1.1 What are the principal sources of law and regulation relating to patents and patent litigation? (Briefly describe the role of international, federal or state laws and relevance of court decisions, list and briefly describe relevant statutes and international treaties)
(a) National law
The principal source of national law relating to patents is the Swiss Patent Act. Subsidiary provisions concerning the registry and the registration procedure are set out in the Patent Ordinance. Inventions made by employees in the course of their duties are governed by Art 332 of the Swiss Code of Obligations. The procedural law relating to patent litigation is set out in the federal Act of Private International Law and the cantonal codes of civil procedure. Switzerland consists of 26 sovereign cantons all of which have their own code of civil procedure.
(b) International treaties
Switzerland is party to a number of international treaties in relation to patents, including the Paris Convention, the TRIPs Agreement, the Patent Co-operation Treaty (PCT) and – most significantly – the European Patent Convention. Switzerland has been an active proponent of the European Patent Litigation Agreement (EPLA) and the London Protocol concerning translation requirements. However, the ratification of the EPLA has been blocked by the European Commission which supports the Community Patent instead. Switzerland is also a party to the Lugano Convention on Jurisdiction and the Recognition and Enforcement of Judgments in Civil and Commercial matters which is significant with regard to jurisdictional and other procedural issues.
(c) European Community Law?
Switzerland is not a member of the European Union. Community law is, therefore, not directly applicable in Switzerland. Chapters I–IV of the Directive 98/44/EC on the Legal Protection of Biotechnological Inventions indirectly apply at least to the Swiss part of European patents as a result of their implementation into Part 2, chapter VI (rr 23b–23e) of the Implementing Regulations of the European Patent Convention. In addition, a bill to revise the Patent Act so as to make it inter alia compliant with the Directive 98/44/EC on the Legal Protection of Biotechnological Inventions is currently under discussion in Swiss Parliament. It is not yet clear whether this bill will be passed any time in the near future.
(d) Court decisions
Switzerland does not adhere to the concept of binding precedence of court decisions, as more fully explained in question 2.2 below.
1.2 What is the order of priority of the relevant sources, ie which take precedence in the event of a conflict?
International treaties which Switzerland has adopted and are binding on it acquire immediate national validity. There is no need, therefore, to enact special laws to transform them into national legislation (although international agreements are generally ratified only after adapting Swiss national legislation, if and when this is necessary).
In the event of a conflict between international and national laws, it is generally recognised that international law takes precedence over national law. In previous rulings the Federal Supreme Court has considered that binding provisions in federal law that are contrary to international law prevail if the legislator knowingly adopted such provisions that contradict international law. In a new ruling, however, the Federal Supreme Court seems to admit the unrestricted validity of the principle that international law takes precedence over national law.
Although international treaties do not require any special steps for their transformation into Swiss national law, they are often not directly applicable, but rather aimed at the legislator. Provisions of international law are only directly applicable in Switzerland if they are formulated clearly and unconditionally enough to have a direct bearing and to be applied in a specific case or to constitute the basis on which a decision can be made. To the extent international law is transformed into Swiss national law such national law must be construed so as to comply with the relevant international law.
At national level, the Patent Act is the principal statute and the Patent Ordinance is subsidiary legislation. In the event of a conflict, the Patent Act, therefore, prevails.
2.1 In which courts are patents enforced? Are they specialised patents courts? If not, what level of expertise can a patent holder expect from the courts?
Patent proceedings are not assigned to any specialist federal court in Switzerland. Switzerland consists of 26 sovereign cantons all of which have set down their own court systems and their own codes of civil procedure (there is currently a bill under discussion in Switzerland to create a unified system of civil procedure, but not court system). Each canton has one specific court in charge of hearing patent cases. Those cantonal courts are not specialist patent courts, but hear patent cases among many other cases. In the larger cantons, especially in those that have commercial courts with technical judges (ie the commercial courts of the cantons of Zurich, St Gall, Argovie and Berne), the courts hear several patent cases a year. A patent owner can, therefore, expect a significant level of expertise from these courts. However, in many cantons patent cases are only rarely heard. A patent owner can only expect a low level of expertise in these cantons. As the cantonal courts are not specialist courts, experts are frequently appointed by the court to assist the judges in making decisions; even the commercial courts with technical judges may appoint experts, albeit less frequently (see also below question 6.3).
Forum shopping is generally possible, except where a foreign plaintiff sues a Swiss defendant for patent infringement. In this case, the plaintiff will usually have to sue the defendant at his domicile.
There is currently a bill under discussion in Switzerland to create one specialist federal patent court for all of Switzerland. It is not yet clear whether this bill will be passed any time in the near future.
2.2 To what extent are courts willing to consider, or are bound by, the opinions of other national or foreign courts that have handed down decisions in similar cases?
