EU court removes German barrier to preliminary patent injunctions

The judgment of the Court of Justice of the EU (CJEU) addresses an area of uncertainty that had arisen under German patent law and is likely to lead to an increase in applications for preliminary injunctions for European patents in Germany and potentially across the EU, according to experts in patent litigation at Pinsent Masons.

"The CJEU decision is a tectonic shift for preliminary injunction proceedings in Germany, the European jurisdiction with most patent infringement proceedings," said Marc Holtorf, Munich-based patent expert at Pinsent Masons.

A regional court in Munich had asked the CJEU for guidance on the application of EU law to help it determine whether it is allowed to grant a preliminary injunction to technology company Phoenix Contact in respect of a patent it holds.

According to the CJEU’s ruling, the Munich court was minded to grant the application against Harting Deutschland and Harting Electric to prohibit the companies from infringing the Phoenix patent. However, it identified German case law that it said precluded it from granting applications for preliminary injunctions for patents if the validity of those patents had not been confirmed at least in first instance opposition proceedings before the European Patent Office or in first instance invalidity proceedings before the Federal Patent Court in Germany.

Holtorf said: "Only in 2019 did Germany's most prominent patent courts of appeal, in Munich, Karlsruhe and Düsseldorf, eventually align their requirements for issuing preliminary injunctions in patent cases which massively increased legal certainty in such proceedings."

In assessing how the Munich court should approach the case, the CJEU said that the German case law runs contrary to EU law – specifically the so-called EU Enforcement Directive, Directive 2004/48/EC on the enforcement of intellectual property rights. It said national courts are bound to set aside national case law where it is incompatible with EU law.

As a result, it held that the Enforcement Directive “must be interpreted as precluding national case-law under which applications for interim relief for patent infringement must, in principle, be dismissed where the validity of the patent in question has not been confirmed, at the very least, by a decision given at first instance in opposition or invalidity proceedings”.

In reaching its decision, the court highlighted that European patents “enjoy a presumption of validity from the date of publication of their grant”.

The court also flagged a series of safeguards built into the Enforcement Directive that provide a “counterweight” to the qualified rights that rights holders have under the directive to obtain interim relief when seeking to enforce their patents against alleged infringers. Those safeguards include a time limit on instituting legal proceedings after interim relief is obtained, and a requirement to lodge an adequate security payable to the alleged infringer by way of compensating them for the prejudice suffered by the impact of interim relief imposed against them should they subsequently win the case at trial. They also include a power given to the courts to impose further damages. According to Holtorf, the ruling will prompt even more patent owners to try to obtain preliminary injunctions in Germany now, despite the existence of such safeguards.

Emmanuel Gougé, Paris-based patent expert at Pinsent Masons, said: “This ruling of the CJEU is also interesting in light of the Unified Patent Court and the conditions required by it for the grant of preliminary injunctions, as the UPC will also have to comply with EU law.”  

The UPC is being set up to provide a dedicated judicial system for litigating European patents, with or without unitary effect, with a transitional period during which existing European patents that are not specifically opted-out of the UPC’s jurisdiction will also be subject to the new court system. The UPC has entered its final preparatory steps and is expected to open in 2023.