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IP strategies for Indian Companies to enter the European Market by Thomas Schuster. 8th Annual International Seminar of MarkPatent.org on International Property rights. a.) Obtaining IP rights --What kind of IP rights can I have?
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IP strategies for Indian Companies to enter the European Market by Thomas Schuster 8th Annual International Seminar of MarkPatent.orgonInternational Property rights
a.) Obtaining IP rights --What kind of IP rights can I have? --What kind of IP rights are useful for me? b.) Enforcing IP rights -- Where and how can I enforce my IP rights -- What to do when others enforce their rights against me Different Aspects of IP
From the above maps it can be seen that Europe and The European Union are different. E.G Swiss and Nor- way are in Europe, but they don`t belong to the European Union. So we have to differentiate between EU- Protec- tion rights and national rights or groups of national rights in Europe. Europe and the European Union
Rights which can be obtained for the EU: - community design - community trademark So far - no community patent - no community utility model Various Protection Rights in the EU and Europe
- National Patents in almost all EP-countries -- through national filing and granting by national Patent Offices -- through filing and granting by European Patent office - National Utility models in some countries ( e.g. Germany, Spain, Italy) - National Trademarks - National Designs National IP rights in Europe
Please note: EP Patent is no Community patent It is a common patent examination procedure for now 38 European European countries, but after grant it channels into national Patents only in those countries for which the Patent owner fulfills the validation requirements. (some countries require complete translation of the application, others only of the claims ( London protocol)) EP – Patent
European patent system European Application filed at EPO Common examination procedure for 38 countries Grant Uk Fr DE It
Direct (or Paris Convention) filings at - National Patent offices for national patents, utility models, trademarks, designs, (need local representative) - European Patent Office in Munich for obtaining EP Patent (need European Patent attorney) - Community Trademark Office in Spain for filing community trademark or community design (any Patent- or Trademark Attorney can do) Ways to enter Europe with direct IP filings
When entering Europe from a PCT-application, please note that for some countries like France, Italy, Belgium, it is not possible to file national phases directly at the respective offices The only way to do this is through EPO filing. This is important to know when you make strategic considerations about costs. We will talk about it later. Entering Europe via PCT
What kind of IP is useful for me Important considerations for finding the right filing strategy: - where are my major markets - where are my major competitors - costs
Markets in Europe European Union: 27 countries: 500 Mio People Germany 82 Mio France 62 Mio United Kingdom 61 Mio Italy 60 Mio Spain 46 Mio
Options If the product is interesting for more than 4 EP countries : file EP Patent - via PCT - via Paris Convention filing Costs: from filing to grant and validation can be anything from 10.000 € ( 3 countries, no translation) to 150.000 € ( all 38 countries with translation )
Options If protection in some major EP countries such as Germany and/or France and/or UK and /or Italy is sufficient: Cover by national Patent filing only: For Germany: through PCT or Paris Convention For UK: through PCT or Paris Convention For France: through Paris Convention only For Italy: through Paris Convention only
Cheapest protection Utility model in Germany -- covers 82 Mio people -- registered fast (2 months) without examination (but request search so you know about its validity) -- can be enforced and gives the same rights as a Patent, but only for 10 years -- Costs (depending on translation-volume) between 1000 and 2000 €
Flow chart of favourite cheap system for obtaining protection for bigger Part of Europe Chinese Application 12 m PCT application Nat. France Nat. Italy 30 m DE nat. JP US Utility branch 7 Y Examin.
Pros and cons for filing system of previous slide Advantages: Flexible, effective, rather fast protection in eg. Italy and France, good possibilities Disadvantages: Protective rights are granted in different languages. If you work with smaller law firms they might have to involve associated Law firms in the respective countries.
Additional IP rights Always also think about additional protection by trademarks and design. In trademarks and designs it is not worth doing national filings, as the community filings are cheap and easy. Costs for Com. Design per design: about 1500 € Costs for Com. Trademark for 3 classes: about 1200 € All these filings can be handled by any law firm located in a European Community country.
IP related Preparation for entering the European market with own product Before coming on the market with an own product: -- name search on competing companies ( cheap) -- freedom to operate search (can be expensive, but can be limited and conducted stepwise) -- prior art search –ev. start attack ( invalidation action) -- evaluate possibilities to take license -- Choose own design, own trademark -- be careful with what you show and say in leaflets -- Protective briefs -- obtain your own rights
Patent Enforcement inEurope The enforcement of IP-rights within the European Union is, for the most part, still left to national laws of the individual member states. Although since 2004 there is an EU directive to harmonize enforcement of IP rights, ( enforcement directive), in Practice there are still major differences between the systems. In Europe by far the most patent Litigation cases are handled in Germany. Although there are no clear statistical data available some published figures mention for 2008 about 1300 cases in Germany against about 120 cases in France and only 60 cases in the UK.
