Earlier this year I discussed mediation as a method of resolving IP disputes (see IP Mediation 22 May 2015). Mediation is a form of alternative dispute resolution ("ADR"), that is to say resolving a disputes without going to court. ADR offers a number of advantages which the World Intellectual Property Organization ("WIPO") listed in ADR Advantages. As I noted in my previous article "the courts and the Intellectual Property Office ("IPO") hearing officers expect parties to consider mediation or some other form of alternative dispute resolution before issuing proceedings" in every case.
In that article I described mediation as "chaired" or "facilitated" negotiation. Like all forms of negotiation it works through consent. However. there are some disputes that can never be resolved in this way. They require an adjudication, that is to say a decision based on a finding of fact and law. Litigation is one form of adjudication and arbitration is another. An arbitration can resemble a court case with counsel examining witnesses on oath and making detailed submissions on the law but differs from litigation in that the person who decides the dispute ("the arbitrator") and the procedure by which he or she reaches his or her decision are chosen by the parties. Often the arbitration takes place behind closed doors and the decision is made available only to the parties. Further information on arbitration can be gleaned from the WIPO's arbitration index.
Arbitration can take place only if the parties agree to dispose of their dispute in this way. Such an agreement can be made either before a dispute arises or afterwards. The WIPO suggests the following dispute resolution clause for a licence or other commercial agreement:
"Any dispute, controversy or claim arising under, out of or relating to this contract and any subsequent amendments of this contract, including, without limitation, its formation, validity, binding effect, interpretation, performance, breach or termination, as well as non-contractual claims, shall be referred to and finally determined by arbitration in accordance with the WIPO Arbitration Rules. The arbitral tribunal shall consist of [a sole arbitrator][three arbitrators]. The place of arbitration shall be [specify place]. The language to be used in the arbitral proceedings shall be [specify language]. The dispute, controversy or claim shall be decided in accordance with the law of [specify jurisdiction]."If the parties wish to refer an existing dispute to arbitration where there is no arbitration clause, the WIPO suggests the following form of words:
"We, the undersigned parties, hereby agree that the following dispute shall be referred to and finally determined by arbitration in accordance with the WIPO Arbitration Rules:There are, of course, other arbitration rules for parties to choose.
[brief description of the dispute]
The arbitral tribunal shall consist of [a sole arbitrator][three arbitrators]. The place of arbitration shall be [specify place]. The language to be used in the arbitral proceedings shall be [specify language]. The dispute shall be decided in accordance with the law of [specify jurisdiction]."
Although most intellectual property disputes could be resolved by arbitration very few actually are in the United Kingdom at any rate. There are a number of reasons for that. In Why Arbitration in Intellectual Property? the WIPO lists a number of features of litigation such as lack of judicial expertise and long drawn out procedures that simply do not apply to England and Wales. We have specialist Patents and Enterprise Court judges who are equipped with powers to ensure the just and relatively swift disposal of cases. However, even in the UK there are cases such as those where there is an arbitration clause or an international element where arbitration is the only or preferred option. The increasing cost of bringing an action in the civil courts may also make arbitration more attractive (see How to enforce your IP claim after court fees sky rocket 7 March 2015 NIPC Inventors' Club).
Should anyone wish to refer a dispute to arbitration we have a team of arbitrators in 4-5 Gray's Inn Square of which I am a member and I specialize in the resolution of IP and technology disputes. I sit on the WIPO list of neutrals together with my colleague Joseph Dalby SC of the Irish Bar. If anyone wishes to discuss this article or arbitration in general call me on 020 7404 5252 during office hours or contact me through my message form.