Exclusive Jurisdiction in Intellectual Property (Studien zum ausländischen und internationalen Privatrecht Book 273) [1 ed.] 9783161520877, 9783161519543, 3161520874

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Studien zum ausländischen und internationalen Privatrecht 273 Herausgegeben vom

Max-Planck-Institut für ausländisches und internationales Privatrecht Direktoren:

Jürgen Basedow, Holger Fleischer und Reinhard Zimmermann

Benedetta Ubertazzi

Exclusive Jurisdiction in Intellectual Property

Mohr Siebeck

Benedetta Ubertazzi, born 1975; Full-Tenured Researcher of International Law, Faculty of Law, University of Macerata, Italy; Fellow, Alexander von Humboldt Foundation Research Fellowship for Experienced Researchers, Germany, Host Institute: Max Planck Institute for Intellectual Property and Competition Law, Munich, Germany.

e-ISBN 978-3-16-152087-7 ISBN 978-3-16-151954-3 ISSN 0720-1141 (Studien zum ausländischen und internationalen Privatrecht) Die Deutsche Nationalbibliothek verzeichnet diese Publikation in der Deutschen Nationalbibliographie; detaillierte bibliographische Daten sind im Internet über http://dnb. d-nb.de abrufbar. © 2012 Mohr Siebeck Tübingen. Das Werk einschließlich aller seiner Teile ist urheberrechtlich geschützt. Jede Verwertung außerhalb der engen Grenzen des Urheberrechtsgesetzes ist ohne Zustimmung des Verlags unzulässig und strafbar. Das gilt insbesondere für Vervielfältigungen, Übersetzungen, Mikroverfilmungen und die Einspeicherung und Verarbeitung in elektronischen Systemen. Das Buch wurde von Gulde-Druck in Tübingen auf alterungsbeständiges Werkdruckpapier gedruckt und von der Buchbinderei Nädele in Nehren gebunden.

Acknowledgements I wish to thank all those who have made this book possible. First of all, thank you to the Max-Planck-Institut für ausländisches und internationales Privatrecht, and in particular to Professor Jürgen Basedow, for being available to read the book during the busy summer and Christmas season and for accepting it for publication in the book series “Studien zum ausländischen und internationalen Privatrecht”. I would also like to express my gratitude to the European Patent Office, the Max Planck Institute for Intellectual Property and Competition Law of Munich, the Faculty of Law of the University of Augsburg and the Alexander von Humboldt Foundation for the financial support given, the hospitality I enjoyed and the extraordinary privilege of receiving the valuable assistance and feedback of their Professors: Manuel Desantes, Joseph Straus, Joseph Drexl, Annette Kur and Peter Kindler. I am thankful to the University of Macerata for generously allowing me to spend research periods in Germany and for giving me the opportunity to express and test some of my ideas in public lectures and discussion. I am particularly indebted to all Professors of the Institute of International and European Union Law: Gianluca Contaldi, Paolo Palchetti, Beatrice Bonafè, Eugenia Bartoloni, Andrea Caligiuri, Francesca De Vittor and Maura Marchegiani. I would like to express my sincere gratitude to a number of institutions for providing interesting and unique occasions to closely examine various topics addressed in my book: the European Max Planck Group on Conflict of Laws in Intellectual Property (CLIP) for inviting me to participate in several working meetings and conferences (Complutense University of Madrid, March 27– 29, 2008; Max Planck Institute for Intellectual Property and Competition Law, Munich, October 23–24, 2009; Max-Planck-Gesellschaft Harnack-Haus, Berlin, November 4–5, 2011); the American Society of Comparative Law (ASCL), for appointing me as an Italian National Co-reporter to the Questionnaire on Jurisdiction and Applicable Law in Matters of Intellectual Property (2010); the International Law Association (ILA) Committee on Intellectual Property and Private International Law for inviting me to become a member (2011); the Italian Ministry of Foreign Affairs for including me in the Italian delegation for the UNESCO Intergovernmental Committee for the Safeguarding of the Intangible Cultural Heritage (Nairobi, November 15–20, 2010 and

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Bali, November 22–29, 2011); the World Intellectual Property Organisation (WIPO) and the Association for the Protection of Intellectual Property International (AIPPI) for allowing me to participate in the nineteenth session of the Intergovernmental Committee on Intellectual Property and Genetic Resources, Traditional Knowledge and Folklore as the official AIPPI Representative (Geneva, July 18–22, 2011). My sincere gratitude goes to Professors: Fausto Pocar for always being a unique and inspiring mentor, in both my academic and personal life; Toshiyuki Kono, Axel Metzger and Pedro De Miguel Asensio for appointing me to the ILA Committee, discussing ideas with me and providing me with unpublished material; Stefania Bariatti for supporting my candidature as a member of the ILA Committee and for sharing her impressions and knowledge with me, both during and after each CLIP workshop and conference; Costanza Honorati for writing with me for Andrea Guissani’s project on jurisdiction and intellectual property rights, and thereby providing me with constructive feedback for my book; Nerina Boschiero for asking me to work with her for the ASCL as a coreporter and co-author and for the opportunity to present our report at the Washington Congress of July 2010; Giorgio Gaja for his useful suggestions prior to the publication of an article of mine on intangible cultural heritage in the Review “Rivista di diritto internazionale”; Tullio Scovazzi for introducing me to the topic and to the Italian Ministry of Foreign Affairs; Tito Ballarino; Riccardo Luzzatto, Enzo Cannizzaro, Paul Torremans, Rochelle Dreyfuss, Jane Ginsburg, Alexander Peukert, Marketa Trimble, Dai Yokomizo, Gian Paolo Romano, Irene Calboli, Edouard Treppoz and Karen Scott for commenting helpfully on portions or on the entire book. My appreciation is also extended to researchers Paulius Jurcys, Ning Zhao, Claire Wan-Chiung Cheng, Lydia Lundstedt and Jo Slater who were generous with their time by discussing the book with me and sending me Japanese, Chinese, Taiwanese, Swedish and Australian jurisprudence and legislation respectively, kindly translating their relevant parts into English. I am also grateful to Solicitor Trevor Cook, who drew my attention to important UK case-law throughout the years and who always commented on parts of the book in an encouraging way; Justice Ernst Numann and Justice Sierd J Schaafsma, who discussed the book with me at The Hague Supreme Court and kindly provided me with judgments and material, even translating them into English for me. Thank you also to Thierry Calame, Conrad Becker and Elisabeth Kasznar Fekete (AIPPI International); Laura Pitts, Matthew Bedrossian and Irene Heinrich for providing me with constructive feedback and guidance throughout the process of editing this book. On a personal level I have enjoyed the company and encouragement of my parents Luigi Carlo and Patrizia, my husband Federico, my children Carlotta and Nicolò, my brother Tommaso, his wife Laura and their daughter Lucia.

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Without their support I would not have been able to write this book. It is therefore to them all that I dedicate this book. All of what is written in this book is, needless to say, of my own authorship and responsibility. All websites hereafter referred to have been last accessed at November the 30th, 2011. Milan, 30 November 2011

Benedetta Ubertazzi

Table of Contents Acknowledgements ............................................................................................... V Table of Abbreviations .....................................................................................XVI

Chapter I: Introduction ................................................................................... 1 I. Premise ................................................................................................................ 1 1. Exclusive Jurisdiction in Intellectual Property Rights Cases between Public and Private International Law .....................................................................................1 2. What is Included in Exclusive Jurisdiction Rules and what is not. Exclusive Jurisdiction and Subject Matter Jurisdiction ..............................................................10 3. Peculiarities Related to the Analysis of the Lucasfilm and Gallo Cases, and a Brief Mention of Apple’s and Samsung’s still Unsettled Patent War around the Globe ..........................................................................................................................16 4. Uniform European Union Patent and Unified Patent Litigation System: Where do we Stand? ..............................................................................................................19 5. Terminology: Private International Law (PIL); Brussels System; Court of Justice of the European Union (ECJ); Exclusive Jurisdiction; Intellectual Property; Traditional Knowledge (TK), Genetic Resources (GR) and Folklore (F); Intangible Cultural Heritage (ICH); Registered and Unregistered Intellectual Property Rights (IPRs); State Granting an IPR; International Conventions on IP; Four Academic Sets of Principles; International Law Association Committee; the Hague Preliminary Draft; Validity Claims Principally and Incidentally Raised; Infringement Proceedings; Duplicated Proceedings; Misappropriation and Protection; Judgments; Rendering State and Requested Country; Courts...........27 6. Internet and Geolocation Tools ..................................................................................40

II. Theses Purporting that Comity, The Act of State Doctrine and The Territoriality Principle Establish Implicit Exclusive Jurisdiction Rules .........................................................................................................................42 7. The US Court of Appeals for the Federal Circuit Voda Judgment and the UK Court of Appeal Lucasfilm Decision ..........................................................................42 8. The ECJ GAT Decision .............................................................................................45

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III. Exclusive Jurisdiction Rules are not Established either by Comity or by the Act of State Doctrine and the Territoriality Principle, but rather are Contrary to the Public International Law Rules on the Right of Access to Courts ................................................................................................ 48 9. The Subject Matter and the Plan of this Research: Arguments Against Comity and the Act of State Doctrine, as well as Against the Territoriality Principle. The Human Right of Access to a Court .................................................................... 48 10. Arguments Against the Other Rationales in Support of Exclusive Jurisdiction Rules: Foreign Immovable Property, Local Actions, the Moçambique Rule and Article 22(1) of the Brussels System; Double Actionability Rule; the Sound Administration of Justice and the Judicial Economy; the Best Placed Courts; the Difficulties of Applying Foreign Laws; Non-Recognition and NonEnforcement of Judgments on Foreign IPRs; the Amendment of Registers; Forum Non Conveniens ............................................................................................. 49 11. Conclusions. Exclusive Jurisdiction Rules Shall be Abandoned in Benefit not only to IPRs Owners, but also to those with the Potential to Infringe IPRs: Referral........................................................................................................................... 50 12. Delimitation of this Research: Overprotection of IPRs; Contracts; General Jurisdiction; Infringement Jurisdiction; Jurisdiction for Provisional Measures; Prorogation of Jurisdiction; Objective or Subjective Consolidation of Claims; Lis Pendens; Arbitrability and Judicial Settlements; Allocation of Jurisdiction in Purely Domestic Cases .......................................................................................... 50

Chapter II: Comparison. Exclusive Jurisdiction Rules do not Express a Customary International Law Rule. The New Trend to Abandon them ............................................................................................... 55 I. Aims, Delimitation and Terminology of the Comparison.............................. 55 13. First Aim: Exclusive Jurisdiction Rules are not Expressions of Customary International Law Rule ................................................................................................. 55 14. Second Aim: Existing Trend in Favour of the Abandoning of Exclusive Jurisdiction Rules ............................................................................................................. 60 15. Delimitation, Plan and Terminology of the Comparison ........................................... 61

II. The Almost Universal Absence of Exclusive Jurisdiction Rules for Unregistered IPRs both with Respect to Infringement Issues and Validity Claims, whether Principally or Incidentally Raised ........................... 62 16. The Almost Universal Absence of Exclusive Jurisdiction Rules in International Instruments, as well as in EU and EFTA Norms, in National Statutory or Case-law Rules and in the Most Recent Academic Initiatives Principles.................. 62 17. The Very Limited Presence of Exclusive Jurisdiction Rules in South Africa and in India ................................................................................................................ 69

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III. The Almost Universal Absence of Exclusive Jurisdiction Rules for Registered IPRs Pure Infringement Claims, However Raised .....................69 18. The Almost Universal Absence of Exclusive Jurisdiction Rules in International Instruments, as well as in EU and EFTA Norms, in National Statutory or Case-law Rules and in the Most Recent Academic Initiatives Principles .................69 19. The Very Limited Presence of Exclusive Jurisdiction Rules in Certain Common Law Countries and in India ................................................................................76

IV. The Prevailing Absence of Exclusive Jurisdiction Rules for Registered IPRs Validity Issues Incidentally Raised ................................................77 20. The Prevailing Absence of Exclusive Jurisdiction Rules in International Instruments and the Mitigation of the Scope of the Exclusive Jurisdiction Rules of the EU/EFTA Brussels System .............................................................................77 21. The Prevailing Absence of Exclusive Jurisdiction Rules in National Statutory or Case-law Rules and in the Most Recent Academic Initiatives Principles ............87 22. The Presence of Exclusive Jurisdiction Rules in the Brussels System, albeit with Mitigated Scope. The Limited Presence of Exclusive Jurisdiction Rules in Certain Common Law Countries and in India .......................................................89

V. The Emerging Rejection of Exclusive Jurisdiction Rules for Registered IPRs Validity Issues Principally Raised .................................................90 23. The Emerging Rejection of Exclusive Jurisdiction Rules .........................................90 24. The Exclusive Jurisdiction Rules in EU/EFTA Norms as well as in the National Statutory or Case-law Rules ...................................................................................96

VI. Conclusions .............................................................................................................97 25. The Exclusive Jurisdiction Rules Related to Unregistered IPRs Pure Infringement Claims and Validity Claims however Raised, as well as Registered IPRs Pure Infringement Claims and Validity Claims Incidentally Raised, are not an Expression of a Customary International Law Rule .................................................97 26. The Exclusive Jurisdiction Rules related to Registered IPRs Validity Issues Principally Raised are not an Expression of Customary Law ....................................98

Chapter III: The Act of State Doctrine and Comity do not Mandate Exclusive Jurisdiction Rules ........................................................100 I. Introduction ..........................................................................................................100 27. Reasons for Addressing the Act of State Doctrine and Comity in this Same Chapter ....................................................................................................................100 28. Reasons for Primarily addressing Common Law Jurisprudence .............................101 29. The Act of State and Comity Doctrines as “Suggested” by Public International Law ......................................................................................................................... 102

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II. Theses According to which the Act of State Doctrine Implicitly Poses Exclusive Jurisdiction Rules.............................................................................. 102 30. Theses According to which the Act of State Doctrine Establishes Implicit Exclusive Jurisdiction Rules: the Voda and the ECJ GAT Decisions .......................... 102 31. Other Relevant Judgments ...................................................................................... 104 32. The Inapplicability of the Act of State to Unregistered IPRs .................................. 107

III. The Act of State Doctrine Does not Pose Exclusive Jurisdiction Rules ...................................................................................................................... 108 33. The Act of State Doctrine Does not Prevent Courts from Adjudicating Foreign Acts of States .......................................................................................................... 108 34. IPRs are not an Expression of the Sovereignty of Foreign Governments ................ 114 35. Relevant Judgments ................................................................................................ 117

IV. Theses According to which Comity Implicitly Poses Exclusive Jurisdiction Rules ......................................................................................................... 120 36. Theses According to which Comity Establishes Implicit Exclusive Jurisdiction Rules: the Voda and the UK Court of Appeal’s Lucasfilm Judgments .................... 120 37. Other Relevant Judgments ...................................................................................... 123 38. The Applicability of Comity to Unregistered IPRs.................................................. 126

V. Comity does not pose Exclusive Jurisdiction Rules .................................... 128 39. Assuming Jurisdiction over Foreign IPRs Claims is Imposed by Public International Law, Referral ............................................................................................ 128 40. Assuming Jurisdiction over Foreign IPRs Claims does not Prejudice the Rights of Foreign Governments .......................................................................................... 129 41. Assuming Jurisdiction over Foreign IPRs Claims Corresponds to the Citizens’ Interests .................................................................................................................... 131

VI. The Act of State Doctrine and Comity are Contrary to Public International Law ........................................................................................................ 132 42. The Act of State and Comity are not Suggested by Public International Law......... 132 43. The Act of State and Comity are even Contrary to the Public International Law Rules on the Avoidance of a Denial of Justice and on the Right of Access to a Court ................................................................................................................ 135

Chapter IV: The Territoriality Principle does not Mandate Exclusive Jurisdiction Rules ............................................................................ 137 I. Territoriality and Universality ......................................................................... 137 44. Territoriality and Universality in Public International Law .................................... 137 45. Territoriality and Universality in Relation to IPRs ................................................. 138

