Friday, July 9, 2021

All systems are go for the Unified Patent Court: Federal Constitutional Court of Germany deems complaints meritless

The Bundesverfassungsgericht (Federal Constitutional Court of Germany) just published a decision dated June 23, 2021, according to which three pending complaints over the Unified Patent Court (UPC) Agreement are meritless, which is why the top German court does not prevent the country's federal president from signing the UPCA into law.

The court denied the motions for a preliminary injunction because the constitutional complaints in question are inadmissible. In other words, not only is there no preliminary injunction but there is no basis for any further proceedings. The complaints are dead in the water as the court believes they fail to substantiate any violation of complainants' constitutional rights.

German IP litigator Oliver Loeffel ("Löffel" in German) of the Loeffel Abrar firm kindly clarified the definitive nature of this decision when I asked him on Twitter.

If the Federal Constitutional Court had identified any structural concerns regarding the UPC, the agreement would have had to be renegotiated, which could have taken years and would not even have been certain to lead to a near-term resolution.

Generally speaking, the Federal Constitutional Court tends to give the government less than a slap on the wrist when it comes to European cooperation (be it about European Union institutions such as the European Central Bank or, in this case, a treaty involving EU member states as well as other European countries). All other things being equal, the Supreme Court of the United States would be far more likely to declare a legislative measure unconstitutional.

I would expect the UPC to be similarly "injunction-happy" as the German judiciary, especially when cases are filed with the regional UPC divisions in the three German patent litigation hotspots (Munich, Mannheim, and Dusseldorf).

For a transitional period, plaintiffs will have the choice between national courts and the UPC. The UPC will have relatively few full-time judges. Some judges will divide their time between national courts and the UPC. The UPC will have to hand down some spectacular plaintiff-friendly rulings to attract many complaints.

I have to give this more thought, but the fact that the UPC may commence its operation very soon (sometime next year, I guess) may also require an adjustment of my plans regarding a subscription service--not in the short term (i.e., the remainder of this year), but thereafter I believe my subscribers would also be very interested in how the case law of the UPC evolves.

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