Makeality Ltd v City Doggo Ltd: IPEC Appeal Dismissed

The Intellectual Property Enterprise Court (IPEC) has once again underlined the importance of proportionality in IP litigation. In a strongly worded ruling, Lord Justice Arnold dismissed an appeal in Makeality Ltd v City Doggo Ltd, confirming that a trade mark dispute over pet toilet training products belongs firmly in the IPEC Small Claims Track.

Makeality Ltd v City Doggo Ltd & Anor [2025] EWCA Civ 400 (11 April 2025)

The decision reinforces that even IP claims involving registered trade marks, allegations of passing off, and demands for enhanced damages must still be subject to proportionate cost control when the financial value and complexity are low.

It is also a valuable lesson for all practitioners to consider the level of damages before you embark on a costly IP case. Remember there is only one winner usually and that’s the lawyers!

Background: The “Piddle Patch” Dispute

Makeality Limited, owner of the UK trade mark for “Piddle Patch”, sued City Doggo Limited and its director, Ms. Laurencia Walker-Fooks, alleging infringement of its trade mark and passing off.

Makeality’s product — a biodegradable real grass litter box for pets — was promoted on BBC’s Dragons’ Den, generating substantial goodwill. The Defendants marketed a competing product under the brand “Oui Oui Patch” and were also accused of using the “Piddle Patch” name online.

The Claimant sought not only the usual remedies (injunctions, damages or an account of profits, interest and costs) but also additional damages for allegedly deliberate infringement, citing the Intellectual Property (Enforcement, etc.) Regulations 2006.

The Defendants denied liability, admitted only minor infringing acts, and undertook to cease any future use of the “Piddle Patch” sign. They further contended that the claim should be allocated to the IPEC Small Claims Track due to its modest value and straightforward nature.

Facts of the IPEC Infringement Case

The dispute between Makeality Ltd and City Doggo Ltd centers on allegations of trademark infringement regarding the “Piddle Patch” product. The claimant, Makeality, asserted that City Doggo’s “Oui Oui Patch” misled consumers and encroached upon its intellectual property rights. This case was heard within the Intellectual Property Enterprise Court, where the complexities of financial value and trade mark implications were scrutinized. High Court Judge HHJ Richard Hacon analyzed the claims, focusing on the appropriateness of the small claims track for resolution.

The Allocation Battle

The key procedural issue became:

1. Should the claim proceed in the IPEC multi-track (as Makeality argued)?
2. Or in the Small Claims Track (as City Doggo insisted)?

HHJ Hacon, an experienced IPEC judge, ordered that the claim be transferred to the Small Claims Track on 3 October. Makeality appealed, arguing that the case complexity, potential damages, and need for proper cost recovery demanded multi-track allocation.

Lord Justice Arnold disagreed, upholding the transfer.

Procedural History

A series of rulings marked the procedural history of this intellectual property dispute, establishing the legal landscape for both parties. Initially, the Intellectual Property Enterprise Court (IPEC) oversaw the claims related to trade mark infringement, with HHJ Richard Hacon presiding as a High Court Judge. Important preliminary hearings allowed the court to refine case management approaches, particularly regarding the small claims track. Throughout the proceedings, the issues surrounding enforcement directive applicability and retained EU law significantly influenced the direction and outcomes of the disputes at hand.

The Court Proceedings Reasoning: Proportionality is Paramount

Lord Justice Arnold delivered a detailed judgment, reminding parties that IP disputes must be proportionate to their size and complexity. His key reasons were:

