A new formula for the Patents Court?

Described as over-priced and overly-political, but nevertheless envied for its proactive attitude to reform, Matheu Swallow investigates the 'fuzzy' old world of the Patents Court.

The Patents Court, a branch of the Chancery Division of the High Court, has established an enviable reputation. At a time when the number of claims issued in the Commercial Court is suffering a steep and steady decline, the Patents Court has maintained a busy schedule.

For the second year in succession it will sit in September, banishing the two-month summer break that still exists for much of the Bar.

The judges have a reputation for having introduced reform long before Woolf, meaning it has already adapted to the change in attitude toward litigation that Woolf promotes.

However, it is not free from criticism. Most notably, the patent bar is perceived as being exceptionally overpriced and the Patents County Court, established to make patent litigation cheaper and easier, is widely regarded as a no-go area. The world of patent law faces other problems as well, a raft of legislation in this sphere, as well as in the so-called soft IP arena of trademarks, copyrights and design rights, has led many to criticise government practice.

Some claim IP has become overtly political with the result that the law is “fuzzy”, making it very difficult for lawyers to advise and businesses to plan.

In addition, the creation of a European Patents Court is beset with problems.

Cost is a major issue for all areas of the bar, especially in such pressured times. One senior IP barrister is highly critical of the costs of her own area of specialism.

“There is a very poor service being provided by chambers in London, not as far as the quality of work but the amount solicitors are being charged for this work,” she says.

An IP solicitor compares typical brief fees and daily refreshers for commercial and IP silks. While a commercial barrister may typically cost between u30,000 to u35,000 for a brief fee, an IP silk recently charged a u55,000 brief fee, plus a u3,500 daily refresher. Words like “outrageous” and “ridiculous” are commonplace in conversations with IP solicitors discussing the cost of outsourcing work to the Bar, yet despite this and the fear of an invasion of solicitor-advocates, this niche practice area is booming.

“Solicitors are much more inclined to use barristers more,” says Clive Thorne, a partner in IP at Denton Hall, adding, “if the prices are reasonable.”

The reasons for such high prices is twofold. Firstly, there are few specialist IP barristers and those are completely overburdened with work.

“The IP Bar is more expensive than other specialisms because there is a shortage of them,” says Richard Harrison, head of the commercial litigation department at Laytons.

The second reason, says Thorne, is down to solicitors themselves. “My own profession has let barristers fees get out of control. They seem to be immune from the market,” he says.

He says that the costs are as much as 50 per cent higher than a commercial client would expect to pay.

Senior clerk at 5 New Square Ian Duggan says increased competition from outside the three elite sets at 3 New Square – the chambers of David Young QC – 8 New Square and 11 South Square is now forcing a more flexible approach to costing. Not only are there more specialist IP sets, many commercial sets are looking to add IP capability in their quest to create a one-stop shop.

However, Duggan concedes that, in the field of patent work at least, the mantle of elite status cannot yet be taken from the three leading sets. “It would be very difficult to take that away from them,” he says.

Duggan's own complaint is that, while many solicitors complain about the expense of the elite sets and the level of service they provide, they don't change who they instruct.

“How many times do solicitors say 'God, they're expensive', or 'I can't get hold of them'. They have an option and they should exercise it,” he says.

The Patents County Court was set up about 10 years ago to offer a cheaper and easier alternative to running litigation in the High Court. “It has failed to meet the expectations of it,” says Ian Bowie, senior clerk at 3 New Square.

“I think if the Patent County Court is to claw its way back to being a viable forum there has to be change. It needs to boost and enhance its reputation amongst practitioners. It has lost its way, temporarily I'm sure,” says Bowie.

Mr Justice Laddie, the current senior judge of the Patents Court, says: “The fact is that very little patent litigation is currently being conducted in the Patent County Court. Some cases which probably should be in the Patent County Court are started in the High Court. Seeing as they get dealt with in the High Court pretty fast there's no point in transferring them out.”

Laddie is also critical of the amount of new legislation in the IP field.

“[There has been an] alarming growth in the amount of IP legislation, not just patent, but trademarks, copyright and design, being proposed and coming out of Europe, some of it without proper assessment of economic down-side,” he says.

“It is a scandal the way in which directives have been accepted by the UK Government and implemented by way of statutory instruments,” says Thorne.

“There is now so much law on the copyright side that it is unintelligible,” he adds.

Unfortunately, Thorne sees no prospect of improvement, having been told by the Department of Trade and Industry that there is no prospect of a consolidating act in the near future.

The future also holds the prospect of more European directives winging their way into UK law, with the European designs directive and the copyright directive being but two.

“It's getting out of hand,” says Thorne. “It is a scandal that design protection gives preference to European companies over Japanese and US companies,” he adds, arguing, “IP law is a very very political animal.”

