Advantages and Disadvantages of the European Unitary Patent System

Houston Journal of International Law

Chance Moser

2

Table of Contents

Current Patent Frameworks in Europe. ......................................................................... 4

European Patent Office Route ........................................................................................................ 4

Member State’s Patent Office Route ............................................................................................ 5

Requirements for the Unitary Patent System to become Law. ..................................... 6

German Constitutional Challenge ................................................................................................. 8

Advantages and Disadvantages of the Unitary Patent ................................................ 10

Pan-European Protection ............................................................................................................. 11

Economic Assessment .................................................................................................................... 16

Time to Grant .................................................................................................................................... 24

Structure and Jurisdiction of the Unified Patent Court.............................................. 26

Structure of the UPC ....................................................................................................................... 27

Jurisdiction of the UPC ................................................................................................................... 31

Advantages and Disadvantages of the Unified Patent Court ...................................... 34

Forum Shopping ............................................................................................................................... 34

Patent Troll Propagation .............................................................................................................. 38

Speed of Litigation........................................................................................................................... 42

Selection of Judges .......................................................................................................................... 43

Brexit Impacts ................................................................................................................. 48

Conclusion ....................................................................................................................... 53

3

Advantages and Disadvantages of the Unitary European Patent System

The Unitary European Patent (“Unitary Patent”) will cover the majority of Europe,

allowing an inventor to attain patent protection across almost the entire continent with a single

patent.1 This new Unitary Patent will also come coupled with a new court that will have exclusive

jurisdiction over it, the Unified Patent Court (“UPC”).2 As Americans, it is imperative that we

have a firm grasp on the evolving patent structure in Europe generally, and the EU specifically, if

for no other reason that the US accounts for the country of origin for the most European patent

applications.3 While the promise of pan-European patent protection over intellectual property does

sound appealing, it is not without its pitfalls that potential patentees must be aware of before

embarking on the path to a Unitary Patent.

1 Regulation 1257/2012 of the European Parliament and of the Council of 17 Dec. 2012,

implementing enhanced cooperation in the area of the creation of unitary patent protection, O.J.

(L. 361/1).

2 Agreement on a Unified Patent Court, 2013 O.J. (C 175).

3 European Patent Office, European Patent applications per country of origin (2017)

(Showing the current statistics of the country of origin of patent applicants at the EPO),

https://www.epo.org/about-us/annual-reports-statistics/annual-report/2017/statistics/patent-

applications.html#tab2.

4

Current Patent Frameworks in Europe.

If a patentee desires to attain patent protection in Europe there are currently two separate

paths that can be taken.4 The most common track is through the European Patent Office, while the

other route is through each individual Member State’s national patent office.5 These systems both

have their own individual advantages and disadvantages, dealing exclusively with the prosecution

stage of the application, but they both end with the patentee holding a bundle of national patents.6

European Patent Office Route

The European Patent Office (“EPO”) was established in 1973 by the European Patent

Convention in an effort to harmonize the patent law in the various European countries.7 This route

through the EPO is by far the most common for patentees seeking patent protection across multiple

European jurisdictions.8 The main advantage of a patentee taking this route is the simplicity in the

4 See Martin Nohlen, Key issues to consider when assessing whether to file for EU patent

protection, Lexology (April 11, 2016)

https://www.lexology.com/library/detail.aspx?g=a5477752-56d6-4def-8541-65024e23732f.

5 See generally, Id.

6 Id.

7 European Patent Office, Encyclopedia Britannica (last updated June 18, 2013),

https://www.britannica.com/topic/European-Patent-Office.

8 See generally, Id.

5

prosecution; having a single application, a single patent examiner, a single office to send

documents and responses to, and a single fee schedule.9 This represents a real advantage to

patentees, so they can avoid confusion within their own patent portfolio. This single patent

application can then be validated and translated into a bundle of national patents, where the

patentee has control over which countries he wants to be included in that bundle.10

Member State’s Patent Office Route

The potential to prosecute a patent through a Member State’s internal patent office will still

be available through the Unitary Patent Court Agreement (“UPCA”) and the Unitary Patent

Regulations.11 A patent prosecuted through a Member State is governed solely by the internal laws

of the Member State, and is subject to any and all administrative hurdles that the Member State

deems necessary.12 The Member State can only issue a patent that is enforceable within its’

9 See generally, Id.

10 See Christoph Cordes, The Unitary Patent and the Unified Patent Court, 49 Les

Nouvelles 184 (2014).

11 Id.

12 See, e.g., Ernst K. Pakuscher, Patent Procedure in the Federal Republic of Germany, 4

Int'l Tax & Bus. Law. 86 (1986).

6

national boundary.13 This route can be crucial to potential patentees that would want a patent to be

issued as quickly as possible and are not concerned about having a broad geography of protection.

Some Member States, such as France, have gone so far as to set up accelerated routes to patent

grants through their national office.14 Efforts such as these are to combat the sluggish rate at which

the EPO issues patents and to entice potential patentees to go directly through their national

office.15

Requirements for the Unitary Patent System to become Law.

The Unitary Patent and the UPC were brought about through two different mechanisms of

European Union (“EU”) Law.16 The Unitary Patent comes from a regulation of the European

Parliament while the Unified Patent Court comes from a separate agreement, the UPC, from the

13 See, e.g., Cabinet Beau de Loménie, The French Patent System, (Illustrating the

territorial boundaries that a French patent has) (2017), http://www.bdl-

ip.com/upload/Etudes/uk/french_patent_system.pdf.

14 Institute of Intellectual Property, Accelerated Patent Grant, (France)

https://www.inpi.fr/fr/services-et-prestations/delivrance-acceleree-de-brevet.

15 Mewburn Ellis, European Patents: The Basics Flow Diagram, http://mewburn.com/wp-

content/uploads/2015/03/EP-Patents-The-Basics-Flow-Diagram.png.

16 Regulation 1257/2012 of the European Parliament and of the Council of 17 Dec. 2012,

O.J. (L. 361/1) and Agreement on a Unified Patent Court, 2013 O.J. (C 175).

7

European Council.17 that will have to be ratified by the parliaments of the individual Member

State’s for the entire system to come into effect.18 The regulation’s date to come into full effect

was put off until the UPCA was ratified by at least 13 Member States, which had to include

Germany, France, and the United Kingdom (“UK”).19 The extra requirement to have Germany,

France, and the UK ratify the UPCA was to ensure that the three jurisdictions that had the most

patent activity in Europe had a say as to when the Unitary Patent and UPC came into existence.20

As of the writing of this piece, France, the UK21, and 16 other countries have ratified the UPCA.22

17 UPCA, supra note 2.

18 Id. and Regulation 1257/2012 of the European Parliament and of the Council of 17 Dec.

2012, O.J. (L. 361/1).

19 Id. and Regulation 1257/2012 of the European Parliament and of the Council of 17

Dec. 2012, O.J. (L. 361/1).

20 See Plesner Advokatpartnersilskab, When will the UPC system enter into force?, (last

visited Feb. 11, 2019, https://www.plesner.com/speciale/upc/hvornaar-traeder-upc-i-

kraft?sc_lang=en.

21 Roger Green, Unitary Patents almost a reality - UK signs the Unified Patents Court

Agreement, Watermark Intellectual Property (April 27, 2018),

https://www.lexology.com/library/detail.aspx?g=82b95121-c0f5-4737-9b7d-b347c01166de.

