04.11.20

The Fall of the UPC – Part XIX: How Law Firms Responded to the Collapse of the UPC (Lying Was All Too Common)

Posted in Deception, Europe, Patents at 2:31 am by Dr. Roy Schestowitz

UPC dead. This is Fine. We'll lie to our clients more.

Summary: Our detailed ‘literature survey’ after the fall of the UPC reveals a lot of law firms in denial and/or eager to lie to their clients (to save face in the short run)

WE are almost done with this 20-part series. Today (or tonight) we assess the responses from various law firms — at least all those whose responses we were able to find (and have not already covered in prior parts).

Today’s European Patent Office (EPO) works not for science or for scientists. Ask EPO examiners about it; they’ll say the same. António Campinos and his nontechnical predecessor wouldn’t know science if it hit them right in the face; they work for law firms. To put in perspective just how appalling that is (considering the original purpose of patent systems), imagine a canteen that serves food to match the colour of the plates rather than serve/cater/facilitate the nutritional requirements and other preferences of diners. Why would diners tolerate such a canteen? Well, in the case of the EPO it is a monopoly in Europe, so ‘diners’ (like applicants) would have no other choice.

“…in the case of the EPO it is a monopoly in Europe, so ‘diners’ (like applicants) would have no other choice.”With that in mind, let’s look and discuss how law firms — not actual scientists, engineers and so on — responded to the decision of the German Federal Constitutional Court (FCC) after it had killed the Unified Patent Court (UPC) for good.

We already took note — about a month ago — of this response from AJ Park’s Sam Pearson and Christine Egan. AJ Park was mentioned here many times in the past because of its shameless lobbying for software patents in New Zealand, Australia and elsewhere. From half the planet away these people obviously rooted for the UPC, knowing it would be a Trojan horse or a ramp for software patents in Europe (and elsewhere). They were so disappointed even before the FCC’s decision and so was HGF Limited, which published “UK Will No Longer Seek To Participate In Unitary Patent And UPC” (there’s nothing to actually participate in as the UPC does not even exist). Here’s what they said:

The UK Government has confirmed the UK will no longer seek to be part of the proposed unitary patent (UP) or Unified Patent Court (UPC) systems. Given the UPC’s alignment with the CJEU, this is not entirely surprising for the UK in a post-Brexit world.

Although it will be unwelcome news for many, the certainty of this new stance may mean the UP and UPC can again pick up momentum, subject to the ongoing legal challenge in Germany and re-working of the agreements without the UK’s participation.

Days later we knew that this “legal challenge in Germany” was successful, thwarting the UPC for good. So statements like “seek[ing] to be part” are moot; you cannot “be part” of things that don’t exist. This is the kind of lie UPC proponents have told for over 2 years; we kept correcting them, but it never stopped the lie from coming back again and again. For over 2 years!

“Their ‘pet project’ is dead and France is the only country with key ratification in place (Britain informally walked back on its own and Germany is unable to ratify).”Over at Lexology, REGIMBEAU’s Sylvain Thivillier and Henri Bourgeois wrote that the “Unified Patent Court the German federal consitutional [sic] court has finally issued its decision regarding the ratification process in Germany” and like several others their headline conspicuously omits the actual outcome. We don’t think that’s a coincidence. It’s likely deliberate and it’s most probably a face-saving spin tactic. These people will have more to worry about than record-breaking death tolls in France (highest in Europe right now and thus far). Their ‘pet project’ is dead and France is the only country with key ratification in place (Britain informally walked back on its own and Germany is unable to ratify).

At Mondaq, the ‘base’ of litigation zealots, Graham Burnett-Hall (Marks & Clerk) perpetuated old myths about UP/C, who/what it’s for, and who came up with it. Death of something like the UPC is fantastic news to everyone except the UPC boosters, who are less than 1% of the population, but this is what Burnett-Hall wrote for Marks & Clerk, a key player in UPC lobbying:

The German Constitutional Court issued its long-awaiting decision regarding the compatibility of the German law passed to allow Germany to participate in the Unified Patent Court (UPC) and the associated unitary patent, holding that the German law had not been passed with the necessary majority and was therefore void. New German legislation will need to be passed in order for the UPC project to proceed. This, coupled with the changes that will be needed to deal with Brexit, is likely to take years. It is therefore a major set-back for those businesses and IP professionals who were hoping that the UPC and unitary patent would usher in a new era of IP harmonisation across Europe.

