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Summary:

Big tech firms want to make sure that a soon-to-launch unified European patent system doesn’t let trolls game the system on a wide scale, so they’ve asked for modifications to the rules of the new EU patent court.

Troll
photo: Flickr / puuikibeach

A broad alliance of technology companies, including Google, Apple, Microsoft and Samsung, has asked European authorities to fix the rules for an EU-wide Unified Patent Court ahead of its launch, in order to fend off patent trolls.

These tech giants are no strangers to patent wars — their global skirmishes have touched on Europe on a number of occasions. But this isn’t about such titanic conflicts – it’s about so-called trolls; companies that don’t actually make anything themselves, but that rather buy up patents and use them to turn practicing tech firms (particularly small, defenseless ones) into cash machines.

These bullying tactics are all too familiar in the U.S., largely because the U.S. allows relatively abstract concepts to be patented. In the European Union, software patents are not granted quite so freely, but the big tech firms still worry about the rules that will apply under a new patent regime that will launch in 2014.

Unification risks

Europe has been trying to unify its patent system for a good three decades, largely on the basis of cost – it is crazily expensive to get a patent that applies everywhere in Europe, because it means applying in dozens of countries, many with their own languages.

At the end of last year, the European Parliament finally approved an EU-wide patent system. Part of this will involve the ability to apply once and win patent protection everywhere in the EU, but another major strand is the creation of a Unified Patent Court (UPC), which will do away with the need for parallel patent litigation in different national courts. The UPC will however comprise multiple courts itself.

It’s the UPC’s rules that Microsoft, Apple, Samsung, Google, HP, BlackBerry, Cisco, Deutsche Telekom, Intel, Yahoo and others (it really is quite the roster) are worried about. Specifically two things:

  • Bifurcation: Under the UPC Agreement, different courts will be able to judge on two strands of a case, namely the validity of the patent and whether or not it was infringed. The tech companies are worried that the holder of a low-quality, over-general patent might be able to win a quick infringement ruling in a friendly jurisdiction, before the other court has established whether the patent is rubbish.
  • Injunctions: The companies also think the rules aren’t clear enough about the threshold for injunctions, particularly as an injunction could now apply across the whole EU, rather than just in one country.

As Google explained in a blog post on Thursday:

“The economic impact of patent troll litigation [in the U.S.] has been enormous, draining an estimated $29 billion in direct costs from productive enterprises in 2011 alone. Over the years Google has faced down hundreds of patent claims, mostly from patent trolls, but only after paying millions of dollars in legal fees.

“Europe now has a clear opportunity to adopt rules that limit the risk of fostering patent trolling in Europe. Patent trolls have no real business interests to defend. So, at the very least, trolls should have to prove their patents are actually valid and consumer harms should be considered before giving trolls blocking orders that would impact 500 million Europeans.”

These are valid concerns. As we have seen in Germany with the Apple-Motorola battle in particular, patent disputes have led to popular products being removed from store shelves, albeit very briefly. That kind of disruption could be hugely magnified once one patent ruling applies across the EU, so it’s very important to get this stuff right before the system lurches into action.

I’ve asked the office of Michel Barnier, the internal market commissioner who has shepherded the creation of the UPC, for comment on the tech firms’ concerns, and will add it in as and when I receive it.

  1. One man’s troll is another person’s pension. There are very few genuine new ideas and as in the past in Europe esp Italy the reward went to the person that introduced the product to the local market first. Patent troll litigation seems a US invention as, at a casual glance, patents are too easily granted on your side of the Atlantic …

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  2. EU should explicitly outlaw software patents as part of any patent unification process. I guarantee you that this will result in some small country making software patents available as a revenue generation scheme and then the whole EU will be just as screwed up as the USA. EU programmers, grab your pitchforks and torches and stop this legislation before it goes too far.

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  3. Craig Richard Lloyd Thursday, September 26, 2013

    This coming from Apple who patented the bounce at the end of a scroll and used it to file an injunction against Samsung. Bloody hypocrites the lot of them. yes, the patent system is clearly broken, but there are too many vested interests to ever get it properly fixed.

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  4. well, if US is ready to cut down monopoly given on patent down to practical 5-7 years… otherwise good patent can be only dead patent system. read book Information feudalism http://amzn.to/15vbvlj you will never shake hand of IPR lawyer anymore.

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