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Unified Patent Court – The Italian Job

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EU flagAs we previously reported (here), Italy signed the unified patent court (UPC) agreement on 19 February 2013. This means that there are 25 countries (out of a possible 28) who are signed up to the UPC agreement (Spain, Poland and Croatia have not currently signed).

Italy, of course, is not part of the enhanced cooperation regulations that the unitary patent itself will be delivered under. If Italy, along with the other required countries, end up ratifying the UPC agreement and the unitary patent package comes into effect, Italy will be part of the court system but unitary patents will not have effect in Italy.

That couldn’t possibly cause any issues, could it?

According to Article 3(2) of the unitary patent regulation 1257/2012 (here) :

A European patent with unitary effect shall have a unitary character. It shall provide uniform protection and shall have equal effect in all the participating Member States.

It may only be limited, transferred or revoked, or lapse, in respect of all the participating Member States.

Article 34 of the unified patent court agreement states:

Territorial scope of decisions
Decisions of the Court shall cover, in the case of a European patent, the territory of those Contracting Member States for which the European patent has effect.

These two clauses together confirm that if a patent grants as a unitary patent then it will stand or fall across the whole of the unitary patent area and if a patent grants in the traditional sense as a bundle of nationally validated EP patents then a decision of the unified patent court relating to one particular EP(national) patent will cover all the EP patents in the bundle.

In the case of a patent being revoked by the unified patent court, it won’t matter if it is a unitary patent or a “traditional” EP patent – the patent should fall in all territories that the court covers.

But what of Italy? Consider the following scenario.

  1. An EP patent grants and the patent owner selects a unitary patent and also decides to validate in some of the countries not covered by the unitary system (including Italy);
  2. An action, in respect of the unitary patent, is brought before the unified patent court;
  3. The defendant successfully pursues a validity attack against the patent;
  4. The unitary patent is revoked.

What happens, however, to the EP (IT) patent? It is not revoked by virtue of Article 3(2) of the regulation because Italy is not part of the enhanced cooperation regime. It is not apparently revoked by virtue of Article 34 of the UPC agreement because that article refers to a “European patent” and not a “European patent with unitary effect”.

So, it seems that the EP patent that was validated in Italy escapes the validity attack. Presumably, it could then be attacked via the UPC in the central division (actions in respect of validity can only be brought before the Central Division by virtue of Article 33(4) of the UPC) but it seems that a separate action is needed with all the associated costs and hassles.

The reverse scenario (unitary and EP(IT) and action brought before unified patent court in respect of the EP(IT) only) also appears to result in the same outcome.

However, if the patent owner doesn’t select a unitary patent in (1) above but instead validates in a number of EP countries only then it would seem that, by virtue of Article 34 of the UPC agreement, all the EP(national) patents that fall within the scope of the unified patent court will be revoked, including the Italian one.

Is this another quirk of the system? Or is there a way that the unified patent court can deal with both the unitary patent and the EP(IT) in the same action? We’d be interested in hearing your thoughts.

Mark Richardson     10 February 2014


23 Comments

  1. fish says:

    The fact that the patent has a unitary effect does not preclude the defendent to invalidate the patent in a single action in the “unitary territory” AND in Italia.
    The wording of Art.34 is indeed limited to European patent (i.e. with no unitary effect), but the purpose of Art 34 was to make clear that the principle that a decision of UPC covers the territory of the contracting member states also applies for European patent with no unitary effect. Art 34 should not be construed as applying exclusively for European patent.
    The mecanism of Art 34 applies for Italia, whatever the situation regarding the unitary effect.

    As an aside, the Art 33(4) use the words “same patent” (i.e. European patent and/or European patent with unitary effect). Hence I don’t think that Art 33(4) precludes the defendent to challenge the unitary EP + the Italian part of the EP in a single action.

  2. ipalchemist says:

    Thank you for raising this point Mark.

    I have wondered about precisely this issue, but not in relation to Italy specifically, but in relation (when Unitary effect is selected) to states generally that did not ratify at the time of grant of your European patent, so your patent is not Unitary in respect of those countries, but which did ratify before your infringement proceedings started, so in principle the UPC is competent with respect to those designations. Since ratification is expected to occur over time, even when Unitary effect is selected, in the early days it won’t be expected to cover all of the countries that intend in the end to participate.

