Patent, Copyright and Trademark Disputes

While preceding chapters have demonstrated that arbitration is, for many reasons, ideal for IP dispute resolution, each type of IP dispute has specific features and key issues that need to be resolved. Registered or non-registered IP rights, infringement or revocation, sole IP ownership or co-ownership, injunction claims or damages recovery claims, etc., all matter for the strategy of IP alternative dispute resolution. In this chapter, we outline the issues that we face most frequently when arbitrating patent, trademark and copyright disputes.

Patent disputes

Patent as the subject matter of arbitration

Patents are extremely valuable objects of IP rights for the following reasons.

  • Creating an invention is a very time-consuming and costly process. For example, the research and development of one new pharmaceutical product may require investigating about 5,000 to 10,000 compounds, from which only about 250 may become therapeutically promising for further studies and regulatory scrutiny.[2]
  • Cross-border patent prosecution through international (e.g., Patent Cooperation Treaty[3]), regional (e.g., European Patent Convention[4] and Eurasian Patent Convention) and national patent prosecution mechanisms remains lengthy and costly. It requires payments of official fees, patent attorneys’ fees and, going forward, maintenance fees for the entire patent family covering the product.
  • Successful commercialisation of patented products requires time and financial resources, including for obtaining regulatory authorisations.

Not surprisingly, patent rights holders proactively enforce patent rights and rarely tolerate patent infringements. When it comes to resolution of cross-border patent disputes, litigation remains more widely used than arbitration; however, in cases where international arbitration is appropriate, it should neither be ignored nor underestimated as it may contribute substantially to saving time and costs in patent dispute resolution.

According to the statistics of the Arbitration and Mediation Center of the World Intellectual Property Organization (WIPO), 29 per cent of disputes dealt with by the Center are patent disputes.[5] While the Center is an arbitration institution specialised in IP arbitration, some non-specialised arbitration institutions administer patent disputes under special rules. For example, the American Arbitration Association (AAA) has the Resolution of Patent Disputes Supplementary Rules (for binding awards) and the National Patent Board Non-Binding Arbitration Rules (for non-binding awards).

Another example is the Rules for Non-Administered Arbitration of Patent and Trade Secret Disputes of the International Institute for Conflict Prevention and Resolution (CPR). Such special rules cover issues typical for commercial arbitration as well as narrow, patent-specific issues. In addition, some arbitration institutions – for example, the Hong Kong International Arbitration Centre[6] and the Silicon Valley Arbitration and Mediation Center[7] – have established, for the parties’ convenience, a separate panel of arbitrators for IP and technology disputes.

Further, the expected establishment of the Arbitration and Mediation Centre of the Unified Patent Court, with seats in Lisbon and Ljubljana, demonstrates that the judicial institutions recognise the importance of arbitration in patent dispute resolution.

When to arbitrate patent disputes

The straightforward scenario is when a patent dispute is contractual and the relevant agreement includes a proper arbitration clause. This is the case when patent disputes arise out of, for example, a patent licence agreement, a collaboration agreement aimed at a joint technology development, or a research and development agreement where the parties have agreed to a specific allocation of rights to foreground technology. One of the types of patent disputes increasingly brought to arbitration in this category are those arising out of licensing of standard-essential patents on fair, reasonable and non-discriminatory terms.

More difficult is the situation when the parties would like to arbitrate a patent dispute containing patent infringement and patent validity issues. In practice, this might be possible when, for example, the arbitration is based on a submission agreement concluded by the parties after the dispute has arisen; however, various jurisdictions still recognise the exclusive jurisdiction of national courts (e.g., specialised IP courts) or administrative institutions, such as patent offices for disputes relating to registered IP rights, including patent rights. The arbitrability of some patent disputes may, therefore, be excluded (e.g., patent validity disputes in Austria and Sweden) or recognised with inter partes effect only (e.g., in the United Kingdom, France, Australia and Germany).

In the latter scenario, the arbitral tribunal may consider issues such as patent validity, but the outcome will not result in revocation of the patent, even if the tribunal finds that the patent falls short of the patentability criteria set out by applicable national law. Despite such restrictive approaches, there are also jurisdictions recognising arbitrability of all patent disputes (e.g., the United States, Switzerland and Canada).

