Costs: Why not abolish the Patents County Court?

I have just finished reading Chapter 24 of Sir Rupert Jackson's final report on costs (Review of Civil Litigation Costs: Final Report) which was published yesterday. It is a good report and I welcome its proposals for intellectual property.

However, back in July 2009 I proposed a more radical solution to the IP Bar Association and the working group of the Intellectual Property Court Users' Committee ("IPCUC") that was set up to formulate proposals for the reform of the Patents County Court. IPCUC did not see fit to include my suggestions in its submissions to Jackson (which is understandable since they call for the abolition of the Patents County Court and an extension and reform of the Comptroller's jurisdiction) but I still they think they have merit.

As Jackson's recommendations will require primary legislation there will have to be a debate in Parliament and perhaps elsewhere on how best to improve intellectual property dispute resolution in the UK (or at least England and Wales). I publish my submissions now in the hope that they may be able to inform that debate.

"Proposals for Reform of the Patents County Court

Comments

Jane Lambert

I agree with the Working Group that “at present SMEs are denied access to justice in IP cases because they are priced out of the system” and that “if litigation were made affordable, many more IP claims would be brought and defended.” I am also of opinion that Her Majesty’s government fails to comply with art 41 of TRIPs and art 3 of the Enforcement Directive by not providing cost-effective procedures for resolving infringement disputes and restricting access to justice to SMEs. I endorse the conclusion that any reformed procedure should be cheaper and that costs should be limited and predictable but I strongly disagree that the way forward is to re-launch the Patents County Court with its own rules of procedure that would differ in many respects from the Civil Procedure Rules.

Those objectives could be achieved better by abolishing the Patents County Court altogether and transferring its functions to the Comptroller-General of Patents, Designs and Trade Marks (“the comptroller”)[1] and harmonizing the procedures of the patents, trade marks and design tribunals. Primary legislation would be required to

· delete the words “and any other person may by agreement with each other” form s.61 (3) of the Patents Act 1977;[2] and

· amend the Registered Designs Act 1949, the Copyright Designs and Patents Act 1988, the Trade Marks Act 1994 and the statutory instruments implementing the Community Trade Mark and Community Design Regulations in the UK to enable the comptroller to hear any claim that falls within paragraphs 2.2 [3] and 18.1 ;[4] of the Part 63 Practice Direction;

· harmonize the practice of the existing IPO tribunals by for example introducing the Appointed Person into patents, designs and other intellectual property claims; and

· confine appeals to appeals from the Appointed Person to the High Court or Court of Appeal on a point of law only.

I fear that the Working Group’s proposals run flat in the face of the Ministry of Justice’s policy of simplifying civil justice within the courts and tribunals structures. Should a pan-European intellectual property court[5] ever be formed the PCC will provide a fourth forum for the resolution of IP disputes competing for specialist work with the Patents Court, the IPO and the new European court.

If the PCC is to remain I am strongly against special rules and practice directions for its business, particularly if they are a common and civil law hybrid. The CPR as amplified and clarified by the Chancery and Patents Court Guides should continue to apply. Perhaps the streamlined procedure could become the default procedure. I agree that applications should be in writing except where there is a special reason for a hearing and in those few applications where a hearing is justified as much as should be done by telephone or video link. Two days may be enough for patent trials which are more likely to turn on the law or the construction of the specification than on fact. They are unlikely to be enough for copyright, breach of confidence or passing off where there is more likely to be a dispute of fact. I agree that costs should be limited to a scale but they should be the same as for the IPO.

3 July 2009

JANE LAMBERT
NIPC(R)
The Media Centre
7 Northumberland Street
Huddersfield
HD1 1RL
T 0870 990 5081
F 0870 990 5082
http://www.nipclaw.com

---

[1] The Chief-Executive of the UK Intellectual Property Office who is also known confusingly as “the registrar” in trade mark and .design matters.

[2] As the section now stands it reads “The proprietor of a patent and any other person may by agreement with each other refer to the comptroller the question whether that other person has infringed the patent and on the reference the proprietor of the patent may make any claim mentioned in subsection (1)(c) or (e) above.”

The need for agreement by all parties effectively stymies this provision forcing all patentees to go to court where they risk substantial costs should their action fail.

[3] “The following claims must be dealt with in the court –

(1) any matter arising out of the 1977 Act, including –

(a) infringement actions;

(b) revocation actions;

(c) threats under section 70 of the 1977 Act; and

(d) disputes as to ownership;

(2) registered designs;

(3) Community registered designs; and

(4) semiconductor topography rights.”

[4] “Any of the following claims must be brought in the Chancery Division, a Patents County Court or a county court where there is also a Chancery district registry –

(1) copyright;

(2) rights in performances;

(3) rights conferred under Part VII of the 1988 Act;

(4) design right;

(5) Community design right;

(6) Olympic symbols;

(7) plant varieties;

(8) moral rights;

(9) database rights;

(10) unauthorised decryption rights;

(11) hallmarks;

(12) technical trade secrets litigation;

(13) passing off;

(14) geographical indications;

(15) registered trade marks; and

(16) Community registered trade marks”

[5] Whether it is a specialist chamber of the European Court of Justice as proposed in some of the earlier drafts pf a Community patent regulation."