During these sessions we have been asked many thought-provoking questions on the UP/UPC. Emily Collins and Tom Hamer of our San Francisco Liaison office recently put some of those questions to two of our resident UPC experts: Nick Bassil and Duncan Bull.
Is it possible to request unitary effect (obtain a UP) for a parent case, then file a divisional with similar claims and then validate that divisional separately in individual European countries?
Tom: I think the answer is yes, and I can see why an applicant might want to do that. First of all, we should consider whether the EPO would grant a parent and a divisional with “similar claims”. The EPO approach to double-patenting is essentially that the subject-matter of the claims of any two commonly-owned patents should not be “identical”.
Nick: Yes, the EPO approach to double-patenting is the result of there being no statutory prohibition, so the EPO’s current practice is dependent on case law and practice. However, it is completely acceptable to obtain granted claims within the same patent family which may look very similar, but which are in fact patentably distinct with respect to at least one technical feature and therefore merely “partially overlapping” (or which contain claims of a different claim category, i.e. product, method, use etc.). In my experience it is reasonably common practice at the EPO to obtain multiple EP patents in the same family with such partially overlapping claims in this way.
Tom: So, taking the filing route suggested in this question, the result could be a Unitary Patent covering the participating EU countries, and a divisional with similar claims to the parent validated in the applicant’s chosen countries, e.g. Germany, France, and the Netherlands. This bundle of national patents validated in the traditional way could then be opted out of the UPC.
Emily: I can see why this would be attractive, because if the parent case is revoked centrally at the UPC, then the applicant would still be left with the bundle of traditionally validated national patents. But is this actually a good idea? Is it possible that a UPC judge could find a UP invalid, while a German judge applying German national law could interpret the claims and prior art differently and find the same (or a very similar) patent claim to be valid?
Nick: Not sure – but if the claims between the UP and national validation of the divisional are drawn to different inventions, then there is no “same” patent at issue. What the UPC might have to do is rule on the same prior use allegation, or same point on enabling disclosure, reasonable expectation of success etc.
Duncan: I think the answer to the question is yes, provided the claims are sufficiently different to be granted by the EPO in the first place. If the EPO is willing to grant highly similar claims, I don’t think there should be anything stopping an applicant from validating a case in a patent family nationally in addition to getting a UP for similar claims in the same patent family. It’s no worse than a lot of patent thickets that exist already, you’re just mixing up the forum that opponents or third parties have to use to take them out.
Tom: Ok, we agree the filing approach is valid. Would there be downsides to this approach?
Emily: It will be interesting to see what happens in practice, when national courts first start assessing national patents where there is a co-existing UP in the family, albeit with different claims. Of course, choosing this route would incur UPC and national validation costs on top of the cost of filing and prosecuting two applications.
To what extent will the new court be applying EPO law?
Emily: Well, by EPO law I assume we mean the European Patent Convention (EPC), in addition to EPO case law built up by the EPO Boards of Appeal. As for whether the UPC will be applying EPO law, Article 24 of the UPC agreement says that the UPC will apply Union (EU) Law, the UPC Agreement (UPCA), the European Patent Convention (EPC), other international agreements applicable to patents and binding on all UPC contracting states, and then national law. My understanding is that this list is in order of precedence.
Nick: Note that Union law says nothing about patentability (except for some biotech inventions) and is silent mostly on other provisions relating to infringement (except enforcement and remedies), so that means the UPC will look to the UPC Agreement and the EPC. This means that the UPC will likely start from the basis of where the EPO has got to and then start to develop its own jurisprudence – but if the judges don’t like the EPO approach then in theory they are indeed free to do something else! I suspect that national law will be avoided unless it is really helpful to the reasoning in a decision.
Tom: But there’s no explicit mention of EPO case law in the UPC agreement, so in principle could we end up in a situation where the UPC is applying the EPC but in a different way than the EPO boards of appeal?
Nick: This happens already with national courts doing their own thing sometimes compared to the EPO and/or Boards of Appeal (BoA), but remember the judges in the UPC will be the same people more or less as the existing national judges and we know that there is a high level of judicial cooperation between the national courts and Board of Appeal at the EPO already in terms of trying to act in concert. The slight caveat is that the UPC will use panels of multinational judges composed of legally qualified judges and technically qualified judges, so this will likely resemble an EPO Board of Appeal in practice.
Duncan: I’d be surprised if the UPC diverged significantly from the approach taken by the Boards of Appeal and, given the estimated timelines, it is likely that UPC actions would be over a lot quicker than inter partes Board of Appeal proceedings. Therefore, the UPC might be the first to rule on a particular fact pattern in any given case and then would the Board of Appeal “defer” (even though they’re not obliged to) to the UPC’s decision. That is currently an open question. It would be strange (although hypothetically possible) if the UPC invalidated a UP and then the Board of Appeal upheld the underlying European patent (and therefore any non-UP validations) based on the same facts.
Will forum shopping exist in the UPC?
