Anton Pillar Orders, Search Orders

INTELLECTUAL PROPERTY

"[Search Orders] have gone too far and have become inequitable remedies…They should be granted rarely, and only in extreme cases where there is a grave danger of destruction of evidence."

Discuss.

ABSTRACT
Anton Piller orders were initially treated very carefully only to be used where 'the ends of justice would otherwise be defeated'. The Subjective nature of their applicability extended their application. It seemed that Anton Piller orders were used indiscriminately, with not enough regard to the rights of the defendants. However further decisions and directives have added further requirements and conditions that should be met in order to redress the balance between the plaintiff and defendant. The introduction of these requirements then leave the question, has the balance been shifted too far?

Search and seizure orders, previously known as Anton Piller orders have had a short yet quite distinguished history. The product of their namesake, Anton Piller1 K.G. v Manufacturing Processes Ltd , Anton Piller (AP) orders were recognised by the Court of Appeal as a Judicial tool that allowed evidence to be seized and secured, pending a hearing. This provided an 'equitable' remedy in cases of copyright infringement and 'piracy', where before, there was no remedy for the owners of the copyright. The important reservation however was that there must have been a 'real possibility of destruction' of the evidence concerned. In Anton Piller, it was clearly distinguished that the order was not a 'search warrant'. It is a long established principle2 of the law that 'no court in this land has any power to issue a search warrant to enter a man's house so as to see if there are papers or documents there'3 . Denning ruled that these orders only 'authorises entry and inspection by the permission of the defendants'. However, failing to give permission to the search would put the defendant in contempt of court. 'This may seem to be a search warrant in disguise'.

In order to assess whether AP orders have become an inequitable remedy, they should be looked at in an historical context. There have been a number of developments to AP orders which have sought to address the balance of equity. Traditionally AP orders were seen as being inequitable for the defendant and were viewed very cautiously. The significant issue in terms of equity was that they were granted ex parte, effecting the 'liberty' of the individual or organisation concerned without there being an opportunity for the defendant to be heard in Court. This of course is crucial to the successful operation of the orders, 'If the stable door cannot be bolted, the horse must be secured.. If the horse is liable to be spirited away, notice of an intention to secure the horse will defeat the intention'4 . If the defendant knew that he was to be subject to an AP order, he would have the opportunity to destroy the evidence before the search could take place. In order to redress this balance, Lord Justice Ormrod5 set down a number of conditions that were required to be demonstrated by the Plaintiffs before such an order could be granted; 'First, there must be an extremely strong prima facie case. Secondly, the damage, potential or actual, must be very serious for the applicant. Thirdly, there must be clear evidence that the defendants have in their possession incriminating documents or things, and that there is a real possibility that they may destroy such material before any application inter partes can be made.'6 Lord Denning MR added the further requirements that the inspection would do no harm to the defendants and the defendant would be advised of his right to seek legal advice before consenting to the search order. Clearly by the words used in Anton Piller; 'extremely strong' case, damage be 'very serious' and 'clear evidence' of incriminating documents, showed that the intention was that this order should only be granted where absolutely necessary, 'where the ends of justice would otherwise be defeated'7. This cautious view was upheld by the Court of Appeal following previous dicta that such orders were 'an unusual order which will only be made in unusual circumstances'.8

