This country-specific Q&A provides an overview of Patent Litigation laws and regulations applicable in Ecuador.
What is the forum for the conduct of patent litigation?
The Administrative Court and the Civil Judges have jurisdiction regarding intellectual property matters in Ecuador, but none of them have specialist patents or technical judges. The competence of each case is determined by the INGENIOS CODE. The Administrative Court judges are competent when there is a challenge to an administrative resolution that took effect, and the Civil Judges are competent when actions are filed against a third party that has allegedly infringed recognized intellectual property rights.
What is the typical timeline and form of first instance patent litigation proceedings?
Lawsuits filed before Civil or Administrative Court judges are usually dismissed or acknowledged in a period of approximately one month. Those that are acknowledged by the Administrative Court judges will be resolved in two hearings; but those acknowledged by the civil judges will be resolved in a single hearing. Therefore, time of judgment depends on the dates in which the judges decide to hold those hearings, which vary from two to twelve months from the time they acknowledge the lawsuit or since the first hearing.
Judgements made by the Administrative Courts can be challenged by means of an extraordinary appeal of cassation, which are usually admitted or denied in a period of two to twelve months. Those admitted are usually resolved in an additional period of six to eighteen months.
On the other hand, judgements made by the Civil Courts can be appealed before the Provincial Courts, which usually resolve these in a period of one to eight months. However, the judgements made by the Provincial Courts can also be challenged by means of a cassation appeal.
Can interim and final decisions in patent cases be appealed?
The interim and final decisions made by the judges of the Administrative Court cannot be appealed, but those made by the Civil Judges can be appealed. Appeals must be filed during the hearing and are resolved by the respective Provincial Courts. No permission is required to appeal. When appealed, the first instance decisions are still pending.
As stated previously, judgements made by the Administrative Courts can only be challenged by means of an extraordinary appeal of cassation.
Which acts constitute direct patent infringement?
When a product is claimed in a patent, and when a third party, without authorization from the patent owner, manufactures the product, offers it for sale, sells or uses said product, or imports it for any of these purposes, this is considered a direct act of patent infringement.
When a procedure is claimed in a patent, any acts that use the procedure or perform any of the acts previously described are considered direct patent infringements.
Do the concepts of indirect patent infringement or contributory infringement exist? If, so what are the elements of such forms of infringement?
The concepts of indirect patent infringement or contributory infringement do not exist in the Andean Community; therefore, they do not exist in Ecuador, either.
How is the scope of protection of patent claims construed?
The scope of protection conferred by the patent shall be determined by the wording of the claims, the description, the drawings, or, in certain cases, the biological material deposited, will be used to interpret this issue. Usually, claims are presented in accordance with the Andean Patent Manual, which states the following: “Claims may be independent or dependent. A claim shall be independent when it defines the subject matter to be protected, without reference to a previous claim. A claim will be dependent when it defines the matter to be protected by referring to a previous claim. A claim that refers to two or more previous claims will be considered a multiple dependent claim. Claims are the most important part of the application, as they define the invention to be protected and define the scope of that protection. It is essential that they be clear and concise so that: i) it can be compared and differentiated from the state of the art in order to verify the patentability requirements; and ii) can unambiguously determine the extent of the rights of the patent owner. The requirement of clarity and conciseness applies to each claim individually, as well as to all claims.”
What are the key defences to patent infringement?
The main factor in defending patent infringement is evidence, especially expert reports that validate the unauthorized use of the patent, and samples of the infringing product.
What are the key grounds of patent invalidity?
Patents need to be novel, inventive, and capable of industrial application. If the lack of one of these requirements is proved, the absolute nullity of the patent registration may be requested and conceded. Furthermore, invalidity may be requested if the object of the patent does not constitute an invention; if the patent had been granted for an invention that is not patentable; if the patent does not sufficiently explain the invention; if the claims included in the patent were not entirely supported by the description; and if the patent granted contained an extensive disclosure than the initial application, and this implies a protection extension.
