The High Court has reserved the costs of an interlocutory anti-suit injunction hearing until the trial of an action concerning a patent assignment and settlement agreement.
In a judgment delivered on 7 December 2017, Ms Justice Creedon said a trial judge would be better placed to assess who should bear the costs because oral evidence and discovery could affect the court’s earlier view of the facts.
Mortimer John Walters and Brian Connell had sought to prevent James Patrick Flannery and Lexington Services Limited from pursuing proceedings in Virginia. The plaintiffs argued that the US litigation was linked to alleged defaults under settlement terms that designated Ireland as the forum for disputes arising from that agreement.
The defendants maintained that the Virginia proceedings concerned a later patent assignment agreement, which designated the Federal Court of Virginia as the forum for related disputes. The agreement purported to transfer the patent to Delaware company Delegate LLC for €100. The parties disputed whether Walters signed as a receiver or in an individual capacity on behalf of Lexington Services.
The High Court had refused the plaintiffs’ injunction application in an ex tempore decision on 11 October 2017. At that interlocutory stage, the court found the Virginia State Court proceedings concerned the validity of the assignment, rather than the settlement terms. It held that the settlement agreement’s Irish jurisdiction clause was not triggered and that continuing the Virginia proceedings was not oppressive or vexatious. Those were limited findings based on the evidence then available.
At a separate costs hearing on 3 November, the defendants argued that costs should follow the outcome of the injunction application. They submitted that the plaintiffs had failed to establish a fair question to be tried and that the decision turned on contractual interpretation unlikely to change at trial. The plaintiffs said issues remained live and argued that facts considered at the interlocutory hearing could be examined further in the substantive proceedings.
Justice Creedon said the earlier application was fact-dependent. The court had concluded, on limited evidence, that the foreign litigation centred on the assignment agreement. Discovery and oral testimony at trial could lead the trial judge to a different view, she said. The judge therefore reserved the costs of the interlocutory hearing to the trial of the action.
The judgment recorded that the Virginia State Court proceedings had been dismissed for lack of personal jurisdiction. It also noted that the defendants’ earlier federal proceedings had been dismissed for lack of subject-matter jurisdiction, and that their counsel said those proceedings would be appealed. The costs judgment did not decide the ultimate merits of the patent assignment dispute.