The courts are in principle not bound by the opinions and decisions of other national courts that have dealt with similar cases. The cantonal courts are not even bound by the opinions of the Federal Supreme Court – except when a decision of a cantonal court has been remanded by the Federal Supreme Court, in which case the cantonal court in handing down a new decision is bound by the opinion of the Federal Supreme Court. It is, however, unlikely that a cantonal court will decide a case differently if the Federal Supreme Court has already dealt with such a case. In practice, the opinions of the Federal Supreme Court are, therefore, generally binding for lower instance courts.
Swiss courts are, as a general rule, willing to consider the reasoning given by foreign courts that have handed down decisions in similar cases – especially with regard to courts from neighbouring countries, in particular Germany. This is even more so in proceedings involving European patents, given the significant degree of harmonisation of European patent law. Although decisions of foreign courts are technically not binding for Swiss courts, they are generally taken into account as an important additional source of inspiration.
2.3 Do the courts deal with infringement and invalidity simultaneously? Or must invalidity actions be brought in separate proceedings? If so, before which court or government agency (eg the Patent Office)?
The cantonal courts may deal with infringement and invalidity simultaneously. The defendant to infringement proceedings may seek to challenge the validity of the patent by way of defence or by way of counterclaim. Typically, a court will first deal with invalidity and, where the patent is held to be valid, will then deal with infringement.
To invalidate a Swiss patent, an invalidity action must be brought in court proceedings. The Swiss Patent Office does not provide for opposition proceedings and does not itself handle invalidity issues, other than revocation following invalidation in court proceedings. In the case of European patents, opposition can be filed with the European Patent Office within the opposition period. After expiry of the opposition period or dismissal of the opposition, an invalidity action may be brought in court proceedings to invalidate the Swiss part (but no foreign counterpart) of a European patent.
2.4 Who can represent parties before the courts handling patent litigation and/or the government agency dealing with patent validity issues?
Only attorneys at law admitted to the bar can represent parties before the courts handling both patent infringement and validity issues. It is common and highly advisable to retain specialised attorneys at law for representation. Patent agents (usually known as patent attorneys in Switzerland) do not have rights of audience before the cantonal courts, but are sometimes permitted to speak before judges on an informal basis to assist attorneys at laws in technical matters at hearings. Patent agents, who are admitted to practice before the European Patent Office, can represent parties in opposition proceedings before the European Patent Office.
2.5 What is the language of the proceedings? Is there a choice of language?
German, French and Italian are official languages in Switzerland. In the German-speaking part of Switzerland, the language of the proceedings is German, in the French speaking part it is French and in the Italian speaking part it is Italian. There is a (limited) choice of language only in the (bilingual) cantons of Berne, Fribourg, Valais and Grisons.
2.6 To what extent are courts willing to grant cross-border or extraterritorial injunctions?
Swiss courts may in principle grant cross-border or extra-territorial injunctions (involving foreign counterparts of a Swiss patent) if they have jurisdiction over the cross-border dispute.
It is generally recognised that this is only the case if the defendant to infringement proceedings is domiciled in Switzerland. In determining infringement of foreign counterparts the court has to apply the respective foreign law. In other words, in determining whether a French patent (or the French part of a European patent) is infringed, the Swiss judge has to apply French patent law, etc. It is, therefore, more likely that a court will grant a cross-border or extra-territorial injunction in a dispute involving a European patent, given the significant degree of harmonisation of European patent law. Even then, judges will generally be reluctant to grant cross-border or extra-territorial injunctions. This is especially so in preliminary injunction proceedings.
If the defendant to infringement proceedings challenges the validity of the foreign patents, the judge still has jurisdiction over the dispute, but will only deal with the invalidity issue as a preliminary question (defence) to infringement. The invalidation of the foreign patent (by way of counterclaim) falls under the exclusive jurisdiction of the courts of the country in which the patent was issued.
2.7 To what extent do courts recognise the blocking effect of ‘torpedo’ actions abroad?
As a general rule, a Swiss court must stay proceedings, if there are already proceedings pending between the parties on the same subject matter before a foreign court. Where the alleged infringer has filed a ‘torpedo’ action for a declaratory judgment of non-infringement in a slow-moving jurisdiction and the patentee (or exclusive licensee) commences infringement proceedings in Switzerland in respect of the same patent, the Swiss court will generally stay the Swiss proceedings. Some authors argue that if the foreign court in which the ‘torpedo’ was filed clearly has no jurisdiction, the action before the foreign court constitutes an abuse of law and does not justify a stay of the Swiss proceedings. There is, however, no case law on the issue.
3.1 How is patent infringement assessed? To what extent does the doctrine of equivalents apply in an infringement action?