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II. Territorial and Universal IPRs Protection Outside the IP Systems ..........148 46. The Territoriality Principle as an Obstacle to the Universal Protection of IPRs. Thesis Proposing to Achieve that Universal Protection throughout International Legal Systems other than that which is Established for IP. The Relevance of these Theses for Present Purposes............................................................................148 47. Crimes of Piracy, Cyberattacks and Biopiracy ........................................................150 48. Human Rights to Intellectual Property ....................................................................153 49. UNIDROIT Convention on Stolen or Illegally Exported Cultural Objects ............158

III. Territorial and Universal IPRs Protection Inside the IP Systems ............160 50. Theses According to which the Territoriality Principle Establishes Implicit Exclusive Jurisdiction Rules: the Voda, the UK Court of Appeal’s Lucasfilm and the Gallo Judgments, Referral ...........................................................................160 51. The Territoriality Principle in the CUP, CUB, and TRIPs Agreement does not Pose Exclusive Jurisdiction Rules ...........................................................................161 52. Non-acceptability of the Opinion that the Territoriality Principle in the CUP, CUB, and TRIPs Agreement Poses Exclusive Jurisdiction Rules ...........................161 53. Non-acceptability of the Opinion that the Territoriality Principle in the CUP, CUB, and TRIPs Agreement Impedes the Courts Seised from Adopting PIL Rules ........................................................................................................................ 170 54. Non-acceptability of the Opinion that the Territoriality Principle in the CUP, CUB, and TRIPs Agreement has only a Substantive Nature ...................................172 55. Non-acceptability of the Opinion that the Territoriality Principle in the CUP, CUB, and TRIPs Agreement has a PIL Nature and Always Prescribes the Application of the Lex Loci Protectionis ......................................................................173 56. The Territoriality Principle in other Relevant Norms Expressly Shaped as PIL Rules ....................................................................................................................... 176 57. Non-acceptability of the Opinion that the Territoriality Principle in Rules other than the CUP, CUB, and TRIPs Agreement does not Impose the Application of a Foreign Law ......................................................................................................178 58. Non-acceptability of the Opinion that the Territoriality Principle in Rules other than the CUP, CUB, and TRIPs Agreement has only a Substantive Nature ...........179

IV. Thesis Here Purported: the Territoriality Principle as an Expression of the Proximity Principle ..................................................................................180 59. Opinions Already Emphasizing the Connection between the Territoriality Principle and Proximity Reasons in IPRs Cases ......................................................180 60. Lagarde’s Thesis on the Proximity Principle ...........................................................182 61. Extension to IPRs of Lagarde’s Thesis on the Proximity Principle ........................186 62. First Group of PIL Provisions Deviating from the Territoriality Principle: Rules that Adopt Jurisdiction Criteria which are not Based on the Territoriality Principle ...................................................................................................................188 63. Second Group of PIL Provisions Deviating from the Territoriality Principle: Rules that Adopt Connecting Factors which are not Based on the Territoriality Principle ...................................................................................................................199

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64. Third Group of PIL Provisions Deviating from the Territoriality Principle: Rules Allowing Recognition and Enforcement of Foreign Judgments Rendered by Courts of States other than the IPRs Granting Countries .......................... 204

V. Conclusions ............................................................................................. 204 65. Overcoming the Exclusive Jurisdiction, the Exclusive Designation of the Lex Loci Protectionis and the Impossibility of Recognising and Enforcing Foreign Judgments Rendered by Courts other than the Ones having Exclusive Jurisdiction or According to a Law other than the Lex Loci Protectionis ............................ 204

Chapter V: Other Arguments are Insufficient to Mandate Exclusive Jurisdiction Rules ............................................................................ 206 66. Introduction.............................................................................................................. 206 67. Foreign Immovable Property, Local Actions, the Moçambique rule and Article 22(1) of the Brussels System ................................................................................... 207 68. Double Actionability Rule ...................................................................................... 212 69. Sound Administration of Justice and the Judicial Economy ................................... 215 70. Best Placed Courts ................................................................................................... 215 71. Difficulties and Costs of Applying Foreign Laws ................................................... 216 72. Recognition and Enforcement of Judgments on Foreign IPRs: Voluntary Compliance and Vicious Circle ............................................................................... 218 73. Recognition and Enforcement of Judgments on Foreign IPRs: Public Policy Exception and International Mandatory Rules of the Country that Granted the Right ....................................................................................................................... 221 74. Recognition and Enforcement of Judgments on Foreign IPRs: already Existing Rules and Tendency in Favor of Recognition and Enforcement, Issue Preclusion and Res Judicata ............................................................................................. 231 75. Amendment of Registers.......................................................................................... 235 76. Forum Non Conveniens and Special Circumstances Test........................................ 238

Chapter VI: Exclusive Jurisdiction Rules Imply a Denial of Justice and Violate the Fundamental Human Right of Access to Courts .................................................................................................................... 245 I. Introduction........................................................................................................... 245 77. Premise .................................................................................................................... 245 78. Denial of Justice....................................................................................................... 245 79. Forum Necessitatis .................................................................................................. 247 80. Hierarchy of the Sources of Law ............................................................................. 256 81. Forum Necessitatis in the EU Brussels System ....................................................... 258 82. Exclusive Jurisdiction in the EU Brussels System ................................................... 263

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II. The Fundamental Human Right of Access to Courts ...................................264 83. 84. 85. 86. 87. 88. 89.

Origin and Nature.....................................................................................................264 Characterisation .......................................................................................................267 Civil Proceedings .....................................................................................................268 Restrictions of the Right of Access to Courts ..........................................................269 Restrictions Imposed by International Jurisdiction Rules ........................................271 Alternative Means of Recourse in the Forum State rather than in Third States .......276 Exclusive Jurisdiction Rules and the Right of Access to the Court ........................280

III. Exclusive Jurisdiction Rules are Contrary to the Public International Law Rules on the Denial of Justice and on the Fundamental Human Right of Access to Courts ..........................................................................281 90. Exclusive Jurisdiction Rules and Denial of Justice ..................................................281 91. Exclusive Jurisdiction Rules and the Fundamental Human Right of Access to Courts .......................................................................................................................286 92. Solutions of a PIL and Human Rights Nature ..........................................................287 93. Analogy of the Conclusions Regarding the Relation between the Exclusive Jurisdiction Rules and the Fundamental Human Right of Access to Courts to the Conclusions Regarding the Relation between the same Exclusive Jurisdiction Rules and the Denial of Justice/Forum Necessitatis Rules .....................................290

IV. Declining of Jurisdiction and International Responsibility .......................290 94. Remedies for Denial of Justice ................................................................................290 95. Remedies for Violation of the Fundamental Human Right of Access to Courts .....292

Chapter VII: General Conclusions................................................................295 96. Conclusions ............................................................................................................. 295 97. EU IPRs and European Unified Patent Judiciary ....................................................298 98. Preventing Economic Inequalities in Litigation in Favour not only of the IPRs Owners but of those with the Potential to Infringe IPRs as well ............................299 99. Forum Shopping .......................................................................................................300

Bibliography ................................................................................................................303 Tables of Cases............................................................................................................330 Table of Treaties, Conventions and Other Instruments ......................................336 Index ..............................................................................................................................339

Table of Abbreviations AIDA ACTA AEDIPr Am. J. Comp. L. AJIL ALI ARIPO B.C. Int'l & Comp. L. Rev. Brook. J. Int'l L. Brit. Y.B. Int’l L. CLJ Cardozo J. Int'l & Comp. L. Colum. J. Transnat'l L. Colum. L. Rev. CLIP Corn. L. Rev. COM CPL Denv. J. Int’l L. & Pol’y EJCL ECHR ECtHR ECJ EFTA EIPR Env. Pol'y & L. EPC EPL EPO Ford. Intell. Prop. Media & Ent. L.J. GADI GRUR Int Harv. Int’l L.J. Hous. L. Rev. Ind. Int’l & Comp. L. Rev. ICH ICJ

Annali italiani del diritto d’autore, della cultura e dello spettacolo Anti-Counterfeiting Trade Agreement Anuario español de derecho internacional privado American Journal of Comparative Law American Journal of International Law American Law Institute African Regional Intellectual Property Organization Boston College International & Comparative Law Review Brooklyn Journal of International Law British Yearbook of International Law Cambridge Law Journal Cardozo Journal of International and Comparative Law Columbia Journal of Transnational Law Columbia Law Review Conflict of Laws in Intellectual Property Cornell Law Review European Community Reports Civil Procedure Law of the People’s Republic of China Denver Journal of International Law and Policy Electronic Journal of Comparative Law European Convention on Human Rights European Court of Human Rights European Court of Justice (Court of Justice of the European Union) European Free Trade Association European Intellectual Property Review Environmental Policy and Law European Patent Convention European Patent Law European Patent Office Fordham Intellectual Property, Media & Entertainment Law Journal Giurisprudenza annotata di diritto industriale Gewerblicher Rechtsschutz und Urheberrecht: Internationaler Teil Harvard International Law Journal Houston Law Review India International & Comparative Law Review Intangible Cultural Heritage International Court of Justice

Table of Abbreviations IIC IJCS Int'l & Comp. L.Q. Int. J. Law & Inf. Tec. IPRax IPQ Italian. Intell. Prop. Italian Y.B. Int’l L. JYIL JDI J. Bus. L. JED J. Int’l Arb. JIPLP J. Priv. Int’l L. J. Pub. Int’l L. J. Tech. L. & Pol’y J. Pat. & Trademark Off. Soc’y J. Tech. L. & Pol'y LMCLQ Marq. I. P. L. Rev. Mich. J. Int’l L. Mich. L. Rev. N.Y.U. J. Int’l L. & Pol. NZULR NZYIL OAPI OHIM OJ OUP PCIJ Pol. Dir. PIL RabelsZ Recueil des Cours REDI RCDIP RIDC Riv. Dir. Ind. RDI RDIPP Rich. J. Global L. & Bus. CHTLJ SZIER

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International Review of Intellectual Property and Competition Law International Journal of Cultural Studies International and Comparative Law Quarterly International Journal of Law and Information Technology Praxis des Internationalen Privat- und Verfahrensrechts Intellectual Property Quarterly Italian Intellectual Propety Italian Yearbook of International Law Japanese Yearbook of International Law Journal du droit international Journal of Business Law Journal of Environment and Development Journal of International Arbitration Journal of Intellectual Property Law & Practice Journal of Private International Law Journal of Public International Law Journal of Technology Law and Policy Journal of the Patent and Trademark Office Society Journal of Technology Law and Policy Lloyd’s Maritime & Commercial Law Quarterly Marquette Intellectual Property Law Review Michigan Journal of International Law Michigan Law Review New York University Journal of International Law and Politics New Zealand University Law Review New Zealand Yearbook of International Law Organisation Africaine de la Propriété Intellectuelle Office for the Harmonization in the Internal Market (Trade Marks and Designs) Official Journal of European Union Oxford University Press Permanent Court of International Justice Politica del diritto Private International Law Rabels Zeitschrift für ausländisches und internationales Privatrecht Recueil des Cours de l’Académie de droit international de La Haye Revista española de derecho internacional Revue critique de droit international privé Revue de droit international et de droit comparé Rivista di diritto industriale Rivista di diritto internazionale Rivista di diritto internazionale privato e processuale Richmond Journal of Global Law & Business Santa Clara Computer and High Technology Law Journal Schweizerische Zeitschrift für internationales und europäisches Recht

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So. Cal. L. Rev. Transparency Proposal

Southern California Law Review Transparency of Japanese Law Project, Transparency Proposal on Jurisdiction, Choice of Law, Recognition and Enforcement of Foreign Judgments in Intellectual Property Agreement on Trade-Related Aspects of Intellectual Property Temple Law Review Tulane Law Review Unified Patent Litigation System United Nationals Convention on the Law of the Sea United Nations Conference on Trade and Development Institut international pour l'unification du droit prive United Nations Educational, Scientific and Cultural Organization United Nations Reports of International Arbitral Awards University of California Davis Law Review University of Pennsylvania Journal of International Economic Law University of Pennsylvania Law Review Virginia Journal of International Law Vanderbilt Journal of Transnational Law Principles of Private International Law on Intellectual Property Rights (Waseda University Global COE Project) Washington Law Review West Virginia Law Review World Intellectual Property Organisation William and Mary Law Review World Trade Organisation WIPO Performances and Phonograms Treaty Yale Journal of International Law Yearbook of Private International Law

TRIPs Agreement TLR Tul. L. Rev. ULPS UNCLOS UNCTAD UNIDROIT UNESCO UNRIAA U.C. Davis L. Rev. U. Pa. J. Int’l Econ. L. U. Pa. L. Rev. Va. J. Int’l L. Vand. J. Transnat'l L. Waseda Proposal Washington L. Rev. W. Va. L. Rev. WIPO Wm. & Mary L. Rev. WTO WPPT YJIL Y.B. Priv. Int’l L.

Chapter I

Introduction I. Premise I. Premise 1. Exclusive Jurisdiction in IPRs Cases between Public and Private International Law Whereas substantive intellectual property (IP) law is far advanced in terms of international harmonisation1, despite recent efforts inter alia of the World Intellectual Property Organization (WIPO)2 issues of jurisdiction, applicable 1

See infra, paras 5 and 34. See Marketa Trimble Landova, ‘When Foreigners Infringe Patents: an Empirical Look at the Involvement of Foreign Defendants in Patent Litigation in the U.S.’ (2011) 27 CHTLJ 499, 500; Fiona Rotstein, ‘Is there an International Intellectual Property System? Is there an Agreement Between States as to What the Objectives of Intellectual Property Laws Should Be?’ (2011) 33 EIPR 1-4 accessed 30 November 2011. 2 Inter alia, from 30-31 January 2001 in Geneva WIPO organised a WIPO Forum on Private International Law and Intellectual Property. See the related papers and documents at the WIPO website , namely André Lucas, ‘Private International Law Aspects of the Protection of Works and of the Subject Matter of Related Rights Transmitted Over Digital Networks’ WIPO/PIL/01/1 Prov; Jane Ginsburg, ‘Private International Law Aspects of the Protection of Works and Objects of Related Rights Transmitted Through Digital Networks (2000 Update)’ WIPO/PIL/01; Fritz Blumer, ‘Patent Law And International Private Law On Both Sides Of The Atlantic’ WIPO/PIL/01/3; Graeme Dinwoodie, ‘Private International Aspects of the Protection of Trademarks’ WIPO/PIL/01; Graeme Austin, ‘Private International Law And Intellectual Property Rights - A Common Law Overview’ WIPO/PIL/01/5; Henry Perritt, ‘Electronic Commerce: Issues in Private International Law and the Role of Alternative Dispute Resolution’ WIPO/PIL/01/6; Rochelle Dreyfuss and Jane Ginsburg, ‘Draft Convention on Jurisdiction and Recognition of Judgments in Intellectual Property Matters’ WIPO/PIL/01/7; Masato Dogauchi, ‘Private International Law On Intellectual Property: A Civil Law Overview’ WIPO/PIL/01/8; International Bureau, Background Paper,WIPO/PIL/01/9. See also the Paris Union and WIPO Joint Recommendation Concerning the Protection of Marks, and Other Industrial Property Rights in Signs, on the Internet, adopted by the Assembly of the Paris Union for the Protection of Industrial Property and the General Assembly of the WIPO at the Thirty-Sixth Series of Meetings of the Assemblies of the Member States of WIPO 24 September to 3 October 2001. The preface of this recommendation states that “the determination of the applicable law itself is not addressed by the present provisions, but left to the private international laws of individual Member States”. On this Joint Recommendation see Axel Metzger, ‘Applicable Law Under The CLIP-Principles: A Pragmatic Revaluation Of Territoriality’ in Jürgen Basedow, Toshiyuki Kono and Axel Metzger (eds), Intellectual Property

