The Unified Patent Court: So Close, and Yet so Far ...?
The latest proposals for a single patent (the Unitary Patent) and a single patent court for EU Member States (the Unified Patent Court of UPC) have seen a recent surge of activity, but does that mean the UPC will go ahead?
The Central Division
With Denmark's presidency of the EU drawing to a close at the end of June, and no decision on the location of the Central Division of the UPC, it looked like the latest attempt in a forty year saga to seek a single patent court for Europe might be on the rocks. However, following a meeting of the EU Council, on Friday 29 June 2012, it looked like the UPC might finally be on track. In the spirit of true compromise, Member States agreed in the EU Council that the location of the Central Division would be split "given the highly specialised nature of patent litigation and the need to maintain high quality standards". The proposed split is:
- Paris - seat of the Central Division, along with the office of the President of the Court of First Instance. The first President of Central Division should come from Paris
- London - chemistry, including pharmaceuticals, classification C, human necessities, classification A
- Munich - mechanical engineering, classification F
Articles 6 to 8
Interestingly, as part of this compromise, British Prime Minister, David Cameron, obtained agreement that the Council should ask its Committee of Permanent Representatives to agree to deletion of controversial articles 6 to 8 of the proposed Regulation for a Unitary Patent (part of the patent reform package along with the draft UPC agreement). The key concern with these provisions is that they make infringement of a Unitary Patent a question of EU law. This means that the ultimate interpretation of that law lies with the Court of Justice of the EU (CJEU).
However, many critics complain that the CJEU does not have the necessary expertise to deal with complicated patent infringement matters, and adds significant delay to the resolution of proceedings. So the compromise reached by the Council was for many welcome news, and paved the way for Members of the European Parliament (MEPs) to vote on the EU patent at a meeting scheduled for Wednesday, 4 July 2012 (appropriately enough, Independence Day).
In a further twist, on Monday 2 July 2012, MEPs postponed that vote. The concern of some MEPs appears to be that removing articles 6 to 8 will "emasculate the proposal", and suggesting that if the proposals go ahead with the deletion of Articles 6 to 8, the issue will end up before the CJEU, because without Articles 6 to 8, the UPC agreement will be in breach of provisions in the EU Treaty regarding uniform protection of IP rights.
On 10 July 2012, it was confirmed that opinions would be produced by the EU Parliament, Commission, and Council's legal teams over the summer on the proposed deletion of Articles 6 to 8 from the draft UPC Agreement. So further news is expected in September.
Is it legal?
Separately, on 20 June 2012, a motion was released supported by a number of law professors and lawyers, which refers to an opinion of the Legal Department of the European Council. This opinion, which has not been made public, apparently addresses whether the draft UPC Agreement is legal in light of the negative opinion of the CJEU on the previous draft. The motion states that it would be futile to press ahead with the UPC without first determining publicly whether the proposed system is illegal.
Indeed, as reported in our January IP newsletter, it has never been clear that the issues raised by the CJEU were adequately dealt with in the current draft agreement. There is also the potential for other issues to arise, such as:
The European Parliament's 2008 opinion on an earlier court proposal (the European Patent Litigation Agreement) which found the court was not viable because EU states had already given away power to the EU to decide on points proposed in the EPLA on interpretation, jurisdiction and enforcement of IP rights.
The Italian and Spanish objections to the Unitary Patent which are still pending before the CJEU. It has repeatedly been stated that the UPC and the Unitary Patent are a package. If the CJEU finds the Unitary Patent Regulation to be unlawful, what impact would this have on the UPC proposals?
By Katie McConnell, Of Counsel
Senior Associate, Hogan Lovells