UPC and Patent Trolls…

Written by Louise AMAR 21 February 2014

Marc Tarabella, a European MEP (Group of the Progressive Alliance of Socialists and Democrats in the European Parliament) from Belgium asked in November 2013 the European Commission the following written question about Patent Trolls and the UPC:

Are ‘patent trolls’ soon to arrive in Europe en masse? These companies, which are very active in the United States, make money by buying up patents with the sole aim of taking anyone who infringes them to court. ‘Patent trolls’ thus make no commercial use of the patents they own; rather, they use them purely as a way of pressuring other companies into giving them money.

For now, ‘patent trolls’ are largely an American problem. However, the new EU legislation on patents could change that.

1. How is the Commission preparing for this legislation?

2. Does it have concerns that the law will be abused?

Intellectual property cases may be dealt with by two courts: one focuses on the validity of the patent, while the other establishes whether the patent has been infringed or not. As both courts work independently of each other, a product may be preventively taken off the market before the issue of the patent’s validity has been resolved. What is more, this could happen in at least 13 Member States, once the single patent becomes a reality.

3. In view of the major impact such a ban would have, would this not enable plaintiffs to extract considerable sums of money on the basis of poor-quality or even invalid patents?”

 

Michel Barnier, on behalf of the European Commission responded in January 2014 that:

“The Commission fails to see how the recent Union legislation on patents, namely Regulations 1257/2012 and 1260/2012, could increase the activity of so called ‘patent trolls’ in Europe. To the extent that the Honourable Member’s question pertains to the Unified Patent Court (UPC), it should be noted that the UPC agreement is an instrument under international law and is not part of Union law. The matter is thus outside the Commission’s remit. The Commission will, however, provide the following factual information.

The UPC as a common specialized patent court will increase legal certainty, and a centralized patent revocation procedure will leave less room for ‘patent trolls’ to exploit current fragmentation.

The UPC Agreement provides for safeguards against ‘patent trolls’. No automatic injunctions shall be granted: the UPC has the discretion to weigh the parties’ interests and to take into account the potential harm from the grant/refusal of the injunction. The Rules of Procedure (draft of 25 June 2013) foresee a possibility to require reasonable evidence that the patent is valid and being infringed and to order an adequate security for any injury likely to be caused to the alleged infringer if the injunction is later revoked.

The UPC is a single court competent for both patent infringement and revocation actions. A local/regional division has only a possibility, after having heard the parties, to refer a counterclaim for revocation to the central division. The Rules of Procedure provide that in case of a high probability that the patent will be held invalid in the revocation procedure the court must stay the infringement proceedings. The objective is to ensure that the patent validity is dealt with before the infringement action can proceed.”

 

This written question comes after the open letter signed by a number of very important groups such as Google, Apple, Cisco, Microsoft or Intel in September 2013 who raised concerns about the danger of Patent Trolls for the UPC, and especially in relation with injunctions. The UPC injunction power will in fact extend beyond a single country to most of Europe, which could lead to a rise of abusive litigation before the UPC. The open letter argued that “a rule that does not offer sufficient guidelines on when to grant injunctions will create strong incentives for abusive behaviors and harm the innovation that the patent system is designed to promote”, it also highlighted the fact that to mitigate the potential for abuses of Patent Assertion Entities, the UPC should be guided by strong rules of procedure assessing proportionality prior to granting injunctions.

 

The 15th draft of the rules of procedure so far deal with injunctions in rule 211 which sets out the criteria for the granting of preliminary injunctions. It states that “(1) The Court may in particular order the following provisional measures: (a) injunctions against a defendant (…) (2) In taking its decision the Court may require the applicants to provide reasonable evidence to satisfy the Court that (…) the patent is valid and his right are being infringed. (3) (…) the Court shall have discretion to weigh up the interests of the parties”. What causes concerns is of course the word “may” which indicates that it would be at the discretion of the UPC and its judges to apply the proportionality safety nets set out in rule 211. The definitive draft of the rules of procedure has not been yet released but it can only be hoped that safeguards against patent trolls will be secured.

 

The UPC Blog awaits your comments and thoughts on this issue:

Do you think that the UPC might be targeted by Patent Trolls?

Do you think that the draft rules of the UPC are too weak to prevent abusive litigation?

Or on the contrary, do you think as Michel Barnier, that the existing safeguards are enough?

Do you think that the answer to that problem might ultimately lie in the hands of the newly trained UPC judges?

 

 

 

 

 


Tags:

Discussion

Draft Rules of Procedure

UPC

UPC Agreement


Similar posts

Comments are closed.

    There are no comments

Advocate General

AIPPI

Alignment

Article 83

Belgium

Bifurcation

Brexit

Brussels I Regulation

Chronology

Committee

Consultation

Court Fees

Damages

Discussion

Draft Rules of Procedure

e-Filing prototype

Entry into Force

EPO

EU Legislation

EU Regulation 1257/2012

EU Regulation 1260/2012

European Commission

European Parliament

european patent

European Patent Convention

Event

Evidence

Germany

Infringement

Interim Measures

Italy

Key dates

Legal certainty

Legal framework

Licensees

London

Malta Problem

Mediation

Mock Trial

Opt-out

Oral Procedure

Order for inspection

Order to preserve evidence

Patent Attorneys

Patent Cooperation Treaty

patent regime

Patent Trolls

Portugal

Preparatory Committee

Protective Measures

Protocol to the Agreement on a Unified Patent Court

Provisional Application phase

Provisional Measure

Public Consultation

Recoverable Costs

Renewal Fees

Representation

SME

Spain v Council of the EU

Start of Proceedings

Summaries and Guides

Summary

Supplementary Protection Certificate

survey

Training

Transitional period

Translation

UK

UK rat

unitary effect

Unitary Patent

Unitary Patent Protection

United Kingdom

UP overview

UPC

UPC Agreement

UPC Appeals

UPC Austria

UPC Candidate Judges

UPC Case Management System

UPC Code of Conduct

UPC Competence

UPC Conference and Workshops

UPC Denmark

UPC Divisions

UPC Draft Rules Procedure

UPC France

UPC Languages

UPC News

UPC operational

UPC overview

UPC Preparatory Committee

UPC Procedure

UPC Ratification

UPC Sources

UPC Sources of Law

UPC structure

UPC Timetable

Videos

Webinar

LinkedIn Auto Publish Powered By : XYZScripts.com