Special Report: Union Lawsuit Claims EPO Has Prevented It From Functioning; Office Claims Immunity 11/07/2016 by Dugie Standeford for Intellectual Property Watch 2 Comments Share this:Click to share on Twitter (Opens in new window)Click to share on LinkedIn (Opens in new window)Click to share on Facebook (Opens in new window)Click to email this to a friend (Opens in new window)Click to print (Opens in new window)Deteriorating relations between European Patent Office (EPO) management and staff union SUEPO have sparked another lawsuit in the district court in The Hague, Netherlands. The matter, which will be heard in a 15 July summary proceeding, alleges a pattern of threats, dismissals, suspensions from service and gagging of union members, said Prakken d’Oliveira attorney Liesbeth Zegveld, who represents SUEPO and its Dutch branch. Around one-third of union officials have been suspended, investigated or gagged, effectively preventing the union from functioning, she said in an interview. The lawsuits are just part of the ongoing turmoil affecting the EPO. Reform of the Boards of Appeal (BoA) has also proved controversial, and there are concerns about the reluctance of the Administrative Council to get a grip on the staff-management battle. The EPO said that, as an international organisation, it has immunity from such suits, as recently held by a German court. It defended its changes to the BoA, and announced an autumn conference for stakeholders to discuss an independent study on office social issues. European Patent Office, The Hague SUEPO Action Seeks to “Prevent New Casualties” The union challenge follows one last year in which a Hague appeals court ruled that the EPO had violated fundamental union rights and is not immune from suit, Zegveld said. The decision is on appeal to the country’s Supreme Court, where a judgment is expected before year’s end, she said. When SUEPO tried to implement that earlier decision, EPO management not only ignored it but launched so many investigations that the union decided to bundle all the individual cases together under the claim that the office is hampering union operations, Zegveld said. It isn’t an easy claim because it hinges on individual cases which union members are barred from discussing, she said. The EPO refused to accept the writ of summons issued for the hearing and Zegveld said she doesn’t expect any office representative to appear. The district court will nevertheless be required to consider whether the EPO is immune from suit because the final decision on the Appeals Court ruling is pending, she noted. The EPO member states, who make up the Administrative Council (AC), have asked the office to postpone the various employee investigations and disciplinary proceedings pending an independent evaluation of their compliance with law and fairness, but President Benoît Battistelli has refused, said Zegveld. The union wants AC members to tackle the mess and is hoping that a positive Supreme Court ruling will nudge them in the right direction, she said. The latest lawsuit aims to “prevent new casualties from happening” to union members and their families, she added. The challenge was filed in Holland because it is one of the two largest EPO offices, Zegveld said. Union staff in Germany, the other main office, are also under attack and there have been legal challenges there as well, she said. The Netherlands is well aware of the situation but it, like the other governments in the AC, has only one vote, she told Intellectual Property Watch. Asked whether EPO representatives will appear at the hearing, an office spokesman stressed that “the accepted principle of immunity for international organisations under international law, as applied in the Netherlands, is intended to ensure their proper functioning and guarantees that no one member state has authority over any subject of any other member state. This is why the Labour Court of Munich by a decision on 28 June just confirmed the first instance decision confirming this principle and totally rejected the claims of SUEPO.” Boards of Appeal Reform Prompts Wariness At a 29-30 June meeting in Munich, the AC agreed to reform its Boards of Appeal “to strengthen the perception of the BoA’s independence, in particular by increasing their managerial autonomy, and to improve their efficiency,” the office said. The BoA is the body that decides appeals against decisions of the EPO concerning European patents and patent applications. Under the reform, the current BoA will be changed to a Boards of Appeal Unit within the EPO managed by a president of the BoA who will be solely responsible to the AC and not to the EPO president, the office said. There will be a newly created subsidiary committee of the AC, which will link between the BoA and the AC, it said. There will be a “specific career system” for members and chairmen of the BoA, and a new location for the BoA Unit with a separate building. The package also includes provisions to guard against conflicts of interest. The EPO original proposal for reform is here. The final version is a compromise. “While several delegations still expressed their