Today was decision day for the EU patent. It was bad news for those who believe in European innovation. Still, it could have been worse.

The European Court of Justice (ECJ) ruled that the planned new EU patent court that was supposed to be a single Europe-wide forum for litigation in cases of patent infringement was unconstitutional.

The new IP body could be providing rulings that changed national laws, and also clash with the EU's current body of legislation, the ECJ has said. The ECJ also complained it would have had no overseeing rights over the patent court.

The commission now heads back to the drawing board.

Without a common patent court, the common EU patent idea is weakened, but the actual establishment of a EU patent is a separate legal issue - and the member states (minus Italy and Spain) have vowed to press head with it, despite the ECJ decision, it was announced on Tuesday.

What a European patent without a common litigation mechanism will mean remains to be seen, but the commission said today it is working on a compromise proposal that it hoped would retain some advantages of the original proposal. EU-based lawyers predicted it would be an uphill struggle.

Spain has its own beef with the patents plan: it opposes French and German being official languages of the new proposed patent, on top of English, and said it would be prepared to go to the ECJ separately. That is another threat to any compromise proposal.

At the moment, patent infringements are battled out individually and in national courts, creating large costs for small companies when infringements are taking place in several countries. It also gives rise to inconsistencies and confusions.

Perhaps the patent court as envisaged didn't go quite by the rules, but it reflected a determination of most member states and the commission to get European industry and innovation going again. That the ECJ blocked it was a reflection of its huge, mostly unseen, and, its critics poiint out, unaccountable powers.

Last week, it ruled that different car insurance prices for men and women was illegal - which infuriated risk analysts and brought the Luxembourg-based court to the rare attention of the tabloid reading public.

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Pelle Neroth -- EU correspondent

Edited: 08 March 2011 at 05:54 PM by Pelle Neroth