The Unified Patent Court Agreement was concluded in February 2013, after years of negotiations. The basic idea was that holders of European Patents would, once the relevant patent application proceeded to grant, be able to elect for the granted patent to have unitary effect in the territories of all the participating countries. The validity and infringement of these unitary patents would be decided in a single court proceeding in the new Unified Patent Court, which would have “local divisions” in any country that wanted one and a “Central Division”, which would hear revocation actions and certain other proceedings. The UPC would also have jurisdiction to hear infringement and validity proceedings regarding non-unitary European patents (that is, European patents that on grant are validated in individual countries in the usual way), save to the extent that patent owners opted out these patents during an initial transitional period.

Notice the optimism, e.g. “likely to take years.” They insinuate that this is somehow inevitable or just a matter of time.

“New German legislation will need to be passed in order for the UPC project to proceed,” they say, as if all they need to do now is create a little legislative patch. Never mind if the FCC did not deal (or has not yet dealt) with various core issues in the complaint and additional complaints can be filed with additional legal grounds.

“…additional complaints can be filed; we’ve named additional possible grounds.”The UPC is dead, as is the credibility of Marks & Clerk; how many times did they lie in the press about the UPC? We’ve lost count. They kept appearing in English, Scottish and international media with their misleading puff pieces, which turned out to be embarrassingly wrong.

Moving on, here’s FRKelly’s David Brophy, a big booster of UPC. In Lexology and FRKelly’s own site he wrote: “The German Federal Constitutional Court (which is the country’s “supreme court” for all matters constitutional) has ruled that the 2017 ratification of the Unified Patent Court (UPC) agreement in Germany’s parliament was unconstitutional.”

True. So will you retract all the nonsense you told clients over the years?

No?

Too soon?

Also in Lexology we’ve found promoted this FB Rice article which spoke of “the prospects of the UPC being implemented [as] very low.”

“It’s not inevitable.”Oh, finally a shimmer of sincerity. Let’s read further: “Following a constitutional challenge, Germany’s participation in the UPC has now been rejected. The German Federal Constitutional Court (FCC) has decided that the act of approval to the UPC agreement is void because it was not approved by two thirds of the members of parliament (Bundestag). This will require new acts of approval by the parliaments of the member states. Therefore it is likely that there will be substantial delay. In addition, It is likely that other substantive issues not yet decided by the FCC will be raised. Consequently, the prospects of the UPC being implemented is very low.”

They say “it is likely that there will be substantial delay.”

Why delay?

It’s not inevitable. In fact, all the momentum has been lost and they admit that “other substantive issues not yet decided by the FCC will be raised.”

And additional complaints can be filed; we’ve named additional possible grounds.

Looking eastwards, considering some German lawyers/attorneys, Mayer Brown’s Benjamin Beck and Ulrich Worm promoted in Lexology their article entitled “German Federal Constitutional Court Decides that German Ratification of UPC Agreement is Void” (accurate enough).

Dr. Worm on the litigation ‘industry’ losing its marbles:

In an order published today, the German Federal Constitutional Court decided that the Act of Approval to the Agreement on a Unified Patent Court (“UPC Agreement”) is void. In its reasoning, the Court held that the ratification of the UPC Agreement violated democratic principles as the Act of Approval was not passed by two thirds of the members of the German Parliament (Bundestag). Thus, the Bundestag did not effectively pass the Act of Approval.

The UPC Agreement is part of a regulatory package on patents which ultimately aims at introducing a European patent with unitary effect at EU level. If the UPC Agreement were ever to become effective, it would provide for the establishment of a Unified Patent Court as a court common to all participating Member States for disputes concerning European patents and European patents with unitary effect.

This is reasonably accurate. We won’t blast Mayer Brown, not for this one anyway…

About a month ago Slaughter and May’s Catherine Cotter published through Lexology “No Unified Patent Court or Unitary Patent system for UK – will the entire project now be abandoned?”

She knew even then. Her original piece was followed by another Lexology promotion of her piece with a headline that said, “final nail in the UPC coffin?”

