Currently viewing the category: "European Patent Law"

World Bank, Washington D.C.

As everyone is aware, a new European Unified Patent Court system is in the making. The Unified Patent Court Agreement (UPCA) has been signed by all of the EU Member States but Spain and Poland and is now waiting for at least 13 ratifications (including Germany, United Kingdom, and France) in order to eventually enter into force. And, there is a fierce debate as to whether or not the effects of this new system will be beneficial.

However, there appears to be some chance that another concurrent aspect of recent developments of relevance for Intellectual Property might get overlooked.

The Transatlantic Free Trade Area (TAFTA) or Transatlantic Trade and Investment Partnership (TTIP) is a proposed free trade area between the United States and the European Union. As we can learn from Wikipedia, it was considered in the 1990s and again in 2007. In 2013, “United States-European Union High Level Working Group on Jobs and Growth” recommended the start of negotiations on the Transatlantic Trade and Investment Partnership. It represents potentially the largest regional free-trade agreement in history, covering more than 40% of world GDP, and accounting for large shares of world trade and foreign direct investment.

On 14 June, Member States gave the European Commission the green light to start trade and investment talks with the United States. Currently, the negotiations are stalled due to the U.S. Government shutdown but there is little doubt that the talks will resume as soon as Government business is re-started in Washington, D.C.

Unfortunately, the negotiations are shrouded in secrecy, and so far no meaningful conference documents appear to have been leaked. It appears, however, quite clear that TAFTA/TTIP is not negotiated to be mainly about reducing customs tariffs or the like. On the contrary, the entire project is designed as an approach to revise a huge field of national U.S. and regional EU laws with effect on trade. It might well be seen as some sort of a ‘backdoor’ to amend many established acts enshrined in the respective statute books for the sake of creating trans-atlantic level field for influential businesses.

In this very context, Zach Carter and Ryan Grim recently wrote in the Huffington Post:

[O]ne aspect of the agreement, known as “investor-state dispute resolution,” would allow a company to appeal a regulatory rule or law to an international court, most likely the World Bank. The international body would be given authority to impose economic sanctions against any country that violated its verdict, including the United States. The international body would be given authority to impose economic sanctions against any country that violated its verdict, including the United States.

A spokesperson for the Office of the United States Trade Representative confirmed to HuffPost that the agency “will seek the inclusion of procedures for expeditious, fair and transparent investor-state dispute resolution” under a new pact with the EU, but said that the new legal framework will be “subject to appropriate safeguards and the protection of legitimate government regulatory interests.”

Up to now, I do not have any insight if TAFTA/TTIP might influence Intellectual Propertly law by imposing investor-state dispute resolution procedures on Intellectual Property disputes. But there is a corresponding precedent under the NAFTA agreement:

The North American Free Trade Agreement (NAFTA) is an agreement signed by Canada, Mexico, and the United States, creating a trilateral trade bloc in North America. The agreement came into force on January 1, 1994. It also comprises clauses for investor-state dispute resolution.

In December 2012, drug giant Eli Lilly brought a NAFTA case against the Canadian government after it invalidated a patent for one of the company’s medications.

Public Citizen Inc. and/or Public Citizen Foundation reported on

In November 2012, Eli Lilly and Company initiated formal proceedings under the North American Free Trade Agreement (NAFTA) to attack Canada’s standards for granting drug patents, claiming that the invalidation of a patent violated three special investor privileges granted by the agreement. The investor privileges provisions included in NAFTA and other U.S. “free trade” agreements (FTAs) empower private firms to directly challenge government policies before foreign tribunals comprised of three private-sector attorneys, to claim that the policies undermine investors’ “expected future profits,” and to demand taxpayer compensation. Eli Lilly’s NAFTA investor-state challenge marks the first attempt by a patent-holding pharmaceutical corporation to use the extraordinary investor privileges provided by U.S. “trade” agreements as a tool to push for greater monopoly patent protections, which increase the cost of medicines for consumers and governments. Eli Lilly is demanding $100 million in compensation.

