14 October 2012

How Small Businesses in Yorkshire can protect their Intellectual Property

The Patents County Court Small Claims Track from Jane Lambert

I have spent most of my career at the intellectual property bar championing small and medium enterprises in the North of England.  Until very recently I would encourage their solicitors and patent and trade mark attorneys to issue proceedings in the Leeds or some other Chancery District Registry unless the claim related to patents, registered or registered Community designs, semiconductor topographies or plant breeders' rights.   The reason I did that is that is that the chancery judges in Leeds have been every bit as good as those in the Royal Courts of Justice - at least since Richard Scott was appointed Vice-Chancellor - and it is nearly always cheaper and more convenient for a business owner and his solicitors in Yorkshire to litigate in Leeds than traipse down to London.

Nearly all these cases were claims for injunctions and in almost every case the action was settled on undertakings or when the claimant obtained or was refused an interim injunction.   In very few of those settlements did the defendant agree to pay any damages at all to the claimant.   In the few cases where he or she did so agree, those damages seldom exceeded £5,000.   It is very rare for an intellectual property claim to go to trial and rarer still for there to be an account of profits or inquiry as to damages.   Indeed, I have had only one brief for an inquiry and that took place in London before Master Bragge.

It follows that many, if not most, of those cases could have been brought before the small claims track of the Patents County Court had it existed at the time.   That jurisdiction has power to grant injunctions and other relief in any intellectual property claim provided that the claim for damages is less than £5,000 except claims involving patents, registered or registered Community designs, semiconductor topographies and plant breeders rights which must still be brought in the Patents Court or the multitrack of the Patents County Court. Thus the small claims judges could hear claims by an inventor against a prospective licensee or investor for the breach of a non-disclosure agreement, an established trader against an upstart competitor who has adopted a similar trade name and labelling or a small manufacturer whose nifty merchandise has been knocked off.

The costs that can be recovered in the small claims track are very low:   up to £260 if counsel or solicitors have been instructed in relation to an injunction plus the costs of issuing proceedings which ranges between £35 and £120 depending on the amount of damages sought and compensation for travelling and loss of earnings for attending a hearing.   Accordingly, the risks are very low which means that intellectual property owners cannot be stymied by security for costs applications.   The procedure has been simplified in that there will be limited disclosure, the strict rules of evidence are relaxed, evidence need not be given on oath, cross-examination can be limited and anyone can represent a party at a hearing even if he or she is not qualified as a lawyer or patent or trade mark attorney.   Indeed, many cases are likely be disposed on on paper.

The Ministry of Justice has appointed no less than five district judges and deputy district judges to this new small claims track of a very high calibre, including the head of litigation of a mobile phone manufacturer, the legal adviser to the Society of Authors, a former partner of Linklaters and a former partner of Barlow Lyde & Gilbert (now Clyde & Co,).   Clearly, the Ministry expects the court to be busy and by the quality of its appointments it has shown that it means business.   As counsel I have great confidence in all of those judges.

So, how do you or your solicitors use this new tribunal?   I gave a brief guide in the above presentation to Sheffield Inventors Group on 1 October 2012 which you can download.   If you missed it I shall give the same presentation again to the Liverpool Inventors Club at the offices of QualitySolicitors Jackson & Canter at 88 Church Street in Liverpool on 29 October at 17:00.   If you want to attend you can book on-line or call Michael Sandys of QualitySolicitors Jackson & Canter on 0151 282 1700.   Admission is free but as space is limited you will need a ticket.

If you don't want to negotiate the M62 or the start of the Merseyside rush hour here is a step by step guide as to what to do:

  1. Ask the other side nicely to stop whatever they are doing.   You need to send a letter before claim in accordance with Annex A of the Practice Direction - Pre-Action Conduct.  You must be careful how do that otherwise you could end up getting sued yourself for groundless threats as indeed could your solicitor if he does not know much about intellectual property. I kid you not.  I have given some guidance as to how that can be done in "IP Dispute Resolution in England and Wales: why sending a US style “Cease and Desist Letter” or old style “Letter before Action” may not be a good idea" JD Supra 13 Jan 2012 and I have even drafted a model letter before claim for a design right dispute.  You are likely to be better off getting a barrister, solicitor or patent or trade mark attorney to draft such a letter for you and I will do one for you or your solicitor for a fixed fee if you want to get in touch. You are likely to be even better off if you get a specialist solicitor to put it on her notepaper and, if you don't have a specialist solicitor in Yorkshire, Kate Reid of Pemberton Reid sends letters drafted by me on her stationery for an extra £100 + VAT.  I have arranged with solicitors and patent and trade mark agents in other parts of the country to offer similar deals to my clients.
  2. Issue your claim form out of the Rolls Building    A claim form is what we used to call a writ and blank forms can be downloaded from HMCT Service website or obtained from the Court. You have to issue it out of the public counter of the Rolls Building off Fetter Lane in London and pay the fee that I mentioned above.   The claim form must be accompanied by particulars of claim which should set out your claim in detail.  In addition to specifying your right, how it has been infringed and the remedy you require you must say that you have complied with the Practice Direction - Pre-Action Conduct and that you want this case to proceed in the small claims track.   Again, this is tricky and you main need some help.   Again, I am happy to settle particulars of claim for a fixed fee if you would like to contact me,   You must then serve the claim form with the particulars of claim and a response that on the other side or get the court to do it for you.   It is very important that you serve all the paperwork or you case will stall and any order or relief that you may be granted will be set aside.
  3. Wait for the other side to respond.   They have a fixed time to lodge their defence and any counterclaim against you the duration of which will depend on whether you complied with the Practice Direction.   If they don't lodge their defence in time you can apply to the court for judgment in default of defence which will probably require a hearing if you want an injunction.   If they do respond in time the court will give directions which may include fixing a date for a final or a preliminary hearing.   You must comply with all the directions of the court within the time specified if you want to get into or remain in the judge's good books.    
  4. Attend the Hearing    Unless the judge has indicated that your case is suitable to be disposed of in writing and everyone has agreed you must attend the hearing which will take place in the Thomas Moore Building in the Royal Courts of Justice which is a few hundred yards from the Rolls Building.   The judges of the Patents and Patents County Court have said in their guide that they will sit in London for the convenience of the parties and to save costs but I have only known a few occasions when they have done so.   You should have enough notice of the hearing to book a saver ticket and a Travelodge so it is hardly going to break the bank if you go to London and you should get some of your dosh back if you win.   Also, you and your Mrs. (or hubby) can combine a trip to the court with a visit to some of the other attractions that the Smoke has to offer.
If you want to learn more about this small claims track there is loads of info including links to my other articles and other guidance at "Patents County Court - the New Small Claims Track Rules" 20 Sept 2012 in my IP/IT Update blog.   You can also give me a bell on   0113 320 3232 begin_of_the_skype_highlighting            0113 320 3232      end_of_the_skype_highlighting or send me a message through Facebook, Linkedin, Xing or twitter or indeed my contact form.