For the half-year to 31 December 2014, the IPKat's regular team is supplemented by contributions from guest bloggers Rebecca Gulbul, Lucas Michels and Marie-Andrée Weiss.

Regular round-ups of the previous week's blogposts are kindly compiled by Alberto Bellan.

Monday, 15 October 2012

You made this mess, you clean it up: JURI pass the buck to Council to resolve the deadlock on the unitary patent

The AmeriKat looking up at
Lord Justice Kitchin in awe during
his speech last Thursday
While digesting her dinner at the CIPA President's Dinner on Thursday evening, the AmeriKat enjoyably listened in awe of Lord Justice Kitchin as he expounded on the many issues with the unitary patent that have yet to and desperately need to be resolved before the system can be a success. The speech, which is soon to be published on CIPA's website and in October's journal, came the evening of the first debate on the unitary patent by the Legal Affairs Committee of the European Parliament (JURI) after their summer recess (video here from 11:14).


Readers will recall that before the summer recess the Committee agreed that the Legal Services would spend the summer analyzing and fine-tuning their thoughts on the problematic issue as to whether it was necessary under European Law that Articles 6 to 8 be included in the Proposed Regulation under Article 118 TFEU.

It was therefore only right that the first party to be given the floor during the Committee's Thursday morning session was the representative of the European Parliament's Legal Services. However, despite the long summer recess the answer from the Legal Services demonstrated that matters had progressed little:
Lord Justice Kitchin 
"As things currently stand all we can say is that the situation is the same as it was before the summer break. I can refer to the position that we had when we presented our opinion to the Committee before the summer. Now the deletions of Articles 6 to 8 from the proposed text of the Regulation would mean that an essential part of the Regulation would disappear, namely an arrangement which would protect the single patent in the European union and the material law. We take the view that this is an aspect which the legislature needs to clarify under Union law, otherwise there is the danger as far as we are concerned that the Regulation will not be compatible with the Commission's proposed legal base which is Article 118 TFEU and that means there would be a risk that the Regulation be struck down by the CJEU or could be struck down by CJEU."
MEP Bernhard Rapkay took the floor next. Although he predictably took the Parliamentary line of expressing dismay in how the Council's June agreement cut through the entire legislative process, his response was more or less pragmatic and more measured than what his previous performance had been during July's JURI session. His main request was that the Council provide justification as to why, under European Union law, the inclusion of Articles 6 to 8 was not necessary. Rapkay, after thanking the Legal Service, stated:
"The Legal Service as I have understood it has asked to us not to deal with this in the first meeting after the summer break but for us to take our time so that they have time to consider the pros and cons. The Legal Service has done some very good work here and they are recommending we stay with the result that we have. Now we have a really good Legal Service and I don’t think that the same can be said for all the other institutions because we discussed this one year ago and we asked the other Legal Services exactly the same questions and the Commission's Legal Service gave the same information as our Legal Service has given and there was a third Legal Service present as well at the time and they did not contradict this. I remember how they were just nodding their head at the time and then all of a sudden things are now different. Back then they said one thing and now they are saying something different and now this is the point where we really need to discuss things.

What I can see is the European Council in its decision in June went over and beyond its competence. It intervened in a legislative procedure and I think that is going over and beyond its competence. The decision that it took in fact flies in the face of European law and those two points are worth mentioning. But as you know, Chair, I am extremely pragmatic in my approach and I know that its not really possible to get a fair solution with Council and I think the right solution would be to leave Articles 6 to 8 in the text, but that is no longer possible I know, so its against that backdrop that we have to work out how to get out of this sticky situation because as far as Council is concerned it’s not really a tangible argument. There are a number of countries that are just as against this but they say "our political masters have decided in a particular way and we have to respect that decision", but those political masters are not our political masters – they might be seen that way in the Council but they are not our political masters in Parliament and we need to decide how we react to this new state of affairs.

