An International Guide to
Patent Case Management for Judges

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5.7.7 Costs

In Germany, the court costs for infringement proceedings as well as for invalidity proceedings are determined according to the value in dispute. Determination of the value in dispute

The determination of the value in dispute in Germany is at the equitable discretion of the court, Section 3 Code of Civil Procedure, res. Section 51 (1) Court Costs Act (Gerichtskostengesetz, GKG). The amount in dispute shall at first be determined provisionally without hearing the parties and then finally after the conclusion of the proceedings and hearing of the parties. For this reason the statement of claim is to provide information on the value of the subject matter of the litigation wherever such subject matter does not consist of a specific amount of money (Section 253 (3) No. 2 Code of Civil Procedure). This is the case in patent infringement cases where the claimant typically seeks injunctive relief, rendering of accounts, recall/destruction and declaratory entitlement to damages. Where the claimant files these requests, the value of each request has to be determined separately in case separate enforcement of these requests is intended. The request for injunctive relief usually makes up for 80 % of the total sum in dispute and moreover serves as a point of reference to set the value of the other requests. In setting the value for permanent injunctive relief, the court has to make a reasonable prognosis by which the future value of the patent right for the claimant as well as the risk that the monetary realization of such value is endangered by the allegedly infringing act is to be assessed.167 Elements to be taken into account are the importance of the protected invention, the remaining time of protection, the future risk put at the realization of the monetary value of the invention by the allegedly infringing acts, which may best be assessed on the basis of the unjustified past use, the economic force of claimant and defendant, like existing streams of distribution and manufacturing possibilities, as well as the degree of fault (intent or (gross) negligence) on the side of the defendant.168 The market value of the patent is of particular importance in determining the amount in dispute. A valuation method for determining the market value is, in particular, the exploitation interest, which can be determined by the possible license fees. To determine potential license rates, there are, for example, catalogues of license fees typical for certain industries. In most cases, the courts will – for lack of better sources of information and knowledge – adopt the sum in dispute as indicated in the statement of claim as long there is mutual consent between the parties that this value adequately reflects the true value of the dispute, except where such sum obviously is set too low. As a rule of thumb the value of small patent infringement cases regularly is set to EUR 250,000–500,000, to EUR 1,000,000–5,000,000, in medium and to more than EUR 10,000,000 in large cases (with a statutory ceiling set at EUR 30,000,000).

For nullity proceedings, a higher amount in dispute is assessed than for infringement proceedings concerning the same patent in dispute. When determining the amount in dispute in nullity proceedings, the FCJ adds a surcharge of 25% to the amount in dispute in the patent infringement proceeding. This is justified by the fact that the infringement action does not yet include the patent owner’s interest in using the patent for its own purposes for the remaining lifetime of the patent.169 Calculation of statutory court fees

The Court Costs Act and the corresponding schedule of costs included in an Annex are the relevant law to determine the concrete court fees, which have to be paid in advance to have the claim served on the opponent (Section 12 (1) Court Costs Act). A table of fees determines the amount of the single court fee (1.0) for certain values in dispute. The fee only increases if there is a jump in value. For amounts in dispute of EUR 500,000 or more, these jumps in value occur each time the amount in dispute is increased by EUR 50,000.

Depending on the type of proceedings or the instance, the multiplication factor for the calculation of the fee amount varies. Thus, for infringement proceedings in the first instance a 3-fold fee must be paid, in the second instance a 4-fold fee. For a nullity action, the court fees amount to a 4.5-fold fee in the first instance and a 6.0-fold fee in the second instance.

The court costs are to be paid by the plaintiff in advance and are fully refundable, if the plaintiff is successful. Reimbursable lawyer’s and patent lawyer’s fees

The reimbursable lawyer’s fees are the statutory minimum fees for a party’s own counsel, which at the same time correspond to what has to be reimbursed to the other side in case of loss. They as well depend on the value in dispute. Higher legal fees that have been agreed upon between client and lawyer that were actually incurred are not recoverable. Most specialized patent lawyers charge more than the statutory minimum fee, so that even the prevailing party has a certain non-refundable cost burden.

The German Lawyers’ Fees Act (Rechtsanwaltsvergütungsgesetz, RVG) applies to the calculation of recoverable lawyers’ fees in Germany. This is completed by the schedule of fees to the RVG. The simple lawyer’s fee (1.0) is determined in exactly the same way as the court fee, on the basis of a table of amounts in dispute. Also in this respect, the fees are leveled in steps of 50,000 (starting at EUR 500,000). The Act stipulates that a fee of 1.3 (or 1.6 in the second instance) can be charged for legal services in a case, and if court hearings take place in the case, an additional fee of 1.2 can be charged.

The German Lawyers’ Fees Act is not only applicable to determine the attorney’s fees, but also to the patent attorney’s fees. Due to the close cooperation of attorneys-at-law and patent attorneys in infringement actions and nullity actions, both attorney’s fees and patent attorney’s fees are recoverable in each type of proceedings (see Section 143 (3) Patent Act). The only requirement is that the cooperation was indicated in each case. However, the Court of Justice of the European Union (CJEU) recently held in a trademark case that the fees of a patent attorney only have to be reimbursed where these costs incurred by the successful party are reasonable and proportionate, which has to be decided in taking the specific characteristics of the case into due account.170 Whereas in trademark cases there may be circumstances where a patent lawyer’s involvement is not necessary in this sense, the patent lawyer’s technical expertise will be unavoidable and therefore refundable in most patent cases. Conversely, it is established case law that the involvement of a lawyer in nullity proceedings is necessary, if there is a simultaneously pending infringement proceeding concerning the patent-in-suit between the identical parties. Cost Example

For a typical patent infringement case where the sum in dispute is set to EUR 1,000,000 and where there is one party on each side the costs according to the above mentioned cost regulations (without costs of taking evidence, translation costs, costs for travel arrangements etc.) are as follows:

Regional Court Higher Regional Court Federal Court of Justice
Court fees 17,643 23,524 29,405
Lawyer Cl. 15,461.08 17,313.55 23,488.46
Lawyer Def. 15,461.08 17,313.55 23,488.46
Patent Att. Cl. 15,461.08 17,313.55 23,488.46
Patent Att. Def. 15,461.08 17,313.55 23,488.46
79,487.32 92,778.2 123,358.84
Total: 295,624.36 €

The respective costs for nullity proceedings before the German Patent Court and the FCJ, which are initiated by most defendants in response to an infringement action, will have to be added.