For the half-year to 30 June 2014, the IPKat's regular team is supplemented by contributions from guest bloggers Alberto Bellan, Darren Meale and Nadia Zegze.

Two of our regular Kats are currently on blogging sabbaticals. They are David Brophy and Catherine Lee.

Thursday, 3 November 2011

Welcome to London: Home of the Unified Patent Court?

London often looks like this
after a couple of pints of Badger
Readers will have noted Merpel’s fuzzy little head popping up yesterday, speculating on which meritorious location will house the new Unified Patent Court. Like Merpel, the AmeriKat’s limited time for idle speculation has also been focused on its whereabouts. Merpel and the IPKat, being consummate Europeans, do try to be diplomatic and discreet in what they say. The AmeriKat however is under no such constraints. As an American who is proud of her constitutional heritage of Freedom of Speech, and as a happy outsider who has settled comfortably into the United States of Europe, she is more inclined to throw caution to the wind and tell it the way she sees it. And what does she say? Why, there is only one obvious choice, her very own adopted home -- London!

Many cricket games now last longer
than Patent Court hearings ...
The AmeriKat’s whiskers sense that some dear readers are now up in arms at such a statement. “It's expensive! Its anti-patent! Its…its…well, its English!” she hears you say. If that is the extent of the opposition against London, the AmeriKat need not invest much energy in countering such meritless arguments. Yes, it's true - the weather has schizophrenic qualities, the English emotional stoicism can be impenetrable and the whole cricket thing remains shrouded in mystery. But these peculiarities add only charm to the numerous concrete signposts that point to London being the only obvious and logical home of the new Unified Patent Court.


1. Already the patent litigant’s venue of choice


The choice of a woman to hold
the Scales of Justice reflects
national policy on Equal
Opportunities
Whether a patentee or an infringer, parties contemplating a visit to court will usually try to avoid litigating in a jurisdiction where they are destined to lose. In such jurisdictions you would expect to see the number of patent cases to be few. The sheer number of patent cases filtering through the UK courts in the past several years debunks the antiquated (and exaggerated) myth that the UK and the UK courts were/are anti-patent. A quick glance over the reported Patents Court cases in the past five years in fact shows that, of the cases reaching the main IP court, a substantial majority are patent cases -- an the proportion of cases in which patent owners have succeeded has risen too.

In the intervening years, pending the adoption of a Community patent, where litigants have had a choice of forum, the UK courts have become the obvious venue of choice for litigants and practitioners -- European and foreign alike. The choice has been justified by litigants who point to the impartial court system (see below), the equal weight afforded to patentees and defendants, the high quality decisions and the speed of the system and litigation support, leading from trial to first instance judgment in 6-12 months.


2. It has the people


Besides New York (which is sadly not an option), London is the largest and most important financial market in the world. Say what you want about the current state of affairs in the world’s financial markets but, where there is strong financial center, therein follows innovation and expertise – expertise that is found in the UK’s judiciary, its experienced practitioners, and litigation support services.

After a busy day in court, judges
amuse themselves by playing
dressing-up games
The UK’s judiciary is respected throughout the world for its independence, experience and skill and -- unlike some civil law systems -- there is no career judiciary in the UK. British judges, and especially the IP-specialist judges, are recruited from the cream of the country's senior legal practitioners; the IP judges' resumes speak for themselves, showing their legal and technical qualifications (the majority have a background in the sciences, enabling them to quickly tackle complex patent issues - see here, here, here , here, and here). London is also home to the biggest international law firms and European headquarters of the world’s biggest companies and patent holders. As such, London has become Europe’s largest legal center and with it ,an all-encompassing and extensive network of litigation support services. You can barely walk down Chancery Lane without tripping over gaggles of transcribers or experts (it is a gaggle of transcribers, right?). (picture, left - our esteemed Supreme Court judges)


3. It has the venue



Called the Rolls Building because
IP litigation literally rolls along ...
Under Article 5(1a) of the Working Document that establishes the Court of First Instance (and presumably Articles 7 and 8, which set up the Court of Appeal and Registry), it states that the host Member State "shall provide the necessary facilities for that purpose." Well, you are in luck, because this Fall the new dedicated business court opened on Fetter Lane – a hop and skip away from the Royal Courts of Justice. The new state-of-the art Rolls Building (picture, right) is the biggest dedicated business court in the world – reportedly 4 times the magnitude of its nearest competitor. It houses the Commercial Court and the Patents Court, includes 31 courtrooms, 12 hearing rooms, 44 public consultation rooms and ample (almost cavernous) waiting facilities. The Court is also spearheading new e-filing systems (Article 25 of the Working Draft).