How is prior art considered in the context of an invalidity action?
Once the analysis of the claims, the description and the drawings has been carried out, and the subject of the invention has been understood, the examiner must determine the state of the art. To determine whether an invention is novel, having already determined the state of the art, the following steps must be taken: an element-by-element comparison between what is in the state of the art and the proposed solution, which must be carried out first by comparing the independent claim with the entire content of each publication or other disclosure, taken in isolation; a comparison if whether the claimed invention is identical to what is disclosed in the state of the art; if the matter by itself contains all the characteristics of the claim analyzed, it is not considered new; a consideration within the state of the art, the content of a patent application pending before the national office whose filing or priority date is prior to the filing or priority date of the application being studied, always before said content is included in the request of the previous date when it was published; and, If the invention is included in the state of the art, it will not be patentable.
Can a patentee seek to amend a patent that is in the midst of patent litigation?
The owner of a patent cannot modify the patent, since the right is granted in the way it was presented, and with the respective claims. In the event of a litigation, the process will be based on the right that was previously granted.
Is some form of patent term extension available?
There are no patent terms extensions available in Ecuador, nor in the Andean Region.
How are technical matters considered in patent litigation proceedings?
Technical matters are considered in patent litigations proceeding by way of competing expert witnesses appointed by the parties, which give oral and written evidence during patent litigation proceedings and can be cross-examined. Although the law determines that these experts must be impartial, their fees are paid by the party that chose them, so they are usually selected for their ability to demonstrate what the party wants. In addition, it is possible to request the judge to appoint an expert if it is essential, but this is so unlikely that it is rarely taken into consideration.
Is some form of discovery/disclosure and/or court-mandated evidence seizure/protection (e.g. saisie-contrefaçon) available, either before the commencement of or during patent litigation proceedings?
Evidence is presented by the parties and is incorporated to the process during hearings, though there might lawfully exist court-mandated evidence to help resolve the dispute. All documentary evidence is under the judge´s custody. It is important to take into account that to obtain all the evidence at the time of filing the claim, there are previous acts that must be carried out, such as: request for administrative protection before the competent authority, in order to obtain; i) a formal information request from the possible offender; or, ii) inspections of institutions, or even the home of the offender, if necessary, in order to validate the existence of an infringement.
Are there procedures available which would assist a patentee to determine infringement of a process patent?
Because Ecuador is a member of the Andean Community, it is part of the Andean Common Industrial Regime, which includes the Decision 486 -Common Provisions on Industrial Property- that in its article 240 states that, in any cases alleging infringement of a patent whose subject matter is a process for obtaining a product, the defendant in question shall be responsible for providing that the process used by him to obtain the product is different from the process protected by the patent allegedly infringed. To that end, it shall be presumed, in absence of proof to the contrary, that any identical product produced without the consent of the owner of the patent has been obtained by the patented process if: (a) the product obtained using the patented process is new; or (b) there exists a reasonable possibility of the identical product having been manufactured using the process, and the owner of the patent for the latter is unable to establish, after reasonable effort, what process was actually used. Therefore, if any of those two assumptions are met, the reversal of the burden of proof regarding the process patent infringement will occur.
Are there established mechanisms to protect confidential information required to be disclosed/exchanged in the course of patent litigation (e.g. confidentiality clubs)?
There is no mechanism to protect confidential information required to be disclosed or exchanged during patent litigation because all information is made public when presented to the judge.
Is there a system of post-grant opposition proceedings? If so, how does this system interact with the patent litigation system?
When the competent authority on intellectual rights issues a resolution, it is possible to present appeals through administrative channels. Among the resources mentioned, an appeal and an extraordinary appeal for review can be filed. In addition, subjective appeals before the Administrative Court can be filed without exhausting the administrative procedure. While the causes are being processed, the administrative resolution is waiting to be modified or ratified.
To what extent are decisions from other fora/jurisdictions relevant or influential, and if so, are there any particularly influential fora/jurisdictions?
What is resolved by the judges or administrative authorities of other fora/jurisdictions is not binding in Ecuador.
