Mikkel Lassen Ellingsen May 17 2021 Patent litigation: FAQs Bryn Aarflot AS | Intellectual Property - Norway Mikkel Lassen Ellingsen Intellectual Property What is the legal framework for patent litigation in Norway?What central agencies exist under Norwegian patent legislation?How far will the courts go in their review of administrative decisions?In what venue and format must patent litigation take place in Norway?How does the process of appeal work in Norway?Are there alternatives to litigation through the ordinary courts?Can parties claim compensation and damages under Norwegian patent legislation?How is economic compensation calculated under Norwegian patent legislation?This article is part of a series on patents in Norway.(1)What is the legal framework for patent litigation in Norway?The Patent Act(2) constitutes the basic legislative framework regarding patents and their extent under Norwegian law. The Patent Act regulates the registration, administrative opposition, cancellation and invalidation of patents as well as the regular material terms for patentability.Although not a member of the European Union, Norway remains internationally obliged to follow the rules of the European Patent Convention (EPC) by way of Protocol 28 of the European Economic Area agreement. Accordingly, the Patent Act may generally be viewed as being conforming to the EPC.What central agencies exist under Norwegian patent legislation?The Norwegian Industrial Property Office (NIPO) (known as 'patentstyret' in Norwegian) handles all of the aforementioned administrative procedures, subject to the regulations of the Patent Act. Naturally, NIPO administrative decisions are not final. The independent IP Appeal Board (KFIR) handles appeals on NIPO decisions.Further, KFIR decisions may be appealed to the regular court system if the necessary set of requirements are met. The legal basis for the format of such court proceedings is the Dispute Act.(3) Formally, the KFIR will meet as the counterpart in the court proceedings, as it is the KFIR decision that is the object of the appeal, as opposed the counterpart involved in the administrative process before the KFIR.How far will the courts go in their review of administrative decisions?Although statutory regulations state that the courts may rule on all aspects of KFIR decisions, they should – at least in theory – show restraint regarding certain complex and technical aspects where they lack the technical expertise and experience of the NIPO and the KFIR (see Swingball (Norsk Retstidende 1937 page 603) and Biomar (Norsk Retstidende 2008 page 555)). However, in practice, it can be argued that the courts generally retry even the complex, technical aspects in depth, often deviating from established case law by referring to the fact that the matter may be subject to a more comprehensive review before the courts than the administrative instances.In addition to its role as a court of appeal for administrative decisions, the Oslo City Court remains the compulsory legal venue for civil patent claims brought directly before the regular courts. Such claims include:infringement claims;injunctions; andclaims for damages.Naturally, the Dispute Act also applies in these cases.In what venue and format must patent litigation take place in Norway?Under Norwegian IP law, the Oslo City Court is the compulsory first-instance court for most IP matters as it has exclusive jurisdiction. This exclusivity also applies to appeals from the KFIR.Although the Oslo City Court hears all cases – regarding both civil and criminal matters – and for that reason is not specialised in IP law, each department within the court employs one judge with in-depth IP training. Generally, civil procedures are heard by only one judge, although expert judges may be brought in to hear comprehensive and complex cases, which is often the case for patents.How does the process of appeal work in Norway?An Oslo City Court decision may be appealed to the Court of Appeal (known as 'lagmannsretten' in Norwegian). The process will generally be similar to that before the Oslo City Court, but the panel of judges is increased to three regular judges. In addition to the regular judges, one or two expert judges may be appointed for complex cases (many patent cases are complex). The Court of Appeal may allow new evidence. The procedure is therefore not limited to a mere review, but rather a more complete procedure.A Court of Appeal decision may be appealed to the Supreme Court. However, the Supreme Court need not review all cases put before it – only a few cases which hold inherent principal value will generally be allowed for full review. However, statistically speaking, IP cases are more likely to be admitted to the Supreme Court than most other matters.Are there alternatives to litigation through the ordinary courts?Court mediationThe ordinary courts must continuously encourage mediation and dialogue between parties to patent disputes and will always aim for an amicable settlement through court mediation. However, the parties remain free to oppose such mediation should they find it superfluous or impossible under the circumstances.Settlement through court mediation is fundamentally different from proceedings before the different municipal conciliation boards as IP matters remain excluded from their jurisdiction, subject to Section 6(2) of the Dispute Act.ArbitrationArbitration is a highly viable format for resolving disputes under Norwegian law. Subject to the Arbitration Act,(4) arbitration may be a way for parties to resolve an ongoing dispute. Arbitration, in practice, is a rarely used option for IP disputes in Norway. While there may be several reasons for this, an efficient and relatively low-cost process before the regular court system remains influential.An arbitration agreement may entail either a permanent institutional arbitration clause or an ad hoc arbitration for a select dispute. In contrast to foreign arbitration regimes, ad hoc arbitration is the most popular form in Norway. Institutional arbitration is rare.Can parties claim compensation and damages under Norwegian patent legislation?The Patent Act may leave a party responsible for a patent infringement liable to several outcomes from court proceedings. Although strict penal sanctions are a legal possibility, economic compensation remains the most practical outcome. Generally, only the patentee may claim compensation. However, licensees may be eligible to claim compensation subject to further requirements.How is economic compensation calculated under Norwegian patent legislation?The Patent Act determines that patentees have multiple options when calculating compensation from an infringing party. Compensation may also be claimed from accomplices.Alternatively, patentees may claim:compensation which amounts to a fair licensing fee for the infringement, with the addition of damages suffered by the infringement which would not be suffered through licensing;damages which originated from the infringement; orcompensation which amounts to the financial gain which originated from the infringement.If the infringement is a result of either gross negligence or intent, the estimate of a fair licensing fee may be doubled. No such rule exists for damages. Norwegian patent legislation does not allow for punitive damages.The calculation of a fair licensing fee will vary considerably. Older case law indicates that a fair licensing fee may be between approximately 3% and 5% of gross annual turnover. However, up to 25% may apply to high-tech industries. This amount was granted in LB-2003-9824, which involved a producer of pharmaceuticals.For genuine infringement, patentees may not claim damages and must resort to claiming a fair licensing fee to the extent found to be reasonable.Norwegian courts will generally award the winning party its full, reasonable legal costs.For further information on this topic please contact Mikkel Lassen Ellingsen at Bryn Aarflot by telephone (+47 46 90 30 00) or email ([email protected]). The Bryn Aarflot website can be accessed at baa.no.Hallvard Sund, intern, assisted in the preparation of this article.Endnotes(1) For the first article in the series, please see "Patent prosecution: FAQs".(2) The Act relating to Patents (patentloven) (15 December 1967/9).(3) The Act relating to Mediation and Procedure in Civil Disputes (tvisteloven) (17 June 2005/90).(4) The Act relating to Arbitration (voldgiftsloven).