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Unjustified Threats Bill comes into Force

On 1 October 2017, the IP (Unjustified Threats) Act 2017 came into force. This new legislation provides clarification on the law of threats, which was previously complicated and inconsistent across IP rights. These changes are aimed at preventing parties from unfairly threatening businesses with allegations of infringement. These changes also provide guidance on how to manage allegations of infringement, as well as how to allege infringement in a way which is justified.

What constitutes an unjustified threat according to the new legislation?

Section 21 of the Act states the following:

“A communication contains a “threat of infringement proceedings” if a reasonable person in the position of a recipient would understand from the communication that – an IP right exists, and a person intends to bring proceedings (whether in a court in the United Kingdom or elsewhere) against another person for infringement of the IP right by an act done in the United Kingdom, or an act which, if done, would be done in the United Kingdom.”

Essentially, the test is whether a reasonable person would understand that an IP right exists and that someone is intending to issue infringement proceedings for an act committed in the UK. If the communication satisfies this test, it will be treated as a threat and the threats provisions will apply.

What changes does the new legislation put in place?

  • The Act provides guidance on what can and cannot be communicated to a person or business when a party alleges infringement.
  • The Act encourages IP owners to openly communicate with the potential infringer in a less threatening manner. For example, IP owners are encouraged to give potential infringers notice of their IP rights as opposed to alleging infringement from the outset. This ensures that IP owners abide by threats provisions. It also allows IP owners to ascertain whether there has been an infringement and if so, who by, in a less aggressive manner.
  • The Act encourages IP owners to make a conscious effort to seek out the primary source of the infringement, as opposed to a person or business later in the chain. By actively searching for the source of the infringement (i.e. the manufacturer or importer) and ensuring all efforts are documented, this also provides IP owners with a defence to allegations of unjustified threats.
  • Guidance is provided on when a communication constitutes a threat under the new legislation.
  • The Act provides guidance on negotiating IP disputes and encourages discussion between parties as opposed to court proceedings.
  • In order to assist the relationship between clients and professional advisors, the Act now prevents personal actions for unjustified threats being brought against advisors. This helps to alleviate prospective difficulties or conflicts arising between clients and advisors and encourages businesses to seek professional advice from Patent and Trade Mark Attorneys.
  • Lastly, threats of infringement made under pending applications, may now be justified if the right is granted registration.

Our thoughts

The Act now brings trade mark and design threats provisions in line with those of patents. The Act also encourages dispute resolution over court action in the first instance which benefits all parties involved. It should be noted that uncertainty still revolves around other intellectual property rights such as copyright and passing off which were not covered in the new legislation.

If you have any questions or would like more information on these changes, please contact us at info@chapmanip.com.

 

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