Key Takeaways From the Unified Patent Court’s First Year | France

On 1 June 2023, after a series of abandonments, postponements and other twists and turns, the Unified Patent Court (UPC) opened its (many) doors. After a year in operation, it is time to take stock, in figures and trends.

The UPC is a fee-paying international court of private law (not a European Union court), common to 17 EU member states (other member states may join – see below). This court has exclusive jurisdiction over patents with unitary effect (or unitary patent), which are also newly-created industrial property titles, enabling protection to be obtained in the countries of the European Union (currently 17 and up to 25). The UPC also hears cases relating to “classic” European patents, with an exception for a transitional period of seven years during which actions concerning “classic” European patents can still be brought before national courts or other competent national authorities. In addition, “classic” European patents may be subject to an opt-out clause from the UPC system.

The UPC has a unique organisational structure, with central divisions in Paris, Munich and Milan (recently appointed after the post-Brexit withdrawal of the London division), each with its own technical field, and regional/local divisions in various countries (France, Germany, Italy, Belgium, the Netherlands, Denmark, Sweden and Lithuania, Latvia and Estonia (“Nordic Baltic” regional division), Finland, Austria, Portugal and Slovenia (the latter two countries also host mediation and arbitration centres set up in the context of the UPC). The Court of Appeal is based in Luxembourg, and final appeal lies to the Court of Justice of the European Union. The UPC’s judging divisions are made up of specialised judges at first instance and on appeal (including technically qualified judges when validity of the patent is at stake).

According to the figures published by the UPC on 31 May 2024, the court has received 373 cases in its first year of operation, which a number of observers have seen as rather (or even very) encouraging. Of these 373 cases, 134 were patent infringement actions and 165 were counterclaims for patent invalidity (and of these 165, 63 stemmed from infringement actions). The UPC also had to deal with 27 requests for injunctions and five requests for “saisie-contrefaçon” (means of evidence specific to this field).

Large groups, particularly in Europe, have rapidly integrated the UPC into their legal strategy, as this court can be seen as an additional string to their bow, notably due to its extended geographical reach, which makes it a definite lever in the context of a litigation power struggle. Mid-sized companies and SMEs also seem to have adopted this new court, both as plaintiffs and defendants, as have NPEs (Non-practising Entities), which have already been able to initiate some proceedings.

In its first year, the UPC has seen the launch of legal actions in the fields of information technology, telecoms, life sciences, pharmaceuticals, medical devices and mechanical engineering, notably for consumer products.

The data published by the UPC confirms a long-anticipated trend: the predominance of German divisions in the volume of UPC litigation. Of the 134 infringement actions mentioned above, 54 were brought in Munich (local division), 27 in Düsseldorf, 16 in Mannheim and seven in Hamburg, compared with ten in Paris (local division), four each in Milan and The Hague, two in Brussels and one each in Helsinki, Copenhagen, Vienna and Paris (central division).

For a time, Germany also topped the podium of procedural languages used before the UPC. However, as a result of practice and some of the decisions handed down by the UPC in that first year, the English language has since come to predominate before the court, and now accounts for 50% of the proceedings. Given that the majority of European patents, including those with unitary effect, are filed and granted in English, this trend is set to continue. German accounts for 44%, while French, Italian and Dutch each account for 2%.

Transparency, and in particular third-party access to written pleadings, has been a key issue during the UPC’s first year of existence. While the first instance divisions refused several times to grant access to documents, the UPC Court of Appeal provided useful guidance as to the availability of written evidence and pleadings to the public upon “reasoned request”. The move towards greater transparency through third-party access to the file must be taken into consideration by parties involved in UPC litigation.

The UPC system is largely based on the new unitary patent, and the figures show that this new title has found its audience: according to the EPO, as of 11 June 2024, 28,334 European patents had been granted, mainly in the fields of medical technology (12%), civil engineering (5.7%), measurement technology (5.4%) and transport (5.3%).

By the end of 2024, the first decisions on the merits of the UPC will have been handed down, and its jurisprudence will be shaped with greater precision. Questions regarding transparency and the composition of the courts are likely to give rise to further reflection.

Romania deposited its instrument of ratification of the UPC agreement on 31 May 2024, thus becoming the 18^th EU member state to ratify the agreement, which will come into force on 1 September 2024. In Ireland, the referendum on the UPC agreement originally scheduled for 7 June 2024 has been postponed.

The new unitary patent/UPC system has begun to prove its worth, and has already been adopted by the stakeholders. This system needs to be integrated into the patent/R&D strategy of companies, who need to prepare themselves in advance for the highly demanding procedure before this new court.