22 UPCA, supra note 2.

8

It is also important to be cognizant that the ratification of the UPCA for the UK came in

the span of time after the Brexit referendum occurred, yet before the UK has officially left the

EU.23 The UK has shown intentions of staying within the framework of the Unitary Patent and the

UPC, but a post-Brexit deal has yet to be struck between the UK and the EU which could change

the UK’s access to the system.24 The UK’s posture towards the Unitary Patent System and the

EU’s reciprocal posturing will be explored further in the “Brexit Impacts” section of this piece.

German Constitutional Challenge

The noted exception of countries that many would expect to support a tighter integration

of countries into the EU, is Germany.25 Germany is currently facing a constitutional challenge to

23 Green, supra note 21.

24 Alexander Robinson, UK Confirms Intention To Remain In Unitary Patent System

After Brexit, Dehns (July 17, 2018),

http://www.mondaq.com/uk/x/719880/Patent/UK+Confirms+Intention+To+Remain+In+Unitary

+Patent+System+After+Brexit.

25 Gabriela Baczynska and Jan Strupczewski, Germany and France to lead post-Brexit EU

in further integration, Reuters (June 27, 2017), https://www.reuters.com/article/us-eu-future-

timmermans/germany-and-france-to-lead-post-brexit-eu-in-further-integration-idUSKBN19I14O

and Richard Pinkney, Complaintant in UPC German constitutional challenge publishes update,

9

the validity of the UPCA from one of its’ own individual citizens.26 This citizen’s case must be

resolved before the UPCA can be ratified fully by the German Parliament, and pass into full law

across the EU.27 From most German Constitutional law scholars, the current case appears to

challenge the UPCA on predominantly procedural grounds and is expected to be dismissed or

rejected.28

Bristows LLP (Mar. 7, 2018), https://www.bristowsupc.com/latest-news/complainant-in-upc-

german-constitutional-challenge-publishes-update/.

26 Richard Pinkney, Complaintant in UPC German constitutional challenge publishes

update, Bristows LLP (Mar. 7, 2018), https://www.bristowsupc.com/latest-news/complainant-in-

upc-german-constitutional-challenge-publishes-update/.

27 Kieren McCarthy, Europe's Unified Patent Court fate in the balance amid German

probing (yes, Brexit is in the mix) (February 22, 2018),

https://www.theregister.co.uk/2018/02/22/european_patent_court_under_doubt_as_german_cour

t_agrees_to_take_on_case/.

28 See Hogan Lovells, UPC and Germany: Status Update – Constitutional Complaint,

Ratification Timeline and more, (Oct. 17, 2017), http://www.theunitarypatent.com/news/upc-

and-germany-status-update-constitutional-complaint-ratification-timeline-and-more.

10

However, this is only conjecture since the official claim has yet to be published by the

German Constitutional Court.29 No matter the outcome, this action will undoubtedly push the

enactment of the UPC, and the Unitary Patent, optimistically into late 2019, most likely into

2020.30

Advantages and Disadvantages of the Unitary Patent

In the current framework, there is a single patent application through the European Patent

Office (“EPO”) and then multiple national patents are issued for the different countries that the

patentee wishes to cover.31 This fragmentation across multiple national patents gives the patentee

an inherent safety net from invalidation efforts against the patent, forcing an invalidator to file an

action in each jurisdiction individually.32 The current system also allows for the patentee to be

selective in which parts of the European market that they would want to target, limiting their

invalidation liability. In addition to being able to select their markets at the grant of the patent, a

29 See Id.

30 Id.

31 European Patent Office, The Patenting Process (2018) (outlining the current steps for

obtaining a European patent through the EPO), https://www.epo.org/learning-

events/materials/inventors-handbook/protection/patents.html.

32 David Medina, How the Unitary Patent Will Fragment European Patent Law, 47 Ariz.

St. L.J. 319, 321 (2015).

11

patentee can also drop certain underperforming markets by ceasing payment of renewal fees in

those markets, thereby limiting their patents liability post grant.

Pan-European Protection

The main advantage that proponents of the Unitary Patent will point to most with the

Unitary Patent is the pan-European protection that a patentee will now have access to.33 This will

allow a patentee to initiate a single action in front of the UPC and seek a single injunction order,

or infringement suit, to enforce the patent across the EU.34 While this is true, and depending on

the particular patentee it could be very advantageous, it is not without its inherent downsides. The

trade-off for the near continent-wide protection is continent wide liability for patent invalidation.35

With a current European patent, the patentee holds the equivalent of a bundle of national

patents, if he or she wishes to enforce the patent by an injunction, he is forced to go to each Member

States’ court’s and litigate for an injunction.36 Even if the patentee has a valid case, and wins on

33 The Unitary Patent New Opportunities and Integration of European Patents, 8 Landslide

43 (2016).

34 Bruce Sunstein, The New European Unitary Patent: All Your Eggs in One Basket, 2013

WL 622909, at *1.

35 Id.

36 Tilman Müller-Stoy & Florian Paschold, Unitary Patent and National Law, 50 Les

Nouvelles 57, 59 (2015).

12

the facts, the infringer can simply pick up their operation and move to a different jurisdiction and

start again. Then, assuming a patentee has protection in that new jurisdiction, the patentee has to

fight the same fight all over again.37 This is not beneficial for the patentee, since they may have to

litigate essentially the same case, against the same infringer, multiple times in multiple different

jurisdictions as an expensive game of “cat and mouse”.38

One concrete advantage of the Unitary Patent is that if a patentee holds a Unitary Patent, a

single case before the UPC will allow them to attain an injunction against an infringer and it be

valid across almost the whole of the EU.39 Shown below is a representation of the jurisdiction that

the Unitary Patent will cover, as of the writing of this piece Poland & Spain have opted out of the

UPC and it’s jurisdiction but will continue to participate in the Unitary Patent.40 Poland has opted

out because of Brexit-like feelings of home rule, not wanting to give up more power to an EU

37 Philip P. Soo, Enforcing A Unitary Patent in Europe: What the U.S. Federal Courts and

Community Design Courts Teach Us, 35 Loy. L.A. Int'l & Comp. L. Rev. 55 (2012).

38 See generally, Id.

39 Plesner Advokatpartnerselskab, Map of UPC Countries, last visited Feb. 11, 2019,

https://www.plesner.com/speciale/upc/upc-kort?sc_lang=en.

40 Dr. Markus Gampp and Richard Taylor, Unitary Patent and Unified Patent Court,

DLA Piper L.L.P. (last visited January 9, 2019), https://www.dlapiper.com/en/czech/focus/upc/.

13

institution.41 Whereas Spain has opted out mainly on principle of a protest for the Spanish language

not being one of the main requisite languages of the Unitary Patent.42 The potential cost savings

for patentees seeking to practice their technology could be tremendous on both the prosecution

phase of the patent but also in the enforcement phase of the patent’s life cycle.43 These cost savings,

which are further explored in the “Economic Assessment” section of this piece, can be rolled over

to financing the renewal fees to maintain this near continent wide patent protection.

41 Marek Łazewski, Whatever happened to Polish support for Unified Patent Package,

International Association for the Protection of Intellectual Property (May 2013),

https://www.aippi.org/enews/2013/edition30/Marek_Lazewski.html.

42 Manuel Rey-Alvite Villar, Spanish government provides its reasons not to join the

unitary patent and UPC system, Bristows LLP (Mar. 22, 2017),

https://www.bristowsupc.com/latest-news/spanish-government-reasons-not-to-join-unitary-

patent-upc-system/.