1. Value of the Claim:Neither party provided robust financial evidence.
2. The Defendants suggested a total profit of around £4,000, possibly overstated.
3. Makeality failed to present evidence that potential damages exceeded £10,000.
4. Therefore, the judge was entitled to conclude the claim was worth less than £10,000.
5. Complexity of the Issues:Although both sides had pleaded the case elaborately (with multiple legal arguments), the essential issues were typical of small claims: trade mark infringement, passing off, and minor use disputes.
6. The judge rightly assessed that the matter could be tried in a single day.
7. Representation by Solicitors and Lawyers: The fact that both sides were legally represented did not make the case too complex for the Small Claims Track.
8. Representation is permitted — but costs recovery is restricted — in small claims by design.
9. Access to Justice and Cost-Proportionality:IPEC Small Claims exists to provide a low-cost forum for small IP disputes.
10. Legal costs shifting is deliberately limited to encourage affordable enforcement in legal proceedings.
11. No Fundamental Error in the First Instance Decision:Robust case management decisions are not lightly overturned on appeal.
12. HHJ Hacon had applied the correct tests and exercised his discretion properly.
13. Neither party provided robust financial evidence.
14. The Defendants suggested a total profit of around £4,000, possibly overstated.
15. Makeality failed to present evidence that potential damages exceeded £10,000.
16. Therefore, the judge was entitled to conclude the claim was worth less than £10,000.
17. Although both sides had pleaded the case elaborately (with multiple legal arguments), the essential issues were typical of small claims: trade mark infringement, passing off, and minor use disputes.
18. The judge rightly assessed that the matter could be tried in a single day.
19. The fact that both sides were legally represented did not make the case too complex for the Small Claims Track.
20. Representation is permitted — but costs recovery is restricted — in small claims by design.
21. IPEC Small Claims exists to provide a low-cost forum for small IP disputes.
22. Legal costs shifting is deliberately limited to encourage affordable enforcement.
23. Robust case management decisions are not lightly overturned on appeal.
24. HHJ Hacon had applied the correct tests and exercised his discretion properly.

Legal Framework

Intellectual property disputes hinge on established legal frameworks that delineate rights and responsibilities. In the case of Makeality Ltd v City Doggo Ltd, key legislation includes retained EU law, specifically around trade mark infringement and enforcement directives. The Intellectual Property Enterprise Court (IPEC) plays a crucial role in streamlining case management, particularly within small claims tracks. This structured approach aims to ensure equitable treatment, balancing the financial value of claims against the need for accessible legal representation for all parties involved.

The Costs Argument: Enforcement Directive No Help

A creative second ground of appeal argued that moving the case to the Small Claims Track breached Article 14 of the Enforcement Directive, which requires a successful party to recover a “significant and appropriate” part of their reasonable legal costs.

Lord Justice Arnold dismissed this too:

1. The Small Claims regime was justified as promoting low-cost access to justice.
2. United Video Properties v Telenet (CJEU) did not prevent fixed low-cost regimes where appropriate.
3. UK law after Brexit (via the Retained EU Law (Revocation and Reform) Act 2023) means Article 14 no longer has any direct effect in the UK.
4. Even before Brexit, the Small Claims Track approach had been accepted as compliant.

Thus, the inability to recover substantial legal costs in small IP claims is lawful and intentional.

Lessons for Claimant Litigants: Size Matters

This decision highlights several important points for IP claimants and their advisors:

1. Evidence of quantum matters early. If you argue a case is too big for small claims, you must show why — with real figures, not speculation.
2. Complexity is assessed objectively. Elaborate pleadings do not necessarily make a case unsuitable for small claims.
3. Legal representation is not determinative. Having lawyers does not automatically justify multi-track allocation.
4. Costs are a secondary factor. You cannot avoid small claims just because you want to recover full legal fees.
5. Focus on proportionate litigation. Pursuing an IP claim that costs more to litigate than it is worth risks being penalised — here, by being kept in the Small Claims Track.

Conclusion: Right Court, Right Size

The IPEC Small Claims Track exists precisely for disputes like Makeality v City Doggo — where brand rights matter to small businesses, but the sums at stake are modest, and procedural fairness can be preserved with simpler, cheaper hearings.

Lord Justice Arnold’s judgment reinforces that courts must protect access to justice and proportionality in IP cases, not just the interests of better-funded parties.

It is a reminder that in intellectual property litigation, scale and value matter — not just principle.

Michael.Coyle@lawdit.co.uk

07976724258

What is the background of the case Makeality Ltd v City Doggo Ltd?

The case Makeality Ltd v City Doggo Ltd revolves around a dispute involving intellectual property rights. Makeality Ltd claimed that City Doggo Ltd infringed upon its proprietary technology. The case highlights the complexities of IP law, emphasizing the importance of protecting innovative ideas in the rapidly evolving digital landscape.