WIPO Survey: High Costs of IP Disputes Make ADR an Attractive Alternative

A recent survey by the World Intellectual Property Organization highlights that IP rights holders are increasingly concerned about the high costs of disputes. As a result, they are increasingly looking to alternative dispute resolution.

The survey examined the practices and motivation of almost 400 survey respondents from over 60 countries, and assessed their current use of ADR to resolve technology-related disputes. According to the WIPO, respondents hailed from all across the globe (Europe, North America, Asia, South America, Oceania, the Caribbean and Central America, and Africa, in order of number of responses received) and worked for a number of different entities, including law firms, corporations, research organizations and universities, and government bodies.

Below are some of the findings of note, as detailed by the WIPO:

  • Costs: Respondents incurred significantly higher costs in court litigation than in arbitration and mediation. The legal costs of court litigation in home jurisdictions amounted on average to USD 475,000, and the legal costs of foreign court litigation to slightly over USD 850,000. Meanwhile, 91 percent of respondents stated that costs of mediation typically did not exceed USD 100,000. Arbitration cost on average just over USD 400,000.
  • § Time: Court litigation in home jurisdictions also took longer, taking approximately three years. Arbitration took on average slightly more than one year and mediation was typically concluded within eight months.
  • Frequency: More than 90 percent of respondents executed agreements with parties from other jurisdictions, with more than a quarter indicating that some 60 percent of their agreements involved parties from other jurisdictions. In the area of patents, 80 percent of respondents concluded agreements involving parties from other jurisdictions concerning technology patented in at least two countries.
  • Priorities: Respondents identified costs, followed, in close connection, by time, as their number one priority when negotiating a dispute process. Enforceability ranked as a further consideration among users of court litigation and arbitration clauses. Factors following at some distance included quality of outcome, neutral forum, confidentiality, and desire for a business solution.

 

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