43 See generally, Sofia Kopelevich, "The Impact of the Unitary Patent and the Unified

Patent Court on the Prevalence of Patent Trolls in the European Union" (2017), Seton Hall

University https://scholarship.shu.edu/student_scholarship/895.

14

Figure 1: Map showing the wide jurisdiction that the Unitary Patent will have.

The danger of Pan-European protection is that a patentee can have his patent invalidated

by a single revocation suit, brought by any entity, from any part of the EU.44 To some patentees,

44 Paul Roscoe, Unpacking the EU Patent Package: The Unified Patent Court, Finnegan

L.L.P. (April 5, 2016), https://www.finnegan.com/en/insights/blogs/european-ip-blog/unpacking-

the-eu-patent-package-the-unified-patent-court.html.

15

this liability may be too great for them to bear with the UPC given such wide discretion in areas

such as temporary injunctions.45

Take a scenario, where a British man attains a European patent through the EPO and has it

validated in Germany, France, the UK, and the Netherlands. A revocation action is brought against

the patent in Germany and France with the patent being revoked in each jurisdiction. The patentee

in this scenario still has patent protection in the UK and the Netherlands, allowing his business to

continue to operate in these jurisdictions with patent protection. Take the same scenario except

now the patentee has a Unitary Patent, now when the revocation suit is brought and is successful,

the patentee now has no patent protection at all in the EU. This could potentially destroy a business

whose business model depended on the exclusivity to practice their technology that patent

protection provides.46

Patent practitioners operating in the EU will have to counsel their clients intensely to

determine what they are willing to accept as liabilities from the Unitary Patent and what upsides

they can expect from this wide protection. This type of initial interview with potential patentees is

important now, it will become imperative once the Unitary Patent comes into effect.

45 See Kopelevich, supra note 43.

46 Id.

16

Economic Assessment

One of the reasons for Europe’s lag in innovation compared to the U.S. has been the overall

cost of obtaining and enforcing that same patent protection.47 The EU’s overarching attempt at

catching up to the U.S. will be the Unitary Patent System.48 The thought process behind the Unitary

Patent that it will integrate well with the Single Market that the EU already has in place.49 Other

EU countries such as Estonia have other initiatives such as it’s e-residency program to attempt to

bring innovation to Estonia and the EU at large.50 This program makes it easier for people from

outside the EU sell their products in the EU’s single market as a company from a trusted EU

47 See Gail Edmonson, European Patent Office Enters New Era: Managing the EU

Unitary Patent, (March 6, 2013), http://www.sciencebusiness.net/news/76068/European-Patent-

Office-enters-new-era-managing-the-EU-Unitary-Patent; see also Alexandra Dominique

Danielle Theben, Unitary Patent Protection Under Enhanced Cooperation: Is an EU patent

feasible in the future? (Jan. 2014) (unpublished M.S. thesis, University of Twente), available

at http://essay.utwente.nl/64408/.

48 Id.

49 Benoît Battistelli, The Unitary Patent: Origins and Role as a Driver of Innovation and

Growth, 51 Les Nouvelles 24 (2016).

50 See generally E-Residency, How to Start a Company (2018) (Estonia), https://e-

resident.gov.ee/start-a-company/.

17

country.51 Another way the EU is attempting to spur innovation is to take a tougher stance on

intellectual property enforcement.52

An advantage to the Unitary Patent is the geographical coverage that a patentee can obtain

for a relatively low cost in renewal fees.53 For the same geographical area that the Unitary Patent

will cover, a patentee would currently have to spend €169,658.00 from a bundle of national patents

as opposed to €35,555.00 with a Unitary Patent over the life of a standard 20-year patent.54 To stay

competitive, the Unitary Patent will have its renewal fees set by a combination of the four

European countries with the most patent activity. 55 These savings can be huge for a patentee that

51 Id.

52 European Commission Press Release, Security Union: Commission steps up efforts to

tackle illegal content online, (2017), http://europa.eu/rapid/press-release_IP-17-3493_en.htm.

53 European Patent Office, Cost of a Unitary Patent (2018) (Showing the total cost of the

Unitary Patent and the 26 EU Member States), https://www.epo.org/law-practice/unitary/unitary-

patent/cost.html.

54 Id.

55 European Patent Office, Business-friendly fee pattern adopted for the unitary patent

(June 24, 2015), https://www.epo.org/news-issues/news/2015/20150624.html.

18

is looking to launch a business off of the patent and can save valuable capital, especially in the

first years of the life of the patent.56

The savings from the prosecution phase will not just come from renewal fees, but from the

implicit administrative costs that a patentee will have to incur to prosecute a similar bundle of

patents through various Member State’s patent offices.57 This not only includes translation fees,

but paying for know-how to ensure that the patent is prosecuted through each office seamlessly.58

This a large draw for patentees that believe their patent is viable across the whole European market,

given that the EU operates under a single market regime with no internal tariffs between the

Member States.59

This premise however, operates under the assumption that the patentee wants patent

protection across all of Europe, as opposed to just a few countries where the patentee thinks that

his or her technology will have a stronger market presence. In this scenario, shown more fully in

Table 1 and Figure 2, the economics of the Unitary Patent begin to look like a significant burden

56 Id.

57 See generally, Id.

58 Franks & Co., European Patent Procedure Explained, (Last visited Feb. 16, 2019),

https://www.franksco.com/Data/News_Downloads/EuropeanPatentProcedureExplained.pdf.

59 Consolidated Version of the Treaty on the Functioning of the European Union art. 26,

June 7, 2016, O.J. (C 202) 59.

19

that the patentee must bear.60 Take a scenario where a patentee only believes that his patent is

viable in the German, French, and UK markets. In this situation, a patentee can either attain a

Unitary Patent or 3 national patents that cover the respective nations individually.61 Over the

course of a 20-year patent, the patentee will have to cover €35,555 for a Unitary Patent as opposed

to just €24,380 to cover Germany, France and the UK individually. 62 This presents a significant

savings just from the renewal fees, savings that could be quickly rolled over into funding the next

round of research for a company or be put towards aggressively enforcing the 3 separate patents.

Table 1: Renewal fee costs for different European Member States and the Unitary Patent.

Year Unitary Patent

(EUR)

26 Member States

(EUR)

Germany

(EUR) UK (GBP)

France

(EUR)

2 35 494 70 N/A 38

3 105 1,371 70 N/A 38

4 145 1,746 70 N/A 38

5 315 2,443 90 70 38

6 475 3,110 130 90 76

60 See generally, Reddie & Grose LLP, How Much More Will the Unitary Patent Cost?,

(Jan. 2013), http://www.reddie.co.uk/M/R&G_UnitaryPatentCost.pdf.

61 See generally, Bruce Sunstein, The New European Unitary Patent: All Your Eggs in One

Basket, 2013 WL 622909.

62 European Patent Office, Cost of a Unitary Patent (2018) (Showing the total cost of the

Unitary Patent and the 26 EU Member States), https://www.epo.org/law-practice/unitary/unitary-

patent/cost.html.

20

7 630 3,801 180 110 96

8 815 4,632 240 130 136

9 990 5,617 290 150 180

10 1,175 6,609 350 170 220

11 1,460 7,789 470 190 260

12 1,775 9,005 620 220 300

13 2,105 10,309 760 260 350

14 2,455 11,586 910 300 400

15 2,830 12,877 1,060 360 450

16 3,240 14,462 1,230 420 510

17 3,640 15,972 1,410 470 570

18 4,055 17,490 1,590 520 640

19 4,455 19,302 1,760 570 720

20 4,855 21,043 1,940 610 790

Total 35,555 169,658 13,240 4,640 5,850

Another cost savings that the Unitary Patent will enjoy will be the near elimination of the

translation fees.63 A Unitary Patent will only be required to be published in only two EU languages,

63 Eden Estopace, European Patent Office Promises to Cut “High Translation Costs”,

Slator (Aug. 23, 2017), https://slator.com/demand-drivers/european-patent-office-promises-cut-

high-translation-costs/.

