The nullity of a European patent for the absence of novelty and the right to stop paying royalties to the licensor

  1. A European patent can be declared null when a counter-interested party claims the absence of novelty due the previous publication of a patent and when the two patents result to be essentially identical
  2. A party can claim the nullity of a license agreement concerning the usage of a patent and then legitimately refuse to pay royalties to the licensor when the licensee demonstrates that no valuable consideration was present in the same license agreement.
  1. If a European patent lacks the requisites of novelty, because its application was filed after the publication of a “thoroughly similar” national (Italian) patent,, then the European patent is likely to be declared null on initiative of any interested person.
  2. On the basis of the nullity of the European patent, the licensee can raise the issue of nullity of the license agreement for the lack of consideration in regarding with both the machine and the “claims” accompanying European patent’s application. The licensee seems then allowed not to pay the royalties requested by the licensor.

Under section 46 of the Italian Code of Industrial Property (CPI), a patent must detain the requisite of novelty. An invention is novel if it does not yet form “part of the state of the art” meaning everything “available to the public by means of a written or oral description, by use, or in any other way.” The following paragraph 3 provides that the “state of the art” comprises the content of previous applications for (Italian or European) patents published even on the date of filing of the new applications or later. The industrial invention, in order to be protected, needs to be based on

the solution of a technical problem, not yet solved, aimed to have tangible uses in the industrial field, so to bring a development to the pre-existent technologies and cognitions (extrinsic novelty) and to express a creative activity of the inventor, that is not the simple execution of already known ideas … (intrinsic novelty)

(Soc. Manifattura Plastica C. vs. Soc. Rosa Plast, Cass. Civ., sez. I, 14.10.09, n. 21835, in Riv. dir. ind. 2010, 4-5, II, 391). On the other hand, a patent may be considered null if the licensor was not entitled to the patent (Section 76 CPI). This happens when the invention is not patentable lacking, among others, the requisites provided at article 46 of the CPI and therefore the elements of novelty.

Since a European Patent does not entitle to exclusive rights per se, being it a “bunch” of national patents, any of the judges of the EU members shall verify, under the laws of his or her country, the validity of the challenged patent. Id.

From a contractual standpoint, the invalidation of a patent has retroactive effects, but does not prejudice “the contracts…signed before the judgment which declared the nullity in so far as they have been already performed.” Nonetheless, under Italian Civil Code a contract is null and void if it is not characterized by valuable consideration (sections 1418 and 1325).

In addition, Section 68 of the CPI states that a business which used an invention for the 12-month period before the application of the relative patent can follow using the invention “within the limits of the prior usage.”