Intellectual Property (Unjustified Threats) Act 2017- A legal update.

16 May 2017

Author: Peter Guzhar
Practice Area: Intellectual Property

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Current law

Under Section 70 of the Patents Act 1977 (the ‘PA’), an aggrieved party (whether or not he is the person to whom the threats are made) may seek a remedy (such as a declaration that a threat is unjustifiable, an injunction on the continuance of a threat or damages for loss sustained by a threat) where groundless threats have been made in relation to infringement proceedings.

The ‘threat’ of proceedings for infringement of a patent does not need to be made only by the proprietor of, or anyone entitled to any right in, a patent. This means that even legal advisers who may send a letter threatening proceedings are not immune from litigation proceedings being brought against them.

The onus is on the Defendant to prove the acts complained of, if done, would constitute an infringement of a patent and that the patent alleged to be infringed is not shown by the Plaintiff to be invalid (the ‘justification defence’).

The same remedy is also available under Section 21 of the Trade Marks Act 1994.

Present Parliamentary position

The Intellectual Property (Unjustified Threats) Bill received Royal Assent on 27 April 2017. The Bill implements the Intellectual Property (Unjustified Threats) Act 2017 (the ‘IPA 2017’), of which the main operative provisions are yet to come into force.

The IPA 2017 is written to encourage parties to negotiate fairly over intellectual property disputes whilst attempting to protect those who can be most harmed by unjustified threats to sue for infringement and attempts to harmonise intellectual property legislation to cover threats in relation to trade marks, designs and patents, all in one piece of legislation.

Summary of major changes

The IPA 2017 provides clarification as to what constitutes a ‘threat of infringement proceedings’ and also provides for ‘permitted communications’. Interestingly for practitioners the IPA 2017 provides a new protection to professional advisers in that proceedings in respect of an actionable threat may not be brought against a professional adviser, provided they are making the communication on the instruction of another person and when they make the communication they identify that person.

The IPA 2017 further amends the justification defence so that a person cannot obtain a remedy if the relevant IP right is shown to be invalid. This provision provides some comfort to a party issuing a threat to prevent unnecessary proceedings even if it is later established no valid right existed.

A link to the new legislation can be found here: http://www.legislation.gov.uk/ukpga/2017/14/contents/enacted.

We will provide a further update when all provisions have been enacted and if you have any queries please do not hesitate to contact Peter Guzhar.

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