Introduction

As the UPC system opens its doors, it may be important when forming a patent exploitation strategy to understand which law applies when considering the treatment of the Unitary Patent as an item of property. This is for the most part set out in Article 7 of Regulation EU No. 1257/2012 (the Unitary Patent Regulation or “UPR”), however, as is discussed further below, there are some question marks over which law will be applied in certain situations.

Entitlement

As for the classic European Patent, the right to a Unitary Patent belongs to the inventor (or their employer) or their successor in title. Under the UPR, the law covering the treatment of a Unitary Patent as an item of property – including the question of who is entitled to the patent – is determined according to a cascading set of rules. The primary position is that it is the law of the country of residence or principal place of business of the applicant at the time of the application. If neither of these are in a participating member state, the law of the participating member state in which the applicant had a place of business at the time of the application will be used. If the applicant had no place of business in any participating member state at that time, the law of the country in which the European Patent Organisation is headquartered will apply (i.e. German law).

Whilst this initially appears simple, it does beg the question of what happens under the second case if the applicant had places of business in multiple participating member states at the time of filing. Over time, the national courts have developed their own laws relating to the treatment of a classic European Patent as an item of property, which could leave the door open to forum shopping in the Unitary Patent system for the jurisdiction most favourable in entitlement terms for the party bringing the action. An equivalent to this scenario is not present under the Protocol on Recognition for the classic European system. The national courts will not therefore have any guidance from previous case law to look to. It will be interesting to see how such disputes relating to jurisdiction over entitlement issues are dealt with.

Joint-inventors

An extra layer of complexity is also present when identifying the national law to be used if there are co-applicants for a patent. This is covered in more detail in a previous article (link here), suffice to say that if the applicants have residences/principal places of business in different participating member states, the law of the location of the first listed applicant will take precedence. The same situation applies in the event that both have only a place of business in a participating member state. Since the laws on joint ownership vary between jurisdictions, the order of the co-owners on the application may prove critical down the line.

Dealing in rights

This regime for determining which national law applies also applies more generally to any issue that arises when treating a Unitary Patent as an item of property. The relevant national law under the regulation will, for example, prescribe the formalities for validly licensing and assigning the Unitary Patent in question and will also determine the default rules which apply to each co-owner’s ability to deal with and exploit a jointly-owned Unitary Patent (to the extent that the co-owners have not varied their respective rights and obligations contractually).

Finally, and somewhat intriguingly, the UPR also notes under Article 5, that the scope of the acts of infringement covered by unitary patents is determined by the national law of the territory determined under the rules above. Early indications are that the Court may interpret that rule to simply point back to the UPC Agreement on the basis that national laws cannot by definition have any substantive teaching about unitary patents (as opposed to European patents). Whether the ultimate arbiter as to the meaning of the UPR – the CJEU – agrees with that position remains to be seen…