Spanish challenge to new European regime: is the Court of Justice failing to engage with the issues?

German attorney and Certified Specialist for IP Law Ingve Stjerna has written a further analysis of the current judicial scrutiny of the European Union's proposed (but not yet operative) new regime for patents.  It's "Unitary patent“ and court system – Advocate General’s Statements of Position: Superseded by reality" and you can access it via Ingve's website here.  Focusing on the Advocate General's Opinion in Case C-146/13 Spain v Parliament and Council [which, astonishingly, is still not available in English] and the implications of the most recent events at the EPO, Ingve sets the scene as follows:

On 18 November 2014, Advocate General Yves Bot‘s Statements of Position in the Spanish nullity proceedings against the two Regulations on the “unitary patent” were published, his recommendations to the Court being a rejection of the actions. Once again, the legal issues are subordinated to the political interest in the implementation of the “patent package”, however, based on a widely not very convincing argumentation. Especially the Statement in case C-146/13 largely tries to avoid any contextual debate of the critical aspects raised, e. g. in relation to the adequacy of legal protection at the European Patent Office, while contradictions and misunderstandings occur repeatedly. Not least in view of the recent events at the European Patent Office, culminating in the suspension of a Boards of Appeal member by the President, the question arises to what extent the Statements of Position can form a suitable basis for the Court’s decision at all.

Ingve's conclusion is as follows:

The presented Opinions are not convincing. When comparing them to the Opinion from proceedings 1/09, which addressed the existing problems in all their clarity, they rather seem to endeavor avoiding any confrontation with the controversial issues and to seek to easiest way to come to a rejection of the complaints. The impression arises that it is sought to achieve a predefined result, without having well-founded arguments supporting it. This may imply that a serious discussion of subject matter is possibly not wanted, because all the institutions involved anyhow wish to nod the package through.

One decisive aspect will be whether, despite the neglect in dealing with this issue in the Opinion, the CJEU will be prepared to tackle the situation at the EPO. Should they avoid this or not deal with it exhaustively, the focus will shift to the national Constitutional Courts for this examination, especially to the German BVerfG due to its mentioned powers to review ratification statutes. Since ratification by Germany is obligatory for the UPCA to enter into force, a veto by the BVerfG would stop the whole project. Already for this reason, it will be interesting to see how the CJEU will deal with Spain’s actions. Its judgments should be given in spring 2015.

PatLit looks forward to reading Ingve's comments when the CJEU finally gives its decision.

Standard Essential Patents Lose Ground

Colm Ahern

PatLit has received the following item from Spain, written by Colm Ahern (of Elzaburu, Madrid) including Colm's comment on the Advocate General's opinion on a reference to the Court of Justice (CJEU) of a case outlined in a previous post:

The Advocate General’s conclusions in Huawei v ZTE (C‑170/13) which were published today amount to a significant departure from the very strict conditions laid down by the BGH in the Orange Book case regarding standard essential patents and anti-trust law. They also vindicate the Commission’s position which has been openly critical of Orange Book. 

The Advocate General rejects the application of the rules established by the BGH in the Orange Book case, because that dispute concerned a de facto standard whereas the patent in suit concerns a standard which was agreed as part of a standardization process undertaken by the European Telecommunications Standards Institute in which both Huawei and ZTE had taken part. Huawei had agreed to provide licenses to competitors on fair, reasonable, and non-discriminatory terms (FRAND).

The BGH held that the seeking of a cessation injunction by a patent holder with a dominant position, would only constitute abuse of that position if the alleged infringer had made un unconditional and binding license offer which could not be limited to cases where patent infringement had been proven. By contrast the Advocate General places the burden on the patent holder to first send a notice letter setting out not only the alleged infringement but also the terms of license offer under FRAND conditions of a type normally used. The alleged infringer could then respond with a counter-offer setting out alternative terms. The patent holder could only seek an injunction if the counter-offer were held not to be serious and to constitute a mere delaying tactic. The alleged infringer could also reserve the right to later challenge both patent validity and the existence of infringement.

If the CJEU now accepts the Advocate General’s conclusions, the rights held by owners of SEP patents under the “Orange Book Standard” will be significantly curtailed.