Escalate to court

If your efforts to resolve a dispute are unsuccessful, you can escalate the matter and start court proceedings. Consider what's involved to help decide if this is the best option to take.

Who can sue?

The owner of the IP right usually initiates infringement action. In some cases, an exclusive licensee or authorised user has the right to sue.

Infringement proceedings are expensive. They also allow the other party to challenge the validity of your IP right. You should seek legal advice to help determine whether you're entitled to bring action, and get guidance on whether other parties should join the proceedings.

What to consider before starting court proceedings

Set clear goals

You should decide whether the proceedings are intended to:

  • Obtain financial compensation for infringement
  • Stop further infringement.

In some cases, you may want to achieve both.

Decide who you intend to sue

More than one person can be liable for IP infringement, so it's important to sue all relevant individuals. For example, a company and its directors may all be liable for the infringement.

Consider the impact of publicity

Unless they're covered by a confidentiality order, evidence and documents used in court will become available to the public and lose confidentiality.

Gather all your documents

Contracts, licences and correspondence could all be relevant to the case.

Some contracts require you to participate in alternative forms of dispute resolution before going to court.

Be prepared to write a statement of claim

This document officially starts proceedings. You'll need to state your complaint, the facts supporting your allegations and outcomes you're seeking.

Be prepared for the alleged infringer's defence

They'll respond to your statement of claim by filing a defence document which addresses each of your allegations. In it they'll:

  • Either admit if each allegation is correct, not admit if it's correct, or deny it
  • Establish which facts they dispute that need to be addressed by the court.

Be prepared to disclose all your relevant documents

Both you and the alleged infringer will need to inform each other of any relevant documents that you have access to. These must be disclosed even if they assist the other party in its claim against you.

When you need immediate action

In some cases, your situation might require quick action. For example, if you want to stop an alleged infringer from using your IP now rather than waiting for a court hearing.

In these situations you can request immediate action through an urgent application.

Application for interim injunction

This is an application to make a person or company immediately stop specific activities or require them to take specific actions.

  • The court issues an injunction when it believes there's a serious issue to be tried and monetary damages won't be an adequate response
  • If an injunction is issued, the infringing conduct – although yet unproven – must be stopped immediately
  • Interim injunctions are usually ordered for short periods of time, often one or two days. After this time, all involved are required to attend court to determine whether or not the injunction should be continued
  • If an interim injunction is granted and it's later found that it shouldn't have been ordered, compensation may need to be paid to the person adversely affected.

Application for preliminary discovery

This requires a person or company to give you information about possible infringers.

Anton Piller order

This is the civil equivalent of a search warrant. It allows you to search an infringer's premises and seize specific items relating to infringing conduct. Anton Piller orders aren't easily obtained. You'll need to demonstrate:

  • Evidence of infringement
  • Potentially or actual serious damage
  • Clear and strong evidence that the alleged infringer is likely to possess relevant documents or evidence
  • Clear and strong evidence that relevant documents or evidence are likely to be destroyed or concealed if the infringer has prior notice of the proceedings.

Request for an expedited hearing

When appropriate, you may seek an expedited hearing. You should request this before, or at, your first case management hearing with the judge.

Request for trial limitations

You may also seek, where appropriate, time limitations on a trial for:

  • The examination of witnesses
  • Making submissions
  • Presenting your case and for the hearing generally
  • The number of witnesses to be called (including expert witnesses)
  • The length of written submissions.

Outcomes from court action

If you're successful in a legal action, a court might award you:

Damages

Damages compensate you for losses suffered from infringement. These usually cover:

  • Prejudice to the owner's interests (such as damage to the owner’s reputation)
  • Loss of profit by the owner
  • Profits made by the infringer
  • Presumed licence fee
  • Conversion damages.

Conversation damages are awarded when the court decides the infringing articles are actually the owner's property, which the infringer has, in effect, stolen. The amount usually equals the amount the infringer earned by selling the articles.

Under certain IP legislation, damages can't be ordered if the infringing party wasn't aware they were infringing. In this situation, you'd be limited to their profits.

Account of profits

If the infringer has financially benefited from the infringing goods, the court may order them to pay an amount equal to the profits they made from using your IP.

Final injunction

If infringement is proven, a permanent injunction is put in place to prevent the infringer from undertaking any further infringing conduct. They won't be able to continue their actions without a licence from you.

If you're unsuccessful, you'll have to pay court costs and any associated damages.

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