Patent litigation and implications of EU federalisation: more study needed

"The European Unified Patent Court: Assessment and Implications of the Federalisation of the Patent System in Europe" is the title of an article by Dimitris Xenos (Lecturer in Public Law and Intellectual Property Law, School of Law and Social Sciences, University of East London), which has just been published in the latest issue of the excellent online peer-reviewed IP/IT journal SCRIPTed.

The subject of the article is easily guessed from its descriptive title, which indicates that it will be of great interest to readers of this weblog -- but its content is not, with the author calling for far more rigorous and methodologically sound studies on the likely impact of the new system, given that the issues involved are so complex and cannot easily be understood by non-experts, nor even by the patent profession itself. It's worth taking a look at the author' conclusions, quoted in relevant part here:

"... Unlike the federal model of the US which the UPC tries to imitate, the European states do not form a federation. As a result, there cannot be a uniform economic policy that will influence the setting of the legal standards of patents, because the economic and technological needs and capacities of the European countries vary considerably. Another important difference is that the UPC will create a centralised institution that escapes the democratic control of the people on whom the legal standards will be imposed. Indeed, a new form of monopolistic source of legal power will be established that has no precedent in the world’s democratic political history.

... To the extent that the UPC replaces the national courts in the legal disputes relating to patents with unitary effect, the determination of patents as objects of property and the distribution of justice will mainly be made by this new source of legal power. ...[C]rucial issues of property rights and the underlying economic sustainability policies on which the future and well-being of a country depends will be decided by a body of foreign judges.

... For the large body of SMEs which do not have patents, or patents of strong market relevance, the situation can be illustrated as follows: Under the current regime when a foreign company sues a SME that is based in the UK, the case will be tried in the UK courts and in the English language. Under the UPC, the UK SME might stand as a defendant in a litigation that takes place abroad, in another language and in various judicial forums. The same applies to the majority of SMEs in other EU countries. More seriously, the legal principles against which the case will be examined will no longer by influenced by the adjusting ability of national courts.

In short, the issue of surrendering an important element of national sovereignty that concerns vital economic policies and property rights requires a comprehensive economic study about the effect that the UPC will have on local business and economy. Irrespective of whether or not the UPC is challenged in national courts (e.g. the state’s sovereign ability to determine property rights; the right to fair trial regarding the language issue in patent litigation, etc), or there is a constitutional obligation for a referendum (e.g. Ireland, Denmark), non-expert politicians and lay people cannot rely solely on an outdated study which was of limited scope that the EU Commission has presented to the states nor can they rely solely on the advice of the patent profession which benefits most from the considerable expansion of its business activities. Since the very important issue of national sovereignty in the context of patents is at stake, comprehensive and thorough national economic studies must be prepared in order for the decision-makers to make an informed choice, and the people, who will ultimately come to evaluate this choice, to be able to understand the various parameters involved".