Decision making at the UPC: Robotics & Software
The UPC’s tools for information gathering to obtain evidence of infringement under certain jurisdictions may prove to be particularly useful in the robotics and software sector

Robots and software are essential to the modern way of life, so much so, that it is hard to think of a product or service that does not involve either at some stage in its manufacture or delivery.

In this article in our series on decision making at the UPC, by using some fictitious exemplary scenarios, we examine some of the issues that companies involved with robotics and software might need to consider when protecting their technology in Europe and enforcing their patents. Of course, the strategy ultimately pursued in any particular situation would be highly dependent on the specific facts involved.

Scenario 1 – a product made by a robotic manufacturing method

Your company manufactures a product using a robot, for example, by a 3D printing method. You have a European patent, covering the method of manufacturing, validated in a UPC territory in which you believe a competitor, NokOff, manufactures a product by the patented method. NokOff’s product is being sold across the EU.

National Litigation Considerations

In most European countries, process claims can be infringed by someone using the patented process. It is also an infringement to offer, use, import, store, etc., a product directly obtained by that process. This provides useful protection, particularly where a product made by the patented process is manufactured outside the patented territory but imported into it.

However, without access to the factory, it can be difficult for patentees to prove that a particular product was indeed made by the patented process. To address this potential imbalance, many jurisdictions, including the UK, Germany, and the UPC, reverse the burden of proof onto the defendant where the resultant product is “new” (UPCA A. 55(1)). In practice, the “new” product requirement means that the claimed process produces a “novel” product, i.e., leaves a unique fingerprint on the product compared to other manufacturing processes such that the fingerprint can be used to determine whether the claimed process was used.

Litigating outside the UPC requires a country-by-country approach to prevent infringing importation or sale of the product. Hence, a primary aim might be to obtain an injunction in the country of manufacture to stop the infringement at source, rather than litigating in every country into which the product is imported and sold. However, unless you can prove that the patented process is used on the basis of your own evidence, part of the challenge in obtaining an injunction at a national court is using the local evidence-gathering powers and any reversal of the burden of proof, to the extent that this is possible at the national court.

Whilst this approach, when combined with electing to opt out the patent from the UPC, works to shield a patent from the risk of central revocation, it may not be effective, for example, if NokOff moves the manufacturing elsewhere requiring fresh infringement proceedings, or successful, for example, if the national court’s evidence gathering powers are insufficient or the burden of proof is not reversed leaving the infringement unproven. In particular, where the process does not produce a “new” product, i.e., leaves no tell-tale fingerprint on the product and a variety of processes could have been used to make it, some jurisdictions do not reverse the burden of proof, leaving the patentee to prove infringement. Litigation at the UPC may remedy these pitfalls to some extent.

UPC Litigation Considerations

At the UPC, the burden of proof is also reversed where there is a substantial likelihood that the identical product was made by the patented process and the proprietor has been unable, despite reasonable efforts, to determine the process actually used to make the product (UPCA A.55(2)). Whilst the practical meaning of “substantial likelihood” and “reasonable efforts” has not yet been interpreted by the court, it should at least be easier for patentees to shift the burden of proof on to defendants than in many national courts.

As discussed in our earlier article, the UPC also provides patentees with many tools for obtaining evidence of infringement under certain jurisdictions, particularly useful if a process is being used in a UPC country with more limited national procedural tools for information gathering. Most notably the UPC provides for orders to produce evidence (UPCA A.59), to preserve evidence (“saisie”, UPCA A.60(1)–(2)), and for inspection of premises (UPCA A.60(3)). In this scenario, a saisie or inspection of premises, both of which can be granted ex parte if necessary, would allow you to obtain the evidence you need to support your case. Whilst saisies are unavailable in many jurisdictions, the UPC has already shown itself to be willing to grant these extremely quickly and ex parte (Oerlikon Textile GmbH & Co KG v others, in the Milan Local Division), similarly, the UPC has granted ex parte and within a day an inspection measure (Jozef Frans Nelissen v OrthoApnea S.L., in the Brussels Local Division).

Furthermore, any injunction granted by the UPC would cover all those UPC states where the patent had been validated if that is what the patentee requests. It would therefore be easier to roll up the infringing imports across all of those states in one fell swoop and reduce the impact of NokOff moving to a new manufacturing location or changing its distribution chain.

Although as yet untested, it is possible that the UPC might be willing to issue evidence gathering orders, such as saisies, in UPC countries where a competitor operates but the patent is not validated. For example, even if the patent is not validated in a UPC country where NokOff manufactures, a UPC saisie may be obtained in that country in order to preserve evidence to demonstrate that the patented process is used to produce a product that infringes in a second UPC country (where the patent is validated). Relief against NokOff might then be obtained in that second country. Whether or not the UPC will act in this way is yet to be seen.

In this scenario, therefore, the advantages of leaving your patent in the UPC might well outweigh the risks of central revocation.

Scenario 2 – software patents

Your company is a software company which licences its software products to third parties for installation on their hardware. For example, you might have developed software that controls autonomous vehicles that car manufacturers install on their vehicles. You have a granted EP patent covering the software and a pending EP divisional application. You suspect that a third party (and potential licensee) is installing software in their latest hardware, e.g., self-driving car, that infringes your patents.

Whilst litigation proceedings could be brought against the third party, as an initial tactic this could be a bit heavy-handed given the potential licensing agreement that could be achieved. Licensing discussions with the third party might be opened on the basis of the presence of the granted EP patent. However, companies wishing to use their patents to licence their technology may be cautious about the risk of central revocation at the UPC. Thus, it may be advisable to opt-out your EP validations from the UPC, before contacting the third party to highlight the presence of your patent and discuss potential licensing options, so as to avoid them bringing a central UPC revocation action in response.  However, given that it may ultimately prove necessary to at least start enforcement proceedings against an infringer in order to precipitate a licence agreement, is opting out of the UPC necessarily the best strategy in this scenario?

