Jurisdiction and Intellectual Property

Written jurisdiction clause

para. 14-020 In Knorr-Bremse [2008] EWHC 156, the High Court of England held that a jurisdiction clause in a settlement agreement entered into between two parent companies did not bind a UK subsidiary. The defendant, in seeking a stay of the proceedings, argued that under German law (the law of the settlement agreement), the settlement agreement would bind a subsidiary. In applying C-269/95 Benincasa v. Dentalkit Srl [1997] E.C.R I-3767,[1997] E.T.M.R. 447, the Court rejected that argument. It held that in interpreting whether Art.23 of the Judgments Regulation was applicable, such had to be interpreted by reference to Community law and not to German law (which was the law of the settlement agreement). The court held that Art.23 had to be interpreted strictly as being only applicable to the parties to the agreement.

Lis alibi pendens

para 14-049. See Research in Motion v Visto [2008] EWCA 153 for the meaning of "related actions". See also News Article "ARt.28, Jurisdiction Regulation and Related Actions".

Infringement action where validity is put in issue

para.14-067 See Knorr-Bremse [2008] EWHC 156 where the High Court of England held that, on an application disputing jurisdiction, that it was not necessary that validity had been formally put in issue.

Determination of jurisdictional issues under the Brussels Convention

para 14-099 In Canada Trust v Stolzenberg [1997] EWCA 2592, the Court of Appeal held, in applying Seaconsar Ltd. V Bank Markazi [1994] 1 AC 438 (House of Lords), that the threshold was the same whether or not the preliminary jurisdictional issue was likely to be tried at the trial of the action. The Court said that Lord Goff's remarks in Seaconsar must have implicitly rejected the approach taken by Staughton LJ's remarks in Attcock Cement v Romanian Bank should not be followed. See also Knorr-Bremse [2008] EWHC 156

Intellectual property and relevant law

Rome II Regulation

para 14-105 The European Community has enacted Regulation 864/2007 which seeks to harmonise the law applicable to non-contractual obligations (Rome II). The regulation will come into force on 11th January 2009. Recital 26 makes it clear that with regard to infringement of IPRS, the universally acknowledged principle of the lex loci protectionis should be preserved. This principle stems from the territoriality of IPRs. Thus, a German patent can only be infringed in the territory of the Federal Republic of Germany and such acts will not infringe patent rights of other countries.

Proof of a foreign law may differ between Member States. In the United Kingdom, foreign law is generally presumed to be the same as English in the absence of expert evidence. However, in other countries such as Germany, an ex officio approach is taken whereby the court must determine the law of its own motion.

This is carried through to Art.8(1) which states that the applicable law shall be the law of the country for which protection is claimed. In an action for infringement of a unitary Community IPR i.e. a Community Trade Mark or Community Design, the relevant law for any question that is not governed by the relevant regulation is the law of the country in which the act of infringement was committed (Art.8(2)). In general, both the Community Trade Mark regulation and the Community Design Regulation have detailed rules concerning the jurisdiction of the courts of Member States in infringement and revocation actions of, respectively, Community Trade Marks and Community Designs.

Rome 1 Regulation

The European Community has now also adopted Regulation 593/2008 which seeks to harmonise the law applicable to contractual obligations (Rome I). The object of this regulation is to incorporate the Rome Convention into Community law. Thus, the regulation specifically replaces the Rome Convention (Art.24). However, the regulation goes further than the Rome Convention and specifically sets out the applicable law in any dispute. Thus, in a contract for the sale of goods, the applicable law governing the contract is where the seller has his habitual residence; for the supply of services, where the service provider has its habitual residence; in a franchise contract, where the franchisee has his habitual residence; in a distribution contract, where the distributor has his habitual residence (Art.4(1)). If the contract does not fall within Art.4(1), then the contract is governed by the law of the country where the party required to effect the characteristic performance of the contract has his habitual residence (Art.4(2)). This echoes Art.4(2) of the Rome Convention (see para 14-109 in book). Also, as an echo of the Rome Convention, if the circumstances of the case indicate that "the contract is manifestly more closely connected with" another country, then the law of the country shall apply (Art.4(3)). Finally, there is a sweep-up provision which states that if the applicable law cannot be determined under Art.4(1) or Art.4(2), then the contract is governed by the law of the counry "with which it is most closely connected".

Consumer contracts are an exception to the above rule. In such circumstances, they will governed by the law of the country where the consumer has his habitual residence (Art.6). However, this rule does not apply in certain circumstances e.g. where the services supplied are supplied to a consumer exclusively in a country where he does not have his habitual residence (Art.6(4)).

In general, the regulation makes it clear that parties are free to stipulate the applicable law to a contract (Art.3). Such has to be expressly or clearly demonstrated. Interestingly, Art.3(3) prevents parties from "contracting out" of the laws of a particular country where "all other elements relevant to the situation at the time of the choice are located in a country other than the country whose law has been chosen". This rule is extended to a Community-wide rule such that the parties cannot contract out of Community laws where all other elements points to a Member State's law being applicable (Art.3(4)). In the case of consumer contracts, the regulation permits the parties to choose the applicable law provided that such does not deprive the consumer of the protection afforded to him by the law of the country where the consumer has his habitural residence (Art.6(2)). Similar safeguards exist for employment contracts. Thus, a contract of employment cannot stipulate a law which would have the result of depriving the employee of protection afforded to him by a law which would have been applicable by Art.4 of the Regulation.

The Regulation comes into force on 17th December 2009 (Art.29).

Initially, the United Kingdom and Ireland did not participate in the adoption of Regulation 593/2008. However, the Commission Decision 22.12.2008 (2009/26/EC), the United Kingdom indicated its intention to accept and this was formally approved. [2009] OJ L10/22