Enforcement Roundtable - 8 July 2002, Harmsworth
House, London
Present:
SPEAKERS
Mr Justice Laddie
Peter Hayward (Patent Office)
Greg Hunt (Chartered Institute of Arbitrators)
Michael Harrison (Chartered Patent Agent)
Mandy Haberman (Inventor, Haberman Associates)
Peter Roedling (Hiscox Insurance)
Richard Gallafent (Chartered Patent Agent)
Gavin Terry (TSO - Oldham)
OTHER ATTENDEES
Roy Evans (Small Business Service)
Nick Munn (Innovation Unit)
Paul Leonard (IP Institute)
Jim Houlihan (Nanomagnetics )
Clive Edrupt (CBI)
Ian Buchan (President - ITMA)
Paul Johnston (ICI)
Roland Hill (Contra Vision Ltd)
Andrew Serjeant (CIPA)
Heather Davies (Inventor)
David Perkins (Chartered Patent Agent)
Tony Rollins (Amershams)
PATENT OFFICE STAFF
Ron Marchant (Chair)
Graham Jenkins (moderator)
Judith Sullivan (moderator)
Phil Lewis (moderator)
Jeff Watson (moderator)
Sean Dennehey
Eileen Tottle
Frank Moeschler
Purpose of the meeting
Following the Quinquennial Review of the Office (concluded in early
2001) one of its recommendations was that the Patent Office adopt
a wider role in relation to enforcement. Alongside recognition of
the importance of intellectual property rights is the belief that
enforcement is difficult and can undermine the benefits conferred
by rights. There is currently a high level of discussion of this
issue.
The aim of the Enforcement Roundtable was to identify possible practical
steps that could be taken to resolve the main areas of problems
and weaknesses. With this in mind the speakers and those attending
all had practical experience upon which to base their views.
Report of discussion
The Roundtable covered four areas: (i) Litigation
(ii) Alternative Dispute Resolution
(iii) The role of Trading Standards Offices
(iv) Insurance for litigation costs
Each topic had two speakers who talked about their particular experience
of each subject. A deliberate objective was for each speaker to
approach the subject from opposite ends of the spectrum, thereby
giving a "for" and "against" argument. This
was, in part, to encourage debate but also to give a balanced view.
Taking each subject in turn:
LITIGATION
Mr Justice Laddie spoke of current court procedures and ways they
could be made simpler. Although the speed of the courts had been
improved the problem of costs has not yet been fully solved. He
was of the view that neither disclosure nor cross-examination should
be automatic in every case. In many cases, the judge should only
order such discovery, if any, as is shown to be necessary and cross
examination should be strictly controlled. In many cases neither
discovery or cross examination had made a significant contribution
to reaching a decision. This could be particularly helpful in the
case of the Patents County Court where not enough patent agents
are using their right of audience. The Patents County Court could
be developed into a small court particularly aimed at low-cost actions
conducted by patent agents. He thought there are difficulties with
expanding the role of the Patent Office in dealing with cases given
their involvement prior to grant.
Peter Hayward reminded the meeting that conducting litigation before
the Patent
Office was both cheaper and simpler than before the courts, and
that where it had
jurisdiction it was often the forum of choice even for big companies.
It has power to handle patent infringement cases (though not trade
mark ones) but it had not been used. In part this may be due to
lack of awareness but also both parties needed to agree for a case
to be heard by the Office which created a barrier. The inability
of the Office to grant injunctions might also be a factor, though
that would be less important if Office proceedings became faster.
That would require changes to procedures and more resources.
ALTERNATIVE DISPUTE RESOLUTION
Gregory Hunt outlined the advantages of using arbitration and mediation
services offered by the Chartered Institute of Arbitrators. The
Chartered Institute can provide services which are quick, cheap
and private. The Chartered Institute also have a solid supply of
qualified arbitrators and mediators who are professionals from the
IP sectors - ensuring commonality of standards. The Chartered Institute
can also provide schemes which can be tailored to the particular
need of the client (for example, the Musicians' Union Scheme which
deals with Intellectual Property, Copyright & Trademark disputes
under set Rules and fee structures.) It was also pointed out that
arbitration and mediation are great levellers for disputant parties,
and can in particular redress balance of power issues which were
highlighted (below) by Mandy Haberman.
