Trademarks in Spain: a step by step by guide

ELZABURU partners Luis Baz and Fernando Ilardia offer a complete and easy to follow guide about trademark registration in Spain: how to apply for your trademark, refusals, oppositions and so on

Spanish chapter

Reproduced with permission from Global Legal Group (published in May 2017)

The patent act has died. Long live the Patent Act!

The 1986 Spanish Patent Act has died of natural causes in Madrid, aged 31. Its successor, Law 24/2015, saw the light of day on Saturday 1 April, after a 21-month gestation period, thanks to the publication of its Implementing Regulation in the Official State Journal right on the deadline that had been established to that end. The SPTO’s enormous effort to take the Regulation forward paid off in extremis, guaranteeing safe delivery. 

We are now up against a new grant procedure, a new judicial system, new challenges and strategies, as well as new unknowns. This is something that we lawyers have been well accustomed to since 1986 –precisely when the Act to which we are now bidding a nostalgic farewell came into force-, when the profound transformation of Spanish industrial and intellectual property legislation got underway. 

In times of change, let us recall what the current Nobel Prize in Literature winner, Bob Dylan, had sung in his classic “Forever Young”: “may you have a strong foundation when the winds of changes shift”. Long live the new Patent Act and good luck to everyone.

N.B. For a more detailed explanation of Law 24/2015, please check here our posts published in 2015 and 2016.

Author: Antonio Castán

Visit our website: http://www.elzaburu.es/en

Licensing in Spain:

ELZABURU Partner Javier Fernández-Lasquetty together with lawyers Alba López and Martín Bello answer the key questions of concern to corporations and their counsel when dealing with licensing laws in Spain. Areas covered include: kinds of licences, law affecting international licensing, intellectual property issues, software licensing, royalties and other payments, currency conversion and taxes, competition law issues, indemnification, disclaimers of liability, damages and limitation of damages, termination of licensing agreements, bankruptcy, governing law and dispute resolution.

Spanish chapter

Reproduced with permission from Law Business Research Ltd. Getting the Deal Through: Licensing 2017, (published in February 2017; contributing editor: Bruno Floriani, Lapointe Rosenstein Marchand Melançon LLP) For further information please visit https://gettingthedealthrough.com/area/19/licensing/

Mercantile courts make a move

The Official State Gazette for the penultimate day of the year came out with a surprise in the form of the publication of a decision whereby the National Judicial Council has designated specialized courts to hear IP related lawsuits in the following autonomous communities:

  

Community	Designated courts
Catalonia	Barcelona Mercantile Courts Nos. 1, 4 and 5: patents and industrial designs Barcelona Mercantile Courts Nos. 2, 6, 8 and 9: trademarks
Madrid	Madrid Mercantile Courts Nos. 7, 8, 9 and 10
Valencia	Valencia Mercantile Court No. 2: patents Valencia Mercantile Courts Nos. 1 and 3: trademarks and industrial designs

The decision has been prompted by the risk (relative though it may be), perceived upon the promulgation of the new Law 24/2015 on Patents, that lawsuits in the IP field could migrate to Barcelona. It will take effect from April 2017, which is when that new law comes into force.

It remains to be seen whether, since the geographical scope of the specialization remains limited, legal actions are going to be concentrated in    Madrid, Barcelona and Valencia (together with Alicante) to the exclusion of other autonomous communities. However, that is another story. For the moment, the decision of the National Judicial Council may be received with relief and applause.

Author: Antonio Castán

Visit our website: http://www.elzaburu.es/en 

Elzaburu once again ranked among Spain’s most highly reputed law firms

In 2015 the firm registered a turnover of over 14 million euros for yet another year.

Madrid, 1 June 2016. Elzaburu once again figures among the most prestigious law firms in Spain according to the ranking published annually by the economic and business daily Expansión. A turnover of 14 million euros positions it among the country’s 20 top rated firms.

