global patent litigation: trends, tools, and strategies to
TRANSCRIPT
Global Patent Litigation: Trends, Tools, and
Strategies to Enforce Your Patent Rights GloballyData Metrics, Win Rates, and Other Key Considerations for Parties Pursuing a Global Approach
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TUESDAY, JUNE 2, 2020
Presenting a live 90-minute webinar with interactive Q&A
Michael Crichton, Partner, Gowling WLG, Ottawa
C. Gregory Gramenopoulos, Partner, Finnegan Henderson Farabow Garrett & Dunner, Washington, D.C.
Vincenzo Jandoli, Partner, Avvocati Associati Franzosi Dal Negro Setti, Milan, Italy
Roland Küppers, LL.M., Partner, Taylor Wessing, Düsseldorf
Chris Thornham, Partner, Taylor Wessing, London
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Disclaimer
These materials have been prepared solely for educational and informational purposes to
contribute to the understanding of U.S. and international intellectual property law. These
materials reflect only the personal views of the authors and are not individualized legal
advice. It is understood that each case is fact specific, and that the appropriate solution in
any case will vary. Therefore, these materials may or may not be relevant to any particular
situation. Thus, the authors and Finnegan, Henderson, Farabow, Garrett & Dunner, LLP
(including Finnegan Europe LLP, and Fei Han Foreign Legal Affairs Law Firm), Gowling WLG,
Avvocati Associati Franzosi Deal Negro Setti, and Taylor Wessing, cannot be bound either
philosophically or as representatives of their various present and future clients to the
comments expressed in these materials. The presentation of these materials does not
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5
AgendaI. Introduction: The Global Litigation Landscape
A. What are the top countries for litigating patent disputes?B. What trends can be observed in global patent litigation?C. Case examples
II. Comparison of Top Jurisdictions for Litigating PatentsA. Legal frameworks and courts of first instance for patent disputesB. Objective litigation metrics including win rates, time to trial, and costsC. Available remedies, including damages and injunctionsD. Procedural and substantive differences between jurisdictions
III. Tools and Planning StepsA. Four tools for effective planningB. Addressing key questions for each jurisdictionC. Forum selection and timelines
IV. Strategies to Develop a Winning Global Patent Litigation PlanA. Inter and intra country strategiesB. Special considerations and planning for individual jurisdictionsC. Leveraging procedural and substantive differences between jurisdictions
6
▪ Founded in January 2002
Michael C. Elmer, Finnegan, Henderson
▪ Members: Top Patent litigators from +30 countries
Argentina, Austria, Australia, Belgium, Brazil, Canada, Chile,
China, Denmark, England, Finland, France, Germany, Greece,
India, Ireland, Israel, Italy, Japan, Korea, Mexico, Netherlands,
New Zealand, Norway, Russia, Scotland, Spain, South Africa,
Sweden, Switzerland, Taiwan, Turkey, and United States
7
• Win rates, time-to-trial, and other global patent litigation data were not readily available
• Companies could not make informed decisions about how, when, and where to litigate
• Substantive and procedural differences in legal systems were not fully appreciated
• More transparency was needed to develop effective global litigation strategies
8
Why Was the Global IP Project Started?
Activities• Data collaboration agreement with Darts IP (www.darts-ip.com)
• Treatise: Global Patent Litigation: How and Where to Win
― Co-authored by Global IP Project members
― Published by Bloomberg Law
― Third Edition – Published in April 2019
• Website (www.globalpatentmetrics.com)
9
Most Active Countries for Patent Litigation
Average Annual Filings (2006-2016)
China, 8400, inf onlyU.S. 4280
Germany, 1200
France, 350
India, 200
Japan, 150
Taiwan, 140
England, 140-150
Italy, 120
Canada, 72
10
Trends in Global Patent Litigation
Global trend toward specialized patent courts
• China, Switzerland, Russia, etc.
Litigation in U.S. v. Rest of the World (RoW)
• U.S.: Damages are usually important; injunctions are not readily
available (eBay v. MercExchange); broad discovery and right to jury
trial; attorney fees not automatic
• RoW: Injunctions are usually more important (automatic to winning
party); damages are a lower priority; limited or no discovery; no jury
trial; “loser pays” more prevalent
11
Trends in Global Patent Litigation
NPEs Now Going Global
12
65 68 6375
90
146
119
169 173
0
20
40
60
80
100
120
140
160
180
200
2009 2010 2011 2012 2013 2014 2015 2016 2017
Number of actions concerning NPE related litigation (EU)
Non-Practicing Entities litigating in the EU (2009 – 2017)
Trends in Global Patent Litigation
NPEs Now Going Global
• In Europe, NPEs favor Germany the most, followed by the UK, the
Netherlands, France, and Italy
13
Source: Darts-ip, NPE Litigation in the European Union (2018)
4%
France
19.5%
Germany
5.5%
The Netherlands
4.2%
United Kingdom
6%
Italy
96% 80.5% 94.5% 95.8%94%
Trends in Global Patent Litigation
14
Source: Darts-ip, NPE Litigation in the European Union (2018)
Case Examples: Global Patent Litigation
Unwired Planet v. Huawei
• Cases filed in the UK and DE; asserted patents (acquired from
Ericsson) claimed to be essential (SEPs) to wireless standards (2G,
3G, and 4G).
• Google and Samsung settled earlier; settlement recently reached
with Huawei (2020).
Philips v. Asus
• Asserted wireless patents include SEPs and implementation patents.
• Ongoing litigation in DE (more than one dozen patents); earlier cases
in the UK and NL.