Mr Justice Jacob's principal criticism centres on plans for a European Patent Court.

“I'm deeply critical of the Commission's current proposals for the litigation of a European patent. They propose essentially you have a national court decide at first instance with appeal to a European patent court. That's procedural nonsense. If each country has a different procedure it will be impossible to run a patents court of appeal. The Americans have enough trouble when they have the same procedure,” he says.

While Jacob and Laddie believe there should be a European Patent Court, they are fearful of the consequences if it is simply an adjunct of the European Patent Office.

“We believe in the end it makes no sense whatsoever to have the same point being litigated in three, four or five, and sometimes eight national courts when it's all supposed to be litigating exactly the same law. It is not sensible for the user, employing sets of lawyers in multiple countries, it's just daft.

“The real problem is how do you get a court which has suitable international jurisdiction, and still delivers reasonably speedy justice. And the experience of international courts is that they tend to get slower and slower,” says Laddie.

The problem with the European Patent Office, explains Laddie, is that it is an inquisitorial system. “It has no real expertise in relation to challenging witnesses, searching for documents, and it's not proved very speedy in the past,” he says.

His view is that rather than take an existing bureaucratic structure and stick a court on it, it would make sense to start from scratch.

“I'm afraid to say if it was just drafted on to the European Patent Office it would end up looking like the technical board of appeal of the European Patent Office, which no doubt is great as a board of appeal for patent office procedures, but I don't think they have any expertise on infringement at all.”

Much work has to be done, but if rumours are true and there is to be a new IP judge in the autumn, business must really be booming.

“It will continue to grow. For the moment, intellectual property seems to be on the up-and-up and nothing can stop it,” says Jacob.

The leading players at the Patents Court

The Honourable Mr Justice Jacob

Age: 58

Called to the Bar: 1967

Junior Counsel to Treasury in Patent Matters: 1976-81

Queen's Counsel: 1983

Bencher: 1993

Senior Judge of the Patents Court: January 1995 to October 1997

Currently: Supervising judge for Chancery matters in Birmingham, Bristol and Cardiff and remains a judge of the Patents Court and IP

Why patent law: “No one else seemed to want me and I'd heard about the patent bar and it was easy to get into those days.”

Aim when you took over Patents Court: “To bring patent trials so that anyone who wanted one within a year could have one within a year.”

On the IP Bar: “They're the best IP lawyers in Europe. My old chambers 8 New Square, 11 South Square and 3 New Square are the main three, but 19 Old Buildings and 5 New Square have some good people who don't do patents but do trademark and copyright and of course Grabiners' chambers [One Essex Court] have an IP section.”

On reform: “Discovery is still a waste of time in some areas although we've cut it back a lot, a bit too much subjectiveness in our patent litigation.”

On the future of IP: “It will continue to grow. For the moment IP seems to be on the up-and-up and nothing can stop it. And I'm afraid that governments and the EC are falling for it to some extent. Creating more and more of these rights, which are quite often quite fuzzy rights. If they're fuzzy there's room for argument. If there's room for argument, there's room for lawyers. It's great news for the IP bar and IP solicitors, though not necessarily good for industry, but to some extent that is inevitable.”

Mr Justice Laddie

Age: 53

Called to the Bar: 1969

Junior Counsel to HM Treasury in Patent Matters: 1981-86

Queen's Counsel: 1986

Bencher: 1993

Senior judge of the Patents Court: October 1997 to present

On reform to the Patents Court: “Because we're a small specialist court we had more freedom to adjust our procedures. The result was, well before Woolf, we had introduced rules to cut down the amount of documentary discovery given in cases. Some two years before it became common we had started giving immediate assessment of costs. We had, what are effectively case management conferences, well before Woolf. Our view is that we've done quite a lot to speed things up. We try to get things on to trial within a year of the proceedings being commenced which is an enormous improvement over what it was 15 years ago.”

On other courts: “It sometimes amazes me how long non-patent cases can take to get to trial. And we are supposed to be dealing with things that are technically complex.”

On future reform: “There is still probably too much documentation in trials, you still get too much disclosure. You sometimes get cross-examination longer than is perhaps necessary. But, the judges in the Patents Court are prepared to impose guillotines both on speeches and on cross-examination. No one wants that. It doesn't look good in court if the judge criticises counsel for going to slowly. The result is that the barristers are better.”

Who's in the running to be the next Patents Court judge?

Simon Thorley QC: 3 New Square (D Young QC)

'Regarded as the top silk with David Kitchin but assumed passed over when [Mr Justice] Pumfrey made up'; appointed by Secretary of State for Trade to hear appeals from the Trademark Registry.