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Providing evidence of trademark exploitation within new invalidity proceedings is critic
The invalidity procedure has been modified by the provisions of the “Loi Pacte” (in force since December 11, 2019) in particular with regard to its admissibility conditions, which, with respect to the evidence of exploitation of the prior trademark invoked, are twofold:
1. Proof of use of the earlier trademark subject to the obligation to use it
Article L 716-2-3 provides that, subject to inadmissibility, the owner of the earlier trademark on which the action is based must provide proof:
- if the trademark is subject to the legal obligation of use at the date of filing of the nullity action, of the serious use (or a reason for non-use) of the trademark during the five years preceding the date on which the request for invalidity was filed;
and
- if it was subject to an obligation of use on the filing date or priority date of the contested mark, of the serious use (or a reason for non-use) of the mark during the five years preceding the filing date or priority date of the contested mark.
The proof of use must therefore relate to two distinct reference periods.
The last provision may lead to a surprising situation in the event that the challenged mark is very old and the owner of the earlier mark invoked is denied his action on the grounds that he was not using his mark at the filing date of the mark whose invalidity is sought. This would result a prohibition of bringing an invalidity action even though the action is not subject to any prescription!
Finally, for the record, the proof of such use has consequences not only on the admissibility of the action, but also on the scope of the opposability of the invoked trademark, which will be deemed to be registered for each of the goods or services for which serious use has been proven or reasons for non-use have been established only.
2. Evidence of the distinctiveness of the earlier trademark for the purposes of assessing the likelihood of confusion
The new Article L 716-2-4 provides that an application for a declaration of invalidity based on an earlier trademark is inadmissible if that trademark had not acquired a sufficiently distinctive character at the filing date of the challenged trademark likely to justify the existence of a likelihood of confusion.
The question that arises is how this condition of “acquisition of distinctive character” will be assessed.
To our knowledge, no decision has defined this new condition yet, which we interpret as requiring the owner of the earlier trademark to demonstrate that its trademark has been used in such a way that the risk of confusion would have been obvious on the day the contested trademark was filed. This leads to prepare and submit a comprehensive file evidencing the notoriety of the invoked prior mark!
Particular attention must therefore be paid to the ability of the owner of the invoked trademark to prove its use and distinctiveness at these different periods.
Lavoix is at your disposal to assist you in protecting and defending your trademarks in the new invalidity proceedings.
UPC and opt-out: definition, advantages and drawbacks
The present system of European (EP) patents granted by the European Patent Office, has the drawback that the same patent, validated in several states, may lead to several parallel disputes in these jurisdictions.
The Unified Patent package creates a unitary effect for European patents encompassing the states that have ratified the Unified Patent Court Agreement (UPCA – to be found here). That is to say, an EP patent with unitary effect will have the same effects in all the states that ratified the UPCA and where said patent has been validated.
It also creates a single court (the Unified Patent Court – UPC) having jurisdiction for such European patents with unitary effect.
The Unified Patent Court (UPC)
The UPC is expected to be operational by end of 2022. (See the notification on the UPC official website).
The UPC will be a single court that will have exclusive jurisdiction for European Patents with unitary effect (UP).
During a transitional period, it will have competence for European patents or applications without unitary effect (EP), in addition to the national courts, before which actions for infringement or for revocation of European Patents or declarations of invalidity of a supplementary protection certificate can be brought, provided the UPC competence is not opted-out (see below).
By default, when the UPCA will come into force, all current European patents, which are validated in countries that have ratified the UPCA, will automatically be subject to the jurisdiction of the UPC. The same will apply to pending European patent applications and SPCs based on European patents. However, to obtain a decision in a state where a European Patent has been validated but which has not ratified the UPCA, it will be necessary to bring an action before the competent national court (Spain and Poland).
Patents which fall within the UPC system are susceptible to be challenged by third parties before this Court and, in case of revocation, the decision will apply to all UPCA member states: By a single decision, the patent will be revoked in all states which have ratified the UPCA and where the European Patent has been validated.
Jurisdiction of the UPC over granted patents or pending applications without unitary effect can be excluded by choice of the owner or applicant so that only the national courts remain competent. This is known as “opt-out”.
