AIPLA Annual Meeting 2014
10. UPC Opt-out and Transitional Period
Is it advisable to opt out?
Dr. Jochen Pagenberg, Bardehle Pagenberg, Munich
pagenberg@bardehle.de
I. Introduction
After the opening of the EPO in 1978 it took 10 years before the first case reached the German Supreme Court on a question of EP law. Decisions within the EPO and outside in the
national courts followed slowly. This will not be much different with the UPC. Therefore in
my opinion only gamblers or patentees who own a number of less valuable patents and are
willing to spend money for test cases should leave those patents under the jurisdiction of the
UPC.
I would therefore answer the question with a clear YES. You should opt-out as early as possible and with all important patents.
II. The main reason: Doubtful experience and quality of judges
The main reasons can be found in my parallel Paper 4 on UPC JUDGES with my remarks
on the unproven quality and the possibly uneven and imbalanced patent litigation experience
of UPC Judges. I have based this warning on the fact that the original requirement of highest
standards of competence and proven experience in the field of patent litigation in Art. 15 UPC
have been replaced by Experience with patent litigation …may be acquired by training in Art.
2(3) of the Statute; highest standards of competence have been left out entirely.
For a number of reasons the first 10 years mean sailing in the fog. This is well reflected by
answers received in a recent Survey1 among stakeholders which comes to the conclusion
“At the present time it is clear that the potential users of the new system possess both
great hopes and great fears about the changes that will come with UPC and UP - with
the fears (increasing costs, greater complexity, more patent troll litigation) seemingly
outweighing the hopes (lower costs, one-stop enforcement).2
Therefore I would “wait and see” who the judges are and how the cases will be handled by the
different local, regional and central divisions before filing Unitary Patents and also before
filing the first litigation case with any local or central division. The experience and attitude of
the new divisions will probably remain unknown for a long time.
III. The UPC will need time to get operative
A. Disadvantages for early users
1
Survey by Dr. Luke McDonagh, Cardiff University, Exploring Perspectives of the Unified Patent Court and Unitary Patent
Within the Business and Legal Communities, Published by The Intellectual Property Office 2014
2 Ibid. p. 45
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You should examine whether it makes sense for applicants filing Unitary patents in the at the
beginning, since a number of advantages will not immediately be available:
Only after 12 years will the translation requirements for UPs be dropped3, so it will be
cheaper filing in a few national offices making use of the London Agreement in countries
which have renounced translations4.
If you file Unitary Patents in the first years after the entry into force of the Patent
Package, you will most likely not obtain protection for 24 countries but only for those countries which will have ratified. These may remain the minimum of 13 for quite a while.
There will be numerous legal questions on procedure which have been left open in the
Rules because of unclear drafting of the respective text of the Agreement. One should better
wait for decisions of the Court of Appeals instead of litigating those questions oneself.
Since most well-advised companies will act this way, there may be very few cases
having been handled by the divisions of the UPC during the first seven years.
B. Is there still a chance for improvement by way of the Revision Clause?
The severe mistake which the EU Commission (and the EU Council) made was the refusal to
provide for an option of owners of EP patents to choose between the UPC and the national
courts also beyond the opt-out period5. This would have avoided a number of serious deficiencies which the present system undoubtedly has:
it would have allowed for a full EU integration of the Patent Package by way of a EU
Regulation comparable to the Community trademark system, so that one would have a clear
distinction between EU and national jurisdiction rather than a complicated mix of national,
international and Community law as we have it now,
it would have dissipated the fears concerning the involvement of the CJEU, since
those who do not fear the CJEU or see financial advantages for their patent strategy would
have chosen the Unitary Patent and its fully integrated EU courts (rather than international
courts),
it would have rendered the complicated opt-out/opt-in system superfluous, since all
500 000 to 600 000 earlier filed EP patents would have remained in the “basket” as a permanent reserve with the full flexibility for patentees of making a case by case choice between the
UPC and the national courts when preparing an action on the basis of an EP patent,
it would have avoided the serious and also unpredictable risk that in particular large
companies will opt-out the majority of their patents so that the UPC will receive a very low
number of cases. This would lead to an unwelcome lack of experience up to the end of the
opt-out period when most of the divisions will be flooded with cases,
3
Art. 6(5) Reg 1260/2012
It must however be considered that a number of countries have blocked national filings via the PCT which are the following: Belgium, Cyprus, France, Greece, Ireland, Italy, Latvia, Lithuania, Malta, Monaco, the Netherlands and Slovenia
5 See for this proposal already Pagenberg, European Patent Disputes – The Future, in: Special issue for AIPPI Congress,
Boston 2008, id. European Patent Jurisdiction, Conference on Industrial Property Rights in the Internal Market Strasbourg –
16-17.10.2008
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it would have allowed SMEs to continue filing EP patents in the future and to enforce
them in individual countries where needed, at reasonable cost. Now, if they wish to avoid an
excessive financial and legal exposure their only choice is filing national patents which also
large corporation have started doing since a few years,
The reason for this unreasonable decision against the wishes of all stakeholders clearly was
that Commission and Council did not trust the quality and sufficient attractiveness of their
own system and therefore wanted to prevent competition between the national courts and the
UPC. But if the drafters do not trust there own system, how can they expect that the users
will? This could prove to become quite a blocking stone for the start of the new system.
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