Virtual Arbitration: A Viable Solution for Patent Disputes in Europe

Claimants seeking prompt legal redress during the coronavirus pandemic face an unprecedented range of economic, logistical and political hurdles with the result that claims in the U.K. Commercial Court and Chancery Division fell by 65% over the four weeks preceding April 7, 2020, according to data from litigation analysts Solomonic.

Although some hearings are continuing online, jurisdictions such as the U.S. that are heavily dependent on jury trials in civil and commercial matters face substantial delays.

In the field of intellectual property, such concerns have been compounded by a number of decisive interventions that have, for now, blocked the creation of the Unified Patent Court (UPC). This follows the March 20, 2020, ruling of Germany’s Federal Constitutional Court against the ratification of the agreement on a European Unified Patent Court serving 25 countries.

The decision of the German court followed the indication earlier in March from the U.K. Government that the U.K. would not be joining the UPC, even if it were allowed to. The likely reason for the U.K.’s decision is that the Court of Justice of the European Union was due to become the final court of appeal for decisions of the UPC, and that was anathema not only to the staunchest Brexiteers on grounds of principle, but to many lawyers who question its suitability.

In these unprecedented times, all companies are looking for ways to save money and stay in business. For those with patent disputes in the offing, the prospect of spending an extended period of time on bringing and/or defending proceedings in multiple European national patent courts may not be attractive.

One possibility to consider is resolving those disputes through international arbitration, with the option of an expedited process. Arbitration is possible even in the absence of a written agreement prior to the dispute. Arbitration demand forms are available in comprehensive, expedited and international formats, and by mutual agreement among parties, arbitration can provide a prompt, effective and enforceable remedy.

For intellectual property disputes, there is the additional benefit that, where appropriate, the scope of the arbitration need not be limited to Europe; it may cover all other relevant territories around the world.

Arbitration has transitioned rapidly and successfully to online platforms. Issues concerning the examination of witnesses were anticipated and dealt with in the Seoul Protocol on Video Conferencing in International Arbitration, and it continues to evolve to meet clients’ needs. Court decisions (U.K.: McGlinn v Waltham Contractors Ltd & Ors [2006] EWHC 2322 (TCC); Canada: Chandra v. CBC, 2015 ONSC 5385) have broadly supported the use of videoconferencing, finding no grounds to suppose parties have been prejudiced by such use. Likewise, there exists a consensus that the prospects of overturning an arbitral award solely on the ground that hearings were conducted virtually are remote.

JAMS has extensive experience doing cases virtually and has handled thousands of cases via videoconference with satisfactory results, even certain advantages.

During the course of arbitration proceedings, if the issues have been clarified, the climate may be conducive for the parties to agree to a mediation to reach an amicable resolution.

This could be a practical option for many types of cases during this exceptional time.   

Richard Price is a panelist with JAMS, based in London. He can be reached at rprice@jamsinternational.com.

Matthew Rushton is JAMS director for the EMEA region and can be reached at mrushton@jamsadr.com

The decision of the German court followed the indication earlier in March from the U.K. Government that the U.K. would not be joining the UPC, even if it were allowed to. The likely reason for the U.K.’s decision is that the Court of Justice of the European Union was due to become the final court of appeal for decisions of the UPC, and that was anathema not only to the staunchest Brexiteers on grounds of principle, but to many lawyers who question its suitability.

In these unprecedented times, all companies are looking for ways to save money and stay in business. For those with patent disputes in the offing, the prospect of spending an extended period of time on bringing and/or defending proceedings in multiple European national patent courts may not be attractive.

One possibility to consider is resolving those disputes through international arbitration, with the option of an expedited process. Arbitration is possible even in the absence of a written agreement prior to the dispute. Arbitration demand forms are available in comprehensive, expedited and international formats, and by mutual agreement among parties, arbitration can provide a prompt, effective and enforceable remedy.

For intellectual property disputes, there is the additional benefit that, where appropriate, the scope of the arbitration need not be limited to Europe; it may cover all other relevant territories around the world.

Arbitration has transitioned rapidly and successfully to online platforms. Issues concerning the examination of witnesses were anticipated and dealt with in the Seoul Protocol on Video Conferencing in International Arbitration, and it continues to evolve to meet clients’ needs. Court decisions (U.K.: McGlinn v Waltham Contractors Ltd & Ors [2006] EWHC 2322 (TCC); Canada: Chandra v. CBC, 2015 ONSC 5385) have broadly supported the use of videoconferencing, finding no grounds to suppose parties have been prejudiced by such use. Likewise, there exists a consensus that the prospects of overturning an arbitral award solely on the ground that hearings were conducted virtually are remote.

JAMS has extensive experience doing cases virtually and has handled thousands of cases via videoconference with satisfactory results, even certain advantages.

During the course of arbitration proceedings, if the issues have been clarified, the climate may be conducive for the parties to agree to a mediation to reach an amicable resolution.

This could be a practical option for many types of cases during this exceptional time.   

Richard Price is a panelist with JAMS, based in London. He can be reached at rprice@jamsinternational.com.

Matthew Rushton is JAMS director for the EMEA region and can be reached at mrushton@jamsadr.com