Key issues in arbitrating patent disputes

Composition of the arbitral tribunal

Arbitration of patent disputes is special because of the technical nature of its subject matter. The more complex the technology in dispute, the more important it is that the arbitral tribunal has a technical background enabling it to correctly and efficiently assess the relevant patent’s scope, and the evidence provided, and come to the right conclusion, without relying wholly or predominantly on experts involved in arbitration.

This does not mean that all members of the tribunal must be patent specialists; however, having at least one member of the tribunal with a technical and legal background (e.g., being simultaneously a patent attorney and lawyer) can be very beneficial.

Production of documents and disclosure

The documentation required for the proper presentation of a patent case may be extensive, and it is critical that the arbitral tribunal can identify the data that will be essential for the resolution of the patent dispute. Depending on the type of issues arising in a patent arbitration, such documentation may include, in particular, the following:

  • the claims of the patent in dispute;
  • information on allegedly infringing products or the process of the respondent;
  • information on the use of the asserted claims of the patent in dispute in allegedly infringing a product or process of the respondent (including a chart confirming use of each feature of the asserted claims of the patent in dispute in the product or process);
  • the prosecution file for the patent in dispute;
  • documents confirming disclosure, assignment or attempted assignment of the claimed invention to third parties prior to the patent application filing;
  • documents confirming the creation of the claimed invention prior to the filing of the patent application;
  • prior art confirming non-compliance of the invention with the patentability criteria (including a chart confirming the relevance of prior art to the asserted claims of the patent in dispute); and
  • information on the availability of witnesses and experts (including biographies).

Avoidance of lengthy and costly disclosure and discovery may be a goal of the parties in choosing arbitration as the means for resolving a patent dispute. Facilitation of the arbitration process may be achieved by early exchange of core documentation followed by core technical discovery and, where patent validity issues are in dispute, conducting claim construction. Practitioners generally agree that this enhances the efficiency of proceedings.[8]

Injunctive relief

The availability of injunctive relief is critical for patent disputes. Without obtaining injunctive relief in a timely manner, the claimant may suffer huge damage caused by sales of an infringing product and may even lose the market share entirely. There are jurisdictions (e.g., Germany and the Netherlands) where obtaining injunctive relief before the state courts is a very straightforward process. In certain other countries (e.g., the countries of the Eurasian Economic Union[9]), the state courts consistently decide against granting a preliminary injunction (PI) in patent disputes on the ground that, in their view, a PI substitutes for a permanent injunction and the grant of a PI may be detrimental to the respondent if the patent infringement is not ultimately established by court.

Simultaneously, since injunctive relief is of tremendous importance for IP disputes, exclusion of injunctive relief from the arbitration may be found groundless by state courts.[10]

Parties that are looking for certainty regarding the potential grant of a PI, knowing that a PI is unlikely to be granted by the state courts in some jurisdictions, will be more inclined to opt for arbitration where injunctive relief may be available. Various arbitration rules provide for such an opportunity. For example, an emergency award in a patent arbitration under the AAA Rules provided for an injunction restricting the respondent from licensing, selling, assigning or transferring any of the technology, patents or intellectual property under the contract between the parties.[11]

The WIPO Rules also contain a provision on emergency relief proceedings, which applies to arbitration conducted under arbitration agreements entered into on or after 1 June 2014.[12] Under this provision, a party seeking urgent interim relief prior to the establishment of the tribunal may submit a request for such emergency relief to the WIPO Arbitration and Mediation Center. The request for emergency relief must include a statement of the interim measures sought and the reasons why the relief is needed on an emergency basis. The Center informs the other party of the receipt of the request for emergency relief, and it will appoint a sole emergency arbitrator, usually within two days of the request.

The emergency arbitrator may conduct the proceedings in such manner as they consider appropriate, taking due account of the urgency of the request. They ensure that each party is given a fair opportunity to present its case and may provide for proceedings by telephone, videoconference or online tools, or through written submissions as an alternative to a hearing. The emergency arbitrator may order any interim measure they deem necessary and may make the granting of such orders subject to appropriate security being furnished by the requesting party. Upon request, the emergency arbitrator may modify or terminate the order.

Tribunal-appointed experts

Experts play an important role in the arbitration of patent disputes. An independent expert skilled in the art of dispute is usually appointed by the arbitral tribunal to report on specific issues designated by the tribunal. The tribunal establishes the expert’s terms of reference and communicates the expert’s report to the parties once received. The parties are generally given the opportunity to opine on the expert’s report and to question the expert in the hearing.