Determining whether a patent is infringed essentially involves two steps:
In construing a patent claim, Art 69 of the EPC is relevant (either directly in the case of a European patent or by way of analogy in the case of a Swiss patent). The extent of the protection conferred by a European patent or a European patent applications determined by the terms of the claims. Nevertheless, the description and drawings is used to interpret the claims. According to the Protocol on the Interpretation of Art 69, this article should not be interpreted in the sense that the extent of the protection is to be understood as defined by the strict, literal meaning of the wording used in the claims, the description and drawings being employed only for the purpose of resolving an ambiguity found in the claims. Nor should Art 69 be interpreted in the sense that the claims serve only as a guideline and that the actual protection conferred may extend to what, from a consideration of the description and drawings by a person skilled in the art, the patentee has contemplated. On the contrary, Art 69 is to be interpreted as defining a position between these extremes which combines a fair protection for the patentee with a reasonable degree of certainty for third parties. The prosecution file must generally not be used for claim construction.
The doctrine of equivalence also applies in infringement actions in Switzerland. In order to extend the scope of protection beyond the strict literal meaning of the words of the claim, due account is taken of any element which is equivalent to an element specified in that claim. The scope of protection conferred by a patent claim is, therefore, not limited to the identical use of the features of the construed claim by the accused product or process, but also extends to equivalent embodiments if the skilled person in the art is able to recognise the latter as being equally effective.
The alleged infringer may argue that the accused embodiment does not fall within the patent
claims if properly construed.
The alleged infringer may also challenge the validity of the patent.
Alternatively, the defendant may argue that the alleged infringing acts are exempted from patent infringement. Under Swiss law, the rights conferred by a patent do not extend to acts done privately for non-commercial purposes, acts done for experimental purposes, and use on ships, aircrafts, etc temporarily or accidentally entering Switzerland.
In addition, the alleged infringer may argue exhaustion of rights if the patented product or the product resulting from a patented process has been sold in Switzerland by the patentee or with the patentee’s consent (Switzerland adheres to the principle of national exhaustion). In the case of parallel importation of patented products from another country, the defence of antitrust violation may be available, albeit only in exceptional circumstances (as more fully explained in question 3.3. below).
The alleged infringer may further argue that he is entitled to a prior user right. This is only the case if the alleged infringer had already used or made all necessary preparations to use the invention claimed by the patent at the patent’s priority date.
Finally, the alleged infringer may argue that the patentee is estopped from enforcing an otherwise valid and infringed patent due to lapse of substantial time. This defence is, however, limited to rare cases where the patentee by his conduct has given the alleged infringer reasonable grounds to believe that he would not bring any claims for patent infringement. Mere inactivity of the patentee even for a long time is generally not sufficient.
If none of the above defences prove successful, the alleged infringer may argue that he is entitled to a compulsory licence. This may be the case if the alleged infringer himself has an invention which is dependent on the prior invention, if the prior invention is not exploited in Switzerland or if public interest requires a compulsory licence. The grant of a compulsory licence has to be requested in separate proceedings. In practice, it seems to be very difficult to obtain a compulsory licence. There is no reported decision of a court having granted a compulsory licence.
3.3 To what extent can enforcement of a patent expose the patent holder to liability for an antitrust violation?
The Federal Supreme Court has held that a patentee that has a market dominant position may be liable for an antitrust violation if he enforces his patent to prevent parallel importation of a patented product already sold in another country. This defence is, however, limited to cases where the patentee is market dominant, the legal and economic conditions of the country where the first sale occurred are comparable to those of Switzerland, and the enforcement of the patent only seeks to maintain substantially higher prices in Switzerland, thereby sealing off Switzerland in an abusive way.
Some authors argue that market dominant patentees are generally obliged to grant compulsory licences if the use of the patented technology is indispensable for a third party who wishes to offer new products and the patentee does not have legitimate grounds to refuse such grant of licence. The Patent Act specifically provides for compulsory licences in case of antitrust violations, but the issue is generally not settled in Switzerland.
Under the Patent Act, the court may revoke a patent on any of the following grounds:
3.5 Can a court only partially invalidate a patent? Can it transform the patent into a utility model?
Where the court determines that one of the grounds for invalidation has been established, but only so as to invalidate the patent to a limited extent, the court will only partially invalidate the patent.
There are no utility patents in Switzerland, and the court cannot transform a patent into a utility patent or a utility model.
It is possible for the patentee to amend the patent claims during a law suit, but they may only be restricted, ie not extended, since they must not add something new to the specification. The patent may be restricted by eliminating patent claims altogether or by combining independent patent claims and claims dependent thereon. Otherwise, patent claims may only be restricted if the restricted claims still relate to the same invention and are still supported by the description of the original application. This latter possibility of amending the patent claim is only available once and only when the amendment is sought within four years of grant.
