September 28th, 2021

Brazil: tackling patent infringement in the courts

Thiago Villa

Brazil: tackling patent infringment in the courts

Brazil is the second largest country in the Americas, both in terms of GDP and population. The Brazilian Industrial Property law (Law 9279/1996) governs all areas of IP (patents, trademarks, designs, unfair competition, etc.) and also sets out important procedures and criteria to follow in cases of patent infringement.

In terms of tackling patent infringement, the Brazilian courts provide effective solutions for both national and international claimants alike. The country has an independent judiciary and injunctions are widely available when required (in fact, the standards to obtain such relief are quite low compared to other countries like the US).

So, want to know more about the Brazilian courts and how they deal with patent infringement cases. Keep reading below.

IP and the Brazilian Courts

Each Brazilian state has its own judicial system and therefore patent infringement lawsuits can be filed before any state court. As a general rule, patent infringement lawsuits must be filed in the state where the accused infringer has its principal place of business. However, they may also be filed in any place where acts of patent infringement occurred.

Specialist judges are not available. However, a number of specialized IP courts have been created in recent years. Rio de Janeiro has four federal district courts with special jurisdiction to hear cases filed against the Brazilian Patent and Trademark Office (BPTO). In turn, the Federal Court of Appeals for the Second Circuit, which has jurisdiction to decide appeals from Rio de Janeiro, has two chambers specialized in IP cases.

At state level, all major Brazilian cities have courts specialized in commercial and corporate law, which encompasses IP. For instance, Rio de Janeiro has seven state courts with jurisdiction to hear commercial law cases, including IP cases, and São Paulo also recently created two such courts.

Pre-Trial Disclosure

Under Brazilian procedural law, there is no general obligation for a party to list or disclose documents, but the parties will usually submit documents which they consider relevant to support their own case. Documents are filed with the court, but not served on the other side.

Court Procedure

A patent infringement lawsuit starts with the filing of the complaint, where the plaintiff must assert its claims of patent infringement in relation to the product or process in question. Normally, the burden of proof falls on the plaintiff (except in the case of infringement of a process patent), who must present documentary evidence of the infringement and, advisably, technical and legal opinions.

After the defendant is duly served with a summons, the court usually schedules a mandatory mediation hearing to try to achieve a settlement between the parties. If the conciliation attempt fails, the defendant is given a 15-business-day term to file its reply to the complaint, where all possible defenses will be presented together with supporting evidence.

In a patent infringement case, both parties may request the court to allow the submission of further evidence during the proceeding.

After the defendant files its defense and the plaintiff presents its counter arguments, the judge usually nominates a technical expert to conduct an examination and provide the court with an opinion on the technical aspects of the case. Parties may appoint their own experts to interface with the court-appointed expert and provide any clarificationas needed. Parties may also submit technical questions to be answered by the court expert.

After the court-appointed expert delivers the opinion to the court, and parties submit their own arguments in relation to such opinion, the judge will set a date for closing arguments (in written form).

Trial Hearings

Trial hearings are very rare in Brazil. When these occur, court records are already completed, and the parties and the judge have already read the briefs. During trial, the parties’ attorneys, their experts or witnesses will present evidence mostly orally.

Each party may call up to 10 persons to testify, among witnesses and experts, but the judge may limit this number to a maximum of three per each side. The judge will question the witnesses separately and successively, starting with the plaintiff’s witnesses.

The party’s representatives may also be called to put forward their evidence. The judge puts forward all questions and the parties may address the court with additional questions, besides the ones being made.

Plaintiffs cannot change pleadings or causes of action (arguments) once the defendant is served with a summons, unless the defendant consents. The plaintiff cannot, under any circumstances, change its pleadings or causes of action after the judge renders a decision defining the issues in the case and the scope of the evidence production phase.

Trial hearings generally take one day, but can sometimes take longer depending on the complexity of the case and on the number of experts and witnesses called by each party. After trial, the judge is expected to issue a decision within 30 days, but this rarely occurs. Normally, a final decision on the merits takes about six months to be rendered, especially in complex cases.

Judgments

Judgments may be accessed by the public and third parties can request copies of same. Some judgments are rendered under seal in special circumstances, but this is not common in IP cases.

Court decisions in Brazil are generally non-binding. Nevertheless, precedents from the superior courts are often significantly persuasive to lower courts. Foreign precedents are rarely used and usually disregarded by local courts.

