Shakespeare's plays are known for their swordfighting, or, as it's known in theatre lingo, "stage fencing." It seems like you can't swing a rapier in a Shakespeare play without, well, running someone through with it.
And Shakespeare in Love shows us that the sword fights didn't just happen on stage. They happen off-stage, too. And sometimes they happen on a stage but there isn't a play happening. But this isn't just happening because Tom Stoppard decided that swordplay was funplay. He also wanted to make a commentary on the nature of the theater.
Shakespeare in Love is a meta movie, and it wouldn't be Shakespeare without a duel or two, However, because this is a comedy, no one has to die and yell "I am slain!" In this film, the swordfights are mostly used for a bit of action and occasional comic effect. This is, essentially, Tom Stoppard winking at the audience and letting them know that Shakespeare was full of it—he didn't have any personal interaction with tragic heroes and dramatic deaths. He just made that stuff up.