ARE IP COURTS IN EUROPE REALLY UNIFIED?

Ian Hiscock (Novartis)

Rob Jacob (Stephenson Harwood LLP)

• Rt Hon Professor Sir Robin Jacob

• Cambridge educated

• One of the UK’s most influential IP judges of all time

• Admitted to the IP hall of fame in 2003

• Sir Hugh Laddie chair of IP at UCL

• Rob Jacob (Stephenson Harwood)

• French – GCSE

• Done a bit of IP

• 25m swimming badge

THE APPLICANT’S CASE THE IP COURTS IN EUROPE ARE UNIFIED

EU Harmonisation History and Objectives

• All roads lead to Rome –> The Treaty of Rome • The Union shall establish an internal market (Art 2).

• Bulmer v Bollinger [1974] Ch. 401 • When we come to matters with a European

element, the Treaty is like an incoming tide, it flows into the estuaries and up the rivers. It cannot be held back, Parliament has decreed that the Treaty is henceforward to be part of our law. It is equal in force to any statute (Lord Denning at 418)

• Today 80% of national law originates from Europe

Trade Mark Harmonisation

• Arsenal FC v Reed - C-206/01 • Trade Mark rights constitute an essential

element in the system of undistorted competition which the treaty is intended to establish and maintain. In such a system undertakings must be able to attract and retain customers by the quality of their goods or services, which is made possible only by distinctive signs allowing them to be identified

Trade Mark Harmonisation: The Community Trade Mark

• A single trade mark right with effect throughout the EU • Decisions regarding the validity and infringement of community trade marks

must have effect and cover the entire area of the Community (Recital 16 CTMR)

• A single set of laws and rules applicable throughout the EU • Community Trade Mark Regulation

• Article 9 sets out the rights conferred by a trade mark

• Articles 12 (defences) and 13 (exhaustion) sets out limitations

• New CTM Reform

Trade Mark Harmonisation: The European Union Trade Mark

• The Community Trade Mark Courts • Office for Harmonisation of the Internal Market

• Registration • Cancellation

• A Community trade mark court located in each Member State • Infringement / Declaration of non-infringement • Cancellation (basis of counterclaim only)

• Court of Justice of the European Union • Interpretative court

• Avoidance of Inconsistent Decisions • In the interests of the harmonious administration of justice it is necessary to minimise

the possibility of concurrent proceedings and to ensure that irreconcilable judgments will not be given in two Member States (Recital 15 Brussels Regulation)

Trade Mark Harmonisation: National Trade Marks

• National trade marks with effect in a single Member State only • National laws should not have an affect on the internal market

• Trade Mark Directive • Article 5 sets out the rights conferred by a trade mark

• Articles 6 (defences) and 7 (exhaustion) sets out limitations

• Silhouette International Schmied GmbH & Co. KG v Hartlauer [C-355/96]: • Articles 5 to 7 of the Directive must be construed as embodying complete harmonisation of

the rules relating to the rights conferred by a trade mark

• EFTA Countries (Norway, Iceland and Liechtenstein) • Will also follow the Trade Mark Directive

Community Design and Copyright Harmonisation

• Designs • Community Design Regulation

• Registered Community Design • Unregistered Community Design

• Design Directive • National designs

• Copyright • Berne Convention • TRIPS • Term Directive • Software Directive • Database Directive

Patent Harmonisation:

Patent Harmonisation: Post-War Patent Unification

June 1947

International Patent Institute Search and Examination

The Hague

Sept 1949

The Council of Europe Planning starts for a European Patent Office

Patent Harmonisation: Objectives of the Council of Europe

Three propositions:

1. A unitary patent coexisting with national patents

2. A system for granting “bundles” of national patents, supported by a central European patent authority

3. A convention requiring the voluntary unification of substantial aspects of national patent law

Patent Harmonisation: Post-War Patent Unification

25 March 1957

The Treaty of Rome New European Economic Community

Patent Harmonisation: Patent Unification in the 1960s

Early 1962

EEC working group Draft European Patent Convention

November 1963

Council of Europe Expert Group Draft Community Convention

Patent Harmonisation: Patent Unification in the 1970s

June 1970

Patent Cooperation Treaty (PCT) Signed in Washington

October 1973

European Patent Convention (EPC) Signed in Munich

December 1975

Community Patent Convention (CPC) Signed in Luxembourg

Patent Harmonisation: Patent Unification in the 1970s

October 1973

European Patent Convention (EPC) Signed in Munich

December 1975

Community Patent Convention (CPC) Signed in Luxembourg

7th October 1977

European Patent Convention (EPC) Enters into force

Patent Harmonisation: Patent Unification in the 1980s

December 1989

Community Patent Convention (CPC) Signed in Luxembourg (again)