The expert’s report remains subject to assessment by the arbitral tribunal unless the parties determine that it shall be conclusive. The latter approach is rarely recommended as the arbitral tribunal (especially where it has a member with a technical background), being aware of all the circumstances of the case, may have a much better judgment on the case than the expert.

The potential issue in the selection of experts is connected with the fact that patent laws are the least harmonised in the field of intellectual property.[13] It relates to the types of patents, subject matters of patents, patentability criteria, definition of patent infringement, etc. For example, one can file a utility model patent in Germany (Gebrauchsmuster) or Kazakhstan (пайдалы модель), but this type of patent is not available in the United States. Similarly, computer programs are patentable in the United States but they are excluded from patentability under the rules of the European Patent Office, with the exception of computer programs with a technical character.[14]

The doctrine of equivalents in patent infringement cases has been fairly recently introduced into UK law by the Supreme Court in Actavis v. Lilly,[15] applied by the Indian courts in Bishwanath Prasad Radhey Shyam v. Hindustan Metal Industries and Ravi Kamal Bali v. Kala Tech and Ors,[16] but so far it has not seriously been tested in the countries of the Eurasian Economic Union. As patent arbitration is likely to extend to patents obtained by the patentee in various jurisdictions under relevant substantive laws, there may be a need to involve a group of experts from various jurisdictions. In this respect, the task of the counsel to the parties and the arbitral tribunal is to engage a reasonable number of experts to serve the purpose of objective but time- and cost-efficient arbitration.

Party-appointed witnesses

In addition to tribunal-appointed experts, witnesses of fact and expert witnesses appointed by the parties may become a key element of patent arbitration. Most commonly, inventors and patentees do not coincide. The inventor may be the patentee’s current or former employee or consultant. The testimony of co-inventors may be extremely helpful to assess how the patent rights are to be allocated. A sworn affidavit of the true author of an employee’s work can completely change the outcome of the proceedings.

As a rule, in the beginning of proceedings, the arbitral tribunal will require the parties to identify witnesses, the subject matter of the testimony and the relevance of the evidence. If the witness is called to provide oral testimony, the witness will be questioned by the arbitral tribunal and the parties. The written testimony is most often provided by witnesses in the form of a signed statement or a sworn affidavit. The arbitral tribunal will generally admit such written evidence, conditioned upon the witnesses’ availability for questioning in the hearing.

As the scope of inventors’ rights differs from jurisdiction to jurisdiction, the arbitral tribunal would need to consider carefully the relationship between the patentee and inventor to make the right assessment under the applicable substantive law.

Remedies

After the injunctions discussed above, monetary damages remain the most popular remedy sought in patent arbitration. WIPO reports that amounts in dispute in WIPO alternative dispute resolution cases have varied from US$15,000 to US$1 billion.[17] Patent arbitration continues to attract high-value disputes.

In Nokia Corporation v. Samsung Electronics Co, the International Chamber of Commerce (ICC) tribunal awarded Nokia compensation estimated at US$218 million annually for use of Nokia’s phone patents.[18] In Tessera Inc v. Amkor Technologies Inc, the ICC tribunal awarded Tessera approximately US$125 million for Amkor’s breach of the patent licence agreement.[19] In InterDigital v. Samsung Technologies, the ICC tribunal awarded InterDigital US$134 million.[20]

Other remedies sought in patent arbitration include, in particular, declaration of infringement, declaration of non-performance of contractual obligations and specific performance (e.g., preservation of confidentiality, provision of security).

Trademark disputes

Trademark as the subject matter of arbitration

The value of brands can hardly be underestimated. According to Interbrand’s Best Global Brands Rankings 2021,[21] the top 10 brand logos by value are:

  • Apple (US$408,251 million);
  • Amazon (US$ 249,249 million);
  • Microsoft (US$210,191 million);
  • Google (US$196,811 million);
  • Samsung (US$74,635 million);
  • Coca-Cola (US$57,488 million);
  • Toyota (US$54,107 million);
  • Mercedes (US$50,866 million);
  • McDonald’s (US$45,865 million); and
  • Disney (US$44,183) million.

The brands’ value indicates the importance of these IP assets for international businesses and the necessity of dealing with relevant trademark-related disputes in a manner that does not affect the brand’s value.