3.7 Are there any grounds on which an otherwise valid patent can be deemed unenforceable, owing to misconduct by the patent holder, or for some other reason (eg expiry of time limit)?
A patent cannot be deemed unenforceable due to misconduct of the patentee. An otherwise valid and infringed patent can be deemed unenforceable owing to lapse of time only under exceptional circumstances, as more fully explained in question 3.2 above.
3.8 Can a patent holder bring a law suit claiming both patent infringement and unfair competition for the same set of facts?
In principle, a patent holder can bring a law suit claiming both patent infringement and unfair competition for the same set of facts. Some courts have considered the mere patent infringement to already constitute an act of unfair competition. However, it may also be that additional activities of the alleged infringer – separate from mere patent infringing activities (such as using a confusingly similar trade dress) – constitute acts of unfair competition, which may also be actionable in the same law suit.
4.1 Who can sue for patent infringement (patent holder, exclusive licensee, nonexclusive licensee, distributor)? Does a licensee need to be registered to sue?
Under Swiss law, the patentee and the exclusive licensee can sue for patent infringement. The exclusive licensee can only sue for patent infringement if the relevant licence agreement (expressly or implicitly) gives the exclusive licensee the right to sue for patent infringement. The bill designed to revise the Patent Act which is currently under discussion in Swiss Parliament provides that the exclusive licensee can generally sue for patent infringement unless the licence agreement specifically excludes it.
Non-exclusive licensees or distributors have no right to sue for patent infringement. In the circumstances, it is important for those non-exclusive licensees and distributors to stipulate in the relevant licence or distributorship agreement that the patentee should take action for patent infringement.
It is not necessary for exclusive licensees to register their rights before they have the right to sue.
4.2 Under what conditions, if any, can an alleged infringer bring a law suit to obtain a declaratory judgment on non-infringement?
Under Swiss law, an alleged infringer may bring a law suit to obtain a declaratory judgment that an act does not, or a proposed act would not, constitute an infringement of a patent, provided that he has a legitimate interest to obtain such judgment. This is usually the case if the alleged infringer has received a cease and desist letter or the patent holder has otherwise asserted that he infringes the patentee’s patent. If the patent holder has not yet given any indication that he considers the alleged infringer’s activities to constitute infringement, an alleged infringer is generally barred from bringing a law suit to obtain a declaratory judgment on non-infringement.
4.3 Who can be sued for patent infringement? Can the company directors be sued personally? Under what conditions, if any, can someone be sued for inducing or contributing to patent infringement by someone else?
Any person infringing a patent by himself, or through his agents, is potentially liable and may be made a defendant to proceedings.
Directors of a company would not normally be liable simply because their company has been engaged in infringing activities unless it can be proved that the directors have personally committed or directed the infringing acts or the company committed the infringements as their agent, or that they expressly authorised the same or that they were aware of the patent infringement and did not take steps to stop it. A company itself is liable for any acts committed by its directors and/or its employees in the course of their duties.
Any person inducing or contributing to a patent infringement is also potentially liable and may be made a defendant to proceedings. It also constitutes contributory infringement to supply (or to offer to supply) materials or parts which are suitable for putting and intended to put the invention into effect. This also applies to foreign contributors: The foreign supplier of materials or parts which are brought into Switzerland where manufacture is completed and, thus, the invention put into effect, may contribute to a patent infringement. Conversely, the Swiss supplier of materials or parts which are bought outside Switzerland does not assist to a patent infringement in Switzerland (but may contribute to a patent infringement of a foreign counterpart of such patent).
Under the applicable procedural law, it is generally no longer possible to add parties during litigation.
A (co-)plaintiff may, however, withdraw any particular claim made by him, as against any or all of the defendants.
5.1 What options are open to a patent holder when seeking to enforce its rights in your country?
The patent holder may enforce its rights by threatening or taking legal action. Typically, the patent holder initially sends a cease and desist letter asserting the patent infringement and requiring the alleged infringer immediately to cease to infringe and desist from future infringements, to disclose information about the supplier and the turnover and profits generated with the infringing product, to pay compensation for damages suffered by the patent holder (including reasonable attorneys fees) and to destroy remaining stock of infringing products.
If the patent holder seeks to enforce its rights in case of non-compliance, it can bring:
5.2 Are criminal proceedings available? If so, what are the sanctions?
Acts of intentional patent infringement are criminal offences in Switzerland. The sanctions are either a fine of up to CHF 100,000 or imprisonment up to one year.
