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IP Information & News

02 October 2017

Unjustified Threats - Can you still send out a threatening letter?

The Intellectual Property (Unjustified Threats) Act 2017, which came into force on 1 October 2017, sets out to remove the previous inconsistencies between the rules on what constituted an unjustified threat of infringing proceedings for different types of IP rights.  

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As a starting point, it is important to remember that the new regime applies to patents, supplementary protection certificates, registered UK and EU trade marks, registered UK and Community (EU) designs and unregistered UK and Community designs, but does not prohibit threats of proceedings in respect of copyright, passing off, breach of confidence or other intellectual property rights.

Under the new Act any communication will be seen as containing a "threat of infringement proceedings" if a reasonable person in the position of a recipient would understand from the communication that a right exists, and a person intends to bring proceedings (in a court in the UK or elsewhere) against another person for infringement of the right by an act done (or proposed to be done) in the UK.

A threat of infringement proceedings falling within this definition may be actionable by any person "aggrieved" by the threat, unless it falls within one of the "not actionable" exceptions or is contained in a "permitted communication" as defined by the Act.  It should be remembered that to be “aggrieved” by a threat you do not need to have received the threat, but simply have your commercial interests affected.  For example, a threat to a retailer to stop selling a product may allow the manufacturer to bring an action.

So how do you avoid making an unjustified threat and being caught by the provisions of the Act?  The key question which needs to asked, both by IP rights owners and their advisors, is whether they can justify the claims they are making?  If you can show that the act in respect of which proceedings were threatened constitutes (or if done would constitute) an infringement of the IP right then you have a defence to a claim for making an unjustified threat.  It is therefore essential to make sure that a proper assessment of any claims are made before sending out a letter before action.  These should include whether you have a valid right on which to rely; that you have correctly identified who is committing the infringing act; and have some evidence to back up the claims that you are making.  Without a proper analysis of the case, the IP owner would be ill advised to make a threat of infringement.

The Act does not prevent an IP owner from simply making enquiries or bringing to the attention of a third party, the existence of their rights.  It this therefore acceptable to give notice that an IP right exists, especially where awareness of the right may be relevant in any subsequent proceedings involving the right; or to make enquiries as to whether, or by whom, an IP right has been infringed.  This type of communication is specifically permitted by the Act so long as it is restricted to details of the IP right, and contains information which is accurate, not misleading and enables the identification of the products or processes which it is alleged may be infringements.  However, this type of letter must not contain requests to stop use, deliver up or destroy goods, or give undertakings if it is to fall within the “permitted communications” defence.

In practice not much should have changed following the introduction of the Act.  For IP owners who think third parties are infringing their rights they should, with their legal advisors, make a careful assessment of what is being done, see if amounts to infringement and, if so, decide who they are prepared to issue proceedings.  In short, you should not issue threats unless you can back them up and are, ideally, prepared to do so by issuing proceedings.