WIPO-SCIPS Training Program November 28, 2008 IP Disputes and Conflicts Management Sarah Theurich WIPO Arbitration and Mediation Center

WIPO-SCIPS Training Program November 28, 2008

IP Disputes and Conflicts Management

Sarah TheurichWIPO Arbitration and Mediation Center

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Sarah Theurich, WIPO-SCIPS Training Program November 28, 2008

Overview

• WIPO Arbitration and Mediation Center• Trends in IP Disputes - Litigation v. ADR• WIPO Mediation• WIPO Arbitration• WIPO Expert Determination• WIPO ECAF • WIPO Case Experience• Domain name dispute resolution

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WIPO Arbitration and Mediation Center

• Established in 1994

• Provides alternative dispute resolution options for the resolution of intellectual property disputes between private parties

• Time and cost effective resolution of disputes between private parties outside court (ADR) Arbitration Mediation Expert Determination Domain Name Dispute Resolution

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Trends in IP Disputes

• Internationalization of use of IP rights & globalization of markets; need for cross-border solutions for disputes

- Different languages, cultures, geographically limited laws

Need for neutrality (Avoid home-court advantage) Need for global cross-border solutions

• Growth of complex long-term relationships; strategic alliances

- Licensing, cross-licensing, patent pooling

Need for mechanisms that preserve long term business relations

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Trends in IP Disputes

• Increasingly technical and specialized nature of IP

Need for specific expertise of “neutral”

• Closely guarded relationships Need for confidentiality

• Highly competitive areas; short product and market cycles Need for time-efficient procedures

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Litigation

• While the exploitation of IP is global, IP rights are territorial

• Enforcement usually made on country-by-country basis

• Different legal systems - risk of contradictory results (e.g. Angiotech patent 2007)

• Costs• Overview of Litigation in Different Jurisdictions -

Patents as an Example (Source: Patent Litigation, European Lawyer, 2006):

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Country Characteristic of Legal System Average Length Average Cost

France - Civil Law - Unified Litigation - No specialized courts

First Instance: 18-24 months Appeal: 18-24 months

€80,000-150,000 (1st Inst.)

Germany - Civil Law - Bifurcated Litigation - Specialized court for invalidity

First Instance: 12 months Appeal: 15-18 months

€50,000 (1st Inst.) €70,000 (App.)

Italy - Civil Law - Unified Litigation - Specialized courts

First Instance: few months – 24 months Appeal: 18-24 months

€50,000-150,000 (1st Inst.) €30,000-70,000 (App.)

Spain - Civil Law - Unified Litigation - Commercial Courts

First Instance: 12 months Appeal: 12-18 months

€100,000 (1st Inst.) €50,000 (2nd Inst.)

UK - Common Law - Unified Litigation - Specialized courts - Mediation promoted

First Instance: 12 months Court of Appeal: 12 months House of Lords: 24 months

€750,000-1,500,000 (1st Inst.) €150,000-1,500,000 (App.) €150,000-1,500,000 (House of Lords)

China - Civil Law - Bifurcated Litigation - Specialized courts

First Instance: 6 months (in law) Appeal: 3 months, no limit when foreigners litigate

USD150,000 (1st Inst.) USD50,000 (App.)

Japan - Civil Law - Bifurcated Litigation - Specialized courts

First Instance: 14 months Appeal: 9 months

USD300,000 (1st Inst.) USD100,000 (App.)

USA - Common Law - Unified Litigation - Specialized court of appeals (CAFC) - Jury trial available - Mediation promoted

First Instance: up to 24 months Appeal: 12 + months

Up to USD4,000,000 (1st Inst.) USD150,000-250,000 (App.)

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Alternative mechanisms: Mediation, Arbitration, Expert Determination

• Mediation: a non-binding procedure in which a neutral intermediary, the mediator, assists the parties in reaching a settlement of a dispute. Mediator does NOT decide dispute.

• Arbitration: a procedure in which the dispute is submitted to one or more arbitrators who make(s) a final and binding decision (award) on the dispute.