Similarly to patent prosecution, cross-border trademark prosecution is available via international (e.g., the Madrid Agreement Concerning the International Registration of Marks and the Protocol Relating to the Madrid Agreement Concerning the International Registration of Marks), regional (e.g., the EU Trademark Regulations[22]) and national mechanisms. The related cost may be lower than that of patent prosecution but still remains substantial if it comes to maintenance of a global trademark portfolio.

Among IP rights, trademarks are special because they can regularly be revoked in the event of non-use. In the United States, for example, intent to use is a prerequisite of any trademark registration,[23] which, if not complied with, results in the trademark’s revocation. This feature of trademarks stimulates rights holders to actively commercialise trademark rights, including by way of licensing and franchising.

According to the statistics of the WIPO Arbitration and Mediation Center, 20 per cent of disputes dealt with by the Center are trademark disputes,[24] which is a solid figure.

When to arbitrate trademark disputes

The typical contractual trademark-related disputes brought to arbitration include disputes arising from trademark assignments, licensing, franchising and distribution agreements. Additionally, disputes arising from global coexistence agreements for trademarks can be arbitrated in a more time- and cost-efficient manner than they could be litigated in national courts because such cross-border litigation is both lengthy and costly.

The WIPO Arbitration and Mediation Center had the following case relating to a coexistence agreement.[25] Company A registered a trademark for software in the United States and Canada while company B registered an almost identical trademark in Asia. To facilitate trademark use and registration worldwide, the companies entered into a coexistence agreement with a WIPO arbitration clause. When company B refused to assist company A in obtaining trademark registration in Asia (such assistance could be provided, for example, in the form of a letter of consent to trademark registration by company A), company A initiated arbitration. The dispute was resolved by the sole arbitrator’s interim award, which gave legal effect to the solution proposed by the parties. This example demonstrates how the parties efficiently avoided cross-border trademark litigation and resolved the conflict within the interim proceedings.

Trademark infringement and trademark validity issues may be arbitrated where the arbitration is based on a submission agreement concluded by the parties after the dispute has arisen. Similarly to patents, many jurisdictions recognise exclusive jurisdiction of national courts (e.g., specialised IP courts) or administrative institutions, such as trademark offices, for disputes relating to registered IP rights, such as trademark rights. This may result in non-arbitrability of some trademark disputes, including relating to trademark oppositions and revocations, among other things; therefore, the arbitrability of some trademark disputes may be excluded or recognised with inter partes effect only (e.g., in France and Japan). Despite such restrictive approaches, there are also jurisdictions that recognise the arbitrability of all trademark disputes (e.g., Switzerland[26]).

There are disputes (particularly regarding the coexistence of trademarks) that cannot be satisfactorily resolved by national courts, such as situations in which litigation does not at all help the coexistence of the parties but rather separates them completely. Under those circumstances, a seasoned IP arbitrator is much better placed to assist the parties in finding a solution for their coexistence.

Domain name disputes are considered a separate category of IP disputes but, in practice, they are often based on a trademark conflict. WIPO has administered about 57,000 cases under the Uniform Domain Name Dispute Resolution Policy (UDRP), and these proceedings have involved parties from 183 countries and over 100,000 internet domain names, such as ‘.com’, ‘.net’, ‘.org’, ‘.top’, ‘.win’ and ‘.xyz’, and over 80 country top-level domains.[27] The UDRP proceedings are time- and cost-efficient and are frequently used by trademark holders. WIPO discloses statistics of dispute resolution under the UDRP on its website.[28]

Key issues in arbitrating trademark disputes

Composition of the arbitral tribunal

Arbitrating trademark disputes generally requires an arbitral tribunal that is familiar with trademark law. No particular technical expertise is required as such, although in more complex trademark disputes, it may be helpful to have in the arbitral tribunal an arbitrator qualified as a trademark attorney. Still, it is generally recognised that knowledge of trademark law allows arbitrators to judge, for example, the similarity of word or even device or combined trademarks.

In addition to their own expertise, the arbitrators may rely on the opinions of experts brought into arbitration by the parties or the tribunal itself.

