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1 January 1970PatentsPaul England and Christopher Thornham

How to play by the UPC rules

Although procedural matters do not always attract headlines, the clear rules governing steps and requirements for progressing an action in the Unified Patent Court (UPC) are essential. The rules of procedure went through many consultation rounds and drafts. One should not be surprised. Practitioners attach great importance to them. National courts in Europe currently apply the same substantive patent law of infringement and validity, but differences in practice and procedure have a profound effect on where parties choose to sue and the outcomes they achieve.

In previous articles, we have addressed the types of actions that may be brought in the UPC (see  “The role of the UPC”). The procedural rules govern the conduct of three stages in an action to trial: (a) written procedure; (b) interim procedure; and (c) oral procedure, and the rules are structured around actions for infringement, revocation or non-infringement and the defences and counterclaims available, plus patent amendment.

When completed, these stages are intended to result in a written decision within approximately one year of the action being lodged. The rules of procedure govern the conduct of appeals of decisions on the merits, and certain interim decisions such as the grant of a preliminary injunction. Unless the court decides otherwise, an appeal against an infringement decision (including a preliminary injunction) will not suspend enforcement, but an appeal to an invalidity decision will suspend revocation. The rules also govern the conduct of the remedies phase in UPC actions.

Written procedure

The written procedure comprises the exchange of the parties’ statements of case: statement of claim, defence, counterclaim, reply and any further pleadings. These must provide a very detailed account of the case, as there is no later opportunity in proceedings to do so. UPC actions are therefore often described as front-loaded. For example, a claim of infringement must include instances of the alleged infringement, the evidence relied on (or an indication of evidence that will be provided) and all the relevant facts, law and argument about why these constitute an infringement.

A claim or counterclaim for revocation must, among other matters, include one or more grounds of invalidity. Any application to amend the patent in response to a revocation claim or counterclaim must contain the proposed patent amendments (including any auxiliary requests) and full reasons why the proposed amendments are permissible and the patent (as amended) is valid.

During the written procedure the defendant may lodge a preliminary objection to the statement of claim on the basis of the language used or the competence of the division in which the case has been lodged. Even without a preliminary objection, the parties may need to be heard shortly after the written stage proceedings about the transfer of an action from a local or regional division to the central division (under article 33[3] or [5] of the UPC Agreement).

Although revocation and infringement actions may be started in different divisions (central divisions for revocation; and local or regional divisions for infringement), the rules provide for the judge-rapporteur to transfer actions so that validity and infringement may be heard together or to ensure infringement is tried after validity if they are tried separately (see ” Revocation and bifurcation: what you should know about the UPC”).

Interim procedure

The action then progresses to the interim procedure, which the rules require to be completed within three months of closure of the written procedure. During this stage, the judge-rapporteur may require one or more interim conferences. The purpose is to prepare the case for the oral hearing, including identifying the issues and facts in dispute; establishing a schedule for progress of the proceedings; and issuing orders relating to specific documents or evidence.

The judge-rapporteur may also order that the evidence of certain witnesses and/or experts be heard separately in focused questioning in advance of the main oral hearing. This may happen if there is a risk that the one-day oral hearing would otherwise be overextended.

“The rules of procedure govern the conduct of appeals of decisions on the merits, and certain interim decisions such as the grant of a preliminary injunction.”

An application for the determination of damages must be lodged no later than one year from the decision on the merits, but it may be stayed if an appeal of the decision on the merits is pending. However, an interim award of damages may be ordered at the time of the decision to cover at least the expected costs of the damages proceedings.

Separately, the costs procedure is designed to allow a successful party to recover its reasonable and proportionate legal costs and expenses from the unsuccessful party, but whether this will be determined issue-by-issue remains to be seen in the cases. Orders for interim costs and security for costs may also be obtained.

Preliminary injunctions

Aside from its power to make decisions on patent infringement and validity, the UPC will be important as a forum for obtaining preliminary injunctions (PIs) and evidence preservation orders. PIs and preservation orders may be pursued before actions on the merits have been lodged (but if an action on the merits is not brought within 31 calendar days or 20 working days of the order, it will be revoked) and, in some circumstances, without notice to the defendant.

Potential defendants can file protective letters to try to pre-empt and defeat any application for a PI or preservation order. The award of a PI is discretionary and the court must take into account the relative potential harm to the parties when deciding whether to grant it (see  ”Striking early: preliminary injunctions in the UPC”).

If it chooses to, the court may also examine evidence of the validity and infringement of the patent before granting a PI. Unreasonable delay in applying for a PI must also be considered. If a PI is awarded, the court may require a security to be provided by the applicant in order to compensate the defendant in the event that the injunction is later found unjustified. It remains to be seen just how quickly it will be possible to obtain a PI in the UPC, although in cases of “extreme urgency” the rules state that these can be decided immediately.

Preservation orders allow a party to obtain a detailed description of allegedly infringing products or processes, with or without taking samples; physical seizure of allegedly infringing products; physical seizure of materials and implements used in the production and/or distribution of the goods and related documents; or preservation and disclosure of related digital media and data.

Alternatively, an order to inspect premises, products and/or methods in situ may be obtained (an inspection order). PIs and preservation orders can have a huge impact on parties, so it will be important for the UPC to exercise its discretion predictably.

Evidence and experiments

Aside from preliminary measures, there are other ways to obtain evidence in the UPC during the main proceedings. In particular, parties are required to indicate and produce evidence “regarding” a statement of fact that is contested or likely to be contested. It is unclear whether this requirement includes evidence that is both helpful and unhelpful to the party relying on the statement of fact, and how wide-ranging it will be.

Orders to produce evidence from an opponent—specified documents and/or information for which the applicant has “reasonably available and plausible” evidence of existence—may also be obtained. Orders to communicate information, in particular, information about the origin and distribution channels of infringing goods, are also available against an opponent and, in certain circumstances, a third party.

Expert evidence, witness evidence, documents and exhibits are also permitted forms of evidence in the UPC. Expert evidence may be given by a court-appointed and/or a party-appointed expert, although it remains to be seen whether different UPC divisions will have different preferences. Experts must be objective and have a duty to assist the court impartially.

This is particularly important for party-appointed experts, where this duty overrides any duty to the appointing (and paying) party. A further means of adducing evidence is experiments, either by the parties or by a joint expert. However, any previous attempts to carry out a similar experiment must also be disclosed, and the court may require the experiment to be repeated in the presence of the parties and their experts—safeguards similar to those in UK proceedings.

With the rules now finalised, the basic elements for the conduct of an action in the UPC are in place. What remains is for them to be applied in practice by the court.

Paul England is a senior associate at  Taylor & Wessing. He can be contacted at: p.england@taylorwessing.com

Christopher Thornham is a partner at Taylor & Wessing. He can be contacted at: c.thornham@taylorwessing.com

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