Single European Patent System Dealt EU Blow
A granted European patent provides the patent owner with a "bundle" of independent, national patent rights for those EU member states in which the patent has been validated. As such, once the period for the centralised procedure has passed, patents are generally enforced or revoked at a national level. In some national courts (for instance the UK and the Netherlands), validity and infringement proceedings are commonly heard together, whereas others (notably Germany) have separate courts that determine validity and infringement.
The European Patent Convention provides the central legal framework and sets out the substantive basis for determining ownership, patentability and infringement for European patents. The Protocol to Article 69 of the EPC provides some guidance; however, interpretation of substantive issues is left to the national courts. Although the goal is consistent interpretation throughout member states, individual national courts apply the principles differently.
This is unfortunate. A single European patent system could be of real benefit to patentees (and correspondingly disadvantageous to those who sail close to the patent wind). A single patent system also could streamline the time and cost of European patent litigation.But given the very real national differences in interpretation, when there are patents and relevant activity in a number of member states, forum shopping arises — not only for courts that may offer a favourable interpretation, but also for the possibility of cross border injunctive relief. Another option is the use of slower moving forums to hold up infringement cases across Europe — commonly known as torpedo actions.
Article 2 of the Brussels Convention which sets out rules for jurisdiction and enforcement of judgments across EU member states holds that an entity should be sued in the country of domicile. There are also provisions regarding when a member state would have exclusive jurisdiction over proceedings, one of those being determination of the validity of that national patent right (Article 16). Further provisions state that where there are related actions, another member state court must stay its proceedings until the court first seized of that matter has determined the issue at first instance. A national court may have jurisdiction over actions in another jurisdiction if there is a connection between the actions such that determining the actions together would avoid the risk of irreconcilable judgments. In 2006, the Roche v Primus decision restricted pan-European injunctive relief by holding that under the Brussels Convention a national court had no jurisdiction over an entity not domiciled in that country and not infringing the relevant national patent.
This ruling also held that only where there was the same legal and factual context would such a risk of irreconcilable judgments arise, and only in that instance would a national court have jurisdiction over an entity domiciled in another member state and carrying out activity related to another member state's patent
The Rome II Regulation, which came into force in January 2009 specifically provides that for non-contractual disputes, patent infringement should be determined in the jurisdiction in which the patent right lies. This is consistent with the exclusive jurisdiction to determine validity of the national right that a national court has under the Brussels Convention. In conjunction with the Roche v Primus decision, this Regulation appears to limit the opportunity to forum shop in cross border litigation. However, a recent reference from the District Court of The Hague to the Court of Justice of the European Union in the case of Solvay v Honeywell may revive opportunities for forum shopping in limited circumstances. Solvay alleged patent infringement of Dutch and foreign patents by Dutch and Belgian defendants. The Dutch court held it had jurisdiction over the Dutch defendants in relation to infringement of the Dutch and foreign patents and held that, in order to avoid irreconcilable decisions, it also had jurisdiction over the Belgian defendant in respect of both the Dutch and foreign patents. The Dutch court distinguished Roche v Primus by noting that the Solvay defendants were carrying out the same activity and infringing the same foreign patents, whereas in Roche v Primus, the defendants' alleged infringing activities related only to activities which would infringe their respective national patents.
This case is ongoing. It may take as long as two years to see whether the CJEU indicates whether it agrees.Torpedo actions as a pre-emptive strike are still a possibility but are currently not in as much favour as they were. A potential defender thinking it may be sued for infringement in jurisdictions where it may lose, could pre-empt such an action by bringing a declaration of non-infringement action in another jurisdiction. If the potential Defendant brings this action in a court with a backlog of cases and limited resources, that court will be “first seized” under the Brussels Convention; thus other jurisdictions are obliged to stay any proceedings involving the same cause of action until that first court has reached a decision at first instance. Belgium and Italy where cases have to date been slow to come to trial - around a year for Belgium and two to three years for Italy - have been used in this way for many years, allowing a potential infringer to considerably extend market activity.
The CJEU has made it clear that forum shopping is not to be used improperly, but has also stated that derogation from the principle that a defendant must be sued in the country of domicile on the basis that a “slow” country is first seized, is inappropriate. Italian courts have more recently not accepted cross border jurisdiction where validity is put in issue on the basis that this is a matter for individual member courts to rule.
Therefore, to make use of a torpedo action a potential defender needs to be careful about how an action for a declaration for non-infringement is worded. Alongside the creation of a European Patent, the European Union has been seeking to establish a unified patent litigation system for enforcing both the European patent and national patents granted through the centralised system. A unified court system would avoid the complications created by different courts and jurisdictions reaching contradictory decisions on the same patent, or working to different timescales.
On Tuesday, 8 March 2011 these plans were derailed when the CJEU ruled that the system proposed is not compatible with European law. Although not fatal, as the European patent could be enforced through the existing national courts, the usefulness of the European patent to industry will be compromised if legal issues cannot be addressed on a European wide level.
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