At the same time the firm has pursued its enlargement plans, increasing the number of lawyers on its staff by 14.3%. Elzaburu is thus among the 25 firms headquartered in Spain which most strengthened their workforce in 2015.

Elzaburu ranks fourteenth in terms of invoicing per practitioner with a figure of 235,000 euros. This is significantly higher than the average in Spain, which in 2015 was 190,887 euros per practitioner. In terms of invoicing purely by lawyer, Elzaburu moves up to tenth place on the ranking.

Year on year, experience and professionalism have proved to be the twin pillars of the firm, ensuring Elzaburu a place among the best in Spain.

Utility models under the new Patent Act: chemicals and can openers in the same bag for the first time (V)

One of the most striking features of the new Patent Act is the extension of the scope of what may be protected as a utility model. The new definition of utility models provided in the law includes the word “composition”, thus broadening the range so as to take in practically any product or composition, including chemical preparations or substances. At the same time, however, it is stipulated that inventions relating to biological material or pharmaceutical substances and compositions are excluded.

This new facet of utility models may well give rise to some controversy in the future, given that, on the one hand, the boundaries between the products which qualify for protection in this form and those which do not are unclear in some cases  and, on the other, to set the inventive step requirement at a level suitably lower than that applicable to patents could prove problematic when the invention relates to a chemical product (as it in fact already is in the case of inventions of a mechanical nature).

So from now on we shall have to become accustomed to seeing small mechanical inventions, such as can openers, which have traditionally been the subject matter of this form of industrial property, appear side by side in the Official Gazette with chemical products, when applicants opt for this manner of protection for these.

Not all the changes are so controversial, however. For example, the relative novelty requirement, confined to Spain alone, will no longer apply and utility models will therefore be on the same footing as patents with respect to the state of the art. This means that it will be easier to determine clearly which documents may constitute prior art for the purpose of assessing the novelty and inventive step of a utility model and we may therefore see an end to the uncertainty which had existed under the former Patent Act.

Another significant development to be introduced under the new Law lies in the possibility of requesting reports on the state of the art, containing a written opinion, for utility models. These reports will be necessary for the effective enforcement of the exclusive rights obtained through registration (for example, in infringement proceedings brought against a third party).

The grant procedure does not undergo any major amendment, although with respect to opposition proceedings it is to be noted that under the new Law it will be possible to request a two-month extension of time to complete an opposition by submitting evidence and supplementing the initial arguments. Another new (and undoubtedly positive) feature is that the examination of oppositions will be conducted by a panel of three technically qualified SPTO experts and, as the case may be, of a lawyer.

So how does the future look for utility models in Spain? The extension of their scope to chemical products, the possibility of claiming an internal priority and the fact that substantive examination is to become obligatory for patents may well prompt more applicants to protect their inventions as utility models, thus reversing the downtrend observed in recent years.

It would certainly appear, at all events, that a window is going to be open to different interpretations of some aspects of the new system on the part of applicants, agents, examiners and judges and it remains to be seen how they will be resolved in the future.

Blog entries dealing with the new Patent Act:

I. A new Patent Act … In two years'time? (Antonio Castán)

II. 180º turn in Spain's system of granting patents  (Francisco J. Sáez)

III. The importance of professional advice (Francisco J. Sáez)

IV. Lawsuits under the new Patent Act (Antonio Castán)

V. Utility models under the new Patent Act (Pedro Saturio)

Author: Pedro Saturio

Visit our website: http://www.elzaburu.es/en

The Spanish Supreme Court applies CJEU doctrine in respect of use of third parties’ trademarks as search engine keywords

Judgment 105/2016, rendered by the Civil Chamber of the Spanish Supreme Court on 29 February, establishes the criteria pursuant to which the use of a third-party trademark as a search engine keyword must be examined in order to determine whether it infringes the trademark holder’s exclusive rights.     

