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8 Dicembre 2021
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MEDIATION

NOTICE: the following explanation summarizes just some parts of the current Italian and European Union legislation on mediation of disputes in civil and commercial matter, MFSD Mediation Procedure Rules, MFSD Code of Ethics and MFSD Schedule of Fees. This summary does not replace the careful reading and thorough understanding of the abovementioned documents available in the section Rules of this website. For any further information please contact Pierfrancesco C. Fasano, Mediation Director: mediation@mfsd.it or ph +39 02 82 913 647.

ITALY AND IP DISPUTES

In Italy, like in most countries in the world, intellectual property (IP) disputes deal with highly technical issues that involve considerable professional and court fees. Normally, an Italian court (even IP sections) will take from two to four years to hand down its decision, whereas urgent procedures may entail six to eighteen months. Outcomes are mostly unforeseeable as court decisions tend to be appealed all the way up to the High Court (Corte di Cassazione), which in turn will take another six to eight years to issue a judgment.

The need of faster and efficient solutions to conflicts has opened up the path to experimenting with the tool of mediation on IP disputes.

AIMS

Implementing European Union Directive 2008/52/EC, Italian Legislative Decree 28/10 introduced mediation for civil and commercial disputes. The main objective was to reduce the inflow of new cases into the Italian judicial system and to offer individuals and companies a simple instrument that may provide fast results with predictable costs.

MEDIATORS AND MEDIATION CENTERS

The mediation process may be performed individually, by one person, or collectively by more persons (co-mediators), who will try to bring the parties to a settlement of their dispute but without decision-making powers and who may not hand down binding judgments. The mediator is a professional who must be and stay impartial and who must have received the necessary training (and keep updated) from an authorized mediation training center supervised by the Italian Ministry of Justice and registered with the appropriate mediation entities (private and public). The centres where the mediators provide their services are supervised by the Italian Ministry of Justice. The mediation of conflicts is conducted in mediation centres with the Italian Ministry of Justice in compliance with all the Italian and European applicable laws, with the Ministry’s regulations and according to their own rules, which must be approved by the Ministry of Justice.

TYPES OF MEDIATION

There are three types of mediation:

Voluntary, there are few mediation centers specialized in IP disputes, a subject-matter where mediation (in absence of a pre-existing covenant) is optional and therefore voluntary (i.e., not imposed by the law), that is, one party or both parties by mutual agreement may freely chose to resort to mediation.

Referred, where the nature and the status of the cause so permits and the parties agree, the court (one of the 21 so called Companies Tribunals or the Court of Appeal – Companies Sections) may order the parties to submit their case to mediation with a mediation center. In such case, the mediation or at least the first meeting is mandatory and therefore the statute of limitations is suspended and if mediation fails, parties return to the court.

Mandatory, in the following three cases:

• where the mediation procedure is provided by a contractual clause (e.g. a license agreement or a general settlement agreement)
• Where the parties to a dispute decide to sign a mediation agreement. Some entities provide a specific model clause for disputes over IP matters or a free-of-charge service of assistance for the drafting of an ad hoc mediation clause
• the court, including the appellate court, orders the parties to refer to mediation.

WHEN AND WHEN NOT

A mediation procedure is not useful and effective for every IP disputes. International publications and practical cases involving this matter offer some helpful examples to the parties and their representatives (IP attorneys and lawyers), and even to the judges, on when to use mediation and when not to.

Favourable circumstances are:

• high court fees, disproportionate to the value of the dispute
• a desirable fast solution
• where the complexity of the issues of law, the facts and the relations existing among the parties will likely lead to a long suit that will probably be appealed
• multiplicity of actions between the parties in Italy and abroad
• uncertainty as to the results in case of a lawsuit
• existence of commercial relations and a general interest to continue and to protect such relations.
• importance of keeping the controversy confidential
• motivations of relative nullity of an intellectual property rights
• fear that the prospective decision sets a legal precedent
• inventions by employees
• lack or insufficient evidence to initiate a lawsuit with a court
• refusal by the IT Provider to transfer the domain name to the owner of IP rights because of arrears in the payment of hosting/annual registration fees/ website graphics, etc.