• Expert determination: a procedure in which a specific matter (typically issues of technical, scientific or related business nature) is submitted to one or more expert(s) who make(s) a determination. An expert determination is binding, unless the parties agreed otherwise.

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Advantages of ADR• Single Procedure

Multi-jurisdictional disputes in one proceeding

No jurisdictional problems

• Party control / autonomy / consensual

• Flexibility : “à la carte”

• Expertise Party selection of neutrals; tailored appointment

• Neutral Arbitrator/mediator/expert, language, law, venue

• Confidential Existence, disclosures, result (Arbitration Rules: Art. 52, 73-76)

WIPO Mediation Rules: Art. 14-17, Expert Determination Rules: Art. 15

• Mediation: commercial solution, restore a working business relationship

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WIPO Center: Options

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Routes to ADR

• Court Annexed (in particular mediation)• Voluntary decision of the parties

Submission Agreement ADR Clause

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WIPO Mediation Clause

Any dispute, controversy or claim arising under, out of or relating to this contract and any subsequent amendments of this contract, including, without limitation, its formation, validity, binding effect, interpretation, performance, breach or termination, as well as non-contractual claims, shall be submitted to mediation in accordance with the WIPO Mediation Rules. The place of mediation shall be […]. The language to be used in the mediation shall be […].

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WIPO Mediation Process

Commencement

Appointment of Mediator

Initial Conference

Meetings

Conclusion

Request for Mediation (Art 3-5); Fees Art 21)

Role of the mediator (Art 13); Appointment (Art 6-7)

Conduct of the mediation (Art 9-12)

Set up the first meeting; Agree on preliminary exchange of document, if any

Agree on ground rules of the process; Gather information and identify issues; Explore the interests of the parties; Develop options for settlement; Evaluate options

73% success; duration 1-7months

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WIPO List of Neutrals

• WIPO List of Mediators, Arbitrators and Experts +1000 Mediators, Arbitrators and Experts Patents, trademarks, copyright, IT, Domain

names Industry expertise Detailed profiles

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WIPO Mediation Case Example

• Consulting contract btw. European technology consulting company (patent owner) and Asian manufacturer

• Failure to negotiate patent license• WIPO Mediation Request• Appointment of mediator (patent, mediation and

technology expertise)• Two-day mediation session • Result: license, agreement on future consulting

contracts• http://www.wipo.int/amc/en/mediation/scenario.html

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Mediation followed by Arbitration

• Try mediation before arbitration, at least until

lapse of time period

termination

• Combining the benefits

arbitration well-prepared

"Any dispute, controversy or claim arising under, out of or relating to this contract and any subsequent amendments of this contract, including, without limitation, its formation, validity, binding effect, interpretation, performance, breach or termination, as well as non-contractual claims, shall be submitted to mediation in accordance with the WIPO Mediation Rules. The place of mediation shall be […]. The language to be used in the mediation shall be […]”

If, and to the extent that, any such dispute, controversy or claim has not been settled pursuant to the mediation within [60][90] days of the commencement of the mediation, it shall, upon the filing of a Request for Arbitration by either party, be referred to and finally determined by arbitration in accordance with the WIPO Arbitration Rules. Alternatively, if, before the expiration of the said period of [60][90] days, either party fails to participate or to continue to participate in the mediation, the dispute, controversy or claim shall, upon the filing of a Request for Arbitration by the other party, be referred to and finally determined by arbitration in accordance with the WIPO Arbitration Rules. The arbitral tribunal shall consist of [three arbitrators] [a sole arbitrator]. The place of arbitration shall be […]. The language to be used in the arbitral proceedings shall be […]. The dispute, controversy or claim referred to arbitration shall be decided in accordance with the law of […]."

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WIPO Arbitration Clause

Any dispute, controversy or claim arising under, out of or relating to this contract and any subsequent amendments of this contract, including, without limitation, its formation, validity, binding effect, interpretation, performance, breach or termination, as well as non-contractual claims, shall be referred to and finally determined by arbitration in accordance with the WIPO Arbitration Rules.

