Netherlands: The Netherlands: The Country Of Cross-Border Injunctions In IP

PART 1: PATENTS, TRADEMARKS AND DESIGN RIGHTS

Intellectual property ("IP") rights are territorially limited rights. To enforce your IP rights in different territories (usually countries) you traditionally have to address courts in each territory separately. Dutch courts have allowed exceptions to this rule by granting cross-border injunctions covering other countries as well. This has been a trend with the Dutch courts since 1989¹ but met with considerable criticism and was rejected by the Court of Justice of the European Union ("CJ") in 2006. Recently, however, the winds seem to have changed once again: the cross-border practice has been endorsed conditionally by the CJ. Although the CJ case law mainly pertains to patent rights, we see cross-border injunctions being granted in other fields of IP as well, notably in trademark and designs cases. This newsletter provides an overview of the possibility to obtain cross-border injunctions in the Netherlands for the aforementioned IP rights. It is the first in a series of three; in part two we will address cross-border measures for other IP rights (such as copyright) and in part three we will give an update on 'pre-trial cross-border enforcement' and securing evidence in the Netherlands for the infringement of IP rights outside the Netherlands.

1. Cross-border measures in IP cases - legal background

Apart from several specific provisions for certain IP rights², jurisdiction in IP cases within the European Union ("EU") is governed by Council Regulation (EC) No 44/2001 of 22 December 2000 on jurisdiction and the recognition and enforcement of judgments (the "JRER") and by national procedural rules and practice. National procedural rules are especially important for interpretation of the JRER and for situations not governed by the JRER such as defendants not domiciled in an EU Member State. Once (international and cross-border) jurisdiction has been established, there is general consensus regarding the applicable law for judging whether infringement takes place: this is the law of the country or territory of the allegedly infringed IP right (lex loci protectionis). The crucial step for granting cross-border injunctions is therefore to establish jurisdiction.

The basic rule is that the court of the country where the defendant is domiciled has jurisdiction (Article 2(1) JRER). Based on this rule several European courts - including Dutch courts - accept cross-border jurisdiction to handle infringements of foreign patents and other IP rights by a defendant based in the region where the court has its seat. There are four exceptions to the basic rule that are relevant for IP cases, which were clarified by the CJ in several – mostly patent – cases. These rules are summarised in the first two columns of Table 1. The most relevant CJ case law pertaining to each article is recapitulated briefly in the third column. The last column of Table 1 highlights the Dutch interpretation where relevant. In short, only Art. 2 (for national defendants), 6 (closely connected cases against multiple defendants to avoid irreconcilable judgements) and 31 (provisional measures) JRER can create jurisdiction to grant cross-border injunctions.

Table 1 Jurisdiction rules for IP rights (as applied by Dutch courts)

*) What this exclusive jurisdiction means in practice depends on national laws. E.g. in Germany invalidity and infringement are judged in separate proceedings. The infringement case will therefore not be affected by invalidity raised in separate proceedings. UK law provides that invalidity and infringement are dealt with simultaneously by the same court. Exclusive jurisdiction for invalidity will therefore also mean exclusive jurisdiction regarding infringement.

2. Patents: Dutch cross-border measures against foreign defendants accepted

In the early 1990s the Dutch Patent Court in The Hague started to grant cross-border injunctions with respect to foreign patents against foreign (non-Dutch) defendants. The classic scenario is an injunction in summary proceedings against a parent company and all its subsidiaries for all countries for which the plaintiff's European patent ("EP") was granted. This measure greatly simplified litigation for the patent owner. However, it met with considerable criticism. More than two decades and several CJ judgments⁴ later, it has now become clear under which conditions such injunctions have the blessing of Europe's highest court, the CJ. Firstly, it is possible to give cross-border provisional measures also when an invalidity defence is raised. Furthermore in Painer (C-145/10) and Solvay v Honeywell (C-616/10) the CJ opened the door for the application of Art. 6(1) in IP cases⁵, also in main proceedings. The CJ explained that in patent cases the risk of irreconcilable judgments can arise in a situation where defendants from several Member States: "in proceedings pending before a court of one of those Member States, are each separately accused of committing an infringement of the same national part of a European patent which is in force in yet another Member State by virtue of their performance of reserved actions with regard to the same product" (emphasis added). The CJ added that: "It is for the referring court to assess whether such a risk [of irreconcilable judgments] exists, taking into account all the relevant information in the file."

It is now largely up to national courts to determine when Art. 6 applies – also in main proceedings taking into account Art. 22(4) JRER - by assessing what "the same situation in law and fact" entails taking into account that "same law" can mean "substantially identical" since Painer. For provisional cross-border in patent cases the only limitations are that the measures limited in time and that there is a real connecting link with the court's territory. As the CJ did not specify what this means this is also for national courts to determine. The Netherlands remains an excellent forum for cross-border measures in patent cases as the District Court of The Hague favours the possibility of cross-border measures in case of parallel national patents, particularly where national parts of an EP are concerned, given its practice and interpretation of the rules in the past and the national legal framework. The specific applicability to your case will obviously depend on the factual details.