Opt-Out Definition
Opt-out is an option open to applicants or patentees to exclude disputes related to any of their European patents (in force or expired) or applications without unitary effect from the UPC’s jurisdiction. Thus, any action for infringement or for revocation of a European patent will be heard by the competent national courts, just like the current system.
Opt-out has effect in all UPCA Contracting Member States in which the European Patent or the application is in force and for the entire lifetime of the patent without the need to notify the opt-out separately for the relevant Contracting Member States (Article 83.3 of the UPCA).
SPCs for opted out European Patents will automatically be opted out (granted SPCs or future SPCs based on the patent). Otherwise, SPCs can be opted out separately and this must be done by the patent’s owner.
According to an Explanatory Note by the Preparatory Committee published on January 29, 2014, a competent national court would have to apply the applicable national law and not the UPCA. Whether the national courts will follow this opinion, remains to be seen.
Period to Opt-Out
Opt-out will only be available during a limited period of time: the so-called “transitional period”.
Opting out will be initially available before the entry into force of the UPC, during the preceding provisional application (‘sunrise’) period expected to start at the end of summer 2022, up until the opening of the UPC (See the Entry into force of the Protocol on Provisional Application).
During this period, the UPC Registry will be established to register opt-out requests before revocation actions can be introduced at the UPC on the first day of the system. Indeed, if a UPC action is introduced before an opt-out is entered on the register, this will inhibit any later opt-out.
Opt-out will then be available during a transitional period of 7 years, as from the entry into force of the UPC agreement (with a possibility of an additional period of 7 years which may be decided by the UPC Administrative Committee) until one month before the expiration of the transitional period. (See Article 83.1 of the UPCA). After this transitional period of up to 14 years at most, the UPC will gain exclusive jurisdiction over European applications/European patents without unitary effect which would not have been opted out.
Proceedings
The opt-out requests will have to be filed with the UPC Registry. The opt-out will become effective on the day the notification of the opt-out is received by the Registry, provided that the opted-out patent has not already been the subject of a pending litigation before the UPC. It may therefore be crucial to file opt-out request once it is available.
The opt-out must be filed on behalf of the effective owner of the application or the European patent, at the time of the filing of the opt-out application, otherwise it will be considered null and void. Co-applicants or co-patentees of an application for a European patent or a European patent will have to act in common to exercise the opt-out.
Representation by a European patent attorney or lawyer is not required for filing opt-out requests. A person instructed by the company itself, such as an employee of the company can opt-out a patent.
It will be possible to manually identify an unlimited number of patents to opt out in the UPC Case Management system (CMS website can be found here) or to use an “Application Programming Interface” that will allow a selection of patents from a database outside the CMS that will then be exported to the CMS to be opted out. This last option will allow very large numbers of patents to be opted out easily and within a short amount of time.
Pursuant to Article 83.4 of the UPCA it will be possible to withdraw such an opt-out at any time, provided that no action has been brought before a national court.
Once the application to withdraw an opt-out is registered, it should not be possible to again opt-out, according to the current draft rules of procedure of the Unified Patent Court (Rule 5 No 10 of the 18th draft).
Costs
According to Rule 370 of Procedure which deals with Court Fees and Recoverable Costs voted on 25th February 2016, there would be no official fee to opt-out, or to withdraw the opt-out .
Consequences of the opt-out
Advantages of the UPC – [Opt-out would not create an advantage]
The UPC will include technical Judges that are likely to have a better understanding of technically complex inventions and a better reasoning on patent infringement. The new Court will by definition avoid the contradictory decisions that may appear before different national courts regarding infringement.
Moreover, in case of multiple infringements in several European countries, a single action can be brought before the UPC and will have effect over all UPCA member states. Choosing the UPC will, then, significantly reduce the litigation costs in comparison with several litigations to be carried out in many countries.
Disadvantages of the UPC – [Opt-out would be preferable]
With the UPC, a European patent can be revoked in all states by a single decision. This will allow third parties or suspected infringers to efficiently challenge the validity, during the whole life time of the patents.
Moreover, the lack of feedback or case law from the UPC may make the UPC choice risky as we do not know yet the position that will be taken by the court, in particular in view of the validity of patents. Also, UPC rules and procedures are untried; it will take several years to achieve consistency in decisions.
