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Swift procedure Unified Patent Court may put a lot of pressure on defendants

Prompted by the upcoming Unitary Patent (UP) and Unified Patent Court (UPC), a group of European patent attorneys decided in 2013 to create the European Patent Litigators Association (EPLIT), ‘promoting fair patent litigation in Europe’. Publisher Kluwer IP Law spoke to its president, Koen Bijvank. ‘It is unpredictable how the market for patent litigation will change with the advent of the UPC.’ Koen Bijvank is also one of the speakers at Unitary Patent Package.

Why was EPLIT created?

Koen-Bijvank 150x150‘EPLIT wishes to contribute to making the UPC a success. This is important for our members’ clients and for the future of our profession. European Patent Attorneys (EPAs) who want to litigate before the UPC need an additional qualification, The European Patent Litigation Certificate (EPLC). As not all EPAs will become active before the UPC, it means a new profession will effectively be created. EPLIT wishes to be a platform for EPAs having a litigator certificate. Other patent attorneys, as well as lawyers (solicitors, attorneys-at-law) are welcome to join as associate members. Currently we have about 170 members, including voting and associate members.’

According to the website, EPLIT wants to promote user-friendly, fair, efficient and cost-effective patent litigation. What has EPLIT’s role been so far in achieving this?

‘EPLIT has made contributions to the various public consultations organized by the UPC Preparatory Committee. Also, two of EPLIT’s board members are member of the Expert Panel of the Preparatory Committee.’

Do you feel the UPC will be user-friendly, fair, efficient and cost-effective?

‘The system will be based on a fully electronic docketing system. This is currently being tested. Early impressions are promising and indicate that the system will be easily accessible and thus user-friendly.

Whether the UPC will be fair will depend to a large extent on the quality of the judges. It appears that many of Europe’s most experienced patent judges will apply for a position as UPC judge. If these judges are able to find common ground on their approach to substantive patent law, the system should at least be as fair as patent litigation in Europe is nowadays. In my view the signs are very good for the UPC system in this respect.

As to efficiency, the draft Rules of Procedure contain many quite strict deadlines to ensure a swift procedure. On the one hand that is good, because parties will have certainty in a reasonable timeframe. On the other hand, it may put a lot of pressure on the parties, particularly on defendants who did not expect to be faced with the assertion of a patent before the UPC. They will have little time to prepare their defense and possible counterclaim.

EPLIT is happy to see that depending on the commercial interest of the case, the court fees will be adjusted. The system should not be so expensive that SMEs are effectively barred from enforcing their patents or defending against patents of others before the UPC.’

EPLIT promotes ‘any measures for improving patent litigation’. Could you explain?

‘We wish to remain engaged with the UPC, also when the system becomes operational. Apart from that, we hope to promote a debate among practitioners, commenting on the development of case law and contributing to the training and education of practitioners.’

Will EPLIT have to bridge gaps between the different national practices in Europe?

‘EPLIT’s membership comes from all UPC member states. While members are competitors in one sense, they face the same challenges in becoming acquainted with a completely new court system. An exchange of information and experiences will help EPLIT members to be more effective as practitioners before the UPC and this, in turn, will help to jumpstart the system. An example of EPLIT’s efforts is the mock trial that will take place in Munich on 22 January 2016 under the UPC Rules of Procedure. In addition, EPLIT organizes an annual meeting, this year on 11 April 2016 in Amsterdam.’

It seems practitioners from ‘strong’ IP countries, such as Germany, the UK and the Netherlands, will be in a position to extend their practices, to the disadvantage of practitioners in ‘peripheral’ jurisdictions. Is this correct?

‘It is unpredictable how the market for patent litigation will change. There will be fewer cases where the same patent is litigated in parallel in different jurisdictions. After the transition period this will disappear altogether. Nonetheless, there may be an increase in the number of patents that are enforced because UPC litigation may be more attractive than national litigation in that it covers a much wider territory and market for costs which are likely to be lower than litigation as it is currently run in some member states, e.g. the UK or Ireland.

Experienced practitioners may have an advantage in gaining a market share in the new system. However, I know several very good EPAs and lawyers from countries which are not the more traditional jurisdictions for patent litigation in Europe and I am confident that those will also do well in the new system.’

