23 May 2014

Voting on The Unified Patent Court is problematic

The Unified Patent Court Irrespective of the result of the voting on Sunday, the users of the patent system will be forced to apply an enforcement system pushed through by politicians who have clearly not done their homework when it comes to complexity and the importance of the details.

The agreement concerning the Unified Patent Court concerns the establishment of a so-called "unitary patent" and a unified patent court.

In general, it is beyond question advantageous only to have to apply for a patent in one country, which patent will then be effective in a number of countries instead of having to apply in each country. However, such system already exists within the framework of the European Patent Convention.

As regards the new system, the consideration of patent applications will take place at the same institutions, and it does not seem that the material consideration will be essentially different from the existing system. What makes the new system different from the existing is the subsequent enforcement and hearing before a court of centrally issued patents.

In the existing system, such legal action must be heard in the country where the patent applies, which, of course, involves major costs.

In the new system, questions concerning validity and infringement of the unitary patent may be settled once and for all and be applicable to all countries covered by the unitary patent by a patent court established for the specific purpose.

In general, this is a major step forward.

But the problem is that many companies may be very uncertain as to the implementation of the new system. This is not least due to the fact that the procedural rules have not yet been laid down. The agreement on which we are voting is therefore being pushed forward without knowing the final content of the rules which may be of significant importance to companies. There are, in particular, two issues that are problematic according to the draft rules: First of all, the new system implies that, according to the Patent Court, the assessment of a patent's validity may be separated from the question as to whether the patent has been infringed.

This is problematic in terms of due process of law because a company claimed to be infringing runs a risk of having a restraining injunction issued against it which may later turn out to have been issued on a wrong basis because the patent is found to be invalid when the company - in one go - can be excluded from the European market as a whole; this, of course, causes great concern.

Secondly, all evidence must, in general, be available from the beginning. It is solely up to the court to decide to which extent production of evidence may be allowed later on. And it is - in terms of due process of law - very alarming that the plaintiff has all the time in the world to prepare the case, while the defendant only has very short time - three months - to prepare the case - perhaps in a foreign country and with effect on the company's entire European market.

It is worth noting that Danish companies choosing to operate in countries covered by the new system may be sued under the new rules, irrespective of whether Denmark implements the new rules.

Irrespective of the result of the voting on Sunday, the users of the patent system will be forced to apply an enforcement system pushed through by politicians who have clearly not done their homework when it comes to complexity and the importance of the details - thereby not having the necessary basis to consider all relevant interests.

It is, of course, problematic to ask the voters to decide on a system in which the most important procedures have not yet been decided upon, and it goes without saying that we, as ordinary voters, are uncertain about how to vote.

The above was published in Weekendavisen on Friday 23 May 2014.

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