15
Comparison of Top Jurisdictions
for Litigating Patents
16
Legal Frameworks
Around the World
LegalSystem
Common Law
Civil Law
Litigation
Unified
Bifurcated
Australia,
Canada,
England,
India,
Israel, NZ,
S. Africa,
U.S.
Brazil, China, France,
Germany, Greece, Italy,
Japan, NL, Russia, S.
Korea, Spain, Switzerland,
Taiwan
Australia, Canada, England, France,
Greece, India, Israel, Italy,
Japan, NL, NZ, S. Africa,
Spain, Taiwan, U.S.
Brazil, China,
Germany,
Russia, S.
Korea
17
CountryCommon v.
Civil Law Unified v. Bifurcated
Number of trials for validity/infring/
damages
Canada Common Unified Usually 2
China Civil Bifurcated 2
England
and WalesCommon Unified 2
France Civil Unified 1
Germany Civil Bifurcated 3
Italy Civil Unified 1
US Common Unified 1
Legal Frameworks
Around the World
18
CountryNumber of First-Instance
Infringement CourtsBusiest Infringement
CourtBusiest Invalidation Forum (Bifurcated)
Canada 1Federal Court
Toronto/OttawaN/A
China 78 + 4 + 31 + 3 (IP Courts)Invention: Beijing 1st
Utility Model: Guangdong Guangzhou
State Intellectual Property Office (SIPO)
England
and Wales1 + 1 (IPEC)
Patents CourtLondon
N/A
France 1High Court
ParisN/A
Germany 12 Düsseldorf Federal Patent Court
Italy 22Corporate Court
MilanN/A
US 94 +2 (Fed. Claims, ITC)District Court of
DelawareN/A (PTAB)
Number and Location of First-Instance
Patent Infringement Litigation Courts
19
20
Legal Framework in Germany – Bifurcation
Appeal
Federal Court of Justice
Infringement action
District Court
Judgment Possible stay
Court of Appeal
Appeal on points of law
Nullity action
Judgment
Appeal
Federal Patent CourtDefendant files Nullity action
Patent revoked Patent limited Patent upheld
21
Courts of First Instance in Germany
Berlin
Hamburg
Braunschweig
Leipzig
Erfurt
Dusseldorf
64.5% patentee win rate
(inf)
Frankfurt
Mannheim
60% patentee win rate
(inf)Saarbrücken
Nuremberg
Munich
62% patentee win rate
(inf)
▪ 12 specialized courts for
patent infringement
disputes (Forum Shopping)
▪ 900 patent-related civil
actions filed in Germany
per year:
˃ Dusseldorf 450
˃ Mannheim 200
˃ Munich 150
˃ Others 100
▪ Federal Patent Court rules
on nullity actions
▪ 250 nullity actions filed
annually
▪ 50% patentee win rate
(Global IP methodology: win
= maintained + ½ partially
nullified)
▪
22
Legal Framework in Germany
Special feature:
Bifurcated system Nullity and infringement
proceedings are separate
Infringement case can be
stayed pending the outcome
of the parallel invalidity attack
Benefits:
Short infringement
proceedings
Reducing procedural costs
Disadvantage:
Injunction gap Infringement decision can be
(preliminarily) enforced before
the parallel invalidity attack is
decided
Requirements for a stay of the
infringement proceedings are
high
Burden of proof on the
infringer
Legal Framework in Germany - Injunction Gap
0 2 4 6 8 10 12 14 16 18 20 22 24 26 28 30 32 34
Nullity procedure
Infringement procedure
Infringement action
Duration in months
Hearing
Statement of
defence
Preliminary opinion
Hearing
Judgment
Nullity
action
Injunction gap
23
Canadian Court System• Federal Court
o Exclusive jurisdiction to hear impeachment
actions (declaring a patent or any claim to be
invalid or void).
o National court with jurisdiction across Canada
(no forum-shopping)
o Two main types of patent litigation cases: o Infringement actions with counterclaim for
invalidity
o Includes new PM(NOC) proceedings
(discussed below)
o Impeachment proceedings
• Provincial Superior Courts
• Note: Given federal jurisdiction and IP expertise, vast majority of actions are brought in the Federal Court.
Legal Framework in Canada
Handles vast majority of
patent cases as a partially-
specialized IP Court
Approximately 45 Judges
total
Approximately 10 Judges
focused on IP
24
Patent Infringement
• Non-bifurcated system (validity and infringement are tried together)
• 6-year limitation period (Patent Act s. 55.01): plaintiff can only claim a
remedy with respect to an act of infringement occurring within 6 years of
commencement of the action
• Federal Court of Canada and any provincial superior court are proper
venues (Patent Act s. 54; Federal Courts Act s. 20)
• Given federal jurisdiction and IP expertise, vast majority of actions are brought in
the Federal Court
Patent Impeachment
• Federal Court (Patent Act s. 60): any “interested person” can initiate an
impeachment action for declaratory judgment of invalidity and/or non-
infringement
Patent Infringement
Actions in Canada
25
New PMNOC REGULATIONS in Canada• Patented Medicines (Notice of
Compliance) Regulations (PMNOC
Regulations) overhauled in September
2017
• Objectives of New Regulations • Applications replaced with actions
• Elimination of dual litigation
• Right of appeal for innovators
• Relief sought• Declaration for infringement /
Counterclaim for invalidity
• Broadened scope of enforceable claims
• Quia timet actions for unlisted patents
• Commencement of Proceedings• 45-day deadline to commence action
• Mandatory document production for
generic
• Mandatory document production for
innovator
Pharmaceutical Patents
26
Global Patent
Litigation Metrics
27
Global Patent Litigation: Annual Filings
and Win Rates (2006-2016)
28
Note: Patent owner “win” is on a per case basis and an infringement case that went to a first-
instance trial decision on the merits and at least one claim was held valid and infringed.
