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4 June 2024NewsMarisa Woutersen

Looking back at the UPC’s ‘successful’ first year

Court seen as “exceeding expectations” | Experts urge caution, emphasising that confident and reliable court judgments are needed | High-stakes patent litigation, especially in pharmaceuticals, remains predominantly within national courts.

As the Unified Patent Court (UPC) celebrated its first anniversary on June 1, new data confirms that the pharma and tech industry are dominating cases at the venue.

Since its official start on June 1 2023, the UPC has received a total of 373 cases.

These cases include various types of patent disputes, including infringement actions and counterclaims, provisional measures, and revocation actions.

The Unitary Patent system had more than 27,500 patents registered for unitary effect.

Leading the requests for Unitary Patents since June 2023 are pharma and tech industry giants Johnson & Johnson, Siemens, Samsung, Qualcomm, and Ericsson.

In its first year, almost one in four patents granted were converted into Unitary Patents at the request of the proprietors, reported the European Patent Office (EPO), on June 3.

Notably, a significant portion of these patents—around two-thirds—originated from within the EU, resulting in a 24% uptake rate in 2024 alone.

Popular in ‘enforcement context’

Sebastian Moore, partner and head of IP UK at Herbert Smith Freehills said: "The UPC has had a successful first year, proving to be particularly popular in the enforcement context.”

“This is not surprising, given the possibility of obtaining relief in 17 contracting countries,” he continued.

Antje Brambrink, partner at Finnegan said: “Since its launch one year ago, the UPC has attracted many litigants across industries. The consistently increasing caseload shows the still growing attractiveness of this new venue.”

According to Moore, the UPC has “efficiently” handled interlocutory applications, and several Court of Appeal decisions have clarified key issues—including the threshold for obtaining preliminary injunctions and the conditions under which non-litigants can access documents filed in the proceedings.

“The numbers show the great success the new court has achieved within the first year. It will be interesting to see the further development in the future, in particular, whether the focus on the German divisions and the technical distribution will remain unchanged,” noted Brambink.

"We await to see the outcome of the first main action proceedings this year. So far, the UPC has exceeded expectations," added Moore.

Demand for Unitary Patents surpasses expectations

Leading the requests for Unitary Patents since June 2023 are pharma and tech industry giants Johnson & Johnson, Siemens, Samsung, Qualcomm, and Ericsson.

The demand for the Unitary Patent extends beyond the 17 participating EU member states, reaching patentees across Europe and globally.

In its first year, 64.2% of Unitary Patents were registered by patentees from Europe (39 EPO member states), followed by the US (16.1%), China (6.0%), Japan (3.8%), and the Republic of Korea (3.3%).

Matt Dixon, president of the Chartered Institute of Patent Attorneys and counsel at Cranach Patent Attorneys, said the uptake of Unitary Patents has “exceeded our expectations” with a UP chosen for one in four granted European patents.

“We’ve been delighted to see so many cases before the court and so many UK patent attorneys representing clients in both infringement and revocation actions.”

According to Dixon, the landscape of European patent litigation is “definitely changing”, as the courts and representatives spread out across Europe.

Infringement claims and counterclaims

The UPC has seen 134 infringement actions filed to date.

The number of total infringement actions (134) compared to that of standalone revocation actions (39) reveals that this court is currently a place for patent holders, according to Brambrink.

Of these 134 infringement actions, 54 were submitted to the Munich local division, 27 to Düsseldorf, 16 to Mannheim, 10 to the Paris local division, and seven to the Hamburg division.

The Nordic Baltic regional division received six infringement actions.

The local divisions in Milan and The Hague each saw four infringement actions, while Brussels received two.

The Helsinki, Copenhagen, Vienna, and Paris central divisions each received one infringement action.

From a technical perspective the infringement actions focus still on disputes over electrical patents (50 cases in patent class H) followed by life sciences (30 cases for class A “Human necessities”) and mechanics (21 cases in class B “Performing operations and transporting”) as well as physics (19 cases in class G).

With regard to forum shopping, the strong focus on the German divisions—which was already detected when the court launched—still remains unchanged, explained Brambrink.

In addition to infringement actions, the court has processed 165 counterclaims for revocation related to 63 individual infringement actions.

This high number of counterclaims is due to the previous rule that required each defendant in an infringement case to file a separate claim for revocation.

The court has also received 32 applications for provisional measures, which include requests for preserving evidence and orders for inspection.

The Paris central division received 35 revocation actions, while the Munich central division saw four revocation actions filed.

UPC's caseload ‘impressive’ but lags behind national courts

Nicholas Fox, partner at Mathys & Squire, argued that “the UPC still has a long way to go before it becomes Europe’s primary court for patent litigation”>

The UPC’s caseload was slightly ahead of the French courts, which heard 174 patent cases in 2021, and was a long way behind Germany, which heard 841 patent cases that year.

However, very few UPC cases have yet to reach any form of conclusion.

While a steady stream of substantive decisions from the UPC is expected over the next 12 months, said the firm, these will initially be first-instance rulings.

The new court's approach to substantive patent law will only become clear once a significant number of cases have been decided or referred to the UPC Court of Appeal.

In its first year, the UPC handled 39 stand-alone revocation actions, a stark contrast to the 3,775 oppositions filed at the EPO in 2022, a trend likely to continue according to Mathys & Squire.

Confidence in UPC's judgments crucial for long-term success

Fox said that while the UPC’s success is “notable”, it should not be “overstated”, as most businesses continue to prefer to litigate at a national level.

“For the UPC to become Europe's hub for patent litigation, it must demonstrate the value of continent-wide litigation to patent owners,” explained Fox.

Fox also noted that both corporates and lawyers need to gain confidence in the UPC's ability to deliver predictable and robust judgments, as high-stakes patent litigation, especially in pharmaceuticals, remains predominantly within national courts.

Looking to the second year of the court, Dixon agreed that the most important thing to look out for is the quality of the decisions made by the judges.

“It’s going to be crucial for the long term success of the court that the judges are seen to make sensible decisions. Patentees are going to want to be reasonably confident that they can predict the outcome of a case.

“They want reliable judgments,” he urged.

He predicts greater use of the court from outside Europe, as patentees gain confidence in the system, while others predict that the UPC could become the preferred forum for global patent litigation.

“That would be great for our patent attorneys, but I think we shouldn’t get ahead of ourselves at this stage,” concluded Dixon.

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More on this story

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9 May 2024   A significant uptake in unitary patents show court is here “in a big way” | Speakers shed light on the UPC's approach to preliminary injunctions and evidence gathering at LSPN Spring in Boston.
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9 May 2024   10x Genomics injunction showed the need to take the court ‘really seriously’ says US lawyer | With a focus on efficiency and plaintiff-friendly measures, the UPC's impact on patent valuations and litigation strategies is becoming increasingly apparent, at LSPN Spring.