As to be expected with any new building, there were some initial teething problems, but the venue is ready to go, should the Unified Patent Court find a home in London -- avoiding unnecessary costs and long delays in getting Europe's new, streamlined patent system up and running. Good litigators knows that avoiding unnecessary costs and delays should always be the main objective in everything they do, especially in establishing the new court system.


4. It has the location

If you are travelling from Silicon Valley or Sydney to attend a court hearing in the Unified Patent Court, do you want one non-stop flight or a three-leg journey to your destination? If you miss your flight, do you want to have to wait a day for the next flight? Thought so . ..! London is undoubtedly the world’s best connected city. Its five international airports see 5,000 international flights departing to 200 destinations, 10,000 incoming flights a week and 100 million passengers a year. How many direct flights are there from Alicante or Munich to destinations such as Cork, Billund, Kaunas, Poznan ..



British ingenuity solves great
problems, like "where do you
put the bathrooms in a building
made of glass?"
London attracts 30 million visitors a year and, as such, the AmeriKat need not get into the merits of the food (excellent -- now that it mainly comes from India, China, France, Italy, Thailand ...), the shopping (amazing) and cultural activities (incredible). Hotels are numerous and span the gambit of price ranges – true you will be paying a pretty penny if you choose to stay at the Chancery Court Hotel, but if you choose to stay at the numerous other hotels in the area, you are looking at hotel room prices for less than you find in comparable locations on the Continent. You can even pitch your own tent outside centrally-located St Paul's Cathedral at no cost at all.



5. Dispelling the misconceptions

The pound sterling: still
worth more than its cousin
the euro
“Maybe, but its so expensive…”, the AmeriKat hears you say. Unless you are planning to purchase a property in Chelsea, shop at Whole Foods and send your child to Eton, the expense factor is a misconception. The charge-out rates by UK-based firms are comparable to similar practitioners in other countries. Litigation costs in the UK have been the focus of intensive judicial and governmental review and supervision over the past several years. The new and improved Patents County Court is the feather in the hat of low costs IP litigation in the UK. Further, given that most everyone and everything a patent litigant needs is already in London, considerable expense is saved from shipping people, expertise and papers out to some unascertained location.


6. A few more reasons

A London-based Unified Patent Court is also politically advantageous for the UK and for Europe. The AmeriKat will not venture down the road of European politics (she cannot vote in UK or in EU elections so is neutral on this point) but, suffice to say, she agrees with the comment by "anonymous at 13:33" on Merpel's post (here). Unlike countries such as Italy and Spain, the UK has been ready and willing to engage in a Unified Patent System for a while and, unlike Germany, France, Spain, Italy, Belgium etc, the UK does not host an EU IP institution. Some say that, because Italy and Spain are reluctant to participate in the scheme as it stands, the court should go to one of them as an encouragement to them to commit. Willingness (or reluctance) to be involved in the system and process is not the litmus test, nor should it be a deciding factor for the appropriate venue for the court. The decision should be based on merit and the ability for the seat to meet the goals of an effective Unified Patent system and court as identified in the Working Draft's Recitals. (picture, left - the UK's most famous cat, besides the IPKat)




London already has everything and everyone that is needed to run an effective Unified Patent Court. All you need to bring is an umbrella ...

18 comments:

Steve Peers said...

Since the EU clearly wants its patent scheme to be successful this time around, the key question which should be posed is, "Where should the patent court (central division) be located in order to ensure the greatest chances of the scheme's success?". This certainly would point towards London, or at least towards a small number of cities - including London - where patents are frequently litigated and which are easily accessible internationally. Conversely it would point against locations which do not meet those two criteria, even if the countries concerned do not yet have an EU agency. These two criteria are not so relevant as regards the location of agencies, as distinct from courts.

Anonymous said...

I nearly agree with Steve, with the proviso that "success" needs to be defined. We need to have a court that is considered to be fair to all parties, that is determined to make the rules functional and effective, and that gives a cost-effective solution. It is easy to make a court successful in terms of attracting cases - just make it flagrantly pro-claimant and you can guarantee to attract work. That might make the court successful on one measure, and it will be popular with trolls, but it will do nothing to build the social good that the project is aimed at achieving. On this measure, we can be confident that the environment in London would foster a truly successful court.

Anonymous said...

These reasons also apply to München and Düsseldorf. Which are more centrally based in Europe, in a more European minded country than Albion.

So from an objective point of view - neither England or Germany are my home countries and both are at about equal distance from my home - I'd rather opt for München than for London.

And it's also a bit less expensive than London. Remember once in a while, we have to take the interests of our client into account as well.

Anonymous said...

A significant barrier to London becoming the home of the UPC is, however, the inability of the population to work in anything other than their native language. Can you imagine UK court officers processing documents in Bulgarian?

Anonymous said...

In my experience court officials don't even read the documents that are in English. Not sure that is such a hurdle....

Anonymous said...