Country Annual Patent
Litigation
Filings (avg.)
Patentee win rate on first-instance decisions
on the merits
China 8400 (inf., 2011-
2016)
Infringement:
• Invention patents: 13% (1/8) (2012–2016)
• Utility models: 50% (1/2) (2012–2016)
Validity:
• Invention patents: 33% (2012–2016)
• Utility models: 100% (2/2) (2012–2016)
U.S. 4280 Overall: 55.5%; Contested: 22.3%; Trial: 61.6%; Jury verdict: 65.7%;
Bench trial: 53.7%
Germany 1200 Infringement: 64% (699/1061) (2006–2016)
Nullity actions in Federal Patent Court: 50% (2006–2016)
Combined win rate (only if same patent): 32%
France 350 33%
India 200 100% (2/2)
Patent Litigation: Most Active Countries By
Annual Filings (2006-2016)
29
Country Annual Patent Litigation
Filings
Patentee win rate on first-instance decisions
on the merits
Japan 150 Invention patents: 24% (127/522)
Utility models: 14% (3/21)
Taiwan 140 (2008-2016) Invention patents: 14% (43/311)
Utility models: 21% (91/426)
Design patents: 35% (28/79)
(2008-16)
England and
Wales
140-150 40% (59/147)
Italy 120 43% (150/352)
Canada 72 52% (32/61)
Note: Patent owner “win” is on a per case basis and an infringement case that went to a first-
instance trial decision on the merits and at least one claim was held valid and infringed.
Avv. Vincenzo JandoliFRANZOSI DAL NEGRO SETTI
E-mail: [email protected]
Milan Turin Venice Rome
67.6560
50
33.33
W L
Win Rates Can Vary
Among First-Instance Courts:
Italy (2018-2019)
Milan Turin Venice Rome
35 4030.76
40.9
W L
Urgent proceeding Full scale litigation
30
31
Time to Trial and Costs
Country
Average time (months)
from filing to first-instance
decision on the merits
Average cost of first-instance
proceeding (USD $)
England 17.2 $1.35 M
Germany 12 (infringement); 25 (validity)
$100,000–$500,000 infringement
action and defending parallel
nullity action
Canada 30 $500,000–$1.5 M
China 8.7 (infringement); 6 (validity) $50,000–$200,000
Italy 42 $100,000-$200,000
US 30 $4 M
Avv. Vincenzo JandoliFRANZOSI DAL NEGRO SETTI
E-mail: [email protected]
Avv. Vincenzo JandoliFRANZOSI DAL NEGRO SETTI
E-mail: [email protected]
3633
30
47
54
0
10
20
30
40
50
60
Milan Turin Venice Bologna Rome
Time to Trial Can May
Among First-Instance Courts:
Italy (Damages Incl.) (2018-2019)
32
Number of Proceedings Commenced in
Canada
53
6864
49
57
72
54 5650
47
101
43
52
70
50
63
5053
57
6760
83
6763
48
79
68
53
26
34
4437
103
121 121116 117
155
121 119
98
126
169
96
78
104
94100
2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018
Patent Infringement
PMNOC Regulations
Cumulative
33
Patentee Win Rate 2006-2017:
First-Instance in Canada
1
2
1
1 1
6
1
5 4
23
1
3
1
1
4 4
1
3
3 3
54
2
2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017
NU
MB
ER O
F C
ASE
S W
ON
Patent Owner Alleged Infringer
Average Win Rate for Patentees: 43%
34
PE vs. PAE vs. NPE
in Canada
0
20
40
60
80
100
120
2010 2011 2012 2013 2014 2015 2016 2017 2018
PE vs. PAE vs. NPE Cases (Total Number)
Competitor PAE NPE
0%
20%
40%
60%
80%
100%
2010 2011 2012 2013 2014 2015 2016 2017 2018
PE vs. PAE vs. NPE Cases (%)
Competitor PAE NPE
35
Pharmaceuticals: Patentee Outcomes in
PMNOC Decisions in Canada
36
37
Number of Infringement Proceedings
Commenced in Germany
― Patent-related civil actions started in Germany*
― Selected courts
571
665
491 489460 460
498
422488
425
328
250283 306
215175168 158 174 186 163
108
181144
0
100
200
300
400
500
600
700
2009 2010 2011 2012 2013 2014 2015 2016*** 2017** 2018** 2019
DC Düsseldorf DC Mannheim DC Munich
* Data may include cases concerning utility models, employee’s inventions and/or plant variety rights** Source: JUVE News *** Source: Estimate based on JUVE News
38
Patentee Win Rate (2006-2017):
First-Instance Infringement in Germany
― Average win rate for patentees: 64% (855/1364)
Patent Nullity Actions
Commenced in Germany
― Nullity proceedings started and terminated before the Federal Patent Court*
228255
297
261
226 221 217
284
244219227
242
276258 262 261
242
206 206
244
0
50
100
150
200
250
300
350
2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019
New Proceedings Action proc. Terminated
* Source: Annual reports of the Federal Patent Court
39
― 1st instance patent nullity actions (2006-2016; 1.486 actions filed)
― Success rate for patentee: 50%* (519 of 1.027 decisions)
Patentee Win Rate (2006-2016):
First-Instance Patent Nullity Actions
418
179
430
At least oneclaim amended= partially nullified
Nullified
Maintained
*Global IP methodology: win = maintained + ½ win (partially nullified)
40
Remedies
41
Type of Damages Available
Country Reasonableroyalty
Lostprofits
Infringer’sprofits
Statute oflimitations(years)
Largest everdamages award(USD $)
Canada Yes Yes Yes 6 $515.3 M
China Yes Yes Yes 2 $44 M
England and Wales
Yes Yes Yes 6 $6.15 M
France Yes Yes No 3 $12.3 M
Germany Yes Yes Yes 3 $2.7 M
Italy Yes Yes Yes 5 $7 M
U.S. Yes Yes No 6 $2.54 B
42
Preliminary Injunction Win Rates
29%2/7
58%7/12
69%24/35
41%34/83
31%332/1070
0%
10%
20%
30%
40%
50%
60%
70%
80%
Canada England Germany Italy U.S.
