Legality of UPC opt-out fees: Ingve is not alone

Verdict on the UPC opt-out fee ...?

Yesterday PatLit drew the attention of readers to this article by German IP practitioner and scholar Ingve Stjerna on the doubtful legality of the proposal to charge prospective patent litigants in Europe for exercising their right to opt out of using the Unified Patent Court (UPC).  Well, it seems that Ingve is not alone.  This blogger has now learned that Benedikt Migdal, of leading British IP practice Bristows, has also questioned the legal basis for this fee on the Bristows UPC Blog, here.

PatLit agrees that the legality of the opt-out fee should be carefully reconsidered. Apart from its plainly dubious legal basis, it is surely wrong in principle and does, as Ingve indicates, suggest that those responsible for the UPC have little confidence in its attractiveness to users if it has to penalise them for not using it.

The Unified Patent Court and pay-to-opt-out: a critical analysis

If only it were so easy!

From our friend and German intellectual property attorney Ingve Stjerna comes information that he has now had the chance to take a closer look at the planned fee for an opt-out from the competence of the Unified Patent Court; he has thoughtfully summarised his findings with regard to the proposal's legality in "“Unitary patent” and court system – Urgently needed: A legal basis for the opt-out fee", a highly readable four-page paper which you can read in English or in German.

What is the outlook for European patent litigation in light of the planned fee structure? Ingve explains:

The approach of trying to foster the adequate utilization of a newly created court system by making the use of a concurrent judicial competence dependent on the payment of a fee does not really show great trust and confidence of the Contracting Parties as to its expected acceptance. Vice versa, this feeds and increases the skepticism among the users.

This approach becomes fully bizarre as regards patents and patent applications which were granted or applied for prior to the entry into force of the UPCA and thus at a time at which the new court system which they are now meant to be subjected to retroactively, has not even been existing. Such protective rights stand under the previous regime of legal protection, this should continue to be available for them free of charge.

Already due to these manifest doubts in the lawfulness of an opt-out fee under constitutional law its collection should be abstained from entirely, all the more since the confidence in the Unified Patent Court expressed by such step would be an important signal to the user circles. However, this is not to be expected. Therefore, the constitutionality of such fee and of the Agreement purportedly providing for its collection may possibly have to be discussed in the future.