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UK SMEs welcome cost capping pilot for patent disputes

Proposed Pilot Scheme to Introduce Capped Costs Regime for Patent Cases in the UK

The Civil Justice Council’s final Report on Costs, released in May 2023, has proposed significant changes to the current system, particularly in relation to patent cases. One of the key proposals is the introduction of a capped costs regime of £500k in the Shorter Trials Scheme (STS) for patent cases, aimed at providing certainty to SMEs involved in litigation.

Currently, the STS offers a designated judge for less complex cases with a trial duration of up to 4 days, but there is still uncertainty over potential costs exposure, with patent cases often exceeding £1m per party. This poses a challenge for SMEs seeking justice in patent disputes, especially when compared to the costs capping regime in the Unified Patent Court.

The IP Federation has expressed support for a pilot scheme to cap overall recoverable costs at £500k in patent cases, which is expected to start on 1 January 2024 and run for three years. This move is likely to be welcomed by many SMEs, providing them with the certainty they need when litigating patent cases.

The introduction of a similar costs capping regime in the IPEC led to a surge in new cases, indicating a pent-up demand for such measures. It is anticipated that the proposed pilot in patent cases will have a similar effect, potentially increasing access to justice for SMEs in the UK.

For further information on this topic, you can contact Martin Noble or another member of the Intellectual Property & Media team at Freeths.

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