Germany: Enforcing Patent Rights At German Trade Fairs: An Effective Tool Against Competitors

Last Updated: 30 August 2012
Article by Kai Rüting and Christian Paul

From a patent law perspective, trade fairs carry significant risks but also offer far-reaching opportunities. Obviously, trade fairs provide companies with a visible platform to present new products to the public and clients. In the spotlight of public attention, exhibitors will want to avoid surprises. They need to ensure that competitors do not interfere with their presentation at the fair. On the other hand, for patent owners, trade fairs are a suitable forum to take efficient steps against infringement of their patent rights.

For either side, this requires taking proactive measures and determining their strategies well in advance of the fair. In view of the large number of upcoming international trade fairs in Germany, such as IFA, Automechanica, and MEDICA, patentees as well as exhibitors should be aware of the current state of case law in Germany and the potential scenarios.

Depending on the individual situation of the patent holder, there are five different scenarios for enforcing patent rights that should be considered:

  • Border seizure prior to the trade fair to prevent exhibition;
  • Seizure to initiate criminal proceedings;
  • Inspection order to secure evidence for civil litigation;
  • Litigation against known infringers; and
  • Enforcement of obtained judgments.

Border Seizure Prior to the Trade Fair

Border seizures are a highly effective tool in Europe. Their popularity can be judged from the statistics: The number of seizures involving the violation of IP rights in 2011 increased by 15 percent compared to 2010. Even though the involved IP rights are dominated by trademarks (93 percent), border seizures  based on patents have a high strategic importance. They are frequently used not only in cases of medicines but in particular for standard relevant technologies (e.g., WiFi, DVD, etc.).

European border seizures are fast and effective for securing patent rights. Based on EU Regulation 1383/2003, a patent holder can apply for a European border seizure for infringing goods imported directly from a non-EU member state into a EU member state (e.g., from the U.S. directly to Germany). The patentee must only show that the goods are suspected of patent infringement with a sufficient likelihood. Also, the customs officers must be able to verify easily whether certain goods infringe or not.

This gives a priority to border seizures concerning patents in standard scenarios where the standard used by the product is named on the package or drugs where the protected compound is named on the package or in the leaflet.

However, other scenarios are possible if sufficient information about the infringing product is available. These might include cases of expected shipments of goods from non-EU markets.

In the context of a trade fair, border seizures carry the advantage that the infringing goods are detained before they can reach the showrooms. Because trade fairs usually take place only for a short term, even few days of detention by customs might be sufficient to hinder a competitor's presentation of a new product at the fair.

In addition to this interference effect, border seizures allow the patent holder to learn about the infringing product's origin and distribution channel. The patentee also has the opportunity to inspect detained goods and to analyze samples in order to assess infringement of the seized products. If the infringer objects to the detention, the patent holder must initiate infringement proceedings before a national civil court within 10 business days.

As an alternative to the European border seizure, a national German border seizure is applicable if the infringing goods are imported from an EU member state into Germany. The border seizure is then based on national provisions that require, as opposed to the European border seizure, that the patentee show that infringement is not merely likely but evident. Moreover, after a detention, the applicant must provide an enforceable court decision within two weeks.

For a potential infringer, it is difficult to implement effective counter-measures hindering the grant of a border seizure request, as the customs authorities do not assess in detail whether the goods actually infringe. Even though there is no established practice, previous cases have shown that declaratory actions for noninfringement or other measures in cooperation with the customs officials may lower the border seizure risk.

Seizure at the Fair Based on Criminal Law

Seizures conducted by the prosecution authorities are another effective option. Most infringers will regard the threat and the negative publicity of criminal proceedings seriously, compared with the threat of "mere" civil proceedings.

Seizures can be based on criminal law since under German law the intentional infringement of patent rights also constitutes a criminal offense. The seizure's purpose is then (i) to stop the perpetuated breach of the penal provision and (ii) to secure evidence for a criminal procedure following the seizure. A further advantage of these seizures is that they allow the detention of goods that are not officially declared at the customs authority.

