Tag: Onrechtmatige daad

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Jurisdiction, intellectual property and the internet. Might CRUZ VILLALÓN AG in Pez Hejduk introduce the end of Bier?

Let me answer the question immediately: that is unlikely. It is however an interesting prospect and, who knows, might be a start. CRUZ VILLALÓN AG’s Opinion in Pez Hejduk, case C-441/13 (at the time of writing available in plenty of languages but not in English), provides an excellent tour d’horizon of the application of the special jurisdictional rule of Article 5(3) [following the recast, Article 7(3)] Brussels I, to cases involving infringements of an intellectual property right.

For trademarks, the most recent case is Coty, Case C-360/12, reviewed by Alberto Bellan here. Pez Hejuk concerns copyright: an intellectual property right for which no formality (such as registration) is required for it validly to exist. Pinckney, Wintersteiger, Football Dataco: the application of Article 5(3) [and the delineation with leges specialis in the IP field] is not exactly crystal clear and the need for distinguishing very high. This resulted in this particular case in the Handelsgericht Wien requesting ECJ back-up on the application in the case of Ms Hejduk, a professional photographer, suing EnergieAgentur for unauthorised use on its .de website of photographs which had only been authorised for one-off use during a conference.

In view of Pinckney et al, the AG splendidly and concisely distinguishes the various strands of case-law and the raison d’etre for their consecutive jurisdictional criteria – please refer to the opinion itself for a summary by me would not do it justice. Encouraged in particular by Portugal and the EC, the AG then further distinguishes current case. As noted by Eleonora Rosati here, the AG emphasises that not only would it be difficult for the defendant having potentially to face actions in multiple Member States, but also the plaintiff would have limited benefits from seeking limited damages in more jurisdictions, and would find it difficult to prove such damage given the accessibility of the site.

Which is why the AG suggests that further distinguishing is needed for what he calls cases involving ‘delocalised damages’ involving IP, leading to the suggestion that in such case, only the judges of the Member State in which the causal event occurred should have jurisdiction on the basis of Article 5(3) (general jurisdiction for the domicile of the defendant not withstanding, obviously: per Article 2 JR). In other words: only the locus delicti commissi would be upheld. Not the locus damni.

Now, no reference is made to the case in the AG’s Opinion, however, surely this amounts to no less than a reversal of Bier /Mines de Potasse d’Alsace, case C-21/76. the ECJ’s extension in Bier, away from the literal meaning of Article 5(3) has, as I often have emphasised, triggered a long series of cases in which the ECJ has had to massage the ripple effect of the locus damni rule. If it were (which of course is not at all certain) to take up the AG’s suggestion here, and drop locus damni, might it not eventually have to concede that in many if not all cases, it is difficult for the defendant having potentially to face actions in multiple Member States, and for the plaintiff to have to prove and seek limited damages in more jurisdictions.

On that basis (that however narrowly distinguished, siding with the AG would mean acknowledging the weakness of the locus damni rule), I find it very likely that the ECJ will not run with it. Whence it might either not distinguish Hejduk from Pinckney, or assimilate it with eDate Advertising, or further distinguish and add an alternative, Hejduk rule, in the event of ‘delocalised damages’.

One to look out for!

Geert.

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Pike & Doyle (Mumbai terror) at the High Court: forum non conveniens and the need for distinguishing Rome II and Brussels I

In Pike & Doyle v the Indian Hotels Company Limited, the High Court upheld its jurisdiction in the case of two (surviving but injured) victims of the Mumbai terror attacks. The UK Human Rights Blog has a posting on the forum non conveniens side of the case. I would like to point to some interesting observations in the judgment on the impact of the interpretation of the special jurisdictional rule for tort under the Jurisdiction Regulation (Brussels I).

The First Claimant suffers continuing pain and loss of amenity and substantial economic losses caused by his injuries. The Second Claimant sustained loss of earnings in England and Wales and has a continuing loss in the form of counselling. On that basis both Claimants have therefore suffered indirect or secondary damage as a result of the Defendants’ alleged negligence in Mumbai. The Claimants’ submission is that this is sufficient to found jurisdiction. The Defendants challenge this.