Another element to take into account where making the choice to opt-out patents is that all proprietors of all designations of a European patent, in all states who have signed the UPC Agreement, must agree to opt out. The first complication that may arise from this rule is to identify the true proprietors of the patent, which will not necessarily be the registered proprietors, especially when patents have been assigned from a third party. Ownership should be checked, although there is no necessity to update/correct registers. The second one is the necessity for all the proprietors to join the opt-out request.
Also, if infringement is concentrated in a unique or a small number of countries, the UPC costs may be greater than proceedings before the corresponding national courts.
The protocol on the provisional application of the UPC agreement
The Protocol to the Agreement on a Unified Patent Court on provisional application (the PAP-Protocol) was initially signed on 1st October 2015 to establish a Phase of Provisional Application (PAP) to ensure « a smooth transition into the operational phase and ensure the proper functioning of the Unified Patent Court before the entry into force of the Agreement on a Unified Patent Court ».
This text is pivotal in the UPC for the practical preparation that is required to run the Court but also in terms of timing for anticipating the actual date of implementation of the Unified Patent Court Agreement (UPCA).
1. The preparatory work
The provisional application of the UPCA only concerns the institutional, oraganisational and financial provisions of the Agreement and is « limited to what is strictly necessary to ensure the smooth transition into the operational phase » (last Considering of the Protocol).
- Practically, the preparatory work includes a wide range of practical arrangements, such as :
- the set up of the IT system of the Court,
- the completion of the Case Management System,
- adoption of the Court’s budget ;
- the recruitment of the staff, including selection and appointment of the Judges, and,
- last but not least, the settlement of the premises for the Court of first instance (local, regional and central divisions in contracting states) and the Court of Appeal in Luxembourg.
The preparatory Committee reckoned that approximately 8 months are required to conclude the preparatory work needed to be done during the provisional phase.
2 . The entry into force of the Protocol
The mechanism is established in Article 3(1) of the Protocol which establishes that the Protocol will enter into force only after both the UPCA and the Protocol have been ratified by « 13 Signatory States of the UPCA including Germany, France and the United Kingdom ».
2.1 The conditions for ratification of the Protocol
The paragraphs a and b of Article 3(1) of the Protocol define two alternative conditions for the entry into force of the Protocol, and namely:
(a) either the Protocol can be « signed in accordance with Article 2(2)a. or signed, and ratified, accepted or approved this Protocol in accordance with Article 2(2)b.; or
(b) the Signatory States “declared by means of a unilateral declaration or in any other manner that they consider themselves bound by the provisional application of the articles of the Unified Patent Court Agreement mentioned under Article 1 of the Protocol.
As of today, 12 states have ratified the Protocol : France, Belgium, Bulgaria, Denmark, Estonia, Finland, Italy, Luxembourg, the Netherlands, Sweden, and lately Germany and Slovenia). Austria and Malta are expected to be the next ones and may be expected for the end of the year.
2.2 The situation of the United Kingdom
Following the Brexit and the withdrawal from the European Union, the UK withdrew from the UPCA in July 2020.
In addition to the issue of the location of the Central division to replace the London section (A.7 and Annex II of the UPCA), this withdrawal is also problematic for the interpretation of Art. 3(1) of the Protocol which mentions the ratification of the United Kingdom, although it is now out of the system.
The UPC Preparatory Committee established an authentic interpretation of Art. 3 of the Protocol, where « Art. 3 of the Protocol is to be interpreted as mirroring Art. 89 of the UPCA » (Declaration on the authentic interpretation of Art. 3 of the Protocol, yet to be signed).
A.89 UPCA defines the date of entry into force of the Agreement, based on 13 ratifications including « the three Member States in which the highest number of European patents had effect in the year preceding the year in which the signature of the Agreement takes place ».
Replacing the UK under this construction, Italy has already ratified both the Agreement and the Protocol allowing reconciliation of the wording of the Protocol with the withdrawal of the UK.
2.3 The situation of Germany
Following the action that was introduced before the German Federal Constitutional Court, an order (dated 23 June 2021) eventually cleared the way for Germany to participate in the UPCA.
