Legal saga nears end

The latest instalment of Ultraframe vs. Burnden Group and K2 Conservatory Roof Systems Limited is a judgment on costs in Burnden’s favour.

Ultraframe has been ordered to pay a sum in the region of £5 million, and has until December to appeal, in which case it has to make an interim payment of £2 million. After six years of litigation, it is perhaps unlikely to be overturned.

In July Ultraframe claimed a victory with its £500,000 award for intellectual property (IP) rights. Still to come is a court enquiry to decide a sum to Ultraframe for the period 31/12/04 to the present, and to negotiate a licence of right with Northstar and Seaquest. (Ultraframe was declared the owner of the shares in both Northstar and Seaquest in 2000. Gary Fielding, a shareholder and director of Burnden had contested this, claiming he was the majority shareholder following a series of transactions with Howard Davies of the Quickfit Companies).

Burnden’s 2003 offer seems to have worked as mitigating action: The ‘global offer’ made by Burnden in December 2003 of a payment to Northstar and Seaquest of £500,000 and a waiver by Mr Fielding of his claims as a creditor, worth just under £400,000.

Looking ahead, only a handful of the disputed patents are used in K2’s current roof systems.

Burnden statement excerpts:

Awarding costs following a six month trial, Mr Justice Lewison ruled that Clitheroe-based Ultraframe Plc should pay the bulk of the costs incurred by the defendants The Burnden Group and K2 Conservatory Roof Systems Limited.

Ultraframe was instructed to pay £2 million as an interim payment with the full costs likely to increase to approximately £5 million.

Details of the award are as follows: Ultraframe has been ordered to pay varying proportions of the costs of different parts of the litigation; most importantly this includes 75% of the costs of the main actions after January 2004 (which period included the 6 month trial in the High Court) and 80% of the costs of the earlier action for design right infringement.  Ultraframe were also ordered to pay interest on those costs at 1% over base rate.

Burnden’s costs incurred to date (excluding interest) are estimated at £6.7 million.  These costs will be formally assessed before a final figure can be reached. Ultraframe is to be paid no money as a result of the judgement.  The favourable rulings relate to IP owned by two companies in liquidation, Northstar and Seaquest.  As Gary Fielding is a major creditor of these companies the court held that the net effect of the positive rulings is simply to reduce their overall liability to him.

Ultraframe statement excerpts:

The High Court has now ruled on costs and permission to appeal.

In July the Court ruled that the overwhelming majority of the Intellectual Property Rights (IPR) in the disputed roofing system belong to Northstar and Seaquest and ultimately therefore the Ultraframe Group.  Burnden is liable to pay licence fees in respect of past use and has been obliged to undertake to the Court to take a licence from Northstar and Seaquest relating to any future infringing use of the IPR. 

The Court has now announced that there will be an inquiry into the damages that Burnden is liable to pay for its design right infringements.

As a result of Fielding having made earlier confidential settlement offers, the court decided to award Burnden Group some element of their costs.

Ultraframe is now considering an application to the Court of Appeal. An application must be lodged by December 2005, with an appeal verdict expected during 2006.