Injunctions

Both preliminary and permanent injunctions are available in Brazil. Preliminary injunctions may be granted as long as substantive evidence is submitted, and the court is convinced of (i) the likelihood of success on the merits, and (ii) the need for an urgent decision from courts to avoid irreparable harm. In granting a preliminary injunction, courts will balance the hardships and the effect of not doing so in cases where the injunction effects are irreversible.

In order to avoid irreparable damages or damages that would be difficult to recover, the judge can even grant an injunctive order to suspend the violation or act of infringement before summoning the defendant (ex parte), ordering the plaintiff to post a bond or a fiduciary guarantee in cases where he deems it necessary.

Permanent injunctions are also available and are normally granted whenever a judgment on patent infringement is handed down, although a stay on the injunction may be determined by the Court of Appeals before the appeal has been decided upon by the court.

Damages

According to the Patent Statute, loss of profits shall be determined by the most favorable to the patentee of the following criteria: (i) the benefits that would have been gained by the injured party if the violation had not occurred; (ii) the benefits gained by the infringer; or (iii) the remuneration that the infringer would have paid to the patentee for a license that would have legally permitted him to exploit the patented technology.

It is possible to obtain compensation for acts of patent infringement which occurred between the date of publication of the application and that of the grant of the patent, or even before publication, if there is proof that the infringer has knowledge of the contents of application prior to publication.

There is no statutory provision setting forth punitive damages in Brazil and courts are usually reluctant to adopt this doctrine.

Enforcement of Judgments

In the civil courts, the patentee can obtain a preliminary restraining order, provided for in the current Patent Law, for the immediate cessation of the patent infringement. Ex parte seizure of the infringing products can also be obtained when the judge is convinced that the plaintiff’s IP rights are seriously threatened by the defendant’s infringing activities. The plaintiff can request the courts to issue orders to destroy, to buy back stock or to deliver up the infringing goods. Damages (loss of profits) can be claimed by the plaintiff and enforced against the infringer.

Statute of Limitations

There is a five-year statute of limitations for patent infringement, which starts to run after the last act of patent infringement.

Appeal

Parties can appeal the first instance judgment, and all aspects of the judgment may be reviewed by the Court of Appeals.

Conclusion

Above we have provided you with a brief introduction about the Brazilian Courts and how they operate in patent infringement cases.

If you are looking for more specific information on the topic of patent infringement or other areas related to IP and technology matters in Brazil, we invite you to access the FAQ Section on our website and sign up to our newsletter.

Brazil: tackling patent infringment in the courts

Brazil is the second largest country in the Americas, both in terms of GDP and population. The Brazilian Industrial Property law (Law 9279/1996) governs all areas of IP (patents, trademarks, designs, unfair competition, etc.) and also sets out important procedures and criteria to follow in cases of patent infringement.

In terms of tackling patent infringement, the Brazilian courts provide effective solutions for both national and international claimants alike. The country has an independent judiciary and injunctions are widely available when required (in fact, the standards to obtain such relief are quite low compared to other countries like the US).

So, want to know more about the Brazilian courts and how they deal with patent infringement cases. Keep reading below.

IP and the Brazilian Courts

Each Brazilian state has its own judicial system and therefore patent infringement lawsuits can be filed before any state court. As a general rule, patent infringement lawsuits must be filed in the state where the accused infringer has its principal place of business. However, they may also be filed in any place where acts of patent infringement occurred.

Specialist judges are not available. However, a number of specialized IP courts have been created in recent years. Rio de Janeiro has four federal district courts with special jurisdiction to hear cases filed against the Brazilian Patent and Trademark Office (BPTO). In turn, the Federal Court of Appeals for the Second Circuit, which has jurisdiction to decide appeals from Rio de Janeiro, has two chambers specialized in IP cases.

At state level, all major Brazilian cities have courts specialized in commercial and corporate law, which encompasses IP. For instance, Rio de Janeiro has seven state courts with jurisdiction to hear commercial law cases, including IP cases, and São Paulo also recently created two such courts.

Pre-Trial Disclosure

Under Brazilian procedural law, there is no general obligation for a party to list or disclose documents, but the parties will usually submit documents which they consider relevant to support their own case. Documents are filed with the court, but not served on the other side.

Court Procedure

A patent infringement lawsuit starts with the filing of the complaint, where the plaintiff must assert its claims of patent infringement in relation to the product or process in question. Normally, the burden of proof falls on the plaintiff (except in the case of infringement of a process patent), who must present documentary evidence of the infringement and, advisably, technical and legal opinions.

After the defendant is duly served with a summons, the court usually schedules a mandatory mediation hearing to try to achieve a settlement between the parties. If the conciliation attempt fails, the defendant is given a 15-business-day term to file its reply to the complaint, where all possible defenses will be presented together with supporting evidence.

