Procedure in patent enforcement and invalidity actions
In Sweden, essentially all patent-related disputes fall under the exclusive jurisdiction of the Patent and Market Court (PMC), which is a specialised IP court at Stockholm District Court. The PMC administers both litigation in civil disputes, such as infringement and validity cases, prosecution matters on appeal from the SIPO and criminal cases relating to IP infringement.
All licensees have standing to bring infringement proceedings. Anyone who is prejudiced by a patent has standing to bring revocation proceedings. However, if the revocation request is based on the patent being granted to someone who is not the inventor and who has not acquired his or her right to the invention from the inventor, standing is restricted to those who assert the right of ownership. There is a requirement for a litigation bond to be provided by foreign claimants, but many nationalities are exempt from this requirement.
There are pre-litigation notification requirements, of which a claimant must be aware. Anyone who intends to bring proceedings for the revocation of a patent must give the SIPO, and all parties recorded in the patent register as licensees and pledge holders in respect of the patent, notice of the intention to do so. A licensee who wishes to initiate infringement proceedings must first notify the patentee. Failure to comply with a notification requirement bars the proceedings from progressing but the court will give the claimant the opportunity to remedy any omission in this respect. It is common practice to send a warning letter before bringing proceedings. Warning letters can in very particular circumstances give rise to liability under marketing law but the premise is that such letters are a natural element of a dispute.
Both infringement and revocation proceedings are initiated by the filing of a summons application. A summons application must, among other things, specify the relief that the claimant seeks from the court. The requirement for a specified statement of the relief sought means that a claimant who seeks monetary relief must state the amount in which such relief is sought already from the outset. If the claimant is unable to specify that amount at this stage, it is possible to instead seek a declaration of liability, per se, for patent infringement.
The respondent will normally be given between two and four weeks to respond to the summons application, depending on whether preliminary relief is sought or not. Extensions of deadlines fixed by the court may be granted upon a reasoned application. A respondent in validity proceedings may request that the patent is maintained with a more limited scope of protection and must in that case file amended claims.
Preliminary injunctions may be sought from the court. The preliminary injunction available under the Patents Act is sought in the scope of full merits proceedings. In order to seek such relief, the claimant must thus bring infringement proceedings and request that the injunction sought be granted also in the interim. It is possible to obtain preliminary injunctions on an ex parte basis, but it requires extreme urgency and are rarely granted. It is not possible to file protective letters with the court to mitigate risk for ex parte decisions. The grant of a preliminary injunction requires that the claimant can show probable cause of infringement of a valid patent. There is a rebuttable presumption of validity for the purposes of preliminary injunction requests. The claimant must also file a bond or other appropriate form of security in an amount covering the financial harm that the preliminary injunction may cause the respondent in the event the respondent prevails on the merits. Preliminary relief, such as seizure or injunctive relief, is also available under the Procedural Code and that may be sought in advance of bringing full merits proceedings.
While the court has the power to hold hearings on procedural issues, to which requests for preliminary injunction belong, it will rule on such requests based on the documents on the case file. The reason being that such request shall be ruled upon in an expedited manner. The time from the application to the ruling is normally between a few weeks up to six months, depending largely on the urgency of the matter and number of submissions the parties file on the issue.
A respondent in infringement proceedings may enter a validity defence. However, that defence will be inadmissible unless the respondent also brings separate proceedings for the revocation of the patent in suit. If a validity defence is argued, the court will order the respondent to initiate revocation proceedings within a time certain if the respondent wishes to maintain that defence. While revocation proceedings are separate from the infringement proceedings, they are normally consolidated and heard together.
At an appropriate stage of the proceedings, the court will hold a case management hearing. The purpose of that hearing is to identify any unclarities in the parties' positions and to set a schedule for the subsequent proceedings including the main hearing. A filing schedule will be fixed. The court will also endeavour to fix the length of the hearing by inquiring about the number of witnesses. A merits hearing can ideally be expected around 18 months after the start of the proceedings but that varies from case to case. The court is also required by law to explore whether there is a possibility of settling the dispute amicably, an issue normally discussed at the case management hearing.
While the court expects the parties to abide by the schedule so determined, there are few sanctions for not doing so. The parties may, for example, adduce additional evidence after the final statement of evidence. The court will normally declare the case file closed by a specific date. After that date, new facts and evidence will be inadmissible unless there is a valid excuse for introducing it at this late stage or if allowing the new facts and evidence will not substantially delay the proceedings. A more stringent cut-off order may be entered against a party who fails to bring enough clarity to its case. Such orders are rare and normally reserved for more recalcitrant litigants.
The proceedings are adversarial and with few exceptions there is no inquisitorial aspect of the court's function. It is for the parties to adduce evidence. Witnesses of fact and expert witnesses shall be named in the parties' written submissions together with an indication of what the party intends to prove with the testimony of the witness or expert. Written witness statements from a witness of fact are normally not admissible in Swedish proceedings. One exception from that rule is that it is permissible to rely on such written statements for the purposes of a preliminary injunction request. The general rule for expert witnesses is the direct opposite and a party who wishes to rely on expert testimony must thus submit an expert report.
Witnesses of fact and expert witnesses give testimony at the hearing. The parties hold an examination-in-chief of their respective witnesses and experts and the other party is entitled to a cross-examination. The court may ask questions but will normally only do so to make sure it has correctly understood the testimony.
Both parties may request document production. Unlike in some jurisdictions with more general rules on disclosure or discovery, document production is sought in respect of specific, identified documents. However, describing a category of documents or even an issue, for which the documents sought would be relevant, may be sufficient identification. There is a privilege for trade secrets. Production of documents containing trade secret information can nevertheless be ordered, but only if there are exceptional grounds for doing so. Determining whether there are exceptional grounds involves, among other things, an appraisal of how strong the requesting party's case is on the merits.
An infringement investigation order, which may also be sought separately, before initiation of proceedings and granted ex parte, can be used to secure evidence about infringement by searching for objects and documents. An order of this kind may be granted if the claimant can establish that there are reasonable grounds to assume that the party against whom the order is sought has committed an infringing act or contributed to such an act and the claimant provides a bond. The enforcement authority, which carries out the investigation, may photograph and record audio and video of such objects that it is instructed to search for in the order and may make copies of documents covered by the order. The authority may not seize specimens of infringing products or observe processes. The documentation so obtained shall be made available to the parties.
An information order may be granted if the claimant is able to establish probable cause for infringement or contribution to infringement. The subject matter of the order is information about the origins and distribution network of infringing goods or services, information on the number of sold products and products in stock as well as prices and gross margins.
Infringement and revocation proceedings are not barred by ongoing opposition proceedings before the SIPO or the EPO and the courts are normally reluctant to stay court proceedings pending the outcome of such administrative procedures unless both parties agree on the stay.
The court's judgment will normally be preceded by a merits hearing. At that hearing and the subsequent deliberations, the court will sit as a panel, normally composed of two legal and two technical judges. At the hearing, the parties will each give an opening statement intended to present the facts and written evidence to the court. This will be followed by the examination of witnesses and experts and the hearing will conclude with closing statements.
The court will deliver a written judgment between three weeks and a few months after the hearing. Costs will be awarded in the judgment and the general rule is that the prevailing party will be compensated for its litigation costs, insofar as they are deemed reasonably motivated to protect the party's interests. The rules on litigation costs give the courts power to impose sanctions for negligent conduct of proceedings or the bringing of unnecessary proceedings by making the responsible party liable regardless of the outcome or even holding the parties' directors or counsel jointly and severally liable for costs. However, those powers are rarely used.