In support of their claim, defendant relied essentially on the impact which EU law suo arguendo has  on the interpretation of the relevant English rules of procedure: as summarised by Stewart J (at 12):

The Defendants’ submission is as follows:
(i) Before 1 January 1987 RSC order 11 rule 1(1)(h) required a plaintiff to establish that the action was “founded on a Tort committed within the jurisdiction”. The test was “where in substance did the cause of action arise?” (Distillers Co Ltd v Thompson [reference omitted]).
(ii) On 1 January 1987 the rule changed such that the new RSC order 11 rule 1(1)(f) became “the claim is founded on a Tort and the damage was sustained, or resulted from an act committed, within the jurisdiction.” The change was made to give effect to Article 5(3) of the Brussels Convention and the decision of the European Court in Handelskwekerij G.J. Bier B.V. v Mines Potasse d’Alsace S.A. [reference omitted]
[references to further precedent omitted]
(iii) The European Rules do not allow indirect secondary damage to found jurisdiction.
Dumez France v Hessische Landesbank [reference omitted]). Marinari v Lloyds Bank plc [reference omitted]). [references to further precedent omitted]
(iv) This is all accepted and is in line with the original Bier case where the European Court held that where an act occurred in one Member State and the damage occurred in another, the Claimant could sue the Defendant in the Courts of either state. (…)
(v) Given the above, the Court should apply normal principles of interpretation to the rule namely: delegated legislation is construed in the same way as an Act, the starting point is to ascertain the legislative intention and the person seeking to understand that intention must do so in the light of the enactment and its purpose. The interpretation must be an informed one [references omitted]
(vi) Therefore since the pre 1987 law would not have allowed indirect secondary damage to found jurisdiction and since the purpose of the change was to align the RSC (subsequently CPR) with the European rules which do not allow such a founding of jurisdiction, the rules should be interpreted consistently with the European cases.

 

Stewart J disagreed and precedent did before him. Absent the European context – for defendant is not domiciled in the EU and the Brussels I-Regulation does not otherwise apply, there is no reason to assume that the relevant English rules cannot be applied taking into account indirect damage as a jurisdictional basis for the English courts: Tugendhat J had already held so with reference to the preparatory works of the relevant change to the Rules of Procedure. He effectively found that Parliament did not fully assimilate the rules relating to non party states with those relating to states which are a party; it effectively wanted their to be a wedge between the application of the jurisdictional rule for tort in and outside the Brussels-I context.

Neither, Stewart J held, can Rome II come to the defendants’ rescue. This was an attempt by defendants to recycle the limitation to Article 5(3) of the Brussels I Regulation. No reference to this was made in the judgment however a prima facie forceful recital in the Rome II Regulation is recital 7: The substantive scope and the provisions of this Regulation should be consistent with Council Regulation (EC) No 44/2001 of 22 December 2000 on jurisdiction and the recognition and enforcement of judgments in civil and commercial matters (Brussels I) and the instruments dealing with the law applicable to contractual obligations.

Since Rome II harmonises applicable law for tort even if the national court upholds jurisdiction on the basis of its residuary jurisdictional rules (such as here, given that Brussels I does not apply), this bridge between the various Regulations might resurrect the relevance of the Dumez France and Marinari limitations to the judgment in Bier.

Stewart J however was not swayed and referred to Sir Robert Nelson in Stilyanou:

  • Brussels 1 relates to a different subject matter, namely jurisdiction, and has to be construed as a separate regulation, albeit consistently with the other regulations forming part of the compatible set of measures.
  • Rome II does not abolish the discretion which has to be exercised under the CPR in relation to non Member States.
  • Article 2 on its face is wide enough to include any damage direct or indirect which the regulation as a whole covers. Article 4(1) expressly excludes indirect damage which would otherwise be included by virtue of Article 2. There is no reason why “damage” under the CPR should be interpreted as in a specific Article such as Article 4 which defines the applicable law, rather than interpreted as a general article such as Article 2 which applies to the regulation as a whole (apart from Article 4).
  • Inconsistencies in the meaning of damage may exist as the tests are different under Brussels 1, Rome II and CPR. The latter includes the exercise of the discretion and hence consideration of forum conveniens to ensure the proper place for the trial is selected, whereas Brussels 1 and Rome II do not.
  • Rome II does not concern jurisdiction and does not override CPR 9(a). Where Brussels I does not apply, the issue of jurisdiction will be governed by a country’s own rules ie. in England and Wales the CPR

Neither Stewart J nor Sir Robert refer to recital  7 Rome II however their arguments in my view are supported post their findings by the ECJ judgment in Kainz.

