Intellectual property arbitration

TheArbitrage is a method of dispute resolution in which the parties submit their dispute to one or more referees, which render a binding decision, called arbitral award. Unlike that Mediation, the arbitrator has the power to settle the dispute, and their decision is binding.

Features

• Consensual The parties must have agreed to arbitration, usually via a arbitration clause inserted into a contract (e.g. licence agreement).
• Adaptable The parties may choose the arbitrators, define the applicable rules, and determine the seat of arbitration.
• Confidential Hearings and judgments are not public, protecting business and technical secrets.
• International Arbitration is particularly well-suited for cross-border disputes, as arbitral awards are easily enforceable thanks to the New York Convention (1958).

Application to Patent Law

1. Disputes over infringement and validity
   • Although some jurisdictions (particularly European ones) consider patent validity to be a matter for public authorities, related disputes, such as the scope of claims or infringement, may be submitted to arbitration.
2. Patent licences
   • Disputes concerning the performance, interpretation, or termination of patent licensing agreements (including the FRAND licences) are often arbitrated.
3. R&D agreements and patent co-ownership
   • Disputes over the allocation of rights, the management of patents arising from research collaborations, or exploitation rights are often settled by arbitration.
4. Essential patent for a standard (BEN or in English Standard Essential Patent, «SEP»)
   • When a dispute arises about a essential patent for a standard BEN On the amount of FRAND royalties or access to an essential patent, arbitration can determine a royalty rate reasonable and resolve the conflict without judicial intervention.

Advantages

• Technical expertise Arbitrators can be chosen from patent specialists or those from the relevant sector.
• Speed The timescales are often shorter than a traditional trial.
• Enforceable internationally Arbitral awards are enforceable in over 160 countries thanks to the New York Convention.
• Confidentiality Essential for disputes involving sensitive technical information or financial data.

Limitations

• Sometimes high cost of arbitrators' fees.
• Requires the prior agreement of the parties to resort to arbitration.
• It is not always possible to challenge an arbitral award (except in rare cases of serious irregularities).

Examples of bodies offering arbitration

• WIPO The WIPO Arbitration and Mediation Center offers specialist services for IP disputes, including those involving patents.
• ICC (International Chamber of Commerce) Manages complex commercial arbitrations, including on IP.