Understanding the Proposed New European Community Patent

One of the key features to come out of the EU Council's March 3, 2003 Agreement, was the creation of a jurisdictional system for the Community Patent. Part of this system will include a new court, which will become known as the Community Patent Court (CPC). The Regulation structuring the CPC still has to be redrafted and the detailed wording may yet raise many concerns that will take time to resolve. The Council must also make decisions to give the European Court of Justice (ECJ) new powers, and new peripatetic judges will need to be appointed for the CPC. Before the scheme can come into effect, it will also be necessary for the EU to accede to the Munich Convention and a Diplomatic Conference of all Member States will also be required to amend the Munich Convention. It is difficult to predict the time frame for these necessary steps, but it seems unlikely it would be less than two years, and in fact will probably take far longer as such changes usually take significant time to be implemented. For example, the revisions agreed upon at the last Diplomatic Conference to amend the Munich Convention, which took place in November 2000, are not yet in force.

The driving force behind the proposed Community Patent and the creation of the CPC is to reduce the cost of patent protection in Europe and to avoid litigation in multiple jurisdictions throughout Europe. In announcing the proposal, Internal Market Commissioner Frits Bolkestein said, 'I am pleased that the Council has today agreed, in accordance with the Commission's original proposal, that there should be a single, centralized Community Court to rule on disputes arising from Community Patents. This ensures that companies using the Community Patent would not have to run the risk of potential legal action before national courts in each and every Member State, with the legal uncertainty, inconvenience and cost that would have entailed.'

Jurisdiction Over Disputes

Dispute settlements caused the failure of the original 1975 Luxembourg Convention on the Community Patent. Unlike the present proposal, the prior Convention allowed any national court to declare a Community Patent invalid. Procedures in patent courts around Europe differ markedly. Those courts, accustomed to one system, were reluctant to acknowledge that another court's judgments, which were arrived at under a different procedural court system, were worthy of the same respect as judgments in their own system. It remains to be seen whether applicants under the proposed new system will have greater trust in the ability of the ECJ ' a court that purportedly will rise above national allegiances.

The Council is supposed to establish the CPC no later than 2010 and the CPC will have exclusive jurisdiction of issues of validity, infringement, prior rights and other patent issues. National courts will have jurisdiction over the new Community Patent until such time as the CPC is formed. A party unhappy with the CPC can appeal to the Court of First Instance (CFI) of the ECJ.

The Community Patent will not replace the national patent systems, and applicants will be able to choose between national patents, national patents granted via the EPO (which are already available) and the new Community Patent. However, it will remain impossible for one and the same invention belonging to one and the same person to be simultaneously protected by more than one patent, for example a UK patent and a European patent. If the EPO retains its present ponderous pace for examining applications there may be a continued demand for national patents and such demand may continue if only to provide applicants an enforceable right pending the grant of a Community Patent.

Changes to International Strategy

What do these recent developments mean for inventors? Immediately, they mean nothing. However, several things are apparent. The first is that a new body of law will be developed which, as of today, cannot be expected to necessarily correspond with the law with which we are familiar. For example, it is not yet known how much discovery will be permitted by the CPC during litigation. Second, the strategies used today might or might not be applicable after the Community Patent and the CPC have become available. For example, it should still be possible to file for a Community Patent and a national patent at the same time and litigate whichever patent issues first. (The bet is the national patent will still issue first). Then, for example, if the outcome is negative for the patent holder in a national court, the applicant may amend the claims in the pending Community Patent application and upon issuance ofthe Community Patent, sue again in the CPC.

The existence of a single Community Patent and court to enforce patent rights should make litigating a patent in the EU more like litigating in the United States. That is, defendants should no longer have to worry about being sued in a multitude of jurisdictions. Conversely, plaintiffs will no longer have to worry about a patent becoming a hostage to a finding of invalidity in a multitude of forums.

Conclusion

Many questions remain about this proposed new patent and the related systems. For example, will the CPC be pro-patent? Will the CFI be inclined to support or overturn the decisions of the CPC? In addition, it also remains to be seen whether the Community Patent is a less expensive alternative to currently available means of acquiring patents in Europe.

Barbara Cookson is a European patent attorney and a partner at the law firm of Nabarro Nathanson in London, England, UK. Thomas Turano is a partner in the Intellectual Property Group of the Boston law firm Testa, Hurwitz & Thibeault, LLP.

Most inventors new to the patent system express a desire for an international patent ' a monopoly good across the whole world from a single application. While it is unlikely that their desire will ever be satisfied, the prospect of being able to offer a patent throughout Europe in the form of a Community Patent may soon become reality. Such a Community Patent would be effective across all of the soon to be 25 member states of the European Union (EU).

