I confess that I'm still a bit confused about whether the Unified Patent Court, assuming it eventually comes into existence, will develop and apply its own body of law relating to injunctions and damages, or whether it will mostly apply the laws of member states. As I noted on Sunday, article 68 of the Unified Patent Agreement states that courts "may" grant injunctions, and Rule 118(2) of the Draft Rules of Procedure (I referred to them as Draft "Regulations" on Sunday--sorry) says that "In appropriate cases and at the request of the party liable to the orders and measures provided for in paragraph 1 the Court may order damages and/or compensation to be paid to the injured party instead of applying the orders and measures if that person acted unintentionally and without negligence, if execution of the orders and measures in question would cause such party disproportionate harm and if damages and/or compensation to the injured party appear to the Court to be reasonably satisfactory." Article 24 of the Agreement, however, entitled "Sources of Law," states that:
(1) In full compliance with article 20 ["The court shall apply Union law in its entirety and shall respect its primacy"], when hearing a case brought before it under this Agreement, the Court shall base its decisions on
(a) Union law, including Regulation (EU) No. 1257/2012 and Regulation (EU) No. 1260/2012;
(b) this Agreement;
(c) the EPC;
(d) other international agreements applicable to patents and binding on all the Contracting member states; and
(e) national law.
(2) To the extent the Court shall base its decision on national law, including where relevant the law of non-Contracting states, the applicable shall be determined
(a) by directly applicable provisions of Union law concerning private international law rules, or
(b) in the absence of directly applicable provisions of Union law or where the latter do not apply, by international instruments containing private international law rules; or
(c) in the absence of provisions referred to in points (a) and (b), by national provisions on private international law as determined by the Court.
(3) The law of non-Contracting states shall apply when designated by the application of the rules referred to in paragraph (2), in particular in relation to articles 25 to 28, 54, 55, 64, 68, and 72.
Moreover, article 7 ("Treating a European patent with unitary effect as a national patent") of Regulation (EU) 1257/2012 states that:
1. A European patent with unitary effect as an object of property shall be treated in its entirety and in all the participating Member States as a national patent of the participating Member State in which that patent has unitary effect and in which, according to the European Patent Register:
(a) the applicant had his residence or principal place of business on the date of filing of the application for the European patent; or
(b) where point (a) does not apply, the applicant had a place of business on the date of filing of the application for the European patent.
2. Where two or more persons are entered in the European Patent Register as joint applicants, point (a) of paragraph 1 shall apply to the joint applicant indicated first. Where this is not possible, point (a) of paragraph 1 shall apply to the next joint applicant indicated in the order of entry. Where point (a) of paragraph 1 does not apply to any of the joint applicants, point (b) of paragraph 1 shall apply accordingly.
3. Where no applicant had his residence, principal place of business or place of business in a participating Member State in which that patent has unitary effect for the purposes of paragraphs 1 or 2, the European patent with unitary effect as an object of property shall be treated in its entirety and in all the participating Member States as a national patent of the State where the European Patent Organisation has its headquarters in accordance with Article 6(1) of the EPC.
4. The acquisition of a right may not be dependent on any entry in a national patent register.
Jean-Christophe Galloux and Bertrand Warusfel go into considerable detail in their recent article Le Brevet Unitaire et la Future Jurisdiction Unifieé, 47 Propriétés Intellectuelles 152, 158-60 (2013), on how this provision (relevant only to European patents with unitary effect, not other European patents) compares with other sources of Union law on private international law. Of these, the Regulation (EU) 864/2007 (Rome II) would appear to be relevant. Article 8 of this regulation, titled "Infringement of Intellectual Property Rights," states:
1. The law applicable to a non-contractual obligation arising from an infringement of an intellectual property right shall be the law of the country for which protection is claimed.
2. In the case of a non-contractual obligation arising from an infringement of a unitary Community intellectual property right, the law applicable shall, for any question that is not governed by the relevant Community instrument, be the law of the country in which the act of infringement was committed.
3. The law applicable under this Article may not be derogated from by an agreement pursuant to Article 14.
So, to get back to the question of the day, are the remedial provisions of the Agreement and the Draft Rules of Procedure going to be determined by national law, or by some to-be-developed body of Union law? If the former, does that mean we will continue to have varying rules on matters such as whether negligence is presumed (and hence whether injunctive relief is mandatory) and on how to calculate lost profits, reasonable royalties, and defendants' profits? In their paper The Unitary Patent Package: Twelve Reasons for Concern, available here, Reto Hilty, Thomas Jaeger, Matthias Lamping, and Hanns Ullrich expressed concern that (what was to become article 7 of Regulation 1257/2012) would result in a fragmentation of rules:
This means that to a given unitary patent only one national law would apply throughout the territories of enhanced cooperation. Yet it also means that different national laws would apply to different unitary patents. Therefore, instead of creating uniformity, a multiplicity of national laws would apply. While some reference to national law is inevitable as a matter of implementing the property rules of patents, the UP Regulation misses an opportunity to provide for a minimum of uniformity and transparency for market actors.
But does this concern apply only to the nature of the property right, or also to the remedies for its infringement? Note that Bundesgerichtshof Judge Dr. Klaus Grabinski, in his recent paper Der Entwurf der Verfahrensordnung für das Einheitliche Patentgericht im Überblick, GRUR Int. 2013, 310, 316, cites Draft Rule 118(2) in stating that "Ausnahmsweise kann das Gericht von der Verurteilung insbesondere zur Unterlassung und zu den korrigierenden Maßnahmen absehen, wenn die Voraussetzungen von Art. 12 der Richtlinie 2004/48/EG des Europäischen Parlaments und des Rates von 29.4.2004 über die Durchsetzung der Rechte des geistigen Eigentums, die in die Verfahsrensordnung übernommen wurden, gegeben sind" ("Exceptionally, the court may put aside the judgment especially with regard to an injunction and corrective measures, if the conditions of article 12 of the [2004 Enforcement Directive] which were taken over into the procedural rules, are present"). So maybe, as I suggested on Sunday, courts will apply Draft Rule 118(2) without necessarily deferring to the presumption of negligence that otherwise might be applicable under some states' laws?
I admit I'm not an expert on European private international law; perhaps matters are simpler than I am making them out to be. Or maybe someone has already definitively expounded on this topic in some paper I haven't yet located. My view at present, however, is that this would be a great topic for some aspiring law professor's dissertation topic. (After all, one could start such a dissertation today and probably have it completed long before the Unified Patent Court actually comes into existence.) If any of my readers can illuminate me on these matters, I'd welcome your thoughts.