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MIP European Patent Forum USA 2015: Key takeaways from Silicon Valley

Alice O’Donkor summarises the presentations and discussions from the European Patent Forum USA, held on December 10 at the Fairmont San Jose Hotel, San Jose



The Unitary Patent and Unified Patent Court: An update

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·         It is expected that all divisions will have English as the lead language

·         A  European Patent with Unitary Effect is a single patent right, examined and granted by the EPO. It does not cover non-EU EPC states (such as Switzerland, Norway, Turkey)

·         It's a unitary right, not a bundle of rights. Patent owners will be unable to opt out from some jurisdictions and stay registered in others, as with the current system. It is “more extensive, less expensive” – according to Penny Gilbert of Powell Gilbert

·         It is possible to opt-out from the UPC jurisdiction, at the cost of €80 per patent (price tbc)

·         Factors to consider in selecting UPC division: language, convenience for parties and cultural approach of local judges to procedural tools

·         UPC proceedings are expected to be heard within a year. “Time is of the essence,” said Sabine Agé of Véron & Associés.

Patent Enforcement in Europe: Deciding on your strategy

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·         Consider cost, success rate and what your party will gain from a decision

·         Possible effects of the decision include injunction as a matter of right, damages for infringement and revocation or limitation of the patent

·         The UPC promises to be more efficient than some national forums: hearings will be restricted to a single day

·         Fees for infringement set at €11,000 with additional fees applicable if value of litigation exceeds €500,000.

·         Must sue for infringement in local or regional division where infringement occurred or where defendant is domiciled

·         If one defendant is outside the contracting member states, or infringement occurred in a territory where there is no local or regional division – refer to Central Division

Frand: Licensing and litigating standard essential patents in Europe

·         FRAND =  fair, reasonable and non-discriminatory

·         FRAND terms agreed through bilateral negotiation between SEP owner and implementer

·         The IPR policy of the SSO will typically require patent owners to declare any patents that they consider are, may be, or may become SEPs

·         Patent owners participating in SSOs must resolve to grant irrevocable licences for their SEPs on FRAND terms (the “FRAND commitment”)

·         FRAND terms must be agreed through bilateral negotiation between SEP owner and implementer

·         Anna Johns of Inventergy addressed the potential challenges that patent licensors face when trying to license their SEPs and how the Huawei v ZTE decision might affect some of these challenges

 

Litigation planning and forum shopping in Europe

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·         Consider the objectives of your party and adversary, possible tactics of the opposition and your reactions, timing and cost constraints

·         Any European patent/application granted or filed during the transitional period can be opted out of the UPC for the life of the patent

·         National patent systems remain and will act alongside the UPC

·         Not all member states have signed the UPCA (Spain, Poland have not) and all may not have ratified by the time the court goes live (expected early 2017)

·         Joachim Feldges of Allen & Overy described litigation as “a dance at least for two – or maybe three with the court dancing with you”.

Working with your European Patent Attorney

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·         At present, three different types of patent protection available in Europe: European patents, national patents, utility models

·         National court is main forum for litigation in each state

·         Understand the effects on your existing European patents and pending European patent applications, develop filing strategy accordingly

·         Opposition and appeal available at EPO

·         Request unitary patent within one month from grant of European patent

·         Pros of opting out: avoid central attack and avoid third parties forcing you to untested court

·         Cons: cannot obtain pan-European injunction, nor obtain pan-European damages

 

Opposition proceedings before the UPC

·         AIA opposition proceedings (PGR, IPR, CBM) must be completed within 12 months from institution decision by PTAB, with six-month extension possible for good cause

·         Final PTAB decision prevents further challenge in USPTO, ITC or district court

·         Prepare prosecution in anticipation of post grant challenges

The impact of the UPC on IT & technology

·         Outcomes of EPO oppositions will take effect in all EPC states

·         DNI proceedings will take place in Central Division

·         Large-scale cross-licence negotiations extended in TMT

·         Determination of essentiality not within UPC’s exclusive competence, remains within the national courts

·         FRAND deployed as defence to infringement or in licensing disputes

FOCUS: Life sciences & pharma

·         In injunctions, in contrast to the US, no need to prove irreparable harm. Damages can be awarded simultaneously

·         FDA Safe Harbour/Bolar Exemption: UK has a restrictive interpretation limited to generics while other EU members (Germany, Ireland) have a broader interpretation

 

Alternative dispute resolution strategies

·         Parties control: identity of arbitral seat, location and start date of hearing

·         Arbitration is jurisdiction-specific

·         Patent disputes can be arbitrated, but revocation cannot be ordered

·         Court proceedings, not open to the public and decisions are usually confidential

·         Arbitration concludes in one decision which will apply to multiple jurisdictions. This is particularly effective when dispute focuses on damages.

Additional reporting by Natalie Canter



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