Getting Late Early: Tech, Transparency Problems Shake Confidence in UPC

Getting Late Early: Tech and Transparency Problems Shake Confidence in UPC

The newly launched Unified Patent Court (UPC), which took more than twenty years to launch amid myriad setbacks, was originally envisioned as a landmark institution in the European Union’s pursuit of a harmonized patent system.  If implemented properly and used widely, it could unify and simplify European proceedings, encourage adoption, and offer a reliable, robust mechanism for both invalidity and enforcement.

It has not.  Chronic technical problems, a confusing public/private docketing system, and early anti-transparency decisions have given filers pause.

While boosters and some law firms have been generally enthusiastic, early technological and transparency problems have slowed filings, shaken confidence, and cast a shadow over the UPC’s potential.  A confusing, opaque docket, a lack of instruction, and basic technological challenges combined with a lack of public disclosure have stymied adoption and kept most companies on the sidelines.  And while the UPC has recently taken some steps toward addressing these challenges, if they do not do more—fast—the forum will continue to lose credibility, as parties opt for more transparent, reliable processes in national courts.

The UPC need not look much further than other launches of new trials and procedures around the world to see what could be done differently.  In the United States, we revamped and rechristened the Patent Trial and Appeal Board (PTAB) procedures over a decade ago, under the same cloud of apprehension.  How would the proceedings go?  Would they be reliable, open, and clear?  Would technology help or hinder confidence in their use?

To say the technological rollout went well would be an understatement.  Regarding clarity, disclosure, and building user confidence, the PTAB rollout and related public relations efforts were exemplary, as openness of proceedings, the public reporting, and the general clarity of procedures led within mere months of launch to broad adoption.  When it launched, firms, companies, and stakeholders knew little about how it would play out, and many counselled a wait-and-see approach; within six months, reporting services, resources, firm practices, and even a few open, webcast hearings helped demystify it, instilling confidence in the procedures.  Many US local and Federal Courts have had similar experiences with systems, modernizing them to the point of ensuring access to justice, fairness, and public support.

In comparison, more than six months into the UPC, interest is falling short of early goals, information is scarce and conflicting, and even firms practicing before it cannot offer much clarity into how matters will be handled—or how much it might cost, and what might be at risk.  They cannot even advise you on how the docketing system will work, and whether decisions might be public.

But it is still not too late.  The UPC could move quickly to improve their electronic docketing and data systems, their user experience, and public relations efforts; they could hold open to journalists and the public at least model proceedings, demonstrating to the international world that the procedures are fair, efficient, certain; they could share even genericized filing data sets to offer a clearer picture of what exactly is going on; in short, they could right the ship before it’s too late.

But they must recognize that confidence in the new system is as important as the procedures themselves.  It will not matter if the Court is perfect in practice if no one is around to witness it.  “It is not merely of some importance but is of fundamental importance that justice should not only be done, but should manifestly and undoubtedly be seen to be done.”.” Rex v. Sussex Justices, Ex parte McCarthy [1924] 1 K.B. 256, 259 (Lord Hewart C.J.).

1. A Veil of Secrecy: Denying Access to the Public

Of note, UPC courts—generally closed to the public, not broadcast, and with mostly sealed filings—have denied petitions for access even to the few journalists and members of the public who can afford to fly to go to hearings.  In Astellas v. Osaka University, (UPC_CFI_75/2023), the UPC Munich Central Division took a very secretive, outdated view of Rule 262.1, denying access to non-confidential prior art evidence.  The same Judge-Rapporteur, Judge András Kupecz, repeated the ruling in Amgen, Inc. v. Sanofi-Aventis Deutschland GmbH (UPC_CFI_1/2023).  Both rulings go too far and set a high bar to the type of transparency expected of a powerful court of international jurisdiction.

Transparency is a cornerstone of any credible legal system, and open access to court proceedings is a fundamental part of this transparency; and in the modern world, if proceedings can’t be found and explained easily online, they remain a walled garden few will risk braving the walls of.  These decisions have cited the need to protect sensitive information, but they come from a German sensibility, where even the identity of the parties (early) and nearly the entire proceeding is held private.  While there may be some legitimate concerns for safeguarding the publication of truly confidential business data, there is no legitimate reason to keep such proceedings shrouded in secrecy when based on published information.  And while it is important to balance transparency and protection, the markets, investors, and the public have a right to know if a proceeding might have an outsized impact on the international economy, rather than to be blindsided by a largely secret proceeding.  Denying access to journalists and third parties, particularly this early in the young court’s life, also inadvertently raises questions about how fair the already opaque proceedings are; that lack of sunlight engenders concern.  In short, the UPC should either clarify or amend Rule 262.1, or otherwise have the Court of Appeals clarify a preference for publication and access to third parties, lest the 13 local divisions fall into a lack of transparency from the start.

