List of Tables ............................................... xvii
List of Figures ............................................... xix
Preface ....................................................... xxi
List of Abbreviations ....................................... xxiii
Chapter 1
Why Germany? .................................................... 1
1 Introduction ................................................. 1
2 The German "Split System" .................................... 1
3 Expertise and Reputation of German Patent Infringement
Courts ....................................................... 2
4 Speed and Costs of Proceedings in Germany .................... 2
5 Customs Actions .............................................. 3
Chapter 2
Sources of Law .................................................. 5
1 Introduction ................................................. 5
2 European Laws ................................................ 5
2.1 European Patent Convention .............................. 6
2.2 London Agreement ........................................ 6
2.3 Directives and Regulations of the EU .................... 7
2.3.1 European Enforcement Directive ................... 7
2.3.2 Border Measures Regulations ...................... 8
3 Other International Treaties ................................. 8
3.1 Paris Convention ........................................ 8
3.2 PCT ..................................................... 9
3.3 TRIPS ................................................... 9
4 German Acts ................................................. 10
4.1 German Patent Act ("Patentgesetz": PatG) ............... 10
4.2 German Code of Civil Procedure
("Zivilprozessordnung": ZPO) ........................... 10
4.3 Utility Model Act ("Gebrauchsmustergesetz": GebrMG) .... 11
4.4 Act on Employees' Inventions
("Arbeitnehmererfindergesetz": ArbEG) .................. 11
Chapter 3
Structure of Legal System ...................................... 13
1 Introduction ................................................ 13
2 General Outline of Patent Disputes .......................... 14
2.1 Disputes Focused on the Invalidation of the Patent ..... 14
2.1.1 Oppositions ..................................... 14
2.1.2 Nullity Actions ................................. 15
2.2 Infringement Disputes .................................. 16
2.2.1 Infringement Courts ............................. 17
2.2.1.1 First Instance ......................... 17
2.2.1.2 Second Instance ........................ 18
2.2.1.3 Third Instance ......................... 18
3 Court of Justice of the European Union ...................... 19
4 Role of Judicial Precedent .................................. 20
5 European Patent Court ....................................... 20
Chapter 4
Forms of Patent Protection: Background on Prosecution .......... 23
1 European Patent ............................................. 25
1.1 Granting Procedure ..................................... 25
1.1.1 The EPO's Initial Formality Review and Search
Report .......................................... 26
1.1.1.1 General Remarks ........................ 26
1.1.1.2 Possible Events during the Search
Phase .................................. 27
1.1.1.3 Mandatory Reaction on Search Opinion ... 27
1.1.2 Unity of the Invention .......................... 28
1.1.3 Publication of the European Patent
Application ..................................... 29
1.1.4 Examination Proceedings ......................... 30
1.2 Divisional Applications (Article 76 EPC) ............... 31
1.3 Right of Priority (Articles 87, 88 EPC) ................ 32
1.4 Duty to Disclose ....................................... 33
1.5 Opposition, Revocation, and Limitation Proceedings ..... 34
1.5.1 Nature of Limitation Proceedings ................ 34
1.5.2 Strategic Use of Limitation Proceedings ......... 35
1.6 Observations by Third Parties .......................... 36
2 European Patents with Unitary Effect ........................ 36
2.1 Unitary Character ...................................... 37
2.2 Coexistence with European and National Patents ......... 37
2.3 Application of the EPC ................................. 38
2.4 Language System ........................................ 38
2.5 Enforcement ............................................ 39
3 German Patents .............................................. 39
3.1 Procedure in General ................................... 39
3.2 Amendments ............................................. 40
3.3 Divisional Applications ................................ 41
3.4 Opposition Proceedings ................................. 41
4 German Utility Models (Gebrauchsmuster) ..................... 42
4.1 Main Characteristics of German Utility Models .......... 42
