From IP to NP, Day Two: Part 1

The second day of "From IP to MP (Net Profit)", the AIPPI conference hosted by the organisation's Israel chapter in the Dan Panorama Convention Center, Tel Aviv, opened with a flourish with a plenary session starring two of the best-known names in intellectual property litigation circles: Randall R. Rader (Chief Judge of the United States Court of Appeals for the Federal Circuit) and Klaus Grabinski (Judge of the Revision Chamber, Federal Court of Justice, Germany). Their respective Honours were asked to consider a subject of interest and not without controversy: "The rationale and role of specialized IP courts".

This session was convened by Seth Heller (Arnold & Porter, USA) and Tal Band (President AIPPI-Israel, Senior Partner, S. Horowitz & Co.) and moderated by Matthew Wolf (Partner and Co-Chair of Intellectual Property, Arnold & Porter, USA).  Opening the proceedings, Tal gave us all the welcome news that the speakers' PowerPoint presentations will be made available on the http://aippi.org.il/ website: participants will be notified by email once they're up.

The assessor can give his
"thumb up" -- but we may
never find out why ...

Tal then introduced the topic of specialised courts and judges, in light of the AIPPI's favourable attitude towards them, observing that this was not yet happening in Israel, where the courts were overloaded and had few temporal resources when it came to dealing with complexities.  He returned to one of the previous day's topics mentioned by Judge Benyamini -- the uncertain role of expert assessors in Israeli litigation, where there is little transparency or scrutiny of the assessor's function. However, the absence of an assessor is equally problematic since judges -- people with the lowest level of scientific knowledge -- have to decide patent cases on the basis of their appreciation of evidence that they struggle to understand. Finally, Tal turned to the issue of the refusal of the courts to consider invalidity on a motion for a preliminary injunction, which is arguably in conflict with two provisions of Israel's patent legislation.  A more experienced and knowledgeable court would be able to handle this, improving predictability of decisions, thereby reducing the number of cases getting to trial as well as the number of cases appealed.

Klaus Grabinski

 Matthew Wolf then introduced Judge Klaus Grabinski, addressing the current German court system as well as looking forward to the new European regime.  The principal feature of Germany's system is its bifurcation between infringement and invalidity proceedings: that split is not however watertight,Judge Grabinski revealed.  The judge first described the German court structure, then gave some statistics regarding the volume of patent litigation in Germany, which is unusually high when compared with other countries in Europe.  In more than half of the cases, the defendant is a foreign company or a German subsidiary of such a company.  While infringement is dealt with under a three-tier system (trial before a district court, with appeals to a regional court and then to the Supreme Court (the Bundesgerichtshof), revocation is dealt with by a two-tier system, with cases being filed in the Bundespatentgericht (Federal Patent Court) and appealed to the Bundesgerichtshof).

In German infringement litigation, claims and evidence are front-loaded and expressed in full in a written procedure: "skeletons are not good enough".  The court will give a preliminary view at the beginning or oral proceedings. Decisions on the merits come between three and five weeks later, with appeals on questions of law. A further appeal is available but only with permission of the courts. The judge contrasted this with the mechanism and time-table for revocation proceedings, where the decision is handed down at the end of the trial but the reasons are made available later once they are written.

Language is a problem -- but it could
always be worse

Judge Grabinski then returned to the new European regime, discussed yesterday by Trevor Cook, looking at the unitary patent and the unified patent court (UPC) within which the unitary patent will be litigated. He reminded us that the court of first instance is not centralised, since it has local and regional divisions (Germany intends to have four local divisions but the UK and France, he said, are believed to want just one). He also outlined the role of the Court of Justice of the European Union, as well as jurisdictional issues. Different courts would have different blends of technically and legally qualified judges, depending on various criteria.  Language is an issue too, since relying on translators and interpreters "won't work". In Central Division proceedings, the language of the proceedings is the language of the patent.  Oral proceedings should not take more than one day, and it shouldn't be necessary to for any case to take more than a year. So far as bifurcation is concerned, there's a compromise solution in which bifurcation may be chosen or avoided. The judge closed with observations on the transitional period -- currently seven years but it can be extended -- in which classical European patents can still be litigated before the old national courts or the new court, as well as the opt-out.

Randall R. Rader

Next to speak was Judge Randall Rader, who started by asking what the patent system is supposed to do in a global environment: as the market has become global, our legal institutions have remained insular [says Merpel: he must be referring to the US and no doubt to the ITC.  The good folk in Europe, even those who live on islands, have been becoming increasingly non-insular in recent times].  He then told us about his various meetings with intellectual property judges in various countries in the Far East and indeed with judges from closer to home, concluding:

"The judges who are working in intellectual property are creating relationships that will enable them to serve you better; you will have to work hard to keep up with them.  As we judges get to know each other better and read each other's judgments, there will be more judicial convergence in the way we serve our clients", 

he said. Judge Rader then spoke of the importance influence of the Federal Circuit in the United States, where at home it has achieved much the same degree of convergence. However, appellate courts just provide the drumbeat for trial courts to march in time with -- but what is most important is what happens in the trial courts themselves.  The US too has to move away from its own Balkanised system, he concluded.