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Law Commission Report On Groundless Threats

Law Commission Report On Groundless Threats

As you might be aware, yesterday, the English Law Commission published their long-awaited report on their proposals to reform the tricky area of groundless threats in the UK.  The full report can be found here.

I think we would all agree that the inconsistencies between the groundless threats provisions for patents, trade marks or designs are a minefield for practitioners.  As the report states, a practical consequence of this uncertainty is that the risk of facing costly litigation may prevent a small enterprise from asserting its intellectual property rights where these have been infringed by a larger competitor with greater resources.

The aim of the reform is to harmonise these provisions as they apply in the UK, regardless of what type of IP is being considered (other than the existing types to which the rules do not apply e.g. copyright, and passing off).  In 2014, the Law Commission made 18 recommendations (which are summarised in Appendix B of the report).  

Some of the more noteworthy recommendations from the 2014 Report include:

  • An exception for threats made to “primary infringers”.  This is already the position with respect to patents, following the Patents Act 2004 but this extension to threats as they apply to trade marks and designs (both registered and unregistered) is to be welcomed.
  • Removal of liability for professional advisors.  This was always an area that seemed particularly difficult for solicitors and attorneys.  Often recipients of threats would threaten the advisor of someone alleged to have made a threat, purely as an attempt to drive a wedge between advisor and client.  This change is to be welcomed and is certainly long overdue!
  • Reasonable enquiries can be made to “secondary infringers” for the purpose of discovering if and by whom the IP right has been infringed.  All communications to such “secondary infringers” require to have a legitimate commercial purpose.  It can often be very difficult to identify who the “primary infringer” actually is.  This reform provides a welcome extension to the current provision and also seeks to ensure that any communications to “secondary infringers” are issued in a reasoned and sensible manner.

The 2015 Report has also makes two further recommendations.  These are:

  • That Section 70 of the Patents Act 1977 should apply to Unitary Patents and to European Patents (UK) that have not opted out of the jurisdiction of the Unified Patent Court.  The Commission explain that this change has been introduced as at the outset of their project, the implementation of a Unitary Patent court and precisely how it would be regulated seemed a long way off.  
  • That a new test for whether a communication can be considered a be introduced.  The new suggested test is whether a reasonable person in the position of the recipient would understand from the communication that a person has a right (in any of a Unitary Patent, European Patent (UK) or national patent, Community or national trade mark, Community registered or unregistered design or national registered or unregistered design) and intends to bring proceedings against another person for infringement of one or more of those rights by an act done in the UK, or an act which, if done, would be done in the UK.

Again both recommendations seem entirely sensible.

There is perhaps some frustration that wider reform has not occurred which would see harmonisation throughout the EU in this area. Presently, advisors are left to consider whether or not they should seek local advice on the threats provisions in a certain jurisdiction, before issuing letters.  The UK and Republic of Ireland are very much out of step with the rest of the EU on this area. However, the current proposals are at least a step in the right direction.

Neeraj Thomas
Associate

LChalmers