4.2 Different Novelty Standards ............................ 42
4.3 Registration of a German Utility Model ................. 43
4.4 Protectable Subject Matter ............................. 43
4.5 Reasons for Filing a Utility Model ..................... 44
4.5.1 Low Fees and Prosecution Costs .................. 44
4.5.2 Early Publication of the Invention .............. 44
4.5.3 Earlier Enforceability .......................... 46
4.5.4 Damages ......................................... 46
4.5.5 Strategic "Branching Off" ....................... 46
4.5.5.1 General Remarks ........................ 46
4.5.5.2 Tailoring Claims in View of the
Infringing Embodiment .................. 47
4.5.5.3 Claim Sets for German Utility Models
in Case of an Infringement ............. 47
5 Design Protection (Design Patent) ........................... 48
5.1 General Information .................................... 48
5.2 Requirements for Design Protection ..................... 49
5.3 European Community Design .............................. 50
5.3.1 Registered Community Design (RCD) ............... 50
5.3.2 Unregistered Community Design ................... 51
5.4 German Industrial Design (Geschmacksmuster) ............ 51
5.5 International Design (Hague System) .................... 52
Chapter 5
Patentability Standards ........................................ 53
1 Patentable Subject Matter ................................... 53
1.1 Classes of Non-Inventions .............................. 53
1.2 Programs for Computers and Computer Implemented
Inventions ............................................. 56
1.2.1 Technical Character ............................. 56
1.2.2 Other Patentability Requirements ................ 58
1.3 Biotechnological Inventions ............................ 61
2 Novelty ..................................................... 62
2.1 The Absolute Novelty Rule and the First-to-File
Principle .............................................. 62
2.2 Non-Prejudicial Disclosure ............................. 63
2.3 Availability to the Public ............................. 64
2.4 Determination of What is "Public" ...................... 65
2.5 Novelty Assessment ..................................... 66
2.5.1 Introduction .................................... 66
2.5.2 Combination of Features ......................... 67
2.5.3 Meaning of Terms ................................ 67
2.5.4 Incorporations by Reference ..................... 67
2.6 So-called "Article 54(3) Documents" and §3(2) of the
German Patent Act ...................................... 68
2.7 First Medical Use/Second Medical Use ................... 70
3 Patentability Standards Applicable to German Utility
Models ...................................................... 71
4 Standards on Inventive Step ................................. 72
4.1 Introduction ........................................... 72
4.2 Problem and Solution Approach .......................... 73
4.2.1 Step 1: Determination of the "Closest Prior
Art" ............................................ 73
4.2.2 Step 2: Determination of the "Objective
Technical Problem" .............................. 74
4.2.3 Step 3: Obviousness Test ........................ 75
4.3 German National Particularities ........................ 76
5 Standards on Original Disclosure ............................ 76
5.1 Removing a Feature from an Independent Claim as
Originally Filed ....................................... 77
5.2 The So-called "Inescapable Trap of Article
123(2)/(3)" ............................................ 78
Chapter 6
Opposition Proceedings ......................................... 81
1 Introduction ................................................ 81
2 Patent Monitoring Programs .................................. 81
3 Grounds for Opposition ...................................... 82
4 Any Person may Oppose ....................................... 83
5 Main Steps of Oppositions Proceedings ....................... 84
5.1 Notice of Opposition ................................... 84
5.2 Observations and Amendments during the Proceedings ..... 85
5.3 Summons ................................................ 86
5.4 Late-Filed Requests by the Patentee .................... 86
5.5 Late-Filed Facts or Evidence by the Challenger ......... 87
5.6 The Hearing ............................................ 88
5.7 Decision of the Opposition Division .................... 88
5.8 Appeal of Decisions of the Opposition Division ......... 89
6 Withdrawal of Opposition .................................... 89
7 Intervention after the Nine-Month Opposition Period ......... 90
8 Statistics .................................................. 90