These orders seemed hugely successful however and far from being used rarely in unusual circumstances, their use was 'the norm' being applied by the courts on a daily basis. With the growth in the area of Intellectual Property, the disputes in which their use was confined has also extended from their origins of pure infringement of copyright. Their use had extended to as far as 'bootlegging'9 which was a criminal offence. It was also extended to seize 'non industrial property' in Yousif v Salama10. The 'search warrant in disguise' seemed unstoppable in its universal application. This was clearly a result of the subjective nature in which the judge in each case would determine whether the case before him fitted into the guidelines for allowing AP orders. Resulting in 'a series of ad hoc extensions, and .. a clear manifestation .. of judicial discomfort at the speed and extent of some of these developments'11. It would seem proper to conclude that the initial caution caused by the recognition of inequity had dissipated due to the usefulness of such orders. Clearly with the increase in application, the remedy was becoming more inequitable. The initial controls12 that were advocated by Ormrod and Denning now seem to have been lost in a frenzy of popularity. With anything that increases in magnitude, careful checks and balances are made more difficult. The balance of power at this point seemed very much in favour of the plaintiffs. With the increased use of the AP orders, we saw an increase in problems associated with the execution of the orders. This came to a notice in the case of Columbia Picture Industries Inc v Robinson 13. In this case there were a number of factors that had taken place during the execution of the search order that raised concern. It was found that material had been taken that was not covered by the order itself. No lists were made of what was taken in the execution of the order. Materials that were taken, especially those that were not in relation to the order were not returned quickly. Finally, a number of materials were lost while in the custody of the executing solicitor. Scott J, referred to the execution of the order as, 'an oppressive and flagrant disregard to the defendant's rights' 14. This case demonstrated how AP orders were open to abuse, although the defendant was awarded £10,000 in exemplary damages, it demonstrated how such orders could result 'unequitably' for the defendant. In order to address this problem, Columbia added some extra requirements particularly in relation to the seizure of materials; once it has been made clear what evidence exits, after copies have been made, the materials should be returned to the defendant within a reasonable time period; detailed records of what was taken should be made before any material is removed. Scott J also addressed the widespread use of such orders, 'what I have heard in the present case has disposed me to think that the practice of the court has allowed the balance to swing much too far in favour of the plaintiffs and that Anton Piller orders have been too readily granted and with insufficient safeguards'15 . Later in the case of Lock International plc v Beswick16the concern expressed was noted and an AP order was refused, Hoffman J stating that their use, 'can only be done where there is a paramount need to prevent a denial of justice to the plaintiffs'17 . Some years later in the case of Universal Thermosensors Ltd v Hibben & Others 18an execution of an AP order was again 'flawed'. In her paper19Fiona Russell evaluates the impact of the case whereby the executing solicitor in an out of court settlement agreed to pay £34,000 in damages, 'the improprieties must have therefore been substantial' 20. This case proved that some further controls were required to redress the balance of equity. In giving his judgement, the Vice Chancellor made a number of recommendations that should be followed when executing AP orders. He first stated that when AP orders are executed outside of business hours, the availability of legal advice for the defendant is limited. As the availability of legal advice was considered crucial in distinguishing AP orders from search warrants, allowing the defendant to make an informed consent to search; should such orders be executed when such legal advice may be unavailable? Russell argues that to place such a restriction would create 'some cases where it would be impossible to levy execution'. She suggests that 'at the very least, it must be right, and in the plaintiffs interests to allow execution before or after business hours on giving a full explanation of the circumstances and the necessity for allowing execution at such times' 21. Furthermore, it was suggested by the Vice Chancellor that where an execution of an AP order was to take place in a private house, where there was a possibility that there might be a woman on her own, the AP order should be served either by a woman or accompanied by a woman. This addresses specific fears that were raised by Scott J in Columbia, that execution of AP orders 'are likely to cause shock, distress and often outrage to those against whom the orders are executed' 22. However it is argued that this would result in problems in ascertaining whether or not a woman would be alone, 'is it going to be necessary, where execution is on a private house, to ensure that a woman is always present?'. Further requirements are also recommended; that there should always be a list of what is taken; an officer of the defendant's business should be present on execution of the order; where the plaintiff is in competition with the defendant, they should not be able to take part in the search for fear of obtaining unfair inside information, and the executing solicitor should be independent of the plaintiff. Clearly, these attempts to restore the balance of equity that was once, arguably too far in favour of the plaintiff would be a good thing. However, Russell argues that this is too far and will 'substantially increase costs for the already beleaguered plaintiff'. However the Vice Chancellor argues that, 'if the plaintiffs wish to take advantage of the Draconian anton piller order, then they must be prepared to pay for safeguards that experience has shown to be necessary'23 . So it is fair to impose such a duty on the plaintiff, who need an appropriate remedy against those who would seek to destroy evidence? However in the view of some, this proved successful for all concerned. 'The Introduction of supervising solicitors for Anton Piller orders have proved an unqualified success. It has simplified the plaintiff's solicitor's role and it has helped to protect the defendant against excess'24 . It is also remarked in terms of cost, 'while it was feared that it would make the costs of Anton Piller orders prohibitive, in this writers' experience it has in fact brought the costs down.. defendants are generally readier to comply with the terms of the order'. The introduction of a 'supervising solicitor' was just one of the new limitations that were incorporated into the standard AP order following the practice directions of the Lord Chief Justice 25. In the practice directives, the motive was set down as follows, 'it is desirable that a consistent approach should in general be adopted in relation to the form and carrying out of such orders, since they represent serious restrictions on the rights of those persons subjected to them'. I think it is crucial to know look at the modern approach that is defined by these practice directions. It is required, 'in appropriate cases' for the plaintiff to support his cross-undertaking in damages, 'by a payment into court or the provision of a bond by an insurance company'. As previously shown, the execution of the order is required to be by a supervising solicitor, who should be 'an experienced solicitor, having some familiarity with the operation on Anton Piller Orders'. The order further limits this solicitor to those who are not members or employees of the firm acting for the applicant'. It is further directed that where premises subject to the search order are likely to be occupied by a 'unaccompanied woman', where the supervising solicitor is male, there must be a woman in attendance. Where appropriate, items that are too be removed should be insured by the applicant. 'The premises must not be searched, and items must not be removed from them, except in the presence of the defendant or a person appearing to be a responsible employee of the defendant.26 ' Further to the recommendations made by the Vice Chancellor in Universal Thermosensors, 'the order may only be served between 9.30an and 5.30pm on a weekday' 27; 'no item may be removed from the premises until a list of the items removed has been prepared , and a copy of the list has been supplied to the person served with the order, and he has been given a reasonable opportunity to check the list 28'. These practice directions have given the courts must needed guidance in issuing these orders and have an obviously strong effect on the equitable of the remedy. It seems that we should no longer see repeats of cases such as Columbia or Universal Thermosensors. However, do these extra requirements place too much of a burden on the plaintiff? As Russell argued in relation to the recommendation in Universal Thermosensors, 'it takes protection of the defendant even further, perhaps to the detriment or at least the disadvantage of all but the richest plaintiffs'. However, if the cost issue, is the only concern, we can see some evidence that these changes have made things cheaper.

