European Union: European Intellectual Property Cat-and-Mouse: ECJ Clarifies Jurisdiction in Patent Disputes

Can you sue a group of related companies for patent infringement across Europe in one consolidated proceedings in a single jurisdiction?

1. No. A patentee must sue each infringer in their country of domicile pursuant to the patent(s) and law in force there.

It does not matter that the alleged infringers are companies in the same group acting in an identical manner according to a common policy: C-539/03 Roche Nederland and Others.

In which jurisdiction can you claim or counter-claim for invalidity of an intellectual property right?

2. To invalidate a French patent, you must seek revocation in France (and so on).

It is now clearer than ever that cross-border injunctions in patent disputes do not comply with the Brussels Regime. In the past, such injunctions were commonly granted by the Courts in the Netherlands (and sometimes in Germany).

In the past, Dutch Courts have allowed infringement proceedings to be brought against a group of companies in different Contract States if the central policy had been determined by the Dutch defendant (the "spider in the web"). It is now clear that this practice does not comply with the Brussels Regime.

On Thursday 13 July 2006, the First Chamber of the European Court of Justice handed down two judgments which clarify the game of intellectual property cat-and-mouse that is played across the European Contracting States.

The patent in suit was EP 131 627. The patentees, Drs Primus and Goldenberg had argued that Article 6(1) of the Brussels Convention applies in the present case to allow all of the infringement proceedings to be heard together.

(Article 6(1) basically states that where there is more than one defendant, then suit can be brought in the Contracting State of one of the defendants. Article 6(1) is an exception to Article 2 which states that a defendant domiciled in a Contracting State must be sued there in that State.)

Amongst other things, the Court stated:

1. For Article 6(1) to apply there must be a sufficiently close connection so that it is expedient to determine the actions together in order to avoid the risk of irreconcilable judgments resulting from separate proceedings: Case 189/87 Kalfelis [1988] ECR 5565, paragraph 12 (repeating the words of Article 22).
2. For decisions to be contradictory it is not sufficient that there is a divergence in outcomes. The divergence must also arise in the context of the same situation of law and fact.
3. The facts will not be the same in patent infringement proceedings where different companies are being sued, even if the impugned activity is the same.
4. The legal situation will not be the same as the law to be applied varies in each state.
5. To agree with the patentees would multiply the potential heads of jurisdiction, undermine the predictability of the rules of jurisdiction, and consequently undermine the principle of legal certainty, which is the basis of the Convention.
6. The negative effects of such a decision damage would be even more serious if it provided the defendant a wide choice, thereby encouraging forum shopping which the Convention seeks to avoid and which the Court, in its judgment in Kalfelis, specifically sought to prevent.
7. Even if a court seised by the defendant were able to accept jurisdiction, the consolidation of the patent infringement actions before that court could not prevent fragmentation of the patent proceedings as soon as validity is brought into question (which is commonly the case).

This judgment applies to any proceedings relating to the validity, existence or lapse of a patent or an alleged right of priority by reason of an earlier deposit (see Case 288/82 Duijnstee [1983] ECR 3663, paragraph 19).

Given the wording of Article 16(4) of the Brussels Convention, it is quite likely that C-4/03 GAT will also apply to disputes relating to trade marks and designs.

Amongst other things, the Court stated:

1. Article 16 seeks to ensure that jurisdiction rests with courts closely linked to the proceedings in fact and law.
2. The Courts of the jurisdiction in which a patent was applied for are best placed to adjudicate a dispute concerning validity of the patent or the existence of a deposit or registration.
3. The concern for sound administration of justice is all the more important in the field of patents since, given the specialised nature of this area.
4. The issuance of patents necessitates the involvement of the national administrative authorities.
5. To allow a court seised of an action for infringement or for a declaration that there has been no infringement to establish, indirectly, the invalidity of the patent at issue would undermine the binding nature of the rule of jurisdiction laid down in Article 16(4) of the Convention.
6. To hold otherwise would enliven the possibility of circumventing Article 16(4) of the Convention and would have the effect of multiplying the heads of jurisdiction, undermine the predictability of the rules of jurisdiction, and consequently to undermine the principle of legal certainty, which is the basis of the Convention
7. To hold otherwise would multiply the risk of conflicting decisions which the Convention seeks specifically to avoid (see, to that effect, Case C-406/92 Tatry [1994] ECR I-5439, paragraph 52).
8. A judgment which falls foul of the provisions of Article 16 will not benefit from the system of recognition and enforcement under the Brussels Convention: See Article 19, first paragraph of Article 28 and second paragraph of Article 34.

The Brussels Regime consists of the Brussels Convention, the Lugano Convention and the Brussels Regulation (Council Regulation (EC) No 44/2001 of 22 December 2000).

Article 6 of the Brussels Convention, which appears in Section 2 of Title II, entitled ‘Special jurisdiction’, states:

Article 16(4) of the Brussels Convention states:

Article 18 of the Brussels Convention states:

Articles 64(1) and (3) of the Munich Convention provides:

The question to be determined by the ECJ in C-4/03 GAT was:

The questions to be determined in C-539/03 Roche Nederland and Others were:

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© Duncan Bucknell 17 July 2006

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