Eli Lilly launched its NAFTA attack after Canadian courts invalidated Eli Lilly’s monopoly patent rights for an attention deficit hyperactivity disorder (ADHD) drug called Strattera. The Canadian courts did so after determining that Eli Lilly had presented insufficient evidence (a single study involving 22 patients) when filing for the patent to show that Strattera would deliver the long-term benefits promised by the company. While the $100 million NAFTA investor-state compensation demand relates to revocation of the Strattera patent, Eli Lilly makes clear in its formal “Notice of Intent” to Canada that it is not only challenging the invalidation of its particular patent, but Canada’s entire legal doctrine for determining an invention’s “utility” and, thus, a patent’s validity. While pushing for an entirely different patent standard, Eli Lilly, the fifth-largest U.S. pharmaceutical corporation, is demanding $100 million from Canadian taxpayers as compensation for Canada’s enforcement of its existing patent standards.

Well, it appears as if the Elly Lilly proceedings under NAFTA rules have not been concluded yet, and no details are available with regard to the exposition of European Intellectual Propery statutes to any TAFTA/TTIP investor-state dispute resolution clauses. Hence, there is a lot of speculation. In summary, this news sound as if NAFTA may have precedence over ordinary patent law.

Could also take TAFTA/TTIP priority over ordinary EU and U.S. patent law? Perhaps even eventually forcing the EU (and, with it, EPC) to abandon the technicality requirement in the patent statues? Nobody knows for sure so far because of the negotiation documents are so sensitive that the general public may not be allowed to read them in advance.

And, of course, any disputes on the potential benefits and perils of the Unified Patent Court could well be dwarfed if TAFTA/TTIP really would render something like the World Bank into sort of an ultimate Supreme Patent Court of the U.S. and EU combined. Proper IT laws of EU and US preferably should determine IP conflict resolution procedures under TAFTA/TTIP, not vice versa. This is a proper example of a tail wagging the dog, isn’t it?

I can’t imagine that such move would be greeted in particular by SME businesses throughout the EU. Any legal certainty might be deteriorated if the World Bank could invalidate well-established national or regional law in the field of Intellectual Property by a scratch of a pen.

Be on the guard, stay tuned.

[UPDATE 2013-10-22] For more details on the Elly Lilly Case, see this article by MARC-ANDRÉ SÉGUIN on

(Photo: (C) 2006 by Shiny Things via Flickr licensed under the Terms of a CC License as documented by Wikimedia)


The patent US 7,346,545, relating to delivering copyrighted media products through a server free of charge in exchange for watching advertisements, has been enforced by Ultramercial against a number of Internet media competitors, like HuluWildTangent and YouTube. In August 2010 the 545 patent has been found invalid by a California District Court in view of the Bilski v. Kappos ruling which has been issued shortly before by the US Supreme Court (CV 09-06918). For further information on this case, please see my earlier posting here.

To be on the safe side, the District Court applied a two-stage approach, that is, as a screening filter, the CAFC’s machine-or-transformation test and then the SCOTUS abstract idea test.

The MOT test failed as the District Court found that the “mere act of storing media on computer memory does not tie the invention to a machine in any meaningful way”. Further, the Court identified “using advertisement as a currency” as the core principle of the patent, while the claims do not cite any concrete features as to how the core principle can be implemented.  

Some observers criticised the District Court’s reasoning as being capable to kill any invention where a key concept can be labelled ‘abstract’ even if the invention is clearly limited to an electronic implementation and even if the electronic implementation is central to the idea.

Now, as the Federal Circuit under Chief Judge Radar reviewed the case in appeal, it turns out that such criticism hit the mark (see decision of June 21, 2013), as the case was reversed and remanded. In its decision the Federal Circuit referred multiple times to the term “technology”, e.g.:

  • The plain language of the [patent act] provides that any new, non-obvious, and fully disclosed technical advance is eligible for protection.
  • After all, unlike the Copyright Act which divides ideas from expression, the Patent Act covers and protects any new and useful technical advance, including applied ideas.
  • Far from abstract, advances in computer technology—both hardware and software—drive innovation in every area of scientific and technical endeavor.

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One of our most successful presentations on business trips to Asia in recent years was the one about “Dos and Don’ts in European Filings” covering many practical hints that should be observed – possibly already at the drafting stage – upon filing direct EP applications with the EPO or entering the EP regional phase via the PCT route.

