Out with the old, in with the new? Procedural features of the Unified Patent Court


In our previous article, we looked at the current European system of patent prosecution and enforcement and highlighted some of the key changes that will be coming with the new Unitary Patent and Unified Patent Court (UPC) once the system is operational from 1 June 2023.

In this part two, we seek to touch on some of the interesting procedural features of the UPC. These features and their respective benefits (or limitations) may influence a patentee’s decision to opt in or out of the regime. Understanding the procedural nuances of the UPC will be critical not only for patentees but also defendants who will need to respond quickly and effectively to claims.

Please contact a member of the CMS team if you are interested in discussing this article in more detail. 

Where can I start a UPC claim?

Infringement claims can be brought in one of the following locations:

  1. The local/regional division of the UPC where the infringement has occurred.
  2. The local/regional division of the UPC where the defendant (or at least one of them) is a resident.
  3. The relevant Central Division if the defendant’s residence is outside a UPC territory.

Claimants may therefore have the ability to strategically “forum shop” depending on the location of the infringer and infringement.

Revocation actions must be brought before the Central Division unless brought as a counterclaim.

Where revocation is raised by a defendant as a counterclaim, there are three possibilities as to what happens next:

  1. Local/regional division proceeds with infringement and counterclaim for invalidity together (with the allocation of a technically qualified judge).
  2. The local/regional division refers the counterclaim for invalidity to the Central Division and either suspends or proceeds with the infringement action (bifurcating the proceeding).
  3. With the agreement of the parties, the local/regional division can refer both the infringement action and counterclaim for invalidity to the central division, to be heard together.

The Central Division has exclusive jurisdiction over declarations of non-infringement.

When will I get a decision?

The UPC will aim to get litigants to trial within 12 months of the action being started, with the court working to get a decision to the parties within 6 weeks of the trial.  This will be an attractive prospect for claimants in those jurisdictions where patent proceedings are can take several years.

However, given the UPC provides for an automatic right of appeal to appeal a UPC judgement, it is foreseeable that the appeals process will slow down the overall procedure. How quickly final decisions (and remedies) are reached will ultimately depend on the rate at which UPC decisions are considered and adjudicated on by the appeal court.

What are the key timeframes? 

Proceedings are commenced in the UPC by a claimant lodging a Statement of Claim. This is a front-loaded pleading which, in the case of a claim for infringement includes, inter alia:

  • the nature of the claim, the order or the remedy sought by the claimant;
  • an indication of the facts relied on, in particular:
    • one or more instances of alleged infringements or threatened infringements specifying the date and place of each;
    • the identification of the patent claims alleged to be infringed;
  • the evidence relied on, where available, and an indication of any further evidence which will be offered in support; and
  • the reasons why the facts relied on constitute an infringement of the patent claims, including arguments of law and where appropriate an explanation of the proposed claim interpretation.

The claimant will therefore need to do a significant amount of work upfront before a claim is brought.

The defendant then has only 3 months to respond to the case in full, including details of a counterclaim for revocation. This tight timeframe is expected to be a key pressure point for defendants, who must instruct experts, complete prior art searches and formulate a case in a very short period of time. Businesses should consider their infringement defence strategy from the earliest possible point, including proactively considering steps which can be taken prior to commencement of a claim.

What is the UPC competent to hear? 

The UPC will have a wide competence. It will be able to hear actions for infringement, threatened infringement and any related defences (including FRAND and competition issues and breach of contract if raised by a defendant). Issues related to entitlement and employee inventions disputes will remain in the realm of the national courts.

What information will I get access to or have to disclose?

There is no general duty of disclosure in the UPC nor any obligation for a defendant to produce adverse documents. However, where a party has presented reasonably available and plausible evidence in support of its claims and has, in substantiating those claims, specified evidence which lies in the control of the other party or a third party, the Court may on a “reasoned request” by the party specifying such evidence, order that other party or third party to produce such evidence. The information required to prove infringement will be an important consideration for a prospective claimant at an early stage.

For non-parties, pleadings and evidence will also only be available “upon reasoned request”.  Exactly what will be needed to constitute a “reasoned request” is unclear at this point.

What about costs?

Costs will be capped according to the value of the proceedings. See summary below:

Value of the proceedings

Ceiling for recoverable costs

Up to and including 250.000 €

Up to 38.000 €

Up to and including 500.000 €

Up to 56.000 €

Up to and including 1.000.000 €

Up to 112.000 €

Up to and including 2.000.000 €

Up to 200.000 €

Up to and including 4.000.000 €

Up to 400.000 €

Up to and including 8.000.000 €

Up to 600.000 €

Up to and including 16.000.000 €

Up to 800.000 €

Up to and including 30.000.000 €

Up to 1.200.000 €

Up to and including 50.000.000 €

Up to 1.500.000 €

More than 50.000.000 €

Up to 2.000.000 €*

*Can be uplifted to 5.000.000 €

Claimants will therefore be able to quantify with some certainty their maximum adverse costs exposure prior to commencing a claim and weigh this up against the potential up-side of pan-EU damages.  This makes the UPC a potentially attractive forum for funded litigants.

Significantly, security for costs will be available against either party.  This could present an interesting litigation tactic for claimants, depending on how readily it is awarded.  The remedy for non-compliance with an order for security is judgment in default.

With our extensive European presence and experience, CMS is uniquely placed to help our clients navigate this new system.  If you would like to explore how the UPC could impact your business, or have any other questions on the upcoming changes, please contact a member of the CMS team who will be happy to discuss this with you.