The Code of Practice for pre-action conduct in intellectual property disputes provides at paragraph 6:
“6. ALTERNATIVE DISPUTE RESOLUTION
In all cases the parties should consider alternative means of settling their dispute, and, where appropriate, attempt to resolve the dispute without resorting to litigation.
Examples of such means of alternative dispute resolution include:
6.1. dialogue which expressly or by its nature is without prejudice;;
6.2 determination by an independent expert (such as a lawyer experienced in intellectual property matters or an individual experienced in the subject matter of
the claim) whose name and fees, along with the precise issues to be determined,
will have been agreed by the parties in advance;
6.4 arbitration (which carries statutory obligations).”
Similarly, paragraph 4.7 of the Practice Direction Protocols advises parties to “consider whether some form of alternative dispute resolution procedure would be more suitable than litigation, and if so, endeavour to agree which form to adopt.” It warns that both the claimant and defendant may be required by the Court to provide evidence that alternative means of resolving their dispute were considered adding that “courts take the view that litigation should be a last resort and that “if this paragraph is not followed then the court must have regard to such conduct when determining costs.” Options suggested by the Protocol include
- discussion and negotiation.
- Early neutral evaluation by an independent third party (for example, a lawyer experienced in that field or an individual experienced in the subject matter of the claim).
- Mediation – a form of facilitated negotiation assisted by an independent neutral party.
Mediation is now considered more or less routinely in England even though it is not always appropriate. It necessarily involves compromises and sometimes fudge leaving at least one and often all parties feeling disappointed. Moreover, mediation no longer comes cheap and I have known cases where the weaker party has settled for far less than it should rather than stump up its share of the fees of the other side’s choice of mediator.
Some cases require a decision. These include cases where there is a bona fide dispute over the construction of a provision, a legal point or maybe a scientific or technical issue. The decision could take the form of a judgment but the costs of getting to that point – at least in England and Wales and other common law jurisdictions – are prohibitive. Moreover, few if any business relations survive a law suit. However, very few parties consider the other alternatives to litigation set out in the Code and Practice Direction, namely arbitration and expert determination.
One of the reasons why these and other decision based ADR methods are rarely considered is that they are perceived to be at least as expensive as litigation. But they don’t need to be. Everyone is familiar is the ICANN UDRP and other domain name dispute resolution services. Cases before UDRP panellists which may involve quite complex points of trade mark law, passing off, contract and insolvency law are routinely settled within a few weeks for around US$1,500. There is no reason why that cannot be done for other disputes and NIPARB, the low cost decision based specialist IP and technology dispute resolution service that my chambers service company, NIPC Ltd., has set up aims to do just that. As you can see from the “Fees Page” we aim to deliver a decision in a single issue dispute for around £690 (US$1,350) and a 4-day arbitration for £10,500 (US$20,500).
So far I am the only panellist but we are actively recruiting others. Training as an arbitrator up to Chartered Institute fellowship level is required for the arbitration panel but we will consider seriously any competent and experienced IP professional from any jurisdiction for the expert determination panels. Typical cases I have in mind include royalty disputes, disputes between customers and suppliers as to whether equipment corresponds to specification and e-commerce disputes.
Anyone contemplating referring a dispute to us can fill in our online enquiry form. Anyone who wants to be considered for the arbitration or some other dispute resolution panel can also apply online.
One this scheme is up and running we shall run nipmed a specialist IP mediation for which I am glad to say that I have already a distinguished forensic accountant as a panellist.