Intellectual property (IP) disputes may take several forms, including infringement of IP rights, misappropriation of business goodwill and reputation, industrialespionage such as stealing a competitor’s trade secret, unfaircompetition such as counterfeiting and false advertising, orbreach of an agreement to use IP, among many others.
Traditionally, IP disputes have been brought before a court. But in recent years, alternative dispute resolution (ADR)has emerged as an increasingly attractive option for resolvingsuch disputes, as parties may wish to avoid court litigation.
Arbitration is a form of ADR that provides a private andconfidential procedure to resolve disputes involving IP. Parties may choose arbitration in advance through contractual arrangements or may decide after a dispute arises thatarbitration should be pursued as an alternative to conventional litigation. Courts of many countries, including theCentral Intellectual Property and International Court ofThailand, offer court-sponsored, nonbinding arbitration asa method of decreasing their caseloads. The arbitrationproceedings may include fact-finding, document exchange, briefing and testimony of witnesses, etc. Arbitration awardsor the arbitrator’s decisions are legally binding on theparties to the dispute and are subject to judicial review onlyin extremely limited circumstances.
Arbitration has several advantages over court litigation:
• Confidentiality. The privacy of arbitration is attractiveto parties who may not want to reveal the proceedings to thepublic. Arbitration sessions are not open, and the arbitrator’s decisions are not released to anyone except the parties.
• Structure. The parties generally agree to arbitration and are free to further agree to specialized rules and to choosearbitrators with experiences, skills, and expertise suitablefor the matter.
• Procedures. Unlike the one-size-fits-all procedural rulesin court litigation that are applicable to all cases, in arbitration the parties will choose actions that best serve theirinterests, including the applicable law, rules and procedures, and the place and language of the proceedings.
• Specialized expertise. The parties may select a panel ofarbitrators who possess a particular expertise suitable toresolve the complicated and technical nature of disputesinvolving IP. In complex technology disputes, for example, the selected arbitrators could have deeper understandingabout the technology involved than a judge without a scientific or technical background.
• Efficiency. As a result of the parties’ autonomy, arbitration typically provides a faster and more efficientdecision-making process than court litigation. In many cases, arbitration has proven to be cheaper than court litigation.
• Relationships. Arbitration proceedings are conductedin a friendlier manner than typical litigation, usually inprivate setting. Rules of evidence and procedure as selectedby the parties from the arbitration rules are generallyrelaxed, which makes the process more business-like andless hostile than court litigation. The ADR process allowsthe conflicting parties to restore their working businessrelationship.
• Enforceability. The enforceability of arbitration awardsis recognized by national statutes. Treaties like the UnitedNations Convention for the Recognition and Enforcementof Foreign Arbitral Awards of 1958 (the New York Convention) provides for the common recognition of arbitralawards. Since grounds for appeal are very limited incontrast to court litigation, arbitration decisions are oftenviewed as easier to enforce than judicial decisions.
Unless the parties to the dispute aim to establish a publiclegal precedent rather than an award, arbitration and otherforms of ADR can provide an effective means to deal withpossible future conflicts. Practitioners, judges, legislators, and academics should pay more attention to the potentialvalue of arbitration and should present arbitration to theparties as an alternative means to the court litigation forresolving IP disputes.