As of 1st October we see a few but substantial changes in German patent procedural law. Let’s pick the most interesting. Considering the pre-eminent position of Germany as a favourable patent jurisdiction in Europe its no wonder the German Federal Court of Justice (Bundesgerichtshof, “BGH”) was flooded with patent invalidity cases (roughly 200 pending cases for 2009 with an estimated duration 4 to 5 years each). Many in and outside Germany agree this time frame must be lowered to let Germany prevail as a jurisdiction of choice. The German legislator adopted an amendment law earlier this year with the aim to strengthen the competitiveness of the German patent system by considerably reducing the duration of patent invalidity proceedings.
Up to now, the German patent procedural law provided for a second full instance in those proceedings: firstly at the German Patent Court, then in appeal before the BGH. This was a de novo hearing so the whole enchilada of prior art and invalidity arguments got a second look by the appeal judges. Which in turn means in many cases again (new) experts are heard which further delay proceedings. No wonder some litigants showed a tendency of wilfully prolonging the proceedings by wearing out the opponent. This provision could deliberately be used in order to weaken the position of the opponent by depleting his (financial) resources.
The new German patent procedural law, in force since October 1, 2009, provides only one full instance, the German Patent Court. Now the BGH no longer is a court of second instance but rather acts like in (other) German civil procedural cases as a “watchdog” for the proper application of patent law. So no more appeal on the facts but only on issues of law are permitted. This will not enhance legal certainty for third parties on what is correct interpretation of patent law it will, is expected, drastically shorten the proceedings. Moreover, the amendment is also likely to shorten the duration of infringement proceedings which could and can be suspended by claiming the invalidity of the patent in question.
Not only the term of the appeal also the proceedings as such are being changed by the new law. The first instance court has to point out those questions to the parties that it finds to be crucial to decide the case, but which have not been properly dealt with by the parties in their written submissions to the court. Thus, the parties can concentrate their pleadings on questions of fact and questions of law that really matter and with which the court will actually deal in depth. Accompanied by a fixing of a time-limit, the parties are no longer allowed to introduce unexpected new facts in the proceeding, which neither appeared in the written submissions nor in the response to the advice of the court. Under the old regime unexpected new facts were regularly presented to the court and the opponent only in the oral hearing or even later in the appellate procedure. Both the court and the opponent are now better protected against such salami tactics behaviour.
But is there really nothing to complain about? Well, we are not sure. Certainly, to some extent, the second full instance helped a lot giving the German patent jurisdiction the high esteem it has in international patent community. By doubling the trails it was much more likely to come to really well founded and balanced decisions in patent invalidity cases. And perhaps it was not only a pleasant side effect to use the old provision of deliberate ‘prolonging’ the patent proceedings but the point that made the German patent courts so tempting to the international crowd. The recent change might jeopardize this attractiveness. Nevertheless, while observing the actual impact, we can look forward to shortened patent invalidity proceedings and, in case of the viability of the patents, thereby ‘extended’ terms of protection of patents whose validity no longer is contestable.