9 Interaction of EPO Opposition and National Invalidation
Proceedings ................................................. 90
Chapter 7
Nullity Actions ................................................ 93
1 Split System ................................................ 93
2 Court Structure ............................................. 94
2.1 Federal Patent Court ................................... 94
2.2 Federal Supreme Court .................................. 95
3 Main Procedural Aspects of Nullity Actions .................. 96
3.1 Priority of Opposition Proceedings over Nullity
Actions ................................................ 96
3.2 Parties to the Nullity Action .......................... 96
3.3 Timing of a Nullity Action ............................. 98
3.3.1 Chronology of First Instance (Federal Patent
Court) .......................................... 98
3.3.2 Appeal to the Federal Supreme Court ............ 100
3.4 Object of Nullity Actions ............................. 101
3.5 Grounds for Revocation ................................ 102
3.6 Special Procedural Aspects ............................ 104
3.6.1 Scope of Nullity Actions ....................... 104
3.6.2 Withdrawal of Nullity Actions .................. 105
3.6.3 Amendment of the Nullity Actions during the
Proceedings .................................... 106
3.6.4 Admissibility of Claim Amendments filed
during the Proceedings ......................... 107
4 Inspection of the Files .................................... 107
5 Interplay with Infringement Proceedings .................... 108
5.1 Stays of Infringement Proceedings Pending the
Resolution of Validity ................................ 108
5.2 Effects of the Nullity Decisions ...................... 108
5.3 Inconsistent Statements ............................... 109
6 Financial Aspects of Nullity Action ........................ 110
6.1 Court Fees ............................................
6.1.1 Court Fees: First Instance (Federal Patent
Court) ......................................... 110
6.1.2 Court Fees: Second Instance (Federal Supreme
Court) ......................................... 110
6.1.3 Costs for Court Expert ......................... 111
6.2 Security for Defendant's Costs of the Proceedings ........ 111
Chapter 8
Pre-Suit Considerations and Infringement Trial ................ 113
1 Jurisdiction and its International Aspects ................. 113
1.1 Venue ................................................. 113
1.2 Trans-Border Jurisdiction ............................. 115
1.3 "Torpedo" ............................................. 117
2 Contacting the Accused Infringer ........................... 118
2.1 Warning Letter (Abmahnung) ............................ 119
2.1.1 Content of Warning Letter ...................... 119
2.1.2 Unjustified Warning Letter ..................... 120
2.2 Inquiry Letter (Berechtigungsanfrage) ................. 120
3 Lawsuit on the Merits (First Instance) ..................... 121
3.1 Overall Timeline ...................................... 121
3.2 Contents of the Complaint ............................. 123
3.2.1 Rights and Requests ............................ 124
3.2.1.1 Right to Prevent the Use of the
Patent ................................ 124
3.2.1.2 Right to Claim Damages ................ 128
3.2.1.3 Right to be Informed and Rendering
of Accounts ........................... 129
3.2.1.4 Other Rights .......................... 130
3.2.2 Information about the Subject Matter of the
Case ........................................... 131
3.3 Defendant's Defense ................................... 133
3.3.1 Factual Submissions ............................ 134
3.3.2 Legal and Procedural Defenses .................. 134
3.3.3 Requests of the Defendant ...................... 138
3.4 Further Briefs until the Main Hearing ................. 138
3.5 Hearing ............................................... 139
3.6 Outcome of the First Instance Proceedings ............. 140
3.6.1 Grant of the Action or Complete/Partial
Dismissal (Decision on the Merits) ............. 140
3.6.2 Suspension of the Proceedings .................. 141
3.6.3 Further Evidence Taking: Appointment of
a Court Expert ................................. 145
4 Relief ..................................................... 147
4.1 Appeal of First Instance Decisions .................... 147
4.2 Appeal of Appellate Decisions: Federal Supreme
Court ................................................. 148
5 Enforcement Proceedings .................................... 149
5.1 Provision of Security ................................. 149
5.2 Motion for Temporary Suspension of Enforcement ........ 149
5.3 Compliance with Injunctive Relief ..................... 151
