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Damages decision made by IPEC in copyright case

Written by Ellis Sweetenham on 17 September 2015

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Absolute Lofts South Wets London Ltd v Artisan Home Improvements Ltd and another [2015] EWHC 2608 (IPEC)

Facts:

Absolute Lofts is in the business of loft conversions providing its services in the London area.

Upon completion of a loft conversion and with the agreement of the house owner, photographs of the work done are taken to put on Absolute Lofts' website. Sometimes editing software is used to improve the quality of the image.

Copyright subsists in each of these photographs and the copyrights are owned by Absolute Lofts. In the case of photographs which have been edited, Absolute Lofts relies separately on copyright in the original photo and in the enhanced version.

The First Defendant (“Artisan”) provides home improvement services in and around Bradford. The Second Defendant (“Mr Ludbrook”) is a director of Artisan and owns all the shares of the company.

In 2009 Mr Ludbrook expanded into the loft conversion market and decided to use Artisan, for the first time, as the vehicle for his new business. Artisan began trading in January 2010.

 In February 2010, a loft conversion website for Artisan was created for £400. Artisan's website went live in about September 2010. Over the next three and half years the business grew, with a turnover of £498,000 for the year ended 2013.

In May 2014 Artisan received Absolute Lofts' letter before action dated 7 May. It complained of the use by Artisan in its website of 21 images taken from Absolute Lofts' website. These were all images of loft conversions done by Absolute Lofts.

Artisan website was shut down in May 2014 by Mr Ludbrook. The images complained of were removed and replaced by 21 licensed images of loft conversions done by unidentified parties purchased by Mr Ludbrook from a stock photograph library. The website went live again and business was continued for a while until Artisan went into liquidation in April 2015.

These proceedings were started and Mr Ludbrook admits that Artisan infringed Absolute Lofts' copyrights and he accepts joint liability for those infringements.

Issues:

The first is the quantum of compensatory damages due to Absolute Lofts. The parties are agreed that this is to be assessed on the 'user principle'.

The second is whether Absolute Lofts is entitled to additional damages pursuant to s.97(2) of the Copyright, Designs and Patents Act 1988 (“the 1988 Act”) and if so, how much.

Failing that, Absolute Lofts makes a claim under art.13(1) of Directive 2004/48/EC on the enforcement of intellectual property rights (“the Enforcement Directive”).

Judgment:

An award of £300 was made to Absolute Lofts as compensatory damages for the use of the copyright protected photographs. This amount was decided using the amount Mr Ludbrook paid for the second selection of photographs for his website after the copyright protected photographs were removed as a guide.

In addition, the court found that Mr Ludbrook either knew that the copies of Absolute Lofts' photographs on Artisan's website were infringing copies or alternatively that he had reasonable grounds to know they were. This is sufficient to engage both s.97(2) of the 1988 Act and art.13(1) of the Enforcement Directive.

Following this, an award of additional damages under s.97(2) and an award of unfair profits under art.13(1) are not cumulative so in addition to the £300 outlined above , the defendants must further pay Absolute Lofts the sum of £6,000.

If you'd like to know more about this article please send an email to Ellis Sweetenham quoting the article title and any questions you might have, alternatively call the office number on 02380 235 979 or send an enquiry through our contact form.

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