The Intellectual Property (Unjustified Threats) Act, 2017

Under UK law, there are provisions governing the making of threats concerning intellectual property (IP) infringement. Under certain circumstances, persons aggrieved by groundless threats of action for infringement of patent, trade mark or design rights can sue the person making the threats. For example when the owner of the IP rights threatens a competitor’s customer, the competitor could potentially sue the IP owner if the threat is unjustified.

The existing UK provisions governing unjustified threats have been criticised for being awkward, not least because they differ between patents, trade marks and designs. It can be problematic for IP rights holders to make reasonable enquiries to identify the source of infringing goods. The existing provisions can also be subject to tactical misuse to gain advantage on either side of an IP dispute.

On 15 April 2014, following consultations, the Law Commission published its report on potential amendments to the groundless threats provisions for patents, trade marks and design rights. The Intellectual Property (Unjustified Threats) Act, 2017, received royal assent on 27 April 2017 and will come into force from October 2017.

The main aim of the Act is to provide a clearer and more uniform set of provisions that apply across patents, trade marks and designs. The changes will hopefully ensure that parties act reasonably in the initial stages of potential IP disputes. The key features are:

• A test to determine whether a communication constitutes a threat based on whether a reasonable recipient would understand from the communication that an IP right exists and there is an intention to commence infringement proceedings in respect of an act done, or to be done, in the UK.

• A “safe harbour” such that rights holders and those who act for them can communicate with others for certain permitted purposes without the risk of being subject to action for an alleged implicit threat (eg to track down the source of infringement or to inform the recipient of registered trade mark rights so as to remove a defence of innocence). The rights holder must have reasonable grounds for believing that the information communicated is true.

• An exclusion to the recipient bringing an unjustified threats action for a communication referring to specified acts that would, if done, amount to manufacture or importation.

• A provision to remove the threats liability for lawyers, registered patent attorneys and trade mark attorneys when acting in their professional, regulated capacity and on clients’ instructions.

• Two statutory defences being available to a person who is sued for making threats by an aggrieved person, the first, being to show that the threat is justified. The second defence is to show that “reasonable steps” had previously been made, without success, to identify a primary infringer and had been notified to the aggrieved person.

The full version of the IP (Unjustified Threats) Act can be found here