21

one of which must be English.64 These translation costs can, and in many times are, an economic

barrier that prevents a patentee from seeking patent protection in more jurisdictions.65

64 Regulation 1260/2012 Art. 6(1) of the European Parliament and of the Council of 17

Dec. 2012, O.J. (L. 361/1).

65 See Dehns LLP, Translation costs for granted European Patents, (Feb. 2017),

https://www.dehns.com/cms/document/Translation_costs_for_granted_European_Patents.pdf.

22

Figure 2: Renewal fees of a Unitary Patent contrasted with the renewal fees to cover the same

geographical area under the current national system framework.66

66 European Patent Office, Cost of a Unitary Patent (2018) (Showing the total cost of the

Unitary Patent and the 26 EU Member States), https://www.epo.org/law-practice/unitary/unitary-

patent/cost.html.

23

Figure 3: Renewal fees in just Germany, France, and the UK compared to the renewal fees of the

Unitary Patent.

This does not begin to speak of the cost savings of enforcing a Unitary Patent over the

current framework. The legal and administrative fees will be considerably lowered by having a

single court system to transact with.67 Currently it would require a specialist in French patent

jurisprudence to enforce a French patent in France, and similarly for German, UK, or any EU

67 Jennifer Bailey and Thomas Prock, Will a Unitary patent cost less than European

patent?, Marks & Clerk (April 29, 2015), https://www.marks-clerk.com/Home/Knowledge-

News/Articles/Cost-of-a-Unitary-patent.aspx#.XGGg11VKhEZ.

24

nation for that matter.68 Complexity such as this will inevitably equate to a significant cost burden

to those who have to parse through it.69 Complexity such as this, is what the Unitary Patent aims

to cut through, by having a single patent office to prosecute through, a single set of renewal fees,

and a single jurisprudence to stay knowledgeable about.

Time to Grant

An important consideration that potential patentees must also take into their calculus is

how long they are willing to wait before a patent is granted. Since the Unitary Patent will only be

able to be granted through the EPO there will be no alternative to speed up the process.70 The EPO

does not publish its own estimation for time from initiation of prosecution proceedings to grant of

68 Gerard Dossmann and Marianne Gabriel, Patent enforcement through the courts in

France, Lexology (Jan. 22, 2019), https://www.lexology.com/library/detail.aspx?g=f07fb07a-

6041-4e15-8b1c-74f44be59556.

69 See generally, e.g., Ryan Whalen, Complex Innovation and the Patent Office, Chi.-

Kent J. of Intell. Prop. Vol. 17, Issue 1 (Jan. 18, 2018),

https://scholarship.kentlaw.iit.edu/cgi/viewcontent.cgi?article=1193&context=ckjip.

70 Regulation 1257/2012 of the European Parliament and of the Council of 17 Dec. 2012,

O.J. (L. 361/1).

25

the patent. Nonetheless, the prevailing estimate is approximately 3 years from the time the

proceedings begin to the time a European patent is issued.71

To combat this, many Member States, such as France72, the UK73, and Germany74 have

taken it upon themselves to offer some form of accelerated patent prosecution process to entice

potential patentees to go directly through the Member State’s office as opposed to the EPO.

Programs such as this can add a substantial value to a potential patentee looking to push his product

to market quickly.75 The flip side to this is that there are patentees whose primary concern is the

71 Withers & Rogers, European Patent Application timeline, (2010),

https://www.withersrogers.com/wp-

content/uploads/2015/03/european_patent_application_timeline_2010.pdf.

72 Institute of Intellectual Property, Accelerated Patent Grant, (France)

https://www.inpi.fr/fr/services-et-prestations/delivrance-acceleree-de-brevet

73 Intellectual Property Office, Patents: accelerated processing, (Last updated Aug. 1,

2018) (United Kingdom), https://www.gov.uk/guidance/patents-accelerated-processing.

74 German Patent and Trade Mark Office, Patent Prosecution Highway, (Germany) (Last

updated Oct. 23, 2018),

https://www.dpma.de/english/patents/protection_outside_germany/pph/index.html.

75 See generally, Mewburn Ellis, European Patents – The Basics, (2010),

https://mewburn.com/resource/european-patents-the-basics/

26

end date to the patent as opposed to the beginning date, such as those patentees in the

pharmaceutical industry.76 These patentees see more value in the end date of their patent,

preventing generic reproductions of their drug, so that they can enjoy a competition free market

for their goods for as long as possible. These patentees have a history of opting for slower

prosecution strategies, in hopes of artificially pushing out the expiration date of their patent.77

Structure and Jurisdiction of the Unified Patent Court

A point that patentees will have to take in to consideration when deciding to opt for a

Unitary Patent or a bundle of national patents will be the selection of courts that will be available

to them. The UPC will have exclusive jurisdiction over the Unitary Patent, which will be created

4 months after Germany ratifies the UPCA.78

The UPC will be a completely new court that will have to carve out how it will handle

different types of claims since it will not have any established case law to determine how the court

76 Matthew Herper, Solving the Drug Patent Problem, Forbes (May 2, 2002),

https://www.forbes.com/2002/05/02/0502patents.html#43e5d06117bc.

77 Shai Jalfin, IP Strategy is a Tricky Balancing Act for Pharmaceuticals, IP Watchdog

(Aug. 26, 2017), http://www.ipwatchdog.com/2017/08/26/ip-strategy-tricky-balancing-

pharmaceuticals/id=86948/.

78 See UPCA supra note 2 and Regulation 1257/2012 of the European Parliament and of

the Council of 17 Dec. 2012, O.J. (L. 361/1).

27

will rule in any particular circumstance.79 The UPC will have a unique structure and jurisdiction

to its operation, which is crucial to understanding the pros of the UPC along with its’ inherent

cons.

Structure of the UPC

The UPC will be structured so that the law of the Unitary Patent develops in a coherent

manner.80 Certain categories of patent claims will be relegated to more technically specialized

courts, all funneled into a single Court of Appeal to ensure equal application of the law.81 The

UPC’s Courts of First Instance will be bifurcated into a “Local or Regional Division” that will

handle predominantly infringement claims, and a Central Division seated in Paris with sub-

divisions in Munich and London that will handle original revocation claims.82 This does come with

a certain level of comfort since the Central Division courts will be paneled so that there is at least

79 See Kevin White, One Patent (and Court) to Rule Them All: An Unexpected European

Decision, 25 No. 3 Intell. Prop. and Tech. L.J. 24 (2013).

80 Dr. Sabine Boos, What is the Structure of the UPC?, Hogan Lovells L.L.P. (last visited

Oct. 19, 2018),

http://www.theunitarypatent.com/what_is_the_structure_of_the_unified_patent_court.

