Unjustified Threats Act: key changes to the old law
14 December 2017
The new Unjustified Threats Act came into force on 01 October 2017. The aim of the Act, which applies to “threats” after this date only, is to make the law consistent across all relevant IP rights and help businesses avoid litigation, if possible. The old law often had the effect of deterring parties from settling disputes through negotiation before litigation because they did not want to risk threatening a potential infringer. This was particularly so in areas other than patents.
Consistency between all forms of IP rights
The principal objective of the Act is to bring other intellectual property rights (trade marks, registered designs and unregistered design rights) in line with the provisions already in place for patents. The Act provides that threats in respect of primary infringements or to a primary infringer generally are no longer actionable, as has been the case for patents for some time.
In addition, it is now a defence in relation to threats made concerning all relevant IP rights to use “reasonable steps” to identify a primary infringer before threatening a secondary infringer. This will apply provided the threatener inform the party being threatened as to what those steps were. This is a slight change from the previous provisions concerning patents, now amended, which required “best endeavours”.
Changes to previous validity defences for patents
Under the old law, if a threat was made in respect of a patent and the patent was shown to be invalid, the patentee would have a defence to a claim of unjustified threats if the patentee was able to prove they didn’t suspect that the patent was invalid at the time of the threat.
This defence has been repealed because it is felt that, because the rightsholder is best placed to evaluate validity, it should bear the risk in this regard.
Considering whether or not a communication contains a threat
Previously, for a communication either oral or in writing to constitute a threat it had to be understood by a recipient as being a threat to bring proceedings in a UK court. The Act modifies this such that it relates to whether the communication would be understood by a recipient to mean that someone intends to bring infringement proceedings in respect of the relevant IP right for an act done or intended to be done in the UK.
This change was made to take into account the unitary patent (UP) and Unified Patent Court (UPC), in which UPs and many European patents will be litigated, for territories both in and outside the UK. The Unified Patent Court (UPC) will not be a UK court but it is intended to address UK issues, whether in the UK branches or elsewhere. It is therefore necessary to ensure the threats provisions apply to acts in the UK regardless of where threatened proceedings may be brought. This may however lead to procedural issues because UK national courts, which would deal with a threats claim, will not have jurisdiction over infringement or validity of UPs or, in due course, European patents: in order to defend a threats claim, therefore, a patentee may be forced to bring parallel proceedings in the UPC where any threats claim is brought in the UK concerning a patent subject to the jurisdiction of the UPC, especially UPs.
A threat of infringement proceedings is still only considered to be actionable if the recipient can be said to be “aggrieved” by the threat.
Liability for professional advisers
Under the old law, professional advisers who made threats on behalf of a client were liable for threats actions by an aggrieved party. Changes have been made to provide protection for professional advisers such as patent attorneys and solicitors. The communication sent to the potential infringer must clearly state the adviser is acting on client instructions and identify in the communication the client on whose instructions the adviser is acting.