Patent Harmonisation: Patent Unification in the 2000s

died: February 2007

European Patent Litigation Agreement (EPLA)

died: March 2011

Unified Patent Litigation System (UPLS)

died: May 2004

Community Patent Regulation (CPR)

Patent Harmonisation: Patent Unification in the 2010s

19th February 2013

Agreement on a unitary patent court

17th December 2012

Regulation 1257/2012 on creation of a unitary patent protection

Regulation 1260/2012 with

regard to translation arrangements

Patent Harmonisation: Patent Unification in the 2010s

19th February 2013

Agreement on a unitary patent court

13 or more ratifications including FR, DE + UK

Q3 2016

Unitary Patent and Unified Patent Court

Q1 2017

Patent Harmonisation: Objectives of the Council of Europe

Three propositions:

1. A unitary patent coexisting with national patents

2. A system for granting “bundles” of national patents, supported by a central European patent authority

3. A convention requiring the voluntary unification of substantial aspects of national patent law

Patent Harmonisation: The Unified Patent Court (UPC)

Patent Harmonisation: The Unified Patent Court (UPC) Fees

• Fixed fee for all actions plus value-based fee for infringement actions valued above €500,000

• Infringement action: €11,000 plus value-based fees up to €325,000 (for an action valued above €50,000,000).

• Revocation action: €20,000. No value-based fee.

• Counterclaims for revocation: same fee as the infringement action, up to a limit of €20,000.

• Appeal fees: same as the fees payable at first instance.

• Small and micro entities entitled to a 40% reduction on all Court fees.

Patent Harmonisation:

One Patent

One Patent Court

25 Countries

THE OPPONENT’S CASE THE IP COURTS IN EUROPE ARE NOT UNIFIED

Are the Trade Marks Courts Really Unified? 1. Direct Conflicts

• Trade mark registration defence in UK • Silhouette confirmed in Case C-561/11 (Fédération Cynologique

Internationale v Federación Canina Internacional de Perros de Pura Raza) • UK section 11(1) TMA

• A registered trade mark is not infringed by the use of another registered trade mark in relation to goods or services for which the latter is registered

• Colour per se in Portugal • CJEU – Libertel, para 42:

• A colour per se is capable of constituting a trade mark within the meaning of Art. 2 of the Directive

• Portugal: Art 223, 1, e): • The following do not meet the requirements of the preceding article (composition of

trade marks)…. colours, except when they are combined together or with graphics, wording or other elements in a particular and distinctive manner

Are the Trade Marks Courts Really Unified? 2. Interpretation

• Mühlens GmbH v Zirh International • T-355/02 (CFI): Visual and conceptual

differences outweigh Phonetic similarities: No likelihood of confusion

• 315 O 168/03 (Germany): Dismissed CFI decision stating Phonetic similarity should not be disregarded: Likelihood of confusion

• C- 206/04 P (CJEU): AG Opinion stressed importance of cooperation between the Court of Justice and the national courts

Are the Trade Marks Courts Really Unified? 3. No precedent system

• OHIM not bound by national decisions: • “ …examiners are not required, as a general rule, to give specific reasons for

not following a national decision or a series of national decisions”, OHIM Board of Appeal in “True Value” (R 85/1999-1, Dec. 15, 1999)

• “the Office is not bound by decisions on a national level since it has to set its own European standard for judging the similarity of goods”, OHIM Opposition Division in Knoll AG v. Pharma Mar S.A. (2236/2001, Sept. 13, 2001)

• “the Community trade mark regime is an autonomous system with its own set of objectives and rules peculiar to it; it applies independently of any national system.” CFI in Wim De Waele (T-15/05, May 31, 2006)

Are the Trade Marks Courts Really Unified? 3. No precedent system

• Nestle v Cadbury • OHIM: R-513/2011-2

The mark has acquired distinctiveness as a result of the use made of it

• UK: [2016] EWHC 50 (Ch) The claim of acquired distinctiveness fails

Are the Trade Marks Courts Really Unified? 4. Optional provisions and carve-outs

• Unregistered Trade Marks not covered • Passing Off (United Kingdom) – (similar to Art 9(1)(b)