reservations about some parts of the final proposal … the majority approved the package in the spirit of good cooperation and with the express request to revisit this decision in two or three years,” the Institute of Professional Representatives before the European Patent Office said in a 4 July blog. But the European Patent Lawyers Association said in a 1 July blog that “it appears that the concerns expressed by the members of the BoA … had little influence on the final decision of the Council.” The most serious concern seems to be the security of tenure of board members, a problem “aggravated by the conflict of interest rules restricting activities for board members who are not reappointed, it said. Another “challenge for independence may be seen in the continuing integration of the BOA into the general administration of the EPO, in particular Human Resources and IT,” EPLA wrote. “It remains to be seen whether the Office continues to claim competence to undertake investigations against members of the BOA and the integrated IT structure casts doubts whether the confidentiality of the decision making process in the BOA is safeguarded.” Many of the delegates’ counter-propositions “aimed at reducing the power of the EPO president over the Boards (nomination, budget, career, disciplinary procedures) and at avoiding that he can take back that delegation (they know him),” a staff summary of the AC meeting said. Several reforms that would have been bad for staff were postponed, including one to revise investigation guidelines to give more power to the president and investigative unit and to revamp disciplinary proceedings to allow the president to dismiss employees for professional incompetence more easily, it said. BoA structural reform “achieved the best possible solution without changing the European Patent Convention, as requested by our Member States,” the EPO spokesman emailed. “This is why the reform was quasi unanimously adopted by them.” To go further, “as sometimes requested by some circles,” would mean revising the EPC, a 10-year long process, he said. The EPO denied that BoA judicial independence has ever been an issue, saying that “there has not been a single case in 40 years of practice.” Nevertheless, “because their perceived independence was presented as a potential issue in one single decision of the Enlarged Board of Appeal in 2014, a whole set of measures that guarantees the highest level of autonomy and further strengthens the perception of organisational independence of the Boards, was defined and adopted in less than two years,” EPO said. Battistelli has agreed to delegate managerial and administrative powers to a newly created BoA president, an “exceptional constitutional act,” the spokesman told Intellectual Property Watch. European Patent System “At Risk” As for staff efforts to spur the AC to take control of the downward-spiralling situation: In a 22 June letter, the EPO-FLIER team, which identifies itself as “a group of concerned staff of the EPO who wish to remain anonymous due to the prevailing harsh social climate and absence of rule of law” at the office, begged Council members to assert their “fiduciary duty” over the organisation. The AC took responsibility when it issued a resolution with “clear and achievable objectives for the President,” the open letter said. “Very briefly there was a marked improvement of the atmosphere in the Office.” But instead of complying with the unambiguous instructions, Battistelli has challenged his supervisory body, it said. “Mr. Battistelli is causing immeasurable damage to the Office; he is now untenable.” Among other problems, the letter said, applicants have started noticing a decline in the quality of EPO patents, and, because of the ongoing disputes, the office no longer attracts the same calibre of staff. The letter also noted Battistelli’s continuing disregard for staff rights. “And all the time, the members of the Office’s only supervisory body watch it happen.” “I believe the situation is now so bad and dangerous at the EPO that it is time that public, patent attorneys, economists and company bosses assemble and act together,” one staff member wrote in anonymous comments published on 3 July. “Make a petition, use your professional or private network if you know politicians, journalists, economist, write to ministers or representatives. We need to inform them that the whole European Patent System is at risk.” Official recognition of the trade unions in the EPO’s legal framework “remains a high priority for the Office,” said its spokesman. One union has already signed a memorandum of understanding and begun talks on several issues with the administration, he said. “We hope that the other one will change its position and sign it in the coming months.” The EPO will hold a conference in the fall “to discuss the results of a comprehensive social study recently conducted by an independent, external consultancy at the joint request of the EPO and the member states,” the spokesman said. All stakeholders, including the unions, will be invited to take part, he added. 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