Cross-Border Litigation over European Patents
May 2000
Patents only serve their purpose if they are actually enforced by the patent owner. Normally this is initiated through a warning letter to the infringing party, but will clearly need to be followed up with legal action if the letter does not achieve the desired effect.
In today's global environment courts dealing with patent disputes have increasingly to consider the international aspects surrounding infringement and validity. There is, however, no international jurisdiction for patent disputes whose competence goes beyond the territory of one state.
And while the planned introduction of a Community patent for EU member states may change the situation in the near future, cross-border litigation between European jurisdictions today remains practically as difficult and complex as it is when litigating across any national boundary - notwithstanding the European Union.
This is because, once it has been granted, a European patent divides itself into a bundle of national patents. There is, therefore, no uniform patent that is valid in the EPO Member States regardless of the national borders. Rather, there are a number of national patents - depending upon the quantity of states for which patent protection has been sought - which exist separately and are subject to the respective national laws.
Dealing with cross-border litigation
Given this situation, then, how can patent owners, and the courts, in Europe deal with cross-border litigation? In fact, the Brussels Convention - agreed between member states of the EU, and which contains rules on jurisdiction in international disputes, and the enforcement of decisions rendered by courts of the member states - does offer a number of possible approaches.
It should be stressed at the outset, however, that infringement litigation in Europe is rife with difficulties. This is particularly the case where a European patent is being infringed not by one company alone, but by a number of companies from different member states of the European Patent Convention.
Nevertheless, there are occasions when a European patent is infringed in different European states where a court may feel warranted in expanding the case in question to other acts of infringement beyond its jurisdiction.
The first thing a court must do when asked to make a decision that has international implications is to establish whether it has competence to make a ruling that will affect matters in another jurisdiction - and the Brussels Convention on jurisdiction and the enforcement of judgments in civil and commercial matters contains provisions that offer some guidance.
Below are some cases that show how these matters have been treated in the past by European courts, and suggest that in applying to a European court for a decision the owner of a patent can sometimes successfully ask for a ruling on infringement of all parts of a European patent.
The objection of nullity
Usually in infringement suits, a patent's validity is attacked (i.e. the plea of nullity is raised), and one intensely discussed and contentious method for cross-border litigation concerns the use of the objection of nullity in an infringement suit as a way of widening the court's ruling. This relies on Art. 16 No. 4 of the Brussels Convention, which states that in certain cases courts "shall have exclusive jurisdiction, regardless of domicile."
It goes on to state that one such occasions relates to "proceedings concerned with the registration or validity of patents, trademarks, designs, or other similar rights required to be deposited or registered." In such cases, it adds: the courts of the contracting state "in which the deposit or registration has been applied for, has taken place or is under the terms of an international convention deemed to have taken place" shall have such exclusive jurisdiction.
In certain cases, therefore, where the infringer lodges an objection of the nullity of the patent, a national court may decide that it can rule on all parts of a European patent that are being infringed by the same parties, effectively giving the respective national court exclusive competence for the foreign parts of the European patent as well as the national.
So if, for example, a Dutch entrepreneur is manufacturing a product in the Netherlands and selling it there, as well as in Germany, France and Belgium, and in doing so is infringing a European patent pertaining to these states, the court called upon to reach a decision on all acts of infringement may wish to take into account Art. 16 No. 4.
In a recent case the British High Court took precisely this view arguing that, if the defendant raises the objection of insufficient patentability for the disputed patent, courts of the state where the patent is granted have exclusive jurisdiction.
So if one followed the opinion of the British High Court, it is likely that in the majority of cases where the patent's validity were challenged there would no longer be any room for decisions with cross-border effect, as national courts would be able to claim exclusive competence. It should be added, however, that the British decision has not been generally accepted throughout the European Union.
Dealing with multiple infringers
But while such an approach may be successful in dealing with one infringer, what happens if several companies, each with their domiciles in different European states, are found to be infringing a European patent separately and in parallel, and each in different states?
Let us suppose, for example, that a patent owner has a European patent covering Germany, the Netherlands and Great Britain and that patent is being infringed by different companies registered in the three aforementioned states, all selling the same product?
Clearly in such circumstance it would be far more convenient and less expensive if the owner of the patent were able to go before only one court to stop all the infringers. The problem is that the principle for civil proceedings states that the defendants should all be sued in a court based in their country of domicile, and in the case above the infringers are all domiciled in different states.
This of course implies that the German company would have to be sued in Germany, the Dutch company in the Netherlands and the British company in Great Britain. I.e. three separate actions in three different courts.
However, Art. 6 No. 1 of the Brussels Convention seems to offer a solution favourable for the patent owner. This states that a person domiciled in a contracting state may also be sued: "where he is one of a number of defendants, in the courts for the place where any one of them is domiciled."
The Dutch approach
However, the meaning of Art. 6 No. 1 has been interpreted differently in various national courts. The courts of first instance in the Netherlands, for example, have historically taken a particularly liberal view, and affirmed their competence on the basis of this regulation. And unsurprisingly, where possible, patent owners have tended to turn specifically to the Dutch courts, and a number of decisions with cross-border effect have been issued as a result.
In circumstances such as the case described above, therefore, a patent owner could hope to see an infringement decision against both the company resident in Germany, and the British company (in addition to the Dutch company) as a result of one action in one court.
The disadvantage for defendant companies in such circumstances, of course, is that they face being sentenced by a foreign court.
The Dutch approach - which has been violently criticised throughout Europe - was based on the opinion that, despite the fact that after grant European patents divide into a bundle of national patents, they should be treated as having a sufficiently uniform legal basis. This being the case, a uniform decision on the respectively infringed national parts of the bundle in a uniform procedure would be justified.