The practical implementation of the procedure varies depending on the practice of local public prosecution authorities. For the Automechanica trade fair in Frankfurt, for example, the public prosecutors in Frankfurt, together with the customs authority in Darmstadt, have developed the "Darmstädter Model" as an effective non-bureaucratic way to seize counterfeited or pirated goods having their origin in non-EU member states.

Inspection Order to Secure Evidence for Civil Litigation

Inspection orders are widely used in Germany in preparation of infringement actions. They allow for the inspection of the potentially infringing item at an earlier stage in order to clarify whether there is a case of infringement. Trade fairs, particularly in international infringement settings, are well suited for such inspections: "raiding" the competitor's booth will provide access to the latest product portfolios.

A German court will grant an inspection order once the patentee shows sufficient prima facie likelihood of patent infringement. The ordered inspection is then conducted in the form of a stand-alone evidence-taking proceedings. These evidence proceedings determine de facto the outcome of the later infringement proceedings prior to the filing because (i) the expert opinion can serve as independent court expert opinion with full evidentiary value in any subsequent main proceedings, and (ii) the court decides on essential questions of infringement in formulating its decision to hand over the finalized expert opinion to the patentee. In practice, the court-appointed expert is often selected based on the proposal of the patentee.

Most German patent courts follow the so-called "Düsseldorf Model," which consists of two separate proceedings: (i) the stand-alone evidence procedure before court, as described above, and (ii) a preliminary injunction against the infringer to authorize the inspection of the infringing product. The preliminary injunction is typically granted in ex parte proceedings, i.e., without a prior hearing of the infringer. The inspection is then conducted by the expert appointed by the court and a bailiff. Typically, the patentee's attorney and patent attorney are also present to witness the inspection, provided that they have been sworn in to not disclose the information to anyone, including the patentee, before the court has ruled on any confidentiality issues that the defendant may raise after the raid.

Litigation Against Known Infringers

In case of an upcoming litigation, a patentee may use the trade fair as a platform for (i) handing over a warning letter, (ii) applying for and enforcing a preliminary injunction, or (iii) serving a complaint.

Handing Over a Warning Letter. A warning letter avoids the possibility that the plaintiff would have to bear the litigation costs in case the defendant immediately acknowledges the plaintiff's requests for a preliminary injunction or action on the merits, which quite frequently happens for infringing acts at trade fairs. The warning letter handed over at the trade fair notifies the potential infringer about the patent infringement and requests the potential infringer to cease and desist from continuing infringement, as well as to acknowledge liability for damages, setting a short deadline for voluntary compliance.

Applying For and Enforcing a Preliminary Injunction. Even thoughpreliminary injunctions ("PIs") are granted in patent matters only in exceptional cases because of the usually involved complex technical facts, the number of German PI proceedings has increased over the last years. Exhibiting an infringing product at a trade fair can serve as the basis for such exceptional case and may cause a court to grant a PI even on short notice.

A PI in patent matters needs to meet each of the following criteria:

  • There is no complex technical assessment and a clear-cut infringement is present;
  • The patentee can show urgency for its PI request; and
  • The validity of the patent is to be deemed "secure" (e.g., because the patent was affirmed in a contradictory procedure such as opposition proceedings or a nullity action, or third parties have taken a license for the patent).

Criteria supporting the likelihood of granting a PI also include: (i) imminent expiration of the patent, (ii) impending significant losses for the patentee's market position, and notably, due to their short duration, (iii) trade fairs. Usually, courts will grant PIs only after hearing the opponent (inter partes PI). Offering infringing goods at trade fairs, however, might justify in certain cases even an extraordinary circumstance for granting an ex parte PI, without hearing the defendant prior to granting the order.

From the potential infringer's perspective, the existing ex parte PI risk at trade fairs may be reduced by the filing of a protective letter ("PL") (Schutzschrift). This tool is somewhat exclusive to German civil procedure: The alleged infringer deposits the PL with court as an anticipatory defense prior to the trade fair and explains why a potential PI request would be unfounded. PLs are governed by established German case law. They are generally accepted as a preventative means against ex parte PI requests. Courts are, however, not legally bound to take the PL into account.

