A single patent court for Europe: Dream or reality?

• Author: Alejandro I. Garcia
• Position: Associate, Bird & Bird, U.K.
• Pages: 12-13

In

Ungar v Sugg

(1892),

Lord Esher commented

with unparalleled elo-

quence on the distress

suffered by patentees

seeking to enforce their

rights: “What, that a

man had better have

his patent infringed, or

have anything happen

to him in this world,

short of losing all his

family by influenza, than have a dispute about a

patent.” One wonders whether Lord Esher would

have found words to describe the challenges in-

herent in modern patent litigation, particularly in

an international context.

At the time that

Ungar v Sugg

was decided, inter-

national trade was based on tangible goods; as

was the wealth of countries. National authorities

granted patent rights according to the require-

ments they deemed fit – often paying little or no

attention to the practice in other countries.

Patent litigation was rare and took place in only a

handful of countries.

The 20th century, particularly its last decades, saw a

fundamental shift in most economies in the world.

Intellectual creations became the economic en-

gine of most developed countries. Developed and

developing economies became interdependent.

International trade became truly global; with the

Internet no country or player is too small. The

patent system, to some extent, adapted to this

new reality, particularly by making it easier for in-

ventors and companies to secure patent rights in

several countries at once. The 1970 Patent

Cooperation Treaty (PCT) provided a single pro-

cedure for filing patent applications in each of its

Contracting States. The European Patent

Convention (EPC), signed in 1973, provided for a

centralized patent prosecution mechanism.1

These instruments enable patentees to exploit

their IP rights on a global scale. Patent litigation,

however, has remained confined to the jurisdic-

tion of national courts.

International enforcement of patent rights may

involve legal proceedings in multiple jurisdictions

(and even proceedings within proceedings in

some countries, such as Germany), which are

generally subject to the laws of the country

granting the patent. The aggregate costs of en-

forcing patent rights in multiple jurisdictions can

be enormous. A February 2009 report requested

by the European Commission cites the average

legal costs parties must bear in patent litigation

in four countries, namely, France, Germany, the

Netherlands and the U.K.2The report estimates

that, in big commercial cases, at first instance,

party costs amount to €200,000 in both France

and the Netherlands, €250,000 in Germany and

€1.5 million in the U.K. Such costs often prevent

small and medium-sized enterprises (SMEs) from

enforcing their patent rights in all the jurisdic-

tions in which a pan-European patent infringe-

ment might take place.

Various solutions to the issue of multi-jurisdic-

tional enforcement have been put forward.

Parties to a multi-jurisdictional patent dispute

may conclude arbitration agreements whereby

they agree to resolve their dispute before a single

arbitral forum. In such “consolidated” cases, arbi-

tration is often cheaper and quicker than resort-

ing to litigation in several jurisdictions. The main

drawback of arbitration in this respect is that it re-

quires the consent of all parties involved, an un-

likely prospect in many patent infringement cas-

es. In theory, patentees may attempt to

“consolidate” a multi-jurisdictional case in a single

national court. This potential solution has been

rejected by certain national courts3and, in any

event, would bring about serious cross-border

enforcement issues.

A SINGLE PATENT

COURT FOR EUROPE

Dream or Reality?

1 At present, all European

Union (EU) countries

are EPC members, as

are some non-EU

countries – such as

Croatia, Iceland, Norway

and Switzerland.

2http://ec.europa.eu/

internal_market/indprop

/docs/patent/studies/liti

gation_system_en.pdf

3 See e.g. in the U.S. Voda

v Cordis Corp, Fed Cir

App No. 05-1238.

FEBRUARY 2010

12

Alejandro I. Garcia, Associate, Bird & Bird, U.K., practices law in England and Wales, New York and Chile,

concentrating on international arbitration and cross-border litigation of disputes involving IP, informa-

tion technology, telecommunications and complex commercial issues. In this article Mr. Garcia discusses

the imminence of a single patent court for Europe.

Resolving the issue of

multi-jurisdictional patent

litigation would require

legislative action; that is

the approach being

pursued in Europe

since 1999.

IP LITIGATION COSTS

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