How courageous of her to be this blunt. Slaughter and May’s Catherine Cotter admitted even back then that the UPC was likely dead, but she looked for something positive to say (for them there’s no valid spin). So here we go:

In previous posts here and here we have looked at the so-called demise of the Unified Patent Court (UPC) and the Unitary Patent (UP) from the UK perspective, especially in the post-Brexit intellectual property landscape.

Now it is Germany’s turn to take the spotlight.

[...]

First, the Court did not agree with everything in Stjerna’s complaint. Some parts of the complaint were ruled inadmissible, namely Stjerna’s complaints about the democratic deficiency inherent in the regulatory structure of the UPC, the lack of independence of the UPC judges and the irreconcilability of the UPC Agreement with EU law. This could be taken as the Court believing that the UPC itself is not inherently unconstitutional.

Second, although the decision is a technical one, in practice it may not be so easy for the German government to obtain the required two-thirds majority, especially with both the COVID-19 pandemic taking over the legislative agenda and the UK’s now apparent intention to no longer participate in the UPC project.

Yes, other people took note of that second point. The pandemic only further damages Team UPC’s ’cause’ and the timing of this decision was therefore ‘perfect’…

Catherine Cotter later wrote (also promoted in Lexology) the following:

We recently reported that the UK is no longer intending to participate in the EU’s Unified Patent Court (UPC) and Unitary Patent (UP) system, due to the irreconcilable differences between the UK and EU as to the role of the Court of Justice of the EU (CJEU) and EU law. Although the UK government has not made an official announcement, it was reported in the Law Society Gazette in an article entitled ‘Downing St deals death blow to UK role in euro patent court’ that a spokesperson for the PM had said: ‘The UK will not be seeking involvement’ in the UPC and the associated UP’.

On 10 March 2020, the House of Lords European Justice Sub-Committee met to examine the impact that the UK’s non participation in the UPC and UP would have on UK businesses, UK inventors and the UK Courts. Julia Florence, Past President of Charted Institute of Patent Attorneys (CIPA) and Daniel Alexander QC, highly regarded IP barrister and Chairman of Intellectual Property Bar Association, gave evidence to the Committee. The recording of the meeting is here.

Quite a 'debate', eh? The wolves gathered to discuss rights of sheep. OK, whatever…

Moving on a bit, Erik Heilmann and Irene Corn (Dennemeyer Group) wrote this 4 days after the FCC’s decision (or so it seems based on the timestamp). Bad timing. Prepared before the final nail on the UPC coffin? Published anyway? This is what they said in “All Eyes On Germany As The UK Says ‘No’ To The Unitary Patent System”:

In contrast to last year’s promises, yet unsurprisingly, it has been revealed that the UK Government will not participate in the Unified Patent Court (UPC). As recently confirmed by a spokesperson of the UK government, “participating in a court that applies EU law and bound by the CJEU (Court of Justice of the European Union) is inconsistent with our aims of becoming an independent self-governing nation.”

The decision sparked dismay among IP lawyers in the UK, especially since London was supposed to be the location of one of the three main courts for litigating unitary patents. Given that membership of the UPC is a prerequisite to join the Unitary Patent system, the consequence is that the UK will not be able to join the system altogether. This raises the question of whether the new harmonized patent system will eventually be attractive to patent holders without the United Kingdom as a member.

Why was this published days after the decision was already known?

Dennemeyer & Associates SA’s (Dennemeyer Group) Irene Corn also
said that the “complaint brought by Dr. Stjerna in 2017 is founded and therefore, the implementing legislation in Germany is to be deemed as void.”

This was spread to a broader audience in Lexology and Mondaq [1, 2] and it’s neither entirely wrong nor dishonest. To quote:

Just a couple of weeks ago, it was revealed that the UK government would not seek membership of the Unitary Patent Court (UPC). With the appealing UK market gone, the German Constitutional Court (“Bundesverfassungsgericht”) delivered today another blow to the hopes of those still wishing for an early start of the Unitary Patent system. The Court decided that one of the grounds of the constitutional complaint brought by Dr. Stjerna in 2017 is founded and therefore, the implementing legislation in Germany is to be deemed as void.

Correct.