Moreover, it has to be noted that PLs should only be filed if they contain reasonable arguments. As outlined, in patent matters, ex parte PIs are in practice very rare and granted by courts only in extraordinary circumstances. But one of these circumstances is an unconvincing PL.

Serving a Complaint. In cases where the patent infringement situation is too complex for a PI or the patent's validity has not been reaffirmed, serving a complaint for an action on the merits at the fair can be advisable. In the case of a foreign defendant, this option permits the avoidance of the cumbersome service of process in a foreign country and is cost efficient since no translation of the complaint is required. The German court will then conduct normal court proceedings and schedule a date for an oral hearing. If the infringer does not appear in court at the hearing, a default judgment will be rendered, which can be enforced with the same legal effects as a normal judgment.

Enforcement of Already Obtained German or Non-German Judgments

Trade fairs may also provide a forum to secure previous defendants in already concluded court proceedings. Provided that a patentee is already in the possession of an enforceable judgment, the following scenarios can be considered for the trade fair:

Injunction Claim of a German Judgment. If the defendant continues with infringement by displaying an identical or only slightly amended embodiment at the booth, the patentee can apply for a PI including a confiscation order for the duration of the fair. Such PIs are usually granted ex parte. Moreover, the patentee can separately apply for enforcement procedures requesting the seizure of all infringing goods and catalogues exhibited at the booth, as well as for issuing a court order obliging the defendant to pay a penalty to the state treasury.

Damage Claim of a German Judgment. The plaintiff can also seek enforcement of payment or litigation cost claims at the fair. A bailiff can seize any goods of value at the booth, such as product samples on display or business equipment such as computers, flat screens, projectors, etc. Experience has shown that defendants often voluntarily opt for settling up their debts in order to continue their business at the trade fair rather than having their booth or goods confiscated.

Enforcement of Foreign Judgments in Germany. If foreign judgments entitling a party to claim payments are available, patentee may consider enforcing these judgments at the German fair. For this, the patentee should apply for a "declaration of recognition and enforceability" of the foreign judgment in Germany. While judgments rendered in non-EU member states require a comprehensive recognition procedure, judgments from courts in member states of the EU can profit from a simplified procedure and will not be reviewed in substance. This ensures a quick transformation in an enforceable title under German law.

Summary and Conclusion

German trade fairs provide patent owners with a platform for efficient enforcement of their patent rights. Patent owners can choose between different tools depending on the individual fact scenario. Easily detectable infringement can be prevented by initiating border seizures or criminal seizures. Complex patent litigations can be started by serving the complaint at the fair, avoiding the usual obstacles and delays due to translation and service abroad. Also, preliminary injunctions remain the tool of choice for a trade fair in suitable scenarios.

Enforcement of rights at trade shows enables fast and visible results. But it also requires proactive steps to be taken well in advance of the trade fair. Both exhibitors and patent owners should be aware of available measurements to be able to act quickly, either on the offense or defense, within the usually narrow time frame of the fair.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

To print this article, all you need is to be registered on Mondaq.com.

Click to Login as an existing user or Register so you can print this article.

Authors
 
Some comments from our readers…
“The articles are extremely timely and highly applicable”
“I often find critical information not available elsewhere”
“As in-house counsel, Mondaq’s service is of great value”

Related Topics
 
Related Articles
 
Up-coming Events Search
Tools
Print
Font Size:
Translation
Channels
Mondaq on Twitter
 
Register for Access and our Free Biweekly Alert for
This service is completely free. Access 250,000 archived articles from 100+ countries and get a personalised email twice a week covering developments (and yes, our lawyers like to think you’ve read our Disclaimer).
 
