European Patent Litigation

1. European Patent Litigation Timothy J. Powell Member of the International Liaison Committee IN ASSOCIATION WITH

2. Overview • Country summaries: • Germany • France • Netherlands • UK • UP & UPC • Will they go ahead? • What are important impacts on European patent lirtigation?

3. Overview: Germany • Key feature is bifurcation of infringement and validity actions • Infringement in any State court • If infringement occurring in the state • Validity only in Nullity Court in Munich • Timetable often quicker in infringement court than nullity court • So can be good for patentees • Can enforce infringement judgement before validity judgement handed down

4. Overview: Germany • Bifurcation example: Patent infringement • Defendant sued in Düsseldorf September 2015 • Infringement hearing & opinion 27 September 2016 • Infringement judgement by end-October 2016 • Parallel nullity hearing not until January 2018 • No cross-examination, disclosure/discovery • So cases on average cheaper than in e.g. UK • But appeals more common • Costs recovery partly related to “value” of patent • Calculation transparent unless appealed

5. Overview: France • Distinctive feature is SasieContrefaçon: court order permitting (controlled) acquisition of evidence from infringer • Very useful as evidence can be used in other jurisdictions • No bifurcation so infringement & validity heard together

6. Overview: France • No cross-examination, discovery • Incurred costs between German & UK levels in recent cases? • Costs recovery: losing party pays • But court can curtail costs recovery; relatively complicated formula • Recovered costs rarely approach level of incurred costs • Recent judgements in region of €50000 - €100000

7. Overview: Netherlands • Infringement & validity heard together • Dutch courts invented cross-border injunction • Courts continue to grant such injunctions sometimes • Judgements available in 16 – 20 months unless Kort Geding or other shortened procedure invoked • Procedure “front loaded” – limited scope for amending case as it proceeds

8. Overview: Netherlands • Costs recovery “full” • But costs generally determined in early stages of case • Detailed costs schedules required • Costs recovery in Netherlands now at much higher levels than previously • Used to be essentially nominal costs • Significant development? • Does high costs recovery rate discourage lawyer expenditure?

9. Overview: UK • Infringement & validity heard together • Centuries of common law practice • Disclosure, experiments, cross-examination extensive • So justice thorough • Privilege a long-established feature of litigation • Compare with limited exposure in Continental Europe

10. Overview: UK • Recent development: costs budgeting • Applies to “multi-track” cases with value less than £10 million • Detailed costs schedule required at outset of proceedings • Parties must agree costs, or court will impose order • Costs recovery claims compared to agreed budgets • At this stage, High Court only, not IPEC

11. Overview: UK • Shortened & Flexible Trial Schemes • Shortened trial: same judge throughout, listing for hearing 10 months after claim served • Judgement within 6 weeks after trial • Maximum trial length 4 days • Intended for simple cases

12. Overview: UK • Flexible trial: parties agree to adapt trial procedure to case • Trial procedure includes pre-trial disclosure, expert evidence, submissions at trial • Intention is to limit disclosure & evidence at trial • Shortened & flexible trial schemes non-mandatory • Both parties must agree • Pilot schemes at present

13. Effect of UP & UPC • Much already written about UPC Agreement • In my view, two very significant aspects • Optional bifurcation • Privilege • Bifurcation allows German Local Divisions to proceed according to familiar principles • Privilege a new concept for some European lawyers

14. Effect of UP & UPC • Privilege very different from confidentiality obligation • Privilege perpetual, cannot be waived by one party alone • In English law defined in decided cases, starting in 1570 • CDPA 1988 defined patent attorney privilege as the same as (case law derived) solicitor privilege • UPC Agreement & Rules attempt to define statutory privilege for representatives from scratch • Not the best starting point?

15. Will the UPC Agreement Survive? • UK Referendum vote in June 2016 has cast future of UPC Agreement into doubt • As drafted, UK ratification essential for implementation of UPC • UK Government probably now sees ratification as a Brexit bargaining chip

16. Will the UPC Agreement Survive • Question over whether UK can participate post-Brexit • Some (e.g. Prof Tilmann, Hogan Lovells) say yes • Minor amendment of UPC Agreement required to allow UK to participate as an EEA member • Others (Prof Dr Thomas Jaeger, Universität Wien) say no • Article 50, Lisbon Treaty does not permit amendment of EU regulations, so Brexit negotiations cannot have the above result

17. Will the UPC Agreement Survive? • Format of UPC therefore up in the air at present • Maybe it won’t happen at all • If UK not a participant, value of UPC arguably significantly diminished • UK a major European economy • Largest English-speaking country in Europe • Vast legal profession & expertise • UK courts would actively compete with UPC if UK not included

18. Questions, discussion? • Many aspects are imponderable at present • Things may become clearer as UK negotiating position established

19. For more information please contact: Chartered Institute of Patent Attorneys 95 Chancery Lane, London WC2A 1DT Telephone: +44 (0) 207 405 9450 Email: info@cipa.org.uk www.cipa.org.uk IN ASSOCIATION WITH