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Cross-Border Actions For Patent Infringement

Gregor Grant, Partner

Many patent infringement actions have a cross-border element, often because infringements are taking place in several countries. The patentee has a choice of jurisdictions. Lawyers will tell him that some countries are quicker than others, that some are more expensive than others, and that some others are unknown quantities because they do not deal with many patent actions. It is not always easy to weigh up the pros and cons of using one jurisdiction as opposed to another. And running litigations in two or more jurisdictions at the same time is expensive in terms of money and manpower.

In these situations it is worth looking at ways in which actions can be combined – for example by finding a court which clearly has jurisdiction over the defendant and then seeking to persuade that court to enforce not only the domestic patent but also one or more corresponding patents in other countries – maybe against that same defendant, or maybe against associated companies.

There have been several strategies used by patentees in different places, and in recent years these strategies have had mixed success. Most businesspeople and judges see the merit in having cross-border patent disputes dealt with by the minimum number of courts, but the legal framework for doing this is unhelpful.

The basic problem is that the framers of the Brussels Convention on Jurisdiction, and its successor Regulation 44/2001, never really came to grips with the fact that there are almost always two aspects to a patent action – (i) has the patent been infringed, and (ii) is the patent valid? Under Article 22.4 of the Regulation, the only tribunal that can answer question (ii) is a court in the country in which the patent is granted or registered. So, although a British court might have jurisdiction over a locally based defendant alleged to infringe a patent in, say, Germany, only the German court can rule on the validity of that patent.

In Britain, issues of validity and infringement are seen as interlinked and often inseparable. If validity of a foreign patent is challenged, the British court will tend to give up any jurisdiction over the patent, even on an issue of infringement. 1

The courts in other countries, particularly the Netherlands, have taken a different view. By a variety of methods they have sought to maintain a position which would enable them to grant interim injunctions to restrain infringement of foreign patents, even where an invalidity issue was still to be dealt with by a court elsewhere.

There are several tricky issues in this field, which deserve the attention of the European Court of Justice so that different countries can try to operate in harmony. There has as yet been no decision from the ECJ, although there are two cases currently pending.

The first case – GAT v LuK - concerns infringement and validity of a French patent which was being litigated in Germany.  The Advocate General – the Court’s own lawyer - issued an opinion in the case in September 2004. The opinion did not give a firm recommendation as to what should happen when a court was considering a foreign patent and an issue of invalidity arose. Instead the opinion offers a range of options, one of which is that a decision on infringement should be put on ice until validity is decided by the national court which has jurisdiction under Article 22.4. There has not yet been a final decision by the ECJ.

In the meantime, a different Advocate General has issued an opinion in another action, Primus v Roche, a case which originated in the Netherlands. The main issue here is the viability of having a single, centralised infringement action rather than multiple actions in different national courts. Primus, a much smaller company than Roche, had been hoping that it would not be necessary for it to litigate its patent against Roche companies in a number of countries. It wanted the issue of infringement to be decided by one single court. It relied on Article 6.1. This addresses the issue of multiple defendants and seeks to avoid the risk of irreconcilable judgments resulting from separate proceedings. It can confer jurisdiction if claims are closely connected and can expediently be heard together.

The opinion recognises the desirability of a centralised system, but it acknowledges that no such system currently exists. There is no Community patent, and as yet no harmonisation of litigation procedures. On grant, a European patent becomes a bundle of separate national patents which, says the opinion, should be litigated in each jurisdiction separately. The European Patent Convention provides no framework for the avoidance of duplication of litigation in different countries, and no framework to deal with the possibility of irreconcilable judgments. This might be unsatisfactory, but it is the system we have.

It looks from this as though a multinational defendant may be able to require a patentee to litigate on several fronts.

This closing down of opportunities may be inevitable. Once a European patent is granted then (subject only to the centralised opposition procedure) it does indeed become a bundle of national rights. This carries with it the risk of different courts doing different things. The Advocate General in Primus v Roche takes a narrow line on what are “irreconcilable judgments” – if national patents are individual freestanding rights then there is no scope for anything to be irreconcilable.

A final ruling from the ECJ on both cases is awaited. The omens are that cross-border injunctions, even in the jurisdictions that currently favour them, will become more difficult.

There is a paradox here. A national court normally has jurisdiction over a local defendant in respect of civil wrongs committed by that defendant – whether it is negligent driving in Spain, or infringing a patent in France. That is the scheme of the pan-national arrangement on jurisdiction. But as soon as a question arises as to the validity of that French patent the national court runs into trouble. Jurisdiction over validity is exclusive.  It may be unrealistic to expect the ECJ to sort out the paradox in the GAT v LuK case. It is inherent in the system. And it may equally be unrealistic to expect the ECJ to broaden out Article 6.1 to allow a single action against defendants in cases with closely connected claims. The remedy for all the problems would lie in a harmonised litigation system or a re-framing of the Brussels Regulation. Both are distant prospects. There is broad support for a litigation agreement, except from the European Commission 2. And there is little chance of patents being given special treatment in a re-framed jurisdiction provision – and in any case there is no unanimity about what could be done on the vexed question of patents.

No date has yet been given for final judgment in either of these two pending cases, and there is currently no indication that the ECJ will be looking at them together.

In the meantime, the position in Britain remains this – if there is jurisdiction against a defendant (e.g. because the defendant is domiciled within the United Kingdom) then there is nothing to stop a patentee suing that defendant in a British court for infringement of a foreign patent. The patentee should be aware however that if there is a challenge to the validity of that patent then the court will in all likelihood prevent the patentee from continuing with that part of the claim.  But the onus is on the defendant to do something that will require the court to step in.

The defendant will also need to show that the issue of validity really is linked with the issues on infringement. If it is not, then there is still a chance of persuading a British court to retain jurisdiction in some manner over the issue of infringement (unless the ECJ in GAT v LuK closes that door). In a recent case, involving a licence dispute, the Patents Court in London made this observation:

“Courts and tribunals can and do decide issues of infringement separately from validity. The German courts do so all the time, so do patent offices…Where issues of validity and infringement are live, although, all other things being equal, we may prefer to try them together, this does not mean that they cannot be determined separately.”3

This approach would leave open the possibility of infringement of foreign patents being dealt with notwithstanding a validity challenge, perhaps by an interim injunction. But getting a British court to agree to Article 6.1 reaching multiple defendants in multiple jurisdictions is likely to be difficult, unless the ECJ in Primus v Roche decides to take a broader view than its own Advocate General.

Briefing Note, January 2006

Should you have any queries on this briefing note, please do not hesitate to contact Gregor Grant on ggrant@marks-clerk.com

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