5.4 Rendering of Accounts and Lawsuit Concerning the
Amount of Damages ..................................... 151
5.5 Reimbursement of Costs ................................ 153
6 Particular Issues .......................................... 153
6.1 Declaratory Judgment Action ........................... 153
6.2 Special Defense resulting from Antitrust Law .......... 154
7 Financial Aspects of Infringement Proceedings .............. 156
7.1 Litigation Value ...................................... 156
7.2 Court Fees ............................................ 157
7.2.1 Court Fees for the First Instance .............. 157
7.2.2 Court Fees for the Second Instance ............. 158
7.2.3 Costs for the Third Instance ................... 158
7.3 Provision of a Security for Defendant's Legal Costs ... 158
7.3.1 Principle ...................................... 158
7.3.2 Amount of the Security ......................... 158
Chapter 9
Preliminary Injunction Proceedings ............................ 161
1 Introduction ............................................... 161
2 Proper Court ............................................... 161
3 Basis for a Preliminary Injunction ......................... 162
3.1 Claim on which the Injunction is Based
Verfügungsgrund .................................... 162
3.2 Particular Reasons for a Preliminary Injunction
Verfügungsgrund ....................................... 164
3.2.1 Urgency ........................................ 164
3.2.2 Other Interests Weighed ........................ 164
3.3 Particular Situation: Trade Shows ..................... 166
4 Normal Course of Preliminary Injunction Proceedings ........ 167
4.1 Ex Parte Proceedings .................................. 167
4.2 Inter Partes Proceedings .............................. 169
5 Possible Reactions of the Accused Infringer ................ 170
5.1 Protective Brief ...................................... 170
5.2 Acceptance and Final Warning Notice ................... 171
Chapter 10
Claim Construction and Infringement ........................... 173
1 Claim Construction Procedure ............................... 173
2 Claim Construction ......................................... 175
2.1 Aim of the Claim Construction ......................... 175
2.2 Significance of the Claims ............................ 176
2.2.1 Semantic Content (Sinngehalt) .................. 176
2.2.2 Main Sources for the Claim Construction ........ 177
2.2.2.1 Definitions in the Description ........ 178
2.2.2.2 Examples and Preferred Embodiments .... 178
2.2.2.3 Dependent Claims ...................... 179
2.2.2.4 Indications of Purpose ................ 179
2.2.2.5 Numerical Indications ................. 179
2.2.2.6 Reference to the Prior Art ............ 180
2.2.3 Evidence Outside of the Patent Document ........ 180
2.2.3.1 General Expertise of the Skilled
Person ................................ 180
2.2.3.2 Inadmissibility of Prosecution File
Estoppel .............................. 181
2.2.3.3 Effects of Invalidation Proceedings
on the Claim Construction ............. 181
3 Identical And Equivalent Infringement ...................... 182
3.1 Identical Infringement ................................ 182
3.2 Doctrine of Equivalents ............................... 183
4 Infringing Acts ............................................ 185
4.1 Direct infringement ................................... 185
4.1.1 Products ....................................... 186
4.1.2 Processes ...................................... 188
4.1.3 Product-by-Process Claims ...................... 189
4.2 Contributory infringement ............................. 190
5 Exhaustion ................................................. 192
5.1 Putting onto the EU/EEA Market ........................ 192
5.2 Assertion of a Patent with Device Claim ............... 193
5.3 Assertion of a Patent with a Method Claim ............. 193
5.4 Assertion of a Patent Containing Apparatus and
Method Claims ......................................... 194
5.5 Limits to the Concept of Exhaustion of Rights
(Maintenance versus Rebuilding) ....................... 194
Chapter 11
Discovery and Evidence Taking ................................. 197
1 General Framework .......................................... 197
1.1 Introduction .......................................... 197
1.2 Burden of Proof and Duty of Presentation .............. 198
2 Historical Development ..................................... 199
3 Discovery Before Filing a Complaint ........................ 200
3.1 Requirements .......................................... 200
3.1.1 "Sufficient Probability" of Patent
Infringement ................................... 200
3.1.2 Necessity and Principle of Proportionality ..... 200