At KSNH we are very happy to announce that an article by my colleagues Jochen Höhfeld and Shino Tanaka summarising this lecture has been recently accepted for publication by major IP journals in Japan, China, and Korea:


JPAA Journal “Patent”, Vol.66, No.4, 2013.3, pp. 14-19


China IP News, 2013-05-31, issue 1427, p. 8 (part 1)

China IP News, 2013-06-07, issue 1429, p. 8 (part 2)


KPAA Association Journal, May 20, 2013, pages 6, 7

(see also here, No. 162  제810호, 2013.05.20)


Basically, the articles cover the following topics:

Claim Drafting

  • Limitation of number of claims
  • One independent claim per category
  • Unity of the invention
  • Reference numnerals
  • Multiple independent claims
  • Functional claim features
  • Clarity of the claim language
  • Claims in two-part-form (Jepson-type claims)
  • Claim amendments
Drafting the specification:
  • Number of pages
  • Basis for claim amendments
  • Discussion of prior art
  • Abstract
  • Incorporation by reference

Organisational issues:

  • Format of pages
  • Entering the regional phase before the EPO (Euro-PCT)
  • Regional pahse entry with the EPO acting as International Search Authority
  • Designation of the inventor
  • Divisional applications before the EPO
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U.S. President Obama signs the AIA into law on 16 September, 2011

The final package of the Leahy-Smith America Invents Act (H.R.1249, pdf) will enter into force on 16 March 2013 (for a list of amendments and their effective dates, see here). By this date, the most significant amendments of the new Act will enter into force, namely the transformation from the traditional first-to-invent regime to the new first-inventor-to-file regime.

Besides reducing the USPTO’s backlog of approx. 680.000 patent applications and improving patent quality, the main objective of the America Invents Act is to harmonise the US patent system better with international patent law standards and by that facilitate second filings of US applicants in foreign jurisdictions.

This is indeed a brilliant idea, not only for US applicants but also for European applicants and practitioners, as it will align the US system closer with the European patent system. However, event for those legal instruments that are clearly adapted to the European point of view, important differences remain. Some of those tiny differences that may have a huge impacts on practice are outlined below: 

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Will this sky-reaching architecture host substantive patent law one day?

The short answer is … we don’t know yet!

A slightly longer answer is: It will, in the end, depend on the CJEU’s own interpretation of Article 5 of the Unitary Patent Protection Regulation (UPPR) and its understanding of the nature of the Unitary Patent Court Agreement (UPCR).

And a straightforward  answer may be: Only very rarely, if at all, because of three reasons:

  1. The CJEU is not a regular third instance above the two instances of the Unified Patent Court.
  2. The centralised structure of the Unified Patent Court – involving a Central Division in the first instance and a sole Court of Appeal as the second instance – will largely ensure uniform interpretation of substantive patent law anyway.
  3. As substantive patent law is largely harmonised in Europe already and thus falls under the acte-clair-doctrine, there are only very limited  substantive patent law issues left that are in risk of being interpreted differently in different countries (or by different local/regional UPC divisions) and would thus need to be decided by a preliminary ruling according to Art 267 TFEU.

The more detailed answer. While all this may or may not be true, it still makes sense to (again) look closer into Article 5 UPPR, which has been introduced as Article 5a into the draft Regulation on the EU Council meeting of 28/29 June 2012 in exchange of former Articles 6 to 8 draftUPPR that caused so much headaches to (parts of) the profession and industry (see e.g. here and here), especially in the UK (see here). The removed UPPR articles have been introduced into the UPCA as new Articles 14f to 14i. New Article 5 UPPR and its crucial § 3 reads:

Article 5 (Uniform protection)

1.  The European patent with unitary effect shall confer on its proprietor the right to prevent any third party from committing acts against which that patent provides protection throughout the territories of the participating Member States in which it has unitary effect, subject to applicable limitations.

2.  The scope of that right and its limitations shall be uniform in all participating Member States in which the patent has unitary effect.

3.  The acts against which the patent provides protection referred to in paragraph 1 and the applicable limitations shall be those defined by the law applied to European patents with unitary effect in the participating Member State whose national law is applicable to the European patent with unitary effect as an object of property in accordance with Article 7.

4.  [...]

But what does that mean?

