The Patents County Court (Financial Limit) Order 2011 creates a clearer definition of what disputes can be heard in the PCC and which ones should go to the High Court. Previously, a business with a legal case worth less than £500,000 could face litigation in either court with unknown levels of financial risk.
The change in law will ensure that lower value, less complex cases, which would typically involve small businesses, will automatically fall within the jurisdiction of the lower, cheaper PCC. Therefore the risk of having costly disputes over where the case should be heard will be reduced. In the past some companies were put off protecting their rights due to the uncertainty of how much it would cost.
Minister for Intellectual Property, Baroness Wilcox said:
“Maintaining an effective and efficient intellectual property framework for businesses is not enough to drive innovation. We must offer businesses a more accessible justice system for them to enforce their rights. By making it easier for small firms and entrepreneurs to use the legal processes it will give them more time to concentrate on business activities.
“These changes will help small businesses and encourage them to innovate. It will also provide clarity over the legal processes, certainty over the risks and give small enterprises the confidence to stand on an equal footing with financially stronger companies.”
Support for the limit was expressed by small and medium sized businesses during a full public consultation on the reform of the PCC. The effectiveness of the damages cap will be monitored with a formal review in 2014.
Work is now underway to expand the law further so the damages cap will cover cases of copyright and trade marks in the PCC.
Notes to editors
- The Intellectual Property Office (IPO) is within the Department for Business, Innovation, and Skills (BIS) and is responsible for the national framework of Intellectual Property rights, comprising patents, designs, trade marks and copyright.
- Its role is to help manage an IP system that encourages innovation and creativity, balances the needs of consumers and users, promotes strong and competitive markets and is the foundation of the knowledge-based economy.
- It operates in a national and an international environment and its work is governed by national and international law, including various international treaties relating to Intellectual Property (IP) to which the United Kingdom is a party.
- The Patents County Court (Financial Limit) Order 2011 becomes law through section 288(5) of the Copyright, Designs and Patents Act 1988 and has been implemented following a report by Lord Justice Jackson on his review of Civil Litigation Costs on 14 January 2010. One of the proposals was to reform the Patents County Court. An order to introduce the damages cap for cases involving patents and designs was debated in the House of Lords on 28 March 2011 and in the House of Commons on 3 May 2011. The order becomes law on 14 June 2011.
- The Central London County Court is designated as a Patents County Court.
- The limit does not remove existing options for any SME, which includes filing a claim in the High Court. Implementation adds further possibilities to any potential IP litigation strategy for all SMEs including those in the high tech business sectors. With the exception of point 3 below, which is already available, the following scenarios will be possible once the relevant measure comes in to force:
A claimant may abandon any excess claim above the limit of damages; in which case a Patents County Court shall have jurisdiction to hear and determine the action, but the claimant may not recover more than that amount (CDPA s288(2)).
If the parties agree that a Patents County Court shall have jurisdiction in any proceedings, that court shall have jurisdiction to hear and determine the proceedings notwithstanding any limit imposed under section 288 (CDPA s288(4)).
A claimant may still seek to have the case heard under the Streamlined Procedure (Patents Court Guide para 8.6) in the Patents (High) Court.
Notes to Editors
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