1. WIPO ARBITRATION AND MEDIATION CENTER www.wipo.int 1 Ignacio de Castro WIPO Arbitration and Mediation Center Mediation and Arbitration at WIPO LLM in Intellectual Property December 1, 2006

2. WIPO ARBITRATION AND MEDIATION CENTER www.wipo.int 2 WIPO Arbitration and Mediation Center Established October 1994 Purpose: –to provide services for the resolution of commercial disputes between private parties involving intellectual property (IP) and technology, through mediation and arbitration Background: –Internationalization of creation and use of IP: need for cross-border solutions –Technical and specialized nature of IP: need for specific expertise of ‘neutral’

3. WIPO ARBITRATION AND MEDIATION CENTER www.wipo.int 3 Roles of the WIPO Center: Resource center: –IP ADR guidance, workshops, conferences, publications Administering authority: –Contract clauses and rules for IP disputes WIPO (Expedited) Arbitration WIPO Mediation –Administration of cases –WIPO list of arbitrators, mediators, experts

4. WIPO ARBITRATION AND MEDIATION CENTER www.wipo.int 4 WIPO Domain Name Dispute Resolution

5. WIPO ARBITRATION AND MEDIATION CENTER www.wipo.int 5 Uniform Domain Name Dispute Resolution Policy The domain name is identical or confusingly similar to a trademark or service mark, and The domain name holder has no rights or legitimate interest in respect of the domain name, and The domain name has been registered and is being used in bad faith.

6. WIPO ARBITRATION AND MEDIATION CENTER www.wipo.int 6 Mediation and Arbitration Experience

7. WIPO ARBITRATION AND MEDIATION CENTER www.wipo.int 7 Mediation and Arbitration Experience Statistics: 54 mediations, 63 arbitrations, Procedures in English, French and German involving parties from 16 countries Subject Matter  Contractual Patent licenses, distribution agreements, R&D, joint ventures, software/IT, copyright collecting societies, trademark coexistence agreements, art marketing, settlement agreements, etc.  Patent infringement: Later submission Sectors: IT/telecom, pharma/biotech, medical devices, consumer goods, art

8. WIPO ARBITRATION AND MEDIATION CENTER www.wipo.int 8 WIPO Mediation and Arbitration

9. WIPO ARBITRATION AND MEDIATION CENTER www.wipo.int 9 Procedures Offered: Options

10. WIPO ARBITRATION AND MEDIATION CENTER www.wipo.int 10 Mediation and Arbitration Mediation: non-binding procedure in which a neutral intermediary, the mediator, assists the parties in reaching a settlement of the dispute Arbitration: a neutral procedure in which the dispute is submitted to one or more arbitrators who make a binding decision on the dispute

11. WIPO ARBITRATION AND MEDIATION CENTER www.wipo.int 11 Advantages One procedure relating to IPR protected in several countries Choice of mediator, arbitrator or expert Flexible procedures Confidentiality Time and cost

12. WIPO ARBITRATION AND MEDIATION CENTER www.wipo.int 12 Advantage: Neutrality International disputes: avoid risk of home court advantage, choice of: –arbitrator / médiator –language –applicable law –place of arbitration

13. WIPO ARBITRATION AND MEDIATION CENTER www.wipo.int 13 WIPO Mediation Clause Any dispute, controversy or claim arising under, out of or relating to this contract and any subsequent amendments of this contract, including, without limitation, its formation, validity, binding effect, interpretation, performance, breach or termination, as well as non-contractual claims, shall be submitted to mediation in accordance with the WIPO Mediation Rules. The place of mediation shall be [New York]. The language to be used in the mediation shall be [English]

14. WIPO ARBITRATION AND MEDIATION CENTER www.wipo.int 14 Mediation Process COMMENCEMENT APPOINTMENT OF MEDIATOR INITIAL CONFERENCE MEETINGS CONCLUSION

15. WIPO ARBITRATION AND MEDIATION CENTER www.wipo.int 15 WIPO Mediation Example (1) Patent infringement dispute –R&D company holding patents disclosed patented invention to manufacturer during consulting contract. –No transfer or license of patent rights –Manufacturer started selling products which R&D company alleged included patented invention –Negotiation patent license failed –Parallel infringement proceedings in several jurisdictions? Parties submitted to WIPO Mediation