2

Chapter I: Introduction

law and recognition and enforcement of judgments still remain untouched by universal international harmonisation measures3. In fact, besides the substantive harmonisation of IP laws4, States constituted international governmental organisations that centralize all or part of the administrative procedures that are necessary for the granting of certain intellectual property rights (IPRs)5. Particularly, these organisations established a centralized deposit, reducing the costs of making individual applications or filings in all of the countries in which protection is sought, and therefore “making it easier the acquisition of equivalent IPRs on the same subject matter in a number of jurisdictions approximately at the same time”6. Yet, the rights granted according to those procedural conventions typically give rise to a portfolio of national or EU7 rights enforceable only as territorial rights, without containing significant rules addressing either the international jurisdiction of the courts of the member States to adjudicate IP related claims, or the recognition and enforcement of foreign judgments in the area of IPRs. Additionally, notwithstanding that the existing and negotiated universal international instruments on IP, especially the ones concluded and negotiated in the past two decades, including the Agreement on Trade Related Aspects of Intellectual Property Rights of April 1994 (hereinafter: TRIPS Agreement)8 and the Anti-Counterfeiting Trade in the Global Arena (Tübingen, Mohr Siebeck 2010) 172-173. See also, infra, para 63, for the application of the Joint Recommendation by the German Federal Court of Justice in Hotel Maritime (Case IZ R 163/02, 13 October 2004). 3 Note, these issues are usually addressed by regional international rules. For instance, in Europe, the Convention on the Grant of European Patents (adopted 5 October 1973, entered into force 7 October 1977) 1065 UNTS 199 (European Patent Convention), on which see infra para 4, includes the Protocol on Jurisdiction and the Recognition of Decisions in respect of the Right to the Grant of a European Patent (Protocol on Recognition). The text is available at accessed 30 November 2011. Council Regulation (EC) 40/94 of 20 December 1993 on the Community trade mark [1994] OJ L011 (see amending acts at accessed 30 November 2011) includes Title X on Jurisdiction and Procedure in Legal Actions Relating to Community Trade Marks. Council Regulation (EC) 6/2002 of 12 December 2001 on Community designs [2002] OJ L3/1 includes Title IX on Jurisdiction and Procedure in Legal Actions Relating to Community Designs. Council Regulation (EC) 2100/94 of 27 July 1994 on Community plant variety rights [1994] OJ L227/1 includes Part Six on Civil Law Claims, Infringements, Jurisdiction. 4 See infra, paras 5 and 34. 5 Ibid. 6 Pedro de Miguel Asensio, ‘Cross-border Adjudication of Intellectual Property Rights and Competition between Jurisdictions’ (2007) 41 AIDA 117. 7 See infra, para 4. 8 Agreement on Trade Related Aspects of Intellectual Property Rights (TRIPs), Annex 1C of the Marrakesh Agreement Establishing the World Trade Organization, (signed in Marrakesh, Morocco, 15 April 1994) available at accessed 30 November 2011. For the text of the treaty see accessed 30 November 2011. The TRIPs agreement incorporates various IP conventional norms by reference, including the principles of territoriality and national treatment. However, the TRIPs agreement also “departs from the long tradition whereby international IP conventions confined themselves to imposing on Members only negative obligations, in particular by requiring national treatment of foreigners, and takes the unprecedented step of mandating positive obligations, including most-favoured nation treatment and greatly expanding minimum IP protection standards”. See Marco Ricolfi, ‘The First Ten Years of the TRIPs Agreement: Is There an Antitrust Antidote Against IP Overprotection Within TRIPs?’ (2006) 10 Marq I. P. L. Rev. 305. See also Marco Ricolfi, ‘The Interface between Intellectual Property and International Trade: the TRIPs Agreement’ (2002) 29 Italian Intell. Prop. 29; Christopher Wadlow, ‘“Including Trade in Counterfeit Goods”: The Origins of TRIPs as a GATT Anti-counterfeiting Code’ (2007) 3 IPQ 350. 9 See the preamble of this agreement, the paragraphs of which are not numbered and which states that “Noting that effective enforcement of intellectual property rights is critical to sustaining economic growth across all industries and globally [...] Intending to provide effective and appropriate means, complementing the TRIPS Agreement, for the enforcement of intellectual property rights, taking into account differences in their respective legal systems and practices; Desiring to address the problem of infringement of intellectual property rights, including infringement taking place in the digital environment”. The negotiating parties of ACTA are a mix of developed and emerging economies: Australia, Canada, the European Union, Japan, Korea, Mexico, Morocco, New Zealand, Singapore, Switzerland and the United States. See accessed 30 November 2011. See also Eddan Katz and Gwen Hinz, ‘The Impact of the Anti-Counterfeiting Trade Agreement on the Knowledge Economy: The Accountability of the Office of the U.S. Trade Representative for the Creation of IP Enforcement Norms Through Executive Trade Agreements’ (2009) 35 YJIL 24 accessed 30 November 2011. 10 Trimble Landova, ‘When Foreigners Infringe Patents’ (n 1 Chapter I) 500 and de Miguel Asensio, ‘Cross-border’ (n 6 Chapter I) 107. 11 Trimble Landova, ‘When Foreigners Infringe Patents’ (n 1 Chapter I) 500. 12 Ibid 514. 13 The Hague Preliminary Draft Convention on Jurisdiction and the Effects of Judgments in Civil and Commercial Matters (adopted on 30 October 1999), with an explanatory report by Peter Nygh and Fausto Pocar, ‘Preliminary Document No. 11’ in Fausto Pocar and Costanza Honorati (eds), The Hague Preliminary Draft Convention on Jurisdiction and Judgments: Proceedings of the Round Table held at Milan University on 15 November 2003 (Mi-

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Chapter I: Introduction

200114 which included also rules on cross-border IPRs issues, this text and its IPRs rules were very contentious15. Reasoning for this current frame can be inferred in at least two ways. First, since the failure of the proposed Hague Convention on Jurisdiction and Enforcement in Civil and Commercial Matters was mainly due to the lack of consensus on cross-border IPRs rules, this failure might have discouraged States from attempting to negotiate any cross-border litigation instrument. Second, “as with other issues that do not receive adequate attention in the international trade arena, there might be a lack of pressure by interests groups to place the problems on the agenda”16, which might also be grounded on the fact that the current system obliges enforcement of IPRs on a national basis, country by country according to the so-called mosaic approach. This causes economic inequalities, where the big multinational companies are generally able to finance litigation in every relevant jurisdiction, or at least in the ones that would be likely to produce spill-over effects, whereas the medium-small size enterprises may well lack the same financial strength to defend each national proceeding17. Indeed, empirical studies have shown in recent years that cross-border cases are growing in number and increasing in proportion to the total number of IPRs cases that have been filed18. Additionally, this increase is seen in cases affecting IPRs that are particularly relevant to the national economy of countries involved19. Therefore, given the frequent exploitation of IPRs beyond national borders and the need for their cross-border enforcement, an internation-

lan, Wolters Kluwer 2005) 209. The text of the DHJC, its history and the ensuing developments, are also available from Pocar and Honorati. See also Andrea Schulz, ‘The Hague Conference Project for a Global Convention on Jurisdiction, Recognition and Enforcement in Civil and Commercial Matters: An Update’ in Josef Drexl and Annette Kur (eds), Intellectual Property and Private International Law. Heading for the Future. (Oxford, Hart Publishing 2005) 5. With respect to IPRs see Dreyfuss and Ginsburg (n 2 Chapter I); Annette Kur, ‘International Hague Convention on Jurisdiction and Foreign Judgments: A Way Forward for IP?’ (2002) 24 EIPR 175; Petkova Svetozara, ‘The Potential Impact of the Draft Hague Convention on International Jurisdiction and Foreign Judgments in Civil and Commercial Matters on Internet-related Disputes with Particular Reference to Copyright’ (2004) 2 IPQ 173. 14 See Permanent Bureau, ‘Report of the experts meeting in the intellectual property aspects of the future Convention on jurisdiction and foreign judgments in civil and commercial matters’ Preliminary Document No. 13 (1 February 2001), page 7, available at accessed 30 November 2011. 15 Schulz (n 13 Chapter I) 7-8 and Kur (n 13 Chapter I) 175. 16 Trimble Landova, ‘When Foreigners Infringe Patents’ (n 1 Chapter I) 514. 17 See infra, para 98. 18 Trimble Landova, ‘When Foreigners Infringe Patents’ (n 1 Chapter I) 548. 19 Ibid.

I. Premise

5

al agreement should remain the ultimate goal to be achieved20. Thus, both previous and current negotiations are occurring at different international fora of an academic nature, aimed at proposing four different sets of principles related to the international jurisdiction rules concerning the IPRs cross-border litigation issues21. Finally, most recently the International Law Association started to work on the four sets of principles, namely comparing and summarizing their major outcomes with respect to international jurisdiction, applicable law and recognition and enforcement of judgments (hereinafter: PIL) rules concerning the IPRs cross-border enforcement22. In the absence of universal international binding rules on the cross-border enforcement of IPRs, prestigious Courts around the world have recently refused to adjudicate cases relating to foreign registered or unregistered IPRs, where the proceedings concerned an IPR infringement claim or where the defendant in an IPR infringement action or the claimant in a declaratory action to establish that the IPR is not infringed pleaded that the IPR is invalid and that there is also no infringement of that right for the aforementioned reason (so-called validity issues incidentally raised)23. In these cases the refusal to adjudicate the foreign IPRs infringement and validity claims was grounded on exclusive subject matter jurisdiction (hereinafter: exclusive jurisdictio24) rules25. According to those rules, the State that granted26 the IPR has the exclusive jurisdiction to address claims related thereto, regardless of whether it also has personal jurisdiction over the defendant. Among those decisions27 are 20 See François Dessemontet, ‘The ALI Principles: Intellectual Property in Transborder Litigation’ in Basedow, Kono and Metzger (n 2 Chapter I) 33 recalling a Basle PhD Thesis proposing this goal at the beginning of the XVIIIth century already. See also Troller Aloïs, Das internationale Privat- und Zivilprozessrecht im gewerblichen Rechtsschutz und Urheberrecht (Basel, Verlag für Recht und Gesellschaft 1952); Eugen Ulmer, Intellectual Property Rights and the Conflict of Laws (Springer 1976) 34, research and proposal presented in 1975 at the Nymphenburg Colloquium at the request of the Commission of the European Union. 21 See para 5. 22 See para 5. 23 See para 5 for this terminology. 24 See also infra, para 2. 25 Of a statutory or a case law nature, see infra. 26 On the notion of State that granted an IPR see infra para 5. 27 See also the judgments referred to in Toshiyuki Kono and Paulius Jurys, ‘XVIIIth International Congress on Comparative Law, Intellectual Property and Private International Law’ (provisional draft of the general report) (July 2010) in Toshiyuki Kono (ed), Intellectual Property and Private International Law § II(4) (forthcoming, Hart Publishing); and the decisions quoted by the following national reports on Jurisdiction and Applicable Law in Matters of Intellectual Property (forthcoming) ibid.; Marie-Christine Janssens, ‘The Relationship between Intellectual Property Law and International Private Law viewed from a Belgian Perspective’, § I(II)(2)(1)(3); Joost Blom, ‘Report for Canada (including Quebec)’, subsection II(A); Ivana Kunda, ‘Report for Croatia’, subsection I(B); Marie-Elodie Ancel, ‘Report for France’, subsection I(ii); Axel Metzger, ‘Report for Germany’, subsection I(2)(a)(1); Van-

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Chapter I: Introduction

the Supreme Court of Appeal of the South Africa’s Gallo Africa Ltd. v Sting Music (Pty) Ltd.28 decision of 3 September 2010; the United Kingdom Court of Appeal’s 16 December 2009 decision in Lucasfilm Entertainment Co. v Ainsworth29 (which was reversed by the Supreme Court’s 27 July 2011 ruling30); the US Court of Appeals for the Federal Circuit’s 2 January 2007 decision in Voda v Cordis Corp.31; and the Court of Justice of the European Union GAT decision of 13 July 200632. dana Singh, ‘Report for India’, subsection I(2); Nerina Boschiero and Benedetta Ubertazzi, ‘Report for Italy’, subsection II. Case 2, available at (2010) 16 Cardozo Electronic Law Bulletin 291 ( accessed 30 November 2011); Dai Yokomizo, ‘Report for Japan’, subsection 1(1)(2); Alexandre Dias Pereira, ‘Report for Portugal’, subsection I(B)(2)(2); Damjan Možina, Report for Slovenia, subsection I(II)(1); Pedro de Miguel Asensio, ‘Report for Spain’, subsection 1(2)(1)-(3); Amélie Charbon, ‘Report for Switzerland’, subsection I(1); Dick van Engelen, ‘Report for The Netherlands’, subsection 3(6). 28 [2010] (6) SA 329 (SCA) (S. Afr.). The case is available at accessed 30 November 2011. 29 [2009] EWCA (Civ) 1328 (Eng.). The case is available at accessed 30 November 2011. Jacob LJ delivered the Court’s judgment. On this judgment, see Paul Torremans, ‘Lucasfilm v Ainsworth’ (2010) 7 IIC 751; Andrew Dickinson, ‘The Force be with the EU? Infringements of US Copyright in the English Courts’ (2010) 2 LMCLQ 181. On the Court of First Instance decision of this same case, see Graeme Austin, ‘The Concept of “Justiciability” in Foreign Copyright Infringement Cases’ (2009) 40 IIC 393. See also the recent English judgment by the Royal Courts of Justice, Strand, London, Crosstown Music Company 1, LLC v Rive Droite Music Ltd. & Ors, [2009] EWHC Civ 1222, partly available at accessed 30 November 2011 (in which an attempt by one party to argue for a wider application of the UK Court of Appeal’s Lucasfilm judgment failed). 30 Lucasfilm Ltd. & Ors v Ainsworth & Anor [2011] UKSC 39 (27 July 2011)

accessed 30 November 2011. 31 476 F.3d 887 (Fed. Cir. 2007). See Jane Ginsburg, ‘Jurisdiction and Recognition of Judgments under the ALI Principles’ in Stefania Bariatti (ed), Litigating Intellectual Property Rights Disputes Cross-Border: EU Regulations, ALI Principles, CLIP Project (Padova, CEDAM 2010). 32 Case C-4/03 Gesellschaft für Antriebstechnik mbH & Co. KA (GAT) v Lamellen und Kupplungsbau Beteilgungs KG (LuK) [2006] ECR I-6509. Note that the Court of Justice of the European Union is the former European Court of Justice, for simplicity reasons this court will hereafter be referred to as ECJ. See para 5. With this judgment the ECJ pronounced not on its jurisdiction, but rather on the jurisdiction of the courts of the EU member States. For critics of this decision, see Annette Kur, ‘A Farewell to Cross-Border Injunctions? The ECJ Decisions GAT v. LuK and Roche Nederland v. Primus and Goldenberg’ (2006) 7 IIC 844; Cristina González Beilfuss, ‘Nulidad e infracción de patentes en Europa después de GAT y ROCHE’ [2006] AEDIPr 275; The European Max Planck Group for Conflict of Laws in Intellectual Property, ‘Exclusive Jurisdiction and Cross Border IP (Patent) Infringement. Suggestions for Amendment of the Brussels I Regulation’ (CLIP Report of 20 December 2006)

