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The recent case of Henderson v All Around the World Recordings Ltd & Anor [2013] EWPCC 19 reaffirmed that After the Event (‘ATE’) insurance premiums and CFA success fees fall within the Patents County Court (‘PCC’) costs cap. In very exceptional cases, the costs cap can be dis-applied; however this only occurs in the most exceptional of circumstances in order to provide costs certainty to the parties.

Within the Judgment, His Honour Judge Birss QC highlighted that whilst the outcome of the case was unknown, the claimant relied on the PCC in order to limit the adverse costs risk to £50,000. However, once the claimant’s case was successful, she then sought to override the cap in order to recover further sums from the losing party.

In cases such as this, where hindsight is a wonderful thing, a claimant may be torn between 1) benefitting from the adverse costs protection in the event of a loss; and 2) being able to recover over and above the cap in the event of a win.

However, this claimant quandary can be resolved by litigation in the High Court, rather than the PCC, and using ATE insurance and/or litigation funding to reduce the risk to the client.

By litigation in the High Court where there is no costs cap, a successful claimant can recover increased sums. The downside risk associated with the High Court litigation can be reduced or even removed entirely by using ATE insurance to cover adverse costs, own disbursements and potentially a proportion of own fees too.

As Birss J affirmed in his Judgment:

::quote “A litigant who wishes to recover a reasonable proportion of the totality of his or her legal costs has a clear option available, to litigate in the High Court.”

To find out more about the funding and insurance options available to both litigants pursuing a claim in the High Court and in the PCC, speak to one of our advisors by calling us on 0845 257 6058.