2. A Difficult Docketing System

A useful and reliable electronic docketing system is essential in the digital age, where the international legal community relies on efficient and widely available tools to navigate complex cases.  But few would defend the UPC’s website and docketing system as a model of technological clarity.  It is dense, confusing, and not user-friendly, for either the public or the direct participants.  That extends even to the numbering—one practitioner with five matters had 30 docket numbers.  Others speak of it taking days to upload documents, of nagging technology issues that take months to resolve, and of issues with in-person hearings.  The easiest of these to fix, however, is to do away with the use of separate websites and then a public/private CMS tool.  The UPC should simply use the CMS tool and keep most documents public, and reduce the stringent requirements for parties to use separate physical keys and other unnecessary hurdles to access docketing systems.

An effective electronic docketing system should provide easy access to case information, deadlines, and relevant documents, as well as offer clear instructions on use, and avoid being a hindrance to the good administration of justice.  However, patent filers and legal professionals have expressed frustration over the system’s usability, layering unnecessary bureaucratic complexity on top of already-complex patent cases.  It is not simply a matter of convenience; it is significantly affecting the number and quality of filings.  A difficult system will be used less, and less effectively.

3. A General Lack of Examples and Information

Beyond the issues of access to hearings and electronic docketing, there is a broader lack of publicly available information about how trials are conducted within the UPC.  The Court’s procedures, precedents, and decision-making processes are shrouded in mystery or presented confusingly, making it difficult for even sophisticated international parties to understand the standards they might be judged against.  This lack of transparency can have a chilling effect on the willingness of stakeholders to engage with the UPC.

4. A Missed Opportunity for Encouraging Uptake

A transparent, explained, and accessible court could have been a catalyst for encouraging filings, consolidating disputes, and boosting innovation within Europe.  When inventors, companies, and investors perceive a system as open, fair, and predictable, they are more likely to engage with it.  This can stimulate economic growth and technological advancement.

This has clearly not happened, despite the lure of broader resolution of claims and the potential power of cross-border enforcement.  This has deprived the UPC of potential cases and is now starting to raise questions about the Court’s effectiveness.  You do not see industry leaders rushing to file; beyond a few isolated disputes, the lack of filings from Fortune 500 companies, European powerhouse companies, and others speaks volumes.  There is just no way to feel confident of what the procedures will look like, how much they will cost, what the risks will be, and if the juice will be worth the squeeze.

5. Ways Forward

To address these issues, several steps can be taken to enhance the transparency and accessibility of the UPC:

1. A Greater Need for Transparency: The UPC should develop clearer guidelines for balancing the protection of sensitive information with the need for transparency, and consider granting more access to hearings, filings, and model procedures. Journalists and the public should have reasonable access to court proceedings; the Court should consider public-facing speaking, writing, and training programs to address some of these shortcomings.

2. Improving the Electronic Docketing System: The odd requirement for a public-facing website and then a public/private CMS system gatekept by cumbersome tokens and third-party services is both inefficient and unnecessary. The UPC should invest heavily in modernizing its electronic docketing system, creating one system—the CMS system—and keeping documents for the most part available to the public without further bureaucratic hoops to jump through.  This includes modernizing website and data access as well as tech tools that enable the broadcasting and sharing of hearings.  US courts and government agencies do this routinely, down to the local level.  The UPC is no different.

3. Transparency Initiatives, Training, and Education: The Court should consider it their duty to proactively share information about—and examples of—procedures, decisions, and precedents. This can be achieved through the publication of non-sensitive case information and summaries.  The UPC should offer training webinars and other resources to help legal professionals effectively navigate its processes.

4. Feedback: The Court should encourage and respond to public and stakeholder criticism, continuing to develop transparent mechanisms for feedback, and let anyone highlight technological issues, procedural concerns, and improvements.

6. Conclusion

The Unified Patent Court has the potential to be a patent litigation game-changer.  It has not yet delivered.  It must address the pressing issues of transparency and use required in a modern world.  Uptake and perception are important to the Court’s collective success.  By striking the right balance between confidentiality and transparency, investing in user-friendly technology, and providing clear information about its operations, the UPC still has time to make sure it fulfills its potential.  It was decades in the making.  It must not waste this opportunity.