    I have raised this at UPC events that I have attended but have not received a clear answer. So like the post author, I don’t know. I think that there is likewise a question as to whether the infringement claim at the UPC need include all designated states that are in the UPC at the time of proceedings, or whether the infringement claim at the UPC can be restricted to the Unitary part, allowing the other parts to be the subject of national proceedings. Opt-out is of course impossible.

  3. Russell Barton says:

    Without studying this in detail I suspect that, regardless of the exact words used, the spirit of the agreement and the recitals will mean that a UP and EP(IT) or other EP(ratified state) will always be heard together.

    Regarding the exact words, you could argue that its clear that as far as the UPCA is concerned the EPO only grant one patent at a time and that post validation there is still one patent. The definitions given in Art 2(e) and (f) appear to cover all situations for a patent granted under the provisions of the EPC, and be mutually exclusive. Consequently a patent granted by the EPO has to fall under one of these definitions and only one of these definitions . At face value an EP(IT) validated alongside a UP is part of a “European Patent with Unitary effect” albeit the unitary effect itself doesn’t cover Italy.

    From a brief overview it appears that that interpretation works with of the many articles of the regulation too as they limits the effect to “all the participating Member States” when defining anything new in regard to a “European Patent with Unitary effect” . One notable exception is Art 7 but I cant see any court interpreting Art 7 as affecting EP(IT)s regardless of the literal wording.

    Lastly thank you for drawing attention to Art 34, as its significance has passed me by. I had heard that the UPC could hear infringement on EP(ES) and EP (PL) (subject to Brussels and invalidity being raised etc) but Art 34 would seem to rule that out.

  4. fish says:

    1. What would be the situation if the Italian part is invalidated in view of an Italian prior right (Art.139(2)EPC) : does it impact the UP?

    2. And what if the UP should be invalidated in view of a DE prior right (Art.139 (2) EPC) : does it impact the Italian part of the EP?

    3. Same questions if the UP is a EP (i.e. with no unitary effect).

  5. Antonio Pizzoli says:

    @Fish:

    1. According to the Italian law (but I guess it is the same in all European States), an Italian prior right does not impact a UP, as long as the UP does not cover Italy.

    2. Again, a German prior right would invalidate a UP but would not invalidate an Italian portion of a European patent.

    3. Without any unitary effect a national prior right would only affect the corresponding national portion of a European patent.

    More in general, if the UPC declares a unitary or European patent invalid, I guess there would be anyway a kind of “butterfly effect” also in the non-UPC States, as it happens now when national portions of EPs are invalidated in 2/3 important States. Would you dare to enforce such a patent in the other States?

  6. fish says:

    Thank you Antonio.

    I agree with your last remark because you refer to non-UPC states (for which the situation is clear).

    For the rest, I am not sure to disagree with you, but I am not sure to agree either.

    Let’s consider a European patent validated in Germany and in UK. Let’s assume that there is national a prior right according to Art 139(2)EPC in Germany. Of course, the patentee did not opt out. Should we consider that the patent should be revoked in UK? One would tend to answer yes according to Art 34 UPCA. But I am not satisfied with that.

  7. Antonio Pizzoli says:

    Art. 34 UPCA defines the territorial scope of the decisions, not the applicable law (UPCA vs. EPC vs. national law), which is instead defined in Art. 24 UPCA.

    In your particular case the UPC will decide on both UK and DE portions: according to Art. 139(2) EPC the first will be considered valid by the UPC and the second will be revoked.

  8. Pandora says:

    I agree with Antonio, that should be the case. 34UPC determines the jurisdiction for EP, the regulations for the unitary patent, but that does’t means it’s a clean sweep: it is still possible, based on different national laws; or differences between the unitary patent law and Italian patent law, to establish facts for both cases equally, but to arrive at different conclusions based on the applicable law.