I. Premise

7

These decisions are grounded on the assumption that since IPRs relate to a State’s sovereignty or domestic policies, the granting of the IPR is a State act and the effects of the granting of this act of State are limited to the territory of the State that granted the IPR in issue. Therefore, if a State other than that which granted the IPR exercised jurisdiction, this State would risk creating an unreasonable interference with the State which initially granted the IPR in question. To avoid this unreasonable interference, the petitioned Courts dedecline jurisdiction in foreign IPRs cases. This declination of jurisdiction is not the result of any general public international law obligation, but rather is a discretionary act of self-restraint based on domestic rules of international proprocedural law grounded on reasons of comity to the courts and on the act of State doctrine33. (Hereafter, the terms “comity to the courts” and the “act of State doctrine” will be interchangeable throughout this introductory chapter)34. Indeed, notwithstanding the fact that these comity rules are of a domestic nature, the same rules are rooted in the concept of territorial sovereignty within a system of equal nation-States. Thus, “even more important than the conflicts of law rules themselves are the basic contours of comity […] name-

available at ; Lydia Lundstedt, ‘In the Wake of GAT/LuK and Roche/Primus’ (2008) 2 Nordiskt immateriellt rättsskydd 122, 123; Paul Torremans, ‘The Widening Reach of Exclusive Jurisdiction: Where Can You Litigate IP Rights after GAT?’ in Arnaud Nuyts, International Litigation in Intellectual Property and Information Technology (Kluwer 2008) 61; Marcus Norrgård, ‘A Spider Without a Web? Multiple Defendants in IP Litigation’ in Stefan Leible and Ansgar Ohly (eds), Intellectual Property and Private International Law (Tübingen, Mohr Siebeck 2009) 217; Luigi Fumagalli, ‘Litigating Intellectual Property Rights Disputes Cross-Border: Jurisdiction and Recognition of Judgments under the Brussels I Regulation’ in Bariatti (ed.), Litigating Intellectual Property Rights (n 31 Chapter I) 15; Annette Kur and Benedetta Ubertazzi, ‘The ALI Principles and the CLIP Project– A Comparison’ in Bariatti (ed.), Litigating Intellectual Property Rights (n 31 Chapter I) section 1 and subsection 2(c). See also Rafael Arenas, ‘El Reglamento 44/2001 y las cuestiones incidentals: dar vueltas para (casi) volver al mismo sitio’ (2011) La Ley-Unión Europea 1-19. But compare, Manlio Frigo, ‘Proprietà intellettuale, Gli standards di tutela dell’UE a confronto con gli standard internazionali’ Address at the Italian Society of International Law XV Congress in Bologna (10-11 June 2010), available at accessed 30 November 2011 (according to which the GAT decision should be positively evaluated since it grants the principle of legal certainty in conformity with Article 6 of the ECHR. Indeed, as will be explained in greater detail infra, in chapter VI, this last Article militates against exclusive jurisdiction provisions). 33 See Ian Brownlie, Principles of Public International Law (7th edn, OUP 2008) 504. 34 See chapter III for further clarification of the use of these terms interchangeably. See Jake Tyshow, ‘Informal Foreign Affairs Formalism: The Act of state Doctrine and the Reinterpretation of International Comity’ (2002) 43 Va. J. Int’l L. 278, 298. This article also describes the similarities and differences between comity and the Act of State doctrine.

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Chapter I: Introduction

ly”35 the goals that must be accomplished by adopting it, including the need to avoid harmful effects on international stability, interaction among nations and “the practical desirability of making decisions which would ‘further the development of an effectively functioning international system’”36. Therefore, “the question of extending comity touches upon issues concerning the interaction of sovereign nations – matters typically within the scope of public international law”37 and comity can be defined as a non-binding principle governing international affairs or as “a bridge between public and private international law”38. The decisions examined here, then, seem in line with attempts to develop a general public international law theory of allocation of jurisdiction in civil matters that began in the 18th century in the Netherlands; continued to develop in Anglo-American legal systems; was popular in Germany around the turn of the 19th century39; has “more recently been revived by [certain] public international lawyers”40; and is based on “comity” reasons41. In con35

Nadine Jansen Calamita, ‘Rethinking Comity: Towards a Coherent Treatment of International Parallel Proceedings’ (2006) 27 U. Pa. J. Int’l Econ. L. 601, 623. 36 Ibid 622. 37 Ibid 619. See also Harold G. Maier, ‘Extraterritorial Jurisdiction at a Crossroads: an Intersection between Public and Private International Law’ (1982) 76 AJIL 280, 281 (“the doctrine of comity is not a rule of public international law, but the term characterizes many of those same functional elements that define a system of international legal order”). See also Thomas H. Hill, ‘Sovereign Immunity and the Act of state Doctrine. Theory and Policy in United States Law’ (1982) 46 RabelsZ 126. 38 Calamita (n 35 Chapter I) 619. See also Jörn Axel Kämmerer, ‘Comity’ in Rüdiger Wolfrum (ed), Max Planck Encyclopedia of Public International Law (OUP 2006) accessed 30 November 2011, according to whom “comity does not pertain to the sources of international law as provided for in Article 38(1) of the Statute of the International Court of Justice” on which see infra, para 13. “Nonetheless, it has always been a matter of interest in public international law”. See also Cedric Ryngaert, Jurisdiction in International Law (OUP 2008) 143 and Azar Deborah, ‘Simplifying the Prophecy of Justiciability in Cases Concerning Foreign Affairs: a Political Act of State Question’ (2010) 9 Rich. J. Global L. & Bus. 482. 39 See the studies of Ulrich Huber and Story, referred to by Maier (n 37 Chapter I) 280, and there the necessary references, and respectively the studies of Zitelmann and Frankenstein, referred to by Ralf Michaels, ‘Public and Private International Law: German Views on Global Issues’ (2008) 4 J. Priv. Int’l L. 125. 40 Michaels, ‘Public and Private International Law’ (n 39 Chapter I) 125. 41 Ibid 130. See also Maier (n 37 Chapter I) 281. On comity as a PIL rule in general see Lawrence Collins, ‘The United States Supreme Court and the Principles of Comity: Evidence in Transnational Litigation’ (2006) 8 Y.B. Priv. Int’l L. 53; Donald Earl Childress III, ‘Comity as Conflict: Resituating International Comity as Conflict of Laws’ (2010) 44 U.C. Davis L. Rev. 11; Francisco Javier Zamora Cabot, ‘On The International Comity In The Private International Law System Of The U.S.A’ (2010) 19 Revista Electrónica de Estudios Internacionales 1 accessed 30

I. Premise

9

trast, this book adopts the opinion that “these attempts have been unsuccessful”42; public international law does not limit a State’s exercise of jurisdiction to inside its borders43, and “public international law can play a role in private international law [only] in […] the broader conception of human rights”44, imposing the duty of granting the right of access to courts upon the States and therefore the abandoning of their international jurisdiction provisions inconsistent with this right, namely the exorbitant45 and exclusive46 jurisdiction rules, of which this book examines only the latter and in relation to IPRs. November 2011. On comity as a PIL rule with respect to IPRs, see John Braithwaite and Peter Drahos, Global Business Regulation (New York, Cambridge University Press 2000) 58. See also William Patry, ‘Choice of Law and International Copyright’ (2000) 48 Am. J. Comp. L. 383, 416, who, however, concentrates on copyright conflict of laws issues rather than on the international procedural matters examined here. 42 Michaels, ‘Public and Private International Law’ (n 39 Chapter I) 125, 130. See also Alex Mills, The Confluence of Public and Private International Law. Justice, Pluralism and Subsidiarity in the International Constitutional Ordering of Private Law (Cambridge University Press 2009) 23. 43 Save in exceptional circumstances, such as those concerning subjects that are immune from foreign jurisdiction. As regards immunity from jurisdiction with respect to issues related to IPRs, see Virginia Morris, ‘Sovereign Immunity: The Exception for Intellectual or Industrial Property’ (1986) 19 Vand. J. Transnat’l L. 115; Akihiro Matsui, ‘Intellectual Property Litigation and Foreign Sovereign Immunity: International Law Limit to the Jurisdiction over the Infringement of Intellectual Property’ (2003) Institute of Intellectual Property, Tokyo accessed 30 November 2011; Benedetta Ubertazzi, ‘Intellectual Property and State Immunity from Jurisdiction in the New York Convention of 2004’ (2009) 11 Y.B. Priv. Int’l L. 599, see here for the necessary case law references originating in different countries. 44 Michaels, ‘Public and Private International Law’ (n 39 Chapter I) 125, 130. 45 See Carlo Focarelli, ‘The Right of Aliens not to be Subject to So-Called “Excessive” Civil Jurisdiction’ in Benedetto Conforti and Francesco Francioni (eds), Enforcing International Human Rights in Domestic Courts (Martinus Nijhoff 1997) 441; Diego P. Fernández Arroyo, ‘Compétence exclusive et compétence exorbitante dans les relations privées internationales’ (2006) 323 Recueil des Cours de l’Académie de droit international de La Haye 9; Giuditta Cordero Moss, ‘Between Private and Public International Law: Exorbitant Jurisdiction as Illustrated by the Yukos Case’ (2007) 32 Review of Central and East European Law 1; Ryngaert (n 38 Chapter I) 165; Nerina Boschiero, ‘Las reglas de competencia judicial de la Unión Europea en el espacio jurídico internacional’ (2009) 9 AEDIPr 35, 47. On the impact of the fundamental human right of access to a court (due process) with respect to the issue of (exorbitant) international jurisdiction, see Franz Matscher, ‘IPR und IZVR vor den Organen der EMRK – Eine Skizze’ in Werner Barfuss, Bernard Dutoit, Hans Forkel, Ulrich Immenga and Ferenc Majoros (eds), Festschrift für Karl H. Neumayer zum 65. Geburtstag (Nomos 1985) 459; Peter Schlosser, ‘Jurisdiction in International Litigation—The Issue of Human Rights in Relation to National Law and to the Brussels Convention’ (1991) LXXIV RDI 5; Emmanuel Guinchard, ‘Procès equitable (article 6 CESDH) et droit international privé’ in Arnaud Nuyts and Nadine Watté (eds), International Civil Litigation in Europe and Relations with Third States (Bruxelles, Bruylant 2005) 199; James Fawcett, ‘The Impact of Article 6(1) of the ECHR on Private International Law’ (2007) 56 Int’l & Comp. L. Q. 6, 36; Fabien

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Chapter I: Introduction

2. What is Included in Exclusive Jurisdiction Rules and what is not. Exclusive Jurisdiction and Subject Matter Jurisdiction. The notion of exclusive jurisdiction adopted in this book only covers the asaspects of foreign IPRs litigation that are typically included in the corresponding rules47: namely the IPR subsistence, scope, validity, registration and infringement48. It excludes disputes that can affect some of those issues but where the real object of the litigation49 is different, notwithstanding the fact that they may result in decisions that can be the basis for changes in the records of the registries of a State50, namely inter alia IPRs first ownership and entitlement issues51, as well as transferability and assignability matters and the contractual transfer of ownership52. Marchadier, Les objectifs généraux du droit international privé à l’épreuve de la convention des droits de l’homme (Bruylant 2007) 37. 46 For the abandoning of any exclusive jurisdiction provision see Fernández Arroyo, ‘Compétence exclusive’ (n 45 Chapter I). 47 See Stefania Bariatti, ‘La giurisdizione e l’esecuzione delle sentenze in materia di brevetti di invenzione nell’ambito della C.E.E.’ [1982] RDIPP 511; Paul Torremans, ‘The Sense or Nonsense of Subject Matter Jurisdiction over Foreign Copyright’ (2011) 33(6) EIPR 349356. For a comparative analysis of those rules see infra, chapter II. 48 See Bariatti, ‘La giurisdizione’ (n 47 Chapter I) 516; Torremans, ‘The Sense or Nonsense’ (n 47 Chapter I) 349. See infra chapter II for a detailed comparison of the relevant rules. 49 See infra, the following remarks of this para. 50 See Bariatti, ‘La giurisdizione’ (n 47 Chapter I) 516; Torremans, ‘The Sense or Nonsense’ (n 47 Chapter I) 349. 51 See Case 288/82 Duijnstee v Goderbauer [1983] ECR 3663, infra para 8, with regard to disputes concerning the right to a patent when what is involved is an invention of an employee. Yet “doubtless, the same will be true even if it is not an invention of an employee”, as such James Fawcett and Paul Torremans, Intellectual Property and Private International Law (2nd edn, OUP 2011) 20. See the French Cour de Cassation’s ruling in GRE Manufacturas v Agrisilos [2006] I L Pr 27, according to which the exclusive jurisdiction rule of the Brussels system, namely Article 22(4) of the Brussles I Regulation, does not apply where the issue was wether the defendant possessed the right. For a case on ownership and entitlement see Distric Court of Utrecht’s ruling in Roucar Gear Technologies BV v Four Stroke SARL vase 277615/HA ZA 09-2640, 30 June 2010 available at accessed 30 November 2011. See Fawcett and Torremans (n 51 Chapter I) 20. Finally see Shigeki Chaen, Toshiyuki Kono and Dai Yokomizo, ‘Jurisdiction in Intellectual Property Rights Cases’ in Basedow, Kono and Metzger (n 2 Chapter I) 90 according to whom “there is no reason to require that the country of registration that grants the right has exclusive jurisdiction over actions concerning the ownership of an IP right”. See also infra, para 75. 52 The inclusion of the transferability matter in exclusive jurisdiction rules remains unclear. Yet, according to prevailing opinion, issues that arise by virtue of the transfer of a right by contract are not covered, even though changes in the registries entries related to the right might be necessary. See Paris Cour d’Appel, in SA des Etablissements Salik et SA Diffusal v SA J Esterel, discussed in RCDIP (1982) 135. See also Fawcett and Torremans (n 51 Chapter I) 20.

I. Premise

11

As for the subsistence, scope, validity and registration notions included in exclusive jurisdiction rules they relate inter alia to the definition of the varivarious categories of protected works, the originality, novelty and legal requirements, the granting, the fixation, the registration (including its abandonment or revocation) and the scope of protection, namely the various exclusive rights and the way in which they are defined and limited as well as the term of the right in question53. For present purposes the notions of subsistence, validity, registration and scope of an IPR will be altogether referred to with the category of “validity”. Additionally the notion of validity claims includes claims that have as their object the (in)validity of the IPR (validity issues principally raised), as well as the claims where the defendant in an IPR infringement action or the claimant in a declaratory action to establish that the IPR is not infringed plead that the IPR is invalid and that there is no infringement of that right for that reason (validity issues incidentally raised). In addition, the following specifications are necessary54. The notion of proceeding on validity issues principally raised comprises “proceeding[s] concerned with the registration or validity of patents, trade marks, designs, or other similar rights required to be deposited or registered”55; “proceedings relating to the registration or validity of a patent”56; “proceedings in which the relief sought is a judgment on the grant, registration, validity, abandonment, revocation […] of a patent or a mark”57; “the adjudication of the validity of registered rights granted under the laws of another State”58; “disputes having as their object a judgment on the grant, registration, validity, abandonment or revocation of a patent, a mark, an industrial design or any other intellectual property right protected on the basis of registration”59; “actions concerning the existence, registration, validity or ownership of foreign intellectual property rights”60; and “dispute[s] arising out of acquiring, registering, disclaiming or revoking 53 See Torremans, ‘The Sense or Nonsense’ (n 47 Chapter I) 351, criticising however the exclusion from this notion inter alia of the transferability and first ownership matters. See infra the following remarks of this para. 54 For further discussion of the below mentioned articles and provisions see generally para 5 and chapter II. 55 Article 22(4) of the Brussels system, on which see the following remarks of this para. 56 GAT v LuK (n 32 Chapter I) para 31. On this case see infra, para 8. 57 Article 12(4) Alternative A of The Hague Preliminary Draft Convention on Jurisdiction (n 13 Chapter I). 58 Section 211(2) of ‘Intellectual Property: Principles Governing Jurisdiction, Choice of Law, and Judgments in Transnational Disputes’ (Proposed Final Draft, 30 March 2007), The American Law Institute (Philadelphia 2007) 305 (ALI Principles). 59 Article 2:401(1) of the ‘Principles for Conflict of Laws in Intellectual Property’, European Max Planck Group on Conflict of Laws in Intellectual Property (CLIP Principles) (published 31 August 2011). Available at accessed 30 November 2011. 60 Article 103(2) of the Transparency Proposal published in Basedow, Kono and Metzger (n 2 Chapter I) 394.

