A successful defense against a copyright troll - loser pays

Posted Apr 30, 2018 9:34 UTC (Mon) by farnz (subscriber, #17727)
In reply to: A successful defense against a copyright troll - loser pays by mpr22
Parent article: A successful defense against a copyright troll

Also in the UK, the rule of thumb (consult a real lawyer, not a software developer if you want the gory details) is that you must first make an offer to settle the case before you are eligible for a costs award; costs are then limited to "reasonable"[1] costs incurred after the settlement offer was rejected, and are only normally awarded if the court makes a more generous award than the settlement offer represented. Further, we permit so-called "conditional fee arrangements" (CFAs), where the lawyers agree a nominal fee to represent you, but get their fees paid if they win (from a costs award, if there is one, or from your award if there is no costs award). CFAs have limits (generally, that they cannot recover from your award if there is a costs award, and cannot recover more than a fixed percentage of any award), so that you are never in the situation where the lawyers are the only winners.

This, in turn, means that our rules of civil procedure require both parties to start out by making settlement offers; fail to do so, and all costs incurred before that point are not recoverable. For the case given, of a rich guy hiring lawyers on the chance of a surprise success, you hit two issues:

The poor guy can set up a CFA that means that he gets good representation too. It's thus not a "great lawyers versus poor guy" situation, but "great lawyers versus great lawyers" situation.
The poor guy can make a settlement offer that limits his risk; fees after the settlement offer is rejected can be safely ignored by the poor guy, as the rich guy has to pay them anyway.

Also, don't forget that a single case in civil court is not a straight win/lose proposition. Let's say (for the sake of argument) that the case is about an insecure device leaking information; the plaintiff (poor guy) wants a full refund on the device (not fit for purpose), and compensation for the data leak (GDPR, soon). You can make a settlement offer that consists of "full refund, legal fees to this point, plus a written apology for the data leak", and thus block off any arguments over the data leak part of the award; if the court awards a full refund for the product (the bit that's not grey), then legal fees cannot be awarded to rich guy - he could have settled at the point the settlement was offered, and chose to litigate anyway.

[1] Reasonable is defined in terms of market rates, and in terms of the reasons given for rejection; in general, you are expected to bring all your reasons for rejecting a given settlement offer before the judge, as they should all be grey areas that need the court to rule on the case, and not things that you already know. The fewer reasons you litigate in court having rejected a settlement, the higher the definition of "reasonable" on the part of your opponent's lawyers.