Costs and security for costs: what the other side does
When the other side in a patent dispute doubts it can recover a costs order later, it applies for security for costs before more work is committed. The application sets out the claimant's financial position, the costs exposure over the stages ahead, and a proposed sum. The panel decides on the papers or after a short hearing, and the underlying dispute pauses until the sum is paid, reduced, or the application is refused.
Why the other side moves early, and what changes once it does
The application is timed to land before the expensive stages of the case, not after. Filing early protects the other side's own budget and puts pressure on the claimant to show it can meet a costs order if the claim fails. Once the application is served, the pace of the whole dispute shifts: deadlines for the next procedural step are usually suspended while the panel considers the request, so the claimant's own filing clock stops as well.
If the panel orders security and the sum is not paid within the set window, the main proceedings can be stayed, and continued non-payment can lead to the claim being struck out. The claimant then carries the burden of showing either that payment has been made or that the order should not have been made at all.
| Stage | What happens | Who acts |
|---|---|---|
| Application filed | The other side sets out the claimant's asset position and the costs at risk over the remaining stages, with a proposed figure | Opposing party's counsel |
| Claimant's response | The claimant challenges the figure, the asset assessment, or the need for security at all | Claimant's counsel |
| Decision | The panel orders security, refuses it, or sets a lower sum, usually on the papers | Judge-rapporteur or panel |
| Payment window | The claimant deposits the sum or provides an equivalent guarantee within the period set by the order | Claimant |
| Consequence of non-payment | The main proceedings are stayed, and continued non-payment can lead to the claim being struck out | Panel, on further application |
What to do once you are served with the application
- Read the proposed figure against your own cost estimate for the stages still ahead, and instruct counsel to flag any inflation the same week.
- Gather evidence of your own financial standing if the application argues that your assets sit outside the jurisdiction or are insufficient.
- Decide with counsel whether to contest the need for security at all, or only the sum proposed — the two arguments are made separately, not together.
- File the response within the window set by the panel; a late response is often treated as consent to the figure proposed.
- If an order is made, arrange payment or a bank guarantee before the deadline — do not wait for a reminder from the other side.
- Keep a record of the payment or guarantee and confirm receipt in writing, since disputes about whether an order was met are common.
Who decides, and on what timing
The application is decided by the same panel or judge-rapporteur already handling the substantive dispute, not by a separate costs tribunal. Most applications are dealt with on the papers, without an oral hearing, unless either side asks for one and the panel agrees it is needed. In practice the decision takes weeks rather than days. The exact figure ordered is discretionary: the panel is not bound by the sum proposed and can set its own, higher or lower.
Three situations that change the answer
- If the claimant is a shell company with no trading history and no assets in the jurisdiction, the panel is more likely to order security, and at a higher figure, than against an established operating business.
- If the claim traces back to an acquired team's earlier work rather than to the current claimant's own development, ownership of the underlying right can be disputed alongside costs — see When an acquired team brings prior work in detail for how that separate question is decided.
- If the dispute sits next to a tokenised or digital-asset right rather than a conventional patent, the underlying ownership concept follows a different logic — see Token tokenised rights explained in detail before assuming the same costs mechanism applies unchanged.
What this page does not resolve
This page describes the sequence, the documents, and the actors. It does not set the figure a panel will order in a given case, and it does not cover national court practice outside the forum described here, which varies by jurisdiction and by the assets involved. Readers weighing exposure before signing a distribution agreement in a related commercial dispute may find Counterparty report before onboarding a distributor in practice useful as a separate, narrower check.
Verified
Verified as of 12 May 2025. This description follows published procedural guidance as applied by the forum handling patent disputes at this stage; it does not cite individual statutory provisions, consistent with a procedure-only format. Our Delivery statistics, published automatically overview in detail are updated independently of this material and are not a source for the steps described above.
Related reading
Stay pending validity step by step covers the parallel situation where the other side asks to pause the case on validity grounds rather than to secure costs.
FAQ
How long does costs and security for costs take in practice?
The application itself is usually decided within a few weeks once both sides have filed their submissions. The wider dispute pauses for that period, and for longer still if payment of an ordered sum is delayed once the order is made.
Which documents are needed to start?
The other side needs a costs estimate for the stages ahead, evidence of the claimant's financial standing or lack of assets in the jurisdiction, and a proposed figure. The claimant needs the same kind of costs estimate plus evidence to rebut the asset argument if it disputes the application.
What happens if the other side does not respond?
If the claimant does not respond within the window set by the panel, the figure proposed by the other side is typically treated as unopposed, and an order in that amount follows without further argument or a hearing.
If the opt-out window is closing on a patent family connected to this dispute, start with What to do first in this situation.