Some Reasons why most Patent Litigations are handeled in Germany (as compared to other European countries) Advantages: - patent-owner friendly - fast and rather straight forward - judges not biased against foreigners - broad scope of protection by doctrine of equivalence. - relatively inexpensive - loser pays Disadvantages: - limited discovery - non European Plaintiff needs to place bond
What German Court should be chosen to sue As Plaintiff in a patent case you could either sue at place of infringement ( e.g.Trade-fair ) or at seat of the defendant. In most cases place of infringement can be established everywhere, because most defendants offer their goods in the internet and that is an offer all over Germany. So having the freedom to select court most plaintiffs choose Mannheim or Duesseldorf court. Difference: Duration of first instance in Duesseldorf 13 months, in Mannheim only 6 months.
Available measures - Preliminary injunction - Provisional court order to preserve evidence - Patent infringement action - Border seizure - Cross Border injunctions
Preliminary injuction Requirements: • Infringement and validity must be without reasonable doubt • Urgency: start action within 4 weeks after having learned about infringement. (some courts up to 4 months) In practice: • Courts are more and more reluctant in granting preliminary Injunctions. - Some chances if patent already went through opposition or nullification actions.
Provisional Court order to preserve evidence Since the issuance of the EU-IP-Rights-Enforcement Directive in 2004 member states had to implement regulations to ensure, that even before a lawsuit is initiated , a party which has presented reasonable evidence to support its infringement claim may request provisional measures to preserve relevant evidence in respect to the alleged infringement. In Germany this resulted in a change of the Patent law by introducing art 140 a) to d) and it now happens more and more, that such Request are granted e.g. on trade fairs, where with a court order evidence of infringing products can be taken.
German Litigation Procedure • Complaint brief is filed with competent court comprising motions and compete grounds for motions. • Court feesare to be paid • Complaint is served on the defendant by court • Defendant files brief with counter arguments • Eventually one or more exchange of arguments in further briefs • Oral Hearing after 6 to 14 months depending on the court • Hearing will last between 1 and 3 hours • Decision about 1 to 2 months after the hearing
Costs of Litigation through 2 Instances Costs depend on value in dispute. Cost risk for two instances in average case including litigation between 100.000 and 300.000 € (In France at least 2 times, in UK about 3 times more.)
Validity In German Litigation, Validity is no defence argument. It has to be brought up in a separate nullification action at the Federal Patent Court. The success rate in 2009 was about 45 %.
Special District Court (e.g. LG Düsseldorf, LG Mannheim) Validity - Infringement Bundespatentgericht Federal Patent Court (Munich) Appeal 7-18 m 12-24 m Bundesgerichtshof (Federal Supreme Court) Higher District Court (e.g. OLG Düsseldorf, OLG Karlsruhe) 12-18 m 3-4 y Revision Bundesgerichtshof (Federal Supreme Court) *If there are any doubts as to the validity of the patent, the infringement proceedings may be stayed until the validity proceedings are terminated. 3-4 y*
Statistics of Invalidation Actions in Germany (2009) 230 new cases in 2009, 230 cases per year are settled 390 cases pending 1/3rd of the litigated EP patents, 1/4th of the litigated DE patents end up in an invalidation action average duration of the first instance: ca. 20 months 60% of the cases are appealed, average duration of appeal: 3 to 4 years; Success rate: about 30% total, 30% partial revocation
Border seizure Motion for Border seizure: - Make border controls (customs) aware of IP - Global motion for all counterfeits and single motion for pertaining to a single shipment only - Material needed: Proof of existing patent White list for showing original product Black list for counterfeits Power of attorney form (Bank guarantie no longer needed) - Grant within 2 days to 3 weeks
Border seizure itself - Decision by Border controls whether to seize or not • Hold back potentialy infringing goods • Information of right owner • Right owner confirms or denies that product is counterfeit • Customs seizes or releases
Costs of Border seizures Costs are minimal: Attorney fees about 1000 to 1200 € Official fees about 300 € Ev. Additional costs for Storage and destruction
Cross border injunctions; EU regulation on Jursdiction If several national parts of an EP- Patent are infringed the patent owner can choose to sue: - in only one country - In one ore more or all countries - File a single suit for cross border injunction in one selected member state Principle: Scope of claim in theory should be same all over Europe, (because of art. 69 Protocol). Harmonized claim Interpretation is however mere theorie so far. In practice european Courts in the various countries declare themself to not be the right legal instance and dont render cross border injucions frequently
Final remark Although from a first glance the IP approach to Europe seems to be somehow complicated because of the various national and EU-wide systems there are reasonable strategies available, to obtain reasonable and cost-effective own protection rights and to inforce those rights.