The Patent Act does not explicitly provide for border measures for patents. Some authors suggest, however, that border measures are also available for patents by way of analogy to border measures available for trade marks, designs and copyrights. There is currently a bill under discussion which seeks to introduce border measures into the Patent Act. In practice, border measures do not seem to play any significant role in Switzerland in relation to patents.
5.4 To what extent are alternative dispute resolution (ADR) methods (such as arbitration or mediation) available to resolve patent disputes? If arbitration is available to assess invalidity, will your Patent Office recognise and execute an arbitral award declaring a patent invalid?
In principle, alternative dispute resolution (ADR) procedures, including mediation and arbitration, are available for determining disputes of patent infringement. In Switzerland, both patent infringement and invalidity disputes are considered arbitrable. However, ADR proceedings are rarely used in patent matters in Switzerland. In patent licence contracts, the parties can provide for disputes to be handled by arbitration, but this is unlikely to resolve patent infringement and validity issues.
An arbitral award declaring a patent invalid, will be recognised and enforced by the Swiss Patent Office in the same manner as a judgment or order to the same effect.
In some cantons, procedural law provides for mandatory conciliation or mediation hearings either prior to and/or during court proceedings where the parties are encouraged to resolve their disputes by way of court-mediated settlement negotiations.
Each canton has its own code of civil procedure and, accordingly, its own format of patent proceedings. However, some general principles emerge. To initiate court proceedings, the plaintiff files a statement of claim indicating what remedies he seeks against the defendant, presenting the facts and setting out the legal arguments. In some cantons, procedural law provides for a mandatory conciliation hearing prior to initiating court proceedings (as set out above in question 5.4). The defendant will then file a statement of defence and a counterclaim, if any, refuting the infringement claim and asserting invalidity.
In some cantons, procedural law provides for mandatory conciliation or mediation hearings after the first exchange of briefs where the parties are encouraged to resolve their disputes by way of court-mediated settlement negotiations. If the dispute cannot be resolved, the plaintiff will file the reply and defence to counterclaim, if any, followed by the rejoinder and reply to counterclaim to be filed by the defendant and, finally, the rejoinder to counterclaim to be filed by the plaintiff.
After the briefs have been exchanged, the judge will decide whether a court expert will be appointed, whether witnesses will be heard or other evidence taken. Oral hearings are used for hearing witnesses and/or instructing experts. Once the court-appointed expert has furnished his opinion, witnesses been heard and other evidence been taken, the parties will make observations on the results of the evidence taking – either in writing or at a final oral hearing. To the extent the expert evidence does not support the party’s position, it may request that the expert be asked to supplement his opinion or that the court appoint a new expert (which request is, however, only granted under exceptional circumstances).
Usually within a few weeks of the final oral hearing, the court will announce the decision.
All patent cases in Switzerland are tried and decided by judges alone and without a jury. There are usually three or five professional judges, depending on the applicable procedural law. The commercial courts of Zurich, St Gall, Argovie and Berne also have technical judges in addition to the professional judges. In preliminary injunction proceedings it is generally only the chief judge deciding as single judge.
6.3 To what extent are documents, affidavits, witnesses and/or (court-appointed or private) experts used? Is it possible to cross-examine witnesses?
(a) Documents
Patent proceedings are largely based on written documents (including correspondence between the parties, illustrations of the invention, prior art, drawings and pictures of the accused embodiment and leaflets and brochures establishing infringement, among others).
(b) Affidavits
Affidavits are not frequently used, but may sometimes be helpful in lieu of witnesses. Especially in preliminary injunction proceedings, the applicant sometimes files affidavit evidence in support of its application. It is not necessary (but sometimes advisable) for those persons who have made the affidavit to give evidence in the court.
(c) Witnesses
Witnesses are rarely used in patent infringement or validity proceedings. They may play a significant role in relation to claims to patent ownership. It is generally not possible to cross-examine witnesses as practiced in the Anglo-American legal system. In most cantons, the witnesses are questioned by the chief judge, but the parties are allowed to ask additional questions either directly to the witnesses or to read them out to the judge who will in turn question the witnesses.
(d) Private expert opinions
Opinions of private experts are sometimes used in support of specific allegations (relating, for instance, to infringement and validity issues or damage calculation). If a court comes to the conclusion that expert advice is required or the parties have made such request, the court will normally appoint a court expert. Private expert opinions may still be important to the extent that they provide guidance to the court-appointed expert.
(e) Court-appointed expert
In Switzerland, the court would normally appoint an expert to give evidence. Court-appointed experts, therefore, play a significant role in patent proceedings in Switzerland. In the commercial courts of Zurich, St Gall, Argovie and Berne, technical judges would normally provide expert advice to judges in technical matters, but in more complex cases even the commercial courts would appoint external court experts.
6.4 To what extent is pre-trial discovery permitted? If it is permitted, how is discovery conducted? If it is not permitted, what other, if any, mechanisms are available for obtaining evidence from an adverse party or from third parties?
