Why arbitrate intellectual property disputes?


Chief Justice Warren Burger warned the ABA in 1984: “Our litigation system is too expensive, too painful, too destructive, too inefficient for a civilized people. The leader added: “For many claims, trials by adversarial contest must follow the path of the ancient trial by battle and blood.” Trademark and trade secret lawsuits are perhaps some of the most expensive legal challenges, and I’m pretty sure the Chief would have recommended mediation.

The number of civil cases that go to trial in federal courts is a very small percentage of the total number of cases filed; probably less than 5%. However, the road to colonization can be long and very expensive. We can resolve these cases quickly!

Trademark, copyright and trade secret cases can be difficult to resolve, often due to a complicated subject matter, speculative damages and because many issues are factual and disputed, and the trier of fact will want to hear live testimony at trial and weigh that evidence. The discovery is very often long and expensive. Appeals usually follow verdicts or sentences. In the end, the parties are often unhappy with the result and the cost. This must not be the way.

Mediation lends itself to copyright, trademark, and trade secret disputes and is a method of resolving cases without discovery or painful, time-consuming, costly, and protracted litigation. A mediated resolution will occur long before a trial date is set and appeals are resolved. It puts the resolution in the hands of the parties when they are ready to compromise. Mediation avoids an overburdened judiciary and a backlog of cases. Mediation avoids a judiciary that may not have real substantive knowledge of the law governing the dispute. The parties can inject into the mix a mediator with IP training who is able to help the parties reach a creative, even unique resolution.

The timing of mediation can be critical and should be considered early on before the parties have become set in their ways and their positions are frozen. Or before spending so much money, they feel they can’t settle down anymore. Even if the perceived harm is ongoing, the parties can mediate after filing their complaint. A private mediator can often act quickly.

Mediating copyright, trademark and trade secret cases allows the parties to choose a neutral person who has substantial legal expertise as well as training and skills in mediation. A mediator versed in intellectual property can ask pointed questions, help the parties examine the facts, help the parties assess their case and help them reach a settlement. Mediation should be considered well before costly deadlines approach.

Mediation is about resolution through compromise, it involves give and take on both sides. No one who agrees to participate in mediation should expect to walk away with all the marbles; they shouldn’t think, “Be reasonable. Do it my way!”

A mediator who really knows the ins and outs of intellectual property can help the parties define and explore the different rights that exist in an intellectual property dispute and can help the parties allocate those rights between them, so that everyone gets what they need, even if they may not get everything they want. Creative resolutions that the parties have not considered can be reached. An all-or-nothing outcome that can be disastrous for the loser can be avoided, and there are often more issues between the parties than are addressed by the lawsuit.

An intellectual property mediator knowledgeable in the legal discipline involved can also help parties resolve their case by frankly addressing perceived weaknesses with each party, including affirmative defenses that may not be a priority at this time, but which will become essential later in the case. For example, illegal use of a trademark on drug combinations not approved for that use by the FDA. The mediator must develop a relationship of trust with the attorneys of all parties in order to develop perspective and the trust that will lead to resolution. The mediator must help define the real strengths and weaknesses of each party; what resolutions are really needed; what remedies can we give up?

Since discovery is often the most expensive phase of an IP dispute, the parties, working through and with the mediator, could agree for the purposes of mediation, without waiving rights in the event of a dispute. failure of mediation, limiting the scope of discovery and saving thousands of people. dollars without compromising their bottom line. And often, courts will agree to vary scheduling orders to accommodate mediation.

The mediation and the results are confidential, concluded or not. When the need for a frank discussion reveals sensitive information, this aspect of mediation can be crucial.

Finally, a key factor in mediation is that a party can walk away from the table at any time, and this, of course, can be the brashness that allows all parties to act reasonably and work toward a settlement. Although a creative mediator can help parties achieve their goals in ways that a court cannot, such as by suggesting a license or changes to an existing license, no party is compelled to accept a resolution; until agreement is reached on all material terms, the parties are not bound.

Mediating copyright, trademark and trade secret cases may not be everyone’s trademark beer, but compared to litigation, the process is faster and less expensive; It’s confidential. The result will be more balanced by working with an experienced mediator who has deep knowledge that can help the parties consider different paths and help them reach their destination (and sometimes, stay friends).

In the end, there is not much to lose by attempting mediation before embarking on a long and expensive litigation. And, even if the first session fails to reach a resolution, the parties, after some time, may agree to meet and mediate again. To quote a British judge, “The whole point of having mediation. . . is that the most difficult problems can sometimes be solved.


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