Posts Tagged Reflexive application
Central Santa Lucia L.C. v. Meliá Hotels International S.A.: Spanish court obiter applying Article 24 Brussels Ia reflexively ex-EU (Cuba).
Thank you Antonio Pastor for signalling Central Santa Lucia L.C. v. Meliá Hotels International S.A., litigation on which also more background here. The Spanish courts at MAllorca (appeal expected) have declined jurisdiction concerning confiscated property in Cuba after the end of suspension of Title III of the Libertad Act (the “Helms-Burton Act”, well known to trade and international lawyers alike) on the basis of sovereign immunity, as Antonio explains.
However as I understand Antonio’s summary (I fear I do not have Spanish to consult the judgment myself), the Court obiter also applied Article 24(1) Brussels Ia reflexively: if Brussels Ia grants exclusive jurisdiction to the courts of the Member State in which the property is situated in proceedings which have as their object rights in rem in immovable property or tenancies of immovable property, then EU Courts should decline jurisdiction if that real estate happens to be located ex-EU. Readers will remember the discussions on this issue in one or two earlier postings on this blog.
Interesting, to say the least.
(Handbook of) EU private international law, 2nd ed. 2016, Chapter 2, Heading 2.2.6.
Huawei v Conversant wireless. Reflexive application of patent validity jurisdiction confirmed in principle – but rejected in casu.
In  EWCA Civ 38 Huawei v Conversant Wireless (on appeal from  EWHC 808 (Pat) the Court of Appeal considered whether in the event of 2 defendants being UK based (the others domiciled in China) the UK courts may relinquish jurisdiction reflexively to honour Article 24(4) Brussels Ia’s exclusive jurisdictional rule for the validity of patents.
Neither Article 33’s lis alibi pendens or Article 34’s ‘forum non conveniens’ rule were discussed.
Huawei China and ZTE China have commenced proceedings in China against Conversant, seeking to establish invalidity and (in the case of Huawei China only) non-infringement of Conversant’s Chinese patents. Conversant have inter alia sued Huawei China and ZTE China in Germany for infringement of its German patents.
Following Owusu, jurisdiction for infringement of UK patents against UK incorporated companies must lie and remain with the English courts per Article 4 B1a. As readers will remember from my review of Ferrexpo, the English courts for some time however have noticed with relish that the CJEU in Owusu did not entertain the part of the referral which asked it whether exclusive jurisdictional rules may apply reflexively – holding thereafter in the CJEU’s stead that they might so do (in a discretionary: not a slavish fashion: Floyd J here at 115).
At 95 ff Floyd J discusses the issues after having summarised the various representations made (see a summary of the summary by John de Rohan-Truba here), with much of the discussion turning on English CPR and jurisdictional rules, and reflexive application of Article 24(4) confirmed in principle, but not applied here. Requests to refer to the CJEU were summarily dismissed.
(Handbook of ) European Private International Law, 2nd ed. 2016, Chapter 2, Heading 22.214.171.124, Heading 126.96.36.199.
Update 31 August 2018 the merits of the case were subsequently held in August 2018,  EWHC 2264 (Pat).
End of exam season (sadly not yet of marking marathon). In the next few weeks I shall be posting on judgments issued a little or longer while ago, which I was pondering to use in exams. (I did for some of them).
In  EWHC 1216 (Pat) Chugai Pharmaceutical v UCB the issue at stake was to what degree a suit seeking to establish absence of liability under a patent license, in reality provokes argument on the validity of the patent. Carr J has excellent review of precedent, much of which has passed in one way or another on this blog. Please do refer to judgment for proper reading.
Claimant (“Chugai”) seeks a declaration against the Defendants (collectively “UCB”) that it is not obliged to continue to pay royalties under a patent licence (“the Licence”) granted by the First Defendant (“UCB Pharma”). UCB Pharma is a Belgian company with an English branch which entered into the Licence with Chugai in respect of a portfolio of patents. Chugai claims that its products, which are, in part, manufactured and sold in the USA, fall outside the scope of the claims of the Patent concerned. Accordingly, Chugai seeks a declaration that it owes no royalties for the manufacture and sale of these drugs manufactured after a certain date.
UCB alleges that, although framed as a claim for a declaration relating to a contract, a part of these proceedings, in substance, concerns not only the scope but also the validity of the Patent. UCB submits that the validity of a US patent is non-justiciable, since the English court has no power to determine the validity of a foreign patent. Accordingly, it submits that those parts of Chugai’s pleading which are said to raise issues of invalidity fall outside the subject matter jurisdiction of the English court.
European private international law as readers will know lays greats emphasis on exclusive jurisdiction in the case of validity of patents. The CJEU’s holding in C-4/03 Gat v Luk that nullity actions against a national part of a certain European patent can only be conducted in the jurisdiction for which that patent was registered, regardless of whether the nullity argument is raised in the suit or by way of defence, is now included verbatim in Article 24(4) Brussels I Recast. The EU’s take is rooted in the idea that the grant of a national patent is “an exercise of national sovereignty” (Jenard Report on the Brussels Convention (OJ 1979 C59, pp 1, 36)). The rule therefore engages the Act of State doctrine, and suggests that comity requires the courts of States other than the State of issue, to keep their hands off the case.
Particularly in cases where defendant is accused of having infringed a patent, this rule gives it a great possibility to stall proceedings. Where the action is ‘passive’, with plaintiff aiming to establish no infringement, the argument that the suit really involves validity of patent is less easily made.
