The Government has now issued its response to the Law Commission's draft Intellectual Property (Unjustified Threats) Bill, endorsing the approach taken by the Law Commission in its report of October 2015. 

Summary

The Government's Response (issued on 28 January) has approved the drafting of the Bill, and the approach taken in the Law Commission's report, to harmonise the law on threats actions in trade mark and design law with that already present in patent law, as well as the adaptation of the threats regime to accommodate threats of infringement of patents that will be under the jurisdiction of the new Unified Patent Court (unitary patents and non-opted out European patents) once the UPC is established (likely to be 2017 – see www.hsf.com/upc  for more information), the new criteria for jurisdiction in threats actions being a threat in relation to any act within the UK, rather than of proceedings in the UK courts. This amendment was required since the UK local division and seat of the central division of the UPC, although located in London, will not be UK courts.

Changes to allow more certainty in respect of what sorts of communication are non-threatening have also been included in the Bill. 

See our discussion of the Bill at our annual IP Conference on 26 January here, our article "Don't fret about threats" for Managing Intellectual Property Magazine February 2016 which covers the law on IP threats in Australia (contributed by our Australian IP practice), Canada, the US and Germany, as well as the UK.  

The Government's report expects the draft bill: The Intellectual Property (Unjustified Threats) Bill (as appended to the Law Commission's October 2015 report) to become law in its current form (but note the retention of "best endeavours" defence instead of proposed "all reasonable steps" – see below). It is expected that the Bill will be expedited using special Parliamentary procedures for measures deemed uncontroversial, in particular those emanating from the Law Commission. 

Business Impact

The main changes that will be introduced by the new Bill:

  • When the Bill becomes law, you will be able to ask secondary infringers about details and the source of infringing products and the identity of primary infringer in relation to infringements of UK and the Community trade marks, registered designs and unregistered designs, as well as patents (national patents, European patents and unitary patents) without the risk of a threats action, as long as you have used "best endeavours" to find the primary infringer (currently this is only in respect of patents) and have notified those steps to the secondary infringer. The Government has concluded that the Law Commission's proposal to change this to having taken "all reasonable steps" was unnecessary) to find the primary infringer
  • "Permitted communications" for "permitted purposes", as set out in the Bill, will be deemed not to be threatening (as long as no explicit threat is made)
  • Threatening any primary infringer with proceedings for secondary acts will be exempt from the remit of a threats action for Community and UK trade marks, registered and unregistered design rights, not just UK and UK designation European patents, as currently (and of course unitary patents in due course)
  • The UK courts will have jurisdiction in relation to threats actions with respect to threats of proceedings relating to an act in the UK (not limited to threats of UK Court proceedings so includes threats of proceedings in relation to infringement of unitary patents and non-opted out European patents which will be heard in the UPC)
  • Professional advisers will no longer be liable for unjustified threats as long as they make it clear whom they are acting for in the "threatening" communication  

But note:

  • There is still no resolution for other IP rights (risk of actions for unlawful interference with trade and other torts)
  • There will still be a complex series of hoops to jump through and a broad assessment
  • It may still be difficult to fulfil CPR obligations completely (see the slides for more on this)

Despite the "safe harbour" provisions setting out what communications are permitted and will not be threatening (if no explicit threat is made within them), this new legislation could actually lead to more use of the threats provisions (partly by highlighting their availability) and may make pre-action communication, as required by the CPR, more difficult rather than less so.  Several judges commented during the consultation process that the Law Commission's approach of "evolution" rather than "revolution" was an opportunity missed to create a more general tort of false allegationsto use against the obvious abuse of rights, which could also have applied to all IPRs equally.

For more on the current and future law on actions for unjustified threats of infringement of intellectual property rights (including rights not covered by statutory provisions) see

  • Our IP conference presentation linked above (and here), 
  • our previous IP e-bulletin on the Law Commission's October report and draft bill; and  
  • our article "Don't fret about threats" for Managing Intellectual Property Magazine February 2016