Federal Court of Justice, Decision of 6 May 2010, Xa ZR 70/08 (Machine assembly)

The Federal Court of Justice decided on the controversial question of whether a non-final limitation of a patent can be considered in infringement proceedings. The court held that the patentee is able to enforce his patent - at least in its limited version - without having to wait for a final decision in parallel nullity proceedings and with a reduced risk of a stay of proceedings.

The plaintiff brought an infringement action on the basis of his European patent for an electro-hydraulic machine assembly and requested injunctive relief, rendering of accounts and destruction of the defendant's infringing products as well as a declaratory judgment regarding the defendant's liability for damages.

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The District Court of Düsseldorf found no infringement, holding that there was no congruence between the attacked embodiment and the protected technical solution.

In the meantime, the defendant had attacked the patent in suit (the patent underlying the infringement action) by way of nullity proceedings. In these proceedings, the claims of the patent were limited so that the patent was only maintained in this limited form for the territory of Germany. Both parties appealed this decision.

In the infringement proceedings, the plaintiff appealed the decision of the District Court of Düsseldorf; however, now based on the limited claims of the patent in suit, as upheld by the Federal Patent Court.

The Court of Appeal of Düsseldorf confirmed the decision of the District Court, but allowed a further (legal) appeal to the Federal Court of Justice. The court said that the question how the scope of a patent shall be construed for the purposes of infringement proceedings on the basis of a limited version of patent claims before a final decision in parallel nullity proceedings has been rendered was a "fundamental" question of law under the German Code of Civil Procedure.

The Federal Court of Justice now confirmed that it is possible to consider the limitation of a patent in infringement proceedings, even before a final decision in parallel invalidity proceedings has been rendered. However, the limited version of patent claims can only form the basis of the assessment of infringement if the formal request has been limited accordingly. The subject matter of the infringement proceedings is limited to the question whether the patentee is entitled to its claims on the basis of the limited patent. Therefore, limiting the formal request corresponding to the limitation of the patent claims is the only way to take the subject and scope of the limited patent in suit into account before the limitation is finally established in the nullity proceedings.

In German infringement proceedings, the court is generally bound by the patent as granted without any competence to decide on the validity of the patent in suit. Nevertheless, the patentee is free to limit the matter in dispute by asserting the limited patent claims and phrasing the request in the statement of claim correspondingly. Such limitation may be made from the very beginning or during the infringement proceedings by an amendment of action.

Such restriction might also be relevant for the decision to stay the infringement proceedings pending a final decision in the nullity proceedings. The decision to stay the infringement proceedings essentially depends on the chances of success (of the nullity plaintiff) in the nullity proceedings and, therefore, must be made on the basis of the version of the patent which is defended in the nullity proceedings. As a consequence, the decision to stay the proceedings depends not only on the patent's validity, but also on the admissibility of its limitation.

The decision conveys important consequences for German patent law. It brings more clarity for the patentee in deciding on the best litigation strategy while the outcome of the nullity proceedings is still uncertain. Furthermore, the patentee can avoid formal limitation procedures according to section 64 of the German Patent Act / article 105a EPC. The implication for the infringement court to rely on a - strictly speaking - "unexamined" right is justified by the consideration that the competent granting authority has established the patentability with regard to the original, unlimited version. Provided that the limitation leads to a sufficient distinction from the relevant prior art, this finding will usually also apply to the limited version. From the defendant's perspective, there is no unreasonable disadvantage. Should the patent turn out to be invalid even in the limited version, the defendant is entitled to claim compensation if the plaintiff has already enforced the judgment.