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Jurisdiction of the European courts in cross-border patent infringements – ECJ BSH v Electrolux
Another landmark decision by the ECJ on the international jurisdiction of the courts of the EU member states is causing a huge stir as of late. On 25 February 2020, the ECJ published its long-awaited decision in the case BSH Hausgeräte vs Electrolux (C-339/22).
Background and questions referred
The starting point for the request for a preliminary ruling to the ECJ is a patent infringement case in Sweden. In 2020, BSH Hausgeräte GmbH filed a complaint there against Electrolux AB for infringement of all national elements of a European patent. The patent in suit was validated in Germany, Greece, Spain, France, Italy, the Netherlands, Austria, Sweden, the United Kingdom and Turkey.
Elektrolux objected to the admissibility of the complaint relating to infringement of the national parts, with the exception of the Swedish one. The core of the complaint was the objection that the non-Swedish patents were invalid and that the Swedish court therefore had no jurisdiction to rule on the infringement.
At the end of 2020, the court declared that it lacked jurisdiction for all non-Swedish patents on the basis of Art. 24 No. 4 Brussels Ia Regulation. BSH then filed an appeal against this. The Court of Appeal itself also bared doubts concerning the jurisdiction of the Swedish courts especially in light of the exception in Art. 24 No. 4 Brussels Ia Regulation.
Art. 24 No. 4 Brussels Ia Regulation provides an exception to the principle of the jurisdiction of the courts of the Defendant’s state of domicile (Art. 4 Brussels Ia Regulation). It stipulates that, the courts of the member state for which the European patent was granted have exclusive jurisdiction for proceedings “concerned with the […] validity of patents […]” irrespective of domicile. According to the further wording of the regulation, this jurisdiction applies “irrespective of whether the issue is raised by way of an action or as a defence”.
Based upon this background, the Swedish court of appeal stayed the proceedings and referred three questions to the ECJ for a preliminary ruling (summarised by the author).
1. Does a national court which has jurisdiction under Article 4 para. 1 Brussels Ia Regulation lose its jurisdiction to rule on the infringement action if the defence of invalidity of the patent in suit is raised or does the court merely lack jurisdiction to rule on the defence itself?
2. Does Art. 24 No. 4 Brussels Ia Regulation apply to third countries (non-EU)?
3. Can a national regulation affect the interpretation of Art. 24 No. 4 Brussels Ia Regulation?
The answers to questions 1 and 2 are likely to be highly relevant for patent infringement proceedings in the EU.
The decision
Assertion of a patent granted in another EU Member State
The ECJ first deals with the constellation in which the Claimant asserts a different national part of a European patent before the court of the Defendant’s EU domicile and the Defendant raises the defence of invalidity.
The jurisdiction of the court of domicile is based on Art. 4 para. 1 Brussels Ia Regulation, which, however, only establishes jurisdiction subject to the other provisions.
According to Art. 24 No. 4 Brussels Ia Regulation, the courts of the Member State that granted the patent have exclusive jurisdiction to decide on an attack of the validity of the patent, irrespective of whether such an attack is raised by way of an action or as a defence (codification ECJ GAT v LuK, C-4/03).
It follows from the GAT case law that a court dealing with proceedings for infringement of a patent granted by another Member State, in the context of which the validity of the patent is attacked, is not allowed to declare the invalidity of the patent incidentally. It must find that it has no jurisdiction over the question of the validity of the patent.
In addition, the ECJ now had to clarify whether the court of the Defendant’s domicile retains its jurisdiction to decide on the patent infringement action under such circumstances, or whether it must declare to generally have no jurisdiction over the dispute.
This is the point where it becomes intriguing, because the ECJ states that the court of domicile does not lose its jurisdiction over the infringement action. The considerations of the Court are convincing. In addition to the principle that exceptions to principles should be interpreted narrowly, the exception would become the rule if interpreted otherwise. This is because in the majority of patent disputes, the Defendant attacks the validity of the patent in suit. The Defendant would then not only have it in its own hands to withdraw the court’s jurisdiction through its own defence strategy but could also decide when to do so. A duly seized court would then have to declare itself without jurisdiction due to an act of the Defendant. This would lead to the termination of the proceedings due to the lack of a referral option. However, the Brussels Ia Regulation is intended to guarantee legal certainty precisely through a high degree of predictability of the jurisdiction rules.