Unfavourable circumstances are:

• Intentional or bad faith infringement, piracy
• A party is unwilling to negotiate and/or anchored to positions of principle.
• Need of urgent/interim measure
• Lack of interest to continue relations
• Need to set a precedent
• Need of publicity
• Motivations of absolute nullity of the industrial or intellectual property title
• The subject matter of the dispute is the payment of a sum and the debtor is insolvent

PRELIMINARY INFORMATIONAL MEETING

Not every IP dispute may be successfully subjected to mediation. Therefore, even if not mandatory by the law, it is advisable that the parties take part in an informative for free meeting in which a Mediator will inform the parties or their representatives (IP attorneys or lawyers) on the nature of the mediation procedure, for example, duration of the process, costs, powers of the mediator and characteristics of the mediator. In this way the parties may better evaluate the conditions for starting the mediation. This meeting will be confidential and the results will not be binding on the parties.

If a party shows its intention to submit a dispute to mediation but is not certain of the concurrence of the other party, the first party may send a request (even by e-mail) with an indication of the subject-matter and the value of the dispute, so that the mediation center invites the other party. Mediation Center will contact the other party and check its availability for the mediation. If the answer is positive, the mediator center will arrange the date, time, place or mode (in presence or remote) for the meeting of the Mediation Case Manager with the parties or their representatives (IP attorneys, lawyers, etc.). Then, invitations will be sent to those concerned. The invitation will include the subject-matter of the dispute and mention the intention of one of the parties to submit the question to mediation, offering to arrange a preliminary meeting to receive information.

In this meeting, the mediator will hear the parties while refraining from entering the merits of the controversy. The parties will receive an explanation about the aim and the scope of the mediation, the procedure, the rules, the advantages and the possibilities offered to the parties versus court procedures, the duration, costs and the possibility to maintain any commercial relations existing between the parties.

The parties may request further Mediator explanations on the procedures and verify, with the help of the Mediator

• whether all the parties to the dispute attending are available to participate in the mediation
• whether the dispute appears (at least in principle) likely to be settled by a alternative procedure to court litigation
• whether there exist the conditions and a mutual interest to look for a solution other than a lawsuit
• whether there is a firm will to negotiate.

The result of the meeting may be:

positive (that is, the invited party decides to join, or both parties decide to start the mediation). The mediator will then invite the parties to agree on a date for the filing of a joint request, to set the date of the first mediation meeting and establish the cost of the procedure, which can differ from the fees normally applied by the mediation center, with its consent. Minutes (verbale) of the commencement of the mediation procedure will be drawn up, as well as a schedule of the procedure.
negative (that is, lack of an agreement or lack of interest in the mediation). No minutes (verbale) will be drawn up.

This preliminary meeting will allow the parties to assess, at a low cost (except for attorney fees), while preserving their confidentiality and without assuming any binding commitments, the existence of propitious conditions and of an actual mutual intent to submit the case to mediation. They will therefore be able to make a conscientious and knowledgeable decision on whether to adhere or not to the mediation.

ADVOCACY

For an IP dispute, the parties may, and the mediation center will recommend so, take part in the mediation procedure with the attendance of an IP Attorney or lawyer. A well established international practice also for IP attorney is to discuss and explain the client the methods of out-of-court resolution such as the mediation, expert determination, arbitration, domains mandatory administrative proceeding, according to the so called ‘Alternative Dispute Resolution Pledge’ approach (see for instance, INTA Pledge or 21st Century CPR Pledge).

When a settlement is reached, the parties and their lawyers sign an agreement that is enforceable. If parties are not advocated by lawyers (i.e. by an IP attorney) the settlement agreement is attached to the minutes and the parties may request that the President of the Court valid the settlement by issuing the pertaining decree.

