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No Jurisdiction of the UPC in Case of Ineffective ...

No Jurisdiction of the UPC in Case of Ineffective Withdrawal of an Opt-Out – on the Interpretation of Art. 83 (4) UPCA and 5.8 RoP.

Dr. Cornelius Mertzlufft-Paufler Dr. Ulrike Kaufmann (née Zorr)

It has already been a year since applicants or proprietors of European patents were given the opportunity to file an opt-out request for their European application or patent during the sunrise period (between 1 March 2023 and 31 May 2023) before the UPC became operational on 1 June 2023.

By filing such an opt-out request, the applicant or proprietor would be able to withdraw their IP right from the jurisdiction of the UPC, which, according to Art. 83 (1) of the Agreement on a Unified Patent Court (hereinafter: UPCA), will co-exist with the jurisdiction of national courts for a transitional period of at least 7 years from 1 June 2023. According to Art. 83 (3) UPCA, the applicant or proprietor has this possibility as long as no action has been brought before the UPC concerning the property right.

If the applicant or proprietor wishes to make use of the new court system at a later date, he may also revoke his opt-out. Art. 83 (4) UPCA regulates this revocation as follows:

“Provided that no proceedings have yet been instituted before a national court, holders or applicants of European patents or holders of supplementary protection certificates granted in respect of a product protected by a European patent who have made use of the opt-out provided for in paragraph 3 may at any time withdraw that opt-out. In that event, they shall inform the Registry accordingly. (...)”

The revocation of an opt-out is therefore only possible if no action has yet been brought before a national court.

This ground for exclusion is also contained in Rule 5.8 of the Rules of Procedure of the Unified Patent Court:

“If, in respect of a patent or application which is the subject of a request for revocation, an action has been brought before a court of a Contracting Member State before the entry of the request in the Register or at a time prior to the date referred to in paragraph 5 in a matter over which the court also has jurisdiction under Article 32 of the Convention, the request for revocation shall be ineffective in respect of the patent or application concerned, irrespective of whether the action is still pending or has been concluded.“

In the patent infringement proceeding in view of AIM Sport Vision v Supponor (UPC_CFI_214/2023), the local division in Helsinki had to decide whether these regulations also apply to proceedings that were already pending before national courts before the UPC began its work on 1 June 2023.

The patent proprietor AIM Sport Vision had declared an opt-out for its European patent EP 3 295 663 on 12 May 2023 and then revoked it on 5 July 2023, at the same time as filing the statement of claim against Supponor before the UPC. However, the European patent EP 3 295 663 was already the subject of two national proceedings at the time the UPC commenced its work, namely an appeal proceeding against a decision of the Regional Court of Munich I and an appeal proceeding against a decision of the Federal Patent Court.

The local division in Helsinki ruled that the patentees could not revoke their opt-out and that the opt-out was therefore valid. Consequently, the UPC had no jurisdiction for proceedings based on this European patent.

The patent proprietor had argued that Art. 83 (4) UPCA could not apply to proceedings that were already pending before the UPCA came into force on 1 June 2023. Among other things, the patent proprietor had cited the wording of Rule 5.8 of the Rules of Procedure in support of its position, according to which the passage ‘for which the court also has jurisdiction under Article 32 of the Agreement’ means national proceedings initiated after 1 June 2023, since the UPC could not have had jurisdiction before then.

However, the Local Division in Helsinki disagreed with the patent proprietor's interpretation and stated that the wording of Art. 83(4) UPCA and Rule 5.8. of the Rules of Procedure did not contain any such restriction. In particular, Rule 5.8. refers to Rule 5.5, from which it follows when an opt-out becomes effective. For opt-outs requested during the sunrise period, Rule 5.12. then provides: ‘Applications accepted by the Registry before the entry into force of the Agreement shall be treated as if they had been entered in the Register on the date of entry into force of the Agreement.’ They therefore became effective on 1 June 2023. From this, the Local Chamber concludes that the proceedings referred to in Rule 5.8. also include those that were initiated before 1 June 2023.

The Local Division therefore dismissed the patent proprietor's action or request for interim measures on the basis of the aforementioned European patent due to the lack of jurisdiction of the UPC.

Against the background of this decision, patent proprietors should carefully check before initiating proceedings before the UPC whether the revocation of an opt-out is in accordance with Art. 83 (4) UPCA and thus whether the path before the UPC is open at all.

This decision emphasises the risks that arise from a premature application for an opt-out: The return to the jurisdiction of the Unified Patent Court may be barred if third parties have in the meantime brought (any) national action relating to the patent in question. The patent proprietor is then forced, if necessary, to litigate his rights abroad before less experienced courts without the direct involvement of his trusted legal counsel and - possibly - in a less familiar or accessible language.

Do you have questions about proceedings before the UPC or would you like to talk to us about opt-out strategies for your European patents? Our team of experienced patent attorneys and attorneys-at-law will be happy to assist you.