It has often been argued that the UPC system is important for and should be accessible for SMEs. In the meantime however, it seems that for instance the pharmaceutical and IT sector and big international businesses in general are the ones that will profit most. How do you see this?

‘I mostly agree with this view. An SME who is only commercially active in one member state may be sued before a local division of the UPC where he will be confronted with litigation that may be more expensive than national litigation in his country. Moreover, if he wishes to start a revocation action, he will have to do so before the central division, i.e. in a language that may not be his own in a court outside of his home country.’

What does the UPC mean for you personally: a burden or an interesting challenge?

‘For me it means learning a completely new legal system, which I would very much like to be active in. It opens the door to new possibilities in the form of direct representation before the UPC by EPAs, although it is my expectation that patent litigation will remain teamwork where lawyers and patent attorneys work together. The international dimension, where any lawyer or patent attorney can act before a division of the UPC anywhere in the member states, makes it all the more exciting.’

Written by: Kluwer UPC News blogger
Source: ‘Swift procedure Unified Patent Court may put a lot of pressure on defendants’

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Wouter Pors about the new rules of Litigation Certificate

We have interviewed Wouter Pors, Partner of Bird & Bird, before the upcoming event Unitary Patent Package. Wouter tells us everything about the new draft Rules for the European Patent Litigation Certificate. What are the concrete changes? And what does this mean for Lawyers and European Patent Attorneys?

New rules of Litigation Certificate: What are the concrete changes?

Wouter-Pors2Knowledge of tort law has been added, as well as knowledge of patent enforcement, as for instance provided by the Enforcement Directive. The addition of tort law is interesting, as the UPC Agreement does not give the UPC jurisdiction for claims based on tort. However, a defence in a patent case may of course be based on the concept of tort.

E-learning tools are now more clearly encouraged, but there should also be practical training requiring personal participation. I think it is assumed that lawyers will always have had such practical training in the initial years of their career, but many patent attorneys may have little experience in litigation.

In future, the certificate can only be obtained through an education at an institute which is accredited with the UPC. For a transitional period of just 1 year from entry into force of the UPC Agreement, it can also be obtained on the basis of having completed one of the “grandfathering” courses mentioned in the Rules. This used to be 3 years. This should not be too much of a problem, provided that a sufficient number of educational programs is accredited by 2017, the proposed start of the court.

The criteria for experience as qualification during the transitional period have been raised. This used to be having represented a party in 2 infringement cases in 4 years and now is having represented a party in 3 infringement cases in 5 years without the participation of a lawyer, or having acted as a judge in 3 cases. I would be surprised if more than very few patent attorneys would meet this requirement.

The rules on accreditation of educational institutions have now become more detailed, as have some other rules. Those are not material changes and do not affect the position of patent attorneys.

Basically, the changes are gradual, not fundamental.

What does this mean for Lawyers and European Patent Attorneys in your opinion?

There are no barriers for any lawyer to act as a UPC representative, whereas the requirements for patent attorneys have been raised slightly. It now seems highly unlikely that a patent attorney would qualify as a representative purely on the basis of experience. Basically only education will provide patent attorneys with the right to represent parties before the UPC without the involvement of a lawyer.

Are the qualifications of lawyers strict enough? Are the minimum requirements enough?

Neither. I understand that it is politically difficult to impose requirements on lawyers and to impose more requirements on patent attorneys, but the logic behind that is lacking. Patent litigation can be legally very complicated, involving many aspects of private international law, competition law and other difficult issues. The CJEU case of Huawei vs ZTE involved complicated questions of competition law and abuse of right. The CJEU judgement in the Spanish appeal against the Unitary Patent Regulation has raised the issue whether Article 7 UPR only determines the law that governs ownership of a Unitary Patent or also the law applicable to licence agreements and whether that can be modified by a choice of law in a licence agreement. Even the experts do not agree on that, but any UPC representative should be able to plead such an issue. So, in my view the bar should be raised further.

That of course certainly applies to lawyers. Patent litigation can only be done properly by true specialists with thorough knowledge of many aspects of the law, but any lawyer can now act as a representative before the UPC. The same of course already happens in the national courts, where you can regularly see a case fail because of bad representation. The Dutch Bar Association has recently given lawyers the option to indicate their specialisation in its online database, but there is no check on actual quality, unless there is an accredited specialisation association.

