Intellectual property disputes will continue to rise

After an increase in the number of arbitration disputes in the wake of the departure of foreign companies from Russia in 2022, the number of arbitration cases then began to decline, according to a study by the Kontur.Focus service. But at the same time, Russian companies are increasingly suing over copyright and intellectual property (IP) protection. The increase in the number of such disputes is explained by the desire of Russian companies to become owners of trademarks similar to the marks of departed foreign companies, the emergence of new Russian brands and business interest in the commercialization of intellectual property.

According to a study by the Kontur.Focus service, the number of arbitration disputes in Russia over the past two years has decreased by 12%: if in 2021 there were 1.46 million, then in 2023 – 1.29 million. And all this the reduction took place in 2023, since in 2022, against the backdrop of the departure of foreign companies from the Russian Federation, it increased slightly – to 1.48 million. Then the number of disputes related to the protection of copyright and related rights, as well as the protection of intellectual property, sharply increased – up to 9.2 thousand and 9 thousand, respectively, after 5.7 thousand and 5.9 thousand in 2021. In 2023, despite the overall decrease, the number of such disputes increased further – to 13 thousand and 11.8 thousand.

As Semenov&Pevzner partner Yulia Yarnykh explains, the cessation of business in Russia for many copyright holders meant the cessation of any activity, including the protection of their intellectual rights. However, a number of Russian companies took advantage of the opportunity: entrepreneurs often sued out of a desire to become owners of trademarks similar to the marks of departed foreign companies. “Since Rospatent refused to register such marks, entrepreneurs went to court to challenge the decisions. Disputes have arisen between competing suppliers trying to challenge the registration of marks of foreign companies that have completed their work,” says Artem Denisov, managing partner of the Genesis law firm. Yulia Yarnykh explains the increase in the number of disputes and import substitution: in two years, a large number of intellectual property objects were created – from fashion brands to software and medicines.

“We increasingly see the principled position of Russian copyright holders on the use of intellectual rights to protect and expand their market share. From an object of legal protection that increases the book value of assets, intellectual property turns into a competitive tool that helps market participants gain additional advantages,” says Alina Akinshina, CEO of Online Patent.

At the same time, as Kontur.Fokus expert Anton Yakovlev says, entrepreneurs sometimes abuse their rights to fight competitors. “The Civil Code provides for compensation for violations of intellectual property rights of up to 5 million rubles. even without proof of damage,” he explains. According to Artem Denisov, the number of IP disputes will continue to grow, especially in 2025, when the three-year period for the use of marks owned by foreign companies expires, which will provide an opportunity for interested parties to achieve early cancellation of their registration in Russia.

In terms of industry, the largest number of disputes is concentrated in construction and real estate: in the last three years, these sectors account for an average of 15% of all cases. Orchards partner Yuri Aksenov explains the persistence of construction companies’ claims burden by the growth of the industry in 2022 and 2023 (more contracts – more conflicts over their execution), as well as changes in the deadlines for the delivery of projects against the backdrop of problems with attracting financing, rising prices for building materials, and a break in supply chains and calculation difficulties. “Similar problems maintain a high level of conflict in the real estate market: many of its participants are unable to agree on the transformation of relations in the changed conditions. This applies primarily to owners and tenants of commercial real estate, as well as management companies of shopping and business centers,” the expert states.

Diana Galieva