I now wish to look at the Statutory impact on this area. One on the initial problems that caused plaintiffs some concern was the judgement in Rank Film Distributors Ltd v Video Information Centre 29. This was the first case where the actual validity of the orders had been challenged. It was held by the House of Lords that a defendant would not be required to answer questions or disclose any documents or materials where do so might be self-incrimination. However, this 'loophole' that had the potential of seriously undermining this remedy was quickly closed by the Supreme Court Act [1981] s.72 that required the disclosure of documentation in cases involving infringement of rights in Intellectual Property and passing off. This would appear to unfairly burden the defendant with self-incrimination. However, this was balanced by the fact that such information would not be admissible in proceedings for a related offence (albeit with some exceptions). Anton Piller orders are now covered by the Civil Procedure Act [1997] s.7. Although this legislation does not seem to impose any requirements on the execution or application of such an order, instead leaving the discretion with the court. Perhaps this was an opportunity missed to provide the courts with some clear authority on this issue. However, it would seem that the discretion given to the Judiciary is working well within the guidelines from the Lord Chancellor. This allows a quick decision to be made in cases on a factual basis, without the sometimes cumbersome strict requirements of substantive legislation. Another recent piece of legislation that will also have an increasing part in this issue is the Human Rights Act [1998]. The application of the Anton Piller orders must be seen as fair, otherwise there is the potential for conflict with 'the fundamental freedoms' that are established by the Convention on Human Rights.

