Parties have been turning to international arbitration in increasing numbers
to resolve cross-border intellectual property (IP) disputes.
While difficult to quantify (in light of
confidentiality), several sources suggest that this
trend is picking up steam. For example, the World
Intellectual Property Organization (WIPO)
Arbitration and Mediation Center - which tailors
its services to IP-related disputes - has reported a
doubling in the number of cases year on year.
Given the increasing importance of emerging
technologies in the global marketplace, we expect
this trend to accelerate going forward.
Companies with substantial cross-border IP exposure
are turning to international arbitration for a number
of reasons. Arbitration offers a flexible procedure
suited to the unique subject matter, specialised
arbitrators in a neutral (international) forum
and confidentiality protections. Most importantly,
however, international arbitration is usually better
suited than domestic courts for obtaining finality
and avoiding the pitfalls of multijurisdictional
litigation. These features provide substantial
advantages for companies that rely heavily on
IP rights for their business model and operate
on a global scale.
We anticipate further growth in two particular areas:
first, we expect an increase in the use of arbitration
to determine fair, reasonable and non-discriminatory
(FRAND) compensation for the use of standard
essential patents (SEPs) in the technology space.
SEPs are patents protecting a technology that is
necessary for implementing an industry standard
(eg the technology that allows mobile phones made by
different companies to connect to available wireless
networks). Standard setting organisations, which
oversee the development of industry standards, have
been promoting arbitration to resolve FRAND
disputes. In 2017, we saw significant arbitration
awards in this area. For example, Nokia reportedly
achieved major victories in International Chamber
of Commerce (ICC) arbitrations against LG (in
September 2017) and Blackberry (in November 2017).
Intellectual property arbitration:
an emerging trend
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