81 Id.

82 Id.

28

one judge on the panel that will be somewhat familiar with the underlying technology.83 The

Central Division’s courts will be further segregated by their expertise in associated technology

disciplines, with the London court handling life science and chemistry based patents, the Munich

court handling mechanical engineering based patents, and the Paris court will handle all electronic

based patents.84 The courts of the Central Division will be a panel of 3 judges with at least one of

them being qualified on a technical level for the type of technology that the court’s expertise is

in.85 The courts of the Local or Regional Division will be paneled with a minimum of 3 judges,

but unlike the Central Division, none of the 3 judges will have to be technically qualified, except

by the request of the parties or the Court’s own initiative.86

Member States will have a lot of discretion on if they will set up a local division for

themselves or agree with neighboring Member States to co-fund a Regional Division.87 A Member

State will be limited ot a maximum of 4 Local Divisions within their territorial boundaries, and a

83 Paul Roscoe, Unpacking the EU Patent Package: The Unified Patent Court, Finnegan

L.L.P. (April 5, 2016), https://www.finnegan.com/en/insights/blogs/european-ip-blog/unpacking-

the-eu-patent-package-the-unified-patent-court.html.

84 Id. and Boos, supra note 80.

85 UPCA, supra note 2, at art. 8.

86 Id.

87 Plesner, supra note 39.

29

Local Division must hear at least 100 cases a year to justify the addition of another Local

Division.88 As of the writing of this piece, only the Baltic nations and Sweden have agreed to set

up a Regional Division.89 A Member State is not required to set up it’s own Local Division or

agree to cooperate with a Regional Division, with those cases being defaulted to one of the Central

Division court’s.90 To further illustrate the layout of the current makeup of Local and Regional

Divisions, Figure 4 below outlines which countries have set up a Local Division & which are in a

Regional Division.91

88 Id.

89 Id.

90 Id.

91 Id.

30

Figure 4: Figure depicting the distribution of Local and Regional Divisions.

Much like the United States, the UPC will have a single Court of Appeal, with its’ seat in

Luxembourg, that will handle all appeals from the courts of first instance to guarantee a coherent

development of case law which the UPC can build on and grow from. 92 The Court of Appeal will

be paneled differently from the Courts of First Instance, by having 5 total judges, with at least 2

of them being technically qualified.93 To aid in visualizing the totality of the UPC’s structure, a

92 UPCA, supra note 2, at art. 9.

93 Id.

31

representation is provided in Figure 5 to show how each Court will be paneled and how they will

relate to one another.94

Figure 5: General structure of the UPC's courts and their respective judicial panels.

Jurisdiction of the UPC

Generally, the UPC will only have exclusive jurisdiction over any patent issued from the

EPO, while Member States will maintain exclusive jurisdiction over their nationally issued

patents.95 This would indicate that as soon as the UPC comes into effect, that current European

94 Boos, supra note 80.

95 Regulation 1257/2012 of the European Parliament and of the Council of 17 Dec. 2012,

O.J. art. 18 (L. 361/1) and Regulation (EU) No 1215/2012 of the European Parliament and of the

32

Patents that have been issued from the EPO can only be litigated in front of the UPC. However,

there is an option for current patentees to opt-out of the jurisdiction of the UPC for a period of 7

years.96 This opt-out is only available up until an action is brought before either the UPC or a

national court of a Member State.97 Once this happens, that particular patent is locked into that

court system.98 This presents a peculiar problem for entities that predominantly license their

technology, now they’ll have to control their licensee’s to ensure that one of them does not file

suit in a court system that the licensor does not approve of, or without the licensor’s knowledge.99

Within the UPC’s jurisdiction, the Courts of First Instance will have bifurcated

jurisdictions between the Local or Regional Division and the Central Division.100 The Local or

Regional Division will be responsible for handling the predominant number of original

Council of 12 Dec. 2012 on jurisdiction and the recognition and enforcement of judgments in

civil and commercial matters O.J. art. 24 (L 351).

96 UPCA, supra note 2, at art. 83.

97 Id.

98 Peter Chrocziel, Review your license agreements for the Unitary Patent system, Kluwer

Patent Blog (June 13, 2016), http://patentblog.kluweriplaw.com/2016/06/13/preparing-for-the-

unitary-patent-system-reviewing-licensing-agreements/.

99 Id.

100 UPCA, supra note 2, art. 33.

33

infringement claims that come before the court.101 The Central Division is intended to be a court

that will be specialized in the technologies that are at work and thus will be tasked with all original

claims of revocation of Unitary Patents and European Patents.102 To best represent the jurisdictions

of the Courts of First Instance, Figure 6 has been reproduced to show a concise depiction of

complicated bifurcation.

Figure 6: Visual representation of the bifurcated jurisdiction of the UPC’s Courts of First

Instance.103

101 Id.

102 White, supra note 79.

103 Boos, supra note 80.

34

Advantages and Disadvantages of the Unified Patent Court

Forum Shopping

During the initial years of the UPC there will literally be no case law for which patentees

can rely on to predict how the court will hold in any particular situation or set of facts.104 For

patentees who may be looking to obtain the benefits of the Unitary Patent, this is certainly

something that will give them pause.

For patentees holding a Unitary Patent there is no other option, they will have to go through

the UPC.105 However, for patentees holding a European patent, they may opt out of the jurisdiction

of the UPC.106 The ability for patentees to opt-out of the UPC’s jurisdiction with the ability to opt-

in at any time does rightly stoke fears that forum shopping will quickly become rampant.107 To

lessen the effect this will have on forum shopping, once a patent is brought before either a UPC

104 Jason E. Stach and Laythem A. Wall, A Game Changer in Europe: The Unified Patent

Court, Finnegan L.L.P. (January 2018), https://www.finnegan.com/en/insights/a-game-changer-

in-europe-the-unified-patent-court.html.

105 Regulation (EU) No 1215/2012 of the European Parliament and of the Council of 12

Dec. 2012 on jurisdiction and the recognition and enforcement of judgments in civil and

commercial matters O.J. art. 24 (L 351).

106 Id.

107 White, supra note 79.

35

Division or a national court of a Member State, that patent is locked in to that court system.108 A

patentee will not be able to sue for infringement in a French court one year then the next sue for

an injunction in any UPC division for that patent.109

The fear of forum shopping is not just real, it is baked in to the structure and jurisdiction

of the UPC.110 Since the patentee can essentially choose which local or regional division with small

procedural hurdles, there is a real concern that patentees will find the most pro-patentee court and

direct of all their litigation to that court.111 This fear is somewhat mitigated by the fact that the

UPC will have a single Court of Appeals in Luxembourg to set the law for all Courts of First

Instance.112

108 Id.

109 See Regulation (EU) No 1215/2012 of the European Parliament and of the Council of

12 Dec. 2012 on jurisdiction and the recognition and enforcement of judgments in civil and

commercial matters O.J. art. 24 (L 351).

110 Peter Callens, Basics of the Unitary Patent system. Part 7: Forum shopping and

bifurcation fear, Kluwer Patent Blog (April 12, 2016),

http://patentblog.kluweriplaw.com/2016/04/12/basics-of-the-unitary-patent-system-part-7-forum-

shopping-and-bifurcation-fear/.

111 See generally Id.

112 UPCA, supra note 2, art. 9.

36

However, this point is something that the US courts had struggled with for years and has

only recently appeared to deal with in any real manner.113 This may be troubling for those in the

EU seeing as the fix that the US Supreme Courts had for its patent forum shopping, restricting

infringement suits to be filed in the state of incorporation of the accused infringer, will not be so

easy to bring to the UPC and the European landscape.114 This is directly the fault of the

foundational differences between US and UPC’s jurisdictional boundaries.115 In the US,

jurisdiction patent infringement cases were developed off of the common law concept of personal

113 Paul J. Cronin, U.S. Supreme Court Halts Forum Shopping In Patent Infringement

Cases, Nutter McClennan and Fish LLP (May 23, 2017), https://www.nutter.com/ip-law-

bulletin/u-s-supreme-court-halts-forum-shopping.

