UPC Report 02|25

UPC has jurisdiction for the period prior to the UPCA’s entry into force

The Munich Local Division has clarified that the UPC is competent in respect of the entire period of time relevant to an action for infringement, i.e. also in respect of acts of use prior to the UPCA’s entry into force and prior to the withdrawal of any declared opt-out (order of 10 February 2025 – UPC_CFI_342/2024). According to the Munich Local Division, the competence of the UPC revives upon the withdrawal of an opt-out and then extends back in time for an unlimited period, Article 32(1)(a) UPCA, Article 2(g) and Article 3(c) UPCA. The Munich Local Division specifically left open the question of which law will apply to acts that took place before the UPCA’s entry into force or during any opt-out period. According to the Munich Local Division, the questions of the UPC’s competence and of applicable law are different issues and must be considered separately (in a decision on the merits and not just – as in this case – on the objection).
 

Comprehensive disclosure of information in summary proceedings

The Court of Appeal has ruled that the UPC may order the disclosure of information under Article 67 UPCA even in proceedings for provisional measures, provided that the applicant has an urgent interest in the information and that the court’s order is proportionate (order of 14 February 2025 – UPC_CoA_382/2024).

The Court of Appeal confirmed the urgent interest and proportionality in respect of information on (i) the origin and distribution channels of the infringing products, (ii) the quantities of infringing products delivered, received or ordered, and (iii) the identity of all third parties involved in the manufacture or distribution of the infringing products, because the applicant had an interest in preventing further patent infringements. While any claimant is likely to have this interest in any patent dispute, the Court of Appeal did not ask for further substantiation, which is somewhat surprising with respect to the disclosure of the quantities of infringing products. However, according to the Court, there was no urgent interest in price information for the infringing products because this information was primarily relevant to the calculation of damages in the proceedings on the merits.

In the German legal system, a right to information is traditionally only available in proceedings for provisional measures if there are special circumstances, i.e. if there is an obvious legal infringement (section 140b(7) Patent Act (Patentgesetz). There is good reason for this because, once given, information cannot be taken back and is virtually impossible to compensate for in monetary terms. The purpose of proceedings for provisional orders is limited to an interim solution, which is why orders for measures of a final nature are generally available only in proceedings on the merits. The decision does not address this issue.

Interpretation of means-plus-function features

The Court of Appeal (order of 14 February 2025 – UPC_CoA_382/2024) has confirmed the principles of interpretation laid down by the Court of Appeal in the NanoString/10x Genomics decision of 26 February 2024 (UPC_CoA_335/2023) and also provided guidance on interpreting claims features specifying a function:

As a general principle of claim interpretation, means-plus-function features (“means for ...”) must be understood as any feature suitable for carrying out the function. The case in question concerned a “base portion” claimed to be “configured to be adhered to the skin surface [...] by an adhesive patch”. The Court of Appeal interpreted this as a “means-plus-function” feature and held that the expression “configured to” must be interpreted to mean “suitable for” and not in the narrower sense of “adapted for” – but without explaining the distinction further. The Court of Appeal appears to consider it unnecessary for the feature to have undergone special adaptation in terms of functional suitability and to accept any feature suitable for carrying out the specified function. This understanding is informed by the fact that the defendant had pointed to the EPO Guidelines, according to which, for computer-implemented inventions, the wording “means for ...” must be interpreted in the sense of “adapted to”, which must be understood to mean that a feature is not only suitable for carrying out the functions but has been specially designed to do so (T 410/96), which the Court of Appeal does not adopt for its claim construction.

Draconian fines for non-compliance with court orders

In preliminary injunction proceedings, the Court of Appeal threatened the respondent with a penalty payment of “EUR 10,000 for each violation of, or non-compliance with, the order(s), plus EUR 100,000 for each day [...] that the violation or non-compliance continues” (order of 14 February 2025 – UPC_CoA_382/2024). This is noteworthy for two reasons:

First, the ordered threat of a penalty payment also extends to any failure to comply with the obligation to provide information (including the identity of all third parties involved in the production or distribution of the infringing products) and to submit “appropriate documentation” substantiating this information. This indiscriminate approach means that the party obliged to provide information must pay EUR 100,000 for each day of non-compliance with this obligation – whether due to the negligent failure to disclose the identity of a person involved in distributing the products or because the Court, after months of litigation, finds that the documentation was not “appropriate”. The party obliged to provide information therefore faces draconian fines even for minor offences.

Second, the Court of Appeal states in the grounds for the order that only the threat of a penalty payment of EUR 10,000 for each product with which the orders are violated or (alternatively) at the appellant’s choice, EUR 100,000 for each day that the violation continues, is appropriate. The operative provisions, which explicitly order the additional EUR 100,000 per day – also for non-compliance with the obligation to provide information – are not supported by the grounds for the order. This order confirms the growing impression that the Second Panel of the UPC Court of Appeal is more inclined to use a blunt instrument than a delicate touch.

Ceiling for recoverable costs in cases involving several parties

The Nordic-Baltic Regional Division has taken the view that the recoverable costs of representation in cases involving multiple defendants or plaintiffs are capped at a collective ceiling – i.e. the ceiling determined by the Administrative Committee (Annex to Decision of the Administrative Committee of 24 April 2023) applies as a joint ceiling for all defendants or for all plaintiffs (order of 17 February 2025 – UPC_CFI_527/2024). This makes it “worthwhile” for plaintiffs to sue several defendants in one proceeding. It remains to be seen whether the Court of Appeal will confirm this interpretation, which may generally put defendants at an disadvantage.

Inadmissible extension – not the EPO’s “gold standard”

The Court of Appeal appears to apply a more generous standard than the EPO’s Boards of Appeal when it comes to the issue of the inadmissible extension of subject-matter. The Court held that the disclosure includes not only what the skilled person would, as of the priority date, derive directly and unambiguously from the whole of the application as filed using his common general knowledge, but also implicitly disclosed subject-matter, i.e. “matter that is a clear and unambiguous consequence of what is explicitly mentioned” (order of 14 February 2025 – UPC_CoA_382/2024). Applying this rather vaguely phrased standard, the Court of Appeal found that the unallowable intermediate generalisation assumed by the Local Division did not exist, although, like the Local Division, it considered the presence of the (omitted) feature – sealing the contacts – to be essential to the invention and only the method of sealing mentioned in the disclosure (an elastomeric or elastic material) not to be essential to the invention. Given the circumstances of the case at hand, this outcome seems to suggest that the Court of Appeal did not actually apply the EPO’s gold standard. If the UPC Court of Appeal’s generous approach to inadmissible extension is confirmed in future decisions, this will have to be taken into account in future when considering whether to file an opposition against a European patent.