Small claims track for IP cases under £5,000

The government has said it will set up a copyright small claims jurisdiction for IP cases involving sums of £5,000 or less, as long as the move satisfies a 'value for money' test.

Creating the new small claims track was recommended by Lord Justice Jackson and the IP court users committee. Ministers said it was unlikely to be suited to complex patent disputes but could be used for copyright, design and possibly trademark cases.

In its response to the Hargreaves report on IP reform, the government said small businesses had 'legitimate concerns about their ability to enforce lower-valued IP rights claims through the courts'.

Although arbitration might be a better option for resolving small cases in some instances, ministers said 'access to the courts at a proportionate cost should act as an incentive to settle or arbitrate as well as being a means of resolving less tractable but straightforward disputes'.

In a related move, the government said it would consider changing the name of the Patents County Court, which will hear the cases, to the Intellectual Property County Court.

Martyn Fish, partner at IP specialists HGF in Leeds, said the introduction of small claims for copyright actions could be a good idea.

Fish said he regularly told individual photographers and companies that it was not worth launching an action for unlawful use of their pictures because the costs of litigation in the county courts or High Court were so high.

'The problem is that the small claims track only works if the procedure is so easy that people can do it themselves,' he said. 'Can you make a copyright claim easy enough for people to do it themselves?'

Elsewhere in its response to the Hargreaves report the government decided to not implement section 17 of the Digital Economy Act, which would make it easier for courts to force ISPs to block sites dedicated to copyright infringement (see solicitorsjournal.com 26 April 2011).

The High Court made a blocking order for the first time last week under section 97A of the Copyright, Designs and Patents Act 1988.

Giving judgment in 20th Century Fox Film Corporation and others v BT [2011] EWHC 1981(Ch), Mr Justice Arnold accepted that other copyright owners would want to obtain similar orders (see solicitorsjournal.com 1 August 2011).

Neil Mohring, partner at Eversheds, said that although ISPs would remain concerned by the High Court ruling, the government had to deal with the issue of unauthorised copying.

'There is little incentive for creators, particularly those in small businesses, if unauthorised copying is not addressed, and measures such as the relaxation of the rules regarding parody are merely scratching at the surface.'

BT and other ISPs notched up at least one minor success in the government's response to the Hargreaves report.

ISPs will no longer be obliged to contribute to the costs of Ofcom or the independent appeals system in administering a new mass notification system under the Digital Economy Act.

This follows the failure of a judicial review earlier this year brought by BT and TalkTalk, challenging sections of the Digital Economy Act. Mr Justice Parker ruled that the ISPs should not have to contribute to Ofcom's costs but could be forced to contribute to appeals.

In a further development, the government promised to expand the system of copyright exceptions to include limited private copying, parody and non-commercial research.

The exceptions would include text or data mining, a form of research which creates essentially new and unknown information by extracting data from a wide range of written sources.