The arbitral tribunal shall consist of [three arbitrators] [a sole arbitrator]. The place of arbitration shall be […]. The language to be used in the arbitral proceedings shall be […]. The dispute, controversy or claim shall be decided in accordance with the law of […].

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Problematic Arbitration Clauses

• “Arbitration in Geneva.”

• “WIPO Expedited Arbitration of infringement disputes, [other provider] arbitration of contractual disputes.”

• “Any disputes shall be solved by arbitration between the parties; failing that, arbitration in the English language shall be conducted in Houston, according to the Paris Convention, which shall be final and binding upon the parties.”

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WIPO ARBITRATION

Request for ArbitrationRequest for Arbitration

Answer to Request for Arbitration (30 days)


Appointment of Arbitrator(s)


Statement of Claim(30 days)


Statement of Defense (30 days)


HearingsHearings

Closure of Proceedings(9 months)


Final Award (3 months)Final Award (3 months)

Further Written Statements and Witness

Statements


Statements

Rules on Confidentiality (Art. 52, 73-76)

Rules on technical evidence (Art. 49-51 WIPO Arbitration Rules)

Interim measures (Art. 46)

Arbitration: finality / enforceability of awards

- New York Conventionwith limited exceptions (e.g. denial of due process)- “automatic” enforcement of arbitral awards- 142 signatories

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WIPO ARBITRATION

Request for ArbitrationRequest for Arbitration







Statement of Defense(30 days)

Statement of Defense(30 days)

HearingsHearings



Final Award (3 months)Final Award (3 months)


Statements


Statements

Request for Arbitration and Statement of ClaimRequest for Arbitration and Statement of Claim

WIPO EXPEDITED ARBITRATION

Answer to Request for Arbitration and


Answer to Request for Arbitration and


Appointment of Arbitrator

Appointment of Arbitrator

Hearing (maximum 3 days)

Hearing (maximum 3 days)



Final Award (1 month)Final Award (1 month)

•One exchange of pleadings

•Shorter time limits and hearings

•Sole arbitrator

•Fixed fees

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WIPO Arbitration Case Example

• US university registers TM for email system in US, Canada, etc.

• Asian IT manufacturer registers TM for computer products in 16 countries

• Opposition proceedings & litigation for 6 years

• TM coexistence agreement; WIPO arbitration clause

• US university’s TM application refused in Asian country, requests Asian manufacturer’s collaboration

• Interim award (specific performance)

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WIPO Expert Determinationhttp://www.wipo.int/amc/en/expert-determination/

• Expert determination procedure intended to facilitate

resolution of disputes requiring specialized expertise to

determine specific issues of a technical, scientific or

related business nature.• More informal, flexible and expeditious than arbitration

• Determination binding (unless parties agree otherwise)

• Stand-alone procedure or may be combined with other

procedures.

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WIPO Electronic Case Facility (ECAF)

• Available for arbitration, mediation, expert determination cases under WIPO Rules

Certain exceptions: America’s Cup Jury Procedure

• Main features Web-based electronic docket

Facilitation of party / neutral case management

Easy, Instant, Location-independent

Secure (secure card, username, pin code, password…)

• Submission in most common formats

• All actors may view and search the Docket (by submitting actor, date, subject title)

• Email alerts communicated to all actors when new submission made

• User Information

http://www.wipo.int/amc/en/ecaf

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WIPO Arbitration and Mediation Case Experience

• Over 70 mediations

• Over 100 arbitrations

• Parties from 18 countries (domestic & international) Austria, Canada, China, Denmark, Finland, France,

Germany, Ireland, Israel, Italy, Japan, the Netherlands, Panama, Romania, Spain, Switzerland, UK, USA.

