Thursday, 9 February 2017

Small IP Claims Update

Royal Courts of Justice
Creative Commons Licence

Jane Lambert

It is not often that one receives an accolade from a client. Usually, if a client wins, it is down to the natural justice of the case and nothing to do with the eloquence or preparation of the advocate. If the client loses, it's all the lawyer's fault.

So it was lovely to receive thanks from a public access client earlier this week whose case in the small IP claims track has just been resolved to his satisfaction. The client said that it actually took him a very long time to find someone who truly understands IP the way I do, especially in relation to e-commerce and added that there is certainly a market there for me to tackle.

Although the case was in the small claims track it was not an easy one.  Had the claim not settled a novel point of law would have to have been decided and there were also procedural issues that required several preliminary hearings.

Before 2010 claims like this would have been brought in the Chancery Division of the High Court of Justice where the costs on each side would have run into thousands.  Since 2012 it has been possible to run most IP claims where the primary relief sought is an injunction in the small claims track of the Intellectual Property Enterprise Court ("IPEC").  As I said in There's Nothing Small About the Small IP Claims Track 3 Feb 2017 Linkedin, the legal issues in the small claims track can be just as complex as those in the multitrack but the procedure is much simpler and the costs correspondingly lower.

I have updated my Small IP Claims page with two new articles:
Should anyone wish to discuss this article or IP enforcement in general, call me on 020 7404 5252 during office hours or send me a message through my contact form.

Tuesday, 7 February 2017

Five Pernicious Intellectual Property Myths

Jane Lambert

In this article, I am challenging the following myths that are probably responsible for our trailing many of our competitors in the number of patent, design and trade mark applications.

Myth #1  There's no point in acquiring an intellectual property right because you can never afford to enforce it.

It is probably still the case that England and Wales (and indeed Scotland and Northern Ireland) are among the most expensive countries in the world to bring a full blown patent action.  That is because our legal system provides for close investigation of the evidence and full consideration of the arguments which tends to assure the most just outcome.

But most IP cases do not require that degree of scrutiny. For the last 6 ½ years the Intellectual Property Enterprise Court (formerly the Patents County Court) has provided a high-quality dispute resolution service where the issues are defined in advance, trials are limited to two days and recoverable costs are capped at £50,000  (see Jane Lambert New Patents County Court Rules 31 Oct 2010).

Since 1 Oct 2012, there has been a small IP claims track that covers claims for injunctions and damages limited to £10,000 where the recoverable costs are limited to just a few hundred pounds (see Small IP Claims).

Now every solvent business should be able to afford to bring or defend a small IP claim and most can afford some kind of IP insurance (see IP Insurance: CIPA's Paper 1 May 2016 Inventors' Club).

Myth #2  Don't bother with IP because they will only take it away from you if you try to enforce it.

This is usually a cry of despair when an IP owner realizes that IP law does not exist solely for his or other owners' benefit.

Intellectual property law balances three public interests:
  • incentivizing innovation and creativity,
  • promoting competition between suppliers, and
  • safeguarding consumers' choice.
By its nature, an IPR is a restriction of competition and customer choice which is granted only where it is earned and deserved. That is why we have continued scrutiny of registered rights after grant particularly during infringement proceedings which occasionally results in the revocation or invalidity of the grant.

However, inventions, brands and designs that truly merit legal protection will always get it.

Myth #3  Why go to court to enforce your IPR? You can rely on the CPS or trading standards to do it for you.

Some IP infringements are offences but not all or even most of them. Most notably, it is not a crime to infringe a patent in this country. Also, prosecuting authorities do have other priorities.  Primary responsibility for enforcing an IPR rests with IP owners and the usual way in which they enforce their rights is by taking action against infringers in the civil courts.

Myth #4   Why take out IP insurance? You can always find a lawyer to take up your case on a "no win no fee" arrangement.

Increasingly unlikely since the Legal Aid, Sentencing and Punishment of Offenders Act 2012 has abolished recovery of success fees and after-the-event insurance premiums (see Jane Lambert Intellectual Property Litigation - the Funding Options 10 April 2013). From an IP lawyer's point of view, conditional fee and damages based agreements do not make any kind of sense. 

Myth #5   Why pay for a patent, trade mark or registered design when you can rely on trade secrecy, passing off or design rights to protect you for free?

Different intellectual property rights do different things. 

There is often some overlap between say passing off and trade marks and registered and unregistered designs but one right does not substitute for the other.

Patents and trade secrets are diametric opposites. You get a patent by telling the world how to make or use your invention. You keep a trade secret by staying stum and rely on the law of confidence to make others who are in the know to do the same.  Sometimes trade secrecy can be very effective. The recipe for Coca-Cola has been kept secret for over a century and that for Chartreuse for many centuries, The problem is that the obligation of confidence disappears once the trade secret is generally known. That can happen through parallel research or even reverse engineering.

You always consider the full IP toolbox when devising your IP strategy and choose the rights that are most effective for your business and fit your budget.

If you wish to discuss this article, call me on  020 7404 5252 during office hours or message me through my contact form.