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Machine translation at work

The language regime as intended for the European Unitary Patent is described in the Draft Council Regulation implementing enhanced cooperation in the area of the creation of unitary patent protection with regard to the applicable translation arrangements (I take the latest known version from Document 18855/2/11 dated December 12, 2012). In Recital 11 thereof we read:

In order to promote the availability of patent information and the dissemination of technological knowledge, machine translations of patent applications and specifications into all official languages of the Union should be available as soon as possible. Machine translations are being developed by the EPO and are a very important tool in seeking to improve access to patent information and to widely disseminate technological knowledge. The timely availability of high quality machine translations of European patent applications and specifications into all official languages of the Union would benefit all users of the European patent system. Machine translations are a key feature of European Union policy. Such machine translations should serve for information purposes only and should not have any legal effect

This apperars to be, well, courageous not only because of such advanced technology is not available today but also because of it is not clear if it can be achieved anyway in any foreseeable future. Meanwhile, an interim language regime is to be created as described in Recital 12:

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While in the European Parliament the plenary debate on the Unitary Patent Package is going on, Mr Yves Bot, Attorney General in charge of joint cases C‑274/11 and C‑295/11 pending before the Court of Justice of the European Unionhas delivered his opinion: In Italian and a few not-so-common languages. However, Google might be your friend in such situations:

IV – Conclusion

163. In the light of all the foregoing considerations, I propose that the Court should:

1) dismiss the appeal;

2) order the Kingdom of Spain (Case C-274/11) and the Italian Republic (Case C-295/11) to take charge of their own costs and the Council of the European Union and the interveners to bear their own costs .

Just to remind you: Both cases have been filed by Italy and Spain, respectively, in order to challenge the decision of the EU Council to allow the instrument of enhanced co-operation provided by the Lisbon Treaty (under certain conditions disputed in the lawsuit). But Mr Bot’s Opinion is not necessarily the last word on that matter: First, the Court is free to depart from Mr Bot’s Opinion, second, at some later point in time a case might be filed allowing CJEU to have their say as to whether or not the Unitary Patent package as debated in the Parliament just this minute is compatible with EU treaties or not.

[UPDATE 2012-12-11 11:05] Meanwhile also translations in many other languages are available on-line, e.g. in English

[UPDATE 2012-12-11 13:25] Just an hour or so ago, the European Parliament has approved the Unitary Patent package:

The Rapkay report was approved by 484 votes to 164 with 35 abstentions.

The Baldassarre resolution was approved by 481 votes to 152 with 49 abstentions.

The Lehne report was approved by 483 votes to 161, with 38 abstentions.

Procedures: Co-decision (Ordinary Legislative Procedure) 1st reading (unitary patent), Consultation (language regime), non-legislative resolution (unified patent court)

Press conference: Tuesday, 11 December at 15:00


A look into the Draft Agenda for the plenary session of the European Parliament on Tuesday, 11 December 2012 reveals that the discussion and vote on the Unitary Patent Package is due:

  • #146 — Creation of unitary patent protection
    Report: Bernhard Rapkay (A7-0001/2012)
    Report on the 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
    [COM(2011)0215 - C7-0099/2011 - 2011/0093(COD)]
    Committee on Legal Affairs
  • #147 — Unitary patent protection
    Report: Raffaele Baldassarre (A7-0002/2012)
    Report on the 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
    [COM(2011)0216 - C7-0145/2011 - 2011/0094(CNS)]
    Committee on Legal Affairs
  • #148 — Jurisdictional system for patent disputes
    Report: Klaus-Heiner Lehne (A7-0009/2012)
    Report on jurisdictional system for patent disputes
    Committee on Legal Affairs

The final list of amendments tabled is available here. It looks as if this amendment #70 with some clarifications might prevail.

Also on December 11, 2012, at the Court of Justice of the EU in Luxembourg the Attorney General who is in charge of joined cases C-274/11 C-295/11 (Annulment of Council Decision 2011/167/EU of 10 March 2011 authorising enhanced cooperation in the area of the creation of unitary patent protection (OJ 2011 L 76, p. 53) Misuse of powers – Failure to respect the judicial system of the European Union) will deliver his or her Opinion. The Court might later well derive from that but the Opinion will, as usual, give a clue as to whether or not Spain and Italy might have some chance to spoil the project of enhanced co-operation in the field of patents at last.