PROCEDURE

The mediation starts by filing a request with the mediation center in the territory where the court has jurisdiction and where, if the parties so confirm, the mediation will be conducted. However, according to the Italian ministerial rules, the request should be filed (also online) with the registered office of the mediation center. Upon reception of center the request, the mediation center will provide the name and background information of the mediator, the place (the nearest possible, if the meeting is to take place in person by the parties), the date and the time of the preliminary meeting. The request will include the details of the mediation center, of the parties’, the subject-matter of the claims and allegations in support thereof.

The request for mediation and acceptance by the party invited may be filed:
by e-mail: responsabile@mfsd.it
by telefax +39 02 91471087
in person, with a previous appointment by e-mail (responsabile@mfsd.it). 

The Italian mediation law provides that the documents of request and acceptance may only be filed with the registered office of the mediation center, whereas the meetings may take place at any operative offices or at any other place that the parties and the mediation center may decide. If more than one application is filed, the mediation will be conducted with the mediation center where the first application was filed and served on the other party.

After commencement of the mediation procedure, the Mediator organizes one or more meetings, including distant meetings (for instance audio o video conferences) in view of reaching a disputes settlement.

An agreement accomplished with the assistance of the Mediator will be approved by the competent court having territorial jurisdiction over the registered office of the mediation center; the agreement becomes enforceable in Italy and in all other countries of the European Union, except for Denmark. If no agreement is reached, with the prior consent of the parties, the mediator may file a proposal of settlement of the dispute, which the parties will be free to accept or reject.

In case of failure of the mediation and if a lawsuit follows, the court may verify whether the election of the mediation center was unreasonable, for instance, for lack of any connection between the office of the center and the facts of the dispute, or the place of residence, or the domicile of other party.

DURATION

The Italian law allows a maximum term of 3 months for the mediation process. A typical civil lawsuit involves an initial 90-day pause between the service of the summons and complaint to the defendant and the first court hearing. In addition, it is a consolidated practice that on this first hearing one of the parties requests an additional postponement for another 80 days.

The mediation allows attempting conciliation simultaneously with the initiation of a lawsuit in a court and therefore without adding additional time to the judicial proceedings. The process is not suspended during the judicial vacation (August 1st through 30rd). The period of time involved in the mediation procedure may not be calculated in establishing the reasonable duration of a court case set out in Article 6 of European Convention on Human Rights.

MEDIATOR’S PROPOSAL

The parties may, by mutual agreement, request that the mediator provides a proposal to their conflict. If this proposal is not accepted and a cause is instituted or continued with a court, if the court’s decision on the case is in agreement with the proposal, the costs of the process will be borne by the party that will have unjustifiably rejected the conciliating solution proposed by the mediator.

CONFIDENTIALITY

By law:

• no declarations made or information provided by the parties in the context of the mediation procedure may be used in a judicial process
• no declaration or information data revealed by one party only to the mediator may be revealed to the other party and any violation to this rule will be sanctioned
• no confidential information revealed shall be used in a subsequent court case.

RESULTS AND EFFECTS

When the parties are assisted by a lawyer, the minutes of the settlement agreement signed by the parties and by their lawyer will become officially enforceable with respect to disposals, delivery and release, the obligation to do or not to do something and the registration of a judicial mortgage into re estates public registries. The lawyer will witness and certify that the settlement agreement comply with to the Italian law and the public order.

In all other cases, upon the request of one of the parties, the validity of the settlement attached to the minutes of the conciliation agreement will be confirmed by the court and will become enforceable with respect to disposals, specific performance and the registration of judicial mortgages into re estates public registries.

Once confirmed by an Italian court and where the unperformed obligation consists of the payment of a monetary sum, the settlement agreement and the minutes of the conciliation achieved during a mediation procedure in Italy may also be enforced in another Member Country of the European Union, except for Denmark (considered as an automatic acknowledgement or free circulation in EU).

