At a glance: patent enforcement proceedings in Brazil

Patent enforcement proceedings

What legal or administrative proceedings are available for enforcing patent rights against an infringer? Are there specialised courts in which a patent infringement lawsuit can or must be brought?

The administrative proceedings before the Brazilian Patent and Trademark Office (BPTO) available for owners to enforce their patent rights in Brazil are prescribed in the Brazilian Industrial Property Law (BIPL), as follows:

• petition of subsidies, which may be filed by interested third parties with the objective of indicating to the examiner the reasons why a patent should not be granted; and
• administrative nullity proceedings, which can be started by any person with a legitimate interest within a period of six months of the granting of the patent, on the grounds that:
  • any of the legal requirements were not satisfied;
  • the specifications and claims did not comply with the provisions of articles 24 and 25 of the BIPL;
  • the object of the patent extends beyond the contents of the application filed originally; or
  • one or more of the essential formalities indispensable to grant were omitted during the processing thereof.

Administrative nullity proceedings are heard by the President of the BPTO, who has final jurisdiction to rule on the matter.

The BIPL also establishes, in articles 56 and 57, the possibility of filing judicial nullity proceedings at any time during the term of the patent, either by the BPTO ex officio or by any person who has a legitimate interest.

In addition, an infringement action may also be brought against the infringer of a patent. The BIPL provides that infringement of patent rights constitutes both a civil wrong (tort) and a crime. Hence the injured party is entitled to rely on both civil and criminal measures in order to enforce its rights.

As for civil proceedings, the injured party may file a lawsuit seeking the cessation of the infringing act, coupled with a claim for damages. The lawsuit may include an ex parte preliminary injunction request, with a view to immediate cessation of the harmful conduct until a decision on the merits is rendered. In order to obtain a preliminary injunction, the plaintiff must demonstrate a prima facie case that there is a likelihood of success on the merits of the case and that delay in granting the relief sought would be likely to give rise to harm that is irreparable or very difficult to redress.

The plaintiff may also seek the imposition of a daily penalty for failure to abide by the preliminary injunction. If the interim relief sought is granted, the defendant will be restrained from practising the infringing act pending a final and definitive ruling on the substantive lawsuit. In some circumstances, a court will only grant interim injunctive relief if the petitioner posts a bond or a fiduciary guarantee to cover any losses incurred by the respondent.

A criminal action requires the filing of a criminal complaint. In terms of criminal proceedings, one very important provision is the possibility of filing a preliminary criminal search and seizure action, aimed at gathering evidence of acts of infringement and avoiding the destruction or hiding of evidence by the infringer. Pursuing a preliminary criminal search and seizure action is normally more straightforward than undergoing the more complicated civil proceeding of early production of evidence. Given that it is possible to rely both in civil and criminal proceedings on the evidence obtained under a search and seizure warrant, an application for preliminary criminal search and seizure is frequently a useful starting point for civil infringement proceedings as well as for criminal proceedings per se.

Finally, infringement actions must be filed before state courts, as the BPTO does not participate in such proceedings, whereas the nullity actions are heard by federal courts. This is because the BPTO is automatically a party to all nullity actions, and whenever a government agency is a party to a lawsuit, the action must be filed before federal courts. Nullity actions are usually filed in Rio de Janeiro, where the headquarters of the BPTO are located.

The entry level (first instance) of the Federal Court of Rio de Janeiro has four courts specialising in intellectual property. At the appeal level, the Regional Federal Court of the Second Region, which has jurisdiction over the states of Rio de Janeiro and Espirito Santo, has two specialist panels for intellectual property.

What is the format of a patent infringement trial?

Infringement and nullity actions are heard by a single judge at first instance. The appellate courts (second instance) consist of panels of three judges.

Once the initial complaint is filed, the defendant is notified to present its response within 15 days. The plaintiff may respond to the defendant’s answer within 10 days. There are usually two hearings at first instance: a conciliatory or preliminary hearing, at which the parties try to settle the case amicably; and an evidentiary hearing, at which the expert and the parties’ technical assistants may be cross-examined as to their findings in the event of a dispute between them (the relevant questions having been filed and responded to in writing prior to the hearing - the scope of the cross-examination being issues that remain in dispute); depositions are taken from the parties and the witnesses listed are heard. It is important to note that this second hearing occurs only in cases where there is a need for evidence to be produced.

At the close of the hearing, the judge may immediately make a decision or may direct that the parties submit final briefs. In the latter case, the judge will make the final order once he or she has considered the final briefs.

It is possible to file an appeal against this order to the State Court of Appeal. The final order on appeal of the State Court of Appeal may be challenged, provided certain legal requirements are met, by a further appeal, known as a ‘special’ appeal, to the Superior Court of Justice, or an ‘extraordinary’ appeal to the Federal Supreme Court.

A final decision on infringement and nullity actions may take between one and two years at first instance. A final decision at second instance may take up to two years. These time frames will vary according to the complexity of the case, and the state and court in which the lawsuit is filed. Preliminary injunctions may be granted immediately, provided the legal requirements are met.

