What Are the Intellectual Property Enterprise Court Cost Caps?

The Intellectual Property Enterprise Court (IPEC) is a court designed with SMEs and intellectual property in mind; it provides a forum for intellectual property litigation in the UK that is quicker and more cost efficient than the High Court.

One of the ways in which the IPEC provides a SME-safe-space for intellectual property litigation is by way of the use of cost capping. The idea behind cost capping is that it gives the parties to the litigation a clear idea on the level of costs they could be exposed to if things do not go their way as the usual rule is that the looser will pay the winner’s costs.

The IPEC provides certain caps in relation to the recoverable costs, this means that litigants without the benefit of significant financial resources are not put off from seeking access to justice for intellectual property claims as it is possible to accurately predict any potential exposure.

The total recoverable costs for a successful party at a liability trial in the IPEC is £60,000. Part 46 of the Civil Procedure Rules (the Court’s procedural rules for litigation), set this out. That rule goes onto provide that for each stage in a claim there are a set amount of costs that can be recovered. For example, at the “attendance at a case management conference” stage (which usually takes place after the parties have exchanged their statements of case) the maximum recoverable costs are caped to £6,000.

There are limits to the IPEC cost caps:

First, court fees, costs relating to enforcement of an order and wasted costs are excluded from the costs cap.

Second, where a party has acted “unreasonably” it can be possible to seek costs over and above the relevant cost cap. An example of unreasonable behaviour can be found in the IPEC case of Akhtar vBhopal Productions (UK) Ltd & Ors [2015] EWHC 154 (IPEC) (03 February 2015) in which the Claimant was found to have acted unreasonably. The unreasonable conduct came by way of serving particulars of claim that were not compliant with the Court’s rules.

In the round, the cost capping measures of the IPEC are a clear way to provide certainty to litigants in relation to the costs orders/awards they may face in any litigation although they will not always apply and especially to those acting unreasonably.