Background
This costs ruling follows the Full Court’s substantive decision in Comino v Watson Webb Pty Ltd [2026] FCAFC 66 (delivered 21 May 2026), which resolved three consolidated proceedings arising from a dispute over registered Australian industrial designs (Nos. 201811005 and 201811810). The underlying litigation in NSD1337/2021 had been fought between John Alexander Comino and Strongcast Pty Ltd on one side, and All Valve Industries Pty Ltd (AVI) and Cav. Uff. Giacomo Cimberio S.p.A. on the other, with Watson Webb Pty Ltd (formerly Watson Chiarella Pty Ltd) also involved as Comino’s former solicitors in a separate leave-to-appeal application concerning the primary judge’s costs order.
The parties reached agreement on the substantive orders to flow from the Full Court’s earlier judgment but could not agree on costs. Three discrete proceedings were before the Full Court for costs purposes: the main appeal (NSD1656/2025), an unjustified threats appeal under s 77 of the Designs Act 2003 (Cth) (NSD1998/2025), and an application for leave to appeal the primary judge’s costs judgment (NSD2057/2025). The primary judge had ordered Comino and Strongcast to pay 75% of AVI and Cimberio’s costs on a party/party basis.
AVI and Cimberio sought a single consolidated costs order across all three proceedings and argued that the primary judge’s costs order should be set aside or varied. Comino and Strongcast sought to have the primary judge’s costs order remitted for further determination, and also sought variation of that order to provide for lump-sum assessment.
The Court’s Holding
The Full Court declined to make a single consolidated costs order, preferring separate orders for each proceeding because the unjustified threats appeal and leave application had straightforward “costs follow the event” outcomes. In the unjustified threats appeal (NSD1998/2025), the Court allowed the appeal, declared that threats made in a letter dated 28 February 2020 were unjustified under s 77(1)(a) of the Designs Act, remitted the question of damages and additional damages to the primary judge, and ordered Comino and Strongcast to pay AVI and Cimberio’s costs. In the leave-to-appeal application (NSD2057/2025), Comino was ordered to pay Watson Webb’s costs.
In the main appeal (NSD1656/2025), the Court ordered Comino and Strongcast to pay only 50% of AVI and Cimberio’s costs, reflecting the mixed outcome on the issues. AVI and Cimberio succeeded on the breach of confidence, additional damages, and Australian Consumer Law grounds, while Comino and Strongcast succeeded on the constructive trust issue — success that was in part attributable to an undertaking offered during the hearing. Adopting a broad-brush issue-by-issue approach and weighing the relative significance of each issue, the Court settled on 50% as the appropriate apportionment.
The Full Court declined to disturb the primary judge’s 75% costs order in NSD1337/2021, finding that the overall outcome had not changed materially — AVI and Cimberio gained an additional cause of action (unjustified threats) while Comino achieved only limited success on the form of relief for breach of confidence. The Court also declined to vary that order to provide for lump-sum assessment, leaving that question to be raised with the primary judge. All appellate costs were ordered to be determined on a lump-sum basis under practice note GPN-COSTS, with referral to a Registrar if not agreed within four weeks.
Key Takeaways
- Where appellate success is genuinely mixed across multiple issues, Australian courts will apportion costs on a broad-brush issue-by-issue basis rather than simply awarding all costs to the overall winner — here, 50% despite AVI and Cimberio succeeding on the majority of grounds.
- A primary judge’s costs order will not be disturbed on appeal merely because the appellate outcome adjusts some issues, unless the overall result has changed materially; incremental shifts in the balance of success are insufficient grounds for remittal.
- Procedural questions about the method of costs assessment (lump-sum vs. party/party taxation) that relate to first-instance orders are best addressed by the primary judge, not the appellate court, even where lump-sum assessment is the norm for appellate costs.
- Where multiple related proceedings are resolved in a single appellate decision, separate costs orders for each proceeding may be preferable to a single consolidated order when the outcomes — and therefore the appropriate costs principles — differ between proceedings.
Why It Matters
This decision is a practical illustration of the discretionary costs framework in complex, multi-issue intellectual property appeals. It confirms that Australian courts will not reflexively award full costs to the party that wins “on balance” when the litigation spans substantially distinct issues with different outcomes, and that an undertaking given during appeal proceedings can directly affect the apportionment of costs attributable to the issue on which it bore.
The ruling also signals that parties seeking to revisit a trial judge’s costs order after an appeal should be prepared to demonstrate a material change in the overall result, not merely incremental adjustments. For practitioners managing multi-proceeding design-rights disputes, the case reinforces the GPN-COSTS lump-sum regime as the default for appellate costs, and cautions against seeking consolidated orders when the underlying proceedings have meaningfully different cost dynamics.