1 June 2014Jurisdiction reportsAlison Simpson and Mark Green

Business brief 2014: UK

Patents

How do you register or secure patent rights, and is national or international coverage most appropriate?

European patents can be validated in the UK from patent applications filed at the European Patent Office (EPO). The UK and the EPO are members of the Patent Cooperation Treaty (PCT) for applicants seeking patent protection internationally for their inventions through one initial filing.

An international, national UK or EPO patent application must be filed before public disclosure of the invention and a patent must be granted/validated in order to take action against infringement in the UK.

What are the costs for obtaining a patent, and what are the costs of defending it?

A typical UK patent from filing to grant may cost £3,000 to £5,000 for a straightforward case. Actions for infringement may be brought before the High Court or the IP Enterprise Court (IPEC). Hearings are before a single judge sitting without a jury. Typically the judges specialise in IP matters.

A High Court action could cost £150,000 to £300,000 for a full infringement/validity trial. Remedies available include damages for actual loss and injunction to stop continuing infringement. Costs are generally awarded to the successful party but recovery is usually limited to costs that are proved to be proportionate to the value of the case. IPEC is cheaper for smaller claims and has a cap on costs awards of £50,000 and maximum damages of £500,000. Low value and less complex claims can be pursued through a small claims track.

Where can you find information on existing patents in your jurisdiction?

Information is available through the UK IPO website (www.ipo.gov.uk) and the EPO search database Espacenet (www.espacenet.com).

Is there anything unusual about the patent law that companies should be aware of, and what are the most common mistakes businesses make?

UK patent law is mostly harmonised with that of other EU countries so there are no unusual practices. However, in the case of suspected infringement businesses should be aware not to make ‘unjustified threats’.  A common mistake made by businesses is publicly disclosing an invention before filing a patent application, which will likely lead to the patent being invalid.

What are the key threats to patent owners, and what is the best strategy if you suspect someone is infringing your patent?

Threats usually come from either blatant disregard of rights (eg, counterfeit products) or, by contrast, someone who is completely unaware of the existence of patent rights. In the first case strong action is recommended, including the involvement of Customs to seize goods. In the second case, often a notifying letter informing of the existence of a patent may be sufficient to have the infringing product withdrawn from sale. In all cases prompt and proportionate action is recommended with the aim of avoiding litigation.

Trademarks

How do you register or secure trademark rights and what protection does it grant?

By filing an application at the UK IPO, at the Community trademark office (OHIM), or by filing an International trademark designating the UK or Community. Registration gives the owner the exclusive right to use the mark for the goods/services that it covers in the UK. Protection may be available for unregistered marks under common law subject to the establishment of the necessary goodwill and reputation through trade in the UK under the trademark. The law recognises the concept of well-known marks.

What are the costs for registering a trademark and what are the costs of defending it?

A UK trademark in one class from filing to registration costs about £675 to £725 in a straightforward case. Each additional class included costs £150. A community trademark application in up to three classes from filing to registration costs £1,650 to £1,750 in a straightforward case.

Actions for infringement or passing off may be brought before the High Court or the IPEC. Hearings are before a single judge sitting without a jury. A High Court action could cost £150,000 to £300,000 up to and including full trial. Remedies available include damages for actual loss and injunction to stop continuing infringement. Costs are generally awarded to the successful party but recovery is usually limited to costs that are proved to be proportionate to the value of the case.

The IPEC is cheaper for smaller claims and has a cap on costs awards of £50,000 and maximum damages of £500,000. Low value and less complex claims can be pursued through a small claims track.

What are the key threats to trademark owners and what is the best strategy for dealing with infringement?

Threats to trademark owners usually come from either blatant disregard of rights (eg, counterfeits) or from online infringement or misuse of trademarks. In either case immediate and strong action is recommended, involving Customs or Trading Standards in the case of counterfeits.

In infringement cases prompt and proportionate action is recommended with the aim of avoiding litigation, eg, sending a cease and desist letter and obtaining undertakings. Alternative dispute resolution and settlement are encouraged.

What are the most common mistakes trademark owners make?

Owners often assume that registration gives them total freedom to use the mark rather than the right to stop others using the mark. Failure to police the mark actively is quite common as is failing to keep proper records, particularly in relation to how and to what extent a mark has been used.

Owners are also often reluctant to spend money on routine ‘housekeeping’ matters such as keeping the registers up to date, eg, with changes of name, address or changes of ownership.

Have there been any changes to the trademark law(s) in the last 12 months?

A fast-track opposition procedure was introduced which is cheaper and faster. Only straightforward cases are suitable because the grounds are limited. Proof of use of earlier marks registered for more than five years must be submitted when filing the opposition. Further evidence requires leave. The decision will be based on a comparison of the marks and goods/services. There is no automatic right to a hearing.

Counterfeiting

How big a problem is counterfeiting in your jurisdiction?

The import of counterfeit goods is an ongoing problem in the UK and the EU. Trade in counterfeit goods is estimated to cost the UK economy about £1.3 billion a year with about £900 million flowing to organised crime. In 2012 Customs enforcement in the EU resulted in almost 40 million articles detained.

What industries are particularly at threat?

The top categories of detained goods are cigarettes, alcohol, packaging materials, medicines, clothing, footwear, perfumes, cosmetics and electrical goods but products in every sector have been detained.

What are the best strategies for dealing with the problem?

Swift and robust action must be taken to maintain the prestige of a brand. Customs need the assistance of rights holders to police trade effectively. We recommend that an application to protect the client’s IP rights be filed with Customs. This ensures Customs notifies the rights holder of any detentions without delay.

The burden of proof rests with the rights holder to confirm that the seized goods are counterfeit and the time limits to take action are very short. It is important to have a technical contact who can quickly determine whether detained goods are counterfeit and a legal contact who can promptly communicate with Customs and the consignee. Unless the consignee responds, Customs will treat the goods as abandoned for destruction.

Copyright

What are the key challenges to copyright holders in your jurisdiction?

Unauthorised use of content online remains a major challenge to copyright holders. For example, illegal acquisition of infringing content through websites offering direct downloading, file-sharing or streaming is estimated to cost the UK audiovisual industries about £500 million a year in lost revenue.

How should people ensure they are protected against copyright infringement?

Keep accurate, dated records of the development of the work and assert copyright on it with the owner’s name and year of creation. There are many specialist organisations representing the rights of copyright holders who provide industry-specific advice and assistance.

What is the best way to deal with infringement?

Actions for infringement may be brought before the High Court or the IPEC. Hearings are before a single judge sitting without a jury. Remedies available include injunctions, damages and giving up of infringing goods. Deliberate infringement of copyright on a commercial scale can also be a criminal offence. Customs, the police and Trading Standards can investigate.

Have there been any changes to copyright law in the last 12 months?

No, but a number of changes to copyright law intended to make it better suited for the digital age will come into force on June 1, 2014. Information is available through the UK IPO website.

Alison Simpson is a partner at Urquhart-Dykes & Lord LLP. She can be contacted at: aefs@udl.co.uk

Mark Green is a partner at Urquhart-Dykes & Lord. He can be contacted at: mcg@udl.co.uk

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