Andrew Scott

Most companies are now aware of the value to their business of intellectual property (IP) and the various ways in which to protect those IP assets. However, protecting the asset is only half the story. Knowing how to enforce your IP rights, and how to do so quickly, is just as important. That is where search orders can come in very useful.

The Ocado Group are well aware of this fact. As has been widely reported, they have recently settled a long-running dispute with their former founder and a former employee in relation to the use of commercially sensitive and confidential information. It would appear that one of the factors driving the settlement was the well-timed use of a search order. This from the Ocado website regarding the settlement:-

“This litigation (which included a multi-site search order against the Defendants), and the outcome of the proceedings, demonstrates that Ocado Group will take the strongest possible action against any individuals or companies to protect its interests. In particular, it will not hesitate to take any steps necessary to protect its extremely valuable intellectual property and know-how.”

In this blog, I will look at:

• What are search orders
• What must be proved in order to obtain a search order
• The role of the Supervising Solicitor

I will then have a quick look at a recent case which highlights the need for care when applying for and executing a search order. A search order is only available from the courts of England and Wales. While similar remedies are available from the Scottish courts they are arguably not as effective as a search order.

What are search orders?

A search order requires a defendant to allow the claimant’s representatives to enter his premises and to search for, copy and remove documents or material. If a defendant fails to comply, he may be found in contempt of court. Given its draconian nature, an independent solicitor, called the Supervising Solicitor, is appointed by the court to supervise and report on the execution of the search order.

The purpose of a search order is to preserve evidence or property. They are generally applied for where the claimant believes that there is a risk the defendant will destroy the evidence and are commonly granted in support of intellectual property claims.

The search order must clearly identify the specific materials that may be removed.

What must be proved to obtain a search order?

The claimant must satisfy the following three criteria:

• An extremely strong prima facie case
• The defendant’s actions have resulted in very serious potential or actual damage to the claimant’s interests.
• Clear evidence that the material is in the defendant’s possession and there is a real possibility that the defendant may destroy or dispose of it before an application can be made on notice.

Applications for search orders are almost always made without notice. One of the important documents that must be filed with the application is a letter from the Supervising Solicitor certifying his willingness to act.

The role of the supervising solicitor

The Supervising Solicitor acts as an independent officer of the court and must be independent of both the claimant’s and the respondent’s solicitors and have experience of search orders. They are also required to give an undertaking to the court in the form set out in Practice Direction 25A.

The Supervising Solicitor ensures that the search order is executed in accordance with the order itself and the relevant Rules. Before entering the premises, the Supervising Solicitor must advise the defendant:

• Of his right to legal advice.
• Of his right to vary or discharge the order.
• That he may be entitled to avail himself of legal professional privilege and the privilege against self-incrimination.

The Supervising Solicitor must make a list of all the material removed and no material should be removed until the defendant has had a chance to check that list.

The Supervising Solicitor must prepare a report on the carrying out of the order This report must be served by the claimant’s solicitors on the defendant and filed with the court so that it is available to the court at the return date hearing.

Search order – a recent example

The execution of a search order requires careful planning. There are a number of safeguards for defendants and so it is important that the claimant’s solicitors participating in the search are aware of these and understand all that is required. A recent reported case demonstrates just what can go wrong.

In this case, the search order was made in support of a previously obtained worldwide freezing order. It stated that any of the “Listed Items” were to be delivered up to the claimant’s solicitors but that any items which were the subject of a dispute as to whether they were Listed Items must be handed over to the Supervising Solicitor for safe-keeping pending the resolution of the dispute or further order of the court.

After the search had taken place, the Third Defendant applied to remove the Supervising Solicitor and for delivery up by the claimant’s solicitors of documents removed during the search. The grounds on which the application was made were as follows:-

• The Supervising solicitor had allowed a trainee solicitor of the claimant’s solicitors to participate in the search, despite the fact that she was not one of the search party named in the search order, this being a breach of Practice Direction 25A and the undertaking given to the court by the supervising solicitor
• The supervising solicitor had allowed the claimant’s solicitors to remove items which he considered were “Listed Items”, despite objections from the third defendant’s solicitors, as he considered that there was no genuine dispute regarding the items.
• The supervising solicitor’s experience was questioned as was the fact that he had been approached by the claimant’s solicitor directly to act as supervising solicitor, having been appointed by the claimant’s solicitor in a number of previous actions.

The judge ordered that some of the items removed by the claimant’s solicitors should have been retained by the supervising solicitor on the basis that there was a genuine dispute over whether those items fell into the category of “Listed Items”.

However, while the judge differed from the supervising solicitor on that issue, that was not sufficient to call into question his suitability as a supervising solicitor. The decision to allow the trainee solicitor to participate in the search and the circumstances around his appointment did not demonstrate a lack of independence or constitute grounds for his removal. Indeed, the judge described some of the third defendant’s criticisms of the supervising solicitor as extravagant and unjustifiable.

Learning Points

We can see that a search order can be a very powerful weapon, particularly in cases where you are looking to enforce your intellectual property rights. However, they should only be used in appropriate cases where the not insignificant cost of obtaining such orders can be justified. It should also be remembered that if the search order is set aside, the claimant can be liable to the defendant in damages.

In order to avoid unnecessary and distracting challenges to the search order, extreme care is needed to ensure that the search is carried out in accordance with the terms of the search order and the relevant Rules and Practice Direction. In addition, if you anticipate the search will be particularly contentious, you might want to appoint the Supervising Solicitor via the Law Society in order to avoid any suggestion of a lack of independence on the part of the Supervising Solicitor.

Andrew Scott is a senior associate at Brodies LLP