What are the burdens of proof for establishing infringement, invalidity and unenforceability of a patent?

To prove infringement, it is necessary for the plaintiff to make a direct comparison and demonstrate that the infringing product contains at least one of the independent patent claims and that it includes all the characteristics of said claim.

To prove nullity, it is necessary for the plaintiff to show that the patent does not satisfy at least one of the prerequisites for grant.

Concerning unenforceability, a patent is not enforceable against a supposed infringer when:

• the acts are performed privately and without commercial purpose, provided such acts did not result in prejudice to the economic interests of the patent owner;
• the acts are performed for experimental purposes, relating to studies or scientific or technological research;
• the products are related to the preparation of a medicine in individual cases by a qualified professional;
• the products are manufactured in accordance with a patent that has been placed on the internal market directly by the patent owner or with its consent;
• in the case of patents related to living matter, the living matter in question is used without economic purpose as the initial source of variation or propagation in order to obtain other products; and
• in the case of patents related to living matter, the product has been placed on the internal market by the patent owner or with its consent, provided the product is not used for commercial multiplication or propagation of the living matter.

A patent is also unenforceable when the supposed infringer, in good faith, had already made use of the object of the patent in Brazil prior to the filing date or the priority date of the patent application.

Who may sue for patent infringement? Under what conditions can an accused infringer bring a lawsuit to obtain a judicial ruling or declaration on the accusation?

A patent infringement action can be brought by the owner of the patent.

In a civil infringement action, the accused infringer, as defence, may assert facts that impede, modify or terminate the plaintiff’s rights and, in addition, if the legal prerequisites are duly met, may file a counterclaim against the plaintiff.

In relation to criminal actions, an allegation of nullity of the patent registration on which the action is based may be relied upon as a defence by the accused infringer.

In addition, the accused infringer may sustain that its use of the invention or model of utility does not infringe the patent. In this sense, articles 43 and 45 of the BIPL provide exceptions to patent infringement, such as:

• private acts without commercial purpose that do not jeopardise the economic interests of the patent owner;
• acts of experimental purposes in connection with scientific and technological studies and researches;
• preparation of a medicine in accordance with a medical prescription for individual cases;
• a product manufactured in accordance with a process or product patent that has been introduced onto the domestic market directly by the patent holder or with its consent;
• non-economic use of the patented product as an initial source of variation or propagation to obtain other products, in the case of patents related to living material;
• production of data and results of tests with the purpose of obtaining authorisation for commercialisation of the patent product after the term of the patent expires; and
• use in good faith of the object of the patent prior to the priority or filing date of the patent application.

To what extent can someone be liable for inducing or contributing to patent infringement? Can multiple parties be jointly liable for infringement if each practises only some of the elements of a patent claim, but together they practise all the elements?

According to the provisions of the BIPL, crimes against patents are determined to have been committed even when the violation does not affect all the claims of the patent or is restricted to the utilisation of means equivalent to the object of the patent.

In this sense, besides the manufacturing of a product or the using of a means or process that is the object of a patent without authorisation from the owner, it is also considered a crime against a patent in Brazil when anyone:

• exports, sells, displays or offers for sale, has in stock, conceals or receives, with a view to use for economic purposes, a product manufactured in violation of a patent, or obtained by a patented means or process;
• imports a product that is the object of a patent, or obtained by a means or process patented in Brazil, with a view to use for economic purposes, and that has not been placed on the foreign market directly by the patent owner or with its consent; or
• supplies a component of a patented product, or material or equipment to execute a patented process, provided that the final application of the component, material or equipment leads necessarily to the exploitation of the object of the patent.

Can multiple parties be joined as defendants in the same lawsuit? If so, what are the requirements? Must all of the defendants be accused of infringing all of the same patents?

In accordance with the Brazilian Civil Procedure Code (CPC), multiple parties can be joined as defendants in the same infringement lawsuit when:

• they possess equal rights or obligations relating to the issue;
• the rights or the obligations derive from the same fact or legal ground, for example infringement of the same patent;
• the issue involving each defendant is connected by the object or the cause of action; and
• there are similar questions due to a common point of fact or law.

In addition, the CPC requires that multiple parties be joined as defendants in the same lawsuit when, by provision of law or by the nature of the legal relationship, the judge has to decide the matter uniformly for all parties. In this hypothesis, the effectiveness of the decision depends on the summons of all joint parties in the lawsuit.

To what extent can activities that take place outside the jurisdiction support a charge of patent infringement?

The patent rights granted by the BPTO are valid within Brazilian territory. According to the BIPL, a patent confers on its owner the right to prevent a third party, without the owner’s consent, from producing, using, offering for sale, selling or importing for these purposes a product that is the object of the patent or a process or a product directly obtained by a patented process. In order to support a charge of patent infringement, the production, use, offer for sale, sale or importation referred to must be within the Brazilian territory.

To what extent can ‘equivalents’ of the claimed subject matter be shown to infringe?

