A test-drive for the Unified Patent Court: Part IV

Readers of this weblog who litigate patents in the old Europe may recall a series of past posts on the subject of litigating patents under the experimental, not quite hatched and [in this Kat's opinion] arguably not even half-baked Unified Patent Court (UPC) system that has been created for the new Europe, with its fascinating new collection of Rules.  This series has been masterminded by the Bristows brace of authors Alan Johnson and Alexandria Palamountain and the three earlier reports are "A test-drive for the Unified Patent Court" (June 2014, here), "A test-drive for the Unified Patent Court: Part II" (October 2014, here) and, perhaps unsurprisingly, "" (25 February 2015, here).  Now it's time for the fourth:

The interim conference

Slightly less than 12 months since the commencement of proceedings, the Bristows’ real time UPC moot is reaching its climax. The interim conference had been scheduled for 14 April, but was postponed by two weeks due to unavoidable diary conflicts (something that would not happen in real life) but took place on 23 April. 

The interim conference opened in a manner which took everyone by surprise –- and indeed completely bamboozled about half the participants who had little idea what was going on. Although the language of the proceedings was English, Judge Rapporteur Rieu opened the proceedings speaking in French. She noted that each party included in its legal team a fluent French speaker, and drew attention to Rule 105.3 of the [17th draft version of the] Rules of Procedure which states that the Judge Rapporteur may hold the interim conference in any language agreed by the parties’ representatives. 

Fortunately for the non-French speakers, the French-speaking representatives (Anne-Laure Bouzanquet and Laura von Hertzen), declined to agree to use French. In parenthesis, it may be noted that it is a good thing R.105.3 was amended to require the parties to agree, since the previous version of the rule appeared to leave the matter solely in the hands to the judge. After that entertaining start, the real business began. 

Dim view 

Making light of a dim view

In advance of the hearing, neither party had approached the other about trying to agree any orders being sought. Instead, each party had sent the Registry a note which set out the orders they would request. The Judge-Rapporteur took a rather dim view of this lack of cooperation in advance, despite the parties pointing out (diplomatically) that nowhere in the Rules is there any suggestion at all that this would be regarded by the Court as appropriate, let alone required.

Much of the discussion concerned whether any additional evidence could be filed, and whether disclosure should be ordered. Readers may recall that this is a second medical use case where the defendants were alleged to be actively promoting off-label use. Given this, the Judge Rapporteur acceded to the requests for some additional evidence and party disclosure, but not to the third party disclosure requested from one customer of the defendants. During the discussion about third party disclosure, it emerged that the Registry had not served the request for third party disclosure on the third party. The Registry, in its defence, does not appear to be under any obligation under the Rules to do so, whereas the whole scheme of the Rules is that it is the Registry, not the parties who must serve documents. In any event, the Judge Rapporteur considered such disclosure unnecessary on the facts. 

Undecided 

On one issue, however, the Judge-Rapporteur was undecided. Readers may recall that the procedural course of this action was a little unusual, with a second patent being added into the suit over half way through the proceedings. The Court was anxious to keep the timetable on track and had given the defendants relatively little time to deal with the second patent (an expired compound patent) in it defence. The defendants were unable initially to find any relevant prior art and had simply pleaded non-infringement as a defence. However, shortly before the interim conference they announced that they wished also to rely on invalidity, meaning they needed (under R.25) also to counterclaim for revocation. 

Judge Rieu pointed out that she found it odd that the Court would be asked to revoke an expired patent –- although this is something the EPO seems to have no trouble doing when its opposition procedures meander beyond the 20 year term. Judge Rieu therefore used R.102.1 to refer the question to the full panel for decision. In so doing, she asked the parties for further short written submissions on the point, but did not arrange a further hearing to hear the parties’ oral submissions. It was not explained to the parties exactly how the panel decided the matter, but later Judge Rieu issued a written judgment announcing that the Court declined the request to add the counterclaim for revocation, without prejudice to the defendant’s ability to rely on invalidity as a defence to damages under R.138 if there was a finding of infringement.

Do you want a review? 

At the end of the hearing, Judge Rieu also asked the parties whether they wanted any other part of her decision reviewed under R.102.2. The fact that she did so at the hearing, and the manner in which she initiated a review on one issue herself, highlights some uncertainties over this review process, which is separate from the appeal process which can also be invoked by a party which does not like the decision (seemingly even if it has not first requested a review). Indeed, there is no guidance at all in the Rules about how the review process should work: when a review has to be requested (at the hearing or within a period after the decision?) and how the review itself is conducted, in particular whether the parties have a right to be heard, or whether it will be purely decided (as in this case) on written submissions, exchanged blind, or even, perhaps without any more submissions, but with the Judge Rapporteur merely consulting with her colleagues.

Finally, Judge Rieu took a typically French approach by imposing a sanction for non-compliance of a daily fine.* 

The parties now have some steps to take in advance of the oral hearing, and this is scheduled to take place on 28 July, and is listed for one day.

* This raises some quick questions from Merpel: does any reader know what happens to the money collected from a party as a fine for non-compliance?  Does the court keep it, does it go to the other party, or can the judge keep it? Is it taxable income? And is it gross or net of currency exchange and bank charges?