The Business and Property Courts Practice Direction - IP Litigation outside London

Manchester Civil Justice Centre

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Jane Lambert

According to TaylorWessing's Patent Map, England and Wales remains the most expensive country in Europe in which to contest a patent action. The European Patent Office reports that the UK lay 9th in the number of European patent applications that were filed in 2017 trailing not just the USA, Japan, China and Germany which are considerably bigger in population and GDP than the UK but France, South Korea, Switzerland and the Netherlands that are the same size or smaller (see European patent filings per country of origin). It seems likely that the UK's relatively lacklustre performance in the number of European patent applications is connected to the high cost of enforcement.  I have plenty of anecdotal evidence from my practice, patent clinics and inventors' clubs to support that contention.

One of the reasons why patent litigation in England and Wales is more expensive than in other countries including other common law jurisdictions such as the Republic of Ireland and Scotland is that it is conducted in London. That is because CPR 63.2 (2) requires patent, registered and registered Community design, semiconductor topography and plant variety claims to be brought in the Patents Court or Intellectual Property Enterprise Court ("IPEC"). All other IP claims (that is to say, those listed in paragraph 16.1 of the Part 63 practice direction) may be brought in the Chancery Division in London or one of the district registries listed in paragraph 16.2 of the practice direction ("Chancery District Registries") or a County Court hearing centre where there is also a Chancery District Registry as well as IPEC pursuant to CPR 63.13.  However, as there are specialist judges in London and costs caps in IPEC there is every incentive to bring IP actions in London even where the parties, their legal representatives and witnesses are in another part of the country.

That may change as a result of the Practice Direction - Business and Property Courts.  In Launch of a Judicial Super Highway? 13 July 2017 IP Northwest, I introduced the Business and Property Courts as a judicial super highway which integrates the specialist courts in the Rolls Building with those elsewhere in England and Wales to ensure that international businesses and domestic enterprises are equally supported in the resolution of their disputes. 

Paragraph 2.3 (2) of that practice direction provides:

"With the exception of claims started under Parts 58, 60, 61 and 62, claims which are intended to be issued in the Business and Property Courts and which have significant links to a particular circuit outside London or anywhere else in the South Eastern Circuit must be issued in the B&PCs District Registry located in the circuit in question. If a claim has significant links with more than one circuit, the claim should be issued in the location with which the claim has the most significant links."

As IP claims are governed by Part 63 they do not fall within any of the above exceptions.   Paragraph 1.2 of PD-Business and Property Courts includes the Business and Property Courts in Birmingham, Bristol, Leeds, Liverpool, Manchester, Newcastle and Cardiff within the definition of "B&PCs District Registries".

Paragraph 2.3 (3) explains what is meant by the words "links to a particular circuit":

"A link to a particular circuit is established where—
(a) one or more of the parties has its address or registered office in the circuit in question (with extra weight given to the address of any non-represented parties);
(b) at least one of the witnesses expected to give oral evidence at trial or other hearing is located in the circuit;
(c) the dispute occurred in a location within the circuit;
(d) the dispute concerns land, goods or other assets located in the circuit; or
(e) the parties’ legal representatives are based in the circuit."

Paragraph 2.3 (4) adds:

"A claim which raises significant questions of fact or law in common with another claim already proceeding before a B&PCs District Registry may be regarded as having significant links with the circuit in question."

However, that is subject to paragraph 2.5 (3):

"A claim in the Intellectual Property List, which includes the Patents Court and the Intellectual Property Enterprise Court (“IPEC”) (and includes the IPEC small claims track to which rule 63.27 applies), may be issued in an appropriate BPCs District Registry. However the case management and/or trial of a claim in the Patents Court or the IPEC in the BPCs District Registry in question will be dependent on an appropriate judge being made available in the district registry in question."

In other words, a claimant or its legal representative is expected to issue a IP claim outside London even if it is one that must proceed in the Patents Court or IPEC, if it has a significant link to a circuit. The case management conference and trial may still be conducted in London if an assigned or enterprise judge cannot be found to hear the case on circuit.  However, both the Patents Court and IPEC guides have stated for many years that assigned and enterprise judges will sit outside London for the purpose of saving time or costs (see paragraph 4 of the Patents Court Guide and paragraph 1.5 of The Intellectual Property Enterprise Court Guide).

Anyone wishing to discuss this article should call me on 020 7404 5252 during office hours or send me a message through my contact form.