Thursday, 2 February 2017

The Duty to Consider ADR

Jane Lambert

"Litigation should be a last resort" begins para 8 of Practice Direction - Pre-Action Conduct and Protocols which both sides to a dispute are required to follow. The paragraph continues:
"As part of a relevant pre-action protocol or this Practice Direction, the parties should consider whether negotiation or some other form of ADR might enable them to settle their dispute without commencing proceedings."
The obligation to consider ways of settling a dispute is not a once-and-for-all step but continues even after a claim form has been issued.

What Paragraph 8 means in Practice

When I read that paragraph to clients they often have three questions:
  1. What is meant by "ADR"?
  2. How do I get some of this ADR? and
  3. What happens if I don't consider ADR?
What is meant by ADR?

"ADR" stands for "alternative dispute resolution" which is defined in the Glossary to the Civil Procedure Rules as
"Collective description of methods of resolving disputes otherwise than through the normal trial process."
Para. 10 of the Practice Direction suggests 4 types of ADR, namely:
"(a) mediation, a third party facilitating a resolution;
(b) arbitration, a third party deciding the dispute;
(c) early neutral evaluation, a third party giving an informed opinion on the dispute; and
(d) Ombudsmen schemes."
The last of these is not really relevant to most intellectual property ("IP") or TMT ("technology, media and telecommunications") disputes so I will concentrate on the first three. I have experience of all three kinds of alternative dispute resolution both as an advocate and legal advisor and as a dispute resolution service provider as I sit on the WIPO (the UN Agency for Intellectual Property) panel of neutrals and I am listed on the Intellectual Property Office's Mediation Providers.

How do I get some of this ADR?

I discussed some of the types of ADR that are available for the resolution of IP disputes in Intellectual Property Dispute Resolution in the UK 30 Jan 2017.  In that article I mentioned two ADR services that are tailor made for IP and TMT disputes, namely patent examiners' opinions from the Intellectual Property Office on patent issues and the Uniform Domain Name Dispute Resolution Policy for generic top level domain name disputes (ie ".com", ".net" and ",org" disputes) and similar schemes for ".uk" and ".eu" domain name disputes, In IP Mediation 22 May 2015 I considered the mediation services that are specifically designed for IP disputes and in IP Arbitration 3 Dec 2015 I wrote about the specialist arbitration services.

What happens if I don't consider ADR?

The short answer is that you could waste a lot of time and lose a lot of money.  The Ministry of Justice website lists a number of standard case management directions which are routinely given in the multitrack. The second of those directions provides:
"At all stages the parties must consider settling this litigation by any means of Alternative Dispute Resolution (including Mediation); any party not engaging in any such means proposed by another must serve a witness statement giving reasons within 21 days of that proposal; such witness statement must not be shown to the trial judge until questions of costs arise."
These directions are proceeded by a general warning in bold type at the top of the order:
"Warning: you must comply with the terms imposed upon you by this order otherwise your case is liable to be struck out or some other sanction imposed. If you cannot comply you are expected to make formal application to the court before any deadline imposed upon you expires."
So the courts are serious. That warning is reinforced in terms by para 14 (c) of the Practice Direction:
"14. The court may decide that there has been a failure of compliance when a party has—
(c) unreasonably refused to use a form of ADR, or failed to respond at all to an invitation to do so."
Para 15 sets out some of the things that the court can do such as remove any restraints that may have been imposed on your opponent, delay your action indefinitely or penalize you with sanctions. Those sanctions can include making you pay extra costs or interest if you lose the action or disallowing some or all of your costs or making you pay the other side's even if you win.

But the main disincentive for not considering ADR is that the dispute could continue a lot longer and cost a lot more money than it might have done, Queen Mary College's report on Pre-empting and Resolving Technology, Media and Telecoms Disputes, International Dispute Resolution Surveywhich can be downloaded from the WIPO's website, highlights the advantages of arbitration and mediation as perceived by some of the world's biggest companies.  Those companies forecast that more disputes will be referred to ADR and fewer will be resolved by the courts over the next few years.

How can I help you?

When I have explained all this to a client whether he or she is a potential claimant or someone who has been threatened with a letter before claim I am usually asked what can be done about it. The answer will depend on the circumstances.

Some cases are better suited to one form of ADR and others to another. Negotiation may be the best plan in some cases or it may be that there is an arbitration or other dispute resolution agreement between the parties. Whatever the situation, I can advise on the next step.

It may be appropriate to suggest a form of ADR in a letter before claim or response which I am often instructed to draft. I can represent a client in party-to-party negotiations or mediation. If there is an agreement I can draft or help draft the terms of settlement.  If no agreement is reached I can advise on the next step.

If the parties agree to arbitrate, I can draft an arbitration agreement or notice under an existing agreement, statements of case, skeleton arguments and other documents. If there is an oral hearing I can appear for you before the arbitrator. If you win I can advise you on, and assist you with, enforcement. If you lose, I can advise you on whether, and if so how, you can challenge the arbitrator's award.

Further Information

Should you wish to discuss this article or if you have an IP or TMT dispute upon which you need advice, call me on +44 (0)20 7404 5252 during office hours or send me a message through my contact form.