UPC scenarios: optimists look to summer 2022
On December 18, 2020, the German Federal Council (Bundesrat) unanimously approved the ratification of the Unified Patent Court (UPC) Agreement (UPCA), which concluded the parliamentary ratification process for the second time.
Shortly afterwards, two complaints were filed in the Federal Constitutional Court (Bundesverfassungsgericht), one by Düsseldorf lawyer Ingve Björn Stjerna and one by Munich-based non-profit Foundation for a Free Information Infrastructure (FFII). Stjerna had filed the complaint against the first attempt to ratify the UPCA in 2017, which led to a judgment on February 13, 2020. The court held that the necessary quorum was not present in parliament when the law was approved. That error has now been repaired.
The UPC experienced another setback on July 20, 2020 when the UK government formally announced its withdrawal from the UPCA. Until then the UK’s position had been that it would participate despite leaving the EU, but this changed. As a consequence, the UPC jurisdiction will no longer cover the UK and London can no longer be one of the seats of the UPC’s Central Division.
Although this was a disappointment for industry, it did not materially change their support for the UPC. Some have argued that life science cases cannot be brought before another seat of the Central Division, as article 7 of the UPCA provides that one of the seats of the Central Division shall be in London, whereas annex II provides that at this seat the cases in categories A and C of the World Intellectual Property Organization International Patent Classification will be handled, which basically are the chemical and life sciences cases.
If this poses a problem, it will come up only when the first life science case in the Central Division is handled in another location, so it doesn’t need to affect the inauguration of the UPC as such.
The UPCA was signed on February 19, 2013, and the preparatory committee has been working on setting up the court ever since. The German ratification is the last one required for the UPCA to enter into force.
What next?
The big question now of course is: what will happen next? Will the UPC ever open for business and when will that be? In order to assess the possible scenarios, it is important to have a closer look at the issues before the Bundesverfassungsgericht.
So far nobody knows the exact content of the new complaints. However, Stjerna is an intelligent man. His 2017 complaint was 160 pages long. It seems unlikely that he overlooked possible arguments in drafting it. There have not been any relevant new facts since that complaint was filed. The UK withdrawal from the UPCA has no effect on whether the UPCA is in line with the German constitution. This makes it likely that the new complaint contains the same arguments, except the one on the quorum in the Bundestag, as that has now been resolved.
The complaints of the FFII are also unknown. In general, the FFII is against software patents, but it is hard to see how that relates to the German constitution. On the FFII website they complain that the UPCA doesn’t allow the Court of Justice of the EU (CJEU) to have a say in patent law. That is not completely true, since the UPCA will apply EU law in as far as it relates to patents and will refer questions on EU law to the CJEU, but in addition it is hard to see why this would be a violation of the German constitution.