To that end, the Supreme Court has followed in the footsteps of Alicante Court of Appeal and applied the doctrine established by the Court of Justice of the European Union in its judgments of 23 March 2010 (joined cases C-236/08 -Google France v Louis Vuitton-, C-237/08 -Google France v Viaticum- and C-238/08 - Google France v Centre National de Recherche en Relations Humaines), 12 July 2011 (C-324/09, L'Oréal SA v eBay International AG) and 22 September 2011 (C-323/09, Interflora Inc. v Marks & Spencer plc).

According to that doctrine, the use of third parties’ trademarks as keywords in principle infringes the trademark holder’s rights.  Nevertheless, since exclusive trademark rights are not absolute, under certain circumstances such use will not be considered as infringing.  Those circumstances are as follows: 

i) where the use of the trademark is not liable to affect the ‘product origin indicating’, advertising or investment functions of the trademark; and 
ii) where it is clear to the average Internet user that the goods or services advertised do not come from the trademark holder or from an undertaking economically connected to it.              

Lawsuits under the new Patent Act, a rara avis on the Spanish judicial scene (IV)

Since the reform of patent law in Spain under the Act of 1986, lawsuits in this field have always been different, given the host of specialties they entail, and it is no exaggeration to say that when the new Law 24/2015 enters into force they could come to be considered a veritable rara avis within our judicial system. The singularities which that new Act ushers in are so many and so far-reaching that any resemblance to other legal actions will from then on be attributable solely to coincidence.

On the one hand, a curious aspect of the changes we may expect to witness is that from 1 April 2017 lawsuits in the field of intellectual property, with the exception of those based on Community trademarks or designs, may tend to migrate towards Barcelona. Under the new Act, jurisdiction lies with the mercantile courts of the cities which are seats of the High Court of Justice, but only within those autonomous communities where the National Judicial Council has designated specific mercantile courts to specialize in patent matters. Although the Madrid mercantile courts have realized the implications of this and are consequently on the way to obtaining that designation, only Barcelona has courts that so far qualify. It is not unlikely that the decision to introduce this requirement was to some extent influenced by the positive image associated with the hyper-specialization trend in Catalonia. Be that as it may, the change is significant.

Second, intellectual property lawsuits are going to spark off no little envy within the legal profession due to a factor which might appear incidental but in practice has considerable importance: the time limit for responding to the complaint in any civil action regulated by Law 24/2015 will be two months, whereas in any other field it is only twenty days. This significant, and admittedly rather preferential, extension of the standard term may be justified in view of the technical issues underlying disputes in this area and the need to resolve strategic questions bearing on the challenge to the property right.

Then there is a third factor which sets patent law proceedings apart from any others: the creation of nothing less than an instrument for relief against interlocutory relief. Under the new Act it will be possible for those who envisage that the court may be asked to grant interim relief against them, without their first being heard, to put forward, through a “preventive submission”, arguments against the adoption thereof. It is not yet known whether this arrangement, so foreign to traditional procedure in Spain, will have the effect of a brake or of a piston, as in the way it is designed it could generate conflicts where they did not previously exist or instead put out the fire before the flame has time to take hold. Once again, we are faced with innovative provisions which have no equivalent in any other area of law.

This special configuration of the patent lawsuit takes on yet more importance when we consider that the procedural provisions of Law 24/2015 also apply to trademarks and designs. In this regard one may ask up to what point some actions in the area of trademark law, such as revocation for non-use, really deserve to be included in so exceptional a system.

As we shall be seeing in future chapters, the changes we have outlined above are not the only ones which allow lawsuits in this field to be termed a rara avis.

Blog entries dealing with the new Patent Act:

I. A new Patent Act … In two years'time? (Antonio Castán)

II. 180º turn in Spain's system of granting patents  (Francisco J. Sáez)

III. The importance of professional advice (Francisco J. Sáez)
IV. Lawsuits under the new Patent Act (Antonio Castán)
V. Utility models under the new Patent Act (Pedro Saturio)

Author: Antonio Castán

Visit our website: http://www.elzaburu.es/en

The new Patent Act (III) – The importance of professional advice

The new Patent Act, Act No. 24/2015, set to take effect on 1 April 2017, provides for far-reaching changes in the procedure for obtaining patents of invention in Spain in the future but at the same time ushers in new demands as well.