Pre-trial discovery is only permitted to a limited extent. A party may file a request for production of documents with the court if the following requirements are fulfilled:
In addition, if evidence is likely to be destroyed or abandoned a party may request a judge to order the provisional seizure of such evidence. The procedural requirements are, however, stringent, and the seized evidence is only made available to the party requesting the seizure once the pleadings are finished and only to the extent necessary. Typically, if a patent holder does not have sufficient knowledge of the infringing goods and is, therefore, not in a position to substantiate a patent infringement claim, a request for the provisional seizure of such infringing goods will be rejected.
6.5 What level of proof is required for establishing infringement or invalidity?
The court must be convinced that the patent is infringed or invalid, as the case may be.
6.6 How long do patent infringement proceedings typically last? Is it possible to expedite this process?
The length of patent infringement proceedings depends on the complexity of the patent in question, the number of patents and/or patent claims infringed and the number of defences raised. Patent infringement proceedings may generally be concluded in 18 months to three years, but it can take longer in cases involving complex technology. Expediting the process is only possible to a limited extent because the court controls the conduct of the proceedings.
6.7 What options, if any, are available to a defendant seeking to delay the proceedings? Under what conditions, if any, can proceedings be stayed? How can a plaintiff counter delaying tactics of defendant?
The defendant may try to delay the proceedings by requesting certain preliminary judgments regarding jurisdiction, forfeiture, etc. The defendant may also seek repeated extensions of time for compliance with Court deadlines. In some cantons only two or three time extensions are permissible. In other cantons, extensions are repeatedly granted, until it becomes clear to the court that the defendant is simply engaging in delaying tactics.
The plaintiff can try to resist all such applications. This may, however, be difficult since the court controls the conduct of the proceedings.
7.1 What remedies are available against a patent infringer (final injunction, delivery up or destruction of infringing goods, publication of the decision, recall-order, monetary remedies, etc)?
Under the Patent Act, the patentee may seek the following relief against a patent infringer:
7.2 To the extent it is possible to obtain a final injunction against future infringement, is it effective against the infringer’s suppliers or consumers?
It is possible for the plaintiff to obtain a final injunction against the defendant, whether acting by itself, its directors, officers, employees, servants, agents, representatives, nominees or associates or related companies or subsidiaries etc, from infringing the patent in question. Unless the infringer’s suppliers or consumers are parties to the proceedings, the court would not impose an injunction against them.
7.3 What monetary remedies are available against a patent infringer (reasonable royalty, lost profits, account of profits, or some other basis)? Are punitive damages available? If so, under what conditions?
Overview
Similar to common tort actions, monetary remedies in patent actions are assessed on the basis that the plaintiff should be placed in the position in which he would have been if no infringement had occurred. The plaintiff may either request compensation (damages) for the pecuniary loss that it has suffered from the infringement or require the defendant to surrender the profits made as a result of the sale of the infringing products (account of profits). Where the plaintiff is entitled to damages, he may request either compensation of lost profits or a reasonable royalty rate. According to a recent decision of the Federal Supreme Court, damages are only available where the plaintiff has exploited or licensed his patent. If the plaintiff has not exploited or licensed his patent, only an account of the profits derived by the defendant is available. Where the plaintiff is entitled to damages or an account of profits, he must make an election. The court will not, in respect of the same infringement, award both damages and an account of profits. Usually, the plaintiff will pursue both remedies in parallel as alternative claims and take one remedy over the other at the end on the basis of whichever yields the better result.
In addition to either seeking damages or account of profits the plaintiff is also entitled to seek damages for ancillary losses arising from the infringement. Such ancillary losses may include legal expenses incurred prior to initiating the action (eg the cost of an infringement opinion by outside patent counsel), expenses directed at mitigating the impact of the infringement (eg advertising expenses directed at minimising confusion in the market place) or lost sales of ancillary products (eg lost sales of unpatented equipment, spare parts, etc which the patentee ordinarily sells alongside its patented articles).
Lost profits
Lost profits are those profits the patent holder would have made absent the patent infringement. The lost-profit award relies on decreased sales, eroded prices or increased expenses of the patented goods or goods produced by a patented process as a result of the infringement.
Reasonable royalty
The calculation of damages may also be based on a reasonable licence fee the plaintiff would have received had the defendant entered into a licensing agreement with the plaintiff. If an established royalty rate exists (because the patentee has widely applied it in numerous licensing agreements), this rate may be used as reference value. If no such established royalty rate exists, one needs to determine a hypothetical royalty rate that the patentee/licensor and the infringer/licensee (both hypothetically willing) would have agreed upon (at the time infringement began) if both had been reasonably and voluntarily trying to reach an agreement.