114 See Id. and Amandine Leonard, Forum shopping at the Unified Patent Court –

reflections post TC Heartland, KU Leuven Centre for IT and IP Law (August 3, 2017),

https://www.law.kuleuven.be/citip/blog/forum-shopping-at-the-unified-patent-court-reflections-

post-tc-heartland/.

115 Amandine Leonard, Forum shopping at the Unified Patent Court – reflections post TC

Heartland, KU Leuven Centre for IT and IP Law (August 3, 2017),

https://www.law.kuleuven.be/citip/blog/forum-shopping-at-the-unified-patent-court-reflections-

post-tc-heartland/.

37

jurisdiction.116 Up until the very recently, an infringement suit could be brought in any court that

could exercise personal jurisdiction over the accused infringer.117 In the UPC however, the

jurisdiction of the courts are spelled out statutorily in the UPCA specifically.118 The disadvantage

here is that the explicit enumeration of jurisdiction for the UPC leaves the UPC itself not much

wiggle room to deal with the forum shopping on its’ own.119 The ability to easily forum shop will

unfortunately likely lead to the EU becoming a haven for plaintiffs that buy up patents for the sole

purpose of suing infringers, commonly known as “Non-practicing entities” (“NPE”) or “patent

trolls”.120

116 See generally Robert Schaffer and Joseph Robinson, Specific Personal Jurisdiction

Requires ‘Substantial’ not ‘Attenuated’ Forum Contacts, IP Watchdog (June 23, 2017),

http://www.ipwatchdog.com/2017/06/23/specific-personal-jurisdiction-requires-substantial-not-

attenuated-forum-contacts/id=84992/.

117 See Leonard, supra note 115.

118 Id.

119 See Id.

120 Bart Jacobs PhD MSc, Software and IP: Patent trolls in the UPC landscape, Arnold

and Siedsma (March 7, 2017), https://www.arnold-siedsma.com/news/archief/2017/software-ip-

patent-trolls-in-the-upc-landscape.

38

Patent Troll Propagation

The nuisance of patent trolls is well known here in the United States, with many companies

going so far as to view their existence as a known cost of doing business, dubbing it the “NPE

tax”.121 Currently, the EU patent space has been for the most part spared by the headache that is

widespread patent trolls.122 This is in part thanks to the current fragmented nature of European

patents only enforceable in individual Member States, and in part to the industries where most

patent trolls operate in are not as prevalent in the EU.123 Many in the EU fear that with the onset

of the UPC and the Unitary Patent, bringing the EU patent landscape to closer resemble the US’s,

will also bring with it a tidal wave of patent trolls.124 This apprehension is based in the knowledge

that the prevalence of patent trolls will tamp down on innovation in general, with more inventors

121 Stephanie Fusco, Markets and Patent Enforcement: A Comparative Investigation of

Non-Practicing Entities in the United States and Europe, 20 Mich. Telecomm. & Tech. L. Rev.

439, 439 (2014).

122 Id.

123 See Kopelevich, supra note 43.

124 Id.

39

opting to keep their inventions as trade secrets.125 More trade secrets translates to fewer overall

inventions are being disclosed, and are not helping the next wave of innovation come forward.

More practically this puts a higher upfront cost to production for those companies that actually are

trying to practice their patents, a cost that will inevitably be passed on to the consumer.126 This

concern is based not only in to the high likelihood of forum shopping in the UPC, but also in the

wide discretion that individual UPC courts will have based on the UPCA.127 Two particular articles

of the UPCA have been pointed too as the most troubling for those who worry of an eventual rise

of patent trolls.

125 Dr. Roy Schestowitz, The European Patent Office is Attracting Patent Trolls,

Techrights (Nov. 18, 2018), http://techrights.org/2018/11/18/the-european-patent-office-is-

attracting-patent-trolls/.

126 Dugie Standeford, Companies Prefer Trade Secrets To Patents tTo Protect Innovation,

EUIPO Finds, Intell. Prop. Watch (July 27, 2017), http://www.ip-

watch.org/2017/07/27/companies-prefer-trade-secrets-patents-protect-innovation-euipo-finds/.

127 Kluwer Patent Blogger, Industry group: ‘Unified Patent Court hands patent trolls a

powerful weapon’, Kluwer Patent Blog (April 23, 2017),

http://patentblog.kluweriplaw.com/2017/04/23/industry-group-unified-patent-court-hands-patent-

trolls-a-powerful-weapon/.

40

The first troubling provision comes from Article 62(4) of the UPCA, which states in

relevant part

"The Court may… require the applicant to provide any reasonable

evidence in order to satisfy itself …that the applicant's right is being

infringed, or that such infringement is imminent.”128

The terms in this clause that give most patent watchers the most pause is the wide discretion

that the court is afforded with the inclusion of the words “may” and “any reasonable evidence”.

Practicing patentees might be fearful that different local or regional divisions of the UPC will set

the standard so low on what passes for “any reasonable evidence” that attaining a preliminary

injunction on an “imminent” infringement will put honest practicing patentees on the backfoot.129

Pushing them to settle the case early, quickly, and with more favorable terms given to the patent

troll. Proponents of the UPC will look to the same provision and state emphatically that this gives

the UPC’s judges discretion to weigh the equities between a practicing entity and a patent troll.130

This is a plausible outcome, but the same assurances cannot be made for permanent injunctions,

128 UPCA, supra note 2, at art. 62(4).

129 See Kopelevich, supra note 43.

130 Kluwer Patent Blogger, Industry group: ‘Unified Patent Court hands patent trolls a

powerful weapon’, Kluwer Patent Blog (April 23, 2017),

http://patentblog.kluweriplaw.com/2017/04/23/industry-group-unified-patent-court-hands-patent-

trolls-a-powerful-weapon/.

41

that are made in Article 63 of the UPCA, where there is not the same type of language that allows

for such discretion on the part of the sitting judge.131 It is one of the core tenets of statutory

interpretation to argue that if language is present in one place and absent in another that it was

done purposefully.132 For a patent troll to argue that language authorizing discretion is placed into

the article of the UPCA dealing with provisional injunctions, and then is absent from the

immediately proceeding article dealing with permanent injunctions, that the move was intentional

by the drafters.133

The other troubling provision comes from Article 33(3) of the UPCA, which allows for

any counterclaim for revocation, which would normally only be heard in the Central Division

courts, to be heard by the Local or Regional Division at that courts’ discretion.134 This provision

is very worrisome for patent practicing entities who fear that patent trolls will find a court that

rarely, if ever, will send a revocation counterclaim to the Central Division courts.135 Then the

patent trolls will concentrate their suits in those courts so that they can have the friendliest court

131 Id. and UPCA supra note 2, at art. 63.

132 Larry M. Eig, Statuory Interpretation: General Principles and Recent Trends,

Congressional Research Service (Sept. 24, 2014), https://fas.org/sgp/crs/misc/97-589.pdf.