• goodwill • Misrepresentation • Damage

• Unfair Competition – (similar to Art 9(1)(c)) • Reputation • Misrepresentation or Unfair Advantage or Detriment

• Optional Provisions in Trade Mark Directive • Trade marks with a reputation • Effect of earlier unregistered rights on registrability • Bad Faith

Are the Trade Marks Courts Really Unified? 5. No procedural harmonisation

• The result should be the same but the road you take can be very different • Member States should also remain free to fix the provisions of procedure

concerning the registration, the revocation and the invalidity of trade marks acquired by registration (Recital 6 of TMD)

• The ways in which likelihood of confusion may be established, and in particular the onus of proof, should be a matter for national procedural rules which should not be prejudiced by this Directive (Recital 11 of TMD).

• Unless otherwise provided in this Regulation, a Community trade mark court shall apply the rules of procedure governing the same type of action relating to a national trade mark in the Member State in which the court is located (Article 101(3) CTMR).

Are the Trade Marks Courts Really Unified? 5. No procedural harmonisation

• Procedural Differences • Specialist judges

• Timing

• Cost

• Evidence • Surveys

• Witnesses

• Bifurcation

• PI Urgency

Are the Trade Marks Courts Really Unified? 5. No procedural harmonisation

• Forum Shopping (Claimant) • Brussels Regulation

• National vs Community rights

• Parties

• PI Injunctive relief

• Forum Shopping (Defendant) • Torpedoes

• Validity challenges

• Declaration of non-infringements

• Parties

Will the Unified Patent Court really be Unified?

1. To be or not be... in the UPC

• Article 83(3) UPC Agreement:

The right holder “shall have the possibility to opt out from the exclusive competence of the Court.”

• No “opt out” for a European patent with unitary effect

• Can be requested at any time during the 7-year transitional period (unless an action has already been brought before the UPC)

• Can be withdrawn at any time (unless an action has already been brought before a national court)

Will the Unified Patent Court really be Unified?

2. The national courts are not fully harmonized

Study of Patent Litigation 2000-2010

Rejection of all invalidity arguments: UK – 35% of all cases NL – 38% DE – 42% FR – 56%

Finding on infringement: NL – 31% infr. / 68% non-infr. UK – 45% infr. / 43% non-infr. DE – 52% infr. / 44% non-infr.

From: Stuart J.H. Graham & Nicolas Van Zeebroeck

17 Stan. Tech. L. Rev. 655 (2014)

Will the UPC really be Unified?

3. The shifting boundaries of Unitary Patent & UPC scope

Hypothetical: First 13 Ratifications

Will the UPC really be Unified?

3. The shifting boundaries of Unitary Patent & UPC scope

Hypothetical: Further Ratifications will result in Unitary Patents and UPC decisions covering anything from 13 up to 25 countries

Will the UPC really be Unified?

3. The shifting boundaries of Unitary Patent & UPC scope

Hypothetical: ...and at its maximum, all 28 EU Member States

Will the Unified Patent Court really be Unified?

4. Differences in national & European laws

Potential areas of conflict include:

• Exemptions to patent infringement

• Contributory infringement

• Joint tortfeasors

• Differences in claim construction

Will the Unified Patent Court really be Unified?

5. Supplementary Protection Certificates

Potential areas of conflict include:

• Application of the Neurim decision for “use” SPCs

• Application of the Seattle decision for term calculation

• Can a unitary patent serve as a basic patent?

• SPC with unitary effect – based on a unitary patent

Will the UPC really be Unified?

6. The rise of national patent applications

Hypothetical: Possible use of national patent applications which would never be subject to the competence of the UPC

Are IP courts in Europe really unified?

FUTURE ASPIRATIONS

FUTURE ASPIRATIONS TRADE MARKS

• More CJEU referrals on points of unknown law

• Quicker CJEU guidance

• Courts to give more weight to other national and Community court decisions

• Agreed harmonised time targets from commencement to decision

• Specialist judges in specialist national courts

• Specific courts for specific matters/issues?

• Harmonisation of unregistered rights

• Procedural harmonisation

FUTURE ASPIRATIONS

FUTURE ASPIRATIONS PATENTS

Short Term:

• Build confidence in the UPC system

• Shape case law in the UPC

• Engage with the Commission on the IPR Enforcement Directive review

• Actively contribute to the review of the SPC Regulation

Long Term:

• Clear and consistent case law from the UPC Court of Appeal

• Greater legal certainty and predictability

• Will patents still be the exclusivity-driver for pharmaceutical industry?

Any Questions?