UPC: (International) jurisdiction and UPCA Contracting Member State

The Local Division The Hague has issued an order dealing with the concept of a Contracting Member State and international jurisdiction of the UPC, among other things.

The order of the Local Division The Hague dated 19 June 2024 (UPC_CFI_130/2024, ACT_14944/2024) deals with a number of complex (procedural) issues: the interpretation of applications, the concept of a Contracting Member State within the meaning of the Agreement on a Unified Patent Court (UPCA), the international jurisdiction of the Unified Patent Court (UPC) and the urgency of applications for provisional measures.

In an order dated 19 August 2024 regarding the application for suspensive effect of the appeal, the UPC's Court of Appeal has also already commented on some of the above points.

Procedure

The application for provisional measures is based on an alleged infringement of the patent in suit EP 2 713 879 B1 (title: "Analyte sensor devices, connections, and methods"). The patent in suit is in force in Germany, France, the Netherlands and Ireland, which, according to the plaintiff and patent proprietor (Abbott Diabetes Care, Inc.), are all Contracting Member States of the UPCA. Initially, the patent in suit was withdrawn from the jurisdiction of the UPC (so-called "opt-out"), but the plaintiff declared its withdrawal from the opt-out before filing the application for provisional measures (see Rule 5.7 of the Rules of Procedure (RoP)). The defendants launched the allegedly infringing product on the European market at the end of 2023, and the application for provisional measures was filed on 20 March 2024. A protective letter (see Rule 207 RoP) was filed with regard to the patent in suit, which was forwarded to the plaintiff after the application was filed. Despite the protective letter, the plaintiff maintained its application. In its application, the plaintiff requested, inter alia, that the defendants refrain from infringing the patent in suit in all Contracting Member States of the UPCA in which the patent in suit is in force.

The defendants responded to the application and submitted a unilateral declaration to cease and desist, which, among other things, provided for the removal of the allegedly infringing product from the markets in Germany, France and the Netherlands. Against this background, the defendants argue that the application has been settled and should therefore be dismissed in accordance with Rule 360 RoP.

The decision of the Local Division The Hague – Interpretation of the application

First of all, the Local Division deals with the question of whether its jurisdiction also extends to Ireland. This is only the case if Ireland is a Contracting Member State of the UPCA. According to Art. 2 lit. c) UPCA, a Contracting Member State is a member state that is a contracting party to the UPCA. Ireland has signed the UPCA, ratification of the UPCA is, however, still pending. In the opinion of the Local Division, however, the signing of the UPCA is sufficient and it therefore considers Ireland to be a Contracting Member State of the UPCA, which is why the application must be interpreted in such a way that it also extends to Ireland.

International jurisdiction of the UPC

In this regard, the Local Division The Hague merely states that the defendants had not disputed the (international) jurisdiction of the UPC for Ireland. Therefore, the international jurisdiction of the UPC follows from Art. 31 UPCA and Art. 26, 35, 71, 71a and 71b Regulation No. 1215/2012 (Brussels I Regulation). In addition, Art. 24 (No. 4) Brussels I Regulation is not applicable, as the defendants have not raised an objection of nullity.

No settlement of the action through the submission of the cease-and-desist declaration

According to the Local Division The Hague, the plaintiff has an interest in obtaining the provisional measures despite the defendants having issued the cease-and-desist declaration, inter alia because the defendants have breached the cease-and-desist declaration. This corresponds to the German jurisdiction, according to which injunctive relief can be sought (again) if a cease-and-desist declaration is breached.

According to the Local Division The Hague, however, the plaintiff's interest in obtaining the requested provisional measures would continue to exist regardless of the cease-and-desist declaration. In this respect, the Local Division states that provisional measures as a court decision can simply be enforced in the event of a breach, whereas the enforcement of the breach of a cease-and-desist declaration would require new court proceedings. This view contradicts the view taken by the Munich Local Division in its order dated 19 December 2023 (submission of a cease-and-desist declaration and declaration of commitment as a terminating event within the meaning of Rule 360 RoP).

In addition, the enforcement of provisional measures is at least as time-consuming as the enforcement of a contractual penalty, as decisions and orders of the UPC are enforceable in all Contracting Member States in accordance with Art. 82 (1) UPCA, but the enforcement procedure is subject to the law of the Contracting Member State in which the enforcement takes place, see Art. 82 (3) UPCA.

Objection of lack of urgency unsubstantiated and belatedly raised

Only at the hearing did the defendants argue that the necessary urgency was lacking, as the plaintiff had only filed the application for provisional measures more than six months after becoming aware of the subject matter of the infringement and the (potential) infringers. First of all, the Local Division The Hague states in this respect that this claim is inconclusive and, moreover, is not supported by evidence and must therefore be rejected for this reason alone. In addition, the submission was introduced too late in the proceedings and should therefore not be taken into account. If the submission had been admitted and substantiated, the plaintiff's conduct could have been detrimental to urgency, since according to the order of the Hamburg Local Division dated 3 June 2024 , a period of three months from the date of knowledge without the initiation of (judicial) measures is in any case detrimental to urgency.

The order of the Court of Appeal regarding the application for suspensive effect of the appeal

The defendants lodged an appeal against the order of the Local Division The Hague. In principle, the lodging of an appeal has no suspensive effect and therefore does not prevent the enforceability of the first instance decision, see Art. 74 (1) UPCA. However, the Court of Appeal can order the suspensive effect upon reasoned request. This is possible, for example, if the decision against which the appeal was lodged is manifestly erroneous. According to the Court of Appeal, the order of the Local Division The Hague is manifestly erroneous insofar as it also extends to Ireland. This is because, according to the Court of Appeal, Ireland is not a Contracting Member State of the UPCA, as it has signed the UPCA but has not yet ratified it. The requirement of ratification of the UPCA in order to be treated as a Contracting Member State arises from Art. 84 (2) UPCA. Therefore, Ireland was not included in the application, which is why the Local Division awarded more than requested by the plaintiff, which constitutes a violation of Art. 76 UPCA. The Court of Appeal therefore ordered suspensive effect insofar as the order of the Local Division The Hague also extends to Ireland. In all other respects, the Court of Appeal dismissed the application for an order for suspensive effect.

Practical consequences of the order of the Local Division The Hague

In order to avoid any doubts about the (territorial) scope of the claim from the outset, it is advisable to include in the (injunction) application those Contracting Member States in which injunctive relief is sought.

Plaintiffs seeking provisional measures are also advised to initiate (judicial) measures within three months of becoming aware of the subject matter of the infringement and the infringer, as otherwise the urgency required for the issuance of provisional measures is likely to be lacking.

Finally, it should be noted that, in accordance with German practice, a breach of a cease-and-desist declaration triggers the urgency period again and gives rise to a new right of application for provisional measures.