On March 3, 2003, the Council of the European Union (EU Council) reached agreement on certain stumbling blocks, most notably, the structure of courts to try infringement and validity, and the languages to be used. The proposed Community Patent would be governed by a Regulation that is directly applicable in all member states. The Regulation will piggy back on the 1973 Munich Convention, which created the European Patent Organisation, for its substantive patent law. Applicants will apply through the European Patent Office (EPO) as they do today but may designate the European Union as one territory for the application. The EPO will examine the application in any of its existing three languages: English, French and German. Upon grant, the patentee will have to translate only the claims into each and every language used in the EU. Thus, although the Community Patent is purported to reduce the cost of acquiring and enforcing patents in Europe, conceivably the translation of the claims into each of the languages of the EU could become a significant expense. However, it is likely that the timeline for submitting the translations may be as long as two years after the official grant date.

Community Patent Court

One of the key features to come out of the EU Council's March 3, 2003 Agreement, was the creation of a jurisdictional system for the Community Patent. Part of this system will include a new court, which will become known as the Community Patent Court (CPC). The Regulation structuring the CPC still has to be redrafted and the detailed wording may yet raise many concerns that will take time to resolve. The Council must also make decisions to give the European Court of Justice (ECJ) new powers, and new peripatetic judges will need to be appointed for the CPC. Before the scheme can come into effect, it will also be necessary for the EU to accede to the Munich Convention and a Diplomatic Conference of all Member States will also be required to amend the Munich Convention. It is difficult to predict the time frame for these necessary steps, but it seems unlikely it would be less than two years, and in fact will probably take far longer as such changes usually take significant time to be implemented. For example, the revisions agreed upon at the last Diplomatic Conference to amend the Munich Convention, which took place in November 2000, are not yet in force.

The driving force behind the proposed Community Patent and the creation of the CPC is to reduce the cost of patent protection in Europe and to avoid litigation in multiple jurisdictions throughout Europe. In announcing the proposal, Internal Market Commissioner Frits Bolkestein said, 'I am pleased that the Council has today agreed, in accordance with the Commission's original proposal, that there should be a single, centralized Community Court to rule on disputes arising from Community Patents. This ensures that companies using the Community Patent would not have to run the risk of potential legal action before national courts in each and every Member State, with the legal uncertainty, inconvenience and cost that would have entailed.'

Jurisdiction Over Disputes

Dispute settlements caused the failure of the original 1975 Luxembourg Convention on the Community Patent. Unlike the present proposal, the prior Convention allowed any national court to declare a Community Patent invalid. Procedures in patent courts around Europe differ markedly. Those courts, accustomed to one system, were reluctant to acknowledge that another court's judgments, which were arrived at under a different procedural court system, were worthy of the same respect as judgments in their own system. It remains to be seen whether applicants under the proposed new system will have greater trust in the ability of the ECJ ' a court that purportedly will rise above national allegiances.

The Council is supposed to establish the CPC no later than 2010 and the CPC will have exclusive jurisdiction of issues of validity, infringement, prior rights and other patent issues. National courts will have jurisdiction over the new Community Patent until such time as the CPC is formed. A party unhappy with the CPC can appeal to the Court of First Instance (CFI) of the ECJ.

The Community Patent will not replace the national patent systems, and applicants will be able to choose between national patents, national patents granted via the EPO (which are already available) and the new Community Patent. However, it will remain impossible for one and the same invention belonging to one and the same person to be simultaneously protected by more than one patent, for example a UK patent and a European patent. If the EPO retains its present ponderous pace for examining applications there may be a continued demand for national patents and such demand may continue if only to provide applicants an enforceable right pending the grant of a Community Patent.

Changes to International Strategy

What do these recent developments mean for inventors? Immediately, they mean nothing. However, several things are apparent. The first is that a new body of law will be developed which, as of today, cannot be expected to necessarily correspond with the law with which we are familiar. For example, it is not yet known how much discovery will be permitted by the CPC during litigation. Second, the strategies used today might or might not be applicable after the Community Patent and the CPC have become available. For example, it should still be possible to file for a Community Patent and a national patent at the same time and litigate whichever patent issues first. (The bet is the national patent will still issue first). Then, for example, if the outcome is negative for the patent holder in a national court, the applicant may amend the claims in the pending Community Patent application and upon issuance ofthe Community Patent, sue again in the CPC.

The existence of a single Community Patent and court to enforce patent rights should make litigating a patent in the EU more like litigating in the United States. That is, defendants should no longer have to worry about being sued in a multitude of jurisdictions. Conversely, plaintiffs will no longer have to worry about a patent becoming a hostage to a finding of invalidity in a multitude of forums.

Conclusion

Many questions remain about this proposed new patent and the related systems. For example, will the CPC be pro-patent? Will the CFI be inclined to support or overturn the decisions of the CPC? In addition, it also remains to be seen whether the Community Patent is a less expensive alternative to currently available means of acquiring patents in Europe.

Barbara Cookson is a European patent attorney and a partner at the law firm of Nabarro Nathanson in London, England, UK. Thomas Turano is a partner in the Intellectual Property Group of the Boston law firm Testa, Hurwitz & Thibeault, LLP.