Contrariwise, Dr. Thomas Hirse from CMS Germany is not being candid. This was not a “surprise decision” and moreover it was the correct decision (unless one drinks Kool-Aid from Team UPC). He promoted in Lexology this article of his, which said:

In a surprise decision, the BVerfG has admitted the complaint and declared the German ratification act null and void.

It’s not a surprise. We expected this.

AWA’s Johan Hansson and Niklas Mattsson wrote: “German Court finds Unified Patent Court legislation unconstitutional” (Lexology title)

“Today’s decision could mean that the court agreement and associated Unitary Patent regime will never become operational,” they admitted in their site. Here’s more:

Today, the court tasked with upholding Germany’s constitution, the Bundesverfassungsgericht, has issued its long-awaited decision on a complaint against ratifying the Unified Patent Court Agreement (UPCA).

The Court’s decision upholds the complaint, finding that the German legislative act that ratifies the UPCA does indeed contravene the German constitution. The German Federal President is now prohibited from assenting to the UPCA ratification. According to today’s decision, ratification of the UPCA by Germany should have been passed by a two-thirds majority by the German parliament.

Today’s decision could mean that the court agreement and associated Unitary Patent regime will never become operational. Parties interested in establishing a central European patent jurisdiction will have to think of other ways to reach their goal. It remains to be seen whether the German legislators will make an attempt to pass the law with the majority required by the constitutional court.

That last sentence (“It remains to be seen whether the German legislators will make an attempt to pass the law with the majority required by the constitutional court”) may be missing the point that the complaint has not yet been dealt with on substance. This means that even if another vote was coordinated and if people actually passed the darn thing, it would still face a number of big constitutional barriers. So it’s a non-starter really…

One basis/theme in this existing complaint (more can be filed with additional grounds) is only reinforced by Britain’s position amid Brexit. Time isn’t on Team UPC’s side!

“One basis/theme in this existing complaint (more can be filed with additional grounds) is only reinforced by Britain’s position amid Brexit. Time isn’t on Team UPC’s side!”Herbert Smith Freehills LLP very well knows that the UPC sailed out and and away a long time ago. The route to nowhere…

But the article they’ve promoted says this (“No plain sailing for the UPC”):

The Bundesverfassungsgericht (German Federal Constitutional Court) has this morning announced that it has found (by a majority decision) that the Act of the Bundestag which sought to approve and implement the Unified Patent Court in Germany is void. The Court indicated that the Act would amend the German constitution in substantive terms, but had not been approved in the Bundestag with the two-thirds majority necessary for such amendments.

In its press release, the Court stated that “in order to safeguard their right to influence the process of European integration by democratic means, this, in principle, also entails the right of citizens that sovereign powers be conferred only in the ways provided for by the Basic Law. An act of approval to an international treaty that has been adopted in violation thereof cannot provide democratic legitimation for the exercise of public authority by the EU or any other international institution supplementary to or otherwise closely tied to the EU.”

It’s the end.

Another piece was titled “The End Of The UPC As We Know It?”

Rachel Fetches (HGF Ltd) should know. It’s the end of the UPC altogether. They might try other things, which can take another decade and go nowhere (again). And no, “UPC prep committee” is no credible source; they lied for years. Liars as an occupation. Here’s what she wrote:

The German Federal Constitutional Court has issued a decision* (in German) which ruled the German UPCA Ratification Law to be unconstitutional and void. However, the court dismissed the second set of arguments (violation of fundamental democratic rights and the principle of separation of powers) as inadmissible.

So while a significant blow to progress of the UPC, it is possible that the UPC bill could be presented once more to the Bundestag, where the present Government might be able to get the required two-thirds majority. Of course, this will take a while to be tabled in view of the present global COVID-19 crisis and also raises the possibility of whether the same complaint could be brought again but focussed on more substantive aspects like transfer of sovereign rights, issues with the EPO, judges, to name but a few. Furthermore, given that the UK has indicated it will no longer seek to participate in unitary patent and UPC, the agreement in its current form would need significant amendment before it could again be taken through the German constitutional process.

It probably won’t happen.

Here comes Bird & Bird LLP’s longtime UPC liar Wouter Pors, who is once again lying about what happened at FCC and why UPC died. Lexology promoted these lies which can be found in the firm’s site. It started with nonsense and then said: “According to the Court this is crucial, because the UPCA forms a material change to the German Constitution, which requires a majority of two thirds of the members of parliament.”