3.2 Procedural Implementation of the Request .............. 201
3.2.1 General Outline ................................ 201
3.2.2 Protection of the Defendant's Secrecy
Interests ...................................... 201
3.2.3 Scope and Aim of the Request ................... 203
4 Discovery After Filing the Complaint ....................... 204
4.1 Discovery according to §140c Patent Act ............... 204
4.2 Procedural Means (§§142,144 Code of Civil
Procedure) ............................................ 204
4.3 Reports of Court-Appointed Experts .................... 206
4.4 Witnesses ............................................. 207
5 Privileges and Data Protection ............................. 207
5.1 Attorney-Client-Privileges ............................ 207
5.2 U.S. Disclosure Requests Implemented in Germany ....... 208
5.2.1 The Hague Convention on Evidence Taking ........ 208
5.2.2 Voluntary Depositions in Germany ............... 210
5.2.3 German Data Protection in the Light of US
Discovery ...................................... 210
5.2.4 Protection of Communications with German
Representatives ................................ 212
Chapter 12
Damages ....................................................... 213
1 General Remarks ............................................ 213
2 Reasonable Royalty ......................................... 214
2.1 Royalty Base (Bezugsgröße) ............................ 214
2.2 Royalty Rate .......................................... 215
3 Lost Profits of the Right Holder ........................... 216
4 Profits Made by the Infringer .............................. 217
4.1 Infringer's Revenue ................................... 218
4.2 Deductible Costs ...................................... 218
4.3 Share Factor (Anteilsfaktor) .......................... 219
5 Period for Which Damages are to be Paid .................... 220
5.1 Starting Point ........................................ 220
5.1.1 General ........................................ 220
5.1.2 Published Patent Applications .................. 221
5.1.2.1 Requirements .......................... 222
5.1.2.2 "Compensation appropriate to the
circumstance" ......................... 223
5.2 End of the Damages Calculation Period ................. 223
Chapter 13
Inventorship and Ownership .................................... 227
1 Inventorship ............................................... 227
2 Assignment of the Right to the Invention ................... 228
3 Co-Ownership of the Invention .............................. 229
4 Correct Entitlement to the Invention ....................... 230
4.1 Legal Fiction in Favor of the Applicant ............... 230
4.2 Legal Function of the Register ........................ 231
5 Employee Inventions and the Act on Employees' Inventions
(ARBEG) .................................................... 231
5.1 Scope of Application of the ArbEG ..................... 232
5.1.1 Material Scope of Application .................. 232
5.1.2 Personal Scope of Application .................. 232
5.1.3 Territorial Application ........................ 233
5.2 Service Inventions and Free Inventions ................ 233
5.3 Duty to Report ........................................ 235
5.4 Acquisition of the Ownership of Service Inventions .... 236
5.5 Obligations of Employer after Acquisition of the
Service Invention ..................................... 238
5.5.1 Protection of the Service Invention ............ 238
5.5.2 Agreements between Employer and Employee ....... 240
5.6 Employee's compensation ............................... 240
5.6.1 Individual Agreements on the Compensation ...... 240
5.6.2 Calculation Methods ............................ 241
5.6.2.1 Contribution factor (Directive,
N30) .................................. 242
5.6.2.2 License Analogy ....................... 242
5.6.2.3 Other Two Methods: Benefit to the
Employer Or the Invention's Value ..... 243
5.7 Resolution of Disputes ................................ 244
Chapter 14
Customs Actions ............................................... 245
1 Introduction ............................................... 245
2 Legal Framework ............................................ 247
2.1 EU Rules .............................................. 247
2.2 National Rules ........................................ 248
3 Application Proceedings .................................... 249
3.1 Content of the Application ............................ 250
3.2 Security .............................................. 251
4 Grant of the Application ................................... 252
5 Ongoing Updates to Customs ................................. 252
6 Detention Procedure ........................................ 253
