The document discusses the role and application of European Union law by the Unified Patent Court (UPC). Key points include: - The UPC will apply EU law first in its entirety and respect its primacy over other laws. It must cooperate with the Court of Justice of the EU (CJEU) and refer questions to ensure correct application of EU law. - The UPC will apply substantive laws in the following order: EU law, UPC Agreement, European Patent Convention, international agreements, and national laws of contracting states. - The UPC judgments will be recognized in EU member states under the Brussels I Regulation. However, recognition can be refused if manifestly contrary to public policy. - The

1. Training Centre BudapestTraining Centre Budapest
Wouter Pors
Bird & Bird The Hague
23 April 2015
The Unified Patent Court
& EU Legislation

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European Union law: general
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Relevance of Union law
• Article 20 UPCA: the Court shall apply Union law in its entirety and shall
respect its primacy
• Article 24 UPCA: order of priority of legislation (Union law 1st)
• Article 5 UP Regulation: the scope of the Unitary Patent and its
limitations shall be uniform in all participating Member States in which the
patent has unitary effect
• Article 21 UPCA: referrals to the CJEU: the Court shall cooperate with
the CJEU to ensure the correct application and uniform interpretation of
Union law, see Article 267 TFEU
• Article 267 TFEU: obligation to refer questions to the CJEU
• Court of First instance may refer – some national courts do
• Court of Appeal must refer – Contracting Member States are liable for
infringement of Union law under Article 22 UPCA
• Consideration: liability includes failure to request preliminary rulings
• Commission may also bring infringement actions against Member States
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Substantive law applied by the UPC
• To be applied in the following order: (Articles 20, 24 UPCA)
1. Union Law
− Unitary Patent Regulation, Translation Regulation, SPC
Regulations, Biotech directive, Brussels I Regulation, Enforcement
Directive, Rome Regulations, etc
2. UPC Agreement
− Infringement (Articles 25 - 30)
3. European Patent Convention
− Validity
− Infringement (Article 69)
4. International agreements
− TRIPs, Lugano Convention, Hague Evidence Convention, etc
5. National law
− Patent law, damages, ownership, licences, bankruptcy, etc
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Substantive law applied by the UPC
… and national law
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Fundamental balance in general EU law
• Treaty on European Union
• Treaty on the Functioning of European Union
• Scope of IP rights limited to specific subject of protection
• Balance with free movement of goods and services
• CJEU case law, especially on trademarks
• Charter of Fundamental Rights of the EU
• Article 17(2): intellectual property shall be protected
• Article 16: the freedom to conduct a business in accordance with
Community law and national laws and practices
• CJEU case law, especially on copyrights
• Article 11: everyone has the right to freedom of expression
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Brussels I Regulation
• Regulation (EU) 1215/2012
• Regulation (EU) 542/2014
• Issues governed
• Jurisdiction
• Recognition
• Lis pendens
• Enforcement
• Refusal of recognition
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Recognition of judgments - principle
• Article 71a: UPC is deemed to be a court of each Contracting
Member State – but not subject to national procedural law
• A Court is bound by final decision of other competent Courts
• CJEU 15-11-2012, C-456/11, Gothaer vs Samskip: judgment of Court
that rejects jurisdiction on the basis of choice of forum has to be
respected.
• CJEU 27-04-2004, C-159/02, Turner vs Grovit: cross-border anti-suit
injunctions are not allowed, as all Courts have to be respected;
confirmed in CJEU 10-02-2009, C-185/07, Allianz vs West Tankers
• All courts within the EU respect one another (Article 52)
• However: no EU “Supreme Court”
• CJEU jurisdiction limited to referrals / specific actions
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Recognition of judgments - practice
• Article 36 – 38 & 45: simplified procedure for recognition of
judgments from Courts of other Member States
• Does not apply for UPC judgments in its jurisdiction – UPC is
deemed to be a Court of each Contracting Member State
• Does apply to recognition of UPC judgments in Croatia, Poland and
Spain (Article 71d)
• Does recognition create stare decisis?
• Are UPC and national courts mutually bound?
