Fee and easy
Four experts ponder the zero opt-out fee announced for the Unified Patent Court

Adrian Murray
Legal director
Pinsent Masons

Mark Ridgway
Allen & Overy

Alan Johnson

Alexandra Pearson
Hogan Lovells

A zero opt-out fee for the Unified Patent Court was announced in February. What does this mean for potential users of the unitary patent system?

Mark Ridgway: The zero opt-out fee will be very welcome news—for any company that is cautious about the new system, being able to observe it in operation before deciding to take part is highly desirable.

This is also the fair approach. People can now be won over to the new system (or not), without an artificially high opt-out fee affecting their behaviour.

Alan Johnson: Patent applicants can now take their decisions without having to take budgetary issues into consideration. Opting out achieves the certainty of national jurisdiction only.

Alexandra Pearson: Patent applicants can now take their decisions without having to take budgetary issues into consideration. Opting out achieves the certainty of national jurisdiction only. One of the few areas of clear consensus in the Unified Patent Court (UPC) costs consultation was that the €80 opt-out fee should be removed or lowered. The announcement of the free opt-out fee is therefore positive news.

Why offer an opt out for a system that hasn’t even launched yet? Is the UPC being written off before it even launches?

Pearson: The answer is that the patent proprietors applied for these patents and applications before the system was conceived and so, an allowance for those patent applicants to opt out and continue with their legitimate expectations as to how these property rights would be dealt with by the courts in Europe is a fair option to provide. The system will hopefully prove itself by the quality of its decisions/procedures and then more will leave patents in the system and/or opt in.

Adrian Murray: The thinking behind starting the opt-out option to patent holders prior to the new system becoming operational is to prevent the unitary patent registry being overwhelmed with opt-out requests on day one.

If it was only possible to opt patents out of the new regime on day one of it coming into operation, then patent holders that are adamant that they do not want their patents to be under the jurisdiction of the UPC would seek to opt their patents out as soon as possible, to ensure that the jurisdiction of the UPC could not be seized.

Ridgway: Unfortunately, the reality is that the new system was always going to be unpopular in some quarters. That said, the opt-out exists for the benefit of the companies and individuals that use the patent system—it allows them to avoid the new system if they want to.

The reality is that many companies will want to do this because they don’t know how the new system will behave and do not like like the uncertainty that this brings—for example, if it does not work properly the system could threaten the value of patents that companies have invested significant sums of money in.

The reasons for the opt out are therefore two-fold in my view. First, any attempt to force companies to take part would have been deeply unpopular, hence politically undesirable. Secondly, related to that, compulsory participation (at least immediately) would have increased the likelihood of further legal challenges. In short, therefore, the designers of the system had no practical choice but to allow for an opt out if they wanted it to go ahead.

Johnson: I can understand that it may seem strange to be offering patent applicants an option not to use the new system, but not when you consider that what has been done is a major moving of the goal posts.

The UPC is a very different system and while attractive to many, it will certainly not be attractive to all. When patent applicants ‘signed up’ to using the European Patent Office to prosecute their patents, they believed their patents would be litigated nationally. This suits many patent applicants very well. A small- and medium-sized (SME) entity would, under the existing system, only ever litigate in its home country.

Under the new system, however, it could face a revocation claim brought against it in the Paris central division. Indeed, even if the applicant for revocation was also German, the parties would have to litigate in Paris. Is it sensible to impose that new regime on anyone, let alone an SME?

Offering patent applicants a transitional arrangement that maintains the status quo is perfectly reasonable In any event, quite enough patent applicants will be in a different position and want to take the benefit of the new system, not to worry about those who may prefer the old system.
The latest features from IPPro Patents
Celebrating its 10-year anniversary this year, Allied Security Trust plans to build its patent acquisition business even more. CEO Russell Binns explains
Facing unacceptable pendencies in 2003, the Canadian Intellectual Property Office dug deep to make the patent prosecution service more efficient
Join Our Newsletter

Sign up today and never
miss the latest news or an issue again

Subscribe now
TC Heartland’s Supreme Court question may see patent owners going cold on the Eastern District of Texas
It is incumbent on practitioners and applicants to take care in drafting and prosecuting applications, says Bea Koempel-Thomas of Lee & Hayes
Is American chipmaker Qualcomm in trouble? Joachim Frommhold of Weinmann Zimmerli examines the facts
IP arguably sits on the periphery of any discussions about what a post-Brexit UK will look like, but that hasn’t stopped the country’s patent-granting authority from getting on with its job
With President Trump recently installed in the White House, will the internet industry be able to convince him to look at patents?
Acronyms such as IoT and UPC dominated discussion at this year’s London IP Summit
Country profiles
The latest country profiles from IPPro Patents
Bruno Nunes of BN IP explains how patent prosecution and licensing works in Macau, a market dominated by gaming and pharma
Tran Viet Phuong of Duong Tran offers a handy guide to patent prosecution
IPPro Connects

Visit our sister site
the worlds biggest and best IP directory

The Andean Community has stood firm in the defence of its owns interests, says Jesús Cuba and Kelly Sánchez of OMC Abogados & Consultores
The first preliminary injunction granted by a China IP court was awarded to Christian Louboutin. Dr Weili Ma of Chofn Intellectual Property explains
Patent prosecution in South Africa rarely favours the inventor, but recent reforms are aiming to change that, one little bit at a time
The Tanzania Patent Office is a useful partner in the prosecution process, says Sunday Godfrey Ndamugoba of ABC Attorneys
Dominic Ogega Mwale, managing partner at Mwale & Company, explains how to patent in Kenya
Patent owners looking for an attractive place to seek protection in Asia need look no further than Singapore, says Max Ng and Gerald Mursjid of Gateway Law Corporation
The latest interviews from IPPro Patents