NanoString Technologies Europe Limited v. President and Fellows of Harvard College (UPC, Court of First Instance, Central Division (Section Munich)), UPC CFI_252/2023;
and
Microsoft Corporation v. Suinno Mobile & AI Technologies Licensing Oy (UPC, Court of First Instance, Central Division (Paris Seat), UPC_CFI_164/2024
Shortly before and after Christmas, the Munich Section and the Paris Seat of the Central Division decided on some interesting aspects regarding the possibility to vary the terms of or even fully revoke an order regarding a security for legal costs and other expenses pursuant to Rule 158 RoP:
NanoString v. Harvard
According to the decision by the Central Division (Section Munich) of December 17, 2024 (NanoString v. Harvard, UPC CFI_252/2023), the Court has the power to release an ordered security for legal costs on the basis of Rule 352.2 RoP upon application of a party in case the reasons for ordering the security have ceased to exist.
The decision gives two examples where such security should be released:
(a) if the party providing the security prevails by final and non-appealable decision (or the possibility of the event for which security was ordered is otherwise removed), and
(b) if there is a material change in the facts and circumstances that led to the security order.
In the case at hand, a first instance decision had been issued in favor of Claimant NanoString, but this decision was still appealable, and Claimant had not shown that their own financial position had changed – the fact that they had been taken over by Bruker Group and that the parent company of this group had 5.9 billion USD in assets was irrelevant. As a consequence, Claimant’s request to release the ordered security was dismissed.
Microsoft v. Suinno Mobile (I)
According to the decision by the Central Division (Paris Seat) of December 27, 2024 (Microsoft v. Suinno Mobile, UPC_CFI_164/2024), a subsequent request for an additional security for procedural costs by the party receiving such security shall be considered as a request to modify the security already granted by increasing its amount.
In the case at hand, the Court had already ordered Suinno Mobile to provide security for costs to Microsoft in an amount of EUR 300k. In the reasoning of the decision, the Court stated that both sides may apply to the Court to revoke the order or vary its terms, if there is a change in the facts underlying the order. While the Court did not require a “material change” in facts, contrary to the aforementioned decision (NanoString v. Harvard, UPC CFI_252/2023), in fact a similar standard was applied dismissing Microsoft’s arguments (increase of costs related to the progression of the written procedure and Suinno Mobile’s admission of lack of financial resources) as not requiring a reassessment of the adequacy of the security already ordered. As a consequence, Microsoft’s request to increase the procedural security was dismissed.
Microsoft v. Suinno Mobile (II)
Finally, according to another decision by the Central Division (Paris Seat) of the same day in the same action (Microsoft v Suinno Mobile, UPC_CFI_164/2024), a subsequent reduction of damages claimed has no influence on the value in litigation and, thus, cannot lead to a lower procedural security.
Where Microsoft had requested an increase of the procedural security (cf. above), Suinno Mobile requested a decrease of the procedural security, because they had reduced the amount of damages claimed in the infringement action and the procedural security was calculated with regard to the maximum recoverable costs based on the value in litigation. While the Court confirmed that both sides may apply to the Court to revoke the order regarding procedural security or vary its terms, it found that the reduction of the damages claim to be irrelevant, because, pursuant to Rule 370 (6) ‘RoP’, the value in litigation shall (only) reflect the objective interest pursued by the claimant at the time of the filing of the action. As a consequence, Suinno Mobile’s request to decrease the procedural security was also dismissed.