133 Id.

134 UPCA, supra note 2, at art. 33(3).

135 See Kopelevich, supra note 43.

42

available to them, even if the practicing patentee attempts to counter to revoke their patent.136

Allowing the Local or Regional Division handle all the claims at once if the court, in its’ sole

discretion, feels it can adequately adjudicate it.137 This provision has given many in the EU patent

space pause, as this provision was originally written with the overall intent of making the process

more efficient.138

Speed of Litigation

One of the stated purposes of setting up the UPC was to expedite the litigation process and

to finalize infringement litigation within a year of the commencement of the suit.139 This will be

predominantly achieved by the bifurcated system of litigation that is imposed by the UPC’s Rules

of Procedure (“Rules”), from the written portion and the oral portion.140

136 Id.

137 Id.

138 See generally, Preamble(7), Rules of Procedure (“Rules”) of the Unified Patent Court,

EPO (2017) https://www.unified-patent-court.org/sites/default/files/UPC-Rules-of-

Procedure.pdf.

139 Id.

140 Callens, supra note 117.

43

The written portion will have strict deadlines imposed of a maximum of 3 months for a

defense to infringement and 2 months for a defense for revocation.141 The oral portion of the

arguments will be capped at 1 day, and the sitting judge is free to place further time limitations on

that at his discretion.142 Post both of these portions the judge may issue an opinion at any time

within 6 weeks.143 Compounding all of these factors, it is easy to see how even with reasonable

delays with scheduling that a case may be litigated within a calendar year. This will help keep

litigation costs down for both the parties as the UPC’s stated purpose will be to usher the cases

through quickly to their ultimate resolution.144 This speed will be imperative in the early years of

the UPC, to create the case law that will govern as Unitary Patent jurisprudence.

Selection of Judges

A vital metric that patent litigators will have to keep a watch for is the selection of judges

for the new UPC.145 Once the UPCA is ratified by Germany, the UPC will have just 8 months to

141 Rule 29, Rules of Procedure (“Rules”) of the Unified Patent Court, EPO (2017)

https://www.unified-patent-court.org/sites/default/files/UPC-Rules-of-Procedure.pdf.

142 Id. at Rule 113.

143 Id. at Rule 118(6).

144 Id. at Preamble(7).

145 Richard Willoughby, Unified Patent Court (UPC) judicial recruitment begins, D

Young and Co. (June 7, 2016), https://www.dyoung.com/en/knowledgebank/articles/upc-judges.

44

recruit, appoint, train, and fully staff up all of its courts with judges and support staff.146 This initial

staffing push will put a considerable strain on the UPC system as a whole, while also not allowing

for much time for judges to discuss their specific ideas on Unitary Patent jurisprudence.147

The advantage to this fresh system is that it will allow for judges to start fresh and anew

with their development of Unitary Patent law.148 Tackling the hardest issues first, such as forum

shopping and patent trolls, while relying on the breadth and depth of patent law that exists in the

world today to create a system that works well for patentees as well as fairly for accused

146 Kluwer Patent Blog, Plans for training of judges Unified Patent Court are ready,

Wolters Kluwer (February 15, 2018), http://patentblog.kluweriplaw.com/2018/02/15/plans-

training-judges-unified-patent-court-ready/.

147 Christopher Thornham and Roland Küppers, Judges in the Unified Patent Court,

Taylor Wessing L.L.P. (2014),

https://www.taylorwessing.com/fileadmin/files/docs/IPM_Feb14_UPCFeature.pdf.

148 Kluwer IP Blog, ‘Future judges of the Unified Patent Court will be very motivated to

make the court work’, Wolters Kluwer (September 14, 2017),

http://patentblog.kluweriplaw.com/2017/09/14/future-judges-unified-patent-court-will-

motivated-make-court-work/.

45

infringers.149 This optimistic view yet, may be too rosy in its outlook of how the new judges of the

UPC will take in their positions.

The disadvantage for this same point is that Unitary Patent law may be pushed through too

quickly and rapidly fragment, especially in the short and medium term.150 With each judge having

to rely on his or her personal background and experiences in their country’s patent system.151 This

can only exacerbate the coming issue of forum shopping that is bound destined to rear its head.152

This fragmentation would also lead to years of court battles with inconsistent rulings across the

EU.153 Putting the most pressure and onus on the appeals court in Luxembourg to not only hear

cases timely but to enforce their rulings in a consistent manner to tamp down any aggrieved forum

shopping and inconsistency in the law.154

149 Id.

150 See Kopelevich, supra note 43.

151 See generally Tilman Müller-Stoy and Florian Paschold, Unitary Patent and National

Law, 50 Les Nouvelles 57, 59 (2015).

152 Medina, supra note 32 at 321.

153 Allan Rosas, The National Judge As EU Judge; Some Constitutional Observations, 67

SMU L. Rev. 717 (2014).

154 Medina, supra note 32 at 321.

46

This judicial hiring blitz will also confront the UPC with a difficult problem that only hard

work can solve; finding qualified judges from countries not known for their stellar exemplary legal

apparatus or their bulk of patent litigation.155 These judges will require an extensive resume to be

considered qualified that includes being a national from one of the countries where the UPCA is

in effect, having extensive patent litigation experience in Europe, and must be fluent in at least one

EPO language with a preference for being multilingual.156 The UPC will have only 8 months to

recruit, train, and have some semblance of a cohesive judiciary while the provisional period is in

effect.157 This will include training on the rules of procedure for the court, how to actually use the

content management system for the UPC, and critical ethical training for the judges’.158 The one

advantage that the judges will have moving forward is that there shouldn’t be many infrastructure

155 See Willoughby, supra note 146 and Joff Wild, How do you teach experience? When

it comes to UPC judges Europe has to find a way, I-Am Media (October 16, 2014),

https://www.iam-media.com/law-policy/how-do-you-teach-experience-when-it-comes-upc-

judges-europe-has-find-way.

156 See Willoughby, supra note 146.

157 Kluwer Patent Blogger, Plans for training of judges Unified Patent Court are ready,

Kluwer Patent Blog (Feb. 15, 2018), http://patentblog.kluweriplaw.com/2018/02/15/plans-

training-judges-unified-patent-court-ready/.

158 Id.

47

delays for them to worry about.159 Given the delay from the initial signing of the UPCA in early

2013, the UPC Preparatory Committee has had ample time to consider and plan for the start of the

UPC.160 The UPC Preparatory Committee has signaled that when and if a positive outcome comes

from the German Constitutional Court, that the UPC will have the underlying IT and logistical

issues sorted out.161

159 Alan Johnsons, The Unified Patent Court: all dressed up but no place to go?, Kluwer

Patent Blog (Jan. 18, 2019), http://patentblog.kluweriplaw.com/2019/01/18/the-unified-patent-

court-all-dressed-up-but-no-place-to-go/.

160 Id.

161 Unified Patent Court, Status of Unified Patent Court Project – 19 December 2018, (Dec.

19,2018), https://www.unified-patent-court.org/news/status-unified-patent-court-project-19-

december-2018.

48

Figure 7: Figure depicting where all major UPC infrastructure is in place.162

Brexit Impacts

The EU in particular is in a precarious position when it comes to the potential impacts of

Brexit. In the UPCA, the UK was named as one of the 3 nations that had to ratify the UPCA for it

162 Plesner Advokatpartnerselskab, Map of UPC Countries, last visited Feb. 11, 2019,

https://www.plesner.com/speciale/upc/upc-kort?sc_lang=en.

49

to come into full effect.163 Now, the UK has already ratified the UPCA but will likely leave the

EU before the Unitary Patent and the UPC will be in place and have legal effect.164 The EU will

have to grapple with the fact that a central party to the base UPCA will no longer even be an EU

Member State.

