New Patents County Court law set to benefit SMEs

A new law comes into force this week that will give small and medium-sized businesses easier access to justice to protect their patent and design rights.

The Patents County Court (Financial Limit) Order 2011 creates a clearer definition of what disputes can be heard in the Patents County Court (PCC) and which ones should go to the High Court. Previously, a business with a legal case worth less than £500,000 could face litigation in either court, with unknown levels of financial risk.

But a damages cap of £500,000 for claims made in the PCC means small companies claiming damages up to that amount are less likely to face a potentially more expensive trip to the High Court.

The change in law will ensure that lower-value, less-complex cases, which would typically involve small businesses, will automatically fall within the jurisdiction of the lower, cheaper PCC. Therefore, the risk of having costly disputes over where the case should be heard will be reduced. In the past, some companies were put off protecting their rights due to the uncertainty of how much it would cost.

Baroness Wilcox, minister for intellectual property, said: ‘These changes will help small businesses and encourage them to innovate. It will also provide clarity over the legal processes, certainty over the risks and give small enterprises the confidence to stand on an equal footing with financially stronger companies.’

Support for the limit was expressed by small and medium-sized businesses during a full public consultation on the reform of the PCC. The effectiveness of the damages cap will be monitored with a formal review in 2014.