Irony in Intellectual Property Arbitration

Abstract

MANY HALLMARKS of arbitration intellectual property (IP) disputes are common to binding private dispute resolution in other areas. On scrutiny, the special nature of IP arbitration is not really all that special. The themes evoked in IP controversies connect with private dispute resolution in other fields, illustrating again arbitration's protean nature, in which a unity of essence survives a diversity in outward form. It is beyond cavil, for example, that IP raises public policy concerns. Any country will have an understandable reluctance to see arbitrators interference with national regulation of patent validity. Consequently, IP arbitration addresses principally the allocation of rights under licence agreements. Similar considerations exist with respect to arbitration involving matters such as antitrust,1 securities regulation2 and bankruptcy.3 These disputes all implicate public rights, whose violation could result in a loss to society-at-large, which never signed the agreement to arbitrate. Antitrust violations may mean higher prices for consumers. Securities fraud undermines confidence in public markets. Disposition of property belonging to a bankrupt company might limit assets available to other creditors. With respect to some of these subjects, analogous divisions of responsibility exist between courts and arbitrators. For example, arbitrators may determine damages suffered as a result of a contract breach by a company in bankruptcy. They cannot, however, usurp the ‘core’ bankruptcy functions exercised by judges in matters such as creditors' priority, preferential transfers and offsets.4 From a procedural perspective IP arbitration raises issues that are not too different from other forms of private binding dispute resolution. True, IP disputes often implicate interim measures and technical expertise, which played a part in the elaboration of IP arbitration rules by the World Intellectual Property Organization (WIPO). However, similar concerns exist in arbitration related to corporate acquisitions, joint ventures, investment and finance. Citing the need for …