As a Client, my pet peeve is costs!
London is a horribly expensive city compared to Munich and that translates into higher costs at each stage - from higher fee for attorneys in the matter all the way to very HIGH hotel room charges... frankly, I would not put my vote for London.

Anonymous said...

The arguments in favour of London certainly have considerable merit.

While many native English people might not have foreign language fluency, I recall that some years ago Air France based its main international office in London because of the availability of native speakers of pretty well any language. However, experience suggests that politics will prevail over logic.

Anonymous said...

Expensive London: a total myth. Here's the table of research results, commissioned by ECA Research for the City Mayors Foundation. In the table of most expensive cities, Central London is only 37th, well behind Paris (9th), Munich (15th), The Hague (17th), Milan (21st), Barcelona (27th) and Madrid (30th). Outer London is 49th.
See full chart here http://www.citymayors.com/statistics/expensive-cities-europe.html

Anonymous said...

Agree with Anon @12.56, London's not cheap, but neither is any other large EU city (the prices in Brussels were eye-watering even compared to London and Strasbourg and Munich were no better). If you want cheap, then you have to go to a smaller, less popular city, but that often means poor transport links and increased cost of flights. London is well served by a large number of airlines, which must push down travel costs, and also means you can actually get there when you want (thus saving the cost of extra hotel nights), rather than only when there's a flight available (try flying to Strasbourg and you'll see what I mean on that).

Anonymous said...

Anonymous@12:56 I think that it was a Londoner who made the quip of "Lies, damned lies and statistics". Those in particular, judging from my own anecdotal evidence, seem incredibly fishy, and I'd like to get some alternative data from a less obscure source.

As for Anonymous@2:42, Brussels is in fact surprisingly affordable, apart from a handful of expense-account restaurants and hotels round the EU institutions. Maybe I should give you some addresses...

Anonymous said...

How about in London right near the Old Nick...so that the Kats won't be too far away for the mice to play....

Annsley Merelle Ward said...

Anonymous at 5:46PM -

Your wish is this Kat's command:

ECA International conducts a yearly survey into the most expensive cities for cost of living - which is probably the best indication. The Top 50 most expensive cities in the world included the following EU MS cities:

13. Helsinki, Finland
17. Stockholm, Sweden
20. Paris, France
30. Gothenburg, Sweden
34. Vienna, Austria
39. Brussels, Belgium
43. Rome, Italy
48. Strasbourg, France

London is not there, you will notice....

http://www.eca-international.com/news/press_releases/7355/

ECA International also conducted the survey which you cited as "fishy".

http://www.citymayors.com/statistics/expensive-cities-europe.html

The UBS survey has Paris, Vienna, Luxembourg above London and Munich who are 15 and 16 respectively.

However, the UBS polled less cities in Europe than the ECA so the data pool is smaller and thus should be taken into account.

Buying lunch in Denmark costs €26 and in Brussels its €18 - in London you can get a good lunch for around €12 (or free if you can get the AmeriKat to pay). A carton of eggs (should you need it during your patent proceedings) will cost you €2.56 in Finland,€4.24 in Paris and €4.96 in Vienna. In London - 2.20. Should you wish to purchase a washing machine in Berlin, it will cost you €600.

http://images.businessweek.com/ss/10/06/0622_most_expensive_cities/1.htm

Roufousse T. Fairfly said...

London is the largest and most important financial market in the world. Say what you want about the current state of affairs in the world’s financial markets but, where there is strong financial center, therein follows innovation and expertise – expertise that is found in the UK’s judiciary, its experienced practitioners, and litigation support services.

and

[...] and -- unlike some civil law systems -- there is no career judiciary in the UK. British judges, and especially the IP-specialist judges, are recruited from the cream of the country's senior legal practitioners; [...]

Please allow me to reformulate your impassioned arguments (or twist them viciously, if you prefer):

UK judges are co-opted from practictioners dedicated to the pursuit of corporate interests, who will know where their best interest lies if they are to return one day to private practice.

As to the relationship between innovation and capital, I'm not so positively sure about that either. (Critics such as David F. Noble come to mind).

Is that compatible with the goal stated in the EU document:

CONSIDERING that the Unified Patent Court shall be designed to ensure expeditious and high quality decisions, striking a fair balance between the interests of right holders and other parties and taking into account the need for proportionality and flexibility [...]

I note that magistrates will have to be recruited from all EU members, where civil-law tradition clearly dominates. I'm not so sure how this could fit with the local London talent, or how the British could impose their vision of things.

As a national of a former (?) colony whose judicial business was once ultimately settled by the House of Lords, I'm not that convinced either of the inherent superiority of the British legal system.

For costs, I remember reading (here?) that infringement proceedings in the UK are notoriously expensive, and that the litigant better plan a war chest of the order of one million pounds or more.

