UPC: Court of Appeal orders licensing bar on defendants’ employees

In two separate decisions handed down on the same day, the Court of Appeal of the Unified Patent Court (UPC) imposed a licensing bar on certain employees of the defendants, preferring this approach over an “external‑eyes‑only” (EEO) confidentiality regime sought by the claimants (UPC_CoA_755/2025, Sun Patent Trust v Vivo; and UPC_CoA_631/2025, Ericsson v ASUS).

In first instance proceedings lodged at the Paris Local Division, Sun Patent sought the determination of the terms of a FRAND licence between the parties, and relied on an exhibit including specific licence agreements entered into by the claimant and a third party. Sun Patent applied for the protection of this exhibit as confidential information under Rule 262A, requesting particular restrictions including an EEO regime, i.e. requesting the Court to exclude any employees of the defendant from having access to the confidential information. This was rejected by the Paris Local Division, which allowed access to three named employees of the defendant but ordering that, for a certain period, those persons shall not be involved in any licensing negotiations with the third party.

In appeal proceedings, intervened by Apple in support of the claimant, the Court of Appeal have broadly upheld the impugned order, including the licensing bar. In rejecting the request for an EEO regime, the Court said that “the fact that a person is an employee of a party is, as a general rule, not sufficient to deny access to that person”, suggesting that “access for a party’s employees will often be essential to ensure compliance with the right of that party to an effective remedy and to a fair trial”. The Court held that the “potential harm to a third party may be mitigated by requiring said employee(s) to refrain from involvement in patent licensing negotiations with the third party for a certain period” and hence ordered a licensing bar on the named employees, for a period of two years in the case of Sun Patent. 

Similarly in April 2025, the Milan Local Division rejected Ericsson’s application for an EEO regime, citing UPC CoA no. 621/2024. The Judge Rapporteur asserted that an EEO regime may be ordered in exceptional cases, for example with the agreement of all parties, or in the event of interference of the patent system with the antitrust system, which was not sufficiently proven in this case. A confidentiality club was established by the Court under Rule 262A, rejecting the EEO request. In their request for a panel review, Ericsson insisted that an EEO regime be applied to any confidential licence agreements between Ericsson and third parties subsequently filed in the proceedings. However, the Judge Rapporteur’s decision was upheld, and Ericsson was granted leave to appeal.

The Court of Appeal stated that the Judge Rapporteur and panel did not err in allowing an ASUS employee to access the confidential information. However, on ASUS and intervener Apple’s suggestion, the Court applied a five-year licensing bar to the employee, since they cannot “unlearn” the information related to the confidential licences. The Court said that the bar is necessary to protect the confidential information, but also provides all parties with greater legal certainty, without unduly impairing the rights of ASUS or their employee.

Together, these decisions demonstrate the Court of Appeal’s pragmatic and balanced approach to confidentiality before the UPC. The Court places particular emphasis on safeguarding a party’s right to a fair trial through access to confidential material, while at the same time imposing safeguards to prevent any unfair commercial advantage that might arise from that access, an issue that is especially important in FRAND disputes.