Arbitration is an essential part of an ownership dispute.


The prevalence of intellectual property rights in international and commercial settings makes it more difficult for parties to go to court. There may be:

  • Different jurisdictions can lead to a conflict of law because different courts may apply different rules.
  • Because it is a tedious and time-consuming process
  • Secret information is not to be released into the public domain to prevent communication of confidential communication.
  • Recognizing the theory of intent of the parties to choose the best place for their contract to be governed or the seat for arbitration, it is more convenient for them to seek arbitration to resolve any ownership disputes between them.

It is easy to argue that arbitration of Intellectual Property Ownership disputes is better than proceeding with traditional courts. However, this contention comes with some inherent problems.

  • The infringing parties may refuse to accept the arbitration
  • Sometimes, the aggrieved party may not be aware of the infringing party. In such cases, it is necessary for the party that goes to court to ask the court to issue an Ashok Kumar/John Doe order.

Because of the inherent conflict, the topic been widely discussed the limits and scope of arbitrability for certain IP rights. Arbitrating Intellectual Property disputes are among the most controversial issues in IP arbitration.

Courts increasingly use ADR procedures to reduce the burden on the judiciary and courts. Arbitration is a relatively new legal strategy in India. Because it involves a contentious topic regarding intellectual property rights, it has raised many issues that the court should consider. Any disputing party prefers to resolve the dispute through discussions rather than lengthy legal proceedings. It was possible to see the IP dispute parties moving towards arbitration. This article provides an overview of IP dispute arbitration.

Relationship between IPR and arbitration

Arbitration is an emerging method of resolving disputes regarding ownership of Intellectual Property. It is a special process for dispute resolution that the parties adopt. This makes institutional arbitration particularly important in the context for opening up the economy. In addition to having rights under Intellectual property, it is important to establish strong enforcement mechanisms. Arbitration is private and confidential, so it is appropriate that the parties choose an ADR mechanism to resolve their dispute, especially if they are from different jurisdictions.

The panel of institutions that constitute institutional arbitration appoints the arbitrators based on their expertise in many areas. This is in contrast to being ” ad-hoc” by the courts or the parties to a dispute through a mutual or dispute resolution agreement. The institution-set norms governing fees are also applicable to these arbitrators. This is becoming common in all three sectors, especially when international transactions are involved. The applicable law can differ from country to country and requires a high level of specialization. The urgency of the situation is another common feature. Patents are limited, and technology is subject to rapid obsolescence. This makes it difficult for courts to resolve disputes quickly, which can harm the interests involved. Therefore, these industries can reap the benefits of arbitration, which is especially beneficial. Implementing an ADR mechanism or arbitration can take time because it involves resolving intellectual property rights disputes. This is due to the issue of whether its subject matter is arbitrable.

Because intellectual property rights are territorial, they derive their power from the legal protection it is granted by local laws or the sovereign power of the local country. This creates and guarantees certain exclusive rights for the use and exploit of said intellectual property. Many have argued that because the dispute is of territorial nature, it should be resolved by the authority that granted them such rights, or in certain circumstances by the courts in that country.

An arbitration tribunal could not assess or refer rights and entitlements to intellectual properties or legal challenges that may arise from them. If the parties agree to commercial agreements regarding the creation, use marketing or transfer of granted IP rights, any conflicts that result from these agreements can be resolved without any dispute over the arbitrability. These disputes are usually viewed as commercial disputes between inner party and are dealt with by tribunals.

In a series of cases, the United States Supreme Court examined the question of “Why arbitration is used to resolve disputes in Intellectual Property Rights conflict?” The answers were dependent on specific circumstances.

In the case of AT&T Technologies, Inc. against Communication Workers of America (1986), , gave an answer to the above question. The court stated that , unless the parties explicitly and clearly provide otherwise, it is up to the competent court and not the arbitrator to decide whether the parties have contractually agreed or not to arbitrate a matter.

Similar cases have resulted in similar outcomes, such as Granite Rock Co. V. International Brotherhood of Teamsters (2008) . In this case, arbitration can only be ordered if the court is certain that the parties have reached an agreement to arbitrate the case and that they consent to it being arbitrated.

In Rent A Centre West West v. Jackson (2010), however, the U.S. Supreme Court ruled that an arbitrator can decide whether an issue is subject or not depending on whether the parties expressly and unambiguously state that it will be subject to arbitration. Furthermore, an agreement to arbitrate threshold issues is not challenged.

Arbitration in IP disputes is rare as these disputes don’t involve any pre-existing contractual relationships with other parties or infringing parties. To have a matter arbitrated, however, the parties must have a contractual relationship. Very few countries prohibit arbitral tribunals from making an award on the issue of patent invalidity. This defense is often used when an action is brought under a license agreement. These disputes are usually litigated in the country’s court of law with territorial jurisdiction over the subject matter. Although some restrictions under public policy prohibit the arbitration of IP disputes in certain nations, arbitration is generally compatible with the public policy of most jurisdictions. The reasons not to arbitrate intellectual property disputes are limited. However, the parties should still decide how arbitration should be structured and what elements should be considered.

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