European Parliament not fooled by hearing of the patent microcosm

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On Tuesday October 11st 2011, the Committee on Legal Affairs (JURI) of the European Parliament held a hearing on the unitary patent regulation and the associated agreement on a unified patent court. Although people heard on this occasion, who were all closely tied to the “patent microcosm”, have had the opportunity to expose their views on the project, some Members of the European Parliament (MEPs) have pointed out the major issue at stake: the degree of autonomy the European Union (EU) wants to leave to the European Patent Office (EPO).

A panel of the “patent microcosm”

For sure, people invited to this hearing were all high-profile experts of the European patent system. But what is striking is that nearly all of them have interests in the growth of the patent bubble. So let's have a look at the composition of this panel and how each of the speakers sees relations between the “patent microcosm” and the European Union institutions.

The president of the EPO, Benoît Battistelli had the longest tribune during this hearing: more than half an hour out of two hours and an half, i.e. 1/5 of the overall time. This is a cause for concern since we have already pointed out that one major drawback in the Commission's proposal for the unitary patent regulation is that it is too EPO-centric. Here, the president of the EPO, behaving like a door-to-door salesman selling its company as a market leader, has plenty of time to promote the benefits of striking a deal with his office. And he hasn't missed the opportunity to offer amendments which would make the regulation fit even more perfectly EPO needs. This is quite obvious in the following video extract, where Mr Battistelli is trying to reassure MEPs about links between EPO and EU:

There are many mistakes in this simple extract that need to be corrected in order to not be misled. Mainly, Mr Battistelli's assertion that decisions of the EPO internal Boards of Appeals can be appealed before national courts, which can in turn refer the issue to the European Court of Justice (ECJ) for a preliminary ruling, is in direct opposition with the opinion of Advocates General of the ECJ, stating that:

the decisions of the EPO concerning patents can only currently be reviewed by the internal chambers of appeal created within the EPO, excluding any judicial appeal before an external court. There is no possibility of the European Court of Justice ensuring the correct and uniform application of Union law to proceedings taking place before the chambers of appeal of the EPO.

Therefore, MEPs should actually be concerned by the role left to the EPO with regards to the EU legal and jurisdictional framework. The next speaker, Stephen F. Jones, a British patent lawyer (partner and head of the Patents Group at Baker&McKenzie LLP), has actually contradicted the president of the EPO about his example of a preliminary ruling concerning Monsanto:

Indeed, in direct opposition to Mr Battistelli's allegations, this case has already been judged last year. Moreover, the ECJ had a say in this case because an EU directive on biotechnological inventions was involved. But nothing in ECJ caselaw clarifies whether a question relating to some issues of substantive patent law, which are not already included in some EU legislation, can be referred to the ECJ or not.

But let's go on with the presentation of invited speakers to the conference, with Pierre Véron, a French patent lawyer and professor. Mr Véron is also the former president of the European Patent Lawyers Association (EPLAW), which, as we have previously shown, can be seen as a representative of the “patent microcosm”. In his introduction, he doesn't hide how EPLAW is close to the chairman of JURI, Klaus Heiner Lehne. This explains why, as we have already noted, Mr. Lehne was the first MEP to officially put forward EPLAW's opinion, and who can be held as responsible for the agenda of this meeting:

We will come back later on Mr Veron's arguments, since they are related to one of the core issues in the unitary patent regulation. But for now, it is important to note that the next speaker is also acquainted with the chairman of the JURI committee. Indeed, Judge Dr. Thomas Kühnen is a judge at the Appeals Court of Düsseldorf, the biggest court in Europe regarding patent litigation, with a reputation of being more favourable to patentees. Klaus-Heiner Lehne is not only a German conservative Member of the European Parliament, he is also employed by Düsseldorf law firm Taylor Wessing. In other words, Mr Lehne is likely to advise some customers on some cases judged by Mr. Kühnen. That might explain why the JURI chairman has introduced the Judge with a lot of deference, while other speakers have been simply presented:

It should also be noted that, as mentioned by Mr Lehne in this introduction, some members of the JURI committee have been invited in May 2011 to visit the Dusseldörf Patent Court and have met Judge Kühnen on this occasion. This is quite important given that current works on an agreement for a unified patent court, for which Klaus-Heiner Lehne has been held rapporteur to give an opinion for the European Parliament, are drawing up this unified patent jurisdiction based on the model of the German patent system, for example with a separation of disputes concerning patent validity from those on infringements, or the involvement of technical judges besides legal judges.

The next speaker was the economist Bruno Van Pottelsberghe, who is apparently one of the Commission's favourite economists about patent matters. It can be deplored that Mr Van Pottelsberghe hadn't take the opportunity of this hearing to warn MEPs about giving too much powers to the EPO, as he has written in one of his recent paper:

The board [of the EPO] could therefore be criticized to favor quantity over quality of patents because this strategy is expected to raise national patent offices revenues and maintain their national demand for patents.

