The Unjustified Threats Bill: will it encourage bullying tactics?

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The scope of the law against unjustified threats on IP rights is set to be narrowed shortly, following the publication of the Intellectual Property (Unjustified Threats) Bill. The rules against sending threatening communications to potential infringers of IP rights has long been subject to debate, and the overhaul promises to make it easier for rights holders to warn suspected infringers of the potential for litigation.

Laws against unjustified threats have been in place since the 19th century, the rationale being that the fear of litigation that they can produce may result in traders capitulating to the detriment of their business, even if the IP right asserted is actually invalid. A complete defence to a threat claim is establishing that a valid IP right has been infringed, as justifiable threats are permitted.

In addition to these conditions there are a series of exceptions to the anti-threat rules that exclude action against threats which relate to particular activities. Generally these exceptions are designed to enable rights holders to target the ‘primary actors’ (i.e. manufacturers and importers of the infringing product) rather than secondary infringers such as retailers. However, because the anti-threat rules on different IP rights are covered by different pieces of legislation (e.g. the Patents Act 2004 applies solely to patents) the exceptions inevitably also differ, which some commentators say has led to an unsatisfactory and confusing legal framework. The new Bill seeks to address this by bringing the law on unjustified threats under one roof, though in doing so it has also extended the exceptions significantly.

Firstly, there will be no liability when a threat is made to a primary actor, even if reference is made to a secondary act – this has brought trademarks and designs in line with the current law on patents. More revolutionary is the further provision of a ‘safe harbour’ for certain communications with secondary infringers. When such a communication is for a permitted purpose (e.g. to discover whether a right is being infringed), the information conveyed is necessary to achieve that purpose, and the rights holder reasonably believes that information to be true, threats to secondary actors that subsequently emerge to be unjustified will be protected. A crucial caveat to this is that the rights holder must, before approaching a secondary actor, have used reasonable endeavours to locate the primary infringer.

Clarity and consistency has been long overdue in this area of law and it will be interesting to witness the practical impact of the changes once they come into force. For the sake of smaller enterprises, we hope that major corporations take their obligation to search for primary infringers seriously, and do not use the safe harbour provisions as an excuse to inundate secondary traders with a barrage of threatening correspondence.

The proposed new laws reiterate the importance of properly protecting your business’ IP and in doing so, making sure that you do not infringe that which belongs to third parties. If you have any queries relating to intellectual property rights or require assistance with any other Commercial matter, please do not hesitate to contact me on 0800 689 0831 or at john.pickervance@forbessolicitors.co.uk

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