22. November 2023
The Unified Patent Court (UPC) and the European patent with unitary effect (unitary patent) have entered their sixth month of operation. What is the story so far?
Let's start with unitary patents. By mid-November, over 13,000 unitary patents were recorded as converted to unitary patents on the European Patent Office (EPO) register. This is a rate of 16 % conversion of newly granted European patents, which though down on the rate nearly 25 % earlier in the year, is by many assessments high. It suggests a high degree of interest in the advantages of the unitary patent, particularly cost savings for those marketing protected products or processes in a number of European countries.
This degree of confidence in the unitary patent also implies confidence in the UPC, because unitary patents can only be enforced in this forum.
Of the unitary patents registered at the EPO, approximately 17 % are for medical technology (which is the single largest category), pharmaceuticals and biotechnology. Nearly 11 % are for computer technology and digital and telecommunication subject matter. Other popular categories of subject matter include civil engineering and 'special machines'.
Case counting in the UPC depends to some degree on database latency and whether cases are counted separately for provisional measures and main proceedings in respect of the same parties and the same patent. Just recently, the milestone of 100 cases currently proceeding before the various divisions of the UPC was reached.
About half of the cases so far concern infringement proceedings. Approximately a quarter of these cases are related to medical technologies and more than a third concern digital technology and electronics. The majority of these cases are being brought in the German local divisions, with Munich standing out as the most popular. Less than one third of the infringement cases were filed with non-German divisions.
An interesting feature of a number of these cases, is that they are part of multi-jurisdictional disputes involving several courts around the world. This includes parallel cases being fought in European national courts.
The statistics of opt-outs of European Patents from the UPC system also indicate an acceptance of the new system. Before the start of the UPC, patentees had declared to opt-out of the UPC system for approximately half of the estimated total number of European Patents in force at the time. Since the UPC has begun operation, the rate of opt-outs has stabilised around roughly 5,000 per month, compared to approximately 16,000 applications and 8,000 grants monthly. Given that a patentee can withdraw the opt-out (despite certain debatable limitations now imposed by the first-instance decision of the Helsinki Local Division), an opt-out as such is not a sign of lacking confidence in the UPC.
The international scale of some actions does not imply, however, that the UPC is only being used by multi-national patentees and their competitors. On the contrary, it is striking how many actions in the UPC are being brought by small and medium sized entities with markets that are relatively small by comparison.
The first 100 cases have also debunked the speculations that the UPC would become a niche or elite project for only certain industries or certain types of companies. On the contrary, these cases concern the full spectrum of technologies and party profiles. Not only the sectors traditionally known for active patent litigation are represented (particularly, a number of life sciences and standard essential patent (SEP) actions were filed) but also engineering and even the fashion (leather printing) industry have already adopted the UPC.
In addition to the large number of cases being filed in the UPC, which is more than many had anticipated, this broad appeal will be a relief to the architects of the system. It has always been argued that the UPC is designed to be attractive to patent owners of all sizes, and the first cases suggest that this is indeed how it is being used. But, the fact that so many household name companies are also using the court will be seen as a mark of confidence in the system.
With more than 100 cases of a broad spectrum filed within the first sixth months, the UPC has arguably already a recognized role as new and – likely increasingly important – patent litigation venue.
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