The possibility of ‘torpedo’ abuse, coupled with less deference to the jurisdictional consequences of the Act of State doctrine [particularly its contested extension to intellectual property rights], means the English courts in particular are becoming less impressed with the exclusivity. (Albeit Carr J on balance decides per curiam (at 73-74) that direct challenges to the validity of foreign patents should not be justiciable in the English courts). Where the EU Regulation applies, they do not have much choice. Carr J refers to  EWHC 1722 (Pat) Anan where claimant sought to carve out issues of validity by seeking a declaration that the defendant’s acts infringed a German patent “if the German designation is invalid (which is to be determined by the German courts)“. EU law meant this attempt could not be honoured. Carr J however suggests that EU rules have no direct application in the present case because the Patent at stake is a United States patent. That is spot on, on the facts of the case: choice of court having been made in favour of the English courts, the case does not fall under the amended lis alibi pendens rule of the Brussels I Recast. In Article 33 juncto recital 24, reflexive effect is suggested for the Regulation’s exclusive jurisdictional rules, leaving a Member State court in a position (not: under an obligation) to give way to pending litigation in third countries, if its own jurisdiction is based on a non-exlusive jurisdictional rule (Articles 4, 7, 8 or 9) and not within the context of the protected categories.
Allow me to lean on 20 Essex Street’s conclusion in their review of the case: Carr J held that the case before him was not a direct challenge to validity. He accepted Chugai’s submissions that its claim was contractual. Disputed parts of the patent were incidental to the essential nature of its claim, which was a claim for determination of its royalty obligations. In his view, this claim fell within the exclusive jurisdiction clause, in favour of the English courts, which parties had agreed.
Essential reading for IP litigators.
(Handbook of) EU Private international law, 2nd ed. 2016, Chapter 2, Heading 188.8.131.52.
Update 29 December 2017. In Milieudefensie et al v The Netherlands the Rechtbank Den Haag was less accommodating to plaintiff in similar public interest litigation involving air pollution. Arguments included Directive 2008/50, WHO health standards, and Articles 2-8 ECHR. It is clear that cases like these will continue to be brought, and will not always side with environmental action groups. Yet there is no doubt that they are an essential part in making Governments sit up and take proper action rather than relying on the separation of powers principle effectively to do nothing. (Greenberg Traurig have good review here).
nUpdate 12 November 2015: the Belgian case has been held up due to the language regime in Belgium’s civil procedure rules.
I have reported previously on this action, when it was launched. The Court at The Hague held late June. For good (and impressive) measure, it immediately released an English translation of the judgment. Jolene Lin has excellent overview here, I will simply add the one or two things which I thought were particularly striking.
Firstly, this judgment was not written by a bunch of maverick ‘environmental’ judges. It is the commercial court at The Hague which issued it (see the reference to ‘team handel’, ‘handel’ meaning commerce, or trade).
The judgment hinges on the State’s duty of care which the court established. Urgenda, applicant, had suggested that regardless of the individual behaviour of Dutch citisens and corporations, the Government carries overall or ‘systemic’ responsibility (‘systeemverantwoordelijkheid’), as the representative of the sovereign Dutch nation, to ensure that it controls emissions emanating from The Netherlands. Article 21 of the Dutch Constitution and the international no harm (sic utere tuo) principle featured heavily in the court’s acceptance of the State duty of care. That the Dutch action might only be a drop in the ocean, did not impress the judge: plenty of pennies make a pound, and at any rate, The Netherlands, as a developed nation, were found to have increased responsibility.
At 4.42 and 4.43, the Court then applies what in EU law is known as the Marleasing principle.
‘From an international-law perspective, the State is bound to UN Climate Change Convention, the Kyoto Protocol (with the associated Doha Amendment as soon as it enters into force) and the “no harm” principle. However, this international-law binding force only involves obligations towards other states. When the State fails one of its obligations towards one or more other states, it does not imply that the State is acting unlawfully towards Urgenda. It is different when the written or unwritten rule of international law concerns a decree that “connects one and all”. After all, Article 93 of the Dutch Constitution determines that citizens can derive a right from it if its contents can connect one and all. The court – and the Parties – states first and foremost that the stipulations included in the convention, the protocol and the “no harm” principle do not have a binding force towards citizens (private individuals and legal persons). Urgenda therefore cannot directly rely on this principle, the convention and the protocol. (….)
This does not affect the fact that a state can be supposed to want to meet its international-law obligations. From this it follows that an international-law standard – a statutory provision or an unwritten legal standard – may not be explained or applied in a manner which would mean that the state in question has violated an international-law obligation, unless no other interpretation or application is possible. This is a generally acknowledged rule in the legal system. This means that when applying and interpreting national-law open standards and concepts, including social proprietary, reasonableness and propriety, the general interest or certain legal principles, the court takes account of such international-law obligations. This way, these obligations have a “reflex effect” in national law.‘
In this respect the court also referred extensively to the European Court of Human Rights’ case-law on the duty of a State to put into place a legislative and administrative framework to address the challenges posed by dangerous activities.
The Court also, with reference to international scientific consensus, concluded that climate mitigation, rather than adaptation, is the more effective, efficient and least expensive way to address climate change.
Eventually it settles for a finding of duty of care and ensuing responsibility to reduce the emission of greenhouse gases by at least 25% viz 1990 levels, by 2020. This 25% is the floor of what the international scientific community suggests is needed properly to address the dangers of climate change. (The court, in deference to trias politica, therefore did not want to go higher than that floor).
Next up (other than appeal, one might imagine): the Belgian courts, which have been seised of a similar action.
Declaration of interest: I advice the Belgian litigation pro bono.