Production of documents and disclosure

The documentation required for trademark case consideration may include, in particular, the following:

  • the trademark in dispute;
  • information on the allegedly infringing trademark or the product of the respondent, or both;
  • information on the use of the trademark in dispute or a confusingly similar trademark that is allegedly infringing the product of the respondent;
  • the prosecution file for the trademark in dispute;
  • documents confirming the creation of the trademark in dispute prior to trademark filing;
  • documents confirming independent creation of a trademark in dispute;
  • survey results confirming, for example, consumers’ confusion, the similarity of the trademarks, the trademark’s fame, etc.;
  • trademark-related agreements concluded by the parties;
  • expert opinions confirming, for example, the similarity of the trademarks;
  • evidence of intensive use of the trademark in dispute by the parties;
  • evidence of the value of the trademark in dispute; and
  • information on the availability of witnesses and experts (including biographies).

As the volume of evidence (e.g., confirming the trademark’s fame in a number of jurisdictions) may be very substantial, facilitation of the trademark arbitration process may be achieved by the early exchange of core documentation. The key facts (e.g., ownership, the relationship between the parties and the chronology of infringement) must be brought to the attention of the arbitral tribunal as early as possible so that the tribunal arrives at the evidential hearing with a good understanding of the case.

Injunctive relief

Injunctive relief is regularly sought in trademark disputes. The reason goes far beyond a claimant’s need to prohibit the use of a particular trademark in relation to the goods or services of the respondent and the respondent’s affiliated businesses to prevent damage to the claimant. Use of an identical or confusingly similar trademark may lead to:

  • reputational risks for the claimant arising from the consumers’ confusion if the respondent’s goods or services are not of a good quality;
  • dilution of the claimant’s trademark, harming trademark perception by consumers and resulting in blurring and tarnishing; and
  • a decrease in the distinctiveness of the claimant’s trademark, which may serve as grounds for trademark revocation.

In other words, from the perspective of the rights holder, the sooner the infringing trademark use is stopped the better.

Although in many jurisdictions (e.g., Germany and the Netherlands) obtaining injunctive relief before the state courts is feasible, in other countries (e.g., the countries of Eurasian Economic Union) the state courts more rarely grant PIs in trademark cases. Various arbitration rules, however, provide for such an opportunity. For example, under the WIPO Rules, urgent interim relief is available within emergency relief proceedings applicable to arbitration conducted under arbitration agreements entered on or after 1 June 2014.[29]

While seeking a PI in a trademark dispute, it is extremely important to present to the arbitral tribunal the whole spectrum of reasons (including those described above) substantiating an urgent need for a PI.

Tribunal-appointed experts

While in patent disputes it is hard to go without experts skilled in the art in dispute, in trademark disputes there may be situations where the arbitral tribunal may feel sufficiently comfortable about the rights in question to adjudicate the case without relying on experts. This is especially because in many trademark infringement disputes, the similarity of brands is often tested through consumer surveys and not on the basis of expert opinions.

Still, experts in national trademark law will be needed when it comes to trademark validity issues related to the party’s trademark portfolio in various jurisdictions. Experts in accounting may assist with review of documentation relating to royalty calculation and payment under trademark licensing or franchising agreements.

When it comes to trademark infringement and the issue of the presence or absence of confusing similarity of trademarks, the arbitral tribunal may decide to go without experts. This may be the case where the word trademarks are identical or almost identical. A fair conclusion may be reached more easily where one trademark is famous and the second is a parasite brand.

When the conflicting word trademarks are not famous, however, and not identical (e.g., their first letters differ), it may be difficult to make a decision without taking into account additional evidence (e.g., the results of consumer surveys) or linguistic experts’ opinions on trademark similarity, or both. In the latter scenario, surveys may appear to be more sound evidence as they may help the arbitral tribunal to see the bigger picture (i.e., the perception of the trademarks by consumers).

When it comes to device (logo) and combined trademarks, the designer’s opinion may be helpful. Still, since the trademark law in the majority of jurisdictions approaches trademark similarity from the perspective of consumers’ confusion, the final decision would remain at the arbitral tribunal’s discretion.

Party-appointed witnesses

In addition to tribunal-appointed experts, witnesses of fact and expert witnesses appointed by the parties may be involved in trademark arbitration. While in trademark contractual disputes, it is most often the persons involved in or servicing the contractual relationships who would testify, in trademark infringement and invalidity disputes the circle may be bigger. It may include, among others, the designers or representatives of the brand’s creative agency or, if a trademark is developed as an employee’s work, the relevant employee. The witnesses may be called to provide oral testimony, or the written testimony may be provided in the form of a signed statement or a sworn affidavit.

