The applicable law
5.There was little, if any, difference between the parties as regards the principles of law to be applied in relation to the claim for an account of profits on the facts of this case. I would summarise the relevant principles as follows:a.The purpose of the account of profits is to deprive Nuby of the profits which it has improperly made by its wrongful importation and sale of the Nuby Baby Bath and to transfer those profits to Bei Yu – see Hotel Cipriani v Cipriani Grosvenor Street [2010] EWHC 628 (Ch) per Briggs J at [8]. In this regard, it is Nuby’s actual profit that the court has to identify rather than the profit that Nuby could or ought to have made. In effect, Bei Yu must take Nuby (and its profit) as it is – see Jack Wills Ltd v House of Fraser (Stores) Ltd [2016] EWHC 626 (Ch), at [10]).b.The relevant profits are the sum left after deducting Nuby’s allowable expenses from the sums received or receivable by Nuby in respect of its infringing acts.c.The allowable expenses will include any costs that were associated solely with Nuby’s infringing acts. Those costs might be direct costs (e.g. the costs of purchasing and importing the relevant products) or any increased overheads specifically related to the infringing acts. Such expenses may be deducted in their entirety – see OOO Abbott v Design and Display Ltd [2017] EWHC 932 (IPEC), per HHJ Hacon at [57(1) and (2)].d.The allowable expenses can also include a proportion of Nuby’s general overheads unless (a) the relevant overhead would have been incurred anyway (i.e. it would have been incurred even if the infringing acts had not occurred) and (b) the sale of infringing products would not have been replaced by the sale of non-infringing products – see OOO Abbott per HHJ Hacon at [57(3)].e.Where a deduction can be made in respect of a general overhead, the amount deducted is such proportion of the overhead figure that can fairly be attributed to Nuby’s infringing activities as opposed to its non-infringing activities. This apportionment is done on a broad brush basis - see Jack Wills at [53].1 However, it may be appropriate to use different bases of apportionment for different types of overhead. A basis that is fair and appropriate in relation to, for example, an expense relating to the business premises may not be fair and appropriate when applied to, say, wages - see Jack Wills at [53]. As noted by Lewison LJ in OOO Abbott [2016] EWCA Civ 95 at [39], the question posed by the court as regards deductible overheads is a relatively simple one to ask, even if it may not be easy to answer.f.The evidential burden rests on Nuby to support a claim that it is appropriate to make a deduction on account of a sum said to be an allowable expense under the principles set out in (b) to (e) above – see OOO Abbott [2017] EWHC 932 (IPEC) at [57(4)].