Mala Technologies Ltd v. Nokia Technology GmbH, UPC Court of First Instance, Paris Central Division, 2 May 2024, Case no App_8708/2024, UPC_CFI-484/2023
Paris seat of the UPC’s Central Division (CD) has confirmed that the lis pendens rules in Articles 29-32 of the Recast Brussels Regulation (Brussels Recast) do not apply where a national action commenced before the UPC Agreement (UPCA) came into force and both the UPC action and German national action in the proceedings can proceed.
Background
Mala is the proprietor of EP 2 044 709 B1 (EP’709) which is valid only in Germany. On 29 April 2021, Nokia Solutions and Networks GmbH & Co. KG (Nokia SN) filed a revocation action in respect of the patent before the German Federal Patent Court. This action was dismissed on 18 July 2023, and the full written decision was served on Mala on 13 December 2024, and Nokia SN on 14 December 2023. Nokia Technology GmbH, the defendant in this preliminary objection, filed a revocation action in respect of EP’709 before the Paris Central Division of the UPC on 15 December 2023. On 15 January 2024, Nokia SN filed an appeal against the German Federal Patent Court‘s decision at the Federal Court of Justice. In the UPC action, Mala filed a preliminary objection pursuant to Rules 19.1(a) and 48 of the UPC Rules of Procedure (RoP) denying the competence of the UPC on the basis of the previously filed revocation action before the German Federal Patent Court.
Decision
The Paris CD found that the lis pendens rules under Articles 29-32 of the Recast Brussels Regulation (Brussels Recast) are not directly applicable to the UPC, and do not themselves determine the relationship between proceedings before the UPC and before national courts. If they did, then Articles 71a-d of Brussels Recast, would be superfluous.The Court then went on to consider the scope of Articles 29-31 in connection with Articles 71a-d Brussels Recast. It noted that Article 71c Brussels Recast provided for special rules for cases of lis pendens during the seven year (extendable to 14 years) UPC transitional period, which started on the date the UPC Agreement (UPCA) entered into force (i.e. 1 June 2023) (Article 83(1) UPCA).
Article 71(c)(2) Brussels Recast states: “Articles 29 to 32 shall apply where, during the transitional period referred to in Article 83 of the UPC Agreement, proceedings are brought in the Unified Patent Court and in a court of a Member State party to the UPC Agreement.” The Court said that this takes into account this dual jurisdiction in the case of parallel proceedings.
In the present proceedings, the court said that as the German national proceedings were commenced before the beginning of the transitional period (rather than during it), Articles 29-32 Brussels Recast do not apply.
The Court went on to consider Mala’s alternative argument, that the interests regarding two proceedings which are both initiated during the transitional period, are identical to those concerning two proceedings where one was initiated before the beginning of the transitional period (as in the present case). Mala said that in both scenarios this would lead to a risk of conflicting or contradictory judgments which Article 71c(2) aims to prevent. As such, Mala argued that Article 71c(2) should apply by analogy.
However, this was rejected. The Court found that the scope of Article 71c(2) should be limited to its literal wording. Further, for Article 71c(2) to apply by analogy, an unintended gap and similarity of interests would be required, and there was no such gap in Brussels Recast. The principle of sovereignty means that each country’s courts, as well as the UPC, can independently determine their jurisdiction and adjudicate their cases independently of others. As such, the risk of contradictory judgments is inevitable. This, along with the clear and unambiguous wording of Article 71c(2), indicated that the rule of sovereignty was taken into consideration by the drafters of the UPCA.
The Court also went on to say there is no general principle within the UPCA which prevents the UPC from asserting jurisdiction in revocation proceedings simply because proceedings relating to the same patent are pending before other courts. Indeed, revocation proceedings may be brought before the UPC even if an opposition is pending before the EPO. There is therefore no reason why the same principle should not apply to national courts (unless there is a rule which states otherwise).
Further, a party which filed a national lawsuit before the UPCA entered into force should not be prevented from filing a UPC action, because at the time of filing the national lawsuit it was not clear if and when the UPCA would enter into force. When the claimant initiated the national action, the choice between the UPC and a national court was not available to them. However, in contrast, a claimant which files a lawsuit during the transitional period can make such a choice. Therefore, the court found that the interests of claimants filing revocation lawsuits before and after the entry into force of the UPCA are distinct.
As such, the Paris CD found that Articles 29-33 are not applicable in these proceedings, and dismissed Mala’s preliminary objection.
The Court also dismissed Mala’s application for a stay of proceedings pending the outcome of the German proceedings or the EPO opposition. The conditions for a stay were not met, and neither the EPO nor German Federal Supreme Court are expected to deliver a quick decision.
Conclusion
In summary therefore, the Paris CD found that if a national action was commenced before the transitional period then the provisions of Brussels Recast do not apply and both actions can proceed.
This decision has provided some clarity on the position where a UPC action is commenced and pre-existing national proceedings were commenced before the transitional period. However, further challenges to the scope of the lis pendens rules and the interaction of UPC and national proceedings are expected.