    What keeps puzzling me is another related territorial scope decision and I’d be interested if Mark could have a topic on that: what about Curacao, Sint Maarten, Caribbean Netherlands and Isle of Man? They are not in the EU, so the unitary patent regulation doesn’t apply to them (as EU regulations simply do not apply to them). The UPC does apply to them in regard of European Patents by virtue of 34UPC (the territory in the contracting state where the EP applies; maybe this is the very reason 34UPC was added). So if someone asks for unitary protection then
    i)the EP is not validated for Curacao etc (
    ii), but… (bit but) it might be possible that the UK and NL use their autonomy they still have in these regions to make it possible to apply for a EP (UK) or EP (NL) patent, even after a unitary patent is requested; which will only be validated for Curacao etc (EP (NL)) and/or Isle of Man (EP (UK)). In that case Curacao etc will be “a second Italy”; only slightly more complicated, as much of the EU law does not apply (e.g. the Brussels regulation). Weirdly the UK implementation law doesn’t mention any of this at all….

  9. Antonio Pizzoli says:

    Actually, there are many other puzzles in the system, e.g.:

    1. what if I opt-out a European application and then I request the unitary effect for the corresponding patent?
    2. vice versa, what if I request the unitary effect and then I opt-out the corresponding patent?
    3. what if I request the unitary effect for a European patent having different owners for different participating member states?

  10. fish says:

    Many thanks you for your comments Antonio & Pandora.

    Antonio:

    1. Interesting. I would say that automatically UPC will have exclusive jurisdiction, regardless the opt-out for the preexisting EP. Which brings me to the next question. What if I opt-out, then someone launches an invalidity action before a national court, and then I request Unitary effect?

    2.Opt out is only possible for EP.

    3. EPO is supposed to adopt implemtning regulations for Art 9 of Reg1257/2012. I guess (I hope) that they will adress this issue.

  11. Antonio Pizzoli says:

    Ok, I make it even more complicated:

    1. what if I opt-out and request the unitary effect on the same day?
    2. opt-out is possible for EPs, however unitary patents are EPs (Art. 83 UPCA and Rule 5 RoP do not explicitly exclude unitary patents).

    • ipcopymark says:

      Antonio

      Art 83 UPCA refers to “European patent” which is defined at the start of the Agreement as:

      ‘European patent’ means a patent granted under the provisions of the EPC, which does not benefit from
      unitary effect by virtue of Regulation (EU) No 1257/2012′

      So the transitional provisions do not cover unitary patents

  12. fish says:

    Antonio, you might be interested by Art 2, paragraphs e) and f) UPCA. ;-)

  13. ipalchemist says:

    I think that all the replies to Antonio are in agreement about the ultimate point, which is that a patent cannot be both opted out and benefiting from unitary effect at the same time. There is still however the question as to how this is to be implemented. If a European patent application is opted out and then a request for unitary effect is filed, what happens? There seem to be three possibilities.

    1) The request for Unitary effect is inadmissible and the European patent cannot become a Unitary patent. This is the approach that I favour.

    2) The opt-out is automatically withdrawn. I don’t think this is possible because it circumvents the formalities (and possible fee) of withdrawing an opt-out.

    3) You get an opted out unitary patent. I think we all agree this is impossible.

    I think that if the application is opted out, then the opt-out must be withdrawn before a valid request for unitary effect can be filed.

    Maybe this was already clear to everyone, but I thought it helpful to work through the options.

  14. Antonio Pizzoli says:

    Thank you for your responses but what would happen if I opt-outed a unitary patent anyway? Rule 5.5 RoP does not contemplate this situation. Moreover, what if opt-out and unitary request are filed on the same day?

  15. ipalchemist says:

    Antonio, if you file an opt-out request on a unitary patent, it is simply inadmissible, and your patent does not become opted out. I am quite confident this is how it will work out. If you do both the same day, then one of them will have to be ineffective. I am not confident about which one, but I think that the request for unitary effect may take precedence.

  16. fish says:

    I would tend to think that requesting unitary effect should prevail on the opt-out.

    It could be imagined that the fee for requesting unitary effect will be greater than the fee for withdrawing opt-out. and/or that the form for requesting unitary effect contains a statement according to which “the applicant hereby withdraws the opt out if applicable”.