Michael Harrison pointed out that the costs of arbitration can be
quite significant and also on occasions greater than litigation.
The quality of the arbitrator is crucial and variable and this can
discourage use owing to lack of confidence. The use of arbitration
also limits the extent to which the parties are free to deploy tactics
to their advantage during the disputes. There can be an issue with
how the result of arbitration is made binding and so arbitration
to some extent duplicates litigation.
During discussion the view emerged that for IP disputes mediation
can be of greater benefit than arbitration, though the skill of
the mediator is an essential contribution to the successful outcome.
At the moment the UK probably does not have sufficient numbers of
mediators with IP expertise trained to the necessary standard unlike
the US who lead in this field. A possible way forward would be to
incorporate a mediation stage into litigation seeking to avoid the
need for litigation if possible but to simplify the process should
it prove necessary. Proper recognition of the mediation stage could
be ensured by the judicious use of cost awards.
THE ROLE OF TRADING STANDARDS OFFICES
Gavin Terry outlined the role of the trading standards officer
(TSO). These officers need to work closely with the police force
and have powers to question an offender when the police have made
the arrest. There are significant funding problems and activities
are focussed on those areas where priorities are expressed, eg,
through the setting of targets such as in the case of the Food Standards
Agency. If there were national performance indicators for the reduction
of counterfeiting activities, eg, set by the Patent Office, this
would indicate a national priority as a guidance to Local Authorities.
Mandy Haberman explained the difficulties experienced by small businesses
and inventors when faced with infringement by larger companies.
They cannot match the resources available to larger companies and
need some assistance in levelling the situation. If funding were
made available, perhaps the TSO could be empowered to provide an
alternative, to patent enforcement litigation. This might involve
re-examination of the infringement claim to provide a secure foundation
that the right was valid before the TSO opens a dialogue with the
infringing company, with a view to educating them about IPRs and
compelling them to mediate with the patentee.
During discussion it was suggested that a link between TSOs and
the Small Business Service would improve awareness and accessibility
for small businesses.
INSURANCE FOR LITIGATION COSTS
Peter Roedling explained that IP insurance had evolved from insurance
covering general legal expenses and was intended to provide adequate
limits and cover more than UK actions. The product is still evolving
and insurers are making improvements continually. There are a number
of case studies which show how effective insurance can be but it
is important that potential users are better aware of what is involved.
The insurance industry is committed to better service and work with
stakeholders in achieving this.
Richard Gallafent doubted that insurance could deliver all that
is promised. It is too complicated and needs to be as simple as
life insurance cover. This would be difficult given the vague nature
of the insured event and the likely level of premiums which would
adequately cover such events. The difficulties were highlighted
by the fact that companies had been working for over 20 years to
provide a targeted product and still have not been successful. The moderators then presented a synopsis of the various discussions.
These are set out in the attached slides.
CLOSURE
In closing the Roundtable the Chair, Ron Marchant, summarised his
view of the main points that had emerged. These were: · Enforcement of IP rights is about innovation & wealth
creation, rather than technical legislative changes
· To simplify court procedures by removing automatic disclosure
and cross-examination, by including mediation as part of the litigation
process, and reforming the Patents County Court to focus on simple
and inexpensive procedures
· To develop and encourage the use of mediation as a method
of resolving disputes
· To ensure that Government policies are focussed and prioritised
to deliver effective action against counterfeiting
· Ensure all users are educated in their options and responsibilities
· The need to tackle those who are not listening and continue
deliberately to copy
· To realise that there may not be a single avenue for every
circumstance and that different needs may call for different mechanisms The Patent Office will use the issues raised to work with others
to shape policy to improve opportunities for enforcing IP rights.
Along with this Roundtable the Office is working with the Intellectual
Property Advisory Committee in collecting information from right
holders on their views about enforcement. The result of that exercise
will provide evidence of needs and priorities, and will help us
work on next steps.
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