Earlier blog entries have dealt with the patentability requirements and the mandatory examination for all new applications filed after the new Patent Act and its Implementing Regulations have come into force. This means that applicants who up to now have made use of the general procedure for grant and hence are not used to replying to communications from the Spanish Patent Office raising objections to the patentability of their applications can expect to encounter new stumbling blocks to overcome during patent prosecution. Here are just a few examples of some of the substantive changes:

  

• To begin with, Examiners will now be able to object that lack of clarity of the claims prevents him or her from carrying out a meaningful search of the prior art.

• Further, applicants will need to bear in mind that the patentability of an invention can be vitiated by European patent applications designating Spain and published in Spanish and by PCT applications that have entered the national phase in Spain and were filed before the priority date of the application even if only published afterwards. Should this situation arise, it will bear on the novelty requirement but not on the inventive step requirement.

• In addition, where an invention relates to either biological material, either animal or vegetable, the new Act requires the application to disclose the geographical origin or source, though that information will not prejudice the validity of the patent. 

• The new Patent Act will also expressly define substances and compositions "for use as medicines" as patentable, something not contemplated under the Patent Act (Act No. 11/1986) currently in force. 

• In an important new development regarding utility models, the novelty requirement will change from local (Spain only) to absolute (worldwide) novelty. In addition, utility models will be able to be used to protect not only mechanical devices but also chemical, though not pharmaceutical, substances and compositions.

• And finally, the patentability requirements (novelty, inventive step, and industrial applicability) and how they are assessed by the SPTO will be new concerns for some applicants with a view to responding convincingly and appropriately to objections by Examiners and thus avoiding additional objections – for instance, on grounds of lack of clarity.

What is more, the changes being implemented by the Patent Act address not just substantive matters but also a number of other significant aspects of patent prosecution. To mention only a few of the most important: 

• The new Act stipulates that the fee for the Report on the State of the Art (search report) will have to be paid along with the filing fee. 

• Applicants will have three months from publication of the search report to request the substantive examination. Absent a timely request for examination, or if the request is withdrawn, the application too will be deemed to have been abandoned. When requesting the examination, an applicant may, at the same time, respond to any objections raised in the SPTO's Examiner's written opinion issued with the search report. 

• There will no longer be only one chance to overcome any deficiencies noted by the Examiner before the reasoned opinion, and Examiners will have to allow applicants additional opportunities to amend the application and submit new arguments under a procedure to be specified in the Implementing Regulations. All amendments will have to include an explanation as to why they make a difference, and support for the amendments in the application as originally filed will have to be shown. If there is no response to the Examiner's communications, or if the applicant is unable to overcome the objections, the application will be refused. 

• Third-party opposition proceedings will now take place after grant, within six months of the date of grant, instead of prior to grant as provided under the current Act. There will be new administrative procedures to enable applicants to voluntarily limit and surrender patents, where appropriate.

So it is that upon entry into force of the new Patent Act, applicants seeking patents of invention in Spain will encounter a completely new scenario, with many substantive and procedural changes. This highlights the need for top professional assistance with a view to optimizing your industrial property assets by minimizing the stumbling blocks that can be anticipated during patent prosecution.

Blog entries dealing with the new Patent Act:

I. A new Patent Act … In two years'time? (Antonio Castán)

II. 180º turn in Spain's system of granting patents  (Francisco J. Sáez)

III. The importance of professional advice (Francisco J. Sáez)
IV. Lawsuits under the new Patent Act (Antonio Castán)
V. Utility models under the new Patent Act (Pedro Saturio)

Author: Francisco Javier Sáez

Visit our website: http://www.elzaburu.es/en

Reduction of the statute of limitations for Spanish actions

Up till now Spanish plaintiffs benefitted from a more than generous fifteen year general statute of limitations for most actions in personam. In a major reform of the Spanish Civil Procedure Act and the Civil Code which entered into force last Wednesday, October 7, this has now been reduced to five years.

