Posted on March 24, 2020
Traditionally, holders of intellectual property (IP) rights (patents, trade marks, designs and copyright, for example) would enforce their rights in the UK by launching legal action at the High Court. This was and is expensive, and a misconception persists that this is still the only option available for rights holders. This is not the case, however, and there are far more cost-effective options available.
No one disputes that taking legal action against potential infringers of IP rights can be expensive, especially when there’s a lot of money at stake. And no one disputes that taking legal action can, in certain circumstances, take a large amount of business resource. This need not be the case, however, and there are lots of ways in which rights holders can take action against third parties that are far less expensive than traditional High Court litigation.
It should be noted that very few UK IP disputes lead to court proceedings. Most disputes are settled through an exchange of correspondence between the legal advisors of the parties involved. This exchange of correspondence (often called “pre-action” because it happens before a court case, even if a court case is not subsequently launched) allows the parties to gauge the relative strengths of their positions and to act accordingly, based on advice provided by their legal advisors. Most companies behave with integrity and honesty, and if a company is infringing a valid IP right, then that company will often stop.
If a dispute is not settled by the exchange of pre-action correspondence, then it is possible to take further action in a more affordable way at the High Court using the delightfully named Intellectual Property Enterprise Court (IPEC). IPEC can hear cases having a value of up to £500,000, and more if all parties agree. For cases relating to trade marks, copyright and unregistered design rights having a value of up to £10,000, then the “small claims track” can be used. For all other cases, the “multi-track” is used. Some remedies (such as interim injunctions) are not available through the “small claims track”, but you can still get damages and a final injunction stopping an infringer from further infringement. In all IPEC cases, there are strict limits on the amount the winning party can claim for legal costs from the other side. This cost cap helps provide all parties with a better advance picture of the likely costs of taking action, whatever the final outcome. As of October 2019, the small claims track court sits in London, Birmingham, Bristol, Cardiff, Leeds, Manchester and Newcastle. The multi-track court usually sits in London but may sit elsewhere if all parties agree.
Many other enforcement options that do not include launching a court action are available. Customs procedures are in place in many countries (for example, China, the EU and the UK) that allow rights holders to ask customs officials to seize products that infringe IP rights. Such procedures are often used by the owners of registered trade marks and copyright, but it is possible to use registered designs, patents and other IP rights as the basis for customs seizures.
There are many other things that a rights holder can do to improve their legal position before taking any action. They can be proactive in marking their goods with the relevant IP numbers, symbols and signs to let third parties know that the goods are protected by an IP right. For example, an owner of a registered trade mark should indicate that the mark is registered by using the registered trade mark symbol ®. This is a clear statement of ownership, and an assertion that a Registered right is held. In the UK at least, instead of marking the actual goods/packaging themselves with specific IP right registration numbers, specifying the location of an online list of protected IP rights will suffice, so long as it is clear in that list which IP rights protect which product. A rights holder can also arrange to keep a watch for potentially infringing articles, and make test purchases.
It is sensible to involve an IP legal advisor before sending any correspondence to potentially infringing third parties. Professional advice can greatly reduce the risk of falling foul of various “unjustified threats” provisions, which can leave the rights holder exposed. Rights holders should not be surprised if the alleged infringer argues that the IP rights being asserted are not valid, or threatens or even tries to revoke the IP rights with a view to securing a favourable outcome. Some procedures, such as IPEC actions, run quickly, and so it is important to be prepared for such counter-arguments in advance. Rights holders should therefore get their own house in order before taking immediate action by discussing the strength of their potential case against the alleged infringer and the options available with their IP advisor.
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