Matthew Parker, Giving Teeth to European Patent Reform: Overcoming Recent Legal Challenges

• Jurisdiction: European Union
• Citation: Vol. 26 No. 2
• Publication year: 2010
• topic: Patent law,Intellectual Property

GIVING TEETH TO EUROPEAN PATENT REFORM: OVERCOMING RECENT LEGAL CHALLENGES

INTRODUCTION

Europe1 must transition from a national, splintered patent enforcement regime to a transnational, uniform patent enforcement regime to protect the value of European patents in the global economy. Patent reform in Europe is ongoing and supported by most member states of the European Union (“EU”),2 but objections by the European Court of Justice (“ECJ”),3 the European Parliament,4 Spain,5 and Italy6 have stymied progress. This Comment proposes modifications to patent reform in an effort to overcome these myriad objections and to enable the realization of meaningful European patent reform.

Patent reform in Europe is necessitated by the patent regime currently in place. In the contracting states7 to the European Patent Organization (“EPOrg”), consisting largely of the member states of the EU,8 patent applicants may currently choose to eschew national patent offices in lieu of a

1. For purposes of this manuscript, Europe will refer to the member states, see infra note 2, contracting with the European Patent Organization that includes, but is not limited to, member states of the European Union.

2. See Proposal for a Council Regulation Implementing Enhanced Cooperation in the Area of the

   Creation of Unitary Patent Protection with Regard to the Applicable Translation Arrangements, at 2, 4, COM (2011) 216 final (Apr. 13, 2011).

3. See Case C-1/09, Opinion Delivered Pursuant to Article 218(11) TFEU – Draft Agreement – Creation

   of a Unified Patent Litigation System – European and Community Patents Court – Compatibility of the Draft Agreement with the Treaties, 2011 ECJ EUR-Lex LEXIS 114, *37–42 (Mar. 8, 2011) [hereinafter Case C- 1/09].

4. Press Release, European Parliament, EU Patent: Parliament Postpones Vote Due to

   Council’s Last-Minute Change (July 3, 2012) [hereinafter EP Press Release], available at http://www.europarl. europa.eu/news/en/pressroom/content/20120703IPR48182.

5. See, e.g., Enrico Bonadio, The EU Embraces Enhanced Cooperation in Patent Matters: Towards a

   Unitary Patent Protection System, 3 EUR. J. RISK REG. 416, 419 (2011).

6. Id.

7. Contracting states include Albania, Austria, Belgium, Bulgaria, Switzerland, Cyprus, Czech Republic, Germany, Denmark, Estonia, Spain, Finland, France, United Kingdom, Greece, Croatia, Hungary, Ireland, Iceland, Italy, Liechtenstein, Lithuania, Luxembourg, Latvia, Monaco, Former Yugoslav Republic of Macedonia, Malta, Netherlands, Norway, Poland, Portugal, Romania, Serbia, Sweden, Slovenia, Slovakia, San Marino, and Turkey. Member States of the European Patent Organization, EUR. PAT. ORG,. http://www.epo.

   org/about-us/organisation/member-states.html (last visited Nov. 19, 2011).

8. Compare Member States of the European Patent Organization, supra note 7, with Countries, EUROPA, http://www.europa.eu/about-eu/countries/index_en.htm (last visited Nov. 25, 2012).

   single submission to the European Patent Office (“EPO”).9 This option ostensibly simplifies the patent application process when seeking patent protection in multiple contracting states. This simplification is offset, however, by the fact that applicants must also pay expensive maintenance fees for each contracting state that is designated in the application.10 In addition, patent

   protection in all contracting states saddles applicants with burdensome translation fees.11 Perhaps as a result, patent applicants typically seek patent protection in just five of the twenty-seven EU member states.12

   
   

   Apart from the upfront costs of patent prosecution, substantial costs remain if a patentee wishes to sue infringers in multiple member states. The Competitiveness Council of the EU recently admitted as much, stating that “patent litigation in Europe is fragmented and expensive.”13 This problem is

   the result of the fact that “a patent owner needs to start court proceedings in a number of different courts in order to enforce his/her European patent on the same invention throughout Europe. This creates unnecessary costs as well as legal uncertainty.”14 Despite the uniform patent prosecution process available

   in Europe through the EPO, patent infringement is litigated using the national laws and courts of each contracting state.15 The result is a patchwork of similar, but ultimately disparate, patent interpretation regimes that create differential enforcement values depending on the contracting state in which the patent action is litigated.16

   
   

   Faced with these burdens, patent reform efforts are currently underway to institute a unitary European patent enforcement regime.17 The proponents of this reform are attempting to succeed where previous, similar efforts have

   
   

9. EUROPEAN PATENT CONVENTION, art. 3, (14th ed., 2010) 13 I.L.M. 268, available at http://documents. epo.org/projects/babylon/eponet.nsf/0/7bacb229e032863dc12577ec004ada98/$FILE/EPC_14th_edition.pdf [hereinafter EPC].