Choice of venue is a very important consideration when contemplating enforcing a software patent, if that is thought necessary. One of the key difficulties is establishing whether an infringing product uses the patented software. Hence, a court’s disclosure requirements and evidence gathering powers are worth considering.

As mentioned above, the UPC has more extensive evidence gathering powers than many national courts, for example, it can issue orders to disclose specified evidence (UPCA, A.59). Whilst the UPC’s tools might seem helpful at a first glance, it may still be difficult to acquire the original source code to prove your case via a saisie procedure. In this scenario, the UK courts may provide a fast way to demonstrate to third parties that litigation is to be taken seriously.

In lieu of standard disclosure, defendants to infringement in the UK High Court routinely opt to produce a Product and Process Description (PPD) in which the defendant must provide a complete written explanation of its product or process. This is particularly useful for software since the alleged infringer must set out in plain terms how its software works. Material disclosed at trial in the UK cannot be used to support proceedings in other jurisdictions unless it is free from confidentiality restrictions. Although not expressly stated in the UPC’s Rules, it may be that the UPC could also order the production of a PPD, but this is completely untested at present as the order to produce evidence provisions includes a disclaimer that “such order shall not result in an obligation of self-incrimination” (UPCA, A.59.1 last sentence).

Timing is also a factor, especially where part of the purpose of the litigation is to apply pressure to a potential licensee. The Italian and French courts, for example, are comparatively slow, typically taking 18 to 36 months to come to a first-instance decision on both infringement and validity (although the French courts will often decide on damages at the same time). Conversely, the UPC and the UK are quick, with first-instance decisions in around 14 months.

In view of the above, bringing an infringement action in the UK and/or the UPC, partly depending on what evidence gathering powers you think you need, might be a good way of applying pressure on a potential infringer in this scenario.

Scenario 3 – Standard Essential Patents (SEPs)

You also have a patent relating to software governing a communication protocol, for example, the way in which autonomous vehicles communicate with each other. This patent has been designated a Standard Essential Patent (SEP) and you believe it is being infringed.

In July 2023, several disputes involving SEPs were filed with the UPC (Huawei v Netgear, Panasonic v Xiaomi and OPPO), which raises questions as to how the court will handle FRAND cases, if indeed it is competent to do so, given they often involve questions outside of the normal patent infringement/validity issues relating to the licensing of SEPs. Whereas the UK courts have established themselves as a useful jurisdiction for SEP/FRAND disputes, the UPCA does not explicitly address whether the court has jurisdiction to decide on FRAND licences. In particular, the UPCA does not provide legal basis for bringing a claim solely relating to a FRAND question. However, it is possible that the UPC could hear a request for a FRAND licence raised as a defence to infringement since UPCA A32(1)(a) provides that the court has exclusive competence in respect of “actions for actual or threatened infringements of patents and supplementary protection certificates and related defences, including counterclaims concerning licences”. Further exploration of this topic is beyond the scope of this article, but please do speak to your usual contact if you would like more information.

Scenario 4 – robotic hardware

Your company manufactures a component for a robot in a UPC country. A competitor, Actu8or, has a unitary patent (or granted European patent that has not been opted out of the UPC) covering the component. You have just received a letter from Actu8or mentioning the UPC and requesting that you stop manufacturing the component. What do you do?

The letter received from Actu8or should be taken seriously due to the prospect of a preliminary injunction being ordered against you by the UPC within days (even ex parte if there is sufficient urgency as already seen in myStromer AG v Revolt Zycling AG), or within 3 months from service which is the time it took several local divisions to hear inter partes PI requests (Helsinki, Munich, Vienna). The time periods set out in the UPCA and Rules governing the progress of an infringement action are designed to get cases to trial within the space of a year, and early indications are that the court is on track to do this, and so a final injunction could follow PI proceedings within this timeframe.

It may be worth filing a protective letter as soon as possible to defend against the risk of an ex parte injunction being ordered. In such a letter, it is wise to discuss both non-infringement and validity arguments — one of the reasons an injunction was awarded in myStromer despite such a letter being on file was that sufficiently detailed invalidity arguments had not been provided. Even if the application for a preliminary injunction is held at an inter partes hearing, one should be prepared to discuss validity in detail (10x Genomics v Nanostring).

One of the next things you will likely have to consider is whether to file a pre-emptive revocation action at the UPC or one of the national courts. If it is at least arguable that the patent is invalid over prior art which you know about, filing a revocation action may be a good way of exerting pressure back on Actu8or and forcing them to the negotiating table, if that is your intention. For that pressure to be effective, you will probably wish to use a court that reaches first instance invalidity decisions quickly. The Netherlands, French, and Italian national courts typically take around 18 to 36 months to do so. In contrast, the UPC is expected to reach a first instance decision within 14 months.

Other factors will, of course, play into any decision as to where to file a revocation action. For example, if you believe that expert evidence may be important to your case, you may wish to use a jurisdiction where experts are heard, which again may suggest using the UPC which has a role for experts (albeit not to the same extent as the UK) rather than the EPO or Germany where expert opinions are rarely decisive.

If you filed for revocation at the UPC, it is likely that a counterclaim for infringement would follow in turn. You would need to be prepared for a rapid exchange of written briefs and to disclose evidence as the court requires, the UPC having a highly front-loaded procedure and the extensions that have been granted so far came with disclaimers that this should only happen in exceptional circumstances.