    

This affects many of the most common contract based actions such as breach, non-payment, supply of defective goods, rent review and all claims relating to a contract of sale. The new legislation seeks to strike a better balance between the creditor’s interest in preserving his claim and the need to ensure that there is a reasonable time-limit. Fifteen years was held by most operators to be excessive.  The system has now been brought into line with that of other European countries which have a five year limit.     

With a previous time limit of fifteen years, transitional provisions are obviously of great importance. As one might expect, the new limit will only apply to obligations arising after the entry into force of the reform. Those arising prior to 7 October 2000 are already statute-barred due to the expiry of the old fifteen year limit. Those arising between that date and 7 October 2005 remain subject to the old limit. Those arising after that date and before 7 October 2015 will be statute-barred on 7 October 2020, i.e. they will be given the benefit of five years from the date of entry. Thus an obligation arising on 7 October 2010 will now be barred in 2020 and not in 2025, a full five years earlier.

In view of the above, clients are advised to urgently review any outstanding claims arising after 7 October 2000. We remain at your disposal should you require any further information with respect to the above. 

Author: Alba Mª López

Visit our website: http://www.elzaburu.es/en

180º turn in Spain's system of granting patents (II)

The different stages in the prosecution of Spanish patent applications have up to now started with an initial examination as to certain formal aspects along with certain technical features and clarity of the invention as claimed, followed by a search of the potentially anticipatory prior art preceding the filing date of the application, which is carried out by the Spanish Patent Examiner.

Spain's current Patent Act already prescribes that to be patentable an invention should be new and inventive (i.e., non-obvious) over all the prior art available up to the application's priority date.

This prior art search, called, in English translation, the "report on the state of the art", encompasses all documents disclosed by the Spanish Examiner which, in his or her opinion, could pose an obstacle to the patentability of the invention as claimed, either by reason of lack of novelty or because the invention is obvious in view of the prior art.

Paradoxically, however, as things currently stand, unless the applicant specifically requests the Patent Office to carry out an optional patentability examination, the application will automatically proceed to grant even if the Spanish Examiner has misgivings about an invention's patentability or, indeed, directly finds the invention to be unpatentable.

The resulting patent will, of course, be at risk of possible nullity proceedings in the Spanish courts at the request of any interested third party, and if the court agrees with the Examiner's opinion, the patent will most likely be ruled to be null and void, i.e., never to have had effect at all. This entails costs for the applicant, for third parties, and for society as a whole, and this situation could be mitigated if patents were granted only if they successfully passed a substantive patentability examination by the Spanish Patent Office, currently only optional.

Requesting a patentability examination was introduced as an option for Spanish patent applications in the early 2000's in the hope that it would gradually become common for applicants to request examination, particularly where the search report had been negative, in an endeavour to persuade the Examiner to reconsider the initially adverse opinion. Things have not, however, gone as intended, and today the patentability examination is requested for fewer than 10 % of patent applications, even where the search report is unambiguously unfavourable. This means that the validity of more than 90 % of the patents currently in force is potentially suspect.

A new Patent Act … In two years' time? (I)

Publication this summer of the new Patent Act, Act no. 24/2015 (in Spanish) of 24 July 2015, in the Official State Gazette (BOE) has resulted in the appearance of a flurry of urgent commentary and reviews in a wide range of different media outlets. This reaction comes as a bit of a surprise: while all law reform is newsworthy, what we have in this case is an Act that will not come into force until … 1 April 2017!!

This unusually protracted vacatio legis (22 months) highlights the far-reaching scope of the revision while at the same time likewise attesting to prudence on the part of lawmakers.

