Shenzhen Ske Technology Co Ltd v Bargain Busting Limited [2025] EWHC 1705 (Ch)

[2025] EWHC 1705 (Ch)Case No CH-2024-000288
IN THE HIGH COURT OF JUSTICE
BUSINESS AND PROPERTY COURTS OF ENGLAND AND WALES (ChD)
ON APPEAL FROM THE UKIPO, TRADE MARKS REGISTRY
Venue Rolls Building, Fetter LaneDate 4 July 2025
London, EC4A 1NL
Before
MICHAEL TAPPIN KC(sitting as a Deputy Judge of the High Court)
Between
SHENZHEN SKE TECHNOLOGY CO LTDAppellantBARGAIN BUSTING LIMITEDRespondent
Written submissions by:Benet Brandreth KC and Laura Adde (instructed by Stobbs (IP) Ltd) for AppellantSam Carter (instructed by Brandsmiths) for Respondent
Judgment on costsI direct that no official shorthand note shall be taken of this judgment and that copies of the version as handed down may be treated as authentic.
[1]This is my decision on costs consequential on my judgment of 1 July 2025. I have considered the written submissions made by SKE and by BB (with accompanying costs schedules and correspondence) dated 3 July 2025. There is no dispute that SKE should pay BB’s costs of the appeal. I am asked to summarily assess those costs.[2]BB submits that the costs should be assessed on the indemnity basis, saying that SKE acted unreasonably in bringing and pursuing the appeal. I remind myself that an order for costs on the indemnity basis should only be made where there is “some conduct or some circumstance which takes the case out of the norm” – see the Excelsior case [2002] EWCA Civ 66.[3]BB supports its submission with four points. The first is that the appeal was hopeless. In Lejonvarn v Burgess [2020] EWCA Civ 114 at [44]-[45] and [52]-[68] Coulson LJ made it clear that an order for indemnity costs is appropriate where a reasonable party would have concluded that a claim was so speculative or weak that it should not be pursued. The question of whether this appeal falls into that category has given me considerable pause for thought. In the end, I have concluded that it does not. The appeal was a challenging one, and ultimately I was able to dismiss it in relatively short order, but I do not think I can say that SKE should reasonably have concluded that it was so weak or speculative that it should not be pursued.[4]Secondly, BB says that SKE had made it clear that, if its appeal failed and BB’s mark was registered and brought into in the High Court proceedings between the parties, it intended to advance the same arguments in response. BB says that it had invited SKE to withdraw its appeal and simply run its s.5(4)(a) arguments in the High Court proceedings. Therefore, BB says, the appeal was unnecessary, duplicative and wasteful. I do not agree that this takes the appeal “out of the norm” in a way which merits an award of indemnity costs. If SKE could have prevented BB’s mark being registered, that would have given it a significant benefit and avoided any High Court proceedings on the mark, including any argument about its entitlement to run s.5(4)(a) arguments in such proceedings. Any complaint about costs arising out of SKE running such arguments in those proceedings as well as on this appeal can be dealt with in those proceedings.[5]Thirdly, BB says that it put SKE on notice that it would seek indemnity costs if its appeal failed. That is not a reason for awarding indemnity costs. Finally, BB complains about various issues with the authorities bundle prepared by SKE. The points made do not begin to justify an award of indemnity costs.[6]For those reasons, I will assess costs on the standard basis. That requires me not to allow costs which have been unreasonably incurred or are unreasonable in amount, and only to allow costs which are proportionate to the matters in issue. I reject BB’s submission that, given that SKE decided to appeal to the High Court rather than the Appointed Person (where costs are awarded on a scale), it should be awarded substantially all its costs. The provisions of CPR 44 are not to be disregarded because an alternative forum was available in which costs recovery is more restricted.[7]BB’s schedule of costs claims a grand total of £123,916, of which £64,271 are solicitors’ costs and £59,175 are counsels’ fees. While I recognise that the appeal was of commercial significance, especially given the High Court proceedings between the parties, I have to say that I regard those costs as very high for an appeal of this nature. The appeal was against a decision on a single issue (whether SKE had shown protectable goodwill by the relevant date), required the production by BB of a single document (its skeleton argument) and was listed for a day but was always likely to require less time to argue (and in the event was finished in half a day). While it is correct to say that SKE had raised a point of law under its Ground 3, the scope for argument about that at High Court level was limited given the state of the authorities, and it was always unclear how the point of law could be engaged on the facts of this case. The fact that such a point of law was raised cannot explain the level of costs incurred, and indeed BB does not suggest that it does.[8]BB pointed to the fact that SKE’s schedule of costs indicated that its costs were of a similar order (a grand total of about £112,400, including solicitors’ costs of about £66,700 and counsels’ fees of about £32,900). It suggested that this indicated that SKE must have regarded costs of that order as proportionate. However, the fact that SKE incurred a similar level of costs does not indicate that it was reasonable or proportionate to do so. As Males LJ said in the Athena Capital case [2022] EWCA Civ 1061:
“the costs payable by the losing party on the standard basis are limited to those which are reasonable and proportionate. Where the costs of the paying party are also disproportionately high, that can make no difference. In any event the court will scrutinise costs schedules in order to keep levels of recovery within reasonable bounds.”
[9]SKE submitted that BB’s solicitors’ hourly rates were well in excess of the London 2 band of guideline hourly rates, which SKE submitted was the applicable band, and indeed even well in excess of the London 1 band rates. It referred me to the judgments of the Court of Appeal in Samsung v LG [2022] EWCA Civ 466 and Athena Capital for the propositions that(1) if a rate in excess of the guideline rate is to be claimed, a clear and compelling justification must be provided and(2) the London band 1 rate is directed to “very heavy commercial and corporate work by centrally London based firms”.[10]In my judgment this is not a case which falls into the London band 1 category – by no stretch of the imagination could this appeal be regarded as “very heavy”. Further, no justification (beyond the assertion that this was London band 1 work) was provided by BB for claiming a rate in excess of London band 2 (let alone in excess of London band 1) despite the point being raised by SKE in correspondence. I also regard some of the time spent as being excessive – for example BB’s statement of costs contains 26.7 hours of fee earner time on correspondence (other than with SKE) and 29.5 hours of fee earner time on preparation and review of skeleton arguments (despite its rejection of SKE’s submission that the time spent indicated that BB’s skeleton argument was “at least substantially” prepared by its solicitors).[11]BB’s counsels’ fees are also high given the nature of this appeal (over £40,000 for leading counsel and almost £19,000 for junior counsel). I accept that it was reasonable for BB to instruct leading and junior counsel. I also accept that some of the disparity between BB’s counsels’ fees and those incurred by SKE (in excess of £16,000) may be explained by the greater seniority of counsel instructed by BB. However, that does not mean that the level of counsels’ fees incurred was reasonable and proportionate, such that they should be visited on SKE in full.[12]SKE says that if BB’s solicitors’ fees were to be assessed at band 2 rates, its total costs would be about £93,800 rather than almost £124,000. However, as I have explained, I believe that both the hours spent by BB’s solicitors, and BB’s counsels’ fees, are too high to be regarded as reasonable and proportionate. Doing the best I can with the material I have, I am going to summarily assess BB’s costs in the sum of £75,000.

Cited in 1 later judgment