Germany thus ratified the Protocol on 27 September 2021. However, Germany has not yet ratified the UPCA : It has been agreed that Germany will act as a « gatekeeper » and will only ratify the Agreement when it is clear that the UPC will be operational upon the entry into force of the UPCA.
3. The entry into force of the UPC
Assuming the Protocol enters into force early 2022, the preparatory work should be completed for fall 2022.
Before the actual running of the UPC, a three months period is first allocated for allowing patentees to opt out their European patents from the UPC jurisdiction (« sunrise period »).
Under this tentative timeline, the UPC could then be opened for business by end 2022.
Entry into force of the protocol on provisional application of the UPC Agreement (PAP)
The European Council has just indicated on its website that the Protocol to the Agreement on a Unified Patent Court on provisional application (also called PAP) has entered into force yesterday, January 19, 2022.
This follows the deposition of the ratification instruments of said protocol by Austria, which was effective January 18, 2022, making the PAP being ratified by its thirteenth member state.
As explained in a previous post, the PAP ratification triggers the existence of the Unified Patent Court (UPC) as an international organization, which is a historic landmark in the field of European IP, after so many back and forth developments.
A lot of work remains to be done before the effective operation of the UPC can start. This includes in particular obtaining budgets, selecting judges, setting in place the administrative bodies and tuning the fully paperless case management system. According to a notice published by the UPC, at least 8 months will be necessary to be able to trigger the system.
Germany will have the final word to start the system, which will occur four months after it deposits its ratification instruments of the Unified Patent Court Agreement.
The European Patent Office has simultaneously announced it will also be ready to set up the Unitary Patent which is due to start on the same day as the operation of the UPC (https://www.epo.org/news-events/news/2022/20220117.html).
New opportunities will arise with the birth of these new tools. New strategies will have to be defined for future patent protection and patent litigation in Europe.
In the upcoming months, the professional integrated teams of LAVOIX, including fully qualified European Patent Attorneys and Attorneys at Law, will be committed to develop or refresh your knowledge of the new procedures, and to help you prepare your organizations for the effective start of the UPC and of the Unitary Patent (UP), so that you are able to use the new system at its best.
LAVOIX teams will be ready to act on day one, taking advantage of our geographic position at the heart of the UPC in Paris and Munich.
We will continue to regularly update the blog with news about the progress of the UPC and UP preparations. We will also provide substantive articles about crucial subject matters such as opt-out or stay in, and various details of UP and UPC procedures.
Stay in contact with us, as a historic new era in European IP starts…
How to select the european patent with the unitary effect (Unitary Patent)
Unitary Patent a unique protection for 17 states in Europe
With the recent ratification of Austria, the European Patent with unitary effect (“Unitary Patent”) will be introduced soon.
This title enables to get a patent protection by many European states. Presently 17 states have ratified the agreement and will participate with the Unitary Patent, namely Austria, Belgium, Bulgaria, Denmark, Estonia, Finland, France, Germany, Italy, Latvia, Lithuania, Luxembourg, Malta, the Netherlands, Portugal, Slovenia, Sweden, see https://www.epo.org/law-practice/unitary/unitary-patent.html.
The Council Regulation No 1257/2012 (hereafter “Unitary Patent Regulation”) sets out the details of the unitary patent. In particular it states that only a European patents having the same set of claims in respect of all the participating Member Sates shall be able to be selected as a Unitary Patent (Art. 3 of the Unitary Patent Regulation).
Before deciding whether to apply for the Unitary Patent it should be kept in mind that it is not possible to opt-out from the exclusive competence of the Unified Patent Court (UPC) for the Unitary Patents according to §83(3) of the UPC Agreement.
Request has to be filed one months after publication of mention of grant
The Unitary Patents will be managed by the European Patent Office (EPO). For that purpose a request for obtaining a Unitary Patent has to be filed within no later than one month after the mention of the grant published in the European Patent Bulletin, see Art. 9 (g) of the Unitary Patent Regulation.
Within the same period, during a transitional period, a translation has to be filed, either an English translation for patents having the language of proceedings in French or German, or a translation into any other official language of the European Union where the language of the proceedings is English (see Article 6 of Council Regulation 1260/2012).
