The UK Government has published its response to the Law Commission's 2014 report on reforming the regime governing groundless threats of IP infringement proceedings (see our previous  alert of 23 April 2014).

The Government has largely agreed with the Law Commission's proposals and has accepted the conclusion that the threats provisions on patents, trade marks and registered and unregistered designs should be retained but reformed. Unjustified threats of legal action for the infringement of IP rights can be damaging to businesses and the current regime is regarded as too ambiguous in terms of what liability will follow from actions taken by rights' holders.

The reform proposals aim to ensure that the threats provisions better protect businesses and are clearer to understand; make it easier for parties to make good faith attempts to settle disputes before litigation; and prevent professional advisers from being liable for threats by virtue of their acting in the dispute.

Key conclusions

Consistency across IP rights – to align with the existing position on patents, the Government has accepted the proposal in respect of other IP rights that a threats action cannot be brought for threats made against a primary actor, even where that threat relates to secondary acts of infringement as well as primary acts.

Flexibility of communications – the Government accepted the principle that rights holders should be entitled to communicate for a "legitimate commercial purpose" with a secondary infringer without falling foul of the threats provisions, if the information in the communication is necessary for that purpose. The Government will, however, reflect further on whether "legitimate commercial purpose" is the correct statutory definition.

The use of reasonable endeavours – was the Law Commission's recommended test to be applied in respect of what the person making the threat to a secondary actor must do to discover the primary actor? This principle was accepted by the Government, such that the rights holder should not be required to go to "extraordinary lengths" to invoke this defence. However, the Government had reservations as to whether the 'reasonable endeavours' test is "objectively clearer, fairer and better understood" than the existing 'best endeavours' test in patent law.

Preventing liability for professional advisers – under the current regime, liability for threats actions could potentially extend to professional advisers. Recognising this issue, the Government agreed that lawyers, registered patent attorneys or registered trade mark attorneys will not be jointly liable where they have only acted in their professional capacity. However, this exemption will only apply when the communication from the professional clearly identifies the client and the burden of proof will fall on the professional adviser to show that they were acting on instructions.

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