Tuesday, 12 May 2015

Draft proposal unified patent court fees available

A draft proposal for the fees that will be applicable to the unified patent court has been published. At the same time a public consultation round has started.

As expected some of the fees for the unified patent court are quite a bit higher than the fees of some national courts. For example, an infringement action would set you back 11.000 euro.
It is one of the goals of the system that the new court will be self-supporting financially. Much like the EPO is, at the moment.  So, the level of the court fees does not seem to be up for discussion. According to the document: "The fee levels suggested are the lowest that will enable sustainability of the Court."

The document offers two different alternatives that mainly differ how costs can be reduced for smaller parties. In the first alternative, costs are reduced by allowing various fee reductions for 'good behavior', e.g., settling, especially early settling, having only one judge.

In the second alternative certain categories of applicants get a fee exemption. Eligible applicants include small and medium-sized enterprises, non-profit organizations, public research organizations, and university.

In both alternatives, the court can reimburse the fees if "the economic existence of a party who is not a natural person" is threatened due to the amount of payable Court fee.

I'm not a big fan of the reduced fees for some applicants, as the fee reduction is may be less than the additional administrative overhead. In this case however, a fee reduction of 11.000 euro (or more if the value of the patent is high) would be a significant part of a small infringement case. I'm guessing that these rules may very well have a real impact on how the court is used.

There is one thing that I wonder about. When accused of infringement, a standard defense would be to raise a counterclaim for revocation. In the draft proposal such a counterclaim would cost the same as the infringement claim, i.e., 11.000 or more (with a cap of 20.000 euro). I suppose that you can still raise non-validity of a patent as a defense against infringement, even without filing a counterclaim--you can't infringe a non-valid patent. But if parties fail to file a counterclaim due to costs, the result would be that the patent remains in force, even if the judge considered it to be invalid. This seems to be a less than ideal situation.

Responses to the public consultation should be filed before midnight on the 31 July.

1 comment:

  1. According to Rule 25 of the UPC Rules of Procedure (17th draf), if the statement of defense asserts that the patent is invalid, it "shall include" a counterclaim for revocation. So, as I understand it, the defendant either files a counterclaim for revocation and pays the fee (Rule 26) or must accept that the patent is considered to be valid. (In the latter case he would probably still benefit if the EPO, or the UPC in a parallel case, revokes the patent.)

    What may save the innocent infringer of a plainly invalid patent is that the successful party may request a cost decision, which also covers court fees. But in cases that are not so clear a small defendant might prefer to pay for a license rather than risk having to pay the court fees and, likely worse still, the representation fees for both sides.

    The other way around is interesting as well: if a small party owns a patent and is confronted with a revocation action, things could get quite costly if the party does not eventually win the case. So it might be safer to give up the patent immediately, but that might still not be enough to avoid a cost decision which might not only cover court fees, but also the costs of preparing the revocation action.

    Of course I might just be showing my lack of familiarity with national infringement and revocation proceedings. UPC court fees might be higher, but for the rest not that much might change?

    Who can start a revocation action? "Any person" as in Art. 99 EPC? Or is some kind of legitimate interest required?

    Does Rule 30(1)(a) not conflict with Art. 138(3) EPC as regards the possibility of amending the description?

    Btw, I hope some professional legal writer will eventually clean up the linguistic mess that is now the draft Rules of Procedure of the UPC. For example R. 30: "of the claims of the patent concerned and/or specification". But almost everything is much too wordy and convoluted.