Remedies

As in patent disputes, in trademark disputes such remedies as injunctions and damages play the key role. Every case is different but an experienced arbitrator will try to bring the parties of, for example, a trademark coexistence agreement-related dispute to settlement since usually the parties have already invested such significant efforts into reaching a coexistence agreement that it would be beneficial for them to find an amicable solution for coexistence; however, when there is a serious breach of a trademark coexistence agreement, an injunction will be necessary.

In the case reported by WIPO,[30] the breach of a trademark coexistence agreement was considered in the course of expedited arbitration proceedings. The arbitrator established partial infringement of the coexistence agreement and issued an injunction ordering the respondent to refrain from infringing behaviour.

In damages claims relating to trademark infringement, in addition to damages assessments based on the number of trademark infringing products detected, the calculation based on, for example, the price of a trademark licence royalty fee may be used to substantiate loss of profit.

Other remedies sought in trademark arbitration may include claims for the destruction of infringing goods, or the packaging or equipment used for the production of infringing products.

Copyright disputes

Copyright as the subject matter of arbitration

Copyright protects a wide range of literary and artistic works, including books, screenplays, choreography, paintings, sculptures, movies, cartoons, music, computer programs, databases, maps, drawings, photographs and architecture. Copyright protects the form (expression) rather than idea.

Under the Berne Convention for the protection of Literary and Artistic Works, copyright is obtained at the moment of creation of the work and does not require any registration. While the majority of countries follow this approach, in some countries, copyrighted work may be registered or deposited voluntarily (e.g., in the United States in the Library of Congress), which serves as a further form of copyright protection.

In addition, copyright law traditionally regulates ‘related (neighbouring) rights’, which protect those who contribute to making copyrighted works available to the public or who produce objects protected by a copyright-like property right (e.g., performers, phonogram producers and broadcasters).

The value of copyright is immense for the IT, media and entertainment industries, which commercialise and enforce copyright extensively. The value of copyright is reflected in the term of copyright protection, which, in the majority of jurisdictions, extends to the life of the author and not less than 70 years after the author’s death.

When to arbitrate copyright disputes

Arbitration is an appropriate means of resolving copyright disputes for a number of reasons. First, in the majority of countries, copyright disputes are recognised as arbitrable, and the challenge of the award on the basis of non-arbitrability has low chances of success; therefore, all copyright-related contractual, infringement and validity disputes can be arbitrated if the parties agree to arbitrate.

Second, these days, the IT, media and entertainment industries work on the basis of lower budgets and, therefore, more frequently opt for time- and cost-efficient dispute resolution, such as arbitration, over lengthier and costly litigation.

Third, copyright-related contractual arrangements, such as software licensing, are regularly structured as international contracts, which make international arbitration highly relevant. According to the statistics of the WIPO Arbitration and Mediation Center, 24 per cent of disputes dealt with by the Center are copyright disputes, which include art (e.g., art marketing agreements), broadcasting, copyright collective management, entertainment, film and media (e.g., film production), copyright infringements, and TV distribution and format disputes.[31]

Key issues in arbitrating copyright disputes

Composition of the arbitral tribunal

Copyright-related contracts are special in terms of definitions and practice and cannot be understood and interpreted correctly without knowledge of the relevant vocabulary and established practice. This generally makes involvement of specialist arbitrators who are familiar with this vocabulary and practice essential. Specialist arbitrators are also helpful as international copyright laws contain numerous international copyright and related rights treaties administered to a wide extent by WIPO (e.g., the WIPO Copyright Treaty, the WIPO Performances and Phonograms Treaty and the Rome Convention for the Protection of Performers, Producers of Phonograms and Broadcasting Organisations).[32]

If the arbitral tribunal includes a copyright specialist who is familiar with such treaties, the tribunal brings substantial added value to the efficiency of the dispute resolution process.

