Regulation & Law

Till Lampel (Harmsen Utescher): “Companies need to rethink their filing strategy after Brexit”

Till Lampel, a seasoned partner of a long-standing German IP firm, Harmsen Utescher, analyses in depth four new challenges faced by his clients, including legal cost control, Brexit, internet and globalization, and decodes the advantage of Germany in terms of litigation.

© HARMSEN UTESCHER

Till Lampel, a seasoned partner of a long-standing German IP firm, Harmsen Utescher, analyses in depth four new challenges faced by his clients, including legal cost control, Brexit, internet and globalization, and decodes the advantage of Germany in terms of litigation.


Leaders League. What new challenges do your clients face?

Till Lampel. From my experience, I have identified four challenges faced by our clients.

First of all, since the beginning of 2000s and particularly after the economic crisis in 2008, our clients pay much more attention to legal costs, and this trend is getting stronger. For instance, they are now more hesitant to litigate because of litigation costs concerns, and they would ask before they instruct law firms to start work.

Secondly, Brexit’s impact on unitary patent & the Unified Patent Court and trademarks is not negligible.

Thirdly, the internet, especially social media, is always an issue for our clients, in the areas of trademark, designs, unfair competition, etc.

Last but not least, globalization. In the past our clients, including some very big businesses, were only interested in the German market; since late 90s, they started to target foreign markets and protect their IP rights abroad, which were linked to the introduction of EU trademark in 1996; nowadays they extend outside of the EU to the USA, China, Brazil, Africa, Japan, India, and so on.

 

Leaders League. How does your firm handle cost pressure from clients?

T.L. Legal costs have always been a topic that every law firm has to look at, so do we. We try to be competitive not only in quality but also in price. Our quality has already been certificated by different rankings and client referrals; on the cost side, as an IP boutique we are by nature more cost effective than big full service law firms, and we always try to keep costs stable while maintaining quality through technology or human resources, and avoid unnecessary costs. For instance, we have built an agile IT system to digitalize documentation and provide online support to our clients so that they can consult files at distance at any time. We also try to rationalize labor cost and do things electronically, and make the cost saving visible on our billings.

 

Leaders League. What is the impact of Brexit on the trademark side?

T.L. From my point of view, the first big impact is that companies now need to rethink their filling strategy. In the past, a German company doing business in the UK could simply file an EU trademark and be done with it; after Brexit, the EU trademark could lose its value in the UK, or not, depending on the contract a company holds.

A more serious problem comes up when a company only uses its trademark in the UK, as the law establishes that an EU trademark must be put to genuine use in the European Union in the five years following its registration. In other words, if a company uses the trademark for five years in the UK, then it doesn’t have an EU trademark that is used in Europe, so its rights risk being revoked in Europe. Therefore the filling strategy from now on could be filing a UK nationwide trademark if a company doesn’t need protection in Europe, or a UK trademark plus an EU one for wider use.

 

Leaders League. How does this new situation impact European firms’ work?

T.L. Although Brexit is not good for Europe, even if commercially we need to react to it with a positive point of view, it presents an opportunity for continental firms. Many American firms used to file EU trademarks through their colleagues in the UK because of the shared language, but it may not be possible any more after Brexit, and I would even recommend foreign clients  move to European firms, who in addition are not as expensive as UK firms but provide the same standards of service  in trademark filling.

At our firm, we have already received many questions from foreign clients regarding how to evaluate the situation after Brexit. It’s not generating concrete work for us yet, since the timing of Brexit isn’t clear, so making a move doesn’t make sense for the moment. It’s great that UK has accepted the validity of unitary patent/UPC but on the trademark side, for the time being we advise our clients just to stay calm and think about where their trademark will be used before making a decision sometime next year.

 

Leaders League. How do you advise your clients when it comes to managing their global trademark portfolio?

T.L. I always advise my clients to think thoroughly, before product introduction, where they are producing and selling now and where they intend to produce and sell in the long run. I’d first suggest they take into consideration the countries where they want to immediately file trademarks, then carry out EU trademark filing through EUIPO (European Union Intellectual Property Office) or international registration through WIPO (World Intellectual Property Organization). I wouldn’t advocate a blind global filing, but rather strategic thinking and targeting: where is your market? Where are you selling now? Where do you wish to sell? And where do you produce?

Other factors also need to be taken into account: depending on the market, you may need to think about where your fiercest competitors are, as you certainly won’t wish them to file your trademarks. And I also take different approaches depending on whether it’s a big company with a competent legal department or a small structure without any in-house professionals: It’s more the latter kind I need to educate and tell what to do.

 

Leaders League. What have been the recent legislative innovations in Germany in the domain of IP?

T.L. Germany has already amended patent law in relation to the UPC, and we are currently amending the trademark law in relation to the EU trademark directive, expected to pass through before the election next summer.

Although there are not huge changes, the new trademark law would render the process quicker and more efficient. For instance, filing a scent trademark might become possible under the new legislation; on the cross border side, it could be possible to seize the products in Europe even if the products only infringe trademark rights of the sender country, not of EU.

 

Leaders League. What are the “German advantages” in IP litigation?

T.L. On the European scene, Germany has a very efficient jurisdiction: it is independent, predictable, fast and cost effective.

Compared to Scandinavia, the Netherlands, Italy and France where I litigate a lot, Germany is much less costly. We have no unpredictable cost risks through pre-trial discovery procedures, lawyer fees are transparent and affordable because of the law regulating attorney fees to avoid unknown risks for clients, and in Germany the victorious plaintiff can recover his or her total litigation expenses and attorney fees.

We have specialized judges, a speedy system from the court in relation to injunctive relief, fast-track enforcement for IP rights, as well as the most important European patent court in Dusseldorf. We also have ex-parte injunctions in some courts, so that clients can test waters without notice to the other party, which is helpful in many cases.

As a result of the numerous advantages, I always advise my foreign clients who want to sue in the EU to choose Germany.

 

 

Jeanne Yizhen Yin

 

Read the full Special Report: Germany: The Power of Diversification

The economic landscape and working practices make this market totally atypical and complex, but the country still has a lot to offer. More than ten years after the arrival en masse of the British and American law firms, Germany is weighing its options and heading for greater stability.
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