MEP Rapkay
I have sent a letter to the Cypriot Presidency and I would just like to expressly say that the Presidency is doing what it can and its not their fault that others have given them the hot potato to deal with. They were not all that well prepared because it really wasn’t their task to take this on as such so I have to say that the Cyprus Presidency is being cooperative as far as the Parliament is concerned and I know what pressure they are under. I also know what pressure we are under, namely to make sure that the work we deliver is clean and in conformity with European law. I have [therefore] said in my letter that I would like to have a proper justification in terms of European law why it is that the Heads of State of Government wish to delete points Articles 6 to 8. I know a number of patent lawyers have a view which is based on facts about this but that’s one thing. You can have pragmatic arguments about this but it has to be in conformity with European law. The arguments that lobbyists put forward are not really related to European law, they are related more to patent legislation so I would like to have a justification in conformity with European law as to why this route was chosen by the Heads of State.

I know for pragmatic reasons we will not just be able to return back to what the status quo was in December 2011. We need to find another solution but that really is up to Council. That is their task. They are the ones who broke the previous agreement. We weren’t the ones who did that. Whatever the solution is one thing has to be clear. We won't accept just any old proposed solution that comes form Council . I understand this argument.

The legislative procedure that we are in is one where Parliament and Council have to come to an agreement. End of story. So, we need to work out where our red lines are. This comes back to what I said earlier on and what the Legal Service have just confirmed. Namely that the red line is that we will not accept [just] any proposal and we cannot accept [just] any proposal. The President of Parliament cannot sign any proposal for a Directive which is not in conformity with European law. That therefore is a red line. There are two particular points where this is very clear. There is the question of what the position is with the CJEU on this point. That is one of the controversial points. And so the opinion of the CJEU or their position on this needs to be in conformity with EU law and the treaties. Secondly, given what I have heard in the various discussion there needs to be some arrangement which means that Parliament is not cut out of the picture in future and our rights are protected. We will not be able to accept any solution where we give up our right legislate to someone else, whomever that is. The President of the EU Parliament will never be able to sign up to that sort of thing where it cuts the Parliament's rights out of the picture. Those are our red lines. Parliament needs to be completely clear about that.

If [Council's] proposal does not respect those red lines then they will still be the ones to blame if we still don't have this Unified Patent which we so desperately need. That’s the state of play. It is up to Council not up to us to come up with proposals. We will take a look at proposals and evaluate them and we will see to what extent they respect the red lines that I have just mentioned. "
Cecilia Wikstrom then took the floor optimistically saying that everyone has the potential to come to an agreement. Her optimism was then rebuffed by Austrian MEP Eva Lichtenberger who said that she considered there was a trend emerging whereby Parliament works on legislation that soon becomes hollow after negotiations. She said that Council needed to recognize that "they have backed the wrong horse" in the proposed deletion of Articles 6 to 8.  She considered that the solution would be found if the Commission came up with a new proposal with a different legal basis. Only then would they be on the right track. She said that Parliament could not agree to a situation where Council removes the "real heart and soul" of the agreement.

MEP Zwiefka
Polish MEP Tadeusz Zwiefka then explained that perhaps the divergence between the two institutions came about  because Council is "not used to this situation where they have to co-legislate with Parliament" ("Is anyone used to this legislative procedure" asks the AmeriKat, because no one seems to know what comes next and by whom."). Notwithstanding this, he stated that
"We simply cannot be dictated by the Council on such a complicated issue. That is simply not possible as a working method. Its not in line with our customary ways of working and its not in line with European law. Lets try to bring the work we have done to a satisfactory end and make our voices heard."
In closing JURI Chair Mr. Lehne stated that it is was essential to defend Parliament's rights. He also stated that whether informally or formally with Council, elements of the Regulation will be discussed with them in detail and it was important to establish Parliament's position clearly. He also stated that Parliament "must make sure that the text agreed is available so everyone is clear as to what we are negotiating on." The AmeriKat wonders if that really means "everyone". She suggests that if the Parliament wants all parties to work together to come to a solution, they would be well advised to publish the draft Regulation as agreed so that all parties and the public had the facts before entering negotiations (Kate note:  there is an updated consolidated Draft Agreement that was published on Thursday here). 

In summary, it seems that Parliament is calling on Council to come to a solution, i.e. "you created this mess, you get to clean it up."

Will we see a proposal from Council before
this Kat-themed Jack O'Lantern turns
to mush?
The parties have only three weeks to progress the negotiations before the next JURI meeting on 6 November (a few days before the Rules of Procedure Committee meet on 10-11 November to produce the 10th draft of the Rules in advance of the official public consultation). The AmeriKat hopes that during this time national governments who have opposed the inclusion of Articles 6 to 8 and who share other substantive concerns with the proposals prepare detailed reasoned submissions why such concerns are necessary to be resolved under EU law.She understands many national governments, including the IPO (who have a stakeholders meeting tomorrow to discuss the current state of play), have prepared such papers (although the public status of these papers is not yet clear). 

