UPC faces liability risks: How US companies need to prepare
UPC faces liability risks: How US companies need to prepare
US companies are in the top tier when it comes to ‘who sues’ and ‘who is sued’ before the UPC.
The Unified Patent Court (UPC) has established itself as a hallmark for high-profile patent litigation in less than two-and-a-half years. US companies need to be aware of this reality. Reason being they are ‘at both sides of the v’ before the UPC. US companies are in the top tier when it comes to ‘who sues’ and ‘who is sued’ before the UPC.
The 10 most important questions that define liability risks before the UPC, both from a defendant’s and a plaintiff’s perspective are:
1) whether injunctive relief is the general rule or the exception?
While there are cases where the UPC will accept limitations to injunctive relief, there are no ’eBay-factors’ that would have to be applied before the UPC when deciding on requests for injunctive relief.
2) Whether the granting of provisional measures is ‘necessary’ Or the patentee ‘jumps the main action queue’ is justified.
Irreparable harm is certainly a sufficient, but not a necessary condition for meeting this test. Where competitors are fighting over market shares, there is a decent chance that the UPC considers the grant of a preliminary injunction as being ‘necessary’.
3) A UPC judgement covers which territories?
If a Unitary Patent is successfully asserted the UPC-judgment covers all the 18 UPC-States of ’UPC Land’, since a Unitary Patent covers as a single right those 18 countries (which include the most important EU states, such as Germany, France and Italy). If a traditional European Bundle Patent is successfully asserted, the UPC-judgement can also cover these 18 UPC-States, provided that the patent was validated in those 18 countries (which is mostly not the case, other than in the areas of pharma and life sciences).
4) How long does it take to get a first instance and a final decision?
While the UPC Court of First Instance generally speaking delivers its decisions within 12 to 18 months, the second instance is even faster due to the more limited written procedure with only one brief for each party.
5) Is there a bond requirement?
The Rules of Procedure give the Court discretion whether to make the enforcement of a judgement subject to the provision of a security.
6) Do UPC injunctions have teeth? What happens if the alleged infringer is in contempt of court?
Generally, the UPC’s decisions and orders provide for periodic penalty payments in the event that a party fails to comply with the terms of the order. These penalties are payable to the Court (and not the plaintiff). However, this is not decisive.
7) Are directors personally liable for patent infringement?
Directors of a company are, as a general rule, not liable for patent infringements committed by the company. The situation before the UPC is comparable to the situation in the United States in this respect. However, once the company violates a first instance decision, this general rule can turn into the exception.
8) What is the range of UPC damages awards?
The range of UPC damages awards is a black box as of today, since not a single decision on the amount of damages has been handed down by the UPC yet. However, this will change over the next 24 months. What is already clear is that UPC is a one-stop shop for damages. This means that the UPC’s competence to adjudicate damages is as broad as its competence to issue injunctive relief. Thus, for a standard case, the UPC can award damages for patent infringements in up to 18 countries.
9) What are the current success rates for infringement and invalidity?
As of October 31, 2025, it only makes sense to look at the success rates before the Court of First Instance of the UPC (the sample size of the cases already decided by Court of Appeal in proceedings on the merits is simply still too small as not even a handful of cases were decided yet). When it comes to infringement, plaintiffs prevailed in 51% of the cases on the merits (and 59% of the preliminary injunction cases). Thus, in the majority of the tried cases, the patent in suit was held to be valid and infringed. This rate is unsurprising as the judges of the UPC always made clear that the court wants to be perceived as a neutral and unbiased venue. However, this rate must be put into perspective: on the one hand, this rate is high given the number of UPC proceedings which settled prior to trial and prior to a decision having been handed down. On the other hand, this rate is low as many of the proceedings supporting this success rate were cases relating to patents which had previously been litigated before the national European courts prior to bringing them to the UPC, with the goal to broaden the territorial scope of the existing national judgments obtained prior to the entering into force of the UPC-Agreement.
10) What if a UPC decision was enforced and later on overturned?
Of course, UPC liability is not a one-way-street. If a decision or order of the Court is varied or revoked once it had been enforced, the Court may order the party which has enforced such decision or order, upon the request of the party against whom the decision or order has been enforced, to provide appropriate compensation for any injury caused by the enforcement