However, because Ecuador is a member of the Andean Community, other members of the Community resolve their intellectual property disputes using the same laws. For this reason, their resolutions and sentences may influence national judges or administrative authorities, but it is not mandatory that they maintain the same criteria.
How does a court determine whether it has jurisdiction to hear a patent action?
Jurisdiction and competence are established by national law. As mentioned in question 1, Administrative Court Judges are competent when there is a challenge to an administrative resolution that took effect, but Civil Judges are competent when actions are filed against a third party that has infringed granted intellectual property rights. The court has jurisdiction to deal with foreign patent infringements only if they are registered in Ecuador.
What are the options for alternative dispute resolution (ADR) in patent cases? Are they commonly used? Are there any mandatory ADR provisions in patent cases?
Regarding alternative methods of conflict resolution in Intellectual Property disputes, there is the possibility that a dispute concludes with a friendly agreement between the parties, which will be approved by the Competent Authority.
What are the key procedural steps that must be satisfied before a patent action can be commenced? Are there any limitation periods for commencing an action?
To file a patent action, the administrative procedure must have been completed and the resolution granting the patent must be final. Likewise, it will be necessary to collect the necessary evidence on the infringement of the patent in order to initiate an administrative or judicial action.
The exercise of the sanctioning power in the administrative procedures for infringement of the right prescribe within a period of two years from the date the owner or the Administration became aware of the infringement or, in any case, in five years from the date it was committed the last infringement.
Which parties have standing to bring a patent infringement action? Under which circumstances will a patent licensee have standing to bring an action?
Regarding the parties entitled to file an action for patent infringement, the owner of the patent has this right, since the patent owner has the right to prevent third parties from using the patent without his/her/their consent. The licensee of a patent may also be entitled to file a claim.
Who has standing to bring an invalidity action against a patent? Is any particular connection to the patentee or patent required?
Those who demonstrate their legitimate interest can file an invalidity action.
Are interim injunctions available in patent litigation proceedings?
The interim injunctions are available in patent litigation proceedings. The means to obtain the order of precautionary measures is through an administrative protection action filed to the competent administrative authority, or through a precautionary action initiated with the civil judges. In both cases, the possible or imminent infringement of the patent must be demonstrated. With this evidence, the administrative or judicial authority will grant the precautionary measures. The process will continue until the effective existence of the infraction is proved, so that definitive precautionary measures are finally ordered or revoked.
Occasionally, judges or administrative authorities can request a guarantee from the holder of the right, in order to execute the provisional measures until the effective existence of the infringement of the right has been verified.
What final remedies, both monetary and non-monetary, are available for patent infringement? Of these, which are most commonly sought and which are typically ordered?
The resources that the patent owner has for stopping the infringement of the patent are as follows:
Initiate an action for administrative protection, where the following may be required: the investigation of the possible party infringing the patent, in order to gather more evidence of the infraction; the execution of provisional measures; to decide that the infringement of the right exist; to ratify the precautionary measures, and to require an administrative sanction for the pay infringing the patent, in accordance with the INGENIOS CODE. This administrative procedure will end with the Resolution of the Collegiate Body of the SENADI (administrative authority), if the party infringing the patent files an appeal against the resolution issued in the first instance by the National Directorate of Industrial Property.
Initiate a civil precautionary action, where the right holder may request provisional measures to stop the infringement of the right, that might be ratified.
Once measures i) or ii) have been taken by the right holder, a principal lawsuit for damages must be filed, where the civil judges will analyze the infringement of rights and calculate the damages. That sentence can be appealed before the Provincial Court, and the sentence issued by the Provincial Court can be challenged by an extraordinary cassation resourse.
Once the appeals have been resolved, the sentence can be enforced.
On what basis are damages for patent infringement calculated? Is it possible to obtain additional or exemplary damages?
