Economy in Danger? The Failures of German Injunction Jurisprudence in Patent Litigation with Special Regard to Standard Essential Patents and Their Solution

Maximilian R. Herrie

4/30/2014
(Original Publish Date: 11/7/2012)

Differently from the majority of countries in the European Union and around the world, Germany’s patent laws and corresponding jurisdiction are known for being styled in a very pro-patentee manner. This can have significantly disadvantageous impact on defendants during patent infringement proceedings. Especially on the practically important preliminary stage an injunction can cause harsh economic effects - not only on the defendant but also on third parties and ultimately the public as a whole. And these effects are even aggravated in cases where standard-essential technologies are at issue as they are inevitably necessary for the defendant to compete in the market and design-arounds will often be impossible. Furthermore the monopolistic patent right often seems to be treated in a too strict, property-like manner and its economic value seems not to be used to the fully possible extent. The article is first concerned with analyzing the (legal) reasons for such economically ineffective treatment and exploitation of the patent right and the unbalanced treatment of the rights and parties involved. It then looks at the so-called “ebay-factors” governing injunctive relief in U.S. patent law. There, especially the fourth factor, which guarantees that the grant of an injunction serves the public interest, is found to be a helpful vehicle to include economic aspects regarding the patent user as well as public welfare as a whole. Then a patent-unrelated concept from EU competition law, namely the “more-economic-approach,” offering an efficiency excuse to defendants in competition law disputes is examined carefully. It is found that the idea of using a persuasively presented argument of efficiency as a defense for objectionable conduct is (including certain qualifications) well transferable to the institutions of injunctive relief in patent law and can thus facilitate a more efficient exploitation of the patent.