05-10-2011

Late Legal Representation Proves Expensive

When the material was spotted by the company that owns the copyright, the director claimed that his company had no liability to it because he had permission from others (not the copyright owner) to republish the material. However, the businesses named had no legal right to permit republication.
 
Under copyright law, if permission had been given incorrectly, the position would be that the other businesses could be ‘joined in the action’ for facilitating the breach of copyright or the infringing company could have the right to claim its damages payable from them. That would enable the infringing company not to lose out from an honest mistake. The argument advanced is not a defence, however: no one can assign a right they do not have.
 
The director of the company continued to deny liability and offered £500 in settlement of the claim. After declining the claimant’s request for mediation, the dispute dragged on for nearly a year and he only obtained professional legal advice after the case was about to be listed for a court hearing. Once solicitors had been engaged, it was only a matter of weeks before an offer was made to settle the dispute out of court by payment of damages of £5,000.
 
However, when it came to the assessment of legal costs, it was a different matter altogether. The claimant’s agreed legal costs, which it had been agreed would be paid by the infringing company, were more than double the amount of the damages. In addition, the man’s company had to pay its own legal costs.
 
This case shows how important it is to obtain legal representation early when a dispute arises. Failing to understand the applicable law can mean the wrong principles are applied and attempts to resolve the dispute will founder. In this case, the total payable by the company is approximately three times the sum that it would have cost to settle the matter out of court at an early stage.