Mainland Hong Kong SAR and Macau SAR Intellectual

Mainland, Hong Kong SAR and Macau SAR Intellectual Property Symposium 2003 China Intellectual Property Training Center, Beijing THEME : Judicial Protection of Intellectual Property Rights in Hong Kong ~ By C. K. Kwong ~ Sit Fung Kwong & Shum http: //www. sfks. com. hk

I. Brief Outline of the Present Judicial Procedures A. Civil Procedures Cease and Desist Letter demands: - an undertaking not to infringe - delivery up - disclosure of past dealings - payment of damages - contribution of legal costs

Less due diligence before action to save costs Legal Action in the Civil Court writ Statement of Claim” Ex-parte Injunction Anton Piller K G v. Manufacturing Process Ltd. [1976] CH. 55 (CA)

Interlocutory Injunction American Cyanamid v. Ethicon Defence Reply Other interlocutory applications - further & better particulars, interrogatories, security for costs Summons for Directions - evidence - trial Summary judgment

Costs hourly rates (barrister) HK$2, 500 per hour from a reasonably competent junior counsel to HK$8, 000 per hour for a Senior Counsel Solicitors hourly rate ranges from HK$1, 000 to HK$4, 500 Usually costs recoverable is approximately 60% to 70% of actual amount spent Difficult to estimate costs. It depends on how aggressive will the litigation be conducted by the parties.

B. Criminal Procedures and Remedies Copyright Ordinance Trade Descriptions Ordinance Judicial Trend

II Reform on Civil Procedure Rules Consultation Paper “Civil Justice Reform : Interim Report and Consultative Paper” November 2001 report on other relevant jurisdictions, review the Hong Kong situation

formulate proposals for reform The Woolf reforms in England used as a frame work Aim to address problems of expense, delay, complexity and inequality in resources New system be just, fair, efficient, user friendly, economical and practical 80 proposals put forward

Common Complaints Too expensive Too slow Lack of equality Too uncertain Too complicated Misuse of adversarial system Take up disproportionate judicial resources

Themes for possible reforms Proportionality Re-defining procedural requirements Encouraging earlier settlement Limiting interlocutory application Giving court greater case management Minimising hearings Introducing costs transparency Exploring use of voluntary ADR

Comments from Lord Woolf himself The idea of proportionality. More complex procedures for more complex case. Small disputes should have simple, cheap and speedy procedure go to the court only as a last resort No. of cases dropped by one-third Court only encourage alternative dispute resolution but cannot order it

Problems include Balancing between certainty and flexibility Controlling costs while encouraging lawyers to incur expenses before litigation starts I. e. “front loading” inconsistencies in the application of the broad powers won’t degenerate into a trial by expert instead of trial by judge principles would be applicable in Hong Kong

The Hong Kong Law Society’s Position The Chief Justice’s Working Party looked at the system from the top down. The Law Society looked at it from bottom up The Woolf Reform is not a panacea to the costs and delay problems Keep the existing rules Acknowledged that litigation in Hong Kong is costly and time consuming. That could be due to other reasons Proposed that pleadings should be “enhanced”

Positive and substantive grounds of defence should be put forward The wide ambit of Peruvian Guano test should apply in discovery of documents There are pros and cons with active case management by the court Different judges making different and inconsistent decisions is even worse

The Intellectual Property Practitioner’s View Point Need to be more efficient and less expensive Generally, the reforms should be supported The following proposals are useful adoption of pre-action protocols favours specialisation

- pleadings to be verified offer for settlement at any stage case management, time tabling and milestones Special List limited discovery Compulsory mediation may not be practical for counterfeiters In other infringement cases, mediation may be useful where IP specialist are available

Summary assessment of costs may be adopted provided it does not replace a detailed cost analysis in appropriate cases Court should have control on the scope and use of expert evidence A Code of Conduct for expert witnesses should be introduced Welcome solicitors and barristers (i) to disclose to their clients basis of their charges (ii) to provide best estimates

A new set of rules rather than piecemeal amendments Essential to have adequate judicial and court resources training programmes to familiarise judges and other court staff with reforms, development of computerised system to perform case-flow management, resource allocation and management statistic function

The Working Party is to provide their final report by the end of this year

~ Thank You ~