Court of Appeal rules on the scope of damages claims for derived products

The Court of Appeal recently ruled that a successful claimant can seek damages arising from the manufacture and sale of derived products.  In the long running litigation of Vestergaard Frandsen A/S The Court of Appeal recently ruled that a successful claimant can seek damages arising from the manufacture and sale of derived products.  In the long running litigation of Vestergaard Frandsen A/S (now called MVF3 ApS) & Ors v. Bestnet Europe Ltd & Ors the case is proceeding to an Inquiry into Damages in the early part of 2014.  The case concerns the misuse of trade secrets used in the manufacture of long-lasting insecticidal mosquito nets ("LLINs").  At trial Mr Justice Arnold held that the first version of Bestnet's NetProtect product which was launched in October 2005 incorporated VF's trade secrets and granted an injunction against this version.  However, he held that Bestnet then made changes to the formulation of their product and, having designed away from the original version, the later variants were derived from the misuse of VF's confidential information and he held that the appropriate remedy for past misuse should be a financial one.

The Defendants recently challenged this, seeking to strike out any claim for damages relating to derived products.  However, the Court of Appeal has held that both classes of product (i.e. the product which misused the confidential information, and later products which are derived from the misuse of confidential information) benefit from the Claimant's confidential information and an assessment can only be made when the facts have been established at the trial of the Inquiry.

Click here for a more detailed discussion of the decision, as published on www.ffw.com