Intellectual Property (IP) dispute involves complex technical questions of fact and law. It requires highly specialized knowledge to resolve all the issues presented by the disputing parties.  Generally, the potential benefits of mediation in IP dispute resolution is covered in the following aspect:

• Time and money. IP is central to the business venture of the IP rights owner. A dispute provides uncertainty on the rights and may impact on the potential value of the IP. Moreover, IP, such as invention, utility model and industrial design, exists only for a limited time. Thus, from a point of view of the rights owner, a dispute could limit the time the IP can be exploited which will potentially diminish economic return. Mediation can potentially settle the dispute faster and at lower cost to the parties.
• IP dispute generally involves large corporations due to its commercial nature. During the conduct of court proceedings, the parties may inadvertently divulge of information that may have proprietary value or that may harm their reputation. In some instances, just the filing of a court case to a competitor may subject the parties to public scrutiny which would be detrimental to their corporate image and commercial position. Mediation can provide the parties with a means to keep the proceedings confidential. Mediation promotes party autonomy which translate on how the parties will agree to resolve their conflict.
• Continuing control by the parties over the process. Mediation provides flexibility to the parties not found in litigation and arbitration. It gives the parties leeway on how to design the proceedings. The informal nature of mediation offers an avenue to the parties to arrive at creative solutions in resolving the dispute. Given the monopoly rights of IP, creative solutions may came in a form of licensing, joint collaboration contract, cross-licensing agreements, etc.
• Mediation is particularly helpful if the parties have prior business relationship such as licensee-licensor partnership or collaboration agreement. In such cases, the main priority of the mediation proceedings is to preserve the relationship or leave the settlement with a better relationship.
• Avoids pitfalls of IP litigation. IP litigation relating to patent and trademark case requires that the court makes a determination of the technical questions of fact and law. In the process of determination, the protection sought in the IP rights is subjected to re-interpretation or invalidation. Moreover, in trademark cases, the burden of proof of ownership and prior use is relegated to the trademark owner which will require both time and financial consideration. Specifically, particular instances where IP litigation will be a burden to the parties involve the following:
  • Avoiding claim re-interpretation for patent. In patent infringement, the parties involved are required to re-argue how the patent claim is to be interpreted.
  • Less risk of patent invalidation. In a patent litigation, the court is required to make determination on the validity of the patent.
  • Avoiding the discovery process. Patent legal proceedings may involve some form of discovery in the trial. This will require the services of expert witness which is both time-consuming and expensive.
  • In trademark invalidation cases involving well-known mark, the owner must submit evidence to show presumptive strength and value of the brand. This may involve the conduct of brand survey which is both expensive and exhaustive.

Under the ADR Program of IPOPHL, mediation is part of the adjudication process. Mediation is provided to the parties as the first viable option in resolving their dispute. Once mediation is not successful, the case is submitted to litigation for resolution.

Mediation is a process of settling dispute with the help of a third neutral party called the mediator. The main function of the mediator is to facilitate the discussion and negotiation; and skillfully enjoins the parties to cooperate in order to come up with a mutually satisfactory settlement of their dispute. Mediation resolves disputes quickly and efficiently as parties work together with the mediator in finding a solution beneficial to both parties.

To further provide options to parties in dispute, the IPOPHL considers offering other ADR procedures such as arbitration in facilitating the resolution of IP disputes brought before its jurisdiction.  

Arbitration is described as a binding procedure in which the dispute is submitted to one or more neutrals, called an arbitrator or a tribunal, respectively, who make a final decision on the dispute.

A grievance system for parties in mediation concerning the actions of a mediator in a mediation proceeding is hereby established as follows:

1. Any report/complaint against or incident involving any Mediator must be made known in writing to the Director General. If the complaint or petition is found prima facie meritorious, the Director General shall direct the Grievance Committee to conduct an investigation and to submit a report, which shall include its findings and recommendations, within thirty (30) days from receipt of the directive.
2. An ADR Grievance Committee shall be form to hear and render decision on the complaint on IPOPHL accredited mediators. The committee shall be headed by a Deputy Director General and shall be assisted by the Director of the Bureau of Legal Affairs, the Operations Head of the ADR Services and one mediator to be appointed from the roster of IPOPHL accredited mediators.
3. Due process must be afforded the Mediator concerned.
4. During the period of investigation, the Mediator shall be suspended from handling any mediation cases.
5. The Director General shall review the report submitted by the Committee. If found guilty, the mediator’s accreditation from IPOPHL shall be canceled immediately. The decision of the Director General in respect to the removal of accreditation of a mediator shall be final.

If the mediation is successful, the Alternative Dispute Resolution Services shall, within five (5) days from the parties' submission of their compromise agreement, refer the agreement to the head of the originating bureau/office. The latter shall, within three (3) days from receipt of the draft decision based on Compromise Agreement, approve the same unless the terms or part thereof is contrary to law, public policy, morals or good customs, in which case the agreement shall be sent back to the parties, through the ADRS for revision or modification. Upon parties' revision or amendment of the agreement, the same shall be returned again to the originating office for approval. An approved Compromise Agreement shall have the effect of a decision or judgement on the merits and shall be immediately executory and enforced accordingly in accordance with the pertinent rules of IPOPHL and suppletorily, the Rules of Court. Section 7. (Section 6, IPOPHL Memorandum Circular No. 008, Series of 2018)

Nathaniel S. Arevalo
Director, Bureau of Legal Affairs
Email: nathaniel.arevelo@ipophil.gov.ph
Telephone No.: 7238-6300 local 2101

Christine Pangalinan-Canlapan
Assistant Director, Bureau of Legal Affairs
Email: Christine.pangilinan-canlapan@ipophil.gov.ph
Telephone No.: 7238-6300 local 2201

Luwin M. Dela Concha
Management Operation Officer, Alternative Dispute Resolution Services
Bureau of Legal Affairs
Email: luwin.delaconcha@ipophil.gov.ph
Telephone No.: 7238-6300 local 2601/2602