Email Address
Company Name
Password
Confirm Password
Position
Mondaq Topics -- Select your Interests
 Accounting
 Anti-trust
 Commercial
 Compliance
 Consumer
 Criminal
 Employment
 Energy
 Environment
 Family
 Finance
 Government
 Healthcare
 Immigration
 Insolvency
 Insurance
 International
 IP
 Law Performance
 Law Practice
 Litigation
 Media & IT
 Privacy
 Real Estate
 Strategy
 Tax
 Technology
 Transport
 Wealth Mgt
Regions
Africa
Asia
Asia Pacific
Australasia
Canada
Caribbean
Europe
European Union
Latin America
Middle East
U.K.
United States
Worldwide Updates
Registration (you must scroll down to set your data preferences)

Mondaq Ltd requires you to register and provide information that personally identifies you, including your content preferences, for three primary purposes (full details of Mondaq’s use of your personal data can be found in our Privacy and Cookies Notice):

  • To allow you to personalize the Mondaq websites you are visiting to show content ("Content") relevant to your interests.
  • To enable features such as password reminder, news alerts, email a colleague, and linking from Mondaq (and its affiliate sites) to your website.
  • To produce demographic feedback for our content providers ("Contributors") who contribute Content for free for your use.

Mondaq hopes that our registered users will support us in maintaining our free to view business model by consenting to our use of your personal data as described below.

Mondaq has a "free to view" business model. Our services are paid for by Contributors in exchange for Mondaq providing them with access to information about who accesses their content. Once personal data is transferred to our Contributors they become a data controller of this personal data. They use it to measure the response that their articles are receiving, as a form of market research. They may also use it to provide Mondaq users with information about their products and services.

Details of each Contributor to which your personal data will be transferred is clearly stated within the Content that you access. For full details of how this Contributor will use your personal data, you should review the Contributor’s own Privacy Notice.

Please indicate your preference below:

Yes, I am happy to support Mondaq in maintaining its free to view business model by agreeing to allow Mondaq to share my personal data with Contributors whose Content I access
No, I do not want Mondaq to share my personal data with Contributors

Also please let us know whether you are happy to receive communications promoting products and services offered by Mondaq:

Yes, I am happy to received promotional communications from Mondaq
No, please do not send me promotional communications from Mondaq
Terms & Conditions

Mondaq.com (the Website) is owned and managed by Mondaq Ltd (Mondaq). Mondaq grants you a non-exclusive, revocable licence to access the Website and associated services, such as the Mondaq News Alerts (Services), subject to and in consideration of your compliance with the following terms and conditions of use (Terms). Your use of the Website and/or Services constitutes your agreement to the Terms. Mondaq may terminate your use of the Website and Services if you are in breach of these Terms or if Mondaq decides to terminate the licence granted hereunder for any reason whatsoever.

Use of www.mondaq.com

To Use Mondaq.com you must be: eighteen (18) years old or over; legally capable of entering into binding contracts; and not in any way prohibited by the applicable law to enter into these Terms in the jurisdiction which you are currently located.

You may use the Website as an unregistered user, however, you are required to register as a user if you wish to read the full text of the Content or to receive the Services.

You may not modify, publish, transmit, transfer or sell, reproduce, create derivative works from, distribute, perform, link, display, or in any way exploit any of the Content, in whole or in part, except as expressly permitted in these Terms or with the prior written consent of Mondaq. You may not use electronic or other means to extract details or information from the Content. Nor shall you extract information about users or Contributors in order to offer them any services or products.

In your use of the Website and/or Services you shall: comply with all applicable laws, regulations, directives and legislations which apply to your Use of the Website and/or Services in whatever country you are physically located including without limitation any and all consumer law, export control laws and regulations; provide to us true, correct and accurate information and promptly inform us in the event that any information that you have provided to us changes or becomes inaccurate; notify Mondaq immediately of any circumstances where you have reason to believe that any Intellectual Property Rights or any other rights of any third party may have been infringed; co-operate with reasonable security or other checks or requests for information made by Mondaq from time to time; and at all times be fully liable for the breach of any of these Terms by a third party using your login details to access the Website and/or Services

however, you shall not: do anything likely to impair, interfere with or damage or cause harm or distress to any persons, or the network; do anything that will infringe any Intellectual Property Rights or other rights of Mondaq or any third party; or use the Website, Services and/or Content otherwise than in accordance with these Terms; use any trade marks or service marks of Mondaq or the Contributors, or do anything which may be seen to take unfair advantage of the reputation and goodwill of Mondaq or the Contributors, or the Website, Services and/or Content.