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Chapter I: Introduction

and validity of intellectual property rights”61. This alternate terminology demonstrates that there are a number of basic elements involved in the matters included in exclusive jurisdiction rules62. So, some rules63 avoid the wording “validity”, and designate explicitly the matters falling under exclusive jurisdiction rules, namely by enumerating and spelling out the various elements, showing clearly the limited number of scenarios that may give rise to exclusive jurisdiction. Furthermore, the notion of validity issues incidentally raised comprises proceedings in which the ruling related to the validity issue “shall have no binding effect in subsequent proceedings, even if they are between the same parties”64; that are “effective only to resolve the dispute among the parties of the action”65; that “do not affect the validity or registration of those rights as against third parties”66; that “shall only be effective as between the parties to the action”67; and that “do not affect later claims”68. Finally, the notion of validity issues incidentally raised comprises “issue[s] […] raised […] as a defence”69; “issue[s] […] raised […] as a plea in objection”70; “incidental question[s]” intended as a matter for which “the court is not requested to give a judgment […], even if a ruling on it is necessary in arriving”71; “defenses related to the invalidity of registered rights”72; “validity or registration” issues “arise[n] in a context other than by principal claim or counterclaim”73; “actions brought concerning the existence, registration, validity, or ownership of intellectual property rights prescribed under foreign law” when this action is brought incidentally74; and disputes arisen in “the context of preliminary or 61

Article 209 of the Commentary on Principles of Private International Law on Intellectual Property Rights, Joint Proposal Drafted by Members of the Private International Law Association of Korea and Japan (Waseda University Global COE Project) of 14 October 2010 (Waseda Proposal) available at accessed 30 November 2011. 62 See the following remarks. 63 See Article 2:401(1) of the CLIP Principles (n 59 Chapter I). 64 Article 12(6) Alternatives A and B of The Hague Preliminary Draft Convention on Jurisdiction (n 13 Chapter I). 65 Section 211(2) of the ALI Principles (n 58 Chapter I). 66 Article 2:401(2) of the CLIP Principles (n 59 Chapter I). 67 Article 103(3) of the Transparency Proposal (n 60 Chapter I). 68 Article 209(2) of the Waseda Proposal (n 61 Chapter I). 69 Article 22(4) of the Convention on jurisdiction and the recognition and enforcement of judgments in civil and commercial matters [2007] OJ L339/3 (Lugano Convention), on which see the following remarks of this para and chapter II. 70 GAT v LuK (n 32 Chapter I) See conclusions. 71 Article 12(6) of The Hague Preliminary Draft Convention on Jurisdiction (n 13 Chapter I). 72 Section 212(4) of the ALI Principles (n 58 Chapter I). 73 Article 2:401(2) of the CLIP Principles (n 59 Chapter I). 74 See Article 13(2) of the Transparency Proposal (n 60 Chapter I).

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incidental questions”75. Yet, even given the different languages of the rules just referred to, in practice they lead to similar results76. For simplicity reasons the following remarks will adopt the terms validity claims or validity proceedings, inter partes effects and validity issues incidentally raised, comprehensively intended, unless specified differently. As for the infringement notion, it encompasses cases where a person who is not the owner or licensee and assignee of the owner of the IPR copies, reproduces, or exercises any of the exclusive rights granted in respect to the IPR in question without the license or consent of the IPR owner. Furthermore, infringement proceedings comprise both claims where the plaintiff brings an IPR infringement action or where the claimant starts a declaratory action to establish that the IPR is not infringed. The term pure infringement claims will be adopted to denote infringement disputes where the validity of the IPR involved is not raised. Additionally, the term transnational misappropriation of IPRs will be used synonymously with transnational infringement of IPRs. The term protection will be treated as synonymous to judicial enforcement. Having said that, it is necessary to clarify the reasons for my adoption throughout this book of the term exclusive jurisdiction, which is proper of civil law countries, rather than the corresponding notions of subject matter jujurisdiction or justiciability that are typical of common law States. In this rerespect there is a view that the two systems are “significantly different”77, but this view does not convince78. In fact, European law does not distinguish between personal and subject matter jurisdiction, whereas American law adopts the categories of general, special and exclusive jurisdiction but links those categories to both personal and subject matter jurisdiction, therefore understanding them in a different way than in Europe79. However, on the one hand “American and European law provide functionally equivalent methods for resolving the same problems, [although] they cannot agree on, much less unify, these methods”80. On the other hand, at least with respect to IPR cases, it seems that a “good part of the impression”81 that the two systems are “significantly different”82 “ensues from differences in style and structure rather than 75

Article 209(2) of the Waseda Proposal (n 61 Chapter I). See chapter II. 77 Ralf Michaels, ‘Two Paradigms of Jurisdiction’ (2006) 27 Mich. J. Int’l L. 1011. 78 Kur and Ubertazzi (n 32 Chapter I) 92. 79 Ibid. See also Anna Gardella and Luca Radicati di Brozolo, ‘Civil Law, Common Law and Market Integration: EC Approach to Conflicts of Jurisdiction’ (2003) 51 Am. J. Comp. L. 611; Arnaud Nuyts, ‘Due Process and Fair Trial: Jurisdiction in the United States and in Europe Compared’ in Nuyts and Watté (n 45 Chapter I) 157; Michaels, ‘Two Paradigms of Jurisdiction’ (n 77 Chapter I) 1011. 80 Michaels, ‘Two Paradigms of Jurisdiction’ (n 77 Chapter I) 1011. 81 Kur and Ubertazzi (n 32 Chapter I) 92. 82 Michaels, ‘Two Paradigms of Jurisdiction’ (n 77 Chapter I) 1011. 76

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from differences in substance”83. Therefore, although this book adopts the notion of exclusive jurisdiction, which is rooted in the European legal tradition rather than the categories of subject matter jurisdiction or justiciability used by the Common Law systems, it aims at proposing a thesis applicable at least to both of those legal systems. Yet, the following specifications should be added. Article 16(4) of the Brussels Convention, now Article 22(4) of the Brussels I Regulation84, and Article 22(4) of the Lugano Convention85 establish exclusive jurisdictions with respect to certain IPRs claims86. For present purposes the Brussels Con83

Kur and Ubertazzi (n 32 Chapter I) 92. Council Regulation (EC) 44/2001 of 22 December 2000 on jurisdiction and the recognition and enforcement of judgments in civil and commercial matters [2001] OJ L12/1 (Brussels I Regulation), transformed into a Community legal instrument (communitarized) the Convention of 27 September 1968 on jurisdiction and recognition and enforcement of judgments in civil and commercial matters [1972] OJ L299/32 (Brussels Convention). On the text of Article 22(4) of the Brussels I Regulation see the following remarks. The Brussels I Regulation is undergoing a recasting process. See Commission, ‘Proposal for a Regulation of the European Parliament and of the Council on jurisdiction and the recognition and enforcement of judgments in civil and commercial matters’ COM (2010) 748 final, available at accessed 30 November 2011. This proposal slightly changes the text of Article 22(4) into the following: “The following courts shall have exclusive jurisdiction, regardless of domicile: 4. in proceedings concerned with the registration or validity of patents, trade marks, designs, or other similar rights required to be deposited or registered, irrespective of whether the issue is raised by way of an action or as a defence[25], the courts of the Member State in which the deposit or registration has been applied for, has taken place or is under the terms of a Community instrument of the Union or an international convention deemed to have taken place. Without prejudice to the jurisdiction of the European Patent Office under the European Patent Convention (n 3 Chapter I), the courts of each Member State shall have exclusive jurisdiction, regardless of domicile, in proceedings concerned with the registration or validity of any European patent granted for that State”. 85 See the Lugano Convention of 30 October 2007 (n 69 Chapter I), concluded between the European Union and certain member States of EFTA: Switzerland, Norway, Iceland, available at accessed 30 November 2011. Article 22(4) of the Lugano Convention establishes that “The following courts shall have exclusive jurisdiction, regardless of domicile: […] 4. in proceedings concerned with the registration or validity of patents, trade marks, designs, or other similar rights required to be deposited or registered, irrespective of whether the issue is raised by way of an action or as a defence, the courts of the State bound by this Convention in which the deposit or registration has been applied for, has taken place or is, under the terms of a Community instrument or an international convention, deemed to have taken place. Without prejudice to the jurisdiction of the European Patent Office under the Convention on the grant of European patents, signed at Munich on 5 October 1973, the courts of each State bound by this Convention shall have exclusive jurisdiction, regardless of domicile, in proceedings concerned with the registration or validity of any European patent granted for that State irrespective of whether the issue is raised by way of an action or as a defence”. 86 See the following remarks. 84

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vention and the Brussels I Regulation are jointly referred to as “the Brussels System” together with the Lugano Convention. Particularly, Article 22(4) of the Brussels I Regulation establishes that “the following courts shall have exclusive jurisdiction, regardless of domicile: […] in proceedings concerned with the registration or validity of patents, trade marks, designs, or other similar rights required to be deposited or registered, the courts of the Member State in which the deposit or registration has been applied for, has taken place or is under the terms of a Community instrument or an international Convention deemed to have taken place. Without prejudice to the jurisdiction of the European Patent Office under the Convention on the Grant of European Patents, signed at Munich on 5 October 1973, the courts of each Member State shall have exclusive jurisdiction, regardless of domicile, in proceedings concerned with the registration or validity of any European patent granted for that State”. Thus, under this rule “there is no direct subject matter limitation on jurisdiction in cases involving the issue of creation of foreign IPRs. However, it should be remembered that when Article 22(4) operates it not only gives the courts of one member State/EFTA State jurisdiction, but also, because this is exclusive jurisdiction, it deprives the courts of other member States/EFTA States of jurisdiction. To this extent there can be said to be a subject matter limitation of jurisdiction, albeit in an indirect form [...]. Under the traditional English rules, there is a well-known subject matter limitation on jurisdiction in relation to the validity of foreign IPRs. The effect of this is essentially the same as Article 22(4). It differs, though, in that it is a direct limitation on jurisdiction. This common law limitation on jurisdiction cannot be applied in Brussels I Regulation and Lugano Convention cases”87. Furthermore, leading commentators invoke the abandoning of subject matmatter jurisdiction or justiciability notions in relation to IPRs cases, not only for all the reasons that will be addressed by this book with regard to exclusive jurisdiction rules as well, but also for the following two arguments. According to the first approach, the subject matter jurisdiction notion is inconsistent, in that it is difficult to exclude the transferability, initial ownership and even contractual transfer of ownership issues from the scope of subject matter jurisdiction. In fact, those issues relate to matters included in the subsistence of the right as well88. Therefore, it “would be preferable to scrap the [subject matter jurisdiction] doctrine altogether […] giving reflexive effect to the

87

Fawcett and Torremans (n 51 Chapter I) 43-44. See Torremans, ‘The Sense or Nonsense’ (n 47 Chapter I) 352, criticising the UK Court of Appeal’s judgment in Crosstown Music because of its having excluded from the subject matter jurisdiction scope the (unregistered) IPRs ownership and assignment issues. See Crosstown Music (n 29 Chapter I). 88

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Chapter I: Introduction

ground for exclusive jurisdiction”89 provided for by Article 22(4) of the Brussels system, rendering it applicable to third States registered IPRs as well. In fact, this Article does not apply to the transferability, initial ownership and even contractual transfer of ownership issues either. So, it seems that the inconsistency of the exclusion of those issues remains even with respect to Article 22(4) of the Brussels system, for the same reasons highlighted by the opinion under examination. According to a second approach, that is invoked in relation to copyrights but that can reasonably be extended, mutatis mutandis, to other IPRs even of a registered nature, “a jurisdictional prohibition, resting on a justiciability principle […] risks stripping a significant amount of the value of a copyright owner’s rights by rendering them unenforceable in the defendant’s forum – with the only alternative being litigating in the various fora under whose laws the right subsist. Even that possibility may be more theoretical than real, if judgments subsequently secured cannot be enforced in the defendant’s forum”90. Therefore, according to this approach rather than declining jurisdiction by virtue of a non-justiciability perspective, courts should adopt the forum non conveniens doctrine, which, however, should be restrictively interpreted91. Yet, it seems that the criticisms highlighted by this approach with regard to the non-justiciability or subject matter jurisdiction notions are extendable to exclusive jurisdiction as well92, even though the forum non conveniens doctrine cannot be applied in the frame of the Brussels system93. 3. Peculiarities Related to the Analysis of the Lucasfilm and Gallo cases, and a Brief Mention of Apple’s and Samsung’s Still Unsettled Patent War around the Globe In light of the particular circumstances surrounding the Lucasfilm Entertainment Co. v Ainsworth94 and of the Gallo v Sting Music95 cases, these two cases will be analysed in a somewhat unusual way. With respect to the Lucasfilm case, the UK Court of Appeal’s 16 December 2009 decision in this case was reversed by the UK Supreme Court on 27 July 2011. However, the UK Court of Appeal’s decision is one of the most recent expressions of the jurisprudence involving the application of exclusive jurisdiction within the context of IPRs cross-border litigation and is reflective of the traditional argu89

Torremans, ‘The Sense or Nonsense’ (n 47 Chapter I) 356. On the reflexive effect of Article 22(4) of the Brussels I Regulation see infra para 20. 90 See Austin, ‘The Concept of "Justiciability"’ (n 29 Chapter I) 409. See also infra, chapter VI of this book. 91 See infra, para 76. 92 See infra, chapter VI. 93 See infra, para 76. 94 Lucasfilm Entertainment (n 29 Chapter I). 95 Gallo (n 28 Chapter I).

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ments against cross-border litigation that are still being made in other countries. Additionally, before the UK Court of Appeal’s decision was reversed, it strongly influenced other courts’ decisions around the world, such as the Gallo case. As such, criticisms of the approach taken by the Court of Appeal are still relevant, even though its holding has been overturned. Thus, this book will analyse the decisions of both the UK Court of Appeal and the UK Supreme Court in the Lucasfilm case. With respect to the Gallo 3 September 2011 judgment, just mentioned, in it the South Africa Supreme Court of Appeal reached its conclusions following the authority and adopting an analogous reasoning, mutatis mutandis, of the UK Court of Appeal’s Lucasfilm decision. Thus, to avoid redundancy of analysis, this book will generally examine only the UK Court of Appeal’s Lucasfilm decision under the premise that the remarks relating to it may be extended, mutatis mutandis, to the Gallo ruling. However, to provide some context, the main elements of the Gallo case will be briefly detailed below. In the Gallo case, five plaintiffs issued summons against certain defendants domiciled or resident in South Africa, claiming the protection of the copyright owned by them (by assignment or as original authors) over the musical Umoja. The plaintiffs alleged that the defendants had infringed their copyright by performing, in whole or in part, the musical of Umoja; by making recordings and cinematograph films thereof; and by having it broadcast in South Africa since 2001, as well as in a large number of other countries, 19 in all, ranging from Japan in the east to the USA in the west96. Thus, the plaintiffs requested the South African Court order the defendants to pay damages in relation to these infringements under the South African Copyright Act for the infringement allegedly perpetrated in South Africa, as well as under the respective copyright laws of each of the other countries involved97. However, the Supreme Court of Appeal held that “IPRs, including copyright, are immovable intangibles and […] local courts do not have jurisdictions in respect of foreign copyright issues”98. In light of this conclusion it is apparent that in the Court’s opinion the plaintiffs should have started proceedings in each and every jurisdiction where the copyright infringement allegedly took place, namely in each of the 20 countries involved. Finally, the consequences of adopting a restrictive jurisdictional approach within the context of IPRs transnational disputes are currently exemplified by a global patent war between Samsung and Apple. As of 20 August 2011, their dispute had triggered 19 lawsuits in 12 courts in 9 countries on 4 continents99. 96

Gallo (n 28 Chapter I) 2-4. Ibid. 98 Ibid 19. 99 See ‘Apple vs. Samsung: list of all 19 lawsuits going on in 12 courts in 9 countries on 4 continents’ (FOSS Patents, 20 August 2011) accessed 30 November 2011. 97

