With less than a month to go before the Unified Patent Court (UPC) takes effect, we felt it was important to provide an update on what will change and to address the main questions you may have on this topic.
Key points:
- While the Unified Patent Court (UPC) is dedicated to unitary patents, it also has jurisdiction over “traditional” European patents
- For your “traditional” European patents, the “opt-out” allows you to exclude these patents from the UPC’s jurisdiction to avoid any risk of centralized revocation
- It is important to determine your position now—for both your European patents and your European patent applications—with regard to the UPC
The Unified Patent Court on June 1—are you affected?
As a reminder, the UPC is an international court that will be established on June 1, 2023, at the same time as the unitary patent, and will therefore have exclusive jurisdiction over related disputes.
From the outset, it will cover the 17 member states participating in the unitary effect, including France, Germany, Italy, the Netherlands, and Belgium. Consequently, if a unitary patent is granted on or after June 1, 2023, you will necessarily be subject to the UPC’s jurisdiction.
However, the UPC’s jurisdiction is not limited to unitary patents alone.
In fact, it will also have jurisdiction over disputes relating to your European patent applications and your “traditional” (i.e., non-unitary) European patents validated for these same member states. As a result, even without a unitary patent, the UPC will apply to you if you are the owner of a European patent or a European patent application, effective June 1, 2023.
If this applies to you, what are the implications?
The UPC offers the advantage of centralized management of patent disputes in Europe.
Thus, in the event of infringement in multiple Member States covered by the UPC, you will be able to hold the infringer liable for all acts committed in those Member States. It will no longer be necessary to file a lawsuit in each country.
However, this advantage is also the major drawback of this jurisdiction. Indeed, if your “traditional” European patent is limited or revoked in the course of a dispute, that limitation or revocation will potentially apply to all 17 Member States for which the JUB has jurisdiction.
This is true even if the dispute concerns acts of infringement committed in only one Member State. It is therefore important to be aware of the risks inherent in such jurisdiction and to adapt your strategy accordingly.
Is it possible to opt out of the UPC’s jurisdiction?
During a 7-year transitional period, renewable once, jurisdiction over disputes relating to European patent applications and “traditional” European patents will be shared between the UPC and national courts.
As a result, it will always be possible to sue a third-party infringer in national courts and thus avoid any risk of centralized invalidation of your European patent.
Of course, this will not protect you if you file a case with the UPC (an action for invalidation or for a declaration of non-infringement).
If that were the case, the risk of centralized invalidation of your European patent would be at full risk. Similarly, after this transitional period, you will no longer be able to opt out of the UPC’s jurisdiction, since it will have exclusive jurisdiction over all disputes relating to European patents, whether unitary or “traditional.”
What is the “opt-out”?
To eliminate any risk of a competitor filing a centralized action with the UPC against your European patent and to ensure that national courts retain jurisdiction after the end of the transitional period, you may file an “opt-out” request.
This restores exclusive jurisdiction to national courts for disputes relating to your European patent applications or patents.
The “opt-out” is flexible: you can request it for some of your European patents while retaining dual jurisdiction for others.
Therefore, it may be worthwhile to review your patent portfolio to determine the best strategy on a case-by-case basis.
Is the “opt-out” permanent?
If you have filed an “opt-out” request for one of your European patents or European patent applications, you can always withdraw it by filing an “opt-in” request. Please note that once you opt out, you cannot opt back in.
Is “opt-out” right for you?
Because it is a new mechanism, we currently lack historical perspective on how the JUB actually operates. While the presence of technical judges suggests well-reasoned decisions, there is no case law yet, making it impossible to predict whether the initial decisions will favor the patent holder or the infringer.
However, without this information—and at the very least for your most strategic European patents and European patent applications—it may be wise to limit the risks of centralized revocation and avoid bearing the brunt of any initial “setbacks” by requesting an “opt-out.” This is all the more true given that you will always have the option to withdraw your opt-out once case law has been established or if you need to initiate centralized proceedings against one of your competitors.
Similarly, if your European patents cover only a limited number of Member States, it may be worthwhile to reduce uncertainties regarding the competent jurisdiction. A centralized action would be of little benefit for this type of European patent.
For less strategic applications, where the risks are lower, you may decide to take no action and leave the dual jurisdiction between the Unified Patent Court (UPC) and national courts open during the transitional period.
Of course, as always, the entire Brandon-IP team is ready to assist you through this significant development in European patent law. Please feel free to contact us to refine the strategy for your patent portfolio with regard to the UPC.