Germany adopts new patent law targeting patent trolls

Today, the German Bundestag adopts a new patent law that introduces the principle of proportionality in the patent law when it comes to patent injunctions. The reform of the patent law aims at putting an end to the abuse of the patent law by so-called patent trolls. Patent trolls do typically not secure patents in order to promote innovations, but in order to use them in a misappropriated manner as a potential threat towards other companies. Concerned about a production stop achieved with an injunction, companies often pay unreasonable amounts to these patent trolls.

A core element of the new law is that a court is not lot required to hand out injunctions automatically, but can take into account disproportionate hardship to alleged infringers or third parties when an injunction is to be enforced. The previous case law of the German Federal Court of Justice will thereby be anchored in law.

If for example the patent claims are upheld while an injunction is rejected by the court, the court would have to order the alleged infringer to pay reasonable compensation to the patent holder. The compensation should at least amount to what would have been paid as a normal royalty for the patent. The amount of the compensation may however be increased in case the alleged infringer failed to conduct appropriate due diligence, or it may be reduced in case the court deems the patent to have been acquired for the sole purpose of forcing the alleged infringer to pay disproportionate settlements under the threat of a patent injunction.

Read more: https://www.wsj.com/articles/germany-shuts-door-on-patent-trolls-11623397397