Costs for intellectual property rights soar - You need Insurance!

The Financial Times reported on 27 September 2015 that it seems unfair that it costs somewhat less to launch new projects into space, yet billions are invested in order to protect intellectual property rights in the modern era.

The price of funding the International Space Station is approximately 100 billion euros. In comparison with the $20 billion cost for the smartphone industry to protect numerous patents so that they can protect their innovative technologies.

The Hargreaves Report in 2011, which was initiated by the UK Government, warned that innovations were being stifled due to the various types of intellectual properties becoming overlapped with one another.

Academics from the London School of Economics totalled the cost of patent litigation for both claimants and defendants at between £1m and £6m in 2012 and they say they are continuing to rise. It has emerged that the UK Government plans to double the fee for issuing claims at court, the second increase in 12 months. The Law Society also adds that this will deter small businesses from defending their rights to intellectual property.

The figures are misleading and not reported in context. They only take into account High Court Litigation and complex patent cases. They do not reflect the Intellectual Property Enterprise Court where claims are simpler and most carried out under the £50 000 limit for costs recovery. They also don't take into account the Small Claims Court issues for low value copyright, unregistered design and trade mark infringement.

The Federation of Small Businesses say that a quarter of British companies have suffered some kind of infringement of their intellectual property rights in the past five years. It is said that almost a third choose not to litigate for financial reasons.

The answer in part is to invest in an insurance policy which will cover the costs of litigation. If you are an A©ID member you can take advantage of their lower cost policy which will pay for claims brought in the Intellectual Property Enterprise Court. Yes you pay a premium but it is cheaper than paying the whole amount of your fees if a claim is made.

The advice is de-risk your business and make sure that you have IP insurance in place.

For further details contact Niall Head-Rapson at nhr@mcdanielslaw.com.