Production of documents and disclosure

The documentation required for copyright arbitration may include the following:

  • the copyright (related right) in dispute;
  • information on the allegedly infringing work of the respondent;
  • information on the use of the copyright (related right) in dispute in the allegedly infringing work of the respondent;
  • confirmation of voluntarily registration or deposition of the copyrighted work in dispute;
  • documents confirming creation of the copyrighted work before the respondent’s work;
  • documents confirming independent creation of the respondent’s work in dispute;
  • survey results confirming plagiarism;
  • copyright-related agreements concluded by the parties (e.g., software licence);
  • information from the development tracking tool (e.g., Jira in the case of software development) confirming progress, allocation of duties and other details of collaboration;
  • an expert opinion confirming, for example, that the copyrighted works are created independently; and
  • information on the availability of witnesses and experts (including biographies).

The arbitration process in copyright cases may be facilitated by the early exchange of core documentation on matters such as ownership of the copyright, the relationship of the parties and the chronology of infringement so that the arbitral tribunal arrives at the evidential hearing with a good understanding of the case.

Injunctive relief

Provided that the parties have agreed to this, preliminary injunctive or interim relief is highly relevant for copyright arbitration and is a key tool to prevent or stop, among other things, distribution or assignment of rights to infringing copyrighted content, software, databases, etc.

Regarding interim relief, most rules of leading arbitration institutions provide for the possibility to appoint an emergency arbitrator to deal with interim measures, and these rules are increasingly used by the parties to request interim measures.[33]

Tribunal-appointed experts

In copyright disputes, both technical experts and experts with a background in art, design, etc., may be relevant. If the case involves a comparison of software products to establish plagiarism, the technical experts would compare the code and provide expert opinions stating that the products are independent works or that one software product was developed on the basis of the code of the other software product.

The situation differs if the copyrighted works in dispute are novels or movies. In those cases, the subject matter experts will likely be specialists in language who would compare the texts of the novels or screenplays to establish or deny the fact of plagiarism.

In cases where the claimant seeks damages, damages experts can be involved to check the calculations made by the parties for a software licence, for example. It is important that the involvement of experts is anticipated in the arbitration schedule, and all related preparatory steps (e.g., tutorials, production of reports and decisions on whether the experts present individually or in tandem) take place before the evidential hearing.[34]

Party-appointed witnesses

In copyright arbitration, witnesses of fact and expert witnesses may be relevant for a number of reasons. The copyrighted work may be created by co-authors, who are also referred to as a group of co-developers if a software product is concerned. Regarding an employee’s copyrighted work, the other employees (who need not even be co-authors) and company management may be needed as witnesses.

In copyright-related contractual disputes, the persons involved in or servicing the contractual relationship would testify. In copyright infringement disputes, the number of witnesses needed may be bigger.

The witnesses may be called to provide oral testimony, or the written testimony may be provided in the form of a signed statement or a sworn affidavit.

As with experts, it is important that involvement of witnesses is anticipated in the arbitration schedule and that all preparatory steps have been taken before the evidential hearing.

Remedies

In copyright disputes, the parties typically seek injunctions and damages recovery. In copyright-related cases reported by WIPO,[35] damages recovery has been sought in, among other things, broadcast rights distribution agreement arbitration, expedited arbitration of a software dispute and expedited arbitration relating to a banking software dispute.[36]

In damages claims relating to copyright infringement, a calculation based on, for example, the price of a copyright licence royalty fee may be used to substantiate lost profit, as an alternative to a damages assessment based on the number of copyright-infringing products detected.

In a dispute related to, for example, a software development agreement, an experienced arbitrator will try to bring the parties to settlement to save the collaborative relationship between the parties if at all possible; termination of such a contract may be detrimental for both parties. They may well keep their background copyright, but the foreground copyright would need to be allocated between the parties in line with the contract’s provisions, and the final product may never be created.

Other remedies sought in copyright arbitration may include claims for the destruction of infringing goods, or the packaging or equipment used for the production of infringing products.

Conclusion

All patent, trademark and copyright disputes can be resolved in a timely and cost-efficient manner by way of arbitration. The right composition of an arbitral tribunal may not only help to resolve the dispute but may also assist in ensuring that the parties’ business relationship is not broken in the course of arbitration, which is critical for research and development, collaboration, alliances and other IP rights-related contractual arrangements.

The right choice of applicable law and jurisdiction helps to achieve this result because of differences in approaches to the arbitrability of IP disputes in various countries; however, the procedural rules and tools in IP arbitration are fairly unified and just need to be carefully selected by the parties and their counsel.


