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Enforcement of global patent rights through arbitration

Filatova, Diana (2022). Enforcement of global patent rights through arbitration. (Unpublished Doctoral thesis, City, University of London)


Patent rights play an essential role in the global economy and represent valuable assets to any business. Although patents are protected internationally by the TRIPS Agreement, in legal practice they have a territorial nature, which presumes that national dispute resolution is decisive in terms of enforcement. Yet, the territoriality of litigation is an immense disadvantage because it imposes conflicting judgments, time and cost constraints in situations where the same patent is litigated in parallel jurisdictions. International arbitration is able to eliminate these costs by removing the need for national litigation.

The study thus proposes arbitration as a global solution for patent disputes whereby parties from different countries would choose to arbitrate in a single key global centre, such as London or Hong Kong, to resolve a global dispute. Unlike adversarial patent litigation, which requires court proceedings in every jurisdiction where the patent rights have been violated, arbitration can be used on a worldwide basis, in a negotiated fashion. Parallel proceedings can be avoided by combining any ongoing proceedings via a single flexible procedure. In addition, the arbitration option allows parties to deal with conflicts over law issues – where complexities arise over the applicable law in contracts with licensees from different jurisdictions. Moreover, arbitration can be used in cases where exclusive remedies are required instead of the standard relief attainable through litigation.

Admittedly, arbitration is a relatively new method to resolve patent disputes, but its advantages identify it as a possible best option for addressing conflicts about global patent rights. Arbitration, within the scope of international intellectual property disputes, has been associated with the time and cost-efficiency of dispute resolution procedures and preservation of business relationships. Moreover, arbitration presumes a limited appeal option, and worldwide enforceability under the United Nations Convention on the Recognition and Enforcement of Foreign Arbitral Awards 1958 which makes arbitral awards final, binding and enforceable in contrast to litigation (where an award’s enforceability is dependent on mutual international agreements and decisions may be appealed in other instances). There is no such global international agreement for the enforcement of foreign court judgments, most of them are regional.

A specific feature of arbitration is also that parties may choose an arbitrator with specialised knowledge in almost any subject area such as pharmaceuticals, technology or engineering. Additionally, the world’s leading arbitral institutions such as LCIA, ICC, HKIAC and WIPO have in recent times amended their rules to promote arbitration in the intellectual property (IP) sector and some institutions have launched special IP panels. Amended rules can shorten the length of procedures including expedited arbitration, emergency relief and consolidation of proceedings as well as a range of interim measures and orders of security for claims and costs. As a result, the number of IP cases being heard by these centres continues to rise every year. The significance of the study is supported by the fact that the trend in using arbitration to resolve patent disputes is already increasing, as demonstrated by the leading arbitral institutions and practitioners.

The last – but not least – attractive feature of arbitration is confidentiality of proceedings and arbitral awards, as well as in some cases secrecy of the existence of a dispute itself, which helps to preserve the company’s reputation and keep its current and future arrangements unaffected by the dispute.

Although arbitration remains a progressive and promising method of resolving patent disputes, there are some limitations. First of all, due to the confidential nature of arbitration there is no system of ‘binding precedent’ of awards. This constrains the development of uniformity and might have adverse effects for the future litigants. Secondly, the consensual nature of arbitration may be considered as a disadvantage in some circumstances. If a party in the dispute is unwilling to accelerate the proceedings and conclude an arbitration agreement, it will be impossible to arbitrate a dispute. Recourse to litigation will be inevitable in such cases, demonstrating that arbitration will never replace litigation entirely. Thirdly comes the issue of objective ‘arbitrability’ of patents. This differs from jurisdiction to jurisdiction, but the growing trend is that most – if not all – major aspects of patent rights are becoming arbitrable in international arbitration including validity, ownership, and infringement. Lastly, although the inter partes effect of the award may be treated as an advantage – protecting patent owners from the risk of losing patents in one worldwide procedure– on the other hand, this could be seen as a limitation to the arbitral tribunal’s authority which cannot revoke or invalidate the patents with erga omnes effects.

Thus, the study analyses the trend in the use of international arbitration and its efficiency and effectiveness in the protection of patent rights in comparison to litigation, its advantages, and disadvantages as well as the possible ways to improve it. In the recent years, parties are becoming more open to arbitration with the understanding of its notable advantages.

As a result, the use of arbitration is growing at a high speed and it will continue growing even more once parties have become fully aware of it, including such sectors as financial technology, pharmaceuticals, information, and communication technologies (ICT) such as 5G and the Internet of things field (IoT). As such a key case study presented in this thesis involves the use of arbitration to resolve disputes over standard-essential patents (SEPs).

Publication Type: Thesis (Doctoral)
Subjects: K Law
K Law > K Law (General)
Departments: Doctoral Theses
The City Law School > The City Law School Doctoral Theses
The City Law School
[thumbnail of Filatova Diana thesis 2022.pdf] Text - Accepted Version
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