• With regard to issues decided in a judgment
• I.e. decision of national court on patent ownership
• But invalidated by UPC
• This question could also be raised between national courts
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Lis pendens: traditional Eps – UPC vs national courts
• Choice UPC – national courts: infringement and revocation (Article 83 UPCA)
• Court first seized has jurisdiction over the claim brought before that court
• Articles 29 – 32 and 71c.2 Brussels I Regulation (recast)
• Same cause of action + same parties
• Exclusive jurisdiction of court first seized
• Other courts stay until jurisdiction is established, then decline
• Related actions: so closely connected that it is expedient to hear and determine
them together to avoid the risk of irreconcilable judgments
• Stay by other courts optional
• Decline upon request if action can be consolidated in court first seized
• Exclusive jurisdiction (same or related) – i.e. validity UPC vs national courts
• Exclusive jurisdiction of court first seized
• Only the court that is not first seized can refer related case on request –
national court first seized cannot refer to UPC
• Article 33: rules may also be applied in favour of non-EU Court
• Except in cases of exclusive jurisdiction
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Lis pendens – when is a court seized?
• Article 32:
• Two systems exist in the EU:
• 1 – at the time when the document instituting the proceedings or an
equivalent document is lodged with the court, provided that the
claimant has not subsequently failed to take the steps he was required
to take to have service effected on the defendant
• UPC, Germany
• 2 – if the document has to be served before being lodged with the
court, at the time when it is received by the authority responsible for
service, provided that the claimant has not subsequently failed to take
the steps he was required to take to have the document lodged with the
court
• The Netherlands
• Authority in country of claimant  as that is within his power
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Lis pendens in practice - examples
• Infringement action pending at UPC
• Infringement action at national courts blocked
• Is revocation at national court related action (30.3 Brussels I)?
• In UK and The Netherlands: yes?
• In Germany: no – bifurcation?
• Infringement action pending at national court
• UPC has jurisdiction for remaining countries
• UPC has jurisdiction for revocation action
• Validity action pending at UPC
• Infringement action at national court?
• Validity action pending at national court
• Validity action at UPC for remaining countries – stay?
• Infringement action at UPC?
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Enforcement
• Article 39 – 44 & 45: simplified procedure
• No declaration of enforceability required anymore
• Enforcement governed by law of Member State addressed
• Court of origin shall issue certificate of enforceability – includes UPC
• No further role for UPC
• Article 54: adaptation of measures to those available in State addressed
• Article 58 - 60: enforceability of authentic instruments and settlements
• Settlement is of course a defence before the UPC
• Otherwise not relevant for UPC
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Refusal of recognition (& enforcement)
• Article 45: refusal of recognition and enforcement if:
• Recognition is manifestly contrary to public policy (ordre public) in the
Member State addressed
• Does not apply to decision on jurisdiction
• In case of default judgment defendant could not properly defend his case
• Irreconcilable with judgment between same parties
• Lis pendens rules not obeyed?
• Irreconcilable with earlier recognizable judgment in another Member State
or in a third State involving the same cause of action and between the
same parties
• In violation of exclusive jurisdiction
• Article 46 - 51: procedure for refusal
• Refusal may also affect the UPC – recognition of national judgment
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SPC Regulation
• Regulation (EC) 469/2009 medicinal products
• Regulation (EC) 1610/96 plant protection products
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Role of the UPC
• 3 UPCA: Agreement applies to SPCs for EPs
• 30 UPCA: A supplementary protection certificate shall confer the
same rights as conferred by the patent and shall be subject to the
same limitations and the same obligations
• Patent-like protection (CJEU C-442/11, Novartis)
• 32(1)(a) UPCA: infringement of SPCs and related defences
• 32(1)(b) UPCA: declaration of non-infringement
• 32(1)(d),(e) UPCA: declaration of invalidity of SPCs
• SPCs are granted by national authorities, but the UPC is deemed to be
a national court in all 25 Contracting Member States
• Can it invalidate such an SPC, or merely declare invalidity?