In a patent infringement case, both parties may request the court to allow the submission of further evidence during the proceeding.

After the defendant files its defense and the plaintiff presents its counter arguments, the judge usually nominates a technical expert to conduct an examination and provide the court with an opinion on the technical aspects of the case. Parties may appoint their own experts to interface with the court-appointed expert and provide any clarificationas needed. Parties may also submit technical questions to be answered by the court expert.

After the court-appointed expert delivers the opinion to the court, and parties submit their own arguments in relation to such opinion, the judge will set a date for closing arguments (in written form).

Trial Hearings

Trial hearings are very rare in Brazil. When these occur, court records are already completed, and the parties and the judge have already read the briefs. During trial, the parties’ attorneys, their experts or witnesses will present evidence mostly orally.

Each party may call up to 10 persons to testify, among witnesses and experts, but the judge may limit this number to a maximum of three per each side. The judge will question the witnesses separately and successively, starting with the plaintiff’s witnesses.

The party’s representatives may also be called to put forward their evidence. The judge puts forward all questions and the parties may address the court with additional questions, besides the ones being made.

Plaintiffs cannot change pleadings or causes of action (arguments) once the defendant is served with a summons, unless the defendant consents. The plaintiff cannot, under any circumstances, change its pleadings or causes of action after the judge renders a decision defining the issues in the case and the scope of the evidence production phase.

Trial hearings generally take one day, but can sometimes take longer depending on the complexity of the case and on the number of experts and witnesses called by each party. After trial, the judge is expected to issue a decision within 30 days, but this rarely occurs. Normally, a final decision on the merits takes about six months to be rendered, especially in complex cases.

Judgments

Judgments may be accessed by the public and third parties can request copies of same. Some judgments are rendered under seal in special circumstances, but this is not common in IP cases.

Court decisions in Brazil are generally non-binding. Nevertheless, precedents from the superior courts are often significantly persuasive to lower courts. Foreign precedents are rarely used and usually disregarded by local courts.

Injunctions

Both preliminary and permanent injunctions are available in Brazil. Preliminary injunctions may be granted as long as substantive evidence is submitted, and the court is convinced of (i) the likelihood of success on the merits, and (ii) the need for an urgent decision from courts to avoid irreparable harm. In granting a preliminary injunction, courts will balance the hardships and the effect of not doing so in cases where the injunction effects are irreversible.

In order to avoid irreparable damages or damages that would be difficult to recover, the judge can even grant an injunctive order to suspend the violation or act of infringement before summoning the defendant (ex parte), ordering the plaintiff to post a bond or a fiduciary guarantee in cases where he deems it necessary.

Permanent injunctions are also available and are normally granted whenever a judgment on patent infringement is handed down, although a stay on the injunction may be determined by the Court of Appeals before the appeal has been decided upon by the court.

Damages

According to the Patent Statute, loss of profits shall be determined by the most favorable to the patentee of the following criteria: (i) the benefits that would have been gained by the injured party if the violation had not occurred; (ii) the benefits gained by the infringer; or (iii) the remuneration that the infringer would have paid to the patentee for a license that would have legally permitted him to exploit the patented technology.

It is possible to obtain compensation for acts of patent infringement which occurred between the date of publication of the application and that of the grant of the patent, or even before publication, if there is proof that the infringer has knowledge of the contents of application prior to publication.

There is no statutory provision setting forth punitive damages in Brazil and courts are usually reluctant to adopt this doctrine.

Enforcement of Judgments

In the civil courts, the patentee can obtain a preliminary restraining order, provided for in the current Patent Law, for the immediate cessation of the patent infringement. Ex parte seizure of the infringing products can also be obtained when the judge is convinced that the plaintiff’s IP rights are seriously threatened by the defendant’s infringing activities. The plaintiff can request the courts to issue orders to destroy, to buy back stock or to deliver up the infringing goods. Damages (loss of profits) can be claimed by the plaintiff and enforced against the infringer.

Statute of Limitations

There is a five-year statute of limitations for patent infringement, which starts to run after the last act of patent infringement.

Appeal

Parties can appeal the first instance judgment, and all aspects of the judgment may be reviewed by the Court of Appeals.

Conclusion

Above we have provided you with a brief introduction about the Brazilian Courts and how they operate in patent infringement cases.

If you are looking for more specific information on the topic of patent infringement or other areas related to IP and technology matters in Brazil, we invite you to access the FAQ Section on our website and sign up to our newsletter.

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