Enforcing Intellectual Property Rights in England and Wales

Jane Lambert 4-5 Gray’s Inn Square

www.4-5.co.uk

No such thing as UK Law

• Unlike Germany the UK is a unitary state so there is no such thing as federal law

• Administration of justice is devolved to Scottish and Northern Irish governments

• There are three legal systems in the UK with very different court systems, rules of procedure and even legal terminology (eg. “claimant”, “pursuer” and plaintiff”)

Rest of Discussion will focus on England and Wales • Civil Procedure Rules came into force in April 1999

(http://www.justice.gov.uk/courts/procedure-rules/civil)

• Replaced separate rules of procedure for the Senior Courts (then called the Supreme Court) and the County Courts

• CPR consist of Rules and Practice Directions

• Part 63 and PD Part 63 deal with IP claims (http://www.justice.gov.uk/courts/procedure-rules/civil/rules/part63}

• CPR are supplemented by Court guides

Courts of England and Wales

• Senior courts include a Court of Appeal and a court of first instance known as the High Court

• High Court consists of three divisions: Chancery, Queen’s Bench and Family

• Nearly all intellectual property claims are heard by the Chancery Division

• Within the Chancery Division there are two specialist courts for IP: the Patents Court and Intellectual Property Enterprise Court (“IPEC”)

Chancery Division

• IPEC hears claims of less than £500,000 that can be tried in no more than 2 days (

• IPEC has a small claims track for IP claims (other than patents and registered or registered Community designs) of less than £10,000

• Patents Court hears patent, registered designs, registered Community design cases

Chancery Division

• All other IP claims are heard by the judges of the Chancery Division who also hear company, real property, trusts and probate cases

• The Patents Court, IPEC and the rest of the Chancery Division apply different parts of Part 63 and PD63 to different types of IP claim

• There are separate Chancery, Patent Court, IPEC multitrack and small claims track guides

Chancery Division

• Chancery Guide: http://www.justice.gov.uk/downloads/courts/chancery-court/chancery-guide.pdf

• Patents Court Guide: http://www.justice.gov.uk/downloads/courts/patents-court/patent-court-guide.pdf

• IPEC Guide: http://www.justice.gov.uk/downloads/courts/patents-court/intellectual-property-enterprise-court-guide.pdf

• IPEC Small Claims Guide: http://www.justice.gov.uk/downloads/courts/patents-court/patents-court-small-claims.pdf

Chancery Division

• In IPEC recoverable costs for claims of under £500,000 are limited to £50,000 for determination of liability and £25,000 for determination of damages or accountable profits

• In the IPEC small claims track recoverable costs are limited to just a few hundred pounds

Civil Procedure in England and Wales

• Civil procedure in common law jurisdictions such as England and Wales differs considerably from that of the civil law jurisdictions of the Continent

• In common law countries it is the parties rather than the judges who decide the issues that the court will try and the evidence that is to be adduced

Civil Procedure in England and Wales

• Cases are determined in phases: - pre-action correspondence where parties exchange information and try to resolve their dispute through negotiation or some other form of ADR - issue of claim and exchange of statements of case (formerly known as “pleadings”) - disclosure where parties exchange lists of documents in their possession or control

Civil Procedure in England and Wales

- exchange of witness statements and experts’ reports - trial where each party presents its witnesses and physical evidence, cross-examines the witnesses of the other parties and presents legal arguments - if the claimant wins there is an inquiry or account where the process is repeated

Civil Procedure in England and Wales

• IPEC streamlines that procedure by requiring a case management conference after exchange of statements of case where the court fixes a date for trial, identifies issues to be tried and evidence to be adduced and sets a timetable

• The small claims track determines liability and remedy in one session and dispenses with most of the other phases altogether

Civil Procedure in England and Wales

• A trial usually takes place a year after the issue of proceedings whether the case proceeds in IPEC or not

• An account of profits or an inquiry as to damages takes place a year after trial

• An appeal to Court of Appeal can be heard a year after the trial or account or inquiry

• Small claims cases can be heard within months of issue of proceedings

Civil Procedure in England and Wales

• Common law procedure is much more expensive than that of civil law countries

• A study by IPAC in 2003 found that the average cost of a patent infringement claim in England was over £1 million in Patents Court and US$2 to 4 million in USA but only about €50,000 in France and Germany and €10,000 to €40,000 in Netherlands (http://webarchive.nationalarchives.gov.uk/+/http:/www.hm-treasury.gov.uk/d/contra_vision_ltd_336_p4_163kb.pdf)

Civil Procedure in England and Wales

• Because litigation is expensive parties are encouraged to settle their dispute through negotiation or ADR as early as possible

• Unless there is good reason to believe the defendant will hide or destroy evidence or remove or dissipate assets claimants are expected to send a “letter before claim” before issuing proceedings

No such thing as a “cease and desist” letter in English terminology

• Nearest we have is a “letter before claim”

• Para 7.1 (1) PD – Pre-Action Conduct provides: “7.1 Before starting proceedings – (1) the claimant should set out the details of the matter in writing by sending a letter before claim to the defendant. This letter before claim is not the start of proceedings;”

• The defendant is expected to respond in full within 28 days

No such thing as a “cease and desist” letter in English terminology

• The purpose of the letter before claim is to encourage negotiation and ADR in accordance with the PD rather than by litigation

• If a party does not try to resolve the dispute in accordance with the PD it can be penalized by a costs order or some other sanction

Injunctions

• Senior Courts have power to grant final and interim injunctions under s.37 Senior Courts Act 1981

• Disobedience to an injunction is punished by imprisonment or financial penalty and not simply an astreinte as in most civil law jurisdictions

• Final injunctions are granted after trial but before account or inquiry and interim injunctions awarded after start of proceedings

Interim Injunctions

• Before CPR were introduced in 1999 interim injunction applications were commonplace in IP litigation

• Much rarer under CPR largely because they are expensive and the losing party has to pay the costs of the application within 14 days of decision

Interim Injunctions

• Granted if the court decides the applicant can win, damages will not compensate applicant adequately for its loss if it wins and that the applicant can compensate the respondent adequately in damages if the court later decides that the injunction should never have been awarded

• Court has power to grant special interim injunctions known as “search orders” and “freezing injunctions” which are granted without notice to the defendant

Interim Injunctions

• The small claims track of IPEC has no jurisdiction to grant interim injunctions

• IPEC has power to grant interim injunctions but rarely does so

• Claimants who require interim injunctions would bring their claims in the Chancery Division or Patents Court if the claim is for registered or registered Community design infringement

Search Orders

• An order requiring an occupier to admit a solicitor who is independent of the parties and the applicant’s lawyers and experts to search the occupier’s premises, vehicles and computers for documents and physical evidence and to take copies or samples of such evidence

• Only granted if judge believes that the defendant may destroy or hide evidence

Freezing injunctions

• An order prohibiting the respondent from transferring funds or spending moneys otherwise than in the normal course of business

• Only granted if the judge believes that the defendant may remove or dissipate assets

• Search orders can be combined with freezing injunctions

What happens in Practice

• Because of costs most cases are settled by negotiation, mediation or other forms of ADR long before the action goes to trial

• Piracy, counterfeiting and since 1 Oct 2014 deliberate copying of registered or registered Community designs are offences

• IPO and trading standards officers have IP Crime Unit

• IP owners can bring private prosecutions in worst cases

Any Questions?

Jane Lambert 4-5 Gray’s Inn Square

020 7404 5252 jlambert@4-5.co.uk

http://nipclaw.blogspot.co.uk/p/profile.html