Patents and SMEs. Managing intimidation activities from financial strong actors

Sammanfattning: The problems technology based Small and Medium sized Entities (SMEs) face in their daily business´ regarding intimidation actions performed by financially stronger parties affect their business development activities. This is especially true for SMEs building their business from intellectual assets (IA) and intellectual property (IPR), such as patents, trademark, copyright, knowhow, databases etc. Financial strong actors have the ability to pin down SMEs by using litigation actions and by that get SMEs and their technologies stuck in court. Unfortunately, due to a weak and uncertain European patent system there are benefits for a large financial strong actor to perform intimidation strategies in order to gain competitive advantage. The current patent system contributes to a fragmentation of the European market which greatly challenges the possibilities of having the European market as the most competitive in the world. The thesis aims at setting out the key issues in order to reach satisfactory options and to shed light on the situation at hand To have a reasonable scope the thesis deals with SMEs on the European market facing infringement of their patents from financial strong actors. In the past there have been suggestions regarding how to deal with this issue. The thesis will go through a selected number of alternatives such as the development of patent litigation insurance schemes (PLI) on a European level and also the concept of patent defence uniom (PDU). These options mainly focus on, or have at least in the past, the need for financial aid. However, the costs of litigation are only part of the problem. Due to the current European patent system it has been extremely hard to make correct risk assessments, calculate costs, is it worth to patenting certain technologies etc. The patent system is seen as unreliable and therefore companies on the market seek for solutions outside the system. To investigate the matter further an analysis regarding the dispute resolution mechanisms litigation, arbitration and mediation was initiated. Since both the alternatives PLI and PDU have litigation as their primary resolution mechanism it is of interest to find out if there are any advantages to use alternative resolution procedures in relation to these concepts. The dispute resolution mechanisms have also been investigated in the light of both the current European patent system and the progress of a unitary EU level patent. The work is foremost based on information from reports presented or ordered from the EU Commission and national authorities within the EU member states. Unavoidable, there is first and foremost a need for a reliable and efficient European patent system. SMEs would greatly benefit from that and would also be able to stand up against large actors threatening with intimidation activities. Most likely there will no need for constructions such as PLI and PDU, at least from this perspective. In the long run the global welfare will decrease when business development activities can blossom at all levels on the European market. Let´s not forget that there are competing markets that offer an efficient market climate and by that forces European industry to move elsewhere.