Government Threatens to Crack Down on Groundless Threats

On 13 October 2015 the Law Commission for England and Wales published the final report on the project to reform the law of unjustified threats in relation to legal proceedings for patent, trade mark or design right infringement. The news is seen as a step in the right direction for small and innovative businesses who may be significantly set back commercially as a result of groundless threats to sue for intellectual property (IP) infringement. Groundless threats can result in innocent businesses being forced to spend considerable time and expense establishing whether the IP rights claimed have been infringed or are even valid in the first place.

The Law Commission's first report was published in 2014 and prompted a media release from the UK Government earlier in 2015 stating that it would "improve protection to make sure businesses are not exposed to unnecessary and bareless accusations". The report highlighted a number of reform areas, including making threats provisions much clearer, making it easier for parties to resolve disputes in good faith and pre-litigation, and preventing legal action.  Intellectual Property Minister Baroness Neville-Rolfe commented at the time:

"We are improving protection against the groundless threats of intellectual property infringement that small businesses can face. Our reforms will make sure that law properly protects businesses from being threatened unfairly, but also allow innovative businesses to resolve disputes legitimately and enforce their rights".

The IPKat observed that whilst the drafted Intellectual Property (Unjustified Threats) Bill addresses Patents, Trade Marks and Designs, there are various IP rights not covered, including for example copyright and trade secrets, and suggested that there is more work to be done in this area. However, the Government did not expressly rule out wider reform in the long term in its response to the Law Commission suggestions which put forward this possibility.