Patent infringement damages are calculated according to Decision 486 of the Andean Community, the Preliminary Interpretations of the Andean Court of Justice, and local laws and jurisprudence. In order to calculate the damages (general damages and loss of profits), the judge could analyze the technical report of an accountant expert submitted by the patent owner into the lawsuit, or according to the judge’s perception, in accordance with the evidence provided by the right holder in the process. It is not possible to obtain additional or exemplary damages in Ecuador.
How readily are final injunctions granted in patent litigation proceedings?
Usually, if there is enough evidence to convince the judge or the administrative authority of the existence of the patent infringement, preventive precautionary measures are granted immediately, which are considered final, unless the judges that acknowledge the main action (where it is determined whether or not there was an infringement of intellectual property rights), conclude that there were no intellectual property infringement.
In addition, it is possible that in the administrative procedure, the competent authority sanctions the offender without exempting the possibility of the payment of damages being ordered at the judicial stage.
These cases are common in our firm, as we recently achieved compensation for damages with the new General Code of Processes, managing to stop the infringement of the patent of one of the most prestigious pharmaceutical companies while the case was in the administrative stage, and we also obtained the execution of new measures and the compensation of damages in the judicial stage.
Generally, in the final decision of the main action, the judges determine the damages that must be paid by the defendant.
Are there provisions for obtaining declaratory relief, and if so, what are the legal and procedural requirements for obtaining such relief?
There are no provisions for obtaining declaratory relief, only mandatory by the judge.
What are the costs typically incurred by each party to patent litigation proceedings at first instance? What are the typical costs of an appeal at each appellate level?
Leaving aside the attorney’s fees, most of the costs correspond to the opinion of experts in the field, mainly those technical experts who can demonstrate that the patent was infringed and the accounting experts, who calculate the damage caused to the patent holder. Their fees range from US $800 to US $15,000, but it is entirely upon the party to select the experts and approve their fees. Besides attorneys’ and experts’ fees, there may be expenses for official fees when case inspections are required, when the competent authority verifies the possible infringement of the right in a certain place, and also expenses for transportation, copies of documents, etc., which may cost between US $ 500 to US $ 5,000.
Can the successful party to a patent litigation action recover its costs?
Absolutely. The cost of a patent litigation in Ecuador is minimal, so if the patent infringement is proven and the judge orders that the damages caused be paid, the costs of litigation will be more than recovered. But if the patent holder is defeated, he will also lose the expenses incurred during the litigation. Judges may even order that the defeated party pay the expenses incurred by the other party during the litigation; however, the latter situation is unlikely and rarely happens. In any case, the costs of a patent litigation in Ecuador are usually negligible compared to the damages caused by the infringement, which usually must be paid when the patent is infringed. Settlement offers may include the payment of compensation by the party who infringed the patent, as well as the payment of legal costs. There is no procedural mechanism either enabling or requiring security for costs.
What are the biggest patent litigation growth areas in your jurisdiction in terms of industry sector?
The pharmaceutical sector is the biggest litigation growth area in Ecuador. All, if not most, of the patent litigation cases in Ecuador in recent years have been related to the pharmaceutical industry.
What do you predict will be the most contentious patent litigation issues in your jurisdiction over the next twelve months?
Issues related to pharmaceutical patents, especially administrative actions.
Which aspects of patent litigation, either substantive or procedural, are most in need of reform in your jurisdiction?
It is essential that there are expert judges in intellectual property, especially in patents, to obtain fast, reasoned and effective results.
It is also important to reform certain laws that do not clearly state which judge or authority is competent to hear certain actions, and which procedure that must be used.
What are the biggest challenges and opportunities confronting the international patent system?
In reference to the challenges faced by the international patent system, in many cases, the paperwork that revolves around the filing of a patent might result in the loss of the invested costs, or in the inability to continue paying the costs.
It is important to remember that the companies do not always present registration applications in all countries, just only submit it in their country of origin, due to limited resources.
Regarding the opportunities in the international patent system, with the advances in different areas, the legislation can be harmonized so that each inventor may present the application for the registration of their inventions, not only in their country of origin, but in several countries.
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