However, in a more recent decision of the Gerechtshof te 's Gravenhage in The Hague, the range of application of Art. 6 No. 1 of the Brussels Convention was substantially limited. In reaching its decision, the Gerechtshof emphasised the exceptional character of this regulation and underlined that, in principle, the courts of the Contracting State in which the defendant is registered (see Art. 2 (1) of the Brussels Convention) should be responsible for such rulings.
It did nevertheless, add that the regulation should come into play, exceptionally, if a sufficiently close connection exists between the actions. I.e. where common proceedings and one decision appear advisable, particularly where contradicting decisions on the case need to be avoided.
In the opinion of the Gerechtshof, however, this connection cannot be deduced merely from the fact that the lawsuit concerns a European patent. The court argued that the legal nature of the European patent which, after its grant, separates into a bundle of national patents, is such that its continuance is intrinsically independent and completely limited to the respective sovereign territory in each state in which it obtains effect. In principle, therefore, differing judgements from various national courts over infringement disputes would be unavoidable, and were consciously accepted by the respective states when they concluded the European Patent Convention.
So in what circumstances can the aforementioned connection be deemed to exist? The Gerechtshof argued that this was where the different businesses belonged to a company group selling identical products on different national markets - although it should be added that Art. 6 No. 1 of the Brussels Convention states that the area of jurisdiction rests only with the court of the state in which the appropriate head office of such a company group is based, and which, in its executive role, has and/or creates the business strategy concerned.
So the implications of the new Dutch jurisdiction, are that:
* Art. 6 No. 1 of the Brussels Convention applies, if a sufficiently close connection exists between the individual complaints against the companies resident in different states, or
* A sufficiently close connection can be said to exist where the companies belong to the same company group.
Other approaches to cross-border litigation
A number of other articles of the Brussels Convention have been used by courts as a way of dealing with cross-border litigation, including Art. 21. Art. 21 states that: "Where proceedings involving the same cause of action and between the same parties are brought in the courts of different contracting states, any court other than the court first seised [applied to] shall of its own motion stay its proceedings until such time as the jurisdiction of the court first seised is established."
Additionally, it states: "Where the jurisdiction of the court first seised is established, any court other than the court first seised shall decline jurisdiction in favour of that court."
Some courts have interpreted this to mean that, even if a court of a certain contracting state is not internationally competent, the alleged patent infringer can apply to this incompetent court in order to release the mechanism specified in Art. 21 of the Brussels Convention. This could, for instance, be achieved with a simple negatory action (i.e. revocation) which, according to the European civil law, corresponds to an action for fulfilment of obligations (i.e. a requirement to abide by the terms).
What does this mean in practice? Suppose, for example, that the alleged patent infringer applies to an incompetent court (i.e. one that does not have jurisdiction) in State A, with a request to note that they do not infringe a certain European patent. In such a situation, any court of another contracting state receiving an application by the injured party (the owner of the patent) after the alleged infringer has applied to the court in State A, would suspend the procedure until the court in State A had legally declared itself incompetent.
Such an action would give the alleged infringer at least the possibility of considerably postponing a potentially unfavourable decision, and allow them to continue unhindered in their alleged infringements of the patent until the matter was resolved by the first court.
Bypassing the blockade
Where an alleged infringer resorts to this "blockade" approach, however, the patent owner may be able to make use of Art. 24 of the Brussels Convention. This states that "Application may be made to the courts of a contracting state for such provisional, including protective, measures as may be available under the law of that state, even if, under this Convention, the courts of another contracting state have jurisdiction as to the substance of the matter."
In other words, it is arguable that it is possible to bypass the "blockade" brought about by the mechanism of Art. 21 of the Brussels Convention, by using the provisional measure stated in Art. 24 of the Brussels Convention. This regulation allows for the fact that provisional measures provided for in the law of a contracting state can be called upon by a court of the state in question even if, on the basis of the convention, the court of another contracting state is primarily competent for the decision as to the substance of the matter.
It could follow from this that a court would then also be able to pass a provisional measure forbidding a further infringement of a patent, even if its competence as to the substance of the matter is in question as a result of Art. 21 - since the case had been already brought before another national court in form of a negatory action.
Consequently, in the case described above, by means of a provisional measure from the court in State B, the alleged patent infringer could still be prevented from committing further acts of infringement. This would be possible even though the alleged infringer had raised a negatory action via the court first called upon in State A, and had thus caused the suspension of the infringement complaint raised later by the owner of the patent in State B.
These matters have not yet been clarified conclusively by the European courts, and they remain very contentious and unclear. Moreover, a negatory action pending in another contracting state can very probably influence the conditions for the decree of a provisional decision, or a preliminary injunction, as if the validity of the patent is in question, many courts refrain from rendering a provisional measure.
Conclusions
The points raised in this article are intended to provide an overview of how a European patent can be litigated in an infringement suit in a cross-border situation. It should be pointed out, however, that so far most of the actions referred to have not been clarified at national level, and none at all at a European level. And since the judicial implementation of European patents is the business of the member states of the European Patent Convention, it is possible that an agreement will never be reached at European level.
Moreover, although the European Commission plans to introduce a Community patent - which would be valid for the entire sovereign territory of the Community and would likely coincide with the creation of an international court of instance for law disputes, and lead to uniform jurisdiction for the coming Community patent - any such court would concern itself with the Community patent alone, and not with European or other national patents.
This article has been kindly supplied by the Intellectual property Rights Helpdesk, established by the European Commission, and based in Luxembourg (http://www.cordis.lu/ipr-helpdesk).
News 
Market Data 
Discover 
AI
