Civil Justice Centre or the Rolls Building

The Civil Justice Centre in Manchester
Photo Wikipedia

Although the Chancery Division is very good at resolving big ticket disputes between multinationals it is not so good at resolving breach of confidence, copyright, design right, passing off and trade mark disputes between small businesses.  The costs of such litigation, even in the Manchester. Liverpool and Preston District Registries, often exceeds the value of the intellectual property right and sometimes the value of the proprietor's business.   In  "The Enforcement of Patent Rights" the Intellectual Property Advisory Committee reported that the average cost of an infringement claim was over £1 million in the High Court and between £150,000 and £250,000 in the Patents County Court compared to a maximum of €50,000 in France, Germany or the Netherlands (see the table on page 50).

The absence of a low cost forum for the resolution  of intellectual property disputes was seen as a disincentive to innovation and both Gowers and Hargreaves recommended the establishment of such a jurisdiction.   Lord Justice Jackson  made a similar recommendation in his Review of Civil Litigation Costs.  HM Government accepted Hargreaves and Jackson's recommendations and established a small claims track within the Patents County Court at the beginning of this month.   I and others have written extensively about this new court and you will find links to those materials at the end of my article "Patents County Court - the New Small Claims Track Rules" IP/IT Update 20 Sept 2012.

This new small claims track, which is in the Rolls Building in London, can probably handle many if not most of the intellectual property claims that have previously been brought in the chancery district registries and chancery county courts.   Any case other than one relating to patents, registered and registered Community designs, semiconductor topographies and plant breeders' rights can be brought in the small claims track provided that the damages sought do not exceed £5,000.  Since the remedy that most intellectual property owners want is an injunction against future infringement rather than damages or an account of profits for past infringement that is not a  problem.   Most intellectual property disputes are settled early either on undertakings  given in correspondence or after the claimant is granted or refused an interim injunction.   It is very rare for a successful claimant to insist on an account or an inquiry and very few settlements require the defendant to pay the claimant substantial damages.

The costs that can be recovered in the small claims track are very low:

The Rolls Building in London
Photo Ministry of Justice

• £260 if counsel or solicitors are instructed in relation to an injunction;
• the costs of issuing the claim form which vary from £30 and £120 depending on the amount of damages claimed; and
• loss of earnings and travelling expenses for attending a hearing.

Consequently, the risks of litigating in this court are correspondingly low.   No longer can a claimant with a valid claim be stymied by an application for security for costs.

The procedure of the new court is simpler than in the High Court or other county courts.  Disclosure is limited.   The strict rules of evidence do not apply.  Cross-examination is limited.   Anyone may represent a party even if he or she has no legal qualifications.   Five high calibre district and deputy district judges have been appointed to this new court.   They include former partners of Linklaters and Clyde & Co, the head of litigation at Nokia and the legal advisor to the Society of Authors.   Clearly the government expects the court to be busy.

This new court could be of enormous benefit to businesses in North West England.   To explain how it works and how to use it I shall be giving a presentation on the new small claims track to the Liverpool Inventors Club at the offices of QualitySolicitors Jackson & Canter at 88 Church Street, Liverpool, L1 3AY on 29 Oct 2012 at 17:00. Entrance is free but as space is limited admission is by ticket only.   You can book on-line or email or call Michael Sandys on 0151 282 1700 to reserve your place.   Although this presentation is designed for inventors and entrepreneurs there will be plenty to interest solicitors, patent and trade mark attorneys and members of the Bar.

If anyone wants to discuss this article he or she should call me on 0161 850 0080 or use my contact form. He or she can also contact me through Facebook, Linkedin, twitter or Xing.