Source: England: DARTS-IP; France: DARTS-IP (2006–2016); Germany: Global IP Project; Italy: DARTS-IP (2006–2016); United States: LegalMetric Nationwide Report, Preliminary Injunctions in Patent Cases Jan. 2000–Dec.2017. Of 1,070 preliminary injunction decisions, 296 were granted and 36 were granted-in-part.
43-
Remedies in Germany – Overview
― Injunction (permanent)
― Removal/recall from trade channels
― Destruction
― Information on sales, suppliers and customers
― Rendering of accounts
― Damages
― Cost reimbursement:− Attorneys‘ and patent attorneys‘ fees
• Winning party is entitled to reimbursement
• Reimbursement limited by statutory fees calculated on the basis of the value-in-litigation
− Court fees
− Necessary costs for proceedings, e.g. translation costs, travel expenses, etc.
44
▪ Required: Exceptional circumstances render economic consequences of the injunction unreasonable, i.e.
− patent concerns an essential functional component of a complex product
− no or at least no reasonable possibility of licensing
− aspects of good faith (e.g. finding of non-infringement by lower courts).
▪ In the specific case, the FCJ did not award an exceptional grace period.
▪ Arguments: “airscarf” not functionally essential component, but rather special equipment; car remains
usable without it; lack of licensing possibility not substantiated by defendant.
Remedies in Germany –
Proportionality of Injunction?• Federal Court of Justice, judgment of 10 May 2016, case
no. X ZR 114/13, Wärmetauscher („Heat exchanger“)
• Car manufacturer was sued for infringement of patented,
seat-integrated fan for convertibles (Daimler’s “airscarf”).
• FCJ stipulated requirements for exceptional grace period
for distributing already existing infringing products due to
disproportionality of immediate injunctive relief
45
Practically only relevant for damages, rendering of accounts:
− Objection to be raised by defendant, not taken into consideration by the court ex officio
− 3 years from the end of the year in which the patentee had/should have reasonably had
knowledge of the infringing act(s) in Germany
− Claims for unjust enrichment (Restschadensersatzanspruch) still available if more than 3
years have passed
• within 10 years since (known) infringing act and damages were incurred or
• within 30 years from the date of (unknown) infringing act and damages incurred more than 10 years before.
− Calculation methods of the infringer’s profits and reasonable royalty are available
• FCJ, judgment of 26 March 2019, case no. X ZR 109/16 – Spannungsversorgungsvorrichtung (“Power Supply
Device”)
Remedies in Germany –
Statute of Limitations
46
▪ Summary proceedings
▪ Requirements:
− Clear-cut infringement
− No reasonable doubts about patent‘s validity
― First instance inter partes proceedings on validity
― or prior successful patent enforcement
― or expiry of patent is imminent
− Urgency, usually within 1-2 months (varying by court)
― after obtaining knowledge of infringement/infringer
― after confirmation of patent‘s validity
− Preliminary relief required to avoid considerable damages (balance of
interests)
― Usually inter partes proceedings in patent cases
― Standard of proof: prima facie evidence
Remedies in Germany –
Preliminary Injunction Proceedings
47
Successful plaintiff’s remedies:• Damages or an accounting of profits for post-grant infringement
• Plaintiff may elect one or the other, but profits are only available where plaintiff demonstrates that it would be equitable to grant such a remedy
• Reasonable compensation (reasonable royalty) for pre-grant (laid open period) infringement
• Permanent injunction• Subject to equitable considerations
• Delivery up or destruction
Usually (but not always), the Court will award costs to the successful party (plaintiff or defendant)
• Typically, costs awards represent 20-40% of a party’s actual attorney fees, and 100% of all reasonable disbursements
Remedies in Canada
48
How and When Damages Accrue in Canada
49
Procedural Differences Between
Germany and Canada
50
Document Discovery• Affidavits of documents list all documents (or bundles of documents) that are relevant and
non-privileged
• Onus on each party to prepare one’s own affidavit – scope is relatively broad
• Obligation to update the affidavit of documents with new relevant documents
• Protective and confidentiality orders routinely granted
Oral Discovery• One representative per party examined orally (akin to 30(b)(6) witness in the US)
• Undertakings given where the representative does not know answer, or where further relevant documents should be produced
• Refusals motions and follow up examinations are common
• Discovery evidence may be read in at trial
• Matters refused on discovery cannot be presented at trial by the refusing party
• Ongoing obligation to correct answers
• No other discovery examinations, except inventor examinations permitted
Discovery in Canada
51
Expert witnesses• Experts are almost always used in patent litigation, though ultimately
claim construction is a legal issue
• Experts are regularly called upon to provide opinion evidence regarding the technology at issue in the case, and the quantification of monetary remedies