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SPC Regulation - justification
• Patents for medicinal products often cannot be exploited fully, as it takes
time to obtain a marketing authorization for the product
• Marketing authorizations regulated by Directive 2004/27/EC, 2004/28/EC
• As a consequence, there is insufficient time to regain investments through an
exclusive market position
• This is compensated by way of a “supplementary protection certificate”,
which is a sui generis right that extends the term of the patent in a limited
way
• Limited to the scope of the basic patent for the product or process
• Limited to the specific product for which the marketing authorization was
granted: it is not a right on an invention, but on a product
• The extension of protection is determined by the time it took to obtain a
marketing authorization
• SPC’s are granted country-by-country by national authorities
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Conditions for obtaining an SPC
• Product protected by a basic patent
• Product = active ingredient or combination thereof
• Active ingredient must have therapeutic effect, an adjuvant does not qualify (CJEU
C-431/04, MIT, C-210/13, GSK)
• Active ingredient needs to be identified/specified in claim, but the medicine may
also contain other active ingredients (CJEU C-322/10, Medeva)
• Marketing authorization needs to cover all ingredients from the claim
• A valid marketing authorization has been granted
• Active ingredient must have the effect as mentioned as an indication for the
medicine in the authorization (CJEU C-631/13, Arne Forsgren)
• Which is the first one for this ingredient as part of a medicine
• More products per patent possible (CJEU C-484/12, Georgetown)
• More patents per product possible (CJEU C-482/07, AHP)
• There has not yet been a previous authorization for the same product
• For an application within the scope of the patent (CJEU C-130/11, Neurim)
• SPC then covers new use of active ingredient
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Term of SPC
• Period between filing of patent application and first marketing
authorization in EU/EEA, minus 5 years
• In EU only MAs under the EU Directives (CJEU C-127/00, Hässle)
• Or Mas from EEA, or Swiss MA (CJEU C-617/12, AstraZeneca)
• Maximum duration is 5 years
• Maximum 15 years after first authorization
• CJEU C-555/13, Merck Canada
• Paediatric extension of 6 months
• Article 36 Regulation (EC)1901/2006
• This also applies if term of SPC is negative (CJEU C-125/10, MSD), but
extension results in positive term
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Issues with SPCs
• There is no Unitary SPC Regulation
• Can national authorities grant USPCs?
• Overhaul of existing Regulations required; cannot be avoided if UP SPC
Regulation is enacted
• Third party SPCs
• Holder of basic patent applies for SPC on the basis of MA of third party
and then attacks that third party
• CJEU C-181/95, Biogen: SPC may be granted to each patent holder,
even if only one of them holds a marketing authorization
• But what if the patent holder has no product, but applies for an SPC on
the basis of a marketing authorization of a non-related generic
company, for the purpose of attacking that generic company?
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Rome Regulations
• Rome I (contractual) (EC) 593/2008
• Rome II (non-contractual) (EC) 864/2007
• Determines the substantive law applicable to an issue
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Rome I – contractual obligations (1)
• Article 4: residence of party that has to perform characteristic
performance or country most closely connected
• Licences: law of country of patent owner / execution of licence
• Article 3: freedom of choice of law
• Article 9: overriding mandatory provisions
• Regarded as crucial by a country for safeguarding its public interests, such
as its political, social or economic organisation, to such an extent that they
are applicable to any situation falling within their scope.
• Article 21: The application of a provision of the law of any country
specified by this Regulation may be refused only if such application is
manifestly incompatible with the public policy (ordre public) of the forum
• It should be clear that a provision is overriding
• Example: Data Protection Directive does not exclude choice of law or
choice of forum.
• But there may be administrative law sanctions
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Rome I – contractual obligations (2)
• Relation to Unitary patent
• Article 7 UPR: unitary patent as an object of property
• shall be treated in its entirety and in all the participating Member States as
a national patent of the participating Member State in which that patent
has unitary effect and in which, according to the European Patent Register,
on the date of filing of the application:
• Applicant has residence or principal place of business
• Applicant has a place of business
• If none, law of EPO headquarters = German law
• Co-owned patents: applicant first listed
• Co-ownership agreements, licences: choices of law takes priority
• Choice of law does not cover non-contractual issues:
• Transfer of property requirements, establishing securities
• Effects of bankruptcy
• 7 UPR does not always overrule national law
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Rome II – non-contractual (1)
• Article 4(1), tort:
• Law of the country in which the damage occurs irrespective of the
country in which the event giving rise to the damage occurred and
irrespective of the country or countries in which the indirect
consequences of that event occur.