Creatively musing, the AmeriKat wonders whether because the main underlying effect of the other substantive defects in the proposals (forum shopping, ability to staff the courts with qualified judges, applicability of bifurcation, etc) would/may lead to the un-uniform application of IP law across the unified patent system (and the Union) would those provisions in the current proposals fall foul of the intention set out in Article 118 that the measure provide uniform protection? Might that be a way to sneak them into the current round of negotiations to see if the parties can get those defects fixed?  

In the meantime, the AmeriKat, who is preparing for AIPPI in Seoul this week, will be awaiting the next move from Council. 

17 comments:

Gibus said...

Thanks for this transcription. Nevertheless, be careful with the live translation of the European Parliament, spcially English. Some import stuffs are often left behind...

An important quote, as transcripted in this post, from rapporteur Rapkay is: Secondly, given what I have heard in the various discussion there needs to be some arrangement which means that Parliament is not cut out of the picture in future and our rights are protected. We will not be able to accept any solution where we give up our right legislate to someone else, whomever that is. The President of the EU Parliament will never be able to sign up to that sort of thing where it cuts the Parliament's rights out of the picture.

Don't you think this is a call to waive less power to the EPO, by including substantive patent law, notably patentability rules, in the regulation? As repeatidly stated on comments in this blog, such inclusion may be mandatory for compliance with Art. 118 TFEU...

If readers are interested by a reeaction to JURI meeting, just a couple of hours after its end, they can read this press release.

FInally, the opinion of the EP Legal Service referred in the beginning of this post can be found here.

Annsley Merelle Ward said...

No I don't think that is call to waive less power to the EPO at all. The EPO doesn't factor into this debate. It was a comment regarding Council's decision in June. The provisions on substantive law included in the Regulation concern infringement not validity so issues about patentability don't enter into the mix either.

Gibus said...

Maybe you should read this new paper from the Max Planck Institute:

Ullrich, Hanns, Select from Within the System: The European Patent with Unitary Effect (October 1, 2012). Geiger, Chr. ed., What Patent Law for Europe?, Paris (Litec), Forthcoming; Max Planck Institute for Intellectual Property & Competition Law Research Paper No. 12-11. Available at SSRN: http://ssrn.com/abstract=2159672

"Clearly, such EPC-based “European” patents do not constitute “European”, namely European Union intellectual property rights within the meaning of Article 118 para. 1 TFEU. Therefore, the question arises whether it suffices that the substance of the European patent with unitary effect is made a matter of Union law."

I wouldn't be as confident as the Amerikat, that this regulation can be passed without full integration of substantive patent law inside the regulation...

Anonymous said...

Oh God, the FOSS brigade are out again. When will they realise that this issue really has nothing to do with them?

MaxDrei said...

Readers interested in bifurcating might find interesting the Sept/Oct 2012 issue of The Patent Lawyer, where questions about litigating patents in Germany are answered. It is true that technically qualified federal judges do validity but in the district court patent infringement track none of the three instances have any such judges.

Nevertheless, we are told, it is "relatively common" for the infringement courts to grant interlocutory injunctive relief.

This is what Americans might call a "strong" patent system. Governments world-wide used to compete to be the most "patent friendly" jurisdiction. But they are not doing that any more are they?

Anonymous said...

MEP Rapkay appears to be an impressively clear and persuasive speaker, which concerns me as I disagree with almost everything he has said on the subject of the EU patent and the proposed court.

Regarding this issue having nothing to do with the 'FOSS brigade', I disagree. The worst failings of the patent system at the moment are, in my opinion, centred on IT, telecoms and computer-implemented inventions. Software patents are, of course, expressly prohibited under the EPC, but the EPO has granted countless thousands patents which look an awful lot like software patents. A large proportion of these are probably invalid, but it will cost you rather a lot to prove this one way or the other.

The input of the 'FOSS brigade' into the debate is, in my opinion, welcome, as they tend to be rather more tech-savvy and better connected with the software industry than most patent lawyers. I say that as a patent lawyer who has worked on several patent cases involving electronics and IT.