Anton Piller orders were always seen as been inequitable remedies. The very fact that they are ordered ex parte, without the chance of the defendant to have his reply heard has a very important connotation for the defendant. In light of this traditional view, strong guidelines for their use were set down. The use of AP orders were to be restricted to only the very deserving and usual circumstances. However, as I have shown, their widespread daily use only demonstrated that too little regard was placed on these initial guidelines. Anton Piller orders at this stage in their development could only be described as extremely unequitable with the potential for widespread abuse. The cases of Columbia, Beswick and Universal Thermosensors recognised this and recommended additional controls to protect the defendant. However the major breakthrough in this area is obtained in the consistent guidelines from the Lord Chief Justice. The question is now, has the balance gone too far in favour of the defendant. Although, seeking an executing an AP order is now considerably more difficult for the plaintiff that in was in the past, I would suggest, as did the Vice Chancellor as the consequences and possibilities for the defendant are very severe, 'they must be prepared to pay' to prevent this. And I would conclude that the system is both workable and fair.

  1. [1976] Ch. 55 (Anton Piller)[^ Return]
  2. Entick v Carrington (1765) 2 Wils KB 275[^ Return]
  3. Lord Denning in Anton Piller[^ Return]
  4. Rank Film Distributors Ltd v Video Information Centre [1980] AC 380 at 418, taken from Modern Equity - Jill E Martin at 793[^ Return]
  5. Anton Piller[^ Return]
  6. Lord Ormrod in Anton Piller at p62[^ Return]
  7. Protection of Intellectual Property Rights: Anton Piller Orders - Anne Staines at 275[^ Return]
  8. E.M.I. v Pandit [1975] 1 WLR 302[^ Return]
  9. see Ex Parte Island Records Ltd [1978] Ch. 122[^ Return]
  10. [1980] 3 All ER 405[^ Return]
  11. Protection of Intellectual Property Rights: Anton Piller Orders - Anne Staines at 285[^ Return]
  12. in limiting the applications of the AP order[^ Return]
  13. [1986] 3 All ER 338[^ Return]
  14. ibid at p376[^ Return]
  15. ibid at p171[^ Return]
  16. [1989] 1 WLR 1268[^ Return]
  17. ibid, taken from Information: Protection, Ownership and Rights - Chandler & Holland (Blackstone Press) p18[^ Return]
  18. [1992] 3 All ER 257[^ Return]
  19. Anton Pillers after Universal Thermosensors: Has the Pendulum Swung too Far? ([1992] 7 EIPR 243)[^ Return]
  20. ibid at p244[^ Return]
  21. ibid [^ Return]
  22. Columbia p379[^ Return]
  23. Russell at p245[^ Return]
  24. The Mareva Injunction: A Cruel Tyranny? - Willoughby & Connal [1997] 8 EIPR 479 at p483[^ Return]
  25. [1994] 4 All ER 52[^ Return]
  26. The Law of Trusts and Equitable Obligations (2nd Edition) - Pearce & Stevens (Butterworths) p 69[^ Return]
  27. ibid p68[^ Return]
  28. ibid p69[^ Return]
  29. [1981] 2 WLR 668 [3,016][^ Return]

BIBLIOGRAPHY

Modern Equity (14th Edition) - Jill E Martin (Sweet & Maxwell)

The Principles of Equitable Remedies (3rd Edition) - I. C. F. Spry (Sweet & Maxwell)

Information: Protection, Ownership and Rights - Chandler & Holland (Blackstone Press)

The Law of Trusts and Equitable Obligations (2nd Edition) - Pearce & Stevens (Butterworths)

Equity and the Law of Trusts (7th Edition) - Phillip H Pettit (Butterworths)

Rank Film Distributors Ltd v Video Information Centre - Anne Staines ([1981] 44 Modern Law Review 580)

Protection of Intellectual Property Rights: Anton Piller Orders - Anne Staines ( [1983] 46 Modern Law Review 274)

Anton Pillers after Universal Thermosensors: Has the Pendulum Swung too Far? - Fiona Russell ([1992] 7 EIPR 243)

Has the Anton Piller Order become a Search Warrant? - Willoughby ([1994] 12 EIPR 550)

The Mareva Injunction: A Cruel Tyranny? - Willoughby & Connal [1997] 8 EIPR 479

Piller Problems - Dockray & Laddie [1990] 160 LQR 601

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