a planning authority. As a result of the appeal an inspector determined that the . .
CitedHindcastle Ltd v Barbara Attenborough Associates Ltd and Others HL 22-Feb-1996
The guarantor of an original tenant under the lease remains liable after the disclaimer the lease on insolvency. The disclaimer operates to determine the lease altogether with the result that the landlord’s reversion is accelerated. ‘In order to . .

Cited by:
CitedYoungsam, Regina (on The Application of) v The Parole Board Admn 7-Apr-2017
The claimant challenged being recalled to prison from licence after being found in an area from which he was excluded as a condition of his parole. . .
CitedMoorjani and Others v Durban Estates Ltd and Another TCC 15-May-2019
Allegations of breach of landlords’ repairing obligations – defendants’ strike out application.
Held: ‘ the critical question is whether this second action is based on the same cause, or causes, of action, and not whether it pleads the same . .
CitedSpicer v The Commissioner of Police of The Metropolis QBD 6-Jul-2020
The claimant alleged defamation. He had been acquitted of a criminal offence and said that material published by the defendant continued to imply or assert his guilt of the offence. The defendant argued truth. The claimant now sought a strike out of . .
CitedTakhar v Gracefield Developments Ltd and Others SC 20-Mar-2019
The claimant appellant alleged that properties she owned were transferred to the first defendant under undue influence or other unconscionable conduct by the second and third defendants. The claim was dismissed. Three years later she claimed to set . .

Lists of cited by and citing cases may be incomplete.

Intellectual Property, Damages

Updated: 21 January 2022; Ref: scu.512119