Not only will industry need some time to adapt, because certain changes (e.g., the change-over to a single system for grant involving the preliminary examination of all patent applications) will require major adjustments to current thinking and practice, but implementing the changes will require the Administration to undertake its own re-organization, with no room for improvisation.

For once the government is to be commended for not rushing headlong to put a law on the statute books when enforcement will hinge on a particularly arduous process of setting up the requisite implementing regulations. The painful examples of other, premature reform attempts (copyright, for instance?) are still with us.

The delay, amply justified as it is for the broad sweep of administrative adjustments needed by the Patent Office, is more vexing when it comes to other areas. As it evolved, the new Patent Act came to contain more and more changes bearing on legal proceedings and procedure. In the end, unexpectedly, the Act ushers in a whole aggiornamento addressing patent litigation proceedings (with collateral effects extending to other types of industrial property), so it will be bound to resonate. It is indeed unfortunate that we will be kept on tenterhooks for so long awaiting the tantalizing prospects for legal proceedings that the Act holds out to us.

ELZABURU will be reviewing and assessing the new Act in a series of posts that will be appearing on our blog in the coming weeks for our clients, colleagues, and friends. Until then, we can look forward with expectation to this new Act, that will be so long in coming, like a long-awaited dish of a favourite food.

Blog entries dealing with the new Patent Act:

I. A new Patent Act … In two years' time? (Antonio Castán)

II. 180º turn in Spain's system of granting patents  (Francisco J. Sáez)

III. The importance of professional advice (Francisco J. Sáez)

IV. Lawsuits under the new Patent Act (Antonio Castán)
V. Utility models under the new Patent Act (Pedro Saturio)

Author: Antonio Castán

Visit our website: http://www.elzaburu.es/en

Revisions to the Patent Act: a necessary step to foment inventing in Spain

Nearly 30 years after passage of the current Patent Act, the legislation currently in force plainly stands in need of revision to bring it up to date with the advances made by society since that time. With this in mind, the Spanish Patent and Trademark Office (SPTO) has proposed a revised Patent Act, and a second draft of the proposed bill (in Spanish) was published this past month of December.

Lately, one of the most controversial aspects of the current system is what is known as the alternate route to grant, where the applicant may choose between the traditional granting procedure, in which all patent applications mature to grant, and the granting procedure involving preliminary examination, in which SPTO examiners examine the patent application, which will be granted only if the invention as claimed is deemed to fulfil the requirements of novelty, inventive step (non-obviousness), and industrial applicability. Unfortunately, this latter granting procedure has never taken hold, and today just 8 % of applications follow the route involving examination of the application. This shifts the burden of having to cancel patents that should never have been granted onto society, competitors, and the courts.

This is probably the main change in the draft bill, and from enactment substantive examination of patent applications will be mandatory, so that patents will only be granted where the invention claimed fulfils the legal patentability requirements.

Still, it is by no means the only change included in the new draft bill, which would put in place quite a few new provisions intended to have far-reaching effects on patent law by streamlining the system, simplifying requirements, doing away with formalities, and avoiding involuntary loss of rights.

Some of the most important of these changes are:

1. Simplifying the requirements for according a filing date by allowing first filings to be made in any language, though subsequently filing a Spanish translation would be compulsory.
2. Bringing forward the prior art search to the filing stage, hence the search fee will have to be paid at the time of filing.
3. Explicitly declaring medical uses or new therapeutic applications of known substances to be patentable.
4. Shifting the opposition stage to after grant.
5. Implementing new administrative procedures for revoking patents and for limiting them at the request of the patent holder, who will be entitled to limit the scope of the claims at any time during the legal lifetime of a patent.

Patents are not the only rights to be slated for significant changes: amendments are also being proposed for utility models, a mainstay of small and medium sized enterprises (SMEs) in Spain.

The novelty requirement for utility models is to be brought into line with the novelty requirement for patents, thereby removing a source of uncertainty in existing law. Conversely, the degree of inventive step will not be changed and will continue to be lower than required for patents. At the same time, the range of inventions that can be protected as utility models will be enlarged to include chemical substances, biotechnology inventions and pharmaceutical compositions excluded.