16. WIPO ARBITRATION AND MEDIATION CENTER www.wipo.int 16 COMMENCEMENT APPOINTMENT OF MEDIATOR Request for mediation  Mechanics - Arts. 3-5  Administration fee - Art. 21  Statute of limitations Appointment of mediator  Parties or Center after consultation - Art 6 Commencement and Appointment of the Mediator

17. WIPO ARBITRATION AND MEDIATION CENTER www.wipo.int 17 Mediation Sessions INITIAL CONFERENCE MEETINGS APPOINTMENT OF MEDIATOR COMMENCEMENT Alternatives to settlement  Risk and cost of litigation Interests of the parties  Use of patented technology vs. further business Settlement options  Mutual interest in cooperation

18. WIPO ARBITRATION AND MEDIATION CENTER www.wipo.int 18 Conclusion of the Mediation Settlement agreement  Here:  license and agreement on further business relationship  Total duration: 4 months  mediator’s fees: 24,000  Enforceable under contract law  But usually voluntary compliance Termination  Withdrawal by one or both parties after the first meeting  Decision of the mediator INITIAL CONFERENCE MEETINGS APPOINTMENT OF MEDIATOR COMMENCEMENT CONCLUSION

19. WIPO ARBITRATION AND MEDIATION CENTER www.wipo.int 19 US software provider licensed software applications to European telecom provider:  10 named users  WIPO Mediation followed by WIPO Expedited Arbitration  Place mediation: Paris, applicable law: English Request for Mediation:  Alleged breach of license: more than 50 users  outstanding fees: USD 10 million  European telecom asked to provide list of unauthorized users  No settlement, but issues narrowed down  Total duration: 2 months, mediator ’s fees: USD13,000 WIPO Mediation Example (2)

20. WIPO ARBITRATION AND MEDIATION CENTER www.wipo.int 20 WIPO Arbitration Clause Any dispute, controversy or claim arising under, out of or relating to this contract and any subsequent amendments of this contract, including, without limitation, its formation, validity, binding effect, interpretation, performance, breach or termination, as well as non-contractual claims, shall be referred to and finally determined by arbitration in accordance with the WIPO Arbitration Rules. The arbitral tribunal shall consist of [a sole arbitrator]. The place of arbitration shall be [New York]. The language to be used in the arbitral proceedings shall be [English]. The dispute, controversy or claim shall be decided in accordance with [New York] law.

21. WIPO ARBITRATION AND MEDIATION CENTER www.wipo.int 21 Enforcement Arbitral Award New York Convention Recognition and Enforcement of Foreign Arbitral Awards (139 signatories): almost automatic enforcement of awards, exceptions Art. V: lack of party capacity party was not given proper notice or was unable to present its case difference not contemplated in the submission to arbitration subject matter not arbitrable award contrary to public policy

22. WIPO ARBITRATION AND MEDIATION CENTER www.wipo.int 22 Two exchanges of pleadings: 1) Request “Testing the water” Statute of limitations Answer 2) Appointment: impartiality, independence, challenge 3) Full Statement of Claim After Tribunal appointment Statement of Defense Party autonomy Flexibility Efficiency Rules on technical evidence Confidentiality provisions

23. WIPO ARBITRATION AND MEDIATION CENTER www.wipo.int 23 WIPO Arbitration: Example R&D Exclusive R&D and licensing agreement biotech co. and pharma co. Alleged delays development and regulatory approval biotech compound. R&D entity terminated agreement started WIPO arbitration proceedings Arbitrator expert in biotech-pharmaceutical Two-day hearing Settlement agreement

24. WIPO ARBITRATION AND MEDIATION CENTER www.wipo.int 24 Trademarks Arbitration US University holds trademarks for software in US Asian company holds trademarks for hardware in Asia Trademark coexistence agreement includes WIPO arbitration clause WIPO arbitration Sole arbitrator issued a preliminary award providing that Asian company should grant a license to the US University

25. WIPO ARBITRATION AND MEDIATION CENTER www.wipo.int 25 One exchange of pleadings Shorter time limits Sole arbitrator Shorter hearings Fixed arbitrator’s fees

26. WIPO ARBITRATION AND MEDIATION CENTER www.wipo.int 26 WIPO Expedited Arbitration: Flexibility Example I: Insurance –Both parties see urgency and agree on short deadlines –Only one issue in dispute –One day hearing –Final Award: 5 weeks Example II: Exclusive Patent License –Dispute involving one European patent and 5 US patents –Arbitration clause: infringement and contractual claims –Complex legal and technical issues –Business secrets, models, site visits –Eight days hearing –Final Award: 15 months

