03/06/2024
One year ago (as of Saturday, 1st June) the Unified Patent Court (UPC) officially launched, and the European Patent Office (EPO) began processing requests for Unitary Patents. A new era of European Patents began. Understandably, given that the UPC Agreement was signed over a decade prior to the Court opening, there had been lots of speculation and discussion about the effect the UPC might have, what its character would be like, and, somewhat cynically, whether anyone would actually bother to use it.
Well, a year on, we have had our first glimpses at the answers to these, and other, questions. According to the official case load update from the UPC, in the first year of operation the Court received 373 cases at first instance. For comparison, the UK High Court received 46 new patent actions across 2023. Clearly, people are interested in using the UPC!
As for the character and effect of the Court, it is still too early to draw any firm conclusions; while we have had a lot of cases, we have had relatively few decisions, and of the decisions we have had some overturned on appeal. Nevertheless, looking back on the first year of the UPC reveals some interesting features and trends of the new Unitary Patent System that are beginning to emerge. Below, five members of the specialist UPC team at Reddie & Grose LLP have each picked out an aspect that has arisen in the previous year that they consider to be of particular interest – because they show insightful trends, answer important questions, or provide valuable insight into what yet remains unanswered.
Access to Documents
Under the UPC rules of procedure, a member of the public can submit a reasoned request to access UPC court documents. It is then up to the court to decide whether the request should be granted or refused by weighing up the balance between confidentiality for the parties involved and the public interest in having access to court documents. Public access to court documents is itself an emotive and at times controversial topic. This is in part due to the different traditions amongst the participating states and the EPO. By default, the EPO provides easy public access via the online EPO register to all documents that are submitted as part of proceedings. Parties can make redactions or request that a document is not published, but this is not the default. On the other hand, some jurisdictions take the view that commercial litigation should be private between the parties so do not allow public access to court documents, and some jurisdictions sit between these extremes, allowing access to documents on request from the public.
The approach that the UPC takes to access of court documents is of significant interest to practitioners as well as users of the system in general. Over the last year, we have seen the Courts of first instance issue decisions around this topic, and the Court of Appeal has recently clarified the approach that the UPC courts should take in the recent decision of Ocado v Autostore (UPC_CoA_404/2023, APL_584498/2023).
Zack Mummery, Partner, London
Languages at the UPC
While most UPC cases (about 2 out of 3) have been brought before German local divisions, English has overtaken German as the predominant language of the UPC. This is perhaps not surprising, given that the language of proceedings for most European patents (almost 4 out of 5) is English, and that English is available as a language of proceedings at all Divisions of the UPC.
Parties may apply for the language in which the patent was granted to be used as language of proceedings, and such a request may be granted against the will of one of the parties, as happened in Plant-e v Arkyne (see ORD_581189/2023), in which the President of the Court of First Instance granted a change in language of proceedings from Dutch to English, the language in which the patent was granted. The importance of the language of proceedings before the EPO, i.e. the language in which the patent was granted, was confirmed by the Court of Appeal in 10x Genomics v Curio Bioscience (see CoA_101/2024), in which the change of the language of proceedings to English, the language in which the patent was granted, requested by one party was granted. Generally, the approach taken by the UPC to languages so far appears very sensible and may contribute to the attractiveness of the UPC.
Dustin Bauer, Associate, London
Forum Shopping and File Wrapper Estoppel
Parties may have previously considered strategically bringing about an action before a particular division (forum shopping) based on the national law of where the division is based. After all, this seemingly makes sense since Article 24 of the UPC Agreement (UPCA) states that the UPC shall base its decisions, in part, on national law (among other sources, such as the European Patent Convention (EPC)). However, it can be seen in SES-imagotag SA v Hanshow Technology Co. Ltd that other factors may affect the ability of a party to effectively forum shop.
The Munich Local Division refused SES-imagotag SA’s application for a preliminary injunction and in doing so the division considered the prosecution history of the patent (EP 3,883,277) and the amendments made to the claims as originally filed. This may be surprising, considering that German courts do not usually accept prosecution history and file wrapper estoppel. But, it may be less surprising when we take a look at the panel of Judges. One of the Judges is a Dutch qualified judge and file wrapper estoppel is well established law in the Netherlands. This case acts as a good reminder that Patent Attorneys should be mindful of amendments and arguments made during prosecution, especially in view of global enforcement.
Joanne Pham, Associate, London
Security for Parties Outside the UPC
In the case UPC CFI NO. 514/2023, a US non-practicing entity filed an infringement action with the Munich Local Division of the UPC against various defendants based on the patent at issue: EP 1,875,683 B1.
Under the UPC, the Court may order the Plaintiff provide security for the Defendant’s legal costs. However, contrary to the national legal situation in many contracting states of the UPC, the UPCA has not explicitly codified any provisions that a security is necessary if a domicile or seat is missing within the area of the UPC or the EU.
In this case, the Court ruled that certain factors are to be taken into account, like the financial position of the other party in terms of a legitimate and real concern that a possible order for costs may not be recoverable and enforceable. The Munich Local Division decided that no indications were presented that any claim for reimbursement of costs would not be satisfied or that, despite sufficient financial resources, enforcement of a decision on costs would appear to be impossible or fraught with particular difficulties.
Based on this decision, for the Defendant it will be a difficult task to show an actual risk of a lack of enforceability in UPC infringement cases, since, in the non-practicing entity versus implementer scenario, the parties usually have no economic relationship prior to the infringement proceedings and non-practicing entities are generally not the subject of rating agencies. On the other hand, Plaintiffs from the US or Asia can expect that they will not have to provide security in infringement proceedings brought by them if they are not domiciled in Europe, at least if they are domiciled in a jurisdiction where a treaty exists to facilitate the recognition and enforcement of judgments. This requirement is met for the US and most Asian countries, but, interestingly, not at present for the UK.
Simon Lud, Partner, Munich
Oppositions and the UPC
European patents that have not been opted out of the Unified Patent Court system can be attacked in two separate forums, either by filing a revocation action at the central division of the UPC, or by filing an Opposition at the European Patent Office within nine months of the grant date. There is no estoppel between the two systems, so essentially the same arguments can be run in both forums. Alleged infringers in actions before the UPC have taken advantage of the ability to challenge patents in the two separate procedures, and nearly (but not quite) all of the patents granted since the UPC came into force that have been the subject of a UPC infringement action have seen a corresponding Opposition filed at the EPO. The EPO have also indicated that Oppositions will be the subject of an accelerated Opposition procedure, if the EPO are informed of parallel UPC proceedings either by the court or the parties to the proceedings. An inspection of the EPO Official register for the relevant patents shows that the first accelerated Oppositions are already underway, with decisions expected later in the year.
At the same time, the Central Division in Munich (Astellas v Healios KK in UPC_CFI_80/2023) has noted that an EPO Opposition hearing scheduled in three months time, with a decision expected some months thereafter, is not likely to qualify as the “rapid decision” mentioned in Article 33(10) UPCA and necessary when considering a party’s request for a stay of proceedings. Lastly, recently published data from the UPC shows that, in the first year of operation, only 40 or so separate revocation actions (in other words revocation actions not filed as a counter claim in infringement proceedings) have been filed at the UPC (compared with 134 infringement actions). Although we may see an increase in the number of separate revocation actions filed at the UPC in future, Opposition proceedings at the EPO clearly remain the preferred tool for challenging patents in Europe.
Nick Reeve, Partner, London
This article is for general information only. Its content is not a statement of the law on any subject and does not constitute advice. Please contact Reddie & Grose LLP for advice before taking any action in reliance on it.