Notes

[1] Natalia Gulyaeva is a partner at Hogan Lovells International LLP.

[2] Britannica, ‘Drug Discovery and Development’, www.britannica.com/technology/pharmaceutical-industry/Drug-discovery-and-development (accessed 14 October 2022).

[3] Patent Cooperation Treaty, amended on 3 October 2001.

[4] European Patent Convention, 17th edn., November 2020.

[5] World Intellectual Property Organization (WIPO), ‘WIPO Caseload Summary’, www.wipo.int/amc/en/center/caseload.html (accessed 14 October 2022).

[6] Hong Kong International Arbitration Centre, ‘Panel of Arbitrators for Intellectual Property Disputes’, www.hkiac.org/arbitration/arbitrators/panel-arbitrators-intellectual-property (accessed 17 October 2022).

[7] Silicon Valley Arbitration and Mediation Center, ‘The 2022 Tech List’, https://svamc.org/2022-tech-list (accessed 17 October 2022).

[8] Donald R Dunner and John M Williamson, ‘Arbitration Rules for Patent Infringement Disputes’, Finnegan, March 2016.

[9] Armenia, Belarus, Kazakhstan, Kyrgyzstan and Russia.

[10] US Supreme Court, No. 17–1272, 8 January 2019, Henry Schein, Inc, et al v. Archer & White Sales, Inc.

[11] Max Sound Corporation, Max Sound Corporation v. VSL Communications Ltc. See ‘Max Sound Corporation Continues to Successfully Enforce Its Rights Against VSL’, GlobeNewswire, 22 January 2016.

[12] Article 49 of the WIPO Arbitration Rules, effective from 1 July 2021.

[13] Randy L Campbell, ‘Global Patent Law Harmonization: Benefits and Implementation’, 13 Indiana Int. Comp. Law Rev., Vol. 3, No. 2, 2003.

[14] Guidelines for Examination in the European Patent Office, March 2022 Edition, Part G (Patentability), Section 3.6.

[15] Rachel Mumby and Chloe Dickson, ‘The doctrine of equivalents – a late summer picnic of updates’, Bristows, 9 October 2019.

[16] Singh & Associates, ‘India: Doctrine of Equivalents: Patent Infringement’, Mondaq, 3 March 2020.

[17] See footnote 5.

[18] Mihir Chattopadhyay, ‘Recent Event: The Case for Arbitration of Patent Disputes’, Kluwer Arbitration Blog, 25 February 2016, http://arbitrationblog.kluwerarbitration.com/2016/02/25/recent-event-the-case-for-arbitration-of-patent-disputes (accessed 17 October 2022).

[19] id.

[20] id.

[21] Interbrand, ‘Best Global Brands’, https://interbrand.com/best-global-brands (accessed 17 October 2022).

[22] Regulation (EU) 2015/2424 of the European Parliament and the Council amending the Community trademark regulation.

[23] United States Patent and Trademark Office, ‘Intent to use (ITU) forms’, www.uspto.gov/trademarks-application-process/filing-online/intent-use-itu-forms (accessed 17 October 2022).

[24] See footnote 5.

[25] WIPO, ‘WIPO Arbitration Case Examples’, www.wipo.int/amc/en/arbitration/case-example.html (accessed 17 October 2022).

[26] Robert Briner, ‘The Arbitrability of Intellectual Property Disputes with Particular Emphasis on the Situation in Switzerland’, Worldwide Forum on the Arbitration of Intellectual Property Disputes, 3–4 March 1994, www.wipo.int/amc/en/events/conferences/1994/briner.html (accessed 17 October 2022).

[27] See footnote 5.

[28] WIPO, ‘WIPO Domain Name Dispute Resolution Statistics’, www.wipo.int/amc/en/domains/statistics (accessed 17 October 2022).

[29] Article 49 of the WIPO Arbitration Rules, effective from 1 July 2021.

[30] See footnote 25.

[31] See footnote 5.

[32] WIPO, ‘WIPO-Administered Treaties’, www.wipo.int/treaties (accessed 17 October 2022).

[33] Laura Kaster and Harrie Samaras, ‘Arbitrating Trademark, Copyright and Trade Secret Cases’, www.ccarbitrators.org/industry-sector/trademark-copyright-and-trade-secret-disputes (accessed 17 October 2022).

[34] id.

[35] See footnote 25.

[36] id.

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