Original dispute forgotten, but the litigation lives on ...

The less cuddly side of litigation is plainly visible in WWF World Wide Fund for Nature v World Wrestling Federation Entertainment Inc [2007] EWCA Civ 286, a decision handed down on Monday by the Court of Appeal for England and Wales (Lords Justices Chadwick, Maurice Kay and Wilson). Available in full on BAILII, it's the latest in a long line of cases arising from the dispute between the Fund and the Federation over the right to control the use of the iconic letters WWF.

Right: beware, these animals litigate to the death

In short, the Fund was an internationally-known environmental protection and conservation charity with whom the initials WWF had long been associated. Following litigation against the Federation, which promoted and ran live wrestling events using the same initials, the parties agreed a compromise in 1994. This agreement did not give the Fund the exclusive right to use WWF but it contained substantial restrictions on how the Federation could use them. After the Federation breached the agreement, the Fund sued for breach of contract, seeking damages. An attempt to amend the claim so as to recover an account of profits was rejected. The claim was then tried on the basis that the Fund did not seek damages on the basis of Wrotham Park Estate Co Ltd v Parkside Homes Ltd [i.e. that the innocent party was entitled to claim as damages for breach of contract a reasonable payment in respect of the hypothetical release of the breach of contract].

After it obtained summary judgment, the Fund then sought damages on a Wrotham Park basis too. The matter came before Mr Justice Peter Smith who had to decide, as a preliminary issue, whether the Fund was allowed to do so. He noted that the account of profits claim had already been refused in the earlier proceedings, but indicated that that would have been no bar to permission for an amendment to raise the claim for an assessment of damages on the Wrotham Park basis.

Left: barristers - a protected species, much cherished by conservationists. There are not many left in the wild, but some breeding colonies still exist in captivity, in "chambers"

Mr Justice Peter Smith then determined that, in appropriate circumstances, a claimant might be entitled to Wrotham Park damages in respect of a breach of a restrictive covenant which had been brought to an end by the grant of an injunction. He did not, however, determine whether Fund was itself entitled to Wrotham Park damages in this case.

The Federation appealed, arguing that the Fund had already been refused permission to amend its claim to include a claim for one gains-based award - the account of profits - and that since Wrotham Park damages were juridically similar (both being gains-based), the Fund was precluded from raising the matter again by estoppel per rem judicatam.

The Court of Appeal allowed the Federation's appeal.

* The contention that a Wrotham Park award was not an award of compensatory damages but was to be characterised as a gains-based award was not made out - but that didn't matter. The real question was whether an order for an account of profits, in a case where the claim was based on breach of contract rather than on infringement of proprietary rights, was to be characterised as an award of compensatory damages. On that basis, Wrotham Park damages were indeed juridically highly similar to the relief of an account of profits.

* Both in the case of an account of profits and Wrotham Park damages the underlying feature was the need to compensate in circumstances where a claimant could not demonstrate identifiable financial loss. To label an award of Wrotham Park damages 'compensatory', in contrast with an order for an account of profits as being 'gains-based', did not assist an understanding of the principles on which the court acted. Both remedies should be seen as a flexible response to the need to compensate a claimant for the wrong suffered by him.

* In this case the first judge had decided that this was not one of those exceptional cases in which an order for an account of profits would be an appropriate remedy for breach of a contractual restriction. He did not however rule on whether the Fund's inability to quantify identifiable financial loss justified an award of Wrotham Park damages since that question had not been before him. The claim for an account of profits had however been put before him on the basis that a claim for Wrotham Park damages would not be pursued. This being so, the Fund was committing an abuse of process by seeking to raise a claim which it could and should have raised earlier, in conjunction with the claim to an account of profits.

The IPKat cringes at the complexity of the overlapping layers of compensatory measures offered by the courts in England and Wales and wonders whether the whole thing can't be reduced to a simple flow-chart (any volunteers?). Merpel says, some donors to the World Wide Fund for Nature must be wondering whether they're not just financing some very expensive and arguably unnecessary litigation. Most environmentalists and conservationalists are surely quite clever enough to spot whether WWF refers to the Fund or to a bunch of wrestlers - you don't get this kind of dispute where other well-known and well-established enterprises share initials. One example is Alcoholics Anonymous and the Automobile Association.

Some earlier rulings arising out of the WWF dispute here, here, here and here
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