A central tenant of the Unitary Patent System is that there will be consistency with the

Unitary Patent’s new and developing law.165 Brexit leaves one of the three Central Division Courts

in a country that isn’t under the EU’s direct jurisdiction.166 These are problems that the EU will

have to grapple with in deciding to honor the ratification of the UPCA from the UK and allow

163 Paul Reeskamp, Is the UPC Brexit-Proof?, DLA Piper (June 30, 2016),

https://www.dlapiper.com/en/us/insights/publications/2016/06/is-the-upc-brexit-proof/.

164 Green, supra note 21.

165 See generally, Preamble(5), Rules of Procedure (“Rules”) of the Unified Patent Court,

EPO (2017) https://www.unified-patent-court.org/sites/default/files/UPC-Rules-of-

Procedure.pdf.

166 Laura Ercoli, Milan bids to host London’s Central division of the Unified Patent Court,

Società Italiana Brevetti S.p.A. (Dec. 17, 2018), http://www.sib.it/en/flash-news/italiano-milan-

bids-to-take-over-londons-central-division-of-the-unified-patent-court/.

50

them access to the system.167 The alternative for the EU will be to force the UK out of the Unitary

Patent System altogether once their departure from the EU becomes official.168

The UK on the flip side is in an equally precarious spot, where a central idea of Brexit was

to rid itself of EU law and now.169 The UK government is now in the position of actively wanting

to maintain this aspect of EU law.170 Selling this idea to a public that is sharply divided in multiple

167 See David Holland, The UK government has published additional information about

how the UK might participate in the Unified Patent Court after Brexit, Carpmaels and Ransford

(August 24, 2018), https://www.carpmaels.com/news-on-the-uks-involvement-in-the-upc-after-

brexit/.

168 Dr. Winfried Tilmann, The Future of the UPC After Brexit, Hogan Lovells International

LLP (Last visited January 13, 2019), http://www.theunitarypatent.com/the-unitary-patent-

regulation-and-upc-agreement-after-brexit.

169 Alexander Robinson, UK Confirms Intention To Remain In Unitary Patent System After

Brexit, Dehns (July 17, 2018),

http://www.mondaq.com/uk/x/719880/Patent/UK+Confirms+Intention+To+Remain+In+Unitary

+Patent+System+After+Brexit.

170 Id.

51

ways on Brexit will be daunting under even the best circumstances.171 However, patent rights are

not generally what the average Brexiteer thinks about during the normal discussions about Brexit

and the reasons for it.172 It is likely that Unitary Patent System will be so far under the public radar

that the UK government will be able to negotiate to stay in fully and fully cooperate with the EU

on its regulations of the Unitary Patent System.173

Nonetheless, the ultimate question that remains unresolved is whether the EU will allow

the UK to stay within the Unitary Patent System, and if it does, what restrictions will be placed on

the UK.174 The EU for their side will likely not want to further complicate and delay the enaction

171 See generally, Rachel Sylvester, Brexit divisions are getting bigger, not Smaller, The

Times (Sept. 3, 2018), https://www.thetimes.co.uk/article/brexit-divisions-are-getting-bigger-

not-smaller-nrxktsmlp.

172 From forum-shopping to the UPC: 10 IP issues to watch in 2017, World IP Review

(February 16, 2017), https://www.worldipreview.com/article/from-forum-shopping-to-the-upc-

10-ip-issues-to-watch-in-2017.

173 Id.

174 See generally, Kluwer IP Blog, ‘Future judges of the Unified Patent Court will be very

motivated to make the court work’, Wolters Kluwer (September 14, 2017),

http://patentblog.kluweriplaw.com/2017/09/14/future-judges-unified-patent-court-will-

motivated-make-court-work/.

52

of the Unitary Patent System, so will likely be very amenable to an arrangement that will allow

the UK to enter the Unitary Patent System.175 This would expedite the enaction of the Unitary

Patent System as much as possible, as opposed to putting off the system for another couple years

of negotiations.176 The prevailing opinion currently is that the EU will likely allow the UK to

remain in the Unitary Patent System but not allow UK nationals to serve in any capacity as a judge

in the UPC.177 All that the EU is currently waiting on is for Germany to fully ratify the UPCA for

the clock to start ticking to take full effect.178

These coupled interests will likely lead to the ultimate decision from the EU to allow for

the UK to stay within the framework so long as the UK abides by the UPCA, regulations of the

175 Peter-Ulrich Plesner and Sture Rygaard, Brexit: Can the UK join the Unified Patent

Court in the future?, Plesner (Sept. 20, 2016) (Translated Feb. 11, 2019),

https://www.plesner.com/insights/artikler/2016/09/brexit-kan-storbritannien-vaere-med-i-den-

faelles-patentdomstol-fremover?sc_lang=da-dk.

176 See generally, Alexandra George, Restructuring Intellectual Property Jurisdiction Post-

Brexit: Strategic Considerations for the European Union and Britain, 43 Brook. J. Int'l L. 131,

135 (2017).

177 Merpel, Does the UPC spell disaster for the EPO Boards of Appeal? IP Kat (May 12,

2016), http://ipkitten.blogspot.com/2016/05/does-upc-spell-disaster-for-epo-boards.html.

178 McCarthy, supra note 27.

53

EPO, and future EU regulations concerning the Unitary Patent System in the future.179 This will

allow for a smooth transition to a functioning Unitary Patent System, which is what the EU wants,

and it won’t further complicate the Brexit negotiations for the UK, which is something the UK

desperately wants to further avoid a “no deal Brexit”.180

Conclusion

The Unitary Patent and the UPC will be a seismic shift in the way patent law is prosecuted

and litigated in the European Union. Each patentee will have to consult with an informed patent

professional and take a measured approaching in deciding which path they will take when seeking

patent protection in Europe for the foreseeable future. These decisions will be intensely personal

and specific to each different situation, since each of the different factors discussed here will

varying degrees of impact on each individual patentee. Patentees will not only have to grapple

with the coming changes, but how their existing patent portfolio is structured. If a patentee has

built his portfolio out of direct patents from Member State’s offices, he may be unwilling or

hesitant to shift some over to a Unitary Patent. For some, the economics of pan-European

protection will outweigh the risk of having to possibly pay an NPE tax in the future. For deeper

179 See generally, George, supra note 178.

180 See generally, Id. and Declaration & Reservations of the U.K. to the UPC Agreement

(April 26, 2018), http://www.consilium.europa.eu/en/documents-publications/treaties-

agreements/ratification/?id=2013001&partyid=GB&doclanguage=en.

54

pocketed patentees, holding multiple national patents across the EU, forcing competitors to

challenge them in multiple court systems, or forego litigation altogether may be advantageous.

Overall I believe that for the majority of patentees, the advantages of the Unitary Patent

and the UPC will outweigh the disadvantages of the System. The relatively low overall cost of

obtaining a Unitary Patent contrasted to the benefit of near continent-wide protection is

undeniable. Add to it a single court system that you would have to litigate in front of with a single

set of procedural rules and case law to stay up to date on. This all translates to a simpler and more

transparent legal framework for patentees to operate in. Patent trolls will become more of a

nuisance, but the UPC and the various branches of the EU can handle that problem as it shows its’

head.

For the short term the Unitary Patent System will likely cause more confusion and worry

in the European patent space than originally intended. However, over the long run the Unitary

Patent will aid the EU in attracting fresh innovation and businesses to conduct more business there.

As with seemingly everything the EU does, there will be no “one size fits all” and each patentee

will have to weigh the advantages and disadvantages for themselves to decide how to best protect

their intellectual property.