Litigation / Foreign Patent Litigation / Germany

Patent Litigation in Germany

In Germany, questions of infringement and validity are dealt by different tribunals. Limited use is made of oral proceedings, most of the procedure being written. Decisions are reached relatively quickly and the costs are not too high. However, although in principle the owner of a patent right can seek inspection of a possible infringement, discovery proceedings are unlikely to be of help.

Scope of Protection given by patent claims

Claims were traditionally construed very broadly to cover anything using the same inventive concept as the invention claimed. The current law adopted the EPC provisions that protection was to be afforded in accordance with the claims interpreted in the light of the specification and may lead to narrower interpretations.[1] However, the doctrine of equivalents is well recognized. Contributory infringement is actionable unless the material supplied is a staple article of commerce.[2] Induced infringement is actionable. Furthermore, the offer, commercial disposal, use or importation of the direct product of a process patent is an infringement of that process patent.[3] The German courts have not adopted an exhaustion of rights approach to patent infringement except where, as discussed later, this is required for compliance with the EEC's free flow of goods doctrine. Thus, German courts have, for example, granted injunctions to prevent importation of patented products into Germany from the United States even though the goods in fact originated from the owner of the German patent.[4]

Enforcement

Actions for patent infringement can only be brought in certain land or district courts (Landsgerichte) most of which have special facilities for hearing such cases. These courts are in Brunswick (for Lower Saxony), Düsseldorf (for North Rhine-Westphlia which includes the Ruhr), Frankfurt for Hesse and Rhineland-Palatinate, Hamburg for Hamburg, Bremen, Mecklenburg and Schleswig-Holstein, Mannheim for Baden-Wurtenburg, Leipzig for Brandenburg and Saxony, Berlin, Saarbruken for Saarland and Munich and Nuremberg for Bavaria. The vast majority of cases are brought in Düsseldorf or Munich. For the lander of the former East Germany, it is understood that patent chambers have been set up in the courts in Berlin, Leipzig, Rostock and Dresden. Jurisdiction may be based either on the place of infringement or the location of the principal place of business of the infringer.

Appeals lie to the Regional Court of Appeals (Oberlandsgericht) and then to the German Supreme Court (Bundesgerichthof) in special cases, for example, if there is an undecided legal issue of general importance.

Infringement proceedings require the use of a general lawyer (a rechtsanwalt) who may in fact be a patent specialist. He will probably be assisted by a patent attorney (patentanwalt). In nullity proceedings before the patent court, a patentanwalt will normally appear alone. In an infringement action a rechtsanwalt can only appear before the specific Landsgerichte and Oberlandsgericht to which he is admitted.

Litigation Procedure

In Germany, a letter before action is almost essential if one is to avoid the risk of not being able to obtain full relief. On the other hand, the issue of unjustified warning letters can give rise to the risk of an action by the recipient for unjustified interference with its business operations. The warning letter is followed by a complaint.

Invalidity of a patent is not a defense to an infringement action, but the defendant may institute proceedings in the patent court in Munich for nullity.[5]

The patent court can issue a decision of total or partial nullity.[6] In the latter case, the scope of patent may be limited by amendment of the claims, specification or drawings. Voluntary limitation of the claim by the patentee is also possible.[7] An infringement action is unlikely to be stayed while the patent court decides on the nullity action unless the court thinks that it is probable that the patent court will completely or partially nullify the patent.[8] To this extent, therefore, the nature of the prior art is relevant to German infringement proceedings. It is also relevant to the question of how broadly the court will construe the claims. Patents granted under the old law may still be entitled to the traditional "inventive concept" interpretation. Even under the new law, if the court regards the patented invention as being a major step forward, this is likely to result in a broader interpretation than if the advance is fairly small.

It is possible to move for an interlocutory injunction. The availability of such an injunction varies to some extent with the court in question (they are more readily obtainable, for example, in Munich than in Dusseldorf).

In order to obtain an interlocutory injunction, it is necessary to demonstrate that the act in question is a clear infringement and that urgent relief is needed. In such a case, relief can be very quick, even as rapid as a single day. There is ample anecdotal evidence of seizures of alleged patent infringements pursuant to court orders when such infringements were displayed at trade fairs in Germany, the court bailiff after arriving to make the seizure only a few days after the fair has opened. Delay in seeking interlocutory relief shows that the matter was not in fact urgent and may well defeat an application. In any case, such an injunction is only likely to be granted if there is no doubt about the fact of infringement.

The German system provides little help to a plaintiff in civil proceedings in attempting to secure evidence to prove its case.[9] The procedure followed varies somewhat between courts. Traditionally, German civil litigation has been fairly unconcentrated involving a series of meetings with the judge to narrow the issues with briefs being exchanged before and after them. In recent years, some courts have adopted a more concentrated procedure (the so-called Stuttgart Verfahren) in which there may be only a single preliminary hearing to set out a timetable in accordance with which the parties must submit their written evidence and arguments and then a single formal oral hearing at which all issues are resolved. If live testimony is needed, this will be at a separate evidentiary hearing. It is pointless to submit witnesses who are connected with one of the parties to the case since the court will assume that such persons will testify to support the party in question. If evidence is taken, the witness is questioned primarily by the court, although supplementary questions by the parties' representatives may be permitted. Under German procedural rules, the court may appoint an expert to assist in its determination of the case. However, at least in those courts that hear the bulk of infringement actions, the appointment of such an expert is unusual. If an expert is appointed the cost normally falls on the plaintiff since he bears the burden of proof. The expert's function is to produce a written report on which he may be questioned by the court and the parties prior to the court making its decision.

The burden of proof is on the plaintiff. However, reversal of burden occurs in respect of patented process for producing novel product in that there is a presumption that the patented process was used to prepare the product.[10]

Damage awards in Germany are based on the patentees lost profits if these can be determined, otherwise on the infringers' actual profits or a normal license fee. There is no provision for increasing the award in cases of willful infringement. The prevailing party will, however, be able to cover the costs that were necessarily incurred in bringing the action. Such fees include attorney fees, court fees and necessary expert's fees. The limitation period for damage claims is three years from the date on which the plaintiff first knew of the infringement and is subject to a general prescription requirement that the action must be brought within 30 years of the date on which the infringement actually occurred.[11]

General lawyer's fees in Germany are regulated by the state and lawyers are not allowed to charge less then a specified amount, although higher rates can be agreed upon with clients.[12] The fee structure is based upon the value of the case (the streitwirt). However, it also depends upon what is actually done in the case. A lawyer is entitled to separate fees (each of the same amount) for 1) pretrial work, 2) oral hearing of case, 3) evidentiary hearings and 4) attempting a settlement of the case. Fees for patent attorneys are not regulated by the statute but normally follow those of general lawyers. The value of the case is determined by the court in the light of submissions made by the parties. A full infringement action in Germany typically takes a year to 18 months at first instance unless stayed pending a decision in a nullity action. A further year is required for an appeal.