Is this what we want for an EU patent court?

If you are travelling from Silicon Valley or Sydney to attend a court hearing in the Unified Patent Court, do you want one non-stop flight or a three-leg journey to your destination? If you miss your flight, do you want to have to wait a day for the next flight?

As if the Texas ED venues were that accessible... How do you get from, say, Redmond WA to Texarkana TX? Yet parties love to mess around in Texas. And why should an European court favorize a particular group of overseas litigants over another one, or, for that matter, over its own citizens? If the number of cases handled by that court bears any relation to that handled by the EPO's BoA, it shouldn't be a big factor. And frankly, I'm not so sure that air travel will still be around in the current form in the next decades.

IMO, the language issue militates against the selection of London, as it would make English more equal than other languages. Small regions, with a lot of political or political borders, are still the best candidates, even if that means reverting to one of the usual suspects (BE, NL, LU, or even Strasbourg or Geneva).

Anonymous said...

'1. Already the patent litigant’s venue of choice...

In the intervening years, pending the adoption of a Community patent, where litigants have had a choice of forum, the UK courts have become the obvious venue of choice for litigants and practitioners -- European and foreign alike.'

The amount of patent litigation taking place in London is a fraction of that ocurring elsewhere. The DE courts, for example, handle orders of magnitude more cases.

A quick look on bailii shows a mere 26 decisions of the Patents Court for 2011. Of these, 2 were appeals from the IPO, 1 concerned SPCs, 1 was a copyright matter, 1 concerned damages, 2 concerned agreements, 10 were broadly procedural matters, and a paltry 9 concerned 'substantive' issues of I and V.



2 'where there is strong financial center, therein follows innovation and expertise – expertise that is found in the UK’s judiciary, its experienced practitioners, and litigation support services.'

It is tenuous at best to draw a link between London as a financial centre and it having experienced patent judges/practitioners. There is no obvious correlation between the two at all.

There is even less evidence to suggest any link between the 'City' and technological innovation, of which there is approximately zero in London.


'3. It has the venue'

This is really scraping the barrel as a reason. As if a suitable venue couldn't be found in Paris, Frankfurt, Amsterdam etc (all of which, incidentally, are also financial centres having experienced patent judges/practitioners...)


4 'It has the location'

see e.g the above three cities which are also well connected. Frankfurt's airport even works most winters...

5 'Dispelling the misconceptions'

Litigation costs in the UK remain considerably higher than elsewhere in Europe.

London has certainly become cheaper than it was relative to other European cities over the last five years as the pound has dropped against the euro.

But it remains one of the most expensive cities in europe. Further, given that most of europe uses the euro (for the time being at least), there would be an argument against London so as to protect the majority of European users of the court against currency movements.

'6 A few more reasons'

More barrel scraping

Anonymous said...

Anonymous at 10:11 - -

1. You say the amount of patent litigation occurring in London is a fraction of elsewhere. How are you measuring litigation - by applications, by case number? Also, what is the "fraction"?

2. How is suggesting concrete venues ready for the job is scraping the barrel? What court venues are you proposing in Paris, Frankfurt and Amsterdam?

3. See the data on Europe's most expensive cities - London ranks below Paris and Brussels.

4. Is barrel-scraping a legitimate argument now?

5. What city are you suggesting, or are you just suggesting anything other than London?

Anonymous said...

Dear AmeriKat, various AnonyMice,

Wikipedia has an interesting entry on the subject of the different cost of living rankings. As it turns out, ECA International's ranking, like that of the Economist Intelligence Unit, notably excludes the cost of housing, which is notoriously high in London.

Mercer's cost of living ranking,on the other hand, does include housing, and, unsurprisingly, London figures rather more prominently there.

A straight cost-of-living comparison between London and Brussels in collaborative website Numbeo reveals that, while some groceries, clothing and telecoms are considerably more expensive in Brussels (which...ahem...may be due to Belgium's rather oligopolistic retail market, maybe the EU's competition authorities should have a closer look), rents cost half as much as in London, and buying a house is two-thirds cheaper (!).

Anonymous said...

Thank you for the data, Anonymous! Obviously for judges incoming to London for the long-haul, housing/rent may be an issue and definitely a consideration. However, how many litigants are planning to purchase a house in London or indeed Brussels during their court case?

Anonymous said...

Curiously, nobody mentioned a serious drawback of London as seat for this court: the inconvenience of getting through passport control to enter the country from anywhere else in Europe. While this may not be of notice for Californian litigants, the hassle of waiting in a queue in Heathrow probably beats that of having to change planes or trains to go to Krakow or Tallinn...

Nevertheless, reading the latest news, it is apparent that Britons have not yet noticed how much their refusal to enter the Schengen treaty alienates them from the rest of Europe and ultimately damages their economy...

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