These changes could make utility models into an interesting option as, for instance, a means of obtaining rapid protection while a patent is being prosecuted more slowly.

And lastly turning to fees, the draft bill also provides for a 50-% reduction in the filing, search, and examination fees for certain inventors and SMEs, to make it easier for them to protect their inventions.

In short, the changes are intended to bring the patent system up to date and should be a step forward in providing protection for innovation in Spain.

Author: Francisco J. Saez

Visit our website: http://www.elzaburu.es/

Good news for forgetful applicants in Spain

Spanish Patent and Trademark Office
By Ricardo Ricote
(Via Flickr)

Article 33.3 of the Spanish Patent Act is very clear. If you do not request the search report in the 15 months following the patent application, it will be deemed to be withdrawn.

However in a breakthrough decision the Madrid High Court has now ordered the Spanish PTO to resume prosecution of a patent application which protects an innovative test for detecting the presence of certain viruses in the body. The applicant argued that Article 76.3 of the Administrative Procedure Act, which governs all applications to government offices, should prevail as it was passed by Parliament four years after the 1986 Patent Act. The Administrative Procedure Act treats the citizen much more benevolently, allowing him to remedy the defect even though the time limit for doing so has expired. In fact, he can remedy it at any time up to and including the day the public office notifies him of the expiration of the time limit. In the case of the search report, this will be the day on which the withdrawal of the application is published in the Official Gazette of the SPTO. The applicant may request the search report and pay the fee that same day.

This judgment (no. 77/2014 of 29 January 2014 in appeal no. 458/2011) breaks with the practice of the Spanish PTO. It has enormous implications as the same reasoning is applicable to any occasion on which an applicant for a patent, trademark or industrial design fails to comply with a step in the procedure, for instance if he forgets to pay the annuity fee.  

Author:Colm Ahern

Visit our website: http://www.elzaburu.es/

Is proof of damages required in Spain if patentee opts for equivalent royalty?

Article 13 of the Enforcement Directive 2004/48/CE rather confusingly seems to equate equivalent royalty with damages, whereas in many continental legal systems it might fit more easily into the category of unjust enrichment i.e. the infringer has obtained something to which he has no legitimate right. 

The reference to damages, which has been transposed in Article 66 of the Patents Act has caused particular problems in Spain where case law has traditionally held that damages must be “real and effective” and strictly limited to those that are proven. Should the patentee then have to prove damages if he opts for equivalent royalty which, after all, has nothing to do with any actual damage he has suffered? This has led to some rather confusing and contradictory case law and the development of the doctrine of “ex re ipsa” which seeks to somehow fit equivalent royalty into the traditional picture by saying that there is no need to prove the existence of damage if by the nature of the thing under analysis (res), the existence of damage is clear (from the thing itself). However it would have been much better to acknowledge that as equivalent royalty cannot really be equated with the continental law concept of damages, as then the question of proving damages does not even arise.

This is exactly what the Madrid Appeal Court has done in Judgment no. 25/2014 of 24 January 2014 in appeal no. 578/2012. The ruling sets out that the purpose of equivalent royalty is not to compensate a loss suffered by the patentee, but rather the illegitimate invasion of his exclusive right. The Court does not say that it is necessary to show that the existence of a loss is self-evident (ex re ipsa) but rather that there is no need to prove or even consider any such loss. This comes as good news to patentees who up to now ran the risk that a court might find that the loss was not as self evident as they claimed e.g. when the patentee himself is not exploiting the patent in Spain and has made no preparations to do so either directly or through the granting of licenses. Even better, the Court gives clear guidance on what type of equivalent license terms can be sought including an up front payment, a fixed minimum monthly royalty and variable royalty based on sales. This is good news for patent litigators in Spain where judges traditionally tend to be guarded in their damages awards.

Author:Colm Ahern

Visit our website: http://www.elzaburu.es/