F. SUMMARY AND FORM OF ORDER
100.I will make the following declarations sought in the pleadings (but will hear submissions about the specific wording):i)Pixdene is entitled to choose a third party auditor to carry out each audit under clause 5, who must be an entity that is distinct from and independent of either party (save for being instructed by Pixdene) and with no commercial interest in the outcome of the audit;ii)Pixdene must give Paddington prior written notice of an audit under Clause 5 which must be given a reasonable time (which shall not be less than 10 clear business days) before the proposed audit and must identify the relevant period for the audit inspection;iii)An audit under clause 5 may involve a period of more than two years, however there cannot be more than one audit per two year period and there cannot be an audit inspection in respect of a period that has already been the subject of an audit inspection pursuant to clause 5; iv)An audit inspection must take place at a venue to be reasonably determined by Paddington within Paddington’s control and within normal working hours;v)Paddington shall be obliged to make such copies of the inspected documents as the third party auditor reasonably requests, and to permit the third party auditor to take copies himself, provided that the cost of such copies is met by Pixdene and that the third party auditor keeps such copies confidential;vi)Pixdene is not entitled to inspect documents pursuant to clause 5 or, to be provided with copies of the same by Paddington;vii)The third party auditor is only permitted to disclose to Pixdene such information gained from the audit inspection as is necessary to report on the following matters, and shall keep all other information confidential:a)the conclusion reached on the audit (i.e. whether or not Paddington has complied with its obligations under the RDA); b)the basis of that conclusion, and if an underpayment is found; c)what further sums are due from Paddington; and d)the basis of calculation of such sums; viii)Paddington is only entitled to redact documents for inspection to the extent that they are legally privileged;ix)The Requested Documents set out in Part A and at paragraph 9 of Part B of the Amended Appendix 1 to the Amended Particulars of Claim are agreements or other business records within the scope of Clause 5101.I will hear submissions about the form of order, including the scope and wording of declarations sought, at the handing down of the judgment on 2 November 2022.
- Paddington
- Pixdene
- Copyrights
- Agent
- During the term of this Agreement a third party auditor may, upon prior written notice to Paddington and not more than once per every two year period, inspect the agreements and any other business records of Paddington with respect to the relevant records or associated matters during normal working hours to verify Paddington’s compliance with this Agreement.”
- Third Audit
- THE ISSUES
- the CMC
- Part B Requested Documents
- Contractual construction
- The implication of terms
- D. THE RDA
- E. DETERMINATION OF ISSUES
- Who can inspect?
- Issue 2(a) – Does clause 5 require Paddington to provide Pixdene with copies of inspected documents?
- Issue 4 – Is an audit inspection under clause 5 limited to a physical on-site inspection of documents in Paddington’s offices, during normal working hours?
- in order to
- to report
- limited disclosure right
- Issue 2(b) – Does clause 5 require Paddington to provide the third party auditor with copies of inspected documents?
- Copyrights Agreement
- and not more than once per every two year period
- Issue 7 – To what extent is Paddington entitled to redact documents seen by (a) the third party auditor; (b) Suttons Solicitors [who act for Pixdene] and any other professional advisors of Pixdene and (c) Pixdene?
- F. SUMMARY AND FORM OF ORDER