• Parties are limited to a total of five experts each
Expert reports• Claim construction and infringement/validity (multiple rounds of
reports)
• There are no pre-trial examinations (depositions) of experts; experts are only examined at trial
Experts in Canada
52
Trial before a single judge (no jury)• Opening statements
• Plaintiff’s evidence (reading in discovery admissions; fact and expert witnesses)
• Defendant’s evidence (reading in discovery admissions; fact and expert witnesses)
• Plaintiff’s reply evidence (fact and expert witnesses)
• Closing arguments of all parties
• Typical duration: 10-20 court days
Trial judge’s decision• Typically published within a few months of the end of trial, sometimes longer
• All issues addressed in written decision
• Thirty (30) days to appeal to Court of Appeal
Trial in Canada
53
▪ Permissible evidence in proceedings on the merits:
− Expert opinion
− Documents
− Visual inspection by the court
− Witness testimony
− Hearing of the party
▪ Standard of proof for preliminary injunctions:
− prima facie evidence (e.g. affidavit)
Evidence in Germany
54
▪ Types of experts
− Expert witness
− Court-appointed expert
▪ Expert witness/“Private expert opinion“
− Offered by one of the parties in support of own argument
− Written opinion has same evidentiary value as party‘s own statement
− Expert witness can be – but is practically rarely – examined by court
• (supplementary questions by the parties, no cross-examination)
▪ Court-appointed expert
− Neutral
− Delivers written opinion
− Examination by court during trial
• (supplementary questions by the parties, no cross-examination)
Experts in Germany
55
▪ Main arguments exchanged in writing
▪ Front-loaded proceedings
▪ Short trial
− One main hearing date (preparatory hearing as exception)
− Separate hearing if evidence procedure is necessary
▪ Court usually provides preliminary assessment at the beginning of the hearing
▪ Pleadings focused on specific issues
▪ Date for rendering court decision given at end of the hearing
− Exception: Decision at the end of the hearing („Stuhlurteil“)
Trial in Germany
56
Tools and
Planning Steps
57
Global Case Scenario
• Client
Manufacturer based in US, with sales in the US, Canada and Europe
Granted patents in the US, Canada, Europe (Germany, UK, Italy ,etc.) and China
• Competitor
Manufacturer based in China.
Starting to sell in the US, Canada and Europe.
• Questions for the client:
1) Attempt to negotiate global licenses?
2) Pursue infringement action in US?
3) Pursue infringement action in Canada?
4) Pursue infringement action(s) in Europe, but in which countries?
5) Pursue infringement action in China?
6) Wait for declaratory actions by competitor in some countries?
Best strategy?
58
59
A. Four tools for effective planning
B. Addressing key questions for each jurisdiction
C. Forum selection and timelines
D. Early case valuation methodology
Overiew: Tools and Planning Steps
Four Tools
Tool 1: Early Case Assessment
Afford to litigate?
Tool 2: Objective Data
What are chances of success?
Tool 3: Litigation Timeline and
Cost
How much? How long?
Tool 4: Case Valuation
Methodology
What will I get?
60
Typical early case assessment questions for a
company pre-suit:
1. Can you afford patent litigation?
2. Are you using/licensing the technology of your patent?
3. Does infringement cause significant damage to you/licensees?
4. Where might a case have most impact against your opponent?
5. Are you aware of any action an infringer could initiate?
6. Do you have a specific patent policy? Is it important that
competitors see you will pursue infringement?
Tool 1: Early Case Assessment
61
Tool 2: Objective Data Metrics
62
Tool 3: Time and Cost of Litigation
63
30 months$4 million
Tool 4: Expected Value Calculation
64
• WRc Combined Win Rate (Validity and Infringement)
A Expected Value of Past Damages
B Expected Value of Future Remedy
C Expected Value of Reimbursed Litigation Costs
• WRv Validity Win Rate
D Expected Value of Lost Licensing Revenues
E Expected Value of Reimbursing Opposing Party Costs
F Costs of Going to Trial
Addressing Key Questions for a Jurisdiction
(England and Wales)
26
26
ENGLAND: TIME AND COST
Infringement and invalidity per party per month (average case)
11 MONTHS
$1M6 MONTHS
Actual average time from filing to decision in 2010: 15 months.
Source: TaylorWessing
65
As a case progresses: • There are peaks and troughs of activity/costs• Parties refine their case assessments• There are windows for settlement
Forum Selection and Timelines
For each jurisdiction consider the four questions:1. Chances2. Time3. Cost 4. Value (EV2 formula or other)
In Europe:
• Germany is common "first strike" location to sue for infringement
• The UK is a common location to challenge validity
• Italy may be a good forum due to market size or location of litigants
66
Early Case Valuation Methodology
1. Early case assessment
2. Consideration of evidence to support the case/improve chances― pre-action procedures― inspection / samples― disclosure (discovery) of documents during proceedings― deposition of witnesses― material from other court proceedings― experts: appointed by parties or the court?