COURT REFERRAL

During a mediation procedure, any party may request the court’s intervention concerning measures that are urgent under the law and should not be delayed. In addition, after evaluating the nature of the case, the status of the investigation and the behavior of the parties, a court, including an appellate court, may order the parties to submit to mediation.

EFFECTS OVER COURT AND ATTORNEY FEES

The mediation procedure may also influence the cost of a subsequent lawsuit. At the end of the trial, there are two options: that the court decision coincides with the proposal delivered by the mediator or that the court decision is different from the proposal delivered by the mediator. If the court’s decision fully coincides with the contents of the conciliation proposal the court may:

• refuse awarding reimbursement of the court and lawyers fees to the winning party if it had rejected the mediator’s proposal, proportionately to the period following the proposal, and
• condemn such party to the payment of the court and lawyers fees corresponding to the losing party for the same period, as well as to the payment of the court fee and the fee due to the mediator and to any experts that may have been appointed.

If, on the other hand, the court decision does not fully coincide with the contents of the proposal, for serious and exceptional reasons, the court may deny the reimbursement of the attorneys (at-law or Intellectual Property) fees to the winning party with respect to the compensation to the mediator and any expert witnesses. Upon the unjustified refusal to participate in the mediation procedure by one party, the court may infer arguments of evidence in a subsequent lawsuit. In addition, when submitting to mediation is a pre-condition for the initiation or continuation of a lawsuit (mandatory mediation), the court may condemn a party that has unjustifiably not participated in the mediation to the payment of a sum equivalent to the court fee.

COSTS

In IP disputes mediation costs are charged by mediation center on mediation agreement basis reached during the preliminary for free informational meeting or, in absence, upon schedule of fees approved by Italian Ministry of Justice. MFSD as private mediation center and parties are free to agree costs reduction or devise contingency fee payment scheme. Public mediation centers costs are fixed by ministerial rules.

© All rights reserved

VIDEOS

Right, top. Mediating Intellectual Property, CEDR.

Left, top.
 Interview at Andrew Hildebrand, Commercial Mediator, on skills and issues of a professional mediator (Intellectual Property Office).

Left, bottom. International Trademark Association (INTA) and the International Institute for Conflict Prevention & Resolution (CPR) Peter Müller.

This video involves a business dispute between a Russian distillery and an American manufacturer and distributor of alcoholic beverages. Allegations of unfair trade practices, trademark and trade dress infringements and bad faith pirating dominate the dispute. The video uses an actual INTA mediator and INTA members as talent, and was first shown at INTA's 125th Anniversary Annual Meeting in Amsterdam, The Netherlands. The video also features an accompanying downloadable study guide (see below).

CPR is the copyright owner and has agreed to make this video freely available for non-commercial use. However, where the video is shown to paying audiences (e.g. in a training program or a conference where delegates pay to be present) CPR asks for a broadcast license fee. For more information, please contact CPR (www.cpradr.org). The video is also available from CPR in DVD format.

SOURCES

Mediation Development ToolkitEnsuring implementation of the CEPEJ Guidelines on mediation, Council of Europe, 2018.

The present version comprises the following tools
:

- two checklists to support national authorities in setting up and monitoring court mediation pilots

- a document primarily aimed at judges and court clerks focusing on the judicial referral to mediation

- a basic mediator training curriculum, developed jointly with the International Mediation Institute (IMI)

- an awareness raising document for main stakeholders of mediation, in the form of Frequently Asked Questions (FAQ)

- a Guide to mediation for lawyers, developed jointly with the CCBE.

PDF
Intamediationvideostudyguide
1 MB
[youtube=https://www.youtube.com/watch?v=ApFTydq4kFo]
[youtube=https://www.youtube.com/watch?v=3UlalDWeNZo]
[youtube=https://www.youtube.com/watch?v=xTbj-eHwX-w]
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