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Monday, 26 January 2009

Are British patent courts unfriendly to patents?

The IPKat received a query the other day from Eric J. Siecker (Perkins), who wanted to know whether he or any of the other Kats had either any data or views on the following:

"Working as the only European Patent Attorney for a US company which is highly active in the world of patents, quite a few of my American patent attorney colleagues have the impression that the UK courts system is very patent unfriendly. Quite often I hear something like "aren't most patents that go through the courts either found invalid or non-infringed?"  I know that this is not a new view and that plenty of discussions have taken place on this subject matter. However, I would like to get a better handle on the subject and to know if that is (still) true, urban legend or a remnant of the past that may be becoming outdated?"
This member of the IPKat team does have some thoughts on the subject. He feels that many people forget that, unlike the case of the US, the proportion of patent disputes that end up in court is relatively small, since most are settled long before they see trial, and those cases that don’t settle are those where there exists the greatest area of doubt, either concerning validity or infringement. The resulting database of decided cases is in any event statistically insignificant and does not represent the body of disputes from which it is drawn. Merpel adds, the British Courts love patents to pieces -- but, as the old song goes, You Always Hurt The One You Love ...

Urban legends here

8 comments:

MaxDrei said...

I have to say, I think it is a tragedy, that this is such a widely held misperception. I suspect that those who "champion" litigation in England don't quite realise how frustrating it can be for the patent owner, everywhere else. Think of it this way:

1. Litigation ought to be a last resort

2. So only 50:50 cases should go to trial (those rare cases where both sides are genuinely still in with a shout, even as trial is imminent).

3. With 50:50 on infringement issues, and 50:50 on validity of that claim, patent owner gets to win, statistically, one time in four.

4. So if there is a jurisdiction where the patent owner "wins" at trial only one time in four, that's the perfect jurisdiction, no?

5. Then there's speed to justice. In which jurisdiction, other than England, is the first instance decision usually the end of the litigation? On mainland Europe, it marks the beginning, doesn't it?

Mind you, there is the problem of how much English litigation costs. But that unfriendliness is not to patent owners. If I see it right, the usual claimant, these days, is a party naming the patent owner as Defendant, who comes to England for its fact-finding rigour. Whether Mr Burdon's scheme gets any traction will be an indicator whether England wants the "patent owner as Claimant" business.

Rt. Hon. Lord Justice Jacob said...

Some people come here for a quick attack on a bad patent – perhaps the fastest in Europe and a way, e.g. for generics companies, to get rid of bad patents and set something of a precedent. Quite a lot of cases are revocation only.

I like to think we uphold good patents and knock down bad ones.

MaxDrei said...

Doubtless the EPO also thinks that its opposition process upholds good patents and knocks down bad ones. One can spend a mint of money there too but, here's the thing, if you don't need common law top drawer fact-finding, and if you can spare 6 years or so, then you can use the EPO to kill a patent, all over Europe, for remarkably little money. The illustrious contributer immediately above is exactly right, that Patent Offices can't help issuing some patents that are "bad" so there has to be an effective mechanism to weed them out. A choice of weed-killers is good, no? In the interests of those who need to litigate, please may we in Europe continue indefinitely to give them a choice between civil law and common law, and long may we have vigorous competition between those two procedures.

Anonymous said...

Isn't it the case in the US in particular, that only few patent litigations filed make it to trial (I hear always 3% make it to trial, the others are settled/withdrawn).

Within Europe the UK is considered a costly venue, but the US is even costlier, even when taking into account that the market/juridiction covered by the US courts is larger that the UK market/jurisdiction.

MaxDrei said...

Correct me if I'm wrong, but it is 5% in England, of the patent litigations initiated, that go through to full trial at first instance, 9 to 15 months after the litigation starts. English fact-finding and legal certainty, allow the other 95% to settle very early, or at least before they get to trial, pushed by mounting costs, as trial draws nearer. Of course, many in mainland Europe fondly suppose that the reported cases is the sum total of all there is in England, allowing them to conclude that there are orders of magnitude more patent cases in Germany than in England. The English cases that settle early are relatively cheap, especially if you are wanting an early resolution to your legal uncertainty, and your business problem.

Swedish IP guy said...

Well, the UK has "by tradition" certainly the same reputation in Sweden as reflected in the IPKat post. However, I guess that the Americans should compare the facts with other European countries. For example, a seminar held in Stockholm in December about inventive step compared some "invalidation statistics" from UK and DE so far (during 2008) that year and concluded that a higher percentage of patents had been invalidated in DE than UK in the courts. Bear in mind that DE in Sweden is seen as a very patent propriator friendly country.

Anonymous said...

Did that seminar cover novelty? Germany is in a league of its own, in its unique unfriendliness to owners of "selection" patents.

Ian Hartwell said...

Like Eric Siecker, I’ve also worked as an in-house EPA and one of my research interests is corporate IP risk management. In 2001 I did a short study here at Cranfield into causes of patent failure in the US and UK courts. The work was sponsored by IP insurers Miller Insurance and resulted in an article in the October 2002 edition of MIP. As you note, the small amount of UK data makes it difficult to draw any firm conclusions. However, the data I looked at suggested that the main cause of patent loss in the US was lack of novelty while the main cause in the UK was lack of inventive step. Patent loss due to insufficiency was about the same in both jurisdictions. The article also gives examples of the various causes of patent loss that can be useful to IP Managers when explaining IP risks to corporate management.

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