Tom: As an opening comment, I think it’s fair to say that the patent litigation landscape in Europe at the moment is complicated, and each national court system has its own quirks and features to be aware of. One of the aims of the UPC is to create a single court system where each of the Divisions uses the same procedures. In principle, all branches of the UPC should be applying the same law. But that being said, forum shopping is likely to exist…
Emily: Although the UPC is intended to be a single court system, each division will have its own judges. Claimants and defendants therefore may have a preference for which division hears their case. Further, it may not always be immediately obvious which is the correct division to hear the proceedings. For example, according to the Article 33 of the UPC agreement, infringement proceedings will be held at “the local division hosted by the Contracting Member State where the defendant or, in the case of multiple defendants, one of the defendants has its residence, or principal place of business, or in the absence of residence or principal place of business, its place of business, or the regional division in which that Contracting Member State participates.”
Nick: The answer to the question is: yes of course, the UPC will be all about forum shopping! Where the act of infringement is located and/or where the appropriate place of business is located is going to be a hot topic I think. Parties seeking a preliminary injunction, for example, will look to find the division that suits them best – which could also be a straight fight between getting an action going in a local division or the Central Division. Remember also that the national courts are still a “forum” so we can expect lots of disputes about whether there is or is not pre-existing national action co-pending which could prevent a UPC action.
Duncan: I think there will be quite a lot of forum shopping, particularly in the early days where parties may want to create uncertainty by using less predictable local divisions. There will also be an incentive for local divisions to hold onto more cases rather than handing them over to the central divisions, so some divisions may end up with slight biases or faster/slower timelines which may influence the choice of forum (to the extent that there is a choice available to each party). Also, I expect there will be a lot of early arguments on whether opt-outs were legitimate or not and therefore whether co-pending national court actions can be brought or not.
Tom: And will we see certain divisions of the UPC actively seeking more cases? I have Judge Albright in the Western District of Texas in mind here…
Nick: It is technically possible that some of the divisions might want to “encourage” customers by, for example, agreeing to speedy preliminary injunctions. The UPC is self-financing so local divisions are pitching for work, which is why so many have opted for English as a possible language of proceedings.
Tom: So, is forum shopping going to be more, or less, of a factor compared to the current litigation landscape?
Nick: I think the UPC will make forum shopping even more of an issue – now you have UPC vs. national courts: if the UPC, which UPC local/regional or central division? If a national court, which national court?
Duncan: I agree with Nick, I think it could be hectic in the early days as there will be even more alternatives and options for creating uncertainty with opponent’s patents by trying to pin things in or out of the UPC depending on the opt-out status of the patent.
Will the local Division of the UPC in Italy be applying Italian national law, and the local Division(s) of the UPC in Germany be applying German national law, etc?
Emily: I think the answer to this question at a high level is “no”. The UPC will indeed have different divisions throughout Europe, with a central division in Paris and Munich (and perhaps one other place), and multiple local / regional divisions. Each branch of the UPC will be applying the same law, based on Union Law, the UPC Agreement, the EPC, international agreements, and national law.
Nick: I agree. However, there may be a local “flavour” at different divisions. The Courts of First Instance will be presided over by panels of judges, and Article 8 UPCA sets out how the composition of these panels will be determined. The rules should introduce a more balanced outlook, so for example for the “weaker” divisions, where there is less local national litigation, there will be 2 panel members from outside the country of that division. So, anything that requires judicial discretion at the UPC, like a preliminary injunction, could still follow national practice to an extent. This is a big unknown! For example, will German preliminary injunction practice spread around Europe at the UPC, or will it be diluted?
I don’t understand the pros of keeping your traditional, already granted EP patents opted in to the UPC jurisdiction? Why would anyone risk their EP patents being revoked across all of Europe by an untried, untested court?
Emily: First, it’s true that there are downsides to keeping your traditional EP patents in the jurisdiction of the UPC, i.e. of not opting out. For example, by keeping your traditional EP patents in the jurisdiction of the UPC, you run the risk of having all your validations for a particular granted EP patent, in other words the entire bundle of individual national patents, revoked in a single decision at the UPC.
Tom: A potential benefit of remaining opted in would be if you wanted to use the UPC for multi-jurisdictional enforcement. For example, imagine you had a patent family granted and validated in, e.g., FR, DE, NL, IT. If you do not opt out these patents from the jurisdiction of the UPC, then (depending on the scenario) you would then have the option of bringing an action against an infringer either in the UPC or in any one of these national courts. The UPC might be attractive for central enforcement; a single decision made at the UPC would potentially be applicable (again, depending on the scenario) in all of FR, DE, NL, and IT.
Duncan: I agree and I think it’s worth highlighting that, by keeping your patents in the jurisdiction of the UPC, applicants can avoid national procedures such as bifurcation in Germany. You also get the benefit of a consistent timeline etc. (which may be an advantage or a disadvantage depending on the situation).
Nick: I agree. By the way, there is often some terminology to clear up here. Taking the action to “opt-in” a patent will be relatively rare. Traditional EP patents fall under the jurisdiction of the UPC by default unless they are “opted out”. After a patent has been “opted out”, it’s only then possible to actively “opt in”, i.e. opt back in. The simple answer is that the advertised benefit of the UPC is a dual cost and time saving in terms of only needing to litigate a patent once in Europe to get a decision that is enforceable in all UPC states. Of course, it’s still unclear if that will be the result in practice…
The views expressed here are informal and may not necessarily reflect the position of Kilburn & Strode. This article is intended to be correct as of the date of this conversation, 15 March 2022, but the content cannot be guaranteed to be correct and complete. Please contact any of Nick, Emily, Tom or Duncan or your usual Kilburn & Strode advisor for more information.
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