Experience Hendrix LLC v PPX Enterprises Inc [2003] EWCA Civ 323; [2003] 1 All ER (Comm) 830
Facts
The D, PPX Enterprises Inc, granted licences which exploited the master recordings These recordings contained work from Jimi Hendrix, which was in breach of a prior agreement The C, Experience Hendrix LLC, did not have the evidence to show any financial losses suffered as a consequence of the breach The C sought damages for the breach of contract, they claimed a restitution of profits from the breach - citing the case of Attorney General v Blake [2000] The High Court ordered an injunction to avoid further breaches but did not award damages, so the C appealed
Legal Issue
Was the C entitled to more than an injunction, were they entitled to an account of profits for the D’s breaches?
Held
The Court of Appeal permitted a reasonable-sum award for the use of recordings in breach of the settlement agreement, but declined to order a full account of profits. The circumstances did not justify the exceptional profit-stripping remedy recognised in Attorney General v Blake. An injunction addressed future conduct but did not alone provide the appropriate financial response for past unauthorised use.
The proposed sum reflected what might reasonably have been negotiated for permission to grant the offending licences. Later authority has clarified that such negotiating damages are compensatory where the breach causes loss of a valuable right, not a general restitutionary alternative whenever ordinary financial loss is difficult to prove. The case must now be understood within that narrower explanation.
⭐ Legal Principle
Unauthorised use of a valuable contractual right may justify damages measured by a reasonable release or licence fee in appropriate circumstances. A full account of profits is exceptional. Difficulty proving ordinary loss alone does not create a general entitlement to negotiating damages or restitution of the defendant's gains.
Significance
Experience Hendrix illustrates the difference between a reasonable licence-fee measure and stripping all profits. Morris-Garner later explained negotiating damages as compensation for the economic value of a right taken by the breach, rather than a general discretionary response to evidential difficulty. That clarification is essential for using the case in current exam answers. Identify the protected right, the loss caused by its unauthorised use and why a reasonable fee measures that loss before reaching for the exceptional remedy discussed in Blake.
Common exam questions about this case
Why was a full account of profits refused?
The case did not present the exceptional circumstances justifying the remedy in Blake. Breach and the defendant's gains were not sufficient by themselves. The court instead identified a reasonable amount for the unauthorised use of the protected recordings, separating that measure from stripping every profit associated with the breach.
What did the proposed reasonable sum represent?
It reflected the price that could reasonably have been demanded for permission to grant the licences prohibited by the settlement. The focus was the unauthorised use of the protected right. It was not simply the claimant choosing the defendant's profits because ordinary loss had proved inconvenient to establish.
How does Morris-Garner affect the modern explanation?
It treats negotiating damages as compensatory in appropriate cases involving loss of a valuable right. Difficulty proving conventional loss is insufficient on its own. Experience Hendrix should therefore be explained by reference to the recordings right and its unauthorised use, not as a general restitutionary damages option whenever a claimant cannot quantify lost profits.