In Brazil, infringement may occur in three different ways:

• literal infringement – when any single claim of a patent reads on the item or process under review of any interested (third) party, such that the item or process has all of the elements listed in the claim. This type of infringement is established if any one of the claims reads on the infringing product. Even if the product or process incorporates additional elements that may be patentable, literal infringement may be alleged by the patentee. For a product or process to avoid infringement of a prior patent, the product or process under consideration must not have at least one element recited in each claim of the patent;
• doctrine of equivalents infringement – this doctrine may be invoked by a patentee against the producer of a later device if the later device performs substantially the same function in substantially the same way, to obtain the same result. Further, although this doctrine extends the claims beyond their literal words, it does not prevent the manufacture, use, or sale by others of every device that is generally similar to the patented invention. Last, it is important to note that the concept of equivalence does not apply to a structure that is specifically excluded from the scope of the claims; or
• contributory infringement – for a contributory infringement to be characterised, the following situation should occur:
• the means offered or provided by the infringer for contribution relate to a significant element of the protected object by intellectual property rights;
• said means has to be for an infringing use; and
• at the time of offering or providing, the suitability and intended use are known to the supplier or it is obvious under the circumstances.

What mechanisms are available for obtaining evidence from an opponent, from third parties or from outside the country for proving infringement, damages or invalidity?

The CPC states that the plaintiff may draw on all legal and morally legitimate means of proving the existence of the rights asserted. It makes specific reference to ‘personal deposition’ (the giving of oral evidence by the person or persons asserting the rights); the exhibition of documents or other material; witness testimony; expert evidence; and court inspections.

In addition, the CPC permits the court to direct early production of evidence. A party is therefore entitled, for example, to make an application for the production of expert evidence prior to the filing of the substantive lawsuit (or, post-filing, at an early stage of the proceedings). The plaintiff must demonstrate solid reasons for the application, for example, that there are reasonable grounds for fearing that, in the absence of an order for early production, the evidence in question may be lost or destroyed.

However, discovery, in the form that exists in common law systems as a pretrial phase in a lawsuit, is not provided for in the Brazilian legal system.

What is the typical timetable for a patent infringement lawsuit in the trial and appellate courts?

A final decision on infringement and nullity actions may take between one and two years at first instance.

A final decision on second instance may take up to two years. Appeals to the Superior Court of Justice or to the Federal Supreme Court are estimated to take between two and four years to be analysed and have decisions issued.

These time frames will vary according to the complexity of the case, and the state and court in which the lawsuit is filed. Preliminary injunctions may be granted immediately, provided the legal requirements are met.

What is the typical range of costs of a patent infringement lawsuit before trial, during trial and for an appeal? Are contingency fees permitted?

The cost range depends on the complexity of the case. In Brazil there are law firms that charge professional fees on an hourly basis and others that base their fees on the events that occur during the lawsuit (eg, filing the court action, obtaining a favourable injunction decision, appealing a decision). A success fee is also usually charged.

What avenues of appeal are available following an adverse decision in a patent infringement lawsuit? Is new evidence allowed at the appellate stage?

The CPC sets out various avenues of appeal to which parties may resort.

There are both appeals on the merits (substantive issue) of a case and appeals on procedural grounds or relating to questions other than the substantive issue. The possible forms of appeal include motions based on conflicting case law, motions for clarification of the ruling and appeals based on internal court rules. The final decision of the first instance court, for example, may be challenged on appeal before the State Court of Appeal by means of an apelação. From the Appellate Court, a further appeal is possible on issues pertaining to federal law, to the Superior Court of Justice or, in the event of a constitutional issue arising, to the Federal Supreme Court.

The appeal courts consist of panels of three judges.

As for new evidence at the appellate stage, although the CPC, in article 434, indicates that the moment for a party to present evidence is at the first opportunity it has to communicate in the lawsuit, following the provisions of article 435, the production of documental evidence as to supervening facts is permitted at any time.

To what extent can enforcement of a patent expose the patent owner to liability for a competition violation, unfair competition, or a business-related tort?

The enforcement of patent rights exposes the owner to liability in the sense that, should the accused infringer not be considered guilty, it may allege that such action was an act of unfair competition by the patent holder as, in accordance with article 195 of the BIPL, a person is guilty of unfair competition when, among other situations, with the purpose of obtaining some advantage, she or he publishes, by any means, false statements to the detriment of a competitor, or provides or divulges false information about the competitor.

In addition, the BIPL prescribes, in article 209, for the aggrieved party the right to recover damages for losses caused by acts of unfair competition that prejudiced the aggrieved party’s reputation or business, created confusion among commercial or industrial establishments or service providers, or among the products and services placed on the market.

To what extent are alternative dispute resolution techniques available to resolve patent disputes?

The BIPL does not have any provision related to alternative dispute resolution. Arbitration proceedings, which are governed by the Arbitration Law (Law No. 9,307, of 23 September 1996), are not commonly used in trademark and patent infringement cases, but the parties may agree to arbitration instead of resorting to the courts. Among the possible benefits of using arbitration are the comparative speed of proceedings and their confidentiality.

Law stated date

Give the date on which the information above is accurate.

12 March 2021.