Account of profits
Alternatively, the plaintiff is entitled to the profits generated by the defendant due to the infringement (rather than profits lost by the patentee).
Punitive damages
The Patent Act does not provide for punitive damages. The Federal Supreme Court has recently found that punitive damages are contrary to Swiss ordre public.
8.1 Is preliminary relief available? If so, what preliminary measures are available (eg preliminary injunction) and under what conditions?
Preliminary relief is available in the form of a preliminary injunction. The requirements are as follows:
8.2 Is ex parte relief available where defendant is given no notice at all? If so, under what conditions?
In cases of urgency and where there is a strong prima facie case of infringement, an application can in principle be made to the court for ex parte injunction. The application is made without notice to the defendant. In practice, however, ex parte injunctions in patent matters are almost never granted.
In cases where the action is started by an ex parte application, it requires confirmation in inter partes proceedings.
8.3 Is plaintiff entitled to ask for an order that defendant’s premises are searched and a description of the infringing goods (and the accounting relating thereto) is made in order to establish proof of infringement (saisie-contrefaçon)? If not, what other mechanisms, if any, are available for seizing and preserving evidence for trial?
There is generally no saisie-contrefaçon or other mechanism in Switzerland to establish proof of infringement. Under exceptional circumstances, some mechanisms are available for seizing and preserving evidence. For instance, if evidence is likely to be destroyed or abandoned a party may request a judge to order the provisional seizure of such evidence. The procedural requirements are, however, stringent, and the seized evidence is only made available to the party requesting the seizure once the pleadings are finished and only to the extent necessary. Typically, if a patent holder does not have sufficient knowledge of the infringing goods and is, therefore, not in a position to substantiate a patent infringement claim, a request for the provisional seizure of such infringing goods will be rejected.
8.4 Can the defendant put the validity of a patent in issue in preliminary injunction proceedings?
Yes, the defendant can put the validity of a patent in issue by way of defence. If the defendant can satisfy the court that there is a serious question on the validity of the patent to the extent that there is no prima facie case of patent infringement, the defendant may be able to defeat the plaintiff’s application for preliminary injunction.
Each canton has its own format of preliminary injunction proceedings. However, some general principles emerge: To initiate court proceedings, the plaintiff files a request for a preliminary injunction against the defendant, presenting the facts and setting out the legal arguments. The defendant will then file a statement of defence refuting the infringement claim and irreparable harm and asserting invalidity as defence.
In some cantons, procedural law provides for oral hearings after the first exchange of briefs where the parties are given the opportunity to plead orally (reply and rejoinder). The court then presents a preliminary view of the case to encourage the parties to resolve their dispute by way of court-mediated settlement negotiations. If the dispute cannot be resolved, the court will either take an immediate decision or appoint a court expert.
Alternatively, there is no oral hearing and parties submit reply and rejoinder in writing. The court then again either takes an immediate decision or appoints a court expert.
Once the court-appointed expert has furnished his opinion, parties will make observations on the opinion. To the extent the expert evidence does not support the party’s position, it may request that the expert be asked to supplement his opinion or that the court appoint a new expert (which request is, however, only granted under exceptional circumstances). The court then takes a decision.
8.6 To what extent are documents, affidavits, witnesses, and/or (court-appointed or private) experts used in preliminary injunction proceedings?
(a) Documents
Preliminary injunction proceedings are also largely based on written documents.
(b) Affidavits
Affidavits are especially helpful in preliminary injunction proceedings in lieu of witnesses. The applicant sometimes files affidavit evidence in support of its application. In preliminary injunction proceedings it is generally not possible for those persons who have made the affidavit to give evidence in the court.
(c) Witnesses
Witnesses are generally not used in preliminary injunction proceedings. In most cantons, witnesses are not even permissible means of evidence in preliminary injunction proceedings.
(d) Private expert opinions
Opinions of private experts are sometimes used in support of specific allegations (as more fully explained above under question 6.3). If the judge comes to the conclusion that expert advice is required or the parties have made such request, the judge will normally appoint a court expert. Private expert opinions may still be important to the extent that they provide guidance to the court-appointed expert.
(e) Court-appointed expert
In Switzerland, the court would normally appoint an expert to give evidence. Court-appointed experts, therefore, play a significant role even in preliminary injunction proceedings in Switzerland.
8.7 What level of proof is required for establishing infringement or invalidity in preliminary injunction proceedings?
The plaintiff has the burden of proving that there is a prima facie case of infringement, and irreparable harm. The defendant has the burden of proving that there is a prima facie case of invalidity.
The length of preliminary injunction proceedings again depends on the complexity of the circumstances, but also on whether a court expert is appointed. Preliminary injunction proceedings may generally be concluded in 8 to 18 months, but it can take longer in cases involving complex technology.
