Until July of this year, if you were a small business or young entrepreneur with limited resources and had the misfortune of having to enforce your intellectual property rights to prevent a breach of your rights, you'd be hard pressed to see the matter resolved in a timely and economical fashion. You may also not even be in a position to access recourse due to financial constraints.
For some time now, long processing times and high costs have meant that IP cases represented less than 0.5% of the cases determined by the Australian Federal Circuit Court (FCC). However, in a welcome change, the FCC now offers under-resourced litigants an alternative avenue to enforce their intellectual property rights quickly and cost effectively, via the new National IP Pilot Scheme.
Jurisdiction of Australian Federal Circuit Court
The FCC has jurisdiction to hear disputes relating to copyright, designs, trade marks, plant breeders' rights as well as associated consumer law claims. Its jurisdiction includes infringement matters, appeals from decisions of IP Australia and trade mark removal matters. Consideration is being given to expanding the Court's jurisdiction to include patent matters.
The FCC jurisdiction may be compared to the UK's Intellectual Property Enterprise Court, which was set up to reduce the costs of IP litigation for UK proceedings which are quicker, less complex and less expensive.
Australia's National IP Pilot Scheme
The IP National Pilot Scheme commenced operation in Australia on 1 July 2018 and is aimed at entrepreneurs, SMEs and young innovators. The FCC published a Practice Direction (No 1 of 2018 Intellectual Property) on arrangements for management of IP matters, which fall within one of the Court's National Practice Areas.
With the commencement of the IP National Pilot Scheme, all IP cases are being initially docketed to Judge Julia Baird, who was appointed to the Court earlier this year.
Judge Baird has over 25 years’ experience as a barrister specialising in IP cases, including 10 years as senior counsel with extensive experience in all fields of IP. She is highly regarded by the profession and her expertise has been recognised, including in Doyle's Guide, Chambers - Asia Pacific Guide and the World Trade Mark Review.
Judge Baird recently presented to the profession on the National IP Pilot Scheme and encouraged Australian practitioners to utilise the FCC in order to achieve prompt, cost effective and sound determination of IP disputes, particularly for less well-resourced litigants.
The FCC's jurisdiction in IP matters is concurrent with the Federal Court and cases may be transferred to the Federal Court at the request of a party or of its own motion.
The FCC has the power to make orders for declarations and injunctive relief and award damages or an account of profits.
There is no limit on the amount of an award of damages/account of profits/additional damages for IP matters, but there is a limit of $750,000 for damages awarded in consumer/Trade Practices matters.
Urgent relief (such as interlocutory injunctions, Anton Piller orders and Norwich Pharmacol relief) may be sought if urgent relief is required in infringement matters.
Recent IP cases
Recent IP decisions of the FCC have involved diverse subject matter such as:
• Infringement of copyright in racy pictures used in a Twitter account
• Sale of counterfeit G-STAR apparel
• Infringement of the X-POLE trade mark by the sale of inferior copies of pole dancing poles
• Unauthorised use of a photograph of a Hawaiian beach to promote an Australian travel business
• Misleading or deceptive use of GO GET CABS trade mark
• Infringement of copyright in Microsoft programs
• An appeal in relation to IP Australia's decision regarding an opposition to the mark ALKAVIVA
Remedies awarded in such cases have included declaratory relief, injunctions to prevent infringing conduct, damages for lost sales, damages for damage to reputation, additional damages (of up to AU$300,000).
As stipulated in the Practice Direction, directions will be made by the Court with regard to case management so as to bring the proceeding to trial in a manner which is proportionate to:
• The nature of the dispute
• The financial position of the parties
• The complexity of the case
• The importance of the case
• The amount of money or issues in dispute
Parties will be actively encouraged to streamline cases by:
• Limiting claims to grounds with the best prospects of success
• Limiting the number of witnesses
• Limiting opening and closing arguments or reducing them to written form
• Consenting to a trial on the papers where appropriate
• Using junior counsel (who charge lower rates)
Mediation of IP matters will be handled by Registrars of the Court or by private mediators with the consent of the parties.
The first case management hearing of IP cases will be fixed for a date within 3 weeks of the issue of proceedings and the Court will aim to fix cases for hearing within about 8 months.
The FCC aims to limit the duration of hearings to no longer than 2 days.
Decisions will be handed down within a month or within a week for urgent matters.
This time frame represents a significant improvement on usual time frames experienced in the Federal Court of Australia where delays of up to 2 - 2.5 years in the hearing and determination of IP cases are common.
The FCC's fees are about a third of the comparable Federal Court fees, making it more accessible to under-resourced parties.
Pursuant to Rule 21.03 of the Federal Circuit Court Rules the Court may specify the maximum costs which may be recovered on a party and party basis and the Practice Direction states that it is expected that this provision will be frequently used for cases in the IP list.
The shorter duration of proceedings (including the trial) will also result in considerably lower costs for litigants.
Insights from the Bar
We've asked for the thoughts of two senior barristers, both with extensive IP expertise, who told us:
"The IP Pilot Scheme gives rise to exciting times tasking Judge Baird with the mission of driving the case management of IP cases in the Federal Circuit Court." Tom Cordiner QC
"The unfortunate reality is that the Federal Court is under-resourced and is taking over 12 months to issue some judgements in IP cases. Practitioners can take advantage of issuing proceedings in the Federal Circuit Court to take advantage of the fact that the Court should have lots of capacity at this time to deal with cases expeditiously." Ed Heerey QC
What the Future Holds
Litigants wanting speedy and cost-effective adjudication of their IP dispute should now feel more confident in commencing proceedings in the FCC with the knowledge that a well-regarded specialist judge has been appointed to take charge of the IP list. It is hoped that SMEs, entrepreneurs and young innovators will now have a speedy, accessible and cost-effective option to enable them to enforce their valuable IP rights.