Finally, the last speaker was Thierry Sueur, Chairman of BUSINESSEUROPE1's “Patents” Working Group. He's also a member of the Board of the French Patent Office, Chairman of the IP Committee of the French business Federation (MEDEF), the Vice‐President for Intellectual Property and for European & International Affairs of AIR LIQUIDE and the President of the French Group of the International Association for the Protection of Intellectual Property (AIPPI). In short, Mr Sueur is actually a famous member of the patent microcosm, and has been one of the most dedicated promoters of software patentability in Europe. He's mainly known as Mr “I'm the industry“, since in his public appearances he always present his opinions as those of the Industry in general. And this hearing was not an exception to the rule, while Mr Sueur doesn't actually represent the industry's point of view, just those of some legal departments.

EU's vs EPO's oversight of patent policy

There was not much expectation to have with such a panel. Indeed, most speakers have dwelt on praising the setting up of a unitary patent along with a unified patent court. But in the midst of the sales talk that was droning on, a major issue was raised by the shadow rapporteur of the liberal group (ALDE), Cecilia Wikström:

The Swedish MEP's question is somewhat ambiguous. One the one side, she pushed forward one of the modifications suggested by EPLAW, i.e. to move articles 6-9 from the unitary patent regulation to the agreement on the unified patent court. Still, her question has put the finger on the main issue of this regulation: the degree of control of the patent policy that is left to the EPO or conversely kept under the responsibility of EU democratic institutions.

EPLAW has justified shifting articles 6-9 from the unitary patent regulation to the agreement on the unified patent court as follows:

There should be no EU rules of patent infringement. The most serious drafting error constitutes the inclusion of the Articles 6 to 8 into the Proposed Regulation. Rules with identical wording can be found as Articles 14f, 14g and 14h of the Draft Agreement. These articles (on ‘direct infringement’, on ‘indirect infringement’, and on ‘limitations’) set out the substantive law on patent infringement, based upon the corresponding provisions of the Community Patent Convention. The inclusion of these substantive rules into the Proposed Regulation will make them a matter of Union law with the result that an unpredictable number of referrals to the CJEU must be expected in an area which often is the core of a patent case.

This is EPLAW – and, by extension, “patent microcosm” –'s core request: they do not want the ECJ to poke its nose in their patent matters. The reason is very simple, as Mr Véron has stated during this hearing:

To put it another way, the “patent microcosm” wants a jurisdiction of exception, with no regular judge but only members of their microcosm, so they can predict the outcome of litigations. And in case it was not clear enough, Mr Véron has insisted that this was more important than having a fair trial:

Fortunately, the few MEPs who have attending this hearing haven't seemed convinced by this rhetoric. The Austrian Green MEP Eva Lichtenberger has rightly questioned the fact that the granting process of the unitary patent has been delegated to a non-EU body:

And the French Socialist MEP Françoise Castex has perfectly made clear that the unitary patent regulation has no other choice than bringing the role of EPO and the unitary patent itself under the auspices of EU Law:

The answer of the EPO President to these concerns is worth to listen:

This answer is blatantly misleading! As we have already demonstrated, and contrary to Mr Battistelli's assertion, the only way to guarantee that acts delegated to the EPO can be referred to the ECJ, is to reaffirm the autonomy of the unitary patent.

As a side note, Mr Battistelli has just repeated here the EPO lingo to justify that it doesn't grant patents on “software as such“, meaning that there is some software which are not “as such“ and can therefore be patentable. Unfortunately for the president of the EPO, some recent patent litigations have proven that patent on pure software functionalities have been granted by the EPO, and have actually led to a distortion of competition on the Dutch market with regard to smartphones.

But once again, the president of the EPO has not managed to convinced MEPs, as Mrs Lichtenberger has put it at the end of the hearing: the proposed patent system suffers from a lack of democratic scrutiny:

What should be learnt from this hearing is that the amendments we are proposing are needed more than ever to answer concerns raised by MEPs. In particular, our amendment n° 3, by proposing to reaffirm the autonomy of the unitary patent, would clarify that issues of substantive patent law are subject to EU democratic scrutiny. We encourage European citizen to contact MEPs, asking them to support these amendments and to ask for another hearing in order to present alternative views and all sides of the issue.

  • 1. According to Wikipedia, BUSINESSEUROPE – the Confederation of European Business – formerly the Union of Industrial and Employers' Confederations of Europe (UNICE), is a Brussels-based European association of industries and employers, whose members are 41 central industrial and employers' federations from 35 countries.