General overheads – can any deduction be made
14.There were a number of issues in relation to Nuby’s general overheads. The first issue was whether Nuby is entitled in principle to make any deduction at all in relation to its general overheads. In this regard, it was common ground that, to be so entitled, Nuby must establish that, if it had not imported and sold the infringing Nuby Baby Baths, it would have incurred the same overheads in relation to the sale of non-infringing products. 15.Mr Hicks submitted that Nuby could not discharge this burden. He pointed to a number of emails which Nuby had sent in March 2018 to two potential suppliers of baby baths (Dongguan Babycare Products, trading as Super Shapes (“Super Shape”) and Jieyang Defa Industry Co. (“Defa”)). In these emails, Nuby stated that Amazon was insisting on being supplied with a bath that was, effectively, the same as the registered designs. On this basis, Mr Hicks argued, any product supplied by Nuby would have infringed. He also noted that Nuby had failed to adduce evidence from any of its then employees (such as Ms Burnell, Ms Oliveras or Ms Reed) who might have been able to give evidence as to what Amazon’s position had truly been in this regard or, indeed, evidence from Amazon itself. He also noted that Mr Dolan had said, in cross examination, that if the issue had been raised with Amazon, it is possible that Amazon would have put the supply of an alternative design out to tender. Finally, Mr Hicks argued that the fact that Nuby had continued to sell the infringing product to Amazon after receiving Bei Yu’s initial complaint showed that it and Amazon were wedded to that product.16.Notwithstanding these submissions, for the reasons set out below, on the balance of probabilities, I find that if Nuby had not dealt with the infringing Nuby Baby Bath, it would have dealt with another non-infringing product and, therefore, that it is entitled in principle to make a deduction in respect of its general overheads. 17.First, Mr Dolan was at the initial meeting with Amazon in Cologne (between 14th and 17th September 2017) and he was copied into Amazon’s email of 19th September in which they invited Nuby to “follow up on the ‘Tippitoes’ opportunity” (the ‘Tippitoes’ product being one made according to the registered designs). Whilst I accept that Mr Dolan did not play a leading role in the discussions, his understanding was that Amazon was merely seeking something similar. Amazon was not making, he said, “a specific request to have an exact replacement for the Tippitoes product”.18.Second, the way in which Nuby initially went about sourcing a product to meet Amazon’s request supports Mr Dolan’s understanding. In its email to Super Shapes on 19 September 2017, Nuby expressly stated that it was looking for a product “similar” to one shown in an image, it then referred to other products that “look similar”, namely items BB3048, BB3035, BB3045 and BB3046. I do not think that I can conclude that a product that “looks similar” means that that product would satisfy the test for infringement (i.e. that it would produce in the mind of the informed user the same overall impression as the registered design). Indeed, the other products referred to by Nuby appear different (sometimes significantly different) in both size and shape to the registered design (and to the Tippitoes product). Then, in a later email of 21 September 2017, Nuby asked Super Shapes for samples not only of item BB3047 (which appears to be effectively the same as the registered design) but also of item BB3048 (which is not). Similarly, in an email to Defa on 2 October 2017, Nuby not only sought a price for a product (item N1033) that was effectively the same as the Tippitoes product, but also for other baby baths (items N1035 and N1038) that were of a different design and size.19.Third, whilst on 5 October 2017, Nuby told Super Shapes that it was very interested in the BB3047, there was no suggestion that this was because Amazon was insisting on that precise design. Moreover, in this email, Nuby asked Super Shapes whether there was a patent on that product. In this regard, I accept Mr St Quintin’s submissions that this was really a query as to the existence of some form of intellectual property in the BB3047 design and that it was only after it was informed on 9 October that there was no patent, that Nuby committed itself to that design. In my judgment, it is probable that, if the answer had been different, Nuby would have reverted to one of the other different designs of bath that it had been considering.20.Fourth, whilst Nuby’s later emails did assert that Amazon was insisting on the design that turned out to be infringing, I accept Mr Tempest’s evidence that this was a negotiation tactic whereby Nuby sought to obtain better terms from its suppliers. In particular, the email of 8 March 2018 from Ms Burnell to Super Shapes seems to me to be so confused and inconsistent that it is difficult to place any other interpretation on it.21.Fifth, given that Nuby was (on Mr Dolan’s evidence) looking to move into larger types of infant products, that it had identified a clear opportunity to supply a baby bath and that there were plenty of designs for baby baths readily available on the market (whether from Super Shape or Defa or from the other suppliers named by Mr Tempest, such as Bena, Bronco Baby or Do it Baby), it is probable that, if Nuby had not supplied the infringing products, it would have supplied non-infringing products instead. As Mr St Quintin pointed out, Nuby’s evidence suggests that it has a constantly changing portfolio of products (with more than 60 new products a year), so the adoption of a different design would have presented no difficulties.22.Sixth, whilst (apart from Mr Dolan’s evidence) there was no direct evidence as to Amazon’s intentions, it is difficult to see why Amazon would have insisted on Nuby supplying it with an exact replica of the Tippitoes product or, if it was not possible for Nuby to supply an exact replica, why Amazon would have decided to put the supply of an alternative product out to tender. Amazon’s email shows that it wished to work with Nuby as a “NPD” (new product designer) and it seems to me, on the balance of probabilities, that it would have agreed for Nuby to supply it with something similar (but non-infringing). Indeed, that is exactly what happened in 2021 when Nuby withdrew the infringing Nuby Baby Bath and started supplying Amazon and all but two of its other customers with a different design of bath. I do not accept Mr Hicks’ suggestion that this only happened because Nuby had been able to build on a relationship with Amazon over the three years that it had supplied Amazon with the Nuby Baby Bath. It seems much more likely that it happened because Amazon (and Nuby’s other customers) did not require an exact replica of the Tippitoes product. 23.Finally, in response to what Mr Hicks admits is a small point, I cannot see that the fact that Nuby continued selling the Nuby Baby Bath for two or three years after Bei Yu’s first complaint really suggests that Nuby (and Amazon) were so wedded to that design that no other design would have been acceptable. Quite apart from the various reasons why Nuby might have thought that it had a defence to an infringement claim, the fact is that a different design was subsequently supplied.