Court of Appeal dismisses appeal against finding of contempt arising from failure to comply with Island Records order

In Cartier International AG v Dynasty Jewelery (Hong Kong) Ltd [2023] HKCA 1002, the Court of Appeal dismissed the defendants’ appeal against the judgment by Mimmie Chan J (“Judge”), whereby the defendants were held to be guilty of contempt of court for failing to properly disclose their dealings of the counterfeit products.

As is typical in intellectual property proceedings, a defendant, if found to have infringed the IP rights of a plaintiff, is required to disclose (i) the supply of counterfeit products to it (akin to Norwich Pharmacal Order except it is not an innocent party) and (ii) its subsequent sale thereof to any third party (Island Records disclosure). On appeal against the Judge’s decision, the defendants criticised the Judge that she had failed to consider their statements regarding the other customers might well be mere sales talk.

The Court of Appeal rejected such criticism as there was no evidential basis laid before the Court. This is since the defendants had (i) failed to put forward any such evidence, (ii) elected not to rely on their affirmations made in the contempt proceedings, and (iii) not offered themselves for cross-examination.

William Tse (led by Philips B F Wong), instructed by Robin Bridge & John Liu, represented the plaintiffs.