Patents County Court Small Claims Track enters into force

Earlier this year, we highlighted the proposals for the creation of a small claims track in the Patents County Court (PCC) and outlined its potential as a low cost forum in which intellectual property disputes could be settled.[1]  These proposals have now been adopted and the small claims track of the PCC came into operation on the 1st October 2012.

Guidelines illustrating how the PCC’s small claims track will operate are now available[2].  They define the jurisdiction of the court, the remedies available therein and detail the applicable claim procedure.  Briefly, after issue of proceedings, a claim form is filed and both parties submit their statement of case. The claimant then files a response to the defence and the case is then allocated.  On the small claims track, directions are normally issued on paper and a date for the final hearing will be fixed without recourse to a preliminary hearing.

Potential users of the court will be drawn to the strict limitation on legal costs claimable by opponents, albeit this is balanced by the limit on the claim value to £5,000[3].  This equilibrium is commensurate with the principles set down when the civil procedure rules were created, namely that justice should be accessible to all parties in a time and cost effective basis and also the type of case that will be heard on this track.

The small claims track will hear cases involving copyright, trade mark, passing off and unregistered design issues.  It is intended as a forum for simpler cases that do not require extensive evidence and hearings should last no more than a day.  Alternatively, cases may be dealt with by the judge on paper if the parties agree.  A range of alternate dispute resolution procedures are also available (e.g. mediation, arbitration).  The small claims track will not however be available to hear claims concerning patents, registered designs and plant varieties due to their complexity.  

Since the small claims track will deal with lower value claims and should handle cases in an expeditious manner there is no provision for the award of interim remedies (e.g. injunctions, search and seizure and asset freezing orders).  The main remedies that are available are those of the higher value multi-claims track, namely damages (or an account of profits) to a limited value and final injunctions to prevent future infringement. It is arguably this later possibility that is of most significance.

Building on the reforms already implemented[4] the Patents County Court appears to be transforming into the cost-effective forum for small and medium enterprises (SMEs) to resolve their intellectual property disputes that it was originally intended to be.  In conjunction with other innovations such as the Patent Box,[5] the value of intellectual property to SMEs is becoming ever more evident.

[2] Guidelines can be found here.

[3] Practice direction for the small claims track is available here. For costs details see subsection 7. As examples, costs recoverable for loss of earnings associated with attending a hearing is limited to £90/day and costs for the other parties’ legal advice are limited to £260.

[4] For details of the foregoing reforms see here.

[5] For details see here.