According to the closing note at the very end of the text of the Draft agreement on a Unified Patent Court (Document 16222/12 [2012-11-14]), indication is given that the Agreement is scheduled to be signed on February 18, 2013 in Brussels. After that date, a rush to the respective national Parliaments of all of the participating Member States is attributed top priority on the agendas of the Governments; c.f. Document 16221/12 [2012-11-14] Updated draft declaration of the contracting Member States concerning the preparations for the coming into operation of the UPC agreement.

Article 59 Para. 1 of the Agreement stipulates:

Article 59
Entry into force

(1) This Agreement shall enter into force on 1 January 2014 or on the first day of the fourth month after the deposit of the thirteenth instrument of ratification or accession in accordance with Article 58a, including the three Member States in which the highest number  of European patents had effect in the year preceding the year in which the signature of the Agreement takes place or on the first day of the fourth month after the date of entry into force of the amendments to Regulation (EC) 44/2001 concerning its relationship with this Agreement, whichever is the latest.

Well, what would happen if the quorum of 13 ratifications including Germany, United Kingdom and France (i.e. the three Member States in which the highest number of European patents) is not reached in some foreseeable future due to some political misfortune? Take, for example, a purely fictional case where the United Kingdom instead of timely ratifying the Agreement holds a referendum resulting in a margin of votes in favour of leaving the EU at all (note also this and that).

In such case the Regulation of the Council and the European Parliament implementing enhanced cooperation in the area of the creation of unitary patent protection (Document 11328/11 [2011-06-23]) provides a matching clause in Aricle 22 Para. 2:

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As already reported (here and there), up to now the EU has not published the compromise proposal which was subject-matter of the discussion in JURI last Monday. The only source available to the general public appeared to be a leak originally published on the website of They simply have put a PNG graphics file on their server showing a single page comprising the wording of Article 5a (new) as well as Recitals 9 and 10 in the style on a non-paper, i.e. without any Official headings etc..

Just today, the law firm of Bardehle Pagenberg has published another version of that document comprising 3 pages in total. On page 2 thereof we find an explanation which is, in my understanding, not from Bardehle Pagenberg but from the original Cyprus non-paper. The following paragraphs might therefore shed some light on the logic behind this proposal:

  1. The proposed new Article 5a of the UPP Regulation is based on the assumption that it would seem sufficient that the UPP Regulation itself provides for the right of the patent proprietor to prevent third parties from committing acts against which the patent provides protection. These acts cover both the direct and the indirect use of the patented invention by a third party (as initially spelled out in more detail in the former Articles 6 and 7 of the UPP Regulation). The right of the patent proprietor to prevent third parties from such acts is subject to applicable limitations (as initially spelled out in former Article 8 of the UPP Regulation). The details of this right and its limitations are now determined pursuant to new Article 5a(3) of the UPP Regulation – by reference to the national law of the Member State applicable under Article 10 of the UPP Regulation of which Articles 14f to 14i of the UPC Agreement (as now amended to apply also to European patents with unitary effect, see in more detail point 3 below) are an integral part.
  2. The UPP Regulation furthermore stipulates in new Article 5a(2) that the right to prevent third parties from infringing the patent and the limitations to this right shall be uniform in all participating Member States in order to satisfy the requirement of the Regulation’s legal basis, i.e. Article 118(1) TFEU which provides for the establishment of uniform protection. This means that participating Member States are prevented from adopting in their national law provisions which would undermine the uniformity of protection.
  3. Pursuant to new Article 5a(3) UPP Regulation, uniformity of protection will be achieved by the reference to the law of the participating Member State whose law is applicable to the European patent with unitary effect as an object of property pursuant to Article 10 UPP Regulation. Implicitly this refers to Articles 14f to 14i of the UPC Agreement, which correspond to the former Articles 6 to 8 of the UPP Regulation and which define the scope of the right of the proprietor, its limitations and prior user rights. Articles 14f to 14i of the UPC Agreement which previously applied only to ”classical” European bundle patents have now been amended so that they now apply also to European patents with unitary effect. These Articles defining the scope of the right, its limitations and prior use rights will form an integral part of the national law of each participating Member State in which the UPC Agreement will come into force and for which the European patent with unitary effect will become operational.

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