A very interesting case for many aspects of conflicts law.

Geert.

 

 

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Jurisdiction in copyright infringement with the involvement of the internet – The ECJ in Pinckney is satisfied with accessibility

[postscript 4 February 2014: the Cour de Cassation held on 22 January 2014, following the ECJ’s lead.]

I reported earlier on the AG’s Opinion in Pinckney. The ECJ held this morning.  The questions were held admissible (see my fear that the Court might side with the AG’s suggestion of the opposite).

Pro memoria: the case concerns an alleged infringement of a copyright which is protected by the Member State of the court seised (France), that court questioning its jurisdiction to hear an action to establish liability brought by the author (who lives in France) of a work against a company established in another Member State (Austria), which has in the latter State (Austria) reproduced that work on a material support which is subsequently marketed by companies (Crusoe and Elegy) established in a third Member State (the UK) through an internet site which is also accessible in the Member State of the court seised (France).

The Court of Appeal at Toulouse) held that the Tribunal de grande instance de Toulouse lacked jurisdiction on the ground that the defendant is domiciled in Austria and the place where the damage occurred cannot be situated in France, and that there was no need to examine the liability of Mediatech and Crusoe or Elegy in the absence of any allegation of collusion between them and Mediatech. The Cour de Cassation referred to the ECJ.

The ECJ concisely sets out its case-law in intellectual property rights vs personality rights infringements – I will not repeat the exercise here.  It emphasises the (in my view conceptually wrong) link between applicable law and jurisdiction in the case of special jurisdictional rules. Unlike the AG, however, the court does not withhold ‘focus and target’ of the website as a criterion for jurisdiction. ‘(T)he possibility of obtaining a reproduction of the work to which the rights relied on by the defendant pertain from an internet site accessible within the jurisdiction of the court seised‘ (emphasis added) suffices.  However if locus damni is the only jurisdictional ground for that Member State, that court, per the Shevill rule, only has jurisdiction to adjudicate on the damage caused in that Member State.

No doubt the IP community will chew a bit more on the judgment. The patchwork of litigation possibilities in IP infringement cases remains a challenge.

Geert.

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No big surprises in Dutch Shell Nigeria / Royal Dutch Shell ruling

Postscript/2015: Shell’s arguments in appeal (in Dutch) on the specfic issue of jurisdiction, may be found here

As reported earlier, Shell’s top holding has been hauled before a Dutch court by a Dutch environmental NGO (Milieudefensie), seeking (with a number of Nigerian farmers) to have the mother holding being held liable for environmental pollution caused in Nigeria. Judgment came yesterday and generally is quite comforting for Shell (and other holding companies in similar situations).

The court stuck to its decision to join the cases, hence allowing Shell Nigeria to be pursued in the Dutch Courts, together with the holding company (against which jurisdiction was easily established under the Brussels I Regulation).  On this point, one imagines, Shell might appeal.

The court held against application of the Rome II Regulation for temporal reasons and did therefore not entertain any (unlikely) options in that Regulation which may  have led to Dutch law: the events which gave rise to the damage occurred before the entry into force of that Regulation. The Court therefore applies lex loci damni. If I am not mistaken, prior to Rome II, The Netherlands applied a more or less complex conflicts rule, not necessarily leading to lex loci damni, neither to lex loci delicti commissi, which was the rule in most EU Member States prior to the entry into force of the Rome II Regulation.

Nigerian law applied and any route to apply Dutch law was rejected.  Incompatibility with Dutch ordre public, for instance, was not withheld. Nigerian law running along common law lines, the court ran through negligence in tort, applied to environmental cases, leading amongst others to the inevitable Rylands v Fletcher. The  court found that the damage occurred because of sabotage, which under Nigerian law in principle exhonerated Shell Nigeria. Only for two specific instances of damage was liability withheld, for Shell Nigeria had failed to take basic precautions.

The conditions of Chandler v Cape (2012) to establish liability for the holding company, were not found to be met in the case at issue. The court did not establish a specific duty of care under Nigerian law (with the loop to the English common law) for Royal Dutch Shell (RDS), the mother company. A general CSR committment was not found not to alter that.

No doubt to be continued in various forms of appeal.

Geert.

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