Is the proposed EU unitary patent system flawed?

The Guardian has published a succinct and compelling run-down of the flaws in the new draft EU unitary patent system. Here are some of the highlights:

[It will] take effect across the EU, except in Spain and Italy.

Implementation will be piecemeal and nothing can come into being until the Court system has been set up. The agreement creating it is likely to be signed in February and that then needs to be ratified by thirteen contracting states (which must include the UK, France and Germany). The expectation at EU level is that this will happen by April 2014, but that is highly unlikely. The earliest the system will be in place is the end of 2014 or early 2015.

The technology sector is concerned. The new single enforcement system (which will apply to most existing patents as well as Unitary ones) may be a boon for patent trolls. Companies such as Motorola and Nokia, which has been very vocal on the subject, have been faced with multiple actions in recent years by patent holding companies seeking to monetise patent portfolios they have acquired. These patents should be licensed under the standards rules, but price can be an issue and there are thousands of them. Although they are usually held to be invalid, phone makers face pressure to settle because if they don’t they could be injuncted.

IPCopy has also exposed the possible consequences of article 58 (dealing with the transitional provisions):

  • There will be a transitional period of at least 7 years (i.e. until 1 January 2021), which may be extended by a further 7 years (i.e. until 1 January 2028).

  • Up until 1 month before the end of this transitional period, a proprietor of or an applicant for a European patent granted or applied for prior to the end of the transitional period may opt out of the exclusive competence of the unified patent court.

  • The proprietor or Applicant can withdraw the opt-out at any time.

By our calculation, this means that an Applicant can file a patent application up until 30 November 2020, and, on filing, opt out of the unified court system, giving the national patent courts competence for the life time of the patent, until 30 November 2040. If the Applicant changes its mind, it can opt back in again at any time.

If the transitional period is extended by 7 years, this will apply to patent applications filed up until 30 November 2027, giving the national patent courts competence until 30 November 2047!

The final agreement isn’t expected to be signed until February/March.