Guidance

IP (Unjustified Threats) Act for SMEs

Published 1 October 2017

What is intellectual property infringement?

Using someone’s trade mark, patent, copyright or design without their permission is known as intellectual property (IP) infringement.

For example, selling goods of a similar type with a name or logo on them that is too similar to a registered trade mark is infringement. As is manufacturing or selling a product which is protected by a patent or copying someone else’s design. Copyright infringement can arise when copyright protected material is copied, or distributed without the copyright owner’s permission.

The holder of an IP right may take legal action against a person infringing their right.

I have received a letter saying I’m infringing - what do I do now?

Get legal advice, particularly if you think that you are not infringing the right mentioned in the letter. There may be a number of options open to you, but this depends on the circumstances of your case.

Your adviser will be able to recommend how to respond. For example, they will be able to advise whether the letter is a real and justified threat to sue, or if it contains what is known as an unjustified threat.

The law of unjustified threats applies only to patents, trade marks and designs - separate guidance is available on what you should do if you receive a notification of alleged copyright infringement.

Other types of IP right exist, but only rights covered by unjustified threats law are included in this guide.

• using somebody else’s intellectual property

What is an unjustified threat?

If you have infringed an IP right, or intend to do something which will infringe an IP right, then the rights holder can threaten to sue you for infringement.

But, a threat to sue for IP infringement is unjustified if:

• no relevant IP right exists,
• the IP right has expired or is invalid, or
• no infringement has taken place because what you are doing is sufficiently different from what is protected by the IP right

What protection is available against unjustified threats?

The law provides protection against the misuse of intellectual property threats to unfairly intimidate others. If you are affected by an unjustified threat, you may be able to lake legal action against the person who made the threat. You can ask the court to stop them making threats (to award an injunction) or to award you damages.

The law of unjustified threats aims to protect people further down the supply-chain, such as sellers and commercial users of goods and services. So, in general, when the threats are aimed at the ‘source’ of infringement, such as a manufacturer or importer, legal action against the person making the threats is not available.

A professional legal adviser will be able to advise you on whether you can take action against a person making threats which affect you.

I am a rights-holder - how do I avoid making an unjustified threat?

Any person who suffers commercial damage by an unjustified threat you make can sue for you for that damage. So, for example, if you threaten a retailer for selling goods you wrongly believe are protected by your IP and the retailer then stops selling the goods, their supplier may sue you for costing them business.

Unjustified threats do not have to be made directly to the person being threatened. A mass communication, such as a website posting, may also make a threat of IP infringement.

Determining whether an IP right has been infringed can be complicated. This is why you should seek legal advice before making any type of threat. Your legal adviser will let you know what you can say to a potential infringer depending on the circumstances.

• defend your Intellectual property

How should I approach a person I think is infringing my IP right?

If you believe someone is copying your invention, design or brand, a professional legal adviser will be able to advise you on the best course of action.

One option is to write to the alleged infringer, although it is best to seek legal advice before doing so. If the IP right(s) you own and the activities of the infringer do not justify what you say in your letter, you risk being sued for making an unjustified threat. Your legal adviser will be able to help you talk to the alleged infringer in the right way. This can help you resolve the matter quickly and in a cost-effective manner, often without the need to go to court.

What am I allowed to say?

The law is changing from 1 October. The new law clearly states what you can say to a person you believe is infringing your patent, trade mark, or design. It defines what are known as permitted communications.

Permitted communication are intended to help disputing parties communicate in the best way, allowing them to exchange information and avoid going to court.

What you can say in a letter depends on the circumstances and on who you are writing to. The following are examples of what can generally be included:

• you can inform the recipient that an IP right exists for example “I am the owner of patent number GBXXXXXXX which is currently in force”
• you can ask for information about who may be doing particular types of infringement for example “Can you provide the contact details of the manufacturer or importer of product X (sold in your catalogue under catalogue number xxxxxx)?”

You must also be sure that the information you are giving is true.

The following are examples of what you should avoid including in a letter without seeking legal advice first:

• an express threat for example “If you continue to sell product Y, I will sue you for trade mark infringement” or “I’ll see you in court”
• a request that someone stops doing something (like manufacturing or selling a product)
• a request that someone destroys a product or other goods

If you are sure the person you are contacting is infringing a valid IP right then you may say any of the things in this list. But, you risk having to pay damages for making unjustified threats if they were not infringing or if the IP right is invalid.

More in-depth guidance on how the law of unjustified threats works is available.