Facts:

In an interim judgment, the plaintiff was successful in its claim that the defendant had breached a confidentiality agreement entered into between the parties, and had breached the plaintiff’s New Zealand patent for a bottle opener by marketing in New Zealand, via the Internet, bottle openers based on the plaintiff’s patented design. The defendant did not appear.  Judgment was entered for damages based on a reasonable royalty rate together with interest.

In the same interim judgment, Toogood J expressed doubts as to the Court’s jurisdiction to adjudicate on the third and fourth causes of action in the plaintiff’s claim, namely actions founded on:

(a)   an alleged breach, in the United States, of the plaintiff’s equivalent United States patent; and

(b)   a claim for a declaration that the defendant had breached the Business and Professional Code of the State of California.

The Court reserved leave for the plaintiff to file further submissions as to the jurisdiction of the New Zealand Court to hear and determine these causes of action.   The relief sought in respect of infringement of the US patent comprised damages which the plaintiff accepted were likely to be minimal and, in any event, duplicative of those awarded under the action for infringement of the New Zealand patent.  However, in addition, the plaintiff sought increased damages based on the US Patents Act which allowed for an increase in damages where there had been wilful behaviour of the defendant.  A doubling of damages was sought.

Held

Jurisdiction of New Zealand courts to enforce foreign registered patent

(1)   The Court was persuaded that in this case the New Zealand court should have jurisdiction to determine any action for infringement of the US patent.  There was a trend towards the international enforcement of foreign intellectual property rights being appropriate where the validity of those rights was not challenged.  No issue of validity of the US patent was raised in the present case and the evidence satisfied the Court that the patent had been validly granted, was in force and had been breached by the defendant. [14], [18] and [19]

(2)   Had the defendant taken some steps in the proceeding and raised the issue of validity of the US patent, there might have been an arguable case for the Court declining jurisdiction in favour of a court in the granting jurisdiction.  That was not the case however.  The defendant had taken no such step, so no issue of forum non-conveniens arose.  [18]

Relief

(3)   With respect to the plaintiff’s claim for an increase of damages based on US patent law principles, the measure or quantification of damages was generally regarded as a question of procedure governed by the law of the forum (lex fori) rather than the lex causae.  It was therefore New Zealand law which should govern the quantification of damages.  Given that the increase in damages sought by the plaintiff was not a recognised remedy in New Zealand, the Court was unable to grant the increased damages sought.  [23]

Alleged breach of the California Business Code

(4)   There was no established basis on which the Court could grant relief for breaches of a California statute.  [24]