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In light of the very early stage of this litigation at the time this book was going to press, with the majority of the proceedings still in the preliminary injunction phase, the following remarks will be limited to briefly mentioning the main elements of the patent war at stake. Apple, an American company, and Samsung, a South Korean company, are both technology producers. In 2010 Samsung supplied Apple “with about US$5.7-billion in components […], some 4 per cent of its total sales, and the portion grew to 5.8% in the first-quarter, driven by booming iPad and iPhone sales, which Samsung supplies chips for”100. However, Samsung is also an Apple competitor, with its Galaxy line of products including smart phones and tablets competing with the Apple iPhone and iPad. In early 2011, Apple alleged that Samsung’s Galaxy line of products infringed upon Apple’s IPRs in the iPhone and iPad, which Samsung strongly denies. This initial dispute between the two companies started a firestorm of suits and countersuits, involving multiple patents, designs and trademarks registered all over the world. Yet, because of exclusive jurisdiction rules, the companies could not pursue their claims in a single proceeding before the courts of a single State, and therefore had to file suits in each country where the individual IPRs involved are registered. Thus, on 18 April 2011, Apple sued Samsung in a US Federal Court, alleging that Samsung’s Galaxy line of smart phones and tablets slavishly copied Apple’s iPhone and iPad, and therefore infringed upon a number of Apple’s patents, trademarks, and trade dresses101. In response, Samsung filed patent infringement lawsuits against Apple in South Korea, Japan, and Germany102. In the following months, additional suits were filed by both Apple and Samsung in other countries around the world, resulting in the number of pending cases already referred to103. Finally, even though Samsung redesigned one of its tablet computers after courts banned sales inter alia in Germany104, Apple may wish to request new injunctions or claim that the refreshed device infringes the existing courts order105, demonstrating as such the difficulties related to the so called “design around” problem106. 100

See ‘Jobs’ exit opens door for nimble Apple rivals’ (Financial Post, 25 August 2011)

accessed 30 November 2011. 101 See ‘Apple vs. Samsung’ (n 99 Chapter I). 102 Ibid. 103 Ibid. 104 See ‘Samsung redesigns Galaxy Tab after Apple’s sales ban’ (BBC News, 17 November 2011) accessed 30 November 2011. 105 Ibid. 106 Trimble Landova, ‘When Foreigners Infringe Patents’ (n 1 Chapter I) 505, explaining the design-around problem in the following terms: “Upon a finding of infringement (and often even before then) the infringer replaces the infringing product or component with a product or component that is redesigned to circumvent the infringed patent. When the patent hold-

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To sum up, even at this early stage of litigation, a comparison of the preliminary injunctions that have already been granted by courts in Germany, the Netherlands and Australia highlight the risk of conflicting decisions: the high costs to both companies, in terms of litigation and country-specific modifications to meet the terms of the injunctions; and the likelihood that any attempts to settle this dispute judicially, through individual national proceedings, will be inefficient, irresolute, and ineffective107. 4. Uniform European Union Patent and Unified Patent Litigation System: Where do we Stand? The Convention on the Grant of European Patents (European Patent Convention, hereinafter: EPC)108 is a multilateral treaty that establishes a unitary procedure for obtaining patent protection in EPC Contracting States. The treaty was originally signed in Munich on 5 October 1973. It is ratified by 38 States, including all the EU Member States plus 11 other countries, but the EU itself is not a party109. The EPC coexists with Member States’ national patent systems that still grant protection to patents through applications filed with their respective domestic patent offices. According to the EPC procedure, applicants prosecute a single application for a “European Patent” before the European Patent Office (the ‘EPO’) and designate the Contracting States in which they are seeking protection. Thus, the EPC centralises the searching, examination, and granting of European patents110. A European Patent can have legal effect as a national patent in the States of the EPC, but the protection is limited to those States where the patent proprietor explicitly sought protection and does not automatically extend to all EPC member States. Additionally, the European patent does not take effect until it is validated in those selected States, which involves significant translation expenses and publication fees111. Furthermore, while the procedure for the granting of the European patent is unitary, the enforcement of the granted right is not unitary. Instead, the patent owner actually holds a bundle of national patents, which must be individually enforced in the respective designated States and according to their specific laws. Although the EPC mandates certain rules be uniform across Member States, the lack of a centralized enforcement body means that there is still a very strong risk for conflicting er asks a court to enforce the injunction against the infringer, the infringer claims that the new product or component is redesigned sufficiently such that it no longer falls within the original injunction. The result of a court’s decision on the design-around argument has crucial significance for the right holder because a finding that the design-around avoids the injunction means that the only recourse the right holder has is to engage in new litigation”. 107 See ‘Samsung hobbles tablet to appease Apple’ (BBC News Technology, 3 October 2011) accessed 30 November 2011, according to which “Samsung has also reportedly made an offer to settle the dispute between the two firms so it can get on and launch the tablet in Australia”.

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Chapter I: Introduction

decisions among individual countries with respect to the same European patent. To improve the current situation within the EU, in 2000 the EU began taktaking additional steps towards establishing a unified patent litigation system (UPLS)112. In 1997 the European Commission published the Green Paper on “the Community Patent and the patent system in Europe. Promoting innovation through patents”113. In 2000 the European Commission presented a Draft Proposal for a Regulation on the Community Patent, which provided the Eu108 European Patent Convention (n 3 Chapter I), as revised by the Act revising Article 63 EPC of 17 December 1991 (entered into force 4 July 1997) OJ EPO 1992/1 and the Act revising the EPC of 29 November 2000 (entered into force 13 December 2007) OJ EPO 2001, Special Edition No. 4, p. 55. Text available at accessed 30 November 2011. The Convention entered into force on 7 October 1977 and as of 1 October 2010 is binding on 38 States. Text available at accessed 30 November 2011. On this Convention see Geoffrey Tookey, ‘The Draft European Patent Convention’ (1965) 14 Int’l & Comp. L. Q. 281; Philip Leith, ‘Revision of the EPC, the Community Patent Regulation and “European Technical Judges”’ (2001) 23 EIPR 250. See also the Lugano Convention (n 69 Chapter I) and Explanatory Report by Professor Fausto Pocar (Chair of International Law at the University of Milan) [2009] OJ C 319/26. 109 See Stefan Luginbuehl, European Patent Law: Towards a Uniform Interpretation (Edward Elgar 2011). See also José Miguel Lissén and Sergio Poza, ‘The Project for a Uniform European Union (EU) Patent and a Unified Patent Litigation System within the EU: Closer Than Ever, But With Some Detractors’ (2011) XL VI Les Nouvelles 237-243. 110 A single patent application is processed only in English, French or German. Each patent application, if granted, is published 18 months after the application filing date and is written in the same language of the proceeding together with a translation of the claims in the two other working languages of the EPO. See Lissén and Poza (n 109 Chapter I) 237. 111 To validate a European patent States generally require a translation of the European patent into the official language of the said State, other formal requirements and the payment of publication fees. The system as it stands “hinder the access to patent protection in Europe of small and medium size companies and public organisations, thereby discouraging innovation and competitiveness”, Lissén and Poza (n 109 Chapter I) 238. See details on the relevant translation costs and publication fees on pages 237-238. 112 On the UPLS, see the following relevant legal documents at accessed 30 November 2011. In literature see Luginbuehl (n 109 Chapter I) 252; Thomas Jaeger, Reto Hilty, Josef Drexl and Hanns Ullrich, ‘Comments of the Max Planck Institute for Intellectual Property, Competition and Tax Law on the 2009 Commission Proposal for the Establishment of a Unified Patent Judiciary’ (2009) 40 IIC 818; Jochen Pagenberg, ‘The ECJ on the Draft Agreement for a European Community Patent Court – Hearing of May 18, 2010’ (2010) 41 IIC 695; Sven Bostyn, ‘The Unbearable Heaviness of Harmonization: SPLT and CP’ in Marco Ricolfi (ed), I brevetti per invezione fra diritto europeo e nazionale (Milan, Giuffrè 2004) 128; Jurgen Schade, ‘Is The Community (EU) Patent Beyond the Times? – Globalisation Urges Multilateral Cooperation’ (2010) 41 IIC 806. 113 Available at accessed 30 November 2011. See Luginbuehl (n 109 Chapter I) 252.

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ropean Community with the ability to accede to the EPC. In addition, it provided for the granting of a unitary patent right, a “Community patent”, by the EPO that would be valid throughout the EU and would coexist with the European and the national patents114. In 2007 the Commission presented a communication to the European Parliament and to the Council entitled “Enhancing the patent system in Europe”, proposing, among other things, to create a unified and specialised patent judiciary with competence for litigation on European patents and future Community patents, then called EU patents115. It reiterated support for the type of unitary system described in the Council Regulation proposal: a patent granted by the EPO according to the EPC norms (to the extent such provisions did not conflict with specific rules provided by the proposed Regulation), of equal effect throughout the EU. Thus, the patent could be granted, transferred, declared invalid or lapse only with respect to the entire EU territorial area and not just for specific EU Member States. In 2010 the European Commission presented a Proposal for a Regulation on the translation arrangement for an EU patent, which built on the current EPC language regime, i.e. the patent is granted in one of the official languages of the EPO and includes translations of the claims into the two other languages of the EPO116. In 2008 the Slovenian Presidency of the Council of the European Union together with the French Presidency of the same Council presented a working document containing a Draft Agreement on the European Patent Court117. In 2009 the latest proposal for a unified litigation system was entitled “Draft Agreement on the European and Community Patents Court and Draft Statute” (hereinafter: for simplicity reasons the Draft Agreement)118. Particularly, this Draft Agreement was to be concluded between the EU, EU Member States and non-Member countries that were nonetheless parties to the EPC. The Draft Agreement provided for the creation of a UPLS with a specialized judiciary, the European and Community Patent Court (the “ECPC”, 114

Commission, ‘Proposal for a Council Regulation on the Community patent’ [2000] OJ C337E 278-290. See Luginbuehl (n 109 Chapter I) 256. 115 Commission, ‘Enhancing the patent system in Europe’ (Commission) COM (2007) 165 final, available at accessed 30 November 2011. See Luginbuehl (n 109 Chapter I) 262. 116 Commission, ‘Proposal for a Council Regulation (EU) on the translation arrangements for the European Union patent’ COM (2010) 350 final of 30 June 2010, available at

accessed 30 November 2011. See Luginbuehl (n 109 Chapter I) 263. 117 Draft Agreement on the European Patent Court, Document 11270/08 (PI 32) of 30 June 2008, available at accessed 30 November 2011. See Luginbuehl (n 109 Chapter I) 264. 118 Draft Agreement on the European and Community Patents Court and Draft Statute, Document 7928/09 (PI 23) of 23 March 2009, available at accessed 30 November 2011. See Luginbuehl (n 109 Chapter I) 264-265.

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the name of which was later changed to the European and European Union Patents Court, the “EEUPC”. For the present purpose only, these terms will be used interchangeably). This unitary and specialized patent judiciary would have been a new international organization with a central division and several regional and local divisions. This judiciary would have been designated by Member States as their national exclusively competent court to deal with European patents’ and future Community patents’ validity and infringement issues respectively. Particularly, the ECPC Central Division would have been competent to address the actions for revocations, i.e., the validity claims principally raised119, the validity issues incidentally raised120 and all the claims for which the local and regional divisions are competent. In contrast, ECPC regional and local divisions would have been competent to address the infringement claims and the revocation counter claims, i.e., validity issues incidentally raised, and to impose remedial measures, with jurisdiction localized in the State where the defendant is domiciled or, alternatively, in the State where the infringement occurs121. Thus, in the majority of the cases, the ECPC would have granted unitary litigation with significant positive effects, compared to the status quo of fragmented litigation122. Despite all of these efforts, significant progress has stalled in the quest to create a more harmonized and unified patent system in the European Union. As of today, neither the goal of creating an EU-wide patent right or establishing a system for unified adjudication has been achieved. With respect to a unified adjudication system, the EU Member States disagreed on whether the Draft Agreement was compatible with the EU Treaty and the FEU Treaty which entered into force on 1 December 2009123 (hereinafter: for simplicity reasons the EU Treaties). According to one view expressed by the Czech, Danish, German, Estonian, Netherlands, Polish, Portuguese, Romanian, Slovenian, Finnish, Swedish and United Kingdom Governments the Draft Agreement was compatible with the EU Treaties124. In contrast, according to 119

See para 5 for this terminology. Ibid. 121 Ibid. 122 See Luginbuehl (n 109 Chapter I) 265; Jaeger, Hilty, Drexl and Ullrich (n 112 Chapter I) 817. 123 Treaty of Lisbon, Consolidated versions of the Treaty on European Union and the Treaty on the Functioning of the European Union and the Charter of Fundamental Rights of the European Union [2007] OJ C306/1. The Treaty entered into force on 1 December 2009. 124 See C-1/09 Opinion of the Court (Full Court), 8 March 2011, para 33, available at accessed 30 November 2011. See paras 34-45 for the reasons at the basis of this view. Yet, some German scholars did argue, however, that the agreement was not sufficiently developed with respect to procedures. For example, it did not provide for common jurisdiction rules in actions against multiple defendants or for consolidation of proceedings involving coordinated infringements of European patents. See Jaeger, Hilty, Drexl and Ullrich (n 112 Chapter I) 826. 125 C-1/09 Opinion of the Court (n 124 Chapter I) para 19. See paras 20-26 for the reasons at the basis of this view. 126 Ibid para 27. See paras 28-32 for the reasons at the basis of this view. 127 See infra, para 5. 128 C-1/09 Opinion of Advocates General, 2 July 2010, para 124. Although the Opinion was presented on 2 July 2010 it was published over 6 weeks later after in French (the official language of the document) on a patent lawyer’s blog. See the English translation of this document at accessed 30 November 2011. See Alan Johnson, ‘Advocates General say preliminary ‘non’ to a panEuropean Patents Court’ (2011) 6(2) JIPLP 105-107. See also Lissén and Poza (n 109 Chapter I) 240. 129 C-1/09 Opinion of the Court (n 124 Chapter I). On this Opinion see Lissén and Poza (n 109 Chapter I) 241. 130 C-1/09 Opinion of the Court (n 124 Chapter I). Concluding remarks.

