The recent judgement of the Court of Justice of the European Union in "BSH versus Electrolux" strengthens the options for cross-border patent litigation. What are the implications for the Unified Patent Court – and in which countries is an injunction now possible before the UPC?
Before the UPC, now an injunction can cover up to 39 EPC countries, provided the defendant is domiciled in a UPC Member State. For defendants outside of the EU, the jurisdiction of the UPC for injunctive relief is limited to the 18 UPC Member States.
Notably, the UPC cannot grant injunctions for third countries like the USA, even if the defendant is based in a UPC Member State. This limitation arises because the UPC is only competent for European patents and Unitary Patents.
Reflecting this framework, the UPC has in the meantime repeatedly accepted its international jurisdiction for infringement actions including the UK, Spanish, and/or Swiss parts of European patents. Relevant decisions of Düsseldorf, Milan, and Paris Local Divisions are linked in the video description.
But this raises a critical question: if the UPC is competent for infringement cases across all EPC countries, can it also decide validity? Here, a distinction must be made between EU and non-EU Member States. The UPC cannot decide on the validity of those parts of the European patent that were validated in EU Member States that aren't UPC Members. However, the UPC may stay its infringement action to wait for the outcome of pending invalidity proceedings before the national courts of those EU Member States.
With respect to those parts of a European patent validated in EPC countries which are non-EU Member States, the plot thickens: the UPC even has competence to decide on the invalidity defense with inter partes effect, meaning the scope of the invalidity decision is limited to the parties to the proceedings. Because the UPC system requires a counterclaim for revocation which has erga omnes effect, it remains to be seen how the UPC will handle such cases. Two options are conceivable: Either the UPC allows a counterclaim for revocation having inter partes effect with respect to non-EU Member States, or the UPC will accept a mere invalidity defense without a counterclaim for revocation. In parallel, defendants can initiate a revocation action before the national courts of the non-EU Member States. It is apparent that cross-border litigation is challenging: The limits of the cross-border powers of the UPC and the EU national courts, potential counteractions challenging the validity, the associated costs, and other relevant factors such as applicable law must be considered in cross-border patent litigation. For certain countries, additional regulations such as the Lugano Convention may also need to be taken into account.
For more insights into the UPC cross-border power, see our new Brochure, which is linked below. Also, in order not to miss any new important decisions of the UPC, I invite you to follow our channel and our UPC decision database.
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