The Court That Never Was: How Brexit Roiled the World of Patents

(Bloomberg) --

On the third floor of a glass skyscraper in London’s Aldgate district, a suite of rooms sit waiting to be used by a new European court 50 years in the making.

But the patent court emblem on the wall will have to come down. In a sign of how Prime Minister Boris Johnson is determined to limit the reaches of the European Union after Brexit, the government withdrew from the project last week. Taking part would have meant Britain ceding a little power to the European Court of Justice -- whose clutches Johnson wants to escape.

The Unified Patent Court was supposed to be the answer to a decades-long quest for a pan-European court that could resolve patent disputes in one place. It had a number of false starts before 25 EU member states finally backed it in 2013. The U.K. was a key supporter and contributed a large portion of the funds for the project.

The Court That Never Was: How Brexit Roiled the World of Patents

“The UPC appears to be an early casualty of the government’s hardening stance on issues of U.K. sovereignty,” said Tim Powell, an intellectual property lawyer at Powell Gilbert in London. “It’s a small indication of a wider theme that I’m sure we will see play out over the next few months.”

The London branch of the court would have been responsible for cases relating to chemistry, including pharmaceuticals and the life sciences. Five other venues throughout Europe were going to handle disputes in other areas.

The court isn’t the only institution to be roiled by Brexit. The EU’s European Medicines Agency left the U.K. last year and set up a new base in Amsterdam. On Monday, Downing Street signaled its intent to withdraw from the EU’s pandemic warning system in 2021, despite the coronavirus outbreak, saying it wanted to escape the jurisdiction of the ECJ.

In a statement, the government said it will no longer participate in the court because it is “inconsistent with our aims of becoming an independent self-governing nation.” The head of secretariat for the new EU court system didn’t respond to emails seeking comment.

Brexit in itself wouldn’t have excluded the U.K. from the project. Long after the 2016 referendum, government ministers, including Johnson’s own brother, had given assurances that Britain would continue to take part, according to lawyers. The announcement of Britain’s withdrawal blindsided many, even those involved in setting it up.

“It’s a retrograde step for a government that says it’s focused on promoting science,” said Kevin Mooney, an intellectual property lawyer at Simmons & Simmons, who was heading up the U.K. effort and found out about the decision a day in advance. “The court is good for industry, it’s good for science.”

The withdrawal will mean U.K. companies, particularly those in the pharmaceutical industry regularly involved in disputes over drug patents, will be forced to continue to fight multiple suits in parallel across jurisdictions. Italy or the Netherlands are the most likely countries to take over the U.K.’s role in the system, lawyers said.

“After decades of trying to make a truly European patent court happen, many people in industry will be feeling frustrated,” said Jon Turnbull, a London patent lawyer at Herbert Smith Freehills.

©2020 Bloomberg L.P.

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