This has led Willem Hoyng, Dirk Visser and myself to take the initiative to set up such an association for The Netherlands, together with Carreen Shannon and Thera Adam. This association, the Vereniging Intellectuele Eigendom Proces Advocaten (Association Intellectual Property Litigation Lawyers, VIEPA), will have exams for lawyers who want to register as an IP litigation specialist, as well as strict requirements for maintaining their experience. There will be a sub-category for patent litigators, who are required to be an EPLAW member as well (which in turn requires experience in handling patent litigation). This is intended to guarantee a minimum level of quality in handling IP litigation, which can be checked at a glance in the Bar Association database. Lawyers have proven to be able to actively and efficiently self-regulate; the disciplinary systems for lawyers in most countries are based on this. I think our example of introducing a special IP qualification could be followed by lawyers in other countries.

How can an in-house patent attorney select the proper representative? Under what conditions can / should an in-house patent attorney hire a lawyer and when a European Patent attorney?

The answer varies depending on the size and experience of the company. Some companies have a lot of experience in patent litigation, because it is vital for the value of the company or because they operate in a highly litigious sector. These companies have highly specialized in-house lawyers doing strategic coordination of patent litigation. Richard Vary at Nokia has as much knowledge as any patent litigator. In-house patent attorneys may also be very experienced in handling the company’s legal IP strategy. Frank Landolt at Ablynx is very sophisticated. Those companies have no difficulty in selecting their litigators; they can assess the quality of their representatives without any problem. I also know a cloud technology start-up company where the management, which does not include a lawyer, is perfectly capable to do a very strict assessment of their legal representatives.

However, for less experienced companies and sme’s in general it is quite difficult to make a proper selection. Such companies need to be able to rely at least partly on a guaranteed badge of quality. For patent attorneys, this starts with the qualification as European Patent Attorney and the Litigation Certificate. For lawyers, it should start with a specialisation association that applies strict requirements. Next you can of course look at internationally recognised rankings, such as Chambers and Legal 500. In some countries you can also check the litigation track record online, like in The Netherlands or the UK, where all judgements in patent cases are published. That will also be the case at the UPC. Finally, you can ask a selection of firms to pitch for the work.

However, I hope not to be sounding too presumptuous, but it is hard for me to imagine a case that can be safely handled by a patent attorney without an experienced lawyer, just like it is hard to imagine a patent case to be handled by a lawyer without deep understanding of the technology at hand. Even if you are planning “just” to start a revocation action at the UPC (which in the German Bundespatentgericht and in EPO oppositions is done by patent attorneys), you cannot control the arguments and counterclaims the defendant may come up with. Therefore, I expect that the future will teach that lawyers will always be needed in UPC litigation, but they should be good lawyers and know their limitations in handling technology.

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Francesco Macchetta about Italy becoming the 26th UPP Member State

Prior to the Unitary Patent Package Conference we have interviewed Francesco Macchetta, Director Intellectual Property, Bracco Group . What is Francesco’s opinion about Italy recently becoming the 26th UPP Member State? And what are the consequences for the Italian companies?

Francesco Machetta2What is your opinion of Italy recently becoming the 26th UPP Member State?

I am very happy. I think it is a very significant contribution to the building of the new European system allowing Italy to fully take part in its effective shaping and take off phase. I would like to note the very short time between when our Government announced for the first time its intentions at the Competitiveness Council of end of May and its filing of the relative declaration (at the beginning of July). I hope, and I am confident, that we will witness a similar steady pace shortly with the Parlamentary approval of the law enabling the ratification of UPC.

What do you think of UPP & UPC entering into force next year?

Well. I look forward to it and hope that we can all witness it happening in 2016. I believe the new system represents an epochal change in the way patents are dealt with in Europe. Having just one forum to litigate patents in Europe can only be beneficial to technology innovation and its being implemented in wider markets, hopefully to the benefit of the buyer/users of the new technologies.

If we keep up with the promises of high quality judgment in a reasonable short time and overall cost effective, I am confident we’ll see UPC becoming a meaningful patent litigation forum worldwide.