Definite enter into force of the Unitary Patent depends on the deposit of the UPC Agreement by Germany
Entry into force of the Unitary Patent Regulation depends on the entry into force of the UPC Agreement, see Art 18 of Unitary Patent Regulation. The UPC Agreement will enter into force on the first day of the fourth month after the deposit the final ratification, here the German ratification.
Even though Germany has already ratified the UPC Agreement, it has not yet deposited the ratification in order to enable the Unified Patent Court enough time for the preparation and the recruitment of the judges in the phase of the provisional application period, which has started mid of January.
When the State Parties are confident that the Court is functional, Germany will deposit its instrument of ratification of the UPC Agreement, which will trigger the countdown until this Agreement’s entry into force and set the date for the start of the UPC’s operations.
Thus, the definite enter into force of the Unitary Patent Regulation is unknown.
However, it is expected that it will enter into force mid 2022 to begin of 2023.
EPO proposes to delay proceedings and early request for the Unitary Patent after the deposit of the ratification of Germany
In order to give applicants the possibility to request the Unitary Patent for EP applications that are scheduled for grant between the deposit of the ratification of Germany of the UPC Agreement and the entering into effect of the Unified Patent, the EPO has just published in the Official Journal January 2022 decisions providing the Applicant with several new options.
a) For applications for which a pre-grant notification under Rule 71(3) of the European Patent Convention (EPC) has been issued, in which communication the EPO communicates to the applicant the text intended for grant, the applicant may file a request for delay of grant until the entry into effect of the Unitary Patent.
The request for delay of grant must meet several formal requirements: a corresponding form must be used and no prior agreement on the text proposed for grant must have been given yet by the applicant.
However, the applicant must still file a reply to the pre-grant communication according to Rule 71(3) EPC, i.e. pay the fees and file the translations of the claims. A request for delay filed on the same day as the approval of the text intended for grant will be considered to have been validly filed.
b) In order to facilitate obtaining the Unitary Patent, during the same period, the EPO will accept early requests for unitary effects, thus giving applicants the possibility to shift administrative work for unitary protection to before the effective date of entry of the Unitary Patent Regulation. The EPO will inform about formal deficiencies already before the entry into force of entering into effect of the Unified Patent, giving an opportunity to make corrections in due time.
Although the EPO has already communicated about these procedural measures, both possibilities are not yet in force and will be only available until the entry force of the Unitary Patent Regulation (i.e. when Germany triggers the system).
In order to reach the period from which on the EPO proposes to delay the proceedings, the applicant may request, for applications that are still in examination and a response to an Office Action has to be filed, a request for extension of the time limit to the maximum time limit.
For communications according to Rule 71(3) EPC providing with the text intended for grant, this option is unfortunately not available, the four month time limit being non extendible (except through further processing which implies costs and risks).
However, if the applicant does not agree with the proposed text, or if minor corrections are still to be made, he can file a disagreement with EPO including the respective new proposal. The EPO will then issue a new communication according to Rule 71(3) EPC, provided that the new text complies with the provisions of the EPC, so that a new four months period according to Rule 71(3) EPC starts.
Depending on the time the EPO takes to emit the new communication and on the actual date of triggering of the unitary patent system by Germany, the applicant may then be able to use the new procedures to delay the grant and request the unitary effect.
The german federal government officially ratified the UPC act of approval on august 13th
The publication of the law in the Federal Law Gazette finally puts an end to the legal complications that have been blocking the german ratification process and, consequently, the establishment of the Unified Patent Court (UPC).
But this does not mean that the UPC can finally start to operate.
Before the UPC can actually open its doors, the period of the preparatory phase must begin.
Germany intends to ratify the Protocol on Provisional Application in early autumn.
According to this Protocol, some parts of the UPC Agreement will be provisionally applied before it becomes fully effective.
In order for this Protocol to enter into force, two more Member States of the UPC Agreement will have to sign it.
The enactment of this Protocol now relies on a prompt ratification process by the courts of the Member States.
According to Alexander Ramsay, head of the UPC Preparatory Committee, there could be a functioning UPC late in 2022, or possibly early 2023 « if everything runs smoothly ».