Mondaq reserves the right, in its sole discretion, to take any action that it deems necessary and appropriate in the event it considers that there is a breach or threatened breach of the Terms.

Mondaq’s Rights and Obligations

Unless otherwise expressly set out to the contrary, nothing in these Terms shall serve to transfer from Mondaq to you, any Intellectual Property Rights owned by and/or licensed to Mondaq and all rights, title and interest in and to such Intellectual Property Rights will remain exclusively with Mondaq and/or its licensors.

Mondaq shall use its reasonable endeavours to make the Website and Services available to you at all times, but we cannot guarantee an uninterrupted and fault free service.

Mondaq reserves the right to make changes to the services and/or the Website or part thereof, from time to time, and we may add, remove, modify and/or vary any elements of features and functionalities of the Website or the services.

Mondaq also reserves the right from time to time to monitor your Use of the Website and/or services.

Disclaimer

The Content is general information only. It is not intended to constitute legal advice or seek to be the complete and comprehensive statement of the law, nor is it intended to address your specific requirements or provide advice on which reliance should be placed. Mondaq and/or its Contributors and other suppliers make no representations about the suitability of the information contained in the Content for any purpose. All Content provided "as is" without warranty of any kind. Mondaq and/or its Contributors and other suppliers hereby exclude and disclaim all representations, warranties or guarantees with regard to the Content, including all implied warranties and conditions of merchantability, fitness for a particular purpose, title and non-infringement. To the maximum extent permitted by law, Mondaq expressly excludes all representations, warranties, obligations, and liabilities arising out of or in connection with all Content. In no event shall Mondaq and/or its respective suppliers be liable for any special, indirect or consequential damages or any damages whatsoever resulting from loss of use, data or profits, whether in an action of contract, negligence or other tortious action, arising out of or in connection with the use of the Content or performance of Mondaq’s Services.

General

Mondaq may alter or amend these Terms by amending them on the Website. By continuing to Use the Services and/or the Website after such amendment, you will be deemed to have accepted any amendment to these Terms.

These Terms shall be governed by and construed in accordance with the laws of England and Wales and you irrevocably submit to the exclusive jurisdiction of the courts of England and Wales to settle any dispute which may arise out of or in connection with these Terms. If you live outside the United Kingdom, English law shall apply only to the extent that English law shall not deprive you of any legal protection accorded in accordance with the law of the place where you are habitually resident ("Local Law"). In the event English law deprives you of any legal protection which is accorded to you under Local Law, then these terms shall be governed by Local Law and any dispute or claim arising out of or in connection with these Terms shall be subject to the non-exclusive jurisdiction of the courts where you are habitually resident.

You may print and keep a copy of these Terms, which form the entire agreement between you and Mondaq and supersede any other communications or advertising in respect of the Service and/or the Website.

No delay in exercising or non-exercise by you and/or Mondaq of any of its rights under or in connection with these Terms shall operate as a waiver or release of each of your or Mondaq’s right. Rather, any such waiver or release must be specifically granted in writing signed by the party granting it.

If any part of these Terms is held unenforceable, that part shall be enforced to the maximum extent permissible so as to give effect to the intent of the parties, and the Terms shall continue in full force and effect.

Mondaq shall not incur any liability to you on account of any loss or damage resulting from any delay or failure to perform all or any part of these Terms if such delay or failure is caused, in whole or in part, by events, occurrences, or causes beyond the control of Mondaq. Such events, occurrences or causes will include, without limitation, acts of God, strikes, lockouts, server and network failure, riots, acts of war, earthquakes, fire and explosions.

By clicking Register you state you have read and agree to our Terms and Conditions