3. Timing considerations that may favour a jurisdiction
4. Case value in each jurisdiction (EV2 or other calculation)
67
Strategies to Develop a
Winning Global Litigation Plan
68
Developing a Winning Global
LitigationStrategy
69
▪ “Global Case Scenario”– Products sold or offered in more than one country
– Patents exists that provide opportunity to litigate in more than one country
– Forum shopping (inter and/or intra-country)
▪ Preliminary Analysis– Strengths and weaknesses of patent
– Scope of potential damages and/or injunction
– Identify experts, interview witnesses, review key documents/evidence
– Confirm legal status (ownership) and/or relationships
– Determine “business value” and objectives
Developing a Winning Global
LitigationStrategy
70
Global Patent Questions
• Identify key patent(s)
• Identify relevant countries and markets
• Evaluate business objectives (speed, costs, remedies, etc.)
Global Injunction Evaluation
• Where are injunctions available?
• Principal countries in order of market priorities
• Identify and select preferred courts
Global Damages Evaluation
• Case valuation (EV2formula or other)
• Review case valuation versus other key questions for each country
• Verify strategy against objectives
Developing an Effective Global StrategyHow long it will take?
12–18 months 36-48 months(varies by district)
10-14 months (varies by district)
16–36 months (varies by district)
How much will it cost?
U.S. $1.35 million U.S. $100,000 U.S. $100,000 medium-valuelitigationU.S. $500,000 high-value litigation
U.S. $4 million
What are my chances of success (patentee v. accused infringer)?
40% (2006-2016) 42% (2006–2016) Dusseldorf 64.5% (inf.)Munich 62%(inf.)Federal Patent Court 50% (nullity)
Overall 55.5%/Contested 22.3% (varies by district)
Available remedies to a patentee?
Profits on lost sales + reasonableroyalty on other infringing sales
Lost profits, reasonable royalty, and in any event infringer’s profits
Reasonable royalty, lost profits, infringer’s profits
Lost profits, reasonable royalty,punitive damages
Developing a Winning Global Strategy
71
Developing an Effective Global StrategyLegal System Common law
UnifiedCivil lawUnified
Civil lawBifurcated
Common lawUnified
Number of first instance patent litigation trial courts (federal district courts)
2 (Patents Court and IPEC) 22 12 infringement,1 validity
94 (+ US International Trade Commission and Court of Federal Claims)
Number of trials required validity/ infring/damages
2 (validity/infringement trial + separate damages hearing
1 3 1
Judge or panel Judge Panel: 1 judge hears case; 3-judge panel
decides
Panel Judge/Jury
Specialized intellectual property (IP) court/judges
Yes Yes/No Yes/No (some de facto) No/No
Loser pays winner’s costs (fees and disbursements)?
Yes Yes Yes No
Annual patent infringement litigation filings
140–150 ~120 ~900 infringementactions
~4300
Percentage of cases to trial
14% 33% >50% 3–4%
Developing a Winning Global Strategy
72
Forum-Shopping in Europe
Based Upon 5 Objective Factors
Best European court of first instance in which to initiate patent litigation as patentee:
Germany (good chance of winning infringement and, if win, costs paid by other side)
Best European court of first instance in which to initiate patent litigation as alleged infringer:
England (expensive, but good chance of winning and invalidated opponent’s patent)
1. High patentee win rateGermany/infringement
Netherlands
2. Fastest time to trialNetherlands, England ,
Germany
3. Low Cost(Germany, if win;
Netherlands)
4. Unlikely case will be stayed for validity
challenge(England, Germany,
Netherlands)
5. Preliminaryinjunction data
Germany 59% (24/41); Netherlands 40%
(15/37) Germany
1. Low patentee win rate
2. Slow time to trial
(France (≈3 years))
3. High cost(Germany, if lose;
England)
4. Likely case will be stayed for validity challenge (Italy)
England
5. Preliminaryinjunction data
(France, 20% (2/10);
73
Additional Factors
• Home Court Advantage
Litigating in a home jurisdiction can provide advantages, including
familiarity with courts and counsel, access to evidence and
witnesses, and name recognition/impact on local market
• Market Size
Litigation leverage is proportional to the size of the market and sales
of infringing goods; the larger the market, the larger the leverage
• Country of Manufacture, Exportation, or Importation
Litigating where the product is made, exported, or imported can also
provide leverage; a win in such jurisdictions can impact global
supply/sales chains
74
Additional Factors
• Enforceability
A litigation “win” is only meaningful if reliable enforcement
measures exist in a jurisdiction; the level of the opponent’s
contacts/investment in the forum can influence the ability to
enforce a judgement
• Available Remedies
The remedies available in a jurisdiction should align with the
needed remedies and goals for a strategy; what is available and
likely to be granted in a jurisdiction are equally important
75
▪ No res judicata effect of litigation outcome
in one country on litigation outcome in another
country (limited collateral estoppel).
▪ But, outcome of first litigation can provide
leverage and influence settlement of disputes
globally/in other jurisdictions.
o Investigate win rates and other metrics to
confirm strategy
o Parallel “first strikes” can be implemented
globally as a hedge
76
First Strike Strategy
Inter and Intra-Country Strategies
• Sue Simultaneously
Sue opponent in multiple jurisdictions simultaneously; can add
pressure and open opportunities/tactical advantages
• Sue Multiple Defendants
Sue multiple entities simultaneously; can include related
entities or business partners (distributors, importers,
exporters, and manufacturers); also adds pressure and opens
opportunities/tactical advantages
77
Inter and Intra-Country Strategies (cont’)
• Leverage Evidence in Different Jurisdictions
Evaluate law and ability to use evidence from one jurisdiction
(or forum) in another jurisdiction (or forum); this tactic can be
effectively employed as an inter or intra-country strategy
• Leverage Rulings in Different Jurisdictions
While no res judicata, such rulings may influence outcome in
other jurisdiction (or forum); party admissions related to those
rulings may also be submitted as evidence
78
35 U.S.C. 1782
― Section 1782 provides U.S. district courts the ability to grant discovery
requests for use in foreign proceedings:
[T]he district court of the district in which a person resides or is found
may order him to give his testimony or statement or to produce a
document or other thing for use in a proceeding in a foreign or
international tribunal . . . [and] [t]he order may be made . . . upon the
application of any interested person.
