During the transitional period following the opening of the Unified Patent Court (UPC), proprietors of EP patent applications and granted traditional European Patents can choose to opt out of jurisdiction of the UPC.
Although opting out has been a popular option, with over half a million opt-out requests filed in the first 18 months of the court1, the court has also been consistently busy since opening. With nearly five years of the initial transitional period remaining (at the time of writing) the question of whether to opt out or not remains key for EP patent proprietors and applicants.
For some proprietors, initial uncertainty about the UPC was a motivation to opt out. However we now have two years of case law and procedure from the UPC which has started to address some of those concerns.
So, how should you choose whether to opt out or to keep your rights under the jurisdiction of the UPC? In this bulletin, we have provided a review of some of the points which proprietors should consider.
Central enforcement vs Central revocation (even in non-UPC states)
A proprietor needs to consider if they are likely to want to enforce their patent centrally (and so to stay under the jurisdiction of the UPC), or if they are more averse to risk of central revocation and so prefer to opt out.
For a proprietor looking to enforce their rights in a number of jurisdictions, the ability to pursue one case at the UPC to cover all of the states is beneficial, avoiding multiple separate litigations in different states.
However, proprietors concerned about revocation actions from third parties may not wish their rights to be vulnerable to the UPC’s central revocation proceedings.
It is also worth noting that, as we have reported, early case law suggests that the UPC has a long reach, with the UPC considering themselves competent to decide on infringement and validity for all parts of a European patent when a defendant is domiciled in the EU. So, UPC decisions may also have effects in non-UPC states such as Spain and the UK. Indeed, the UPC has recently issued its first UK injunction.
A recent decision has also held that the competence of the UPC extends to acts of infringement committed before the entry into force of the UPCA, including during any time period when the patent was opted out (if that opt out has been effectively withdrawn).
Keeping options open
A decision to opt out is usually not final – proprietors have the option of withdrawing an opt out to allow them to start proceedings before the UPC. However, once a third party has initiated proceedings (in a national court for an opted out right, or at the UPC for a right that is not opted out) the opt out status then cannot be changed. Proprietors might consider what they want the default status to be if a third party were to initiate an action against them.
Speed of proceedings
The UPC is aiming to make proceedings quick, seeking to make a decision on the merits within 12 months. Indications so far are that on average the court is close to achieving this for infringement and revocation actions1.
This may give parties certainty faster than an EPO opposition, but also means costs are incurred sooner. Also, parties need to be prepared to be responsive as timescales for the various stages and submissions are limited.
Costs
The cost of launching or defending an action at the UPC can be high, with costs generally being front-loaded to early in the proceedings. However, these costs may still be less overall than pursuing actions in multiple countries. If an EP patent is only validated in a small number of countries, the cost benefit of central enforcement may not be so significant.
The Unitary Patent
European patents with unitary effect (UPs) cannot be opted out of the UPC. So, a patentee who wants to have a UP cannot opt out after grant.
On the other hand, opting out during prosecution is not a barrier to choosing a UP at grant, as long as the proprietor is happy for the opt out to be withdrawn (the opt out will be deemed withdrawn when the UP is requested).
A building body of case law
The UPC’s body of case law is continually building, and has produced some decisions giving indications of how they will handle core concepts such as the doctrine of equivalents and inventive step.
Building procedural experience
As the court continues, UPC Representatives are gaining experience of how to conduct litigation at the court. You can find our article on crafting the best team for UPC litigation here.
Preliminary Injunctions
The UPC provides access to provisional measures including preliminary injunctions. The court has highlighted the need for patent holders to act quickly and provide adequate evidence to support their claims.
Summary
As always, there is no one simple answer to the question of whether to opt out or not. The balance of the pros and cons will always depend on the circumstances of the proprietor and even of the specific patent/application being considered. That said, as the case law develops we are getting a clearer view of the implications of keeping rights under the jurisdiction of the UPC, which might help proprietors with their choices.
Boult and the UPC
With over 50 UPC Representatives, the team at Boult are able to advise on UPC matters across a vast number of subject areas. If you would like to discuss any of the issues raised by this decision, get in touch with your usual Boult attorney, or email boult@boult.com.
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