The United Kingdom’s new Intellectual Property (Unjustified Threats) Act 2017 (the Act) was recently granted royal assent and is set to come into force in October 2017. The Act should make it easier to advise clients, avoid litigation and facilitate the negotiation of settlements by outlining what types of threats are unjustified. The Act will also harmonise the UK law on unjustified threats across patents, trade marks and design rights.
Currently, the law allows those accused of infringing intellectual property to sue for damages if threats of legal action against them are revealed to be groundless. This can lead to rights-holders becoming wary of challenging perceived threats to their intellectual property because they do not want to risk their threats being perceived as groundless and, as a result, do not exercise full protection of their intellectual property rights.
What constitutes a “threat” will be defined in secondary legislation, but the Act will increase the current territorial scope of the threats. Currently, a threat can only relate to a communication involving a threat of action specifically in UK law, but this will be modified to cover threats in regard of “acts” done in the UK. This will increase options for worldwide rights-holders when seeking to protect their intellectual property.
The Act will further clarify how and when threats of proceedings for infringement can be made by introducing levels of infringement. In addition to primary infringers, i.e. individuals who are being accused of directly infringing an existing intellectual property right, it will now be possible to threaten proceedings against secondary infringers who are those accused of acts such as distribution of infringing items.
The Act will also create a safe harbour for certain communications to secondary infringers, allowing rights-holders to carry out investigatory work into acts of primary infringement without worrying that such communications could be regarded as unjustified threats for which they could be sued.
There will be a new exemption introduced for professional advisors, ensuring that an advisor will not be personally liable when making a threat after being instructed to do so by their clients, and this is clearly stated in the communication.
Once the new law comes into force, it should encourage more open communication and negotiation between parties and help to reduce cases of rights-holders commencing litigation without notice in order to avoid the risk of being sued for making unjustified threats.