What would be your frank and concise answer to the fatidic question: cui prodest?

I believe any business and institution dealing with technology innovation and implementing an adequate patent protection strategy for it will benefit from the new system. European enterprises can get the most of it if they accept the challenges of technology innovation and with no exception consider the EU market, instead of any national portion of it, as their “home” market.

What are the consequences for the Italian companies, from start-ups to multinationals?

I believe that with Italy being part of the new system in full from the beginning, it has a significant impact on its success and rapid pick up phase. Currently an EP patent once granted is validated in Italy in about 50% of the cases. It is in the fourth place among EPC contracting States. So there will be advantages for all patent-oriented innovative companies, independently of their seat or principal place of business. For the Italian ones, there is the immediate “relief” of not having to follow two parallel routes, one for Italy and another one for the rest of EU, but I expect the main advantage to be a revamped awareness of the strategic value of IPRs (and patents in this case) and a better and more effective use of it.

What are the consequences on UPP renewal fees?

Hopefully none! As we know there is an agreement in principle already in place (the so-called “true top 4” scenario)  and I do not expect it to be re-discussed or revisited now. The agreement in principle tried to strike a balance between guaranteeing the long term sustainability of EPO functioning and attractiveness to applicants. I think the balance has been reached with the “true top 4” scenario and there is no need to revisit it now. The addition of Italy, as I said, should enhance acceptance of the new system in particular at the beginning, thus broadening the number of those choosing UPPat its start. The result of it is that more money that initially expected should be collected at the beginning.  This double effect, i.e. more attractiveness to potential users and consequent higher income from renewal fees, as one can see, still balances attractiveness for patent applicants with long term sustainability of the EPO, in my view.

What is the opinion in Italy on the projected UPP renewal fees ?

It is hard to generalize, but in innovation (and patent)-oriented industry I believe that there is agreement  on the fact that, now that Italy is in the system  and we do not have to pay an extra fee to protect ourselves here, on  “true top4” is overall acceptable. Many believe however that “true top4” is already at the extreme of the generally acceptable end of the spectrum.

 

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Kevin Mooney about the last steps before the start of the UP and the UPC

Prior to the Unitary Patent Package Conference we’ve interviewed Kevin Mooney, Chairman of the Drafting Committee for the Rules of Procedure for the Unified Patent Court and Partner at Simmons & Simmons LLP. What are the last steps to be taken for the start of the UP and the UPC in 2016? And when do you expect the UP and UPC will start and when will the sunrise period begin for the opt-outs?

Kevin Mooney 200x200What are (in your opinion) the last steps to be taken for the start of the UP and the UPC in 2016?

On October 1st the Member States will sign a Protocol on Transitional Application. This will allow the Preparatory Committee to take all the practical steps necessary for the UPC Agreement to come into operation in an efficient manner.This transitional period will probably last until July 2016.This will include the hiring and training of essential staff and the location of premises.

The actual start date for the UPC and UP will depend on the progress made during the transitional period.The most optimistic date remains 1st October 2016.

What is the status of the Rules of Procedure and when do you expect the final version? (18th Draft and your expectations)

18th draft of the Rules of Procedure will be adopted by the Preparatory Committee on 19th October. Thereafter there will be minor amendments only, for example to incorporate the results of the Court fees consultation.

When will the final consultation of the renewal fees and court fees take place and what do you expect the outcome will be?

Results of the consultation on Court fees are currently being analysed. There will be further negotiations among the Member States until December when a final proposal will be put to the Preparatory Committee for agreement in February 2016.

What is the status of appointment of the UPC Judges and how will they be trained?

The appointment of judges has been delayed.It is now expected that an advertisement will be issued in December to be followed by appointments in the New Year.

Will there be a Sunrise register for the opt in or opt-out and when will that start?

There will be a sunrise period for opt-outs but the process will now be organized by the Preparatory Committee during the transitional period and using the Court’s IT system. It is not clear when the Sunrise register will start, certainly not in October, but probably Spring/Summer 2016.

What are the consequences for the UP and UPC for the UK if they might leave the EU in 2017 (Referendum to be held in 2017)?

If the UK referendum result is to leave the EU the UK will cease to be a member of the UPC project.