6.1 Customs' Detection and Assessment of Goods ............ 253
6.2 Notification of Detention ............................. 254
6.3 Measures after Notification of the Parties ............ 255
6.3.1 EU Rules ....................................... 255
6.3.1.1 Simplified Destruction Procedure ...... 255
6.3.1.2 Regular Proceedings (Article 13 EC
Regulation) ........................... 256
6.3.1.3 Possibility of Release of Detained
Goods (Article 14 EC Regulation) ...... 256
6.3.2 German Rules (§142a of the German Patent
Act) ........................................... 257
7 Possible Liabilities ....................................... 258
8 Costs of the Proceedings ................................... 258
Chapter 15
Budgeting a Patent Enforcement Case ........................... 259
1 Financial Aspects of German Patent Litigation .............. 259
2 Infringement Proceedings ................................... 260
2.1 Costs of the Party's own Legal Representative ......... 260
2.1.1 Billing on an Hourly Basis ..................... 260
2.1.2 Billing According to the Statutory Fee Act
(First Instance) ............................... 261
2.1.3 Billing According to the Statutory Fee Act
(2nd Instance) ................................. 261
2.1.4 Costs for the 3rd Instance ..................... 262
2.2 Cost Increasing Factors ............................... 262
3 Costs for Nullity Proceedings .............................. 262
3.1 Average Costs for Legal Representatives ............... 262
3.2 Cost Increasing Factors ............................... 263
3.3 Opposition Proceedings before EPO ..................... 263
4 Reimbursement .............................................. 264
4.1 Proceedings before the Infringement Courts ............ 264
4.2 Invalidation Proceedings .............................. 264
4.2.1 EPO Opposition ................................. 264
4.2.2 German Invalidation Proceedings (1st and 2nd
Instance) ...................................... 264
5 Risk Assessment: Infringement Plus Invalidation
Proceedings ................................................ 264
Chapter 16
Samples ....................................................... 267
1 Warning Letter ............................................. 267
1.1 Body of the Warning Letter ............................ 268
1.2 Undertaking of Cease and Desist ....................... 271
2 Inquiry Letter ............................................. 273
3 Complaint Brief (Infringement Action) ...................... 275
4 Settlement Agreement ....................................... 281
5 Request for a Preliminary Injunction ....................... 284
6 Protective Brief ........................................... 289
7 Bank Guarantee ............................................. 292
Chapter 17
Legal Texts ................................................... 293
1 Excerpts of the EPC ........................................ 293
2 Chapter V - Biotechnological Inventions .................... 306
3 Excerpts of the German Patent Act .......................... 308
4 Utility Model Act .......................................... 329
5 Act on Employee's Inventions ............................... 342
6 Council Regulation (EC) No 1383/2003 of 22 July 2003
Concerning Customs Action Against Goods Suspected of
Infringing Certain Intellectual Property Rights and the
Measures to be Taken Against Goods Found to have
Infringed Such Rights ...................................... 348
Chapter 18
Key Differences between U.S. and European Patent Laws ......... 361
1 First-to-File Versus First-to-invent ....................... 361
2 Grace Period ............................................... 361
3 Confidential Sales as Prior Art (The "On-Sale Bar") ........ 362
4 Best Mode Requirement ...................................... 362
5 Patent Term ................................................ 362
6 Duty to Disclose ........................................... 363
7 Inequitable Conduct Defenses ............................... 363
8 Prosecution File Estoppel .................................. 363
9 Reissue Versus Limitation Proceedings ...................... 363
10 Opposition Versus Reexamination ............................ 364
11 Jury Trial Versus Bench Trial .............................. 364
12 Infringement and Validity Proceedings ...................... 364
13 Discovery .................................................. 364
14 Enhanced/Multiple Damages .................................. 365
15 Patent Marking ............................................. 365
16 Injunctions ................................................ 365
Index ......................................................... 367
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