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Unjustified threats

Intellectual property owners have always had to tread carefully when it comes to enforcing their rights.  Until recently, part of the law known as the unjustified threats provisions meant that it was possible for someone on the receiving end of threatened proceedings for patent, design right or trade mark infringement to issue their own proceedings to ask the court to issue a declaration that the threats lacked justification, to make an award of damages and to issue an injunction to prevent further threats being made. For obvious reasons, this could act as a powerful disincentive to trying to stop what might be seen as infringement where the position was not absolutely clear. Added to that was the fact that lawyers sending a letter alleging infringement could also be separately liable for doing so – the playing field was far from level.

The provisions were meant to stop innocent consumers and retailers, known as secondary infringers, from being faced with infringement claims. The idea was a good one but over the years the unjustified threats provisions have been used by primary infringers (i.e. those making or importing the infringing goods) trying to obtain a tactical advantage. To make matters more difficult, the regime was an unwieldy mix of various legal concepts and remedies which led to a lot of uncertainty amongst lawyers and businesses alike.

The Intellectual Property (Unjustified Threats) Act 2017, which came into force last week, is meant to address these issues. It provides some much-needed clarity.

No longer can an intellectual property rights owner be considered to be making a potentially unjustified threat simply by telling someone that they own a particular trade mark, which could have been the case before. That is now specifically permitted, as is giving another party notice that you have rights under a certain mark. The Act also means that a trade mark owner, for example, can demand that a primary infringer (i.e. someone who is importing goods which infringe a trade mark) does not sell those goods.  Slightly bizarrely, before the Act came into force that was something which could land a trade mark owner in hot water.

Just as importantly, especially for the lawyers, a threats action cannot be brought against a legal adviser acting on instructions where the identity of the client has been included in correspondence.

The aim of those who drafted the Act was to encourage parties to try to resolve disputes before issuing proceedings. It has been a long time in the pipeline but at first glance, it seems that it may well have that effect.

 

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