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1 May 2014PatentsAndreas Zachcial and Philipp Lilie

United Patent Court: a grand unified theory

Early last year, the patent world sat up and took notice when the Unitary Patent regulations formally came into force. The intention was to create a patent that would guarantee supra-national protection for an invention in 25 countries across Europe. However, at the moment, applicants are still waiting in vain for the chance to obtain such a Unitary Patent.

The reason for this lack of availability is that the regulations on the Unitary Patent will not apply until the Unified Patent Court (UPC) has become operational. That court is essential for the unification of the European patent system and, as part of the judicial system of each of the 25 member states, it will become an institution unique to the field of patents.

"When it comes to operating and shaping the court and its reputation, the judges of the new court will have the most impact on the hoped-for success."

Officially, the target date for the UPC to be brought to life is the first half of 2015. For applicants around the world, time is therefore running short to assess the risks and opportunities of this new institution. Even doing nothing does not mean that everything stays as it is. In principle, the UPC will gain exclusive competence in respect of matters relating to European patents, including actions for actual or threatened infringements and related defences, actions for declaration of non-infringement, actions for provisional and protective measures and injunctions, actions for revocation and counterclaims for revocation.

In the UPC there will be a Court of First Instance and a Court of Appeal. The Court of First Instance will have a central division in Paris, with sections in London and Munich, as well as local divisions which every contracting member state may establish. The Court of Appeal will have its seat in Luxembourg. It is to be welcomed that a patent mediation and arbitration centre, with seats in Ljubljana and Lisbon, will also be established.

In view of the fact that until now in Europe procedural practice in different member states has been diverse when it comes to infringement and invalidation proceedings, this centralised approach carries risks as well as assurances. All decisions before the UPC will be based on identical sources of law, regardless of the country of the applicant or the alleged infringer.

A new agreement

As well as the laws of the EU and the European Patent Convention, the most relevant source of law will be the entirely new UPC Agreement. This agreement codifies institutional provisions, as well as substantive law on patent infringement and procedural provisions. The concept of having a new and reduced set of rules and provisions for multiple countries is causing some worry, as it will result in a situation where a new court, with new judges of diverse nationalities, will dispense justice on the basis of completely new laws. That means there is no orientation towards established case law. It will be interesting to see if this is a strength or a weakness of the new system.

When it comes to operating and shaping the court and its reputation, the judges of the new court will have the most impact on the hoped-for success. There will be both legally-qualified and technically-qualified judges, all being nationals of a contracting member state and having experience in the field of patent litigation. The panels of the UPC will have a multinational composition.

The training centre for the judges of the UPC opened in Budapest only in March 2014, but it is hoped that this will prepare the selected highly-qualified individuals from all the contracting states for the major challenge of moulding a competent and respected court.

Considering the complexity of the matters brought before the court and in view of the challenges concerning the development of the procedures outlined above, the architects of the new system have provided for an orientation phase for applicants, patent owners and representatives.

Opting out

There will be a transitional period during which some of the functions of the new system can be bypassed for some patents. The first transitional period is seven years, with an option to extend this for up to a further seven years if it transpires that this is necessary.

During that period, actions for infringement or for revocation may still be brought before national courts, and patent owners or applicants for European patents may opt out of their patent/application in order to keep it in the established system; it will always be possible to opt in again. Importantly, this opt-out is only possible for traditional European patents with validity in a selection of countries; there will be no possibility to opt out of a European patent with unitary effect.

Any proprietor of European patents and any prospective applicant, as well as any counsel for such applicants, should carefully consider the opt-out option from the very start of the new system. Otherwise, as soon as the new system is in place, any party may bring an action related to that patent before the UPC, forcing the owner or applicant into the new system.

Since all European patents with unitary effect are bound to the new court system for better or for worse, the choice of unitary effect should also be considered thoroughly. Until the new system has been established, it may be a good approach to continue with the tried and tested validation. Patents validated the proven way are compatible with the old and the new court systems, whereas Unitary Patents will be tied to the new system.

Some additional thought should be spent on the language of the patents. As a rule, for court proceedings in the Court of First Instance, the official language of the local division will apply, while in the central division it will be the language of the patent. The language of the proceedings will be kept at the Court of Appeal. There is still an option to agree to use the language of the patent for the proceedings. The language of the patent becomes even more important that way because it defines a potential language option for any proceedings in Europe.

Andreas Zachcial is a European and German patent and trademark attorney at Zenz. He can be contacted at: zachcial@zenz-ip.de

Philipp Lilie is a European and German patent and trademark attorney at Zenz. He can be contacted at: lilie@zenz-ip.de

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