27. WIPO ARBITRATION AND MEDIATION CENTER www.wipo.int 27 Mediation followed by Arbitration Try mediation before arbitration If mediation fails: arbitration well- prepared "Any dispute, controversy or claim arising under, out of or relating to this contract and any subsequent amendments of this contract, including, without limitation, its formation, validity, binding effect, interpretation, performance, breach or termination, as well as non-contractual claims, shall be submitted to mediation in accordance with the WIPO Mediation Rules. The place of mediation shall be [London]. The language to be used in the mediation shall be [English]” If, and to the extent that, any such dispute, controversy or claim has not been settled pursuant to the mediation within [60][90] days of the commencement of the mediation, it shall, upon the filing of a Request for Arbitration by either party, be referred to and finally determined by arbitration in accordance with the WIPO Arbitration Rules. Alternatively, if, before the expiration of the said period of [60][90] days, either party fails to participate or to continue to participate in the mediation, the dispute, controversy or claim shall, upon the filing of a Request for Arbitration by the other party, be referred to and finally determined by arbitration in accordance with the WIPO Arbitration Rules. The arbitral tribunal shall consist of [a sole arbitrator]. The place of arbitration shall be [London]. The language to be used in the arbitral proceedings shall be [English]. The dispute, controversy or claim referred to arbitration shall be decided in accordance with [English] law."

28. WIPO ARBITRATION AND MEDIATION CENTER www.wipo.int 28 WIPO Arbitration Schedule of Fees

29. WIPO ARBITRATION AND MEDIATION CENTER www.wipo.int 29 Drafting Arbitration Clauses Examples of defective arbitration clauses Essential elements: applicable rules number of arbitrators place of arbitration language governing law

30. WIPO ARBITRATION AND MEDIATION CENTER www.wipo.int 30 WIPO Arbitration Clause Any dispute, controversy or claim arising under, out of or relating to this contract and any subsequent amendments of this contract, including, without limitation, its formation, validity, binding effect, interpretation, performance, breach or termination, as well as non-contractual claims, shall be referred to and finally determined by arbitration in accordance with the WIPO Arbitration Rules. The arbitral tribunal shall consist of [a sole arbitrator]. The place of arbitration shall be [New York]. The language to be used in the arbitral proceedings shall be [English]. The dispute, controversy or claim shall be decided in accordance with [New York] law.

31. WIPO ARBITRATION AND MEDIATION CENTER www.wipo.int 31 Defective Clauses (1) Arbitrage à Genève. Any disputes shall be solved by arbitration between the parties; failing that, arbitration in the English language shall be conducted in Houston, according to the Paris Convention, which shall be final and binding upon de parties.

32. WIPO ARBITRATION AND MEDIATION CENTER www.wipo.int 32 Defective Clauses (2) Disputes relating to patent infringement shall be finally determined in accordance with the WIPO Expedited Arbitration. Contractual disputes [different institution]. Disputes relating to US patents: US sole arbitrator. Disputes relating to European patents: European sole arbitrator. Award can be challenged and finally determined by arbitration in accordance with the WIPO Arbitration Rules. The tribunal shall consist of three arbitrators.

33. WIPO ARBITRATION AND MEDIATION CENTER www.wipo.int 33 WIPO Electronic Case Facility (ECAF) http://www.wipo.int/amc/en/ecaf/index.html Web-based electronic docket –For WIPO arbitration and mediation cases –Facilitates online communication and storage –Submission in most common formats (word, pdf,..) –Searchable by author, date, subject title –Email alerts Security –Authentication + Encryption + Firewall

34. WIPO ARBITRATION AND MEDIATION CENTER www.wipo.int 34 WIPO ECAF Docket

35. WIPO ARBITRATION AND MEDIATION CENTER www.wipo.int 35 WIPO ECAF Case Management

36. WIPO ARBITRATION AND MEDIATION CENTER www.wipo.int 36 WIPO ECAF Case Management

37. WIPO ARBITRATION AND MEDIATION CENTER www.wipo.int 37 WIPO Arbitration and Mediation Center International and neutral Not for profit: Low fees Expertise: –International legal staff with backgrounds in IP & ADR –Worldwide contacts to expert neutrals Time and cost-effective administration –Active case management –Rules tailored to IP and IT –Expedited Arbitration

38. WIPO ARBITRATION AND MEDIATION CENTER www.wipo.int 38 Information http://www.wipo.int arbiter.mail@wipo.int Mailing lists  http://www.wipo.int/amc/en/subscribe/