Patent County Court To Have 50,000 Cost Limit

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Court costs for UK patent disputes are set to be cut from up to 1m to just 50,000

The Chartered Institute of Patent Attorneys which represents most of the UK’s 1,500 registered patent attorneys, has welcomed radical proposals to slash the cost of patent and other intellectual property court cases. Under the proposals, businesses will have the chance to enforce their patent rights, trade marks and designs for a fraction of the existing costs. Currently in extreme cases such as the Blackberry patent infringement litigation between Research In Motion UK Limited and Visto Corporation in the UK High Court, the lawyers costs on the RIM side using London solicitors added up to around £6m, and the costs on the Visto side were of the order of £1m. RIM's legal costs were considered to be on the high side by the UK court. However the scale of Visto's lawyers bill for a patent infringement case was not out of the ordinary.   

The Intellectual Property Court Users’ Committee has recently published its proposals to reduce the typical cost of a patent or trade mark court case from its current levels of between £500,000 and £1m to a maximum of £50,000. Once implemented, this will have the effect of making the UK among the lowest-cost jurisdictions in Europe, rather than the most expensive, as it is at present.

Alasdair Poore, Vice-President of CIPA and the profession’s representative on the Users’ Committee, said that the proposals will make IP litigation very much more accessible for smaller companies. “Under the proposals, the patents courts will have their rules rewritten so that intellectual property disputes can be resolved quickly and for a fraction of the cost of existing claims in the UK,” he explained. “Disputes costing £1m or more could be decided for around one twentieth of the cost.”

The primary cost limiting proposal is to limit the costs which can be recovered from either party in the Patents county Court to £50,000. The proposals are aimed at making the courts more accessible to innovative SMEs involved in intellectual property disputes usually involving patents, trade marks or designs. This compares with typical costs up to £1m or more for patent cases currently in the High Court and means that an SME will know what the maximum cost exposure is. Trials will be limited to one to two days. Paperwork and documentation will be slashed. Hearings will be heard as soon as possible after the parties have set out their case.

“These proposals show real innovation - in the UK,” Alasdair Poore stated. “For the rest of Europe, this is much closer to what they already have. Now that the proposals have support from business, lawyers and judges, we look to the politicians to make them happen.”

Background

At the instigation of the Patents Court judges, in response to widespread dissatisfaction with the level of costs in patent disputes, the judges and representatives from industry and the professions, including CIPA, are making proposals for a major change in direction. 

The Patents County Court was originally set up, with CIPA support, as a forum for less costly litigation, to be accessible to SMEs.  After a popular start, cases such as Pavel v Sony (a claim that the Sony Walkman infringed Mr Pavel's patent) clogged up its arteries, and even the more recent reforms of the civil litigation system failed to clear them.  Indeed, they had the effect of turning the Patents County Court into a satellite Patents Court with the same procedures, same costs and similar time scales. 

Chartered Patent Attorneys have rights to represent in the Patents County Court, and many also have rights to represent in the Patents Court, part of the High Court - a move which was supposed to increase competition and lower costs for companies involved in patent, trade mark or design disputes. However, because the unsuccesful party is still exposed to the legal costs of the successful party, over which they have no control, being involved in an intellectual property action in the UK courts still entails the risk of having to pay millions of pounds in meeting the other party's costs if the litigation is unsuccessful. Effectively patent and trade mark litigation is unaffordable or unattractive even for some quite large UK companies.   

Unusually – possibly uniquely - among proposals for reform of patent litigation in the last 200 years, these present cost cutting proposals have won support from judges, all sides of the intellectual property professions, and small and big business alike. 

CIPA has been actively supporting these proposals, which follow on its own proposals for streamlining the intellectual property field, and Alasdair Poore, Vice President of CIPA, has been one of the members of the working group which has put together the proposals. CIPA sees the proposals as a key element providing an affordable intellectual property system for innovative SMEs - something which, if they are implemented, will provide a real opportunity for SMEs in the UK to have access to the courts for enforcing the IP rights - something which until now has mostly been the province of the wealthiest businesses.

Article Published August 5, 2009