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courts. Consequently, that agreement would alter the essential character of the powers which the Treaties confer on the institutions of the European Union and on the Member States, which are considered by the ECJ as indispensable to preserve the very nature of EU law131. Yet, the ECJ’s Opinion did not answer the issue of compatibility with EU Treaties of the proposed linguistic system of the UPLS, which made it possible for a defendant to be sued in a local or regional division of the first instance Patent Court or even in the central division in a language which is completely foreign to its location or place of business, affecting the rights to a fair defence (as the Advocates General maintained)132. In addition the following can be said. To reduce the costs associated with validations of European patents in each contracting State, an agreement on the application of Article 65 EPC, the London Agreement, was adopted in OctoOctober 2000133. Under Article 1(1), (2) and (3) of the London Agreement, a State which has an official language in common with one of the official languages of the EPO shall dispense entirely with the translation requirements provided for in Article 65(1) EPC; a State party which does not have an official language in common with one of the official languages of the EPO shall dispense with the translation requirements provided for in Article 65(1) EPC if the European patent has been granted in the official language of the EPO prescribed by that State, or translated into that language and supplied under the conditions provided for in Article 65(1) EPC. These States may however require that a translation of the claims into one of their official languages be supplied134. Within the EU 17 States did not ratify the London agreement as of yet, namely Austria, Belgium, Bulgaria, Cyprus, the Czech Republic, Estonia, Finland, Greece, Hungary, Ireland, Italy, Malta, Poland, Portugal, Romania, Slovakia and Spain135. In this context, ten years after the London agreement at the end of the extraordinary Competitiveness Council on 10 November 2010 the Belgian Pres131

Ibid para 89. C-1/09 Opinion of Advocates General (n 127 Chapter I) para 123, according to which, “the language regime before the central division of the European and Community Patents Court might violate the rights of the defence (see paras 121 and 122 of this opinion)”. See Lissén and Poza (n 109 Chapter I) 241. 133 See the Agreement on the application of Article 65 of the Convention on the Grant of European Patents (adopted 17 October 2000, entered into force 1 May 2008) OJ EPO 2001 p. 550. Text available at accessed 30 November 2011. On the London Agreement see Lissén and Poza (n 109 Chapter I) 241. 134 See the EPO website at accessed 30 November 2011. 135 See the Status of accession and ratification at accessed 30 November 2011. See Lissén and Poza (n 109 Chapter I). 132

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idency, supported by the majority of delegations, concluded that insurmountable difficulties existed making a decision on the translation arrangements requiring unanimity impossible now and in the foreseeable future and that the objectives of the proposed Regulations to establish unitary patent protection in the entire European Union could not be attained within a reasonable period by applying the relevant provisions of the Treaties. This conclusion was confirmed at the Competitiveness Council meeting on 10 December 2010136. Therefore, twelve Member States addressed formal requests to the Commission indicating that they wish[ed] to establish enhanced cooperation in the area surrounding the creation of unitary patent protection and that the Commission should submit a proposal to the Council to that end137. On 16 December 2010, the Commission submitted to the Council a proposal for a Council Decision authorising enhanced cooperation in the area surrounding the creation of unitary patent protection138. Following the Commission proposal thirteen more Member States have decided to participate in the envisaged enhanced cooperation, thus bringing the total number of participating Member States to twenty-five139, with the only exceptions being Italy and Spain. On 15 February 2011, the European Parliament gave its consent to proceed with the enhanced cooperation140. On March 10, 2011, the EU Council authorized an enhanced cooperation among EU member States for the creation of a unitary patent title that would be valid in all the participating Member States141. Yet, Italy and Spain consider that the proposed enhanced cooperation is unacceptable on both procedural and substantive grounds. Those countries highlight that the procedure of enhanced cooperation is exceptional, allowing nine or more countries of the EU to move forward on an issue which is being blocked by a small number of countries: according to Article 20 of the EU Treaty, “Member States which wish to establish enhanced cooperation between themselves within the framework of the Union's non-exclusive competences may make use of its institutions and exercise those competences by applying the relevant provisions of the Treaties, subject to the limits and in accordance with the detailed arrangements laid down in this Article and in Articles 326 to 334 of the Treaty on the Functioning of the European Union. […] The decision authorising enhanced cooperation shall be adopted by the Coun136 Proposal for a Council Decision authorising enhanced cooperation in the area of the creation of unitary patent protection, Document 6524/11 (PI 10), 2 March 2011, available at accessed 30 November 2011, para 5. 137 Ibid para 6. 138 Ibid para 7. 139 Ibid para 8. 140 Ibid para 11. 141 See Council Decision of 10 March 2011 authorising enhanced cooperation in the area of the creation of unitary patent protection [2011] OJ L76/53 of 22 March 2011.

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cil as a last resort, when it has established that the objectives of such cooperation cannot be attained within a reasonable period by the Union as a whole, and provided that at least nine Member States participate in it”. In light of that, Italy and Spain issued a joint statement at the Competitiveness Council on 10 December 2010, according to which “Italy and Spain strongly believe that it is possible to achieve a consensus-based solution among the 27 Member States as we did in December 2009 on the Patent regime. Therefore, Italy and Spain are committed to evaluate, with flexibility and in a constructive spirit new solutions that will benefit the entire European Union as well as the economic operators and that are acceptable to all Member States. Italy and Spain are convinced that the Council has not exhausted all the negotiating possibilities. It is clear that inter alia the ‘last resort’ requirement for an enhanced cooperation is not fulfilled. Besides, for the sake of caution the Council should wait for the Court´s Opinion on the European Jurisdictional System of Patent since it could have a material impact on this matter. Even one of the Member States which wish to establish enhanced cooperation has pointed out this element. In this controversial context, Italy and Spain reserve their right to take any legal measure provided for in the Treaties to preserve the values and objectives of the EU as a whole”142. In addition, on 31 May, 2011 Italy and Spain lodged an appeal with the ECJ against the decision of the Council authorising the introduction of a European patent through enhanced cooperation. Despite the Italian and Spanish appeal, implementation of the Council decision authorising the enhanced cooperation requires the adoption of two regulations: one on the creation of unitary patent protection and a second on the applicable translation arrangements. On 13 April 2011 the Commission adopted the proposals for implementing the regulations143. These two legislative proposals “will radically reduce the cost of patents in Europe by up to 80%”144, namely reducing the cost for a European patent with unitary effect in 142 See the statement published by the Council of the European Union, Document 6524/11 (n 136 Chapter I) para 13. 143 Commission, ‘Proposal for a Regulation of the European Parliament and of the Council implementing enhanced cooperation in the area of the creation of unitary patent protection’ COM (2011) 215 final of 13 April 2011, available at accessed 30 November 2011. See also Commission, ‘Proposal for a Council Regulation implementing enhanced cooperation in the area of the creation of unitary patent protection with regard to the applicable translation arrangements’ COM (2011) 216 final of 13 April 2011, available at accessed 30 November 2011. 144 See Commission proposes unitary patent protection to boost research and innovation, Europa press release, IP/11/470, Brussels, 13 April 2011, available at accessed 30 November 2011. See also Commission Staff Working Paper,

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25 Member States to €680. The Commission emphasised that it hopes Spain and Italy will join the enhanced cooperation145. The draft regulations will now pass to the Council and the European Parliament for consideration. 5. Terminology: Private International Law (PIL); Brussels System; Court of Justice of the European Union (ECJ); Exclusive Jurisdiction; Intellectual Property; Traditional Knowledge (TK), Genetic Resources (GR) and Folklore (F); Intangible Cultural Heritage (ICH); Registered and Unregistered Intellectual Property Rights (IPRs); State granting an IPR; International Conventions on IP; Four Academic Sets of Principles; International Law Association Committee; the Hague Preliminary Draft; Validity Claims principally and incidentally raised; Infringement Proceedings; Duplicated Proceedings; Misappropriation and Protection; Judgments; Rendering State and Requested Country; Courts. Hereafter, for the purposes of this book only, the following simplified terminology will be adopted. The term PIL will be adopted to designate private international law lato sensu intended and thus encompassing international jurisdiction issues, choice of law rules, and recognition and enforcement of judgments matters. Hereinafter, as already mentioned the Brussels Convention and the Brussels I Regulation are jointly referred to as “the Brussels System” together with the Lugano Convention. Hereinafter, the Court of Justice of the European Union (CJEU) will be referred to as the European Court of Justice (ECJ)146. The term of exclusive jurisdiction will be adopted rather than the notions of subject matter jurisdiction or justiciability147. Intellectual property will be referred to as IP and intellectual property rights will be referred to as IPRs. Both terms, IP and IPRs, should be interpreted in conformity with the broad definition rendered by Article 2(viii) of the WIPO Convention148, according to which “‘intellectual property’ shall include the rights relating to: – literary, artistic and scientific works, – perfor‘Impact Assessment’ SEC (2011) 482 final of 13 April 2011. The Working Paper is an accompanying document to the unitary patent protection Proposal (n 143 Chapter I) and to the Proposal with regard to the applicable translation arrangements (n 143 Chapter I). The text is available at accessed 30 November 2011. 145 See Europa press release (n 144 Chapter I). 146 The Court of Justice of the European Union includes the former European Court of Justice as per Article 19 of Treaty of the European Union in OJ C83/27 on 30 March 2010. 147 See supra, para 2. 148 See Jürgen Basedow, ‘Foundations of Private International Law in Intellectual Property’ in Basedow, Kono and Metzger (n 2 Chapter I) 6.

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mances of performing artists, phonograms, and broadcasts, – inventions in all fields of human endeavour, – scientific discoveries, – industrial designs, – trademarks, service marks, and commercial names and designations, – protection against unfair competition, and all other rights resulting from intellectual activity in the industrial, scientific, literary or artistic fields”149. Yet, despite Article 2(viii) of the WIPO Convention including also protection of unfair competition in the notion of intellectual property, and despite the fact that IPRs claims are often intrinsically connected to unfair competition matters150, unfair competition will not be addressed by this book, in line with the prevailing view distinguishing the PIL issues related to IPRs claims from PIL matters concerning unfair competition151. Furthermore, this book also encompasses sui generis rights on Genetic Resources (GR), Traditional Knowledge (TK) and Folklore (F)152, albeit sui generis rights are currently only recognized at national and interregional level, not by a universal international treaty. Ongoing negotiations are taking place within different international fora, including those typically dealing with traditional IPRs, aimed at concluding an international agreement relating to a universal protection of those rights153. Thus, while it is still indeed highly questionable whether rights on TK, GR and F are (sui generis) IPRs, or whether they are only “similar” to IPRs (and IP rules only apply mutatis mutandis in that context), and it is also apparent that all arguments that apply to (sui generis) (IP) rights on TK, GR and F cannot unreservedly be transposed to patents or copyright or other traditional IPRs, this book also analyses (sui generis) (IP) rights on TK, GR and F, but only in the limited aspect of the relevance to the country of origin, in relation to the discipline for the worldwide misappropriation of those rights154. In fact, this relevance can reasonably con-

149 See Convention Establishing the World Intellectual Property Organization (signed at Stockholm 14 July 1967 and amended 28 September 1979). Text available at accessed 30 November 2011. 150 See Anderman Steven and Ezrachi Ariel (eds), Intellectual Property and Competition Law. New Frontiers (OUP 2011) 495; Josef Drexl (ed), Research Handbook on Intellectual Property and Competition Law (Edward Elgar 2008) 490; Basedow, ‘Foundations of Private International Law’ (n 148 Chapter I) 12. 151 See for instance the (EC) Regulation No 864/2007 of the European Parliament and of the Council of 11 July 2007 on the law applicable to non-contractual obligations [2007] OJ L199/40 on 31 July 2007 (Rome II Regulation). Article 6 of this Regulation determines the law applicable to unfair competition matters, whereas Article 8 of the same Regulation establishes the law applicable to IPRs infringements. On the latter Article see infra, para 56. 152 Silke Von Lewinski (ed), Indigenous Heritage and Intellectual Property. Genetic Resources, Traditional Knowledge and Folklore (2nd edn, Alphen aan den Rijn, Kluwer Law International 2008). 153 See the immediately following remarks. 154 See chapter IV.

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stitute one of the main arguments advocating support of the interpretation of the territoriality principles proposed here155. Particularly, as for the ongoing negotiations that are taking place within different international fora, related to TK, GR and F, the following can be mentioned. In the World Trade Organization (WTO) the ongoing negotiations have so far produced few results156. In contrast, WIPO Intergovernmental Committee on Intellectual Property and Genetic Resources, Traditional Knowledge and Folklore is currently working on new drafts of its three working documents on: traditional cultural expressions; traditional knowledge; and genetic resources157. These documents are due to be presented at the WIPO General Assembly Session between the 26 September and 5 October 2011158. In particular, one of the preliminary documents adopted by the Committee159 warrants full quotation. On the one hand it sets out the principle of national treatment, according to which “a host country would extend to foreign traditional knowledge holders treatment that is at least as favourable as the treatment it accords to national traditional knowledge holders in similar circumstances”160. However, on the other hand, “under one strict conception of national treatment, a foreign court in the country of protection would have recourse to its own laws, including its own customary laws, to determine whether a foreign community qualifies as a beneficiary. This may not satisfactorily address the situation from the community’s viewpoint which would, reasonably, wish for its own customary laws to be referred to. Under mutual recognition and assimilation principles, a foreign court in the country 155

See chapter IV. There is a two-way procedure: the ordinary work in the TRIPs Council on the one hand, and the special consultations carried out by the WTO Director General on the other. See ‘Intellectual property differences ‘better illuminated’ – Lamy reports’ World Trade Organization (12 March 2010) accessed 30 November 2011. 157 See Traditional Cultural Expressions/Expressions of Folklore: WIPO/GRTKF/IC/19/4; Traditional Knowledge: WIPO/GRTKF/IC/19/5; Genetic Resources: WIPO/GRTKF/IC/19/6 and WIPO/GRTKF/IC/19/7. All these documents are available at accessed 30 November 2011. 158 The Committee will ask the WIPO General Assembly for the renewal of its mandate. For further details see Benedetta Ubertazzi, ‘Report to the 19th Session of the Intergovernmental Committee on IP and Genetic Resources, Traditional Knowledge and Folklore’ available at accessed 30 November 2011. 159 WIPO/GRTKF/IC/17/5, 15 September 2010, Seventeenth Session of the Intergovernmental Committee on Intellectual Property and Genetic Resources, Traditional Knowledge and Folklore, Geneva, 6-10 December, 2010, page 82, available at accessed 30 November 2011. 160 Ibid. On the national treatment principle in IPRs cases see infra para 34. 156

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of protection could accept that a community from the country of origin of the traditional knowledge has legal standing to take actions in country A as the beneficiary of protection because it has such legal standing in the country of origin. Thus while national treatment might be appropriate as a general rule, it may be that mutual recognition, for example, would be the appropriate principle to address certain issues such as legal standing”161. Furthermore, under the framework established by the UN Convention on Biological Diversity (CBD)162, the Nagoya Protocol on Access to Genetic Resources and Fair and Equitable Sharing of Benefits Arising from their Utilization to the Convention on Biological Diversity was adopted on 29 October 2010163. In particular, this Protocol harmonises the substantive rules, as well as the conflict of law rules related to the universal protection of traditional knowledge associated with genetic resources. Article 16 of the Protocol determines that the applicable law in respect of traditional knowledge associated with genetic resources is the law of the country of origin. It stipulates that each State party shall adopt measures to provide that traditional knowledge associated with genetic resources located within its jurisdiction has been accessed in accordance with prior informed consent and on mutually agreed terms as established by the 161

Ibid. Convention on Biological Diversity (CBD) (adopted 5 June 1992, entered into force 29 December 1993). As of 10 December 2009 the Convention is binding on 193 States. Text available at accessed 30 November 2011. On this Convention see Peter-Tobias Stoll and Anja Von Hahn, ‘Indigenous Peoples, Indigenous Knowledge and Indigenous Resources in International Law’ in Von Lewinski (n 152 Chapter I) 31-34, 38; Antony Taubman and Matthias Leistner, ‘Traditional Knowledge’ in Von Lewinski (n 152 Chapter I) 162; Jeffrey McNeely, Martha Rojas and Caroline Martinet, ‘The Convention on Biological Diversity: Promise and Frustration’ (1995) 4(2) JED 33-53; Peter Yu, ‘Cultural Relics, Intellectual Property, and Intangible Heritage’ (2008) 81 TLR 439; Pedro de Miguel Asensio, ‘Transnational Contracts Concerning the Commercial Exploitation of Intangible Cultural Heritage’ in Tullio Scovazzi, Benedetta Ubertazzi and Lauso Zagato (eds), Il patrimonio culturale intangibile nelle sue diverse dimensioni (forthcoming), in the series of books of the University Bicocca, Milan with Giuffrè, para 2; Manuel Desantes, ‘Safeguarding and Protecting Eurocentric and Indigenous Heritage: No Room for Marriage’ in Scovazzi, Ubertazzi and Zagato (ibid) para 3. 163 The Protocol will enter into force 90 days after the deposit of the fiftieth instrument of ratification, acceptance, approval, or accession. As of 20 May 2011, the Protocol has been signed by 24 States. Text available at accessed 30 November 2011. On this Protocol see Elsa Tsioumani, ‘Access and Benefit Sharing – The Nagoya Protocol’ (2010) 40 Env. Pol'y & L. 288; Simon Crompton, ‘The Nagoya Protocol: ‘a disagreement reduced to writing’’ Managing Intellectual Property (2 November 2010) available at accessed 30 November 2011; Thomas Kursar, ‘What Are the Implications of the Nagoya Protocol for Research on Biodiversity?’ (2011) 61(4) BioScience 256; de Miguel Asensio, ‘Transnational Contracts’ (n 162 Chapter I) para 2. 162

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law of the country of origin. Moreover, Article 16 also requires that each State party adopts measures to address situations of non-compliance with the lex originis and cooperate with the competent authorities in the country of origin of the traditional knowledge in cases of an alleged violation of the law of that country. With regard to non-governmental organizations (NGOs), the Association for the Protection of Intellectual Property (AIPPI) established the Special Committee Q 166164 with the task of working on the topic of intellectual property and genetic resources, traditional knowledge and folklore. Under the guidance of this Committee, AIPPI adopted in Gothenburg, in 2006, ResoluResolution Q 166 on “intellectual property and genetic resources, traditional knowledge and folklore”165, with the aim of harmonising the substantive laws of the various States. Yet this Resolution does not establish international proprocedural rules nor conflict of laws norms. In contrast, the AIPPI Special Committee Q 166 in 2010 prepared a questionnaire on “the requirement of indicating in patent applications the source or country of origin of genetic resources and traditional knowledge involved in the making of the invention”166 which addressed not only the substantive law issues but also those based on PIL. Question number 8 of the questionnaire reads as follows: “is the disclosure requirement limited to biological/genetic resources or traditional knowledge of the country in question only, or is it applicable also to biological/genetic resources or traditional knowledge obtained or obtainable from other countries and geographical areas?”167 The answers to this question collected in 2010 by the AIPPI Special Committee Q 166 indicate that while certain countries (such as Brazil, South Africa and New Zealand) limit the disclosure requirement to the traditional knowledge that is present in their territory, the majority of the States involved (such as China, Egypt, Germany, Italy, The Philippines and Switzerland) extend the disclosure requirement also to non-domestic resources, respecting the law of the country of origin168. Unfortunately, according to the national groups that answered the questionnaire, there are still no administrative or judicial decisions on this disclosure requirement169. 164

See the Special Committee website at accessed 30 November 2011. 165 See the Resolution at accessed 30 November 2011. 166 See Summary report of AIPPI Special Committee Q 166, available at accessed 30 November 2011. 167 Ibid. 168 Ibid. 169 See ibid page 4, and see also the answer to Question 7 on the availability of such decisions.