― U.S. district courts have broad discretion in considering and
deciding whether to grant Section 1782 requests.
79
Discovery in the U.S.
for use in Foreign Proceedings
Factors for granting a Section 1782 request:
1. Whether “the person from whom discovery is sought is a participant in
the foreign proceeding.”
2. The “nature of the foreign tribunal [and] the character of the
proceedings underway abroad.”
3. Whether the request “conceals an attempt to circumvent foreign
proof-gathering restrictions or other policies of a foreign country or
the United States.”
4. Whether the discovery requests should be scaled back to avoid undue
burden.
Intel Corp. v. Advanced Micro Devices, Inc., 542 U.S. 241, 264-65 (2004)
80
Discovery in the U.S.
for use in Foreign Proceedings
Avv. Vincenzo JandoliFRANZOSI DAL NEGRO SETTI
E-mail: [email protected]
HEARING OF DISCUSSION BASED ON THE COURT EXPERT OPINION
WHETHER TO GRANT INJUNCTION AND SEIZURE
Application For Injunction And Seizure (Italy)
IF GRANTED ONLY INJUNCTION AND NOT OTHER
MEASURES THE LITIGATION MAY STOP. OTHERWISE YOU
CARRY ON WITH THE FULL SCALE LITIGATION TO CLAIM
DAMAGES (WITHIN 1 MONTHS)
NOT GRANTED
FIXATION OF HEARING INTER PARTES (EX PARTE VERY
RARE) TO DISCUSS WHETHER TO GRANT OR NOT THE
INJUNCTION AND SEIZURE; NORMALY FEW DAYS BEFORE
THE HEARING COUNTERPART FILES THE DEFENCE
POSSIBLE APPEAL: DURATION
AROUND 2 MONTHS UNLESS NEW
TRIAL ACTIVITIES ARE ADMITTED
(VERY RARE)
AT THE HEARING
TECHNICAL EXPERTISE (DURATION AROUND 3/4 MONTHS EASY
CASE, NOT EASY ALSO AROUND 8 MONTHS) APPOINTMENT OF
COURT EXPERT FOR AN OPINION ON VALIDITY OF THE PATENT
AND INFRINGMENT
(~7 DAYS)
GRANT OR NOT THE INJUNCTION
AROUND
7 DAYS
81
Avv. Vincenzo JandoliFRANZOSI DAL NEGRO SETTI
E-mail: [email protected]
ACCESS EX PARTE AT PREMISES OF COUNTERPART WITH BAILIFF AND
COURT EXPERT
HEARING OF DISCUSSION INTER PARTES (THE COUNTERPART WILL FILE THEIR DEFENCE AND
WILL TAKE PART TO THE HEARING) WHETHER TO CONFIRM OR NOT DESCRIPTION AND –IF
REQUESTED- GRANT SEIZURE OR INJUNCTION (ABOUT INJUNCTION AND SEZIURE A
REASONABLE SCENARIO ARE POSSIBLE STEPS OF THE PREVIOUS SLIDE)
AROUND
2/3
DAYS
EXAMINATION AND DECISION TO GRANT DESCRIPTION EX PARTE
IN FEW DAYS
CONFIRM THE DESCRIPTION AND GIVE TERM TO
START THE FULL SCALE LITIGATION (WITHIN
AROUND 1 MONTHS)
NOT CONFIRM
FIXATION OF HEARING INTER PARTES TO DISCUSS
WHETHER TO GRANT OR NOT THE DESCRIPTION - NOT
PUBLIC DECISION (COUNTERPART MAY NOT BE
AWARE) PATENTEE CAN GIVE UP
GRANT
Access inter
partes
NOT
GRANT
POSSIBLE APPEAL: DURATION
AROUND 2 MONTHS UNLESS NEW
TRIAL ACTIVITIES ARE ADMITTED
(VERY RARE)
Application For Decription and Seizure or Injunction (Italy)
IN FEW DAYS
82
Avv. Vincenzo JandoliFRANZOSI DAL NEGRO SETTI
E-mail: [email protected]
The Judicial Description (Art. 128 IP Code)
▪ WHO: IT MAY BE REQUESTED AND OBTAINED EX PARTE BY THE PATENTEE OR
LICENSOR.
▪ WHERE (JURISDICTION): PLACE OF DEFENDANT OR WHERE THE INFRINGING
EVENTS TOOK PLACE. IF MORE THAN ONE, PLAINTIFF CAN CHOOSE AND
EXECUTE MORE DESCRIPTIONS EVEN SIMULTANEOUSLY.
▪ HOW: CARRIED OUT BY A BAILIFF WITH A TECHNICAL INDEPENDENT EXPERT
APPOINTED BY THE COURT (BUT WITH POSSIBLE INTERVENTION OF PATENTEE
LEGAL AND PATENT ATTORNEY COUNSELS ).
▪ WHAT: EX-OFFICIO DISCOVERY AIMED AT COLLECTING TECHNICAL (FORMULA,
DRAWINGS, ANALYSES ETC.) ACCOUNTING AND COMMERCIAL EVIDENCES
(ORDERS, INVOICES, TRANSPORTATION DOCS, CORRESPONDENCE, ETC).
