Patent litigation reform in Europe : Set up an alternative dispute resolution system for SMEs

Jonathan Zuck,  President, Association for Competitive Technology (ACT)

Innovative SMEs would be among the main beneficiaries, since litigation costs and legal uncertainty during lengthy court proceedings are key barriers preventing innovative businesses from protecting their inventions.

The Association for Competitive Technology (ACT) welcomes the proposals by the Portuguese and Slovenian Presidencies to use ADR in patent disputes. ACT specifically suggests

• Empowering judges to require that mediation be attempted as a first step in litigation involving intellectual property rights;

• Creating procedural incentives to resolve a dispute through mediation

i.    By keeping court fees low if the dispute is resolved through mediation;

ii.    By allowing questions of validity to be discussed during the mediation phase, while disallowing counter-claims for invalidity during contentious infringement proceedings. ACT proposes that counter-claims for invalidity normally be barred in infringement proceedings, but that the recognition of the validity of a patent may be an element of a mediated agreement between the parties. In ACT’s view, the validity of a patent can usefully be the object of mediation.

Nothing should prevent one party from  agreeing to an amicable solution to an infringement claim under the condition that the other party recognises the validity of the patent. Of course, a mediated agreement between the parties to a dispute to recognise (or not to recognise) the validity of a patent would be effective only inter partes, and not erga omnes – since the patent right was granted by the government as a matter of a “public trust”, it should only be invalidated erga omnes by a government institution.

ACT also suggests further measures to help SMEs including:

• Using the IPR Helpdesks as reference points to provide a “roadmap to ADR”;

• Channelling relevant information and policy guidelines on ADR through the SME’s Policy Portal by DG Enterprise;

• Supporting “soft law” initiatives such as the European Code of Conduct for Mediators.