• Place of Arbitration France, Germany, the Netherlands, Switzerland,

USA

• Procedures English, French, German, Italian

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Types of Procedure

Expedited Arbitration

10%

Arbitration 49%

Mediation 41%

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WIPO Caseload: Subject matter

IT22%

Trademarks 5%

Patent 46%

Other 18%

Copyright 9%

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Settlement in WIPO Mediation and Arbitration Cases

24%Not

settled

73% Settled

3% Pending

19% Pending

54% Settled

27% Award

Mediation Arbitration

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Uniform Domain Name Dispute Resolution Policy (UDRP)

• Background (WIPO advice to ICANN - 1998-1999) Need for a procedure permitting trademark owners to

resolve clear cases of abusive domain name registration (cybersquatting) without going to court

• UDRP adopted by ICANN in 1999• Creation of an administrative procedure to settle disputes

relating to domain names (all gTLDs and some ccTLDs) Alternative to litigation

• Domain name registrants are bound to the UDRP through their registration agreement

• Remedies - transfer or cancellation only (no costs or damages)

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Why the UDRP? • Global• Mandatory procedure – contractual basis (part of domain name reg. agreement)• Directly enforceable decisions• Non-profit fees (USD 1,500 for 1-5 domain names)• Fast – approximately 2 months• Transparent – decisions publicly available

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What is Required Under the UDRP? Three Elements

• Trademark must be identical or confusingly similar to the domain name (UDRP Policy, s. 4.(a)(i)); and

• The registrant of the domain name must have no rights or legitimate interests in the domain name (UDRP Policy, s. 4.(a)(ii)); and

• The domain name must have been registered and used in bad faith (UDRP Policy, s. 4.(a)(iii)).

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First Element – Identical or confusingly similar to trademark

• Two requirements: Complainant must prove its rights in a trademark

The domain name must be identical or confusingly similar to that trademark

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Second Element - Rights or Legitimate Interests

• Examples: use of the domain name in connection with a

bona fide offering of goods or services registrant commonly known by the domain name legitimate noncommercial or fair use of the

domain name (e.g., free speech website)

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Third Element - Bad Faith

• Examples of bad faith: registration for purpose of selling the domain

name back to the trademark holder for profit pattern of preventing trademark owners from

registering domain names using the domain name to sell goods through

consumer confusion• Totality of circumstances considered

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The Procedure at a glance

Complain

t

Amend

+3 +20

+5 +14

3-member Panel?+5

+15

+10

Response

Commencemen

tIm

plement

Appointmen

tDecis

ion

“Appeal”?

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WIPO Resources

• WIPO Overview of Selected UDRP Questions:http://www.wipo.int/amc/en/domains/search/overview/index.html

• WIPO Legal Index of UDRP Decisions:http://www.wipo.int/amc/en/domains/search/index.html

• Filing Guidelines • Model Working Documents (Complaint,

Response)

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Some Examples of Disputed Domain Names

tomcruise.com

telstra.org

dior.org

thewiggles.com

sydneyoperahouse.net

jpmorgan.org

uefachampionsleague.com

audi.net

microsoft.org

westfieldshopping.com

juliaroberts.com

madonna.com

findharrypotter.com

nicolekidmannude.com

jimihendrix.com

doctorswithoutborders.com

waynerooney.com

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Some facts and figures

• Over 14,323 domain name cases filed since 1999 • Parties have come from 147 countries

USA top filing country• Cases have been administered in 15 different

languages Chinese, Danish, Dutch, English, French,

German, Italian, Japanese, Korean, Norwegian, Romanian, Russian, Portuguese, Spanish, Swedish

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WIPO ccTLD Program

• ccTLDs – country code top level domains (e.g. “.ch”, “.fr”…)

• 56 ccTLDs using WIPO dispute resolution services

• Advice on request

WIPO ccTLD Best Practices

Avoiding conflicts through appropriate registration

practices

Protecting IP in ccTLDs through administrative

procedures

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Events and Information• WIPO Academy Online Course on Mediation and Arbitration

http://www.wipo.int/academy/en/courses/distance_learning/catalog/c_index.html

• WIPO ADR Workshops: http://www.wipo.int/amc/en/events/

- WIPO Workshop for Mediators in Intellectual Property Disputes – May 28-29, 2009- WIPO Arbitration Workshop – October 2009- WIPO Domain Name Workshop – October 2009

• Mailing list: http://www.wipo.int/amc/en/subscribe/index.html

• Further information:

- http://www.wipo.int/amc

- [email protected]

- [email protected]