No. 144 - 18 August, 2026
Which law applies to financial claims before and after the grant of a European patent, and before and after 1 June 2023? The Court of Appeal has now drawn an important distinction.
Damages for infringement of a granted patent are governed by the UPCA for acts committed since 1 June 2023. By contrast, the UPCA does not provide a substantive legal basis for compensation based on the provisional protection conferred by a published European patent application. Such claims remain governed by national law – irrespective of when they arose.
This distinction may have surprisingly far-reaching consequences. In particular, different limitation periods may apply to use of the invention before and after grant. Under German law, a residual claim may remain available for up to ten years. It therefore appears possible that compensation for use of an invention before grant may, in certain circumstances, remain recoverable for longer than damages for infringement of the subsequently granted patent.
The Court did not expressly decide this consequence, and the interaction with Art. 72 UPCA deserves some caution. Nevertheless, its reasoning provides considerable support for this conclusion.
The dispute concerned EP 3 356 109 and proceedings between Yellow Sphere and Härtwich on the one hand and Knaus Tabbert on the other. Yellow Sphere and Härtwich asserted the patent in Germany, France, Italy and Slovenia and sought, among other remedies, damages and reasonable compensation for use during the period of provisional protection. The Düsseldorf Local Division had largely upheld the infringement action and dismissed Knaus Tabbert's counterclaim for revocation.
On appeal, this required the Court of Appeal to address a fundamental question that is becoming increasingly important as the UPC deals with conduct extending both before and after 1 June 2023: which substantive law governs the various remedies?
The Court drew a clear distinction between damages for infringement of a granted patent and compensation based on a published patent application.
According to the Court, the UPCA contains no substantive legal basis for damages or compensation based on the provisional protection conferred by a published European patent application. Art. 32.1(f) UPCA merely confers competence on the UPC to hear such actions.
The substantive starting point is instead Art. 67 EPC, applicable through Art. 24.1(c) UPCA. Art. 67 EPC leaves the EPC Contracting States a degree of discretion as regards provisional protection, subject to the minimum requirement of reasonable compensation.
The consequence identified by the Court is particularly important: national law applies irrespective of when the claim arose.
Thus, this is not merely a transitional rule for conduct before the UPCA entered into force. Even use of an invention under a published European patent application after 1 June 2023 remains subject to the applicable national law.
This is where the decision becomes particularly interesting.
For infringement of a granted patent, the Court takes a different approach. Each individual act of infringement gives rise to a damages claim. Acts completed before 1 June 2023 are therefore governed by national law, whereas acts since 1 June 2023 fall under the UPCA.
For the latter, Art. 72 UPCA provides a five-year limitation period linked to the claimant's actual or constructive knowledge of the last event giving rise to the action. The Court expressly applied Art. 72 UPCA to acts committed since 1 June 2023.
For compensation based on a published European patent application, however, the Court says that national law applies irrespective of when the claim arose. This should in principle also extend to the applicable national rules on limitation.
For Germany, the consequences may be particularly striking. The German rules applicable to provisional protection provide not only for the ordinary limitation regime but also for the residual claim under Section 852 BGB. Following expiry of the ordinary limitation period, such a claim can, subject to its more limited requirements and scope, remain available for up to ten years.
This creates the possibility of an unusual result: the financial claim relating to use before grant may remain enforceable for longer than the damages claim relating to infringement after grant.
There is, however, reason for some caution. Art. 72 UPCA refers broadly to actions relating to “all forms of financial compensation”. The Court did not expressly address whether this provision could nevertheless impose an additional five-year limit on a claim for provisional protection otherwise governed by national law.
I tend to think that it should not. The Court treats the relevant UPCA provisions on damages and limitation as part of the substantive legal regime and expressly holds that national law governs claims based on provisional protection irrespective of when they arose. Moreover, Art. 72 itself applies without prejudice to Art. 24.2 and 24.3 UPCA. Applying Art. 72 as an overriding five-year cap would therefore sit somewhat uneasily with the Court's reasoning.
Still, this particular consequence remains to be worked out in future cases. For the moment, the decision at least opens the door to a potentially important difference between the limitation regimes applicable before and after grant.
The decision also provides useful guidance for damages based on the granted patent.
The Court considers each individual act of infringement to constitute a completed factual situation for the purposes of damages. Accordingly, damages resulting from acts completed before the UPCA entered into force are governed exclusively by national law.
For German acts before 1 June 2023, the Court therefore applied the German limitation regime. It referred to the regular three-year limitation period under Sections 195 and 199 BGB and rejected the limitation defence because Knaus Tabbert had not sufficiently established the necessary knowledge on the part of the patent proprietors.
By contrast, acts committed since 1 June 2023 are subject to Art. 72 UPCA and its five-year limitation period.
The applicable limitation regime can therefore differ not only between pre-grant and post-grant use, but also between individual acts of infringement depending on whether they occurred before or after 1 June 2023.
The decision contains several further points worth noting. Given the breadth of the decision, they can only be touched upon briefly here.
First, the Court does not apply the same temporal analysis mechanically to every remedy. Injunctions concern future conduct. Recall and removal concern infringing products that remain within the channels of commerce, while destruction concerns products still in the direct or indirect possession or ownership of the infringer. The applicable law must therefore be assessed separately for the individual remedies sought.
Second, the decision provides further guidance on limitation. For acts of infringement committed since 1 June 2023, Art. 72 UPCA applies, whereas earlier acts remain subject to the applicable national limitation rules. Under German law, the limitation defence failed in the present case because Knaus Tabbert had not sufficiently established when the patent proprietors had obtained the knowledge required under Sections 195 and 199 BGB.
Finally, the Court provides an important procedural reminder concerning national law. Where national law applies, it is for the parties to present their legal arguments and, where appropriate, private expert opinions on its content. A party relying on a particular rule or interpretation of national law bears the burden of presenting and establishing it. This may become particularly important in UPC litigation involving several national designations.
The decision is therefore something of a treasure trove on the temporal and substantive interaction between the UPCA and national law. Its potentially most far-reaching aspect, however, may be the distinction between damages for infringement of a granted patent and compensation for use of an invention during the period of provisional protection.
And there is still more. The decision also contains noteworthy guidance on substantive patent law. The Court addresses when the skilled person would consult an expert from another technical field, the interpretation of product-by-process features, the relevance of the order in which method steps are listed in a claim, and the limits of what a generic disclosure makes available to the skilled person.
The Court further observes that the national rules implementing the Enforcement Directive can generally be presumed not to fall below the standards of Art. 68.1 UPCA on damages and Art. 67.1 UPCA on information.
Taken together, the fifteen headnotes make this an unusually rich Court of Appeal decision, reaching from claim interpretation and disclosure to remedies, applicable law and limitation.
Taken together, the fifteen headnotes make this an unusually rich Court of Appeal decision, reaching from claim interpretation and disclosure to remedies, applicable law and limitation. My prediction: this will become one of the most frequently cited UPC decisions of the coming years!