“Remember that they haven’t yet looked at the substance. If they do, it won’t get any better for Team UPC.”Constitutional changes cannot be made; and you cannot just adjust the Constitution to ‘fit’ the un-Constitutional UPC. Anyway, the article is so full of errors (or lies), but that’s just consistent with whatever comes out of Pors’ mouth….

His former colleague, the complainant, cannot stand him. It’s not hard to see why.

Finnegan, Henderson, Farabow, Garrett & Dunner LLP’s Sanam Habib, Nicholas Fox and Maeve O’Flynn begrudgingly accept that the UPC is dead but downplay the severity of the situation. Finnegan stood to gain a lot from the UPC and it routinely lobbied for it. They promote their article in several sites [1, 2] and said: [original here]

Earlier this year, the United Kingdom (UK) decided to not participate in the Unified Patent Court (UPC) system. As of this morning, it appears Germany may follow in UK’s footsteps.

In June 2017, the German constitutional court (Bundesverfassungsgericht) asked the German legislator to not put the implementing legislation for the UPC and Unitary Patent into force. The complaint, which was brought forward by a German attorney, highlighted that the manner in which German Parliament had approved UPC violated the German constitution.

After almost three years, the German constitutional court at last made a decision. An official press release was published by the Bundesverfassungsgericht this morning, holding that the Act of Approval to the Agreement on the UPC is void. A majority of the judges of the Court were of the view that the German basic law required that the act establishing the Court needed to be passed by a two-thirds majority in the German parliament as it would grant a supra-national court jurisdiction over matters which would otherwise be dealt with in the German courts. The decision was clearly finely balanced with some members of the court issuing dissenting opinions.

This is the old spin which we responded to in early parts of our series. They make it sound like a sport, where there’s a “Score” rather than “Outcome” — where they say “We nearly won” rather than “The outcome had us defeated…”

Anyway, what else can be expected from Finnegan? Maybe they’ll tell their clients that the UPC is “almost there” because of the FCC “issuing dissenting opinions…”

Remember that they haven’t yet looked at the substance. If they do, it won’t get any better for Team UPC. Some aspects of the complaints are even stronger now due to Brexit, newer EPO abuses and so on.

Thomas Mayer, Jonathan Konietz and Gordon Harris (Gowling WLG) chose to say “delays” instead of “kills” (“GERMAN CONSTITUTIONAL COURT DELAYS UPC”).

Are they lawyers or liars?

They intentionally mislead clients, who will lose money because of these lies, wrongly assuming that the UPC is coming soon; or that it’s not doomed but merely “delayed”. They pushes these lies into Mondaq and Lexology. Imagine seeing this headline, then thinking, “oh, so we just need to wait a little while longer…”

“In Germany today,” they stated, “the Federal Constitutional Court (Bundesverfassungsgericht) has held that the statute by which the German Parliament (Bundestag) sought to ratify the UPC Agreement (the ‘Act of Approval’) is void. This means that Germany’s ratification of the UPC Agreement, will be delayed, probably considerably, as will the introduction of the new UPC and unitary patent system itself.”

Delayed? What makes them think it’ll happen at all? This is really bad ‘lawyering’. To put it bluntly, they’re lying. They probably even know they’re lying. Or maybe they had Coronavirus spreading in the office, rotting all the brains.

Last but not least we have LGV Avvocati’s Tankred Thiem, who published this paper [PDF] that said: “Citizens with a right to vote have also a right to control formal correctness of laws transferring powers to supranational entities.”

There’s a summary in Lexology. [via]

“To put it bluntly, they’re lying.”It includes the text: “UPC in stormy weather: after UK’s UPC-exit, Germany’s law authorizing UPCA ratification, passed without a qualified majority, was held null and void.”

The term “stormy weather” is again somewhat of an understatement, but it probably won’t qualify as a lie. Compared to some of the worst responses we’ve covered — some of which optimistic enough to imply (or tell the target audience) that the UPC is inevitably coming very soon — this isn’t too bad.

In our next and final part we’ll conclude with some words and take stock of the lessons learned.

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