Jüngst and Schroeder on Damages for Wrongly-Issued Preliminary Injunctions in the UPC

I commend to readers’ attention an article by Oliver Jan Jüngst and Moritz Schroeder titled ֦PI damages֞:  Revocation of provisional measures and compensation of the Defendant under R.213.2 RoP, 2025 GRUR Patent 340.  Here is the abstract:

The tide can turn in any patent case for various reasons – e.g. if a patent is revoked at some point.  Yet, what can be done to compensate for damages incurred by a party because of provisional measures being granted on the basis of said patent?  The economic consequences of such a measure can be severe and hence, a compensation mechanism is necessary to strike a fair balance between the interests of right holders and other parties as emphasized in the UPCA considerations.  While the RoP indeed provide for a compensation in R. 213.2 RoP, once again, the specific assertion raises many questions, some of which are presented here.

The authors state that, to their knowledge, there are at present no cases in which the UPC has addressed the compensation due to a defendant who is preliminarily enjoined on the basis of a patent that is subsequently determined to be invalid or not infringed; and the wording of the relevant provisions, namely article 60(9) of the UPCA (read in conjunction with article 62(5)) and Rule 213.2 of the Rules of Procedure, require some interpretation.  The authors suggest that there may be no uniformly correct answers in regard to the court (first instance or appellate) in which the claimant should seek relief, or the deadline for filing its claim   And while they do not discuss the CJEU’s decision in Mylan v. Gilead (previously noted on this blog here), which holds that a regime of strict liability is compatible with IPRED article 9(7)—and they note that the wording of Rule 213.2 suggests a discretionary standard (“. . . the Court may order”)—they imply that it might make sense for the UPC “to ‘mirror’ its developing practice of allowing injunctions on a regular basis . . . via also regularly finding the general liability of a PI applicant under R. 213.2 RoP if a PI is lifted at a later stage.”  They also suggest that, in an appropriate case, liability could include not only the accused infringer’s lost profits but also other expenses incurred as a result of the injunction, and (perhaps) even losses suffered outside the UPC territory if these are caused by the injunction.

In the same issue of GRUR is Hans-Jürgen Ahrens’ article Schadensersatz nach aufgehobener einstweiliger Verfügung wegen nichtigen Arzneimittelpatents—zugleich Besprechung von BGH GRUR 2025, 574—Glatirameracetat (“Damages following a preliminary injunction vacated on the basis of an invalidated drug patent—the German Federal Supreme Court’s Decision in Glatiramer Acetate, GRUR 2025, 574").  The decision under consideration—BGH, Judgment of March 13, 2025,  IX ZR 201/23, previously noted on this blog here under the heading “Update” —holds, inter alia, that consistent with previous German case law and the Mylan decision, the patentee can be held strictly liable to the wrongly-enjoined party for the latter’s damages attributable to the injunction, though not (as a general matter) the patentee is not liable to affected third parties (here, a sister corporation of the accused infringer to whom the latter had leased its business); and that the claimant cannot also recover the patentee’s profit attributable to the wrongly-issued injunction (though it may be possible for the amount of the patentee’s profit to serve as evidence of the claimant’s damages, if I understand correctly).  (Regarding the issue of recovering the patentee's profits, cf. the recent EWHC decision to similar effect, noted here.)