Joff Wild

The UK’s ratification of the Unified Patent Court agreement moved one step closer yesterday with the confirmation that it had signed the UPC’s Protocol on Privileges and Immunities.  This provides EU privileges and immunities to the court’s judges in those countries hosting divisions of the court and signing it was a necessary step on the path to the UK’s full membership of the system.

Before ratification, there are a few other moves that need to happen and these have been neatly summarised by UK patent attorney firm Keltie. Although it looks like a few hoops still need to be jumped through, the reality is that they are largely procedural and are unlikely to be subject to any serious disruption. The anti-EU contingent in the British parliament has bigger fish to fry and is unlikely to make a song and dance about something as obscure as patents.

Talking to a UK IPO spokesman yesterday, I was told that it is anticipated UK ratification will be completed by the summer of 2017. With the German ratification process now seemingly on track, it is very possible that this time next year the UPC will – finally – be up and running. Though, as with all things UPC-related, a word of caution: things turn up and further delays would not be surprising; it is the European way!

This week law firm Kather Augenstein has provided an English language summary of some projections from the German government about UPC-related costs and also how much the system is likely to be used. According to this forecast, in its first year the court will be asked to handle around 180 cases and will only get to 2,000 a year a decade later.

It’s not known how these estimates were put together, but I cannot help thinking of the very conservative assumptions made about how often the Patent Trial and Appeal Board would be called on following its establishment by the America Invents Act. The expected trickle was actually a torrent as companies and other entities took the chance to challenge the validity of what was seen as low hanging fruit.

I wonder if the same thing will happen with the UPC: plaintiffs may feel that there are significant opportunities early on to go after particularly egregious, and perhaps underprepared, infringers. If so, the 20 part-time judges that the Germans talk about may have to be added to pretty quickly.

That said, although the UK’s surprise decision to ratify the UPC agreement means that the system is likely to be with us much sooner than had been anticipated after the Brexit vote in the referendum last June, there remains a lot of uncertainty about its future. In particular, as things stand there is no guarantee that the UK can continue to be a member after it has left the EU – whenever that may be.

There has been some legal advice that states “on balance” there is no problem with the UK staying post-Brexit, but advice is all it is. Without additional guarantees or a reworking of the agreement, it is possible that the Court of Justice of the European Union, or even the UK’s Supreme Court, may see things differently. As a result, a lot of companies will be wary of engaging with the new system until things get clearer – this certainly seem to be the  view of British industry, for example. After all, what happens if you start litigating a case only to find halfway through that your EU unitary patent is no longer valid or enforceable in the UK because the UK has pulled or been forced out of the system?     

In fact, when you think about it, this uncertainty may provide further good reason to think that there might well be a spurt of cases at the start of the UPC’s life. After all, if you feel you have a good case, you will want to get it done and dusted before Brexit happens and any problems kick in. On the other hand, clever defendants will try as hard as they can to delay things. Once the UK government invokes Article 50 – the formal notification of its intention to leave the EU – a two-year countdown begins. With this likely to happen in March 2017, and the UPC likely to be and running in November or December, that leaves a narrow window of opportunity when there will be no backlogs and eager courts chomping at the bit to get deliberating. Hold onto you hats!