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Litigate, arbitrate or mediate?

There are several ways to resolve IP disputes, including litigation and alternative dispute resolution (“ADR”) options such as mediation and arbitration.

Negotiation

When emotions run high, direct discussions may break down. Conducting negotiations through external lawyers often takes the “heat” out of a situation and enables compromise without loss of face.

Mediation

An independent third party – the mediator – is jointly appointed by the parties. He/she can meet with the parties, either together as a group, individually or a combination thereof, to act as a go-between, bring different perspectives and/or otherwise “facilitate” an agreed settlement. Mediation can help to dislodge entrenched positions which negotiation has failed to shift.

Arbitration

The parties appoint an independent third party or panel – the arbitrator – to listen to both parties’ positions and reach a binding decision on the case. This is useful where the parties are seeking greater confidentiality or control of the process than the courts can provide, or the contractual position between the parties requires it, or there is an international element difficult to resolve in a single court.

Litigation

Unless there is some consensus between the parties to use arbitration or other ADR option, litigation in the courts is the only available option for determination of disputes.




 

The flexibility of the ADR options (mediation, arbitration etc.) allows the parties to agree a process and timeline bespoke to their needs and goals. In contrast, the process of litigation has several predictable stages. Within the UK, a typical case in the High Court is summarised below.


Pre Action Stage

Before litigation starts, the (potential) parties need to prepare and refine their cases as far as is possible and known.  For the rights-holder, detailed analysis of the infringing product or process can be undertaken, and due diligence carried out on potential defendants. For the potential defendants, or challengers to IP rights, the registered right itself can be analysed, prior art searches (or historical industry research) undertaken to assess validity and (if possible) analysis carried out of any existing licences or potential “exhaustion” of rights issues.


Early Stage Litigation

In the first few months, the parties set out their legal position in “Statements of Case” exchanged with each other and filed on the public record at court. At this stage, prior art (or any pre-existing use of trade marks as appropriate) can be identified, as well as the allegedly infringing products and activities.

Interim applications for injunctions can also be made at this stage, if infringement is imminent and irreparable harm is otherwise likely.

Following the exchange of Statements of Case, a Case Management Conference (CMC) will typically be held to decide upon the timetable to trial.


Disclosure

Standard “disclosure” in effect requires each party to provide to the other(s) copies of all pre-existing documents in its control which support or adversely affect any party’s case. For patents, the period of disclosure of documents relating to validity is limited to a four-year “window” (two years either side of the earliest priority date) and defendants have the option to prepare a full description of the allegedly infringing product instead of providing disclosure in the form of pre-existing documents.


Evidence

Once disclosure has been given, the parties’ witnesses prepare and file their written evidence, both of fact and of expert opinion. In a patent case, expert reports on the key technical issues (of patent validity and infringement) are particularly important.


Trial

At trial, the fact and expert witnesses will be cross-examined by the other party’s barrister to probe the correctness and completeness of their written evidence. Both sides barristers will also present their cases to the Judge.

Parties’ cases can develop substantially during trial depending on the outcome of cross-examination. Nuanced legal argument as to the validity of the IP right and/or infringement by the defendant is made to the Judge, both orally and in writing.


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POSTED 7 June 2017

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