10 Id. art. 79(1)–(2).

11 Id. art. 65(1)–(2).

1. Bonadio, supra note 5, at 417.

2. Memorandum 11/864 from the EU Competitiveness Council 4 (Dec. 2, 2011) [hereinafter Memorandum 11/864], available at http://europa.eu/rapid/press-release_MEMO-11-864_en.htm.

3. Id.

4. EPC, supra note 9, art. 64(3).

5. See id.

6. See generally Note from the Presidency to the Council of the European Union, 11328/11 (June 23, 2011) [hereinafter Note 11328/11], available at http://register.consilium.europa.eu/pdf/en/11/st11/st11328. en11.pdf.

   
   

   failed.18 The current reform proposes that patent prosecution through the EPO would result in an enforceable patent in each participating EPOrg contracting state without the current requirement of significant renewal and translation fees for each participating contracting state designated in the application.19 Under

   the current system, the total administrative cost, not including attorney fees, to obtain patent protection in all twenty-seven EU member states is estimated to be approximately $40,000, with translation costs accounting for about two- thirds of the total.20 The total cost would likely drop to less than $1,000 under the proposed system.21 Even more significantly, the pending reform proposes the elimination of patent litigation in national courts, where national laws are applied, in favor of a new, centralized patent court system that would apply a harmonized European patent law.22 This court system would comprise both a court of first instance as well as a court of appeal.23

   
   

   Uniformity of European patent enforcement through the harmonization of national patent law is indispensable for meaningful European patent reform. Although the harmonization of patent laws has occurred gradually in Europe, significant differences in patent interpretation remain between national

   courts.24 The proposed centralized patent court system would allow for the

   uniformity of patent enforcement by preventing disparate interpretations of a single patent in multiple countries. The certainty that such uniformity affords would add to the value of the proposed unitary European patent. Unfortunately, the ECJ has stated objections to the formation of this centralized patent court

   
   

7. See, e.g., MARTA PERTEGÁS SENDER, CROSS-BORDER ENFORCEMENT OF PATENT RIGHTS: AN ANALYSIS OF THE INTERFACE BETWEEN INTELLECTUAL PROPERTY AND PRIVATE INTERNATIONAL LAW 10

   (James Fawcett ed., 2002).

8. See Proposal for a Council Regulation Implementing Enhanced Cooperation in the Area of Creation of Unitary Patent Protection with Regard to the Applicable Translation Agreements, 2011/0094 (CNS), in Note

   11328/11, supra note 17, Annex II, 36, 38 [hereinafter Proposal for a Council Regulation, 2011/0094 (CNS)]; Proposal for a Regulation of the European Parliament and of the Council Implementing Enhanced Cooperation in the Area of the Creation of Unitary Patent Protection, 2011/0093 (COD), in Note 11328/11, supra note 17, Annex I, 10 [hereinafter Proposal for a Regulation of the European Parliament and of the Council, 2011/0093 (COD)].

9. Bonadio, supra note 5, at 416.

10. This estimate does not include the cost for obtaining patent protection in Spain and Italy, the two EU member states that have not endorsed this proposal. Id. at 419.

11. European Patent Office, Draft Agreement on the Establishment of a European Patent Litigation System 8 (2005), available at http://documents.epo.org/projects/babylon/eponet.nsf/0/F4CF2F6008160AB4C125723D 004B0707/$File/latest_draft_en.pdf.

12. Id.

13. Louise Hallenborg et al., Intellectual Property Protection in the Global Economy, in ADVANCES IN THE

    STUDY OF ENTREPRENEURSHIP, INNOVATION AND ECONOMIC GROWTH 84 (Gary D. Libecap & Marie C.

    Thursby eds., 2008).

    system as it was initially proposed.25 Although the European Council recently approved a centralized patent court system,26 debate over the role of the ECJ prompted the European Parliament to delay voting on the patent reform.27 Furthermore, Spain and Italy have refused to join the twenty-five other EU member states in the reform effort.28

    
    

    Fortunately, the concerns of the European Parliament, the ECJ, Spain, and Italy may be overcome by the proposal described herein, which outlines a method for creating uniform patent enforcement throughout Europe while maintaining the integrity of the national court systems. In Part I, this Comment will describe the development of the patent system that exists in Europe today. In Part II, it will discuss the current European patent model and its shortcomings in the global economy. Next, in Part III, it will describe and analyze the ECJ’s rejection of the proposed patent court and the European Parliament’s associated voting delay, as well as the opposition of Spain and Italy to the reform. Finally, in Part IV, this Comment will address the objections of the European Parliament, the ECJ, Spain, and Italy with both a direct rebuttal and a compromise proposal that satisfies the call for the institution of uniform patent enforcement throughout Europe.

    
    

    1. BACKGROUND

       
       

       The current patent prosecution and enforcement systems in Europe are the products of centuries of development. This Part is divided into four...