What does this mean in practice? In 2011 the District Court of The Hague in Apple v Samsung⁶granted cross-border injunctions against Dutch Samsung entities; the injunction against the Korean co-defendant was limited to the Netherlands as no cross-border was requested. According to the current Dutch legal framework also the latter injunction could have had cross-border effect. Had the Korean entity been based in an EU Member State such jurisdiction could be based on Art. 6 JRER as all entities infringed the same national parts of EPs with the same products. Dutch national jurisdiction rules for a Non Member State are similar but slightly broader and would also merit a cross-border injunction against the non-EU entity.

3. Trademark and Design Rights: Dutch Courts grant cross-border injunctions

The situation with respect to these rights differs from other IP rights because the territory is not always limited to one country. National (or Benelux⁷) and Community trademark and design rights co-exist within the EU. The respective regulations contain certain specific provisions regarding jurisdiction. However, the case law concerning Art. 6 JRER discussed above is also relevant for these rights. With Community and Benelux rights, the same situation of law required for Art. 6(1) JRER to apply is given for the designated territory.

In practice even before the CJ's judgment in Solvay v Honeywell, the District Court of The Hague assumed cross-border jurisdiction on the basis of Art. 6(1) JRER to grant EU-wide injunctions with respect to Community trademarks against foreign companies in two different preliminary injunction proceedings (BP v Shell, 7 May 2012 and Ten Cate v Fieldturf, 11 July 2012). These rulings are illustrative of the progressive attitude of Dutch courts to grant EU-wide injunctions against foreign companies also in trademark cases. The Court held that Art. 6(1) JRER is applicable supplementary to the rules regarding jurisdiction as laid down in the Community Trademark Regulation ("CTMR")⁸ and that jurisdiction based on Art. 6(1) in principle is cross-border. In Ten Cate v Fieldturf, Ten Cate thus successfully invoked its Community trademark against all (related) defendants, also against the foreign entities, both from within and outside the EU. The injunction covered all 27 EU Member States.

In Bang & Olufsen v Loewe (21 January 2013, preliminary injunction proceedings) the District Court of The Hague recently held that Art. 6 applies likewise to cases concerning the Community Design Regulation ("CDR").

Finally, we note that a Dutch court is, in principle, always competent to grant a cross-border injunction with respect to the Benelux territory, insofar as the infringement by a (foreign) company relates (only) to a Benelux trademark or Benelux design.

4. Practical consequences and conclusion

In a trademark, design rights or patent case where a Dutch and a foreign defendant are sued jointly for infringement of parallel IP rights in several EU countries by committing similar infringing acts, it should in principle be possible to obtain a cross-border injunction against all parties in the Netherlands under the conditions explained above. For EU-based foreign defendants it will be necessary to illustrate that the same situation of law and fact exists; for non-EU foreign defendants broader Dutch national rules apply. Due to the on-going harmonisation of IP law within the EU it is likelier that there is the same situation in law. In proceedings concerning provisional measures different, even broader possibilities to obtain cross-border measures exist in the Netherlands.

The small size of the country combined with the Dutch business spirit has traditionally resulted in a strong cross-border orientation of the Dutch. This is reflected in the case law of the Dutch courts. Therefore the Netherlands is an excellent forum for cross-border measures in IP cases. We would be happy to advise whether cross-border measures can be obtained in your specific situation.

Regarding the enforcement of judgments within the EU it is noteworthy that as from 2015 judgments from one EU Member State will be automatically recognised in any other EU Member State when an amendment of the JRER relating thereto becomes effective.

Footnotes

1. Interlas v Lincoln, Dutch Supreme Court 24 November 1989

2. The Community Trademark and Community Design Regulations contain certain specific provisions for jurisdiction.

3. Repeated in Freeport, C-98/06 [2007], (a case regarding tort and breach of contract) paragraph 40 and Painer C-145/10 [2011] (a copyright case), paragraph 79.

4. The most important being GAT v LuK (C-4/03) [2006], Primus v Roche (C-539/03) [2006] and Solvay v Honeywell (C-616/10) [2012].

5. For more details see our Legal Alert on Solvay v Honeywell click here or refer to our website

6. Preliminary injunction proceedings District Court the Hague, 24 August 2011.

7. In the Benelux (Belgium, the Netherlands and Luxembourg) national trademark and design rights do not exist; there are Benelux rights instead.

8. Council Regulation (EC) No 207/2009 of 26 February 2009 on the Community trademark. Article 6 (1) JRER is not excluded in article 94 (2) CTMR

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.