  17. Antonio Pizzoli says:

    There will be no fee for requesting unitary effect (curious, isn’t? Look at the explanation). Here you can find the second draft rules for requesting the unitary effect:

    http://www.cmslegal.com/Hubbard.FileSystem/files/Publication/4a402486-c7f2-40f5-8841-00e61574156c/Presentation/PublicationAttachment/bf11e108-8645-45f0-bd24-07cf029f9ee1/esc1316-Revised-UP-RoP.pdf

    From the rules it is not clear how co-ownership will be regulated (page 9, par. 2): automatic or manual assignment?

    No indication on how to handle concurrent/colliding requests for opt-out and unitary effect.

  18. ipalchemist says:

    In response to Fish at 12.53, I think you are forgetting that (after any possible sunrise period) opt-out requests are filed at the Registry, while unitary effect is filed at the EPO. I don’t think you can get deemed, concomittant, or automatic withdrawal of opt out by requesting unitary effect.

    To Antonio, the rules indeed do not yet make clear how colliding or concurrent requests are to be handled. But the law does make clear that you cannot be both.

  19. Jonas says:

    Does this also mean that Art. 83(1) never applies to non-unitary parts of European patents with unitary effect? i.e. the competence is exclusive regarding these patents from day one. They are not “European Patents” in the meaning of this article?

  20. ipcopymark says:

    Hi Jonas

    Could you expand your question slightly and I’ll try and give an answer. What do you mean by non-unitary parts of EP patents with unitary effect?

    Regards

    Mark

  21. Jonas says:

    Hi Mark,
    Thank you for taking time and I apologize for being out of context.

    I was following the reasoning of Russell Barton 11 Feb: ‘At face value an EP(IT) validated alongside a UP is part of a “European Patent with Unitary effect” albeit the unitary effect itself doesn’t cover Italy’
    and also your reply: ipcopymark 13 Feb 11:09 AM ‘transitional provisions do not cover unitary patents’.

    Would this mean that EP that benefit from unitary effect, but at the same time is granted for other UPC states, e.g. Italy will not be covered by the transitional period to the effect that the Italian EP cannot be challenged in an Italian court. This would make sense if the definition of UP is indeed covering also non-UP UPC states (as Russell implied). However Italy is not part of the enhanced cooperation, can the definition of UP still cover Italy in the meaning of UPCA?

    I was also thinking regarding territorial scope of UPC and Article 34 UPCA
    Art 4 Brussel I (recast) gives courts jurisdiction on domicile as a general provision and of the place of the “harmful event” as an alternative (Art 7(2)). This would mean that UPC would be able to handle infringement anywhere if the defendant is domiciled within the UPCA contracting states, right? I try to find answer in the proposed amendment COM(2013) 554 final, but I find only extensions of UPC jurisdiction there.

    Is Article 34 UPCA then expressing some kind of unification of European Patents within the contracting Member States, similar to Art. 5(2) UP-R “scope of that right and its limitations shall be uniform
    in all participating Member States”. Does it go even further than the regulation? “Decisions of the Court shall cover, in the case of a European patent, the territory of those Contracting Member States”.

    It is a tricky task, deciphering the agreement.
    Thank you all for your interesting thoughts.

  22. ipcopymark says:

    Jonas

    Thank you for the further reply.I’ve gone over your comments and Russell’s comments again and can only conclude that the situation is muddled!

    Our opinion here at IPcopy is that it should be possible to have a unitary patent (an EP(UP)) and an Italian patent (EP(IT)) and for the EP(IT) to be opted-out from the competency of the UPC. In other words we don’t think the definitions at 2(e) and 2(f) of the UPCA are mutually exclusive and it is possible for a single granted European patent to then move into both of those definitions.

    However, finding something within either the UPCA or the unitary patent regulation that fully backs up this position is proving somewhat elusive!

    I suspect that if both our position and Russell’s position are arguably valid then it is a matter that will need to be decided either by a national court (i.e. Italy, if someone tries to run a court action in the Italian court when the EP patent it derived from has unitary effect) or possibly the CJEU.

    Mark

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