Abuse of Intellectual Property Rights
Saturday, 21 March 2026
Chair: Lord Justice Richard Arnold
In Crypto Open Patent Alliance v Wright [2024] EWHC 1809 (Ch), [63], Mellor J. observed
“IP rights, being monopolies of various sorts, are … justified in that their net benefit is in the public interest, with a view to fostering creativity and innovation. By corollary, where IP rights are abused to stifle creativity and innovation, the legal system ought to have the means to respond effectively.”
The statement raises three questions which are the subject of this conference: (i) when are IP rights to be regarded as “abused”? (ii) What mechanisms exist to respond to such abuses? And (iii) Does the legal system have sufficient mechanisms by which to “respond effectively”?
“Abuse” seems to occur in at least four ways: first, abuse in obtaining IP rights, such as was recently considered by the Supreme Court in Sky v Skykick [2024] UKSC 36 but has also been raised in relation to patents acquired in circumstances where an applicant knows about, but does not alert the Office to, prejudicial prior art (Secretary of State for Health v Servier [2021] UKSC 24) (and relatedly where patentees make use of divisionals to deter competitors from entering the market – as the European Commission found in the Teva Pharmaceuticals case, AT.40588 Teva Copaxone (31 Oct 2024); second, abuse in claiming ownership of such rights (as occurred in the Bitcoin case itself) and as mentioned by the UKIPO in Consultation on Changes to the UK Design Framework (4 September 2025), [4] (“We are also aware that some applicants are abusing the system and seeking to register designs for well-known products, or products which don’t belong to them”); third, abusive maintenance of IPRs, most obviously by entering deals with potential challengers so that invalid IPRs remain on the relevant register (“pay-for-delay” or “reverse payments”); and, finally, abuse in asserting or seeking to enforce IP rights – including “speculative invoicing”, trade mark bullying (especially by big brands against small businesses), making wrongful threats, application for interim injunctions, etc., in relation to obviously invalid rights.
While mapping the points at which abuse might occur is itself valuable, what is less self-evident is what are the features that make acquisition, maintenance and enforcement of IPRs “abusive”? Of course, “abuse” must at the very least include fraudulent acquisition or rights and remedies based on intentional misrepresentation. In Skykick, the Court based its approach on the fact that the essential function of a trade mark is to indicate origin, which requires that it be used in relation to goods/services for which it is registered. This consensus as to purpose, enabled the courts to indicate other situations in which applications for trade marks would not have been in good faith. Another form of abuse may occur where a right is “weaponized” for some other purpose, as where copyright is deployed to silence, IP rights are invoked to prevent repair, or digital rights management to prevent switching. Another form of “abuse” may be the use of one form of IPR to undermine limitations built into other IPRs, or indeed into other rights (such as property rights). A further form of abuse may occur where a right is used as a mechanism to extort payments that significantly exceed the value of any right infringed. Is SEP owner hold-up in FRAND disputes, for example by instigating proceedings elsewhere, a form of abuse? (Panasonic Holdings Corp v Xiaomi Technology UK Ltd [2024] EWCA Civ 1143; Alcatel Lucent SAS v Amazon Digital UK Ltd [2025] EWCA Civ 43; Lenovo Group Ltd v Ericsson Ltd [2025] EWCA Civ 182).
However, it is not always easy to be certain which claims to, maintenance of and enforcement of intellectual property rights are “abusive”, especially where parties are operating with high levels of uncertainty. Professor Sganga has sought to identify criteria for abuse built around four elements: use of a right in a way that harms the interests of others disproportionately and without an objective justification based on the function of the right (reasonableness): Caterina Sganga and Silvia Scalzini, “From Abuse of Right to European Copyright Misuse: A New Doctrine for EU Copyright Law” (2017) 48(4) IIC 405-435, Available at: https://ssrn.com/abstract=2826240 or http://dx.doi.org/10.2139/ssrn.2826240
What mechanisms exist to respond to such abuses where they can be identified? In relation to wrongful acquisition, the most obvious sanction is invalidity: a right improperly applied for should be held invalid. In some situations, the temptation to abuse intellectual property rights has been anticipated within internal substantive rules (for example, to prevent trade mark rights being used to protect patentable inventions) or procedural rules (such as duties of disclosure and candour in US law): see e.g, J.J. Lee, ‘Double Standards’ (2020) 61 Boston College L R 1613. In relation to wrongful claims to ownership, it is possible to seek declarations and, in appropriate cases, publicity orders to help correct misunderstandings. In relation to wrongful enforcement, apart from the prospect of costs orders (and limitations on costs orders that allow impecunious defendants to defend claims against them without exposure to heavy costs liabilities), there are further possibilities of liability (in relation to interim relief) based on cross-undertakings, actions for damages based on wrongful threats (including take-downs, Nocu Co v Shenzhen Carku Technology Ltd [2023] EWCA Civ 1502), injurious falsehood and even proceedings for malicious prosecution.
Are the mechanisms “effective”? If not, what alternatives might be suggested? Following Skykick, is the prospect of invalidity a sufficient disincentive to prevent big operators from applying for and maintaining trade marks even though they have no intention of using them? Is something more penal required? In the US, the penalty for a fraudulent application to the USPTO is the complete invalidation of the trade mark or patent (not just the particular parts of the application to which the fraud relates). Are further incentives needed to encourage invalidity proceedings? What might these be? In relation to registered designs, the IPO is consulting on a range of possible solutions to reduce abuse (such as examination, examination prior to enforcement, refusal on the basis of absence of good faith, oppositions and observations). Would the cure (for abuse) be worse than the disease? Might professional ethical obligations of patent and trade mark attorneys usefully be strengthened? Does the UK need a doctrine of “inequitable conduct” or “fraud on the IPO”?
Where an operator occupies a dominant position, competition law offers remedies for abuse. Teva Pharmaceuticals was fined over £400 million for its misuse of divisionals and disparagement of the generic competitors’ products. In relation to abusive maintenance through reverse payments, US and EU competition law have taken on a significant roles (since FTC v Actavis and Generics v Lundbeck, Case C-591/16P), with parties to such agreements sometimes being subjected to significant fines.
In relation to enforcement, how far do basic principles such as “proportionality”, deployed for example in Golden Eye v Telefonica (2011) offer sufficient protection against abuse? In relation to patents, should the benefit of any cross-undertaking for interim relief be extended to non-parties who suffer (as is possible under Civil Procedure Rules, 25.9, para 5), such as the National Health Service? Should the proceedings for wrongful threats be extended to unregistered, as well as registered, IPRs?
The concept of abus de droit which has been adopted by EU law in various places and is now fairly well recognised (including in English decisions). Would a doctrine of “abuse of right” curtail such practices?
Enquiries to: cipil@law.cam.ac.uk
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