IP courts: Change in regulations on information claims from 1 July 2020 | In Principle

In our series of articles on IP courts, we cover the key changes under the amendment to the Civil Procedure Code in cases involving protection of intellectual property. We previously wrote about introduction of the new separate procedure and on applications to preserve, present and disclose evidence. Now we analyse the most important changes involving information claims.

Information claims: who may assert them, and under what circumstances?

Information claims in their current form result from implementation into the Polish legal system of the IP Enforcement Directive (2004/48/EC). The provisions governing this institution have been amended several times since their original adoption.

Under the existing regulations, a holder of intellectual property rights may demand that a suspected infringer or third party provide information on circumstances relevant to pursuit of claims for protection of IP rights. The information obtained may be used by the holder of IP rights for example to formulate claims for money damages or disgorgement of unjustly obtained benefits. Meanwhile, information about entities involved in the supply chain may help the holder formulate claims for injunctive relief and to cure the effects of infringement against other persons involved in infringement.

The existing regulations did not require the holder to file suit to protect its rights whenever it obtained the information sought. The absence of such an obligation was criticised because of the risk that such applications would be abused to seek market information about competitors. On the other hand, it was also argued that it is not always warranted or economically feasible to file suit in every case in connection with information obtained about suspected infringement.

Significantly, information claims were regulated differently in the Act on Copyright and Related Rights (Art. 80(1)) than in the Industrial Property Law (currently Art. 286²). The main difference was the scope of information which the suspected infringer could be ordered to present.

It should be added that the provisions on information claims in the Industrial Property Law were the subject of review by the Constitutional Tribunal, which held the regulation previously in force (until 26 February 2020) to be partially constitutional (judgment of 6 February 2018, case no. SK 19/16). In that judgment, the tribunal found that the provisions in question did not ensure commencement of infringement proceedings or that the information obtained would be used by the IP holder exclusively for the purpose of pursuing claims for protection of IP rights, and consequently the provisions disproportionately interfered with business freedom. The tribunal also objected to the possibility of applying for information from “a person other than the infringer,” without specifying more exactly the connection between that person and the suspected infringement.

The Industrial Property Law was consequently amended by the act of 16 October 2019 to bring the wording of the law into compliance with the judgment of the Constitutional Tribunal. But analogous changes were not made to the other acts providing for information claims, i.e. the Copyright Act, the Act on Protection of Databases, and the Act on Legal Protection of Plant Varieties.

So what will change from 1 July 2020?

The amendment establishing intellectual property courts also unifies:

• The conditions for granting information claims
• The types of information subject to disclosure, and
• The set of entities who may be ordered to provide information.

It will be possible to file an application for an order to disclose information on infringement of intellectual property rights both before commencing infringement proceedings and while infringement proceedings are pending. A holder of IP rights will be entitled to seek such an order against a suspected infringer and against a third party who:

• Possesses goods designed, produced or marketed in violation of intellectual property rights, or whose aesthetic or functional properties infringe such rights, in quantities demonstrating actual conduct of commercial activity
• Provides services to a person infringing intellectual property rights, on a scale demonstrating actual conduct of commercial activity
• Performs services in violation of intellectual property rights, on a scale demonstrating actual conduct of commercial activity, or
• Is identified by one of the aforementioned persons as the producer or a participant in the process of introducing such goods onto the market, a recipient of such services, or an entity who performs such services.

According to the justification for the bill, the stress was intentionally placed not on a formal assessment of whether a given entity conducts commercial activity, but on the scale of the person’s activity. In other words, if a third party only formally meets the conditions for being deemed to conduct commercial activity but provides services on too small a scale or has too few goods in their possession to show they are actually operating commercially, the court may refuse to order them to provide information.

The range of information subject to disclosure will also be different than it is now. Under the new Art. 479¹¹⁵ §1 of the Civil Procedure Code, the court will be authorised to order a suspected infringer or third party to provide:

• Names and addresses of producers, manufacturers, distributors, suppliers and other previous holders of the goods or services, as well as intended wholesalers and retailers
• Information on the quantities of goods or services produced, manufactured, delivered, received or ordered, as well as the price obtained for the goods or services, as well as
• Other information needed to demonstrate the amount of the claim, if justified by the specific circumstances.

Practically, this means that an open-ended catalogue of information subject to disclosure is being introduced.

From 1 July 2020, an applicant pursuing an information claim will be required to reliably demonstrate circumstances indicating infringement. The earlier regulations either required a high degree of substantiation of an infringement (Industrial Property Law Art. 286¹(1)(2), in force until 26 February 2020), or did not expressly indicate the grounds for substantiation of the claim as an indispensable condition for granting the application, leaving that issue to be clarified in the case law (Copyright Law Art. 80(1)).

According to the justification for the bill, after the amendment enters into force the rightholder will have to demonstrate a connection between the existence of infringement and the need for enforcing its information claim, which should enable the rightholder to establish the scale of the infringement. The holder will also have to specify the type of information sought and the circumstances demonstrating that the respondent may be in possession of the information sought, and demonstrate that the information is needed to identify the source or scope of the infringement.

The applicant will have to assert a claim against the infringer within one month from compliance with the order to provide information, if the applicant decided to assert an information claim prior to commencing proceedings for protection of its IP rights. If despite compliance by the respondent the rightholder fails to assert a claim or the instrument initiating the proceeding is withdrawn, rejected or dismissed, or if the claim or application is denied or the proceeding discontinued, the respondent who was ordered to provide information will be entitled to pursue a claim for redress of injury, patterned on the regulation applicable in proceedings for interim relief under Civil Procedure Code Art. 746. The respondent will also be entitled to pursue a claim for redress of injury if the rightholder uses the information provided for any purpose other than pursuing a claim for protection of intellectual property rights.

An application for information will have to be served on the respondent so it may take a position on the demand within a period of no less than two weeks. When deciding to issue an order, the court will have to take into consideration the need to protect the respondent’s trade secrets. In an order to provide information, the court must specify the deadline for providing the information, the type and scope of the information, and the rules for review of the information by the rightholder. The act specifies that information will be provided by the respondent under penalty of perjury, which is also a new feature not included in the current regulations.

An order to provide information will be immediately enforceable. The information may be provided in writing or electronically. The order may be enforced via judicial execution for non-monetary obligations (Civil Procedure Code Art. 1050). The correctness of granting the order is also subject to review by the court of second instance if the respondent files an interlocutory appeal.

An application for an order requiring an infringer or third party to provide information will be subject to a filing fee of PLN 200, whether it is filed before or after commencement of the infringement proceedings.

Ewa Nagy, attorney-at-law, Intellectual Property practice, Wardyński & Partners