The ECJ goes on to point out the advantages of its interpretation: This enables owners of IP rights whose IP rights are infringed by the same Defendant in several Member States to bundle their claims and receive comprehensive compensation in a single place of jurisdiction. This also avoids the risk of conflicting decisions.
Anyone who may now think that the ECJ is depriving the Defendants of the defence to attack the validity needs to study the ECJ’s judgment further. This is because it explicitly states that the separation of infringement and validity does not mean that the infringement court must disregard the fact that the Defendant has duly filed an action for revocation in another Member State. If the court of domicile considers that there is a reasonable and non-negligible possibility that the patent will be declared invalid, it may stay the infringement proceedings.
Assertion of a patent granted in a third country
In addition, the ECJ had to decide on the jurisdiction of the court of domicile if the Claimant asserts a patent granted in a third country.
Firstly, the ECJ states that the Brussels Ia Regulation is an internal jurisdiction regulation of the EU. Art. 24 No. 4 Brussels Ia Regulation can therefore not apply nor assign jurisdiction to a court of a third country.
In the absence of special provisions, the jurisdiction to rule on the invalidity defence remains with the court of domicile in accordance with Art. 4 I Brussels Ia Regulation. The Lugano Convention (Norway, Iceland, Switzerland), for example, contains a provision corresponding to Art. 24 No. 4 Brussels Ia Regulation. Bilateral agreements with other third countries may also play a role. If such agreements do not exist, as in the case of Turkey, Art. 33 and Art. 34 Brussels Ia Regulation must also be observed.
Furthermore, the jurisdiction to rule on the invalidity defence remains with the court of domicile according to the ECJ’s decision. According to the ECJ’s findings, this does not violate the principle of non-interference under international law (a state may not interfere in matters that essentially fall within the national jurisdiction of another state). This is because the decision on the validity in the context of a defence in infringement proceedings does not formally have any effect on the actual existence or content of the patent in the third state. According to the ECJ, such a decision only has inter partes effects, as the defence is only aimed at obtaining the dismissal of the complaint and not the revocation of the patent.
Practical effects
As tempting as it may sound to proclaim the simple bundling of all infringement claims before one court, the devil is in the detail.
Firstly, a suitable Defendant is required that is domiciled in the appropriate EU Member State. This Defendant may now be accused of all acts of infringement within and outside the EU. However, they must be acts of infringement by this Defendant. The details of the group structure and the organisation of the distribution chain are of importance here.
Once such a Defendant has been found, the court of domicile can be asked to rule on the patent infringements in several countries. Whether such an action on the Claimant’s side will be successful depends on the Claimant’s own preparation and the reaction of the Defendant. In addition to the presentation of the acts of infringement, the assessment of the infringement and the validity is governed by law of the state for which protection is sought (Art. 8 para. 1 Rome II Regulation). The Claimant must therefore present the infringement in accordance with the law of the granting state and, if necessary, provide evidence in this regard.
Claimants who wish to make use of the ECJ’s new case law must therefore overcome several hurdles, which may incur a heftier or lesser workload. As such it is still necessary to examine very carefully whether the expected effort and the possible delays in infringement proceedings correspond to the interest and economic expectations of the infringement proceedings.
Finally, these principles must now be transferred to the UPC. According to Art. 3 UPCA, the UPCA applies to all EPs with unitary effect and all EPs for which no opt-out has been declared. In this respect, the scope of these IP rights is limited to the contracting member states of the UPCA. These are in turn divided into EU and non-EU states. The court will then proceed as described above. In this respect, the Local Division Düsseldorf has already anticipated the decision of the ECJ in its decision Fujifilm vs Kodak (judgement 28.01.2025, CFI_355/2923) and correctly declared itself competent to decide on the UK part of an EP. However, due to doubts about the legal status of the case, the infringement was no longer relevant (for more on this, see the blog article by my colleague Carsten Plaga).