Date:
20131017
Docket:
T-735-11
Citation:
2013 FC 1050
Ottawa, Ontario,
October 17, 2013
PRESENT: The
Honourable Mr. Justice Barnes
BETWEEN:
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ABB TECHNOLOGY AG,
ABB INC. AND
ABB AG
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Plaintiffs
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and
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HYUNDAI HEAVY INDUSTRIES CO.,
LTD.
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Defendant
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SUPPLEMENTARY REASONS
FOR JUDGMENT AND JUDGMENT
[1]
In
my decision dated September 11, 2013 (see ABB Technology AG, ABB Inc. and ABB
AG v Hyundai Heavy Industries Co., Ltd., 2013 FC 947), I dismissed the
Plaintiffs’ action against the Defendant and allowed the Defendant’s
counterclaim declaring the Plaintiffs’ patents to be invalid. The issue of
costs was reserved pending further submissions from the parties.
[2]
The
Defendant argues for a departure from the Court tariff seeking to recover
one-half of its actual legal costs ($2,809,161 ÷ 2 = $1,404,580.50) and all of
its disbursements ($451,733.81). In the alternative, the Defendant seeks costs
at the highest end of Column IV which it has calculated in the amount of $289,495.00
plus disbursements. In the further alternative, the Defendant requests an
Order directing the assessment of its costs at the highest end of Column IV.
[3]
The
Plaintiffs argue that this case does not justify a departure from the Court
tariff. It proposes allowable fees not exceeding $75,337.50 based on the
application of the tariff at the mid-point of Column III. The Plaintiffs also
take issue with a number of the disbursement items claimed on the basis that
they are either unjustified or unsubstantiated.
[4]
This
case exemplifies the growing disparity between the Federal Court tariff and the
actual costs of patent litigation, but that alone is not a basis for departing
wholly from the tariff in assessing costs. If it were otherwise the tariff
would rarely, if ever, be used in cases of this type. On the other hand, this
litigation included several aspects that justify a premium in the award of
costs.
[5]
This
case involved two large multi-national companies in a contest over a lucrative electrical
switchgear market in British Columbia. The Plaintiffs were obviously concerned
about the loss of market share to an incoming and aggressive Korean
competitor.
[6]
Although
the case was tried in Canada most of the evidence was held elsewhere.
Substantial parts of the evidentiary record required translation and discovery
examinations of the Plaintiffs’ witnesses were conducted in Germany. Document productions were extensive and required Defendant’s counsel to travel to
Korea. An inspection of the Defendant’s products was carried out in Vancouver in the presence of counsel.
[7]
About
one month before the trial, the Defendant served an Offer to Settle that called
for dismissal of the action and counterclaims and the payment to the Defendant
of its assessed costs calculated to April 24, 2013. The Plaintiffs say that
the Offer “was not calculated to settle the case”. Nevertheless, it
represented a better outcome for the Plaintiffs than the judgment that was
ultimately rendered. The Plaintiffs’ claims were tenuous at best and,
notwithstanding its lateness, the Defendant’s Offer should have received
serious consideration by the Plaintiffs.
[8]
In
all of the circumstances of this case an award of party-and-party costs in the
amount of $350,000.00 is justified.
[9]
The
claim for disbursements will require an assessment, in part, because the
amounts sought are not sufficiently detailed to permit the Court or the
Plaintiffs to assess their accuracy or reasonableness.
[10]
I
do not agree that the Defendant’s retention of two experts was unwarranted.
The expert fees claimed do not appear to be inordinate but their reasonableness
must be assessed. The hourly rates for the expert witnesses will, however, be
fixed at the lesser of the rates actually charged or the hourly rate of the Defendant’s
most senior legal counsel.
[11]
Subject
to documentary verification, hotel, meals and business class travel expenses
are allowed for witnesses who testified, for Mr. Albert Kim and for two senior
counsel and one junior counsel where those counsel actually attended. Travel
expenses for the Defendant’s in-house counsel and other non-testifying
corporate representatives to attend the trial and discoveries are not allowed.
For greater certainty, the travel expenses of counsel to attend in Korea, Germany and Vancouver in advance of the trial are allowed.
[12]
The
Defendant’s costs of retaining a German patent agent and United States counsel have not been justified to my satisfaction and are not allowed.
[13]
Subject
to verification, all translation expenses are allowed.
[14]
The
remainder of the Defendant’s disbursements will be subject to verification and an
assessment for their reasonableness.
JUDGMENT
THIS
COURT’S JUDGMENT is that the Defendant’s party-and-party legal
costs are fixed in the amount of $350,000.00.
THIS
COURT’S FURTHER JUDGMENT is that the Defendant’s disbursements are
to be assessed in accordance with these Reasons.
"R.L.
Barnes"
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