83
Avv. Vincenzo JandoliFRANZOSI DAL NEGRO SETTI
E-mail: [email protected]
The Judicial Description (Art. 128 IP Code)
▪ WHO: IT MAY BE REQUESTED AND OBTAINED EX PARTE BY THE PATENTEE ORLICENSOR.
▪ WHERE (JURISDICTION): PLACE OF DEFENDANT OR WHERE THE INFRINGINGEVENTS TOOK PLACE. IF MORE THAN ONE, PLAINTIFF CAN CHOOSE AND EXECUTEMORE DESCRIPTIONS EVEN SIMULTANEOUSLY.
▪ HOW: CARRIED OUT BY A BAILIFF WITH A TECHNICAL INDEPENDENT EXPERTAPPOINTED BY THE COURT (BUT WITH POSSIBLE INTERVENTION OF PATENTEE LEGALAND PATENT ATTORNEY COUNSELS ).
▪ WHAT: EX-OFFICIO DISCOVERY AIMED AT COLLECTING TECHNICAL (FORMULA,DRAWINGS, ANALYSES ETC.) ACCOUNTING AND COMMERCIAL EVIDENCES (ORDERS,INVOICES, TRANSPORTATION DOCS, CORRESPONDENCE, ETC).
84
Avv. Vincenzo JandoliFRANZOSI DAL NEGRO SETTI
E-mail: [email protected]
Cross-Border Effect of the Description
DESCRIPTION CAN BE USED IN OTHER JURISDICTIONS
EXAMPLE #1: DESCRIPTION CARRIED OUT IN ITALY HAS BEEN USED TOCORROBORATE A PRELIMINARY INJUNCTION FILED IN SPAIN ON THE SAMECONTESTED MACHINE BUT VERSUS OTHER PARTY (DISTRIBUTOR); OR IN A FULLSCALE LITIGATION IN TURKEY
EXAMPLE #2: DESCRIPTION GRANTED BY THE JUDGE OF VENICE EXECUTED INGERMANY VERSUS GERMAN COMPANY. COURT OF VENICE 20TH FEBRUARY 2018AND GENOA 2ND MAY 2005.
85
Avv. Vincenzo JandoliFRANZOSI DAL NEGRO SETTI
E-mail: [email protected]
Cross-Border Effect of the DescriptionDESCRIPTION GRANTED EX PARTE AGAINST
ITALIAN COMPANY
BY DECREE OF 12TH MARCH
2019 REGARDING A MACHINE
FOR WELDING PROFILED
ELEMENTS IN PLASTIC
MATERIAL
GERMAN COMPANY
BY DECREE OF 20TH
FEBRUARY 2018
REGARDING A PLANT FOR
CONTINUOUS PRODUCTION OF
STEEL BARS
ITALIAN JUDGE’S ASSESSMENT
OF THE EVIDENCE ACQUIRED
DURING THE GERMAN
DESCRIPTION FOR GRANTING
THE INJUNCTION BY ORDER OF
18TH JUNE 2018
DESCRIPTION EXECUTED IN
GERMANY ON 20TH MARCH
2018
DESCRIPTION EXECUTED ON
14TH MARCH 2019
IT IS ALLOWED USE OF THE
EVIDENCE ACQUIRED DURING THE
DESCRIPTION UNLESS UNDER
CONFIDENTIALITY
(COURT OF MILAN 6.07.2017 –
21.01.2016; COURT OF TURIN
21.10.2019 - 13.06.2012)
USE OF THE EVIDENCE ACQUIRED
DURING THE ITALIAN DESCRIPTION
IN FOREIGN LITIGATION
Re: 1 Re: 2
86
Michael Crichton, Partner, Gowling WLG
As a go-to intellectual property legal adviser for
many clients, Michael frequently provides strategic
counselling and opinions regarding patent
infringement, patent validity and related issues. In
addition, as a registered patent agent for over a
decade, Michael's practice includes patent drafting,
prosecution and portfolio management.
+1 613 786 0248
Your Presenters
C. Gregory Gramenopoulos, Partner, Finnegan
Greg has more than two decades of experience
assisting clients in the electrical and computer
technology fields. He is an accomplished patent
litigator and strategic IP advisor, handling complex
and high-stakes patent matters both in and outside
of the courtroom. Greg has been recognized for his
work by Legal500 U.S., IAM Patent 1000, and other
top legal guides.
+1 202 408 4263
Vincenzo Jandoli, Partner, Avvocati Associati Franzosi Dal Negro Setti
Vincenzo specializes in different areas of consulting
activity (giving assistance to Italian companies
abroad-thanks to a good and relevant network of
colleagues worldwide created by working in team-
and to foreign companies in Italy) and of litigation:
+ 39 02 859091
Roland Kűppers, Partner, Taylor Wessing
Roland is an IP specialist, representing national and
international companies in patent infringement
proceedings and coordinating cross-border litigation.
In collaboration with patent attorneys and corporate
patent departments, he advises on patent nullity,
opposition and utility model cancellation
proceedings.
+49 211 8387 297
Your Presenters
Chris Thornham, Partner, Taylor Wessing
Chris is an award-winning lawyer specializing in
patents and technical disputes. He works with
clients across the life sciences, engineering, and
telecoms sectors. He advises clients on freedom to
operate, product launch, patent litgiation, and
licensing strategies including FRAND license
disputes.
+44 20 7300 4817