MaxDrei said...

Reasonable comment from that last anonymous. Patent lawyers can no longer have the patent business all to themselves. These days, it's highly political.

If I had to debate CII with a FOSS or biotech with a Green, I'm inclined to agree, that I would learn more from the debate with the FOSS than I would get out of what would be a highly emotional argument with the Green.

Anonymous said...

Software patents are, of course, expressly prohibited under the EPC

First, tell me what you understand as a software patent, then where in the EPC they are expressly forbidden.

Strangely, for somebody claiming to be a "patent lawyer", you don't seem to be very familiar with the ins and outs of Art. 52 EPC, nor with the case law of national courts upholding patents granted by the EPO.

Anonymous said...

Software patents are, of course, expressly prohibited under the EPC

Where?

MaxDrei said...

In the past, patent lawyers were as rare as teeth on a hen. Now though, every second attorney-at-law claims to be one. It's the glamour attached to it, these days.

Anonymous said...

MaxDrei, even now, I don't know of many attorneys-at-law or other lawyers who would call themselves "patent lawyers". Patents are just too narrow a niche for lawyers: they'll usually call themselves IP lawyers, with competition law often dropped in. In my experience, talk of "patent lawyers" (coupled with absolute ignorance about the existence of technically qualified patent attorneys and agents) is usually the hallmark of those with only a very superficial acquaintance of the patent system, in particular among the FOSS community. Hence my utter scepticism about that anonymous.

MaxDrei said...

Anonymous, well said. Question is, do FOSS people want the facts. Or do they not want to be bothered with them?

Anonymous said...

Max: I think those interested in FOSS are not so interested in the facts as they are, because the FOSS position is an ideological, rather than an advisory, position. But I think they have a clear view as to how they would like (want/hope) the facts to be, or to become. I think we all can state how we would like the system to develop: the FOSS position is one view in a set of competing views.

Anonymous said...

"Oh God, the FOSS brigade are out again. When will they realise that this issue really has nothing to do with them?"

And you will tell us that EPO does not grant software patents again?

Be prepared for the big return of the "brigade".

Anonymous said...

I can't understand the controversy about saying that software patents are excluded from patentability under the EPC. EPC 52(2)(c) says that programs for computers are not inventions, and 52(1) says that patents may only be granted for inventions.

Sure, there's scope for chicanery and debate about the argument about what this means, but the point remains that the EPC excludes computer programs from patentability, and that there are very good reasons for this.

The EPO is far too willing to grant patents for what are, in substance, programs for computers.

Anonymous said...

I can't understand the controversy about saying that software patents are excluded from patentability under the EPC. EPC 52(2)(c) says that programs for computers are not inventions, and 52(1) says that patents may only be granted for inventions.

And Art. 52(3) EPC (often forgotten by the critics of the EPO practice) says that
Paragraph 2 shall exclude the patentability of the subject-matter or activities referred to therein only to the extent to which a European patent application or European patent relates to such subject‑matter or activities as such.

It's worth noting that, besides "programs for computers", Art. 52(2) EPC also excludes from patentability, for example, "discoveries, scientific theories and mathematical methods". But obviously the legislator didn't intend to exclude from patentability novel and inventive technical uses of such "discoveries, scientific theories and mathematical methods" (because that would exclude, basically, all of invention), hence the importance of the "as such" provision of Art. 52(3) EPC.

For this reason, if the legislator had also intended to prevent the patentability of novel and inventive technical applications of computer programs (whether it is methods or devices controlled by such computer programs), then he would not have put "programs for computers" in the list of items excluded from patentability "as such" under Art. 52(2) EPC, but among the absolute exceptions to patentability under Art. 53 EPC, which is not tempered by any equivalent to the "as such" provision of Art. 52(3) EPC.

Anonymous said...

"per se" and "as such" cannot be ignored, because the PURPOSE of software must be taken into account.

If the purpose is "just a program," (whatever that means, which I am not sure, as I certainly don't waste time programming for no apparent reason) then no. But if the purpose is for something (to accomplish something) that is itself patent worthy, then by all means yes.

Subscribe to the IPKat's posts by email here

Just pop your email address into the box and click 'Subscribe':