8.9 Where a preliminary injunction is granted, is it necessary to start main proceedings to confirm the preliminary injunction?
Yes, within 30 days.
9.1 What avenues of appeal are available for a defeated party in main proceedings or preliminary injunction proceedings? Under what conditions?
The defeated party in any main proceedings may file an appeal against the decision of the cantonal court to the Federal Supreme Court. The appeal is limited to a review of legal issues (as opposed to facts). More specifically, the appellant has to show that the first instance court misapplied or misinterpreted federal law, ie patent law.
For violations of procedural (cantonal) law and arbitrary assessment of the facts a constitutional appeal has to be filed instead. This special appeal is filed with the Federal Supreme Court except in the cantons of St Gall and Zurich where a separate constitutional appeal first has to be filed with a special cantonal court of cassation before lodging a constitutional appeal with the Federal Supreme Court.
In preliminary injunction proceedings no ordinary appeal is available; the defeated party may only file a constitutional appeal to the Federal Supreme Court except in the cantons of St Gall and Zurich where again a separate constitutional appeal first has to be filed with a special cantonal court of cassation. As a result, the review of legal questions in preliminary injunction proceedings is basically limited to arbitrary or manifestly wrong application of the law.
9.2 How long do appeal proceedings typically last?
Depending on the nature of the appeal, and the availability of the court, an appeal can take three to eight months.
10. LITIGATION COSTS
10.1 What level of cost should one expect to incur to take a case through to a first instance decision, preliminary injunction proceedings and/or appeal proceedings?
There are three types of costs involved in patent litigation:
Court costs are dependent on the value of litigation. Both attorney’s and (external) patent agent costs are generally charged on a time-costing basis, but are adjusted to reflect other factors such as complexity of dispute and value of litigation.
On average, a party should expect to incur between €50,000 and €150,000 to take a case through to a first instance decision. The court awards attorneys’ fees to the prevailing party (recoverable from the losing party), but such awards generally do not fully cover the required level of costs (as more fully explained hereafter under question 10.2). Court costs have to be paid by the losing party.
10.2 Are costs recoverable from the losing party?
Generally, the successful party may recover their legal costs and disbursements from the other party, which, after assessment by the court, is usually about 50–60% of the legal costs and all disbursements actually incurred by the successful party in the proceedings.
The court may exceptionally refuse to make a costs order in favour of the winning party, or may penalise them, if they have abused the process of the court or in other ways contributed to the delay of the proceedings.
11.1 What are the important developing and emerging trends in your country’s patent law?
One important trend is that the patent system suffers from increasing criticism, in particular in relation to biotechnological, medical or software related inventions. While Swiss legislators generally seek to provide an adequate regulatory framework for protecting such inventions, there is an increasing tendency to propose additional exemptions to patent infringement, such as a farmer’s privilege, compulsory licensing for research tools or diagnostic methods, Bolar-type exemptions, etc. The Patent Act is currently under revision, and it is not yet clear which of the proposed exemptions will eventually be included in the Patent Act.
11.2 To the extent it relates to patent enforcement, please outline any major patent legislation in the pipeline.
There are currently a number of bills under discussion in Switzerland which relate to patent enforcement. One of them seeks to create a unified system of civil procedure for all of Switzerland. Another bill which is designed to revise the Patent Act seeks to codify the exclusive licensee’s right to sue and to put foreign patentees on a par with Swiss patentees in relation to forum shopping against Swiss infringers. The third bill currently under discussion in Switzerland aims to create one specialist federal patent court for all of Switzerland.
12. USEFUL REFERENCES
12.1 Please identify any useful works of reference relating to patent
law and patent litigation in your country including useful websites
www.admin.ch (website of the Swiss government)
www.bger.ch (website of the Swiss Federal Supreme Court)
www.ige.ch (website of the Swiss Federal Institute for Intellectual Property)
www.wipo.org (website of the World Intellectual Property Organisation)
www.wto.org (website of the World Trade Organization)
www.european-patent-office.org (website of the European Patent Office)
sic!, Review of Intellectual Property, Information and Competition Law
von Büren/David Patent Law (2006) (in German)
Bertschinger/Münch/Geiser Swiss and European Patent Law (2002) (in German)
Heinrich Commentary on the Swiss Patent Act (1998) (in German)
von Büren/David Enforcing Intellectual Property Rights (2nd ed, 1998) (in German)
works of reference from Germany (including Benkard Commentary on the German Patent Act
(10th ed, 2006); Schulte Commentary on the German Patent Act (7th ed, 2005); Busse Commentary
on the German Patent Act (6th ed, 2003) among others) are generally useful in Switzerland.