• Law of common domicile
• Country manifestly more closely connected
• I.e. closely connected pre-existing contract
• Article 5, product liability
• Habitual residence of person sustaining the damage
• Where product was acquired (if marketed there)
• Where damage occurred (if marketed there)
• Country of defendant if marketing abroad was unforeseeable
• Country manifestly more closely connected
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Rome II – non-contractual (2)
• Article 6, unfair competition
• Country where competitive relations or the collective interests of
consumers are, or are likely to be, affected
• If one competitor affected: rules for tort
• Non-contractual obligation arising out of a restriction of competition shall
be the law of the country where the market is, or is likely to be, affected
• Under certain conditions, law of the country of the Court seized
• This is an overriding mandatory provision (Article 6(4))
• Article 8, intellectual property rights
• Lex loci protectionis (protection claimed, infringement committed)
• This is an overriding mandatory provision (Article 8(3))
• Article 14, freedom of choice of law after the fact
• Except for unfair competition or IP rights (why IP rights?)
• Solution by arbitration or mediation? – Article 35 UPCA
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Biotechnology Directive
• Directive 98/44/EC
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Biotech Directive: principles
• Governs patentability of biotech inventions
• Does not deal with practising biotech as such
• If fear for tampering with life is the motivator, why are patents the focus instead of
the technology itself?
• Starting point: Member States shall protect biotech inventions
• Scope of protection for a patent on a
• Biological material possessing specific characteristics as a result of the invention
shall extend to any biological material derived from that biological material
through propagation or multiplication in an identical or divergent form and
possessing those same characteristics (Art. 8)
• Product containing or consisting of genetic information shall extend to all material,
save as provided in Article 5(1), in which the product in incorporated and in which
the genetic information is contained and performs its function (Art. 9)
• Specific exhaustion rules (Art. 10, 11)
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Exceptions to patentability
• Art. 4: plant and animal varieties, essential biological processes for the
production of plants or animals
• Art. 5: human body, simple discovery of its elements, sequences of genes
• An element isolated from the human body or otherwise produced by means of a
technical process, including the sequence or partial sequence of a gene, may
constitute a patentable invention, even if the structure of that element is identical
to that of a natural element
• Industrial application of (partial) sequence of gene must be disclosed in application.
• Art. 6: contrary to ordre public or morality, such as:
• Processes for cloning human beings
• Processes for modifying the germ line genetic identity of human beings
• Uses of human embryos for industrial or commercial purposes
• Processes for modifying the genetic identity of animals which are likely to cause
them suffering without any substantial medical benefit to man or animal and animals
resulting from that process [what about Harvard mouse with activated oncogene?]
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Case law
• The Directive requires further development in case law
• Concepts are not always clear
• Proportionality and subsidiarity need more guidance
• CJEU 18-12-2014, C-364/13, International Stem Cell Corporation
• Art 6(2)(c): an unfertilised human ovum whose division and further
development have been stimulated by parthenogenesis does not
constitute a ‘human embryo’, within the meaning of that provision, if, in
the light of current scientific knowledge, it does not, in itself, have the
inherent capacity of developing into a human being
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Trade Secrets Directive
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Council Proposal for Trade Secrets Directive
• Patents & innovations include know-how  trade secrets
• Article 8:
• Parties and representatives in litigation shall not be allowed to use or
disclose trade secrets as identified by the Court
• Court must take specific measures to protect confidentiality
• Restrict access to documents in court file
• Confidentiality club: lawyers, patent attorneys and at least one
person from each party (not likely to abuse access)
• Restricted access to hearings
• Redacted version of judgment for third parties
• Balance rights to an effective remedy and to a fair trial
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 wouter.pors@twobirds.com
 +31 653 293896
 www.twobirds.com/en/practice-areas/intellectual-property
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