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Furthermore, this book adopts a broad notion of intangible cultural heritage (hereinafter: ICH), which comprises not only the intangible cultural heritage items already inscribed or in the process of being inscribed in the UNESCO Lists under the 2003 Convention for the Safeguarding of Intangible Cultural Heritage, but also the intangible cultural expressions that are the object of the UNESCO 2005 Convention on the Protection and Promotion of the Diversity of Cultural Expressions, including F and TK, associated with GR or not170. For purposes of this book, the term “registered IPRs” refers to rights that have been registered in a State or are deemed to have been registered in a State under the terms of an international Convention, such as patents. The term “unregistered IPRs” refers to IPRs that come into being without condition of formalities, such as copyright. Additionally, the notion of registered IPRs refers to IPRs registration, which is designed as a formal condition to their registration, whereas when registration is designed as a mere advantage to the IPR owner, such as to establish prima facie evidence in court surrounding the IPR’s validity and the facts stated within the registry the corresponding rights will be included in the category of unregistered IPRs; such as hap170

UNESCO Convention for the Safeguarding of Intangible Cultural Heritage 2003 (adopted 17 October 2003, entered into force 20 April 2006). As of 16 May 2011 the Convention is binding on 135 States. Text available at accessed 30 November 2011. On this Convention see Janet Blake, Commentary on the UNESCO 2003 Convention on the Safeguarding of the Intangible Cultural Heritage (Institute of Art & Law 2006); Toshiyuki Kono, ‘UNESCO and Intangible Cultural Heritage from the Viewpoint of Sustainable Development’ in Abdulqawi Yusuf (ed), Standard-Setting in UNESCO, Volume I: Normative Action in Education, Science and Culture, Essays in Commemoration of the Sixtieth Anniversary of UNESCO (Martinus Nijhoff 2007) 237; Angélica Sola, ‘Quelques réflexions à propos de la Convention pour la sauvegarde du patrimoine culturel immatériel’ in James Nafziger and Tullio Scovazzi (eds), Le patrimoine culturel de l’humanité – The Cultural Heritage of Mankind (Martinus Nijhoff 2008) 487; Burra Srinivas, ‘The UNESCO Convention for the Safeguarding of the Intangible Cultural Heritage’ in Nafziger and Scovazzi (ibid) 529; Lauso Zagato, ‘La Convenzione sulla protezione del patrimonio culturale intangibile’ in Lauso Zagato (ed), Le identità culturali nei recenti strumenti UNESCO (CEDAM 2008) 27; Toshiyuki Kono (ed), The Impact of Uniform Laws on the Protection of Cultural Heritage and the Preservation of Cultural Heritage in the 21st Century (Martinus Nijhoff 2010); Tullio Scovazzi, ‘La Convention pour la Sauvegarde du Patrimoine Culturel Immatériel’ in Budislav Vukas and Trpimir Šoši (eds), International Law: New Actors, New Concepts – Continuing Dilemmas (Martinus Nijhoff 2010) 301; Benedetta Ubertazzi, ‘Su alcuni aspetti problematici della convenzione per la salvaguardia del patrimonio intangibile’ (2011) RDI 777-798; Desantes, ‘Safeguarding and Protecting’ (n 162 Chapter I). The UNESCO Convention on the Protection and Promotion of the Diversity of Cultural Expression 2005 (adopted 20 October 2005, entered into force 18 March 2007). As of 15 May 2011 the Convention is binding on 112 States. Text available at accessed 30 November 2011. On this Convention see Holly Aylett, ‘An international instrument for international cultural policy. The challenge of UNESCO’s Convention on the Protection and Promotion of the Diversity of Cultural Expressions’ (2010) 13 IJCS 355-373.

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pens with regard to copyright171. For trademarks, regimes are usually mixed, since in many States trademarks must be registered to be enforceable, whereas in other countries trademark rights can also arise from use172. The terminology adopted by this book with respect to registered and unregistered IPRs is confirmed also by Article 12(7) of The Hague Preliminary Draft Convention on Jurisdiction173, according to which “other registered industrial property rights [(but not copyright or neighbouring rights, even when registration or deposit is possible)] shall be treated in the same way as patents and marks”. For the purpose of this book, the State that grants a registered IPR such as a patent, the State that registers a filed IPR such as a trademark, or the State where an unregistered IPR comes into being will hereinafter be referred to as the “State of registration” or as the “granting State”. In the IP field States concluded various bilateral and multilateral treaties, rendering IP law as one of the most harmonized areas of law, although differences between the intellectual property laws of individual countries remain in areas not covered by existing treaties174. Among the important international instruments on the matter are the following. For copyright and the rights of performers, producers of phonograms, and broadcasting organizations175 (which are covered by copyright in the United States, but are protected as Neighboring Rights in some other countries176), the Berne Convention for the Protection of Literary and Artistic Works (CUB)177; the WIPO Copyright Treaty (WCT)178; the WIPO International Convention for the Protection of Performers, Producers of Phonograms and Broadcasting Organisations (Rome Neighboring Rights Convention, CR)179; the Convention for the Protection of Producers of Phonograms Against Unauthorized Duplication of Their Phonograms (Geneva Phonograms Conven171

See the ALI Principles (n 58 Chapter I). Ibid. 173 See supra, para 1. 174 Ibid. 175 See also the many other Conventions of a multilateral or a bilateral nature still binding, Italy listed in Luigi Carlo Ubertazzi (ed), Codice del diritto d’autore, in accessed 30 November 2011. 176 See the ALI Principles (n 58 Chapter I) 301. 177 The Berne Convention for the Protection of Literary and Artistic Works (adopted in 1886, amended 28 September 1979) (CUB) available at and accessed 30 November 2011. 178 Adopted on 20 December 1996 in Geneva, available at accessed 30 November 2011. 179 WIPO International Convention for the Protection of Performers, Producers of Phonograms and Broadcasting Organisations (Rome Neighboring Rights Convention, CR) (adopted 26 October 1961) available at accessed 30 November 2011. 172

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tion)180; the WIPO Performances and Phonograms Treaty (WPPT)181; the UNESCO Inter-American Conventions on Copyright, Montevideo Copyright Convention of 1889, on Literary and Artistic Property182; the UNESCO Convention for the Protection of Producers of Phonograms against Unauthorized Duplication of their Phonograms of 1971183; the UNESCO Universal Copyright Convention of 1952 as revised at Paris on 24 July 1971184; and the UNESCO International Convention for the Protection of Performers, Producers of Phonograms and Broadcasting Organizations of 1961185. For patents, the Paris Convention for the Protection of Industrial Property (CUP)186; the Patent Cooperation Treaty (PCT)187; and the EPC already referred to188. For trademarks, the CUP189; the WIPO Madrid Agreement Concerning the International Registration of Marks (Madrid Agreement)190; and the WIPO Protocol Relating to the Madrid Agreement (Madrid Protocol)191.

180 Adopted on 29 October 1971 in Geneva, available at accessed 30 November 2011. 181 WIPO Performances and Phonograms Treaty (WPPT) (adopted 20 December 1996, entered into force 20 May 2002) available at accessed 30 November 2011. 182 UNESCO Inter-American Conventions on Copyright, Montevideo Copyright Convention of 1889, on Literary and Artistic Property (adopted April 1966) available at accessed 30 November 2011. 183 UNESCO Convention for the Protection of Producers of Phonograms against Unauthorised Duplication of their Phonograms (adopted 29 October 1971, entered into force 18 April 1973) available at accessed 30 November 2011. 184 UNESCO Universal Copyright Convention of 1952 as revised at Paris on 24 July 2011 available at accessed 30 November 2011. 185 UNESCO International Convention for the Protection of Performers, Producers of Phonograms and Broadcasting Organizations (adopted 26 October 1961, entered into force 18 May 1964) available at accessed 30 November 2011. 186 Paris Convention for the Protection of Industrial Property (adopted 1883, amended 14 July 1967) (CUP) available at and at accessed 30 November 2011. 187 Patent Cooperation Treaty (adopted 19 June 1970, amended 28 September 1979, 3 February 1984, 3 October 2001, entered into force 1 April 2002) (PCT) available at and accessed 30 November 2011. 188 See the European Patent Convention (n 3 Chapter I). 189 See supra, this same paragraph.

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For design, the WIPO Hague Agreement Concerning the International Deposit of Industrial Designs of 6 November 1925192. For ICH, the UNESCO 2003 Convention for the Safeguarding of IntangiIntangible Cultural Heritage; and the UNESCO 2005 Convention on the Protection and Promotion of the Diversity of Cultural Expressions193. Additionally, various other multilateral treaties regulate geographical indications lato sensu intended, plant varieties and integrated circuits194. Among those international universal Conventions “the most important treaty” is the TRIPS Agreement195, which incorporates the CUB, CUP, CR and the WIPO Treaty on Intellectual Property in Respect of Integrated Circuits196 by reference and “contains significant additional substantive and procedural provisions with respect to all the major types of intellectual property”197. Furthermore, another plurilateral agreement concluded outside of multilateral institutions such as the WIPO and the WTO is the ACTA198. International regional organisations such as the EU (European Union)199, the Council of

190 WIPO Madrid Agreement Concerning the International Registration of Marks of 14 April 1891 (revised 14 July 1967, amended 28 September 1979) available at accessed 30 November 2011. 191 Protocol Relating to the Madrid Agreement Concerning the International Registration of Marks adopted as Madrid (adopted 27 June 1989, amended 12 November 2007) available at accessed 30 November 2011. 192 WIPO Hague Agreement Concerning the International Deposit of Industrial Designs of 6 November 1925, as revised inter alia by the Geneva Act of The Hague Agreement Concerning the International Registration of Industrial Designs adopted by the Diplomatic Conference on 2 July 1999. Text available at accessed 30 November 2011. 193 See supra this same paragraph. See ibid for the ongoing negotiations relating to Traditional Knowledge, Genetic Resources and Folklore. 194 See the references to the relevant treaties in Benedetta Ubertazzi and Esther Muñiz Espada (eds), Le indicazioni di qualità degli alimenti, Diritto internazionale ed europeo (Milan, Giuffrè 2009) 65. On the differences and similarities between geographical indications and ICH see Alberto Herrero de la Fuente, ‘La convención de la Unesco para la salvaguardia del patrimonio cultural inmaterial de 17 de octubre de 2003 y las indicaciones de calidad de los alimentos’ in Ubertazzi and Muñiz Espada (ibid) 11; Toshiyuki Kono, ‘Geographical Indication and Intangible Cultural Heritage’ in Ubertazzi and Muñiz Espada (ibid) 289. 195 See Trips Agreement (n 8 Chapter I). 196 WIPO Treaty on Intellectual Property in Respect of Integrated Circuits (adopted 26 May 1989) available at accessed 30 November 2011. 197 See the ALI Principles (n 58 Chapter I) 302. 198 See supra, para 1. 199 See the official website at accessed 30 November 2011.

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Europe200, the ARIPO (African Regional Intellectual Property Organization)201, the OAPI (Organisation Africaine de la Propriété Intellectuelle)202, the Asean (Association of Southeast Asian Nations)203 and the Comunidad Andina204 went and still are going further towards the harmonisation or even the uniformization at the regional level of the legal systems of their member States, as well as in the creation of supranational IPRs. Additionally, States have concluded and are currently negotiating treaties on a bilateral basis with the aim of going beyond the TRIPs agreement, and therefore these treaties are generally referred to as TRIPs-plus, even though they are not adopted in the framework of the WTO205. Since all treaties referred to generally adopt corresponding rules that can be relevant with respect to the exclusive jurisdiction issue - such as their norms on the principle of independence regarding each State’s domestic IPR system, as well as the principle of territoriality in enforcement of IPRs206 - for simplicity reasons this book refers only to the CUP, the CUB, and the TRIPs agreement, except where indicated differently. Yet, the reasoning adopted in relation to the rules of these three Conventions specifically referred to is extendable, mutatis mutandis, to all other corresponding treaties. The CUP, CUB, and TRIPs agreement establish the principle of the independence of each State’s domestic IPR system, as well as the principle of territoriality in the enforcement of IPRs: as both the domestic independence 200 See the official website at accessed 30 November 2011. 201 See the official website at accessed 30 November 2011. 202 See the official website at accessed 30 November 2011. 203 See the official website at accessed 30 November 2011. 204 See the official website at accessed 30 November 2011. 205 On the TRIPs-plus see Sisule Musungu and Graham Dutfield, Multilateral agreements and a TRIPs-plus world: the World Intellectual Property Organisation (Quaker United Nations Office, Geneva 2003) accessed 30 November 2011; Pedro Roffe, Bilateral agreements and a TRIPs-plus world:. The Chile-USA Free Trade Agreement (Quaker United Nations Office, Geneva 2004) accessed 30 November 2011; Daniel Gervais (ed), Intellectual Property, Trade and Development: Strategies to Optimize Economic Development in a TRIPS-Plus Era (OUP 2007). See also Gianluca Contaldi, ‘Il conflitto tra Stati Uniti e Unione europea sulla protezione delle indicazioni geografiche’ in Ubertazzi and Muñiz Espada (n 194 Chapter I) 27; Angela Lupone, ‘Il dibattito sulle indicazioni geografiche nel sistema multilaterale degli scambi: dal Doha round dell’Organizzazione Mondiale del Commercio alla protezione Trips plus’ in Ubertazzi and Muñiz Espada (n 194 Chapter I) 36; Giuseppe Coscia, ‘I rapporti fra sistemi internazionali e comunitari sulla protezione delle indicazioni di qualità’ in Ubertazzi and Muñiz Espada (n 194 Chapter I) 43. 206 See the immediately following remarks.

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principle and the territorial enforcement principle are grounded on the riality principle207. The rules of CUP, CUB and TRIPs will hereinafter be ferred to collectively as the rules on the territoriality principle. Furthermore, supranational IPRs, such as EU IPRs are also based on the international principles of territoriality albeit the significant territory is not that of one country but the whole EU208. For the purpose of this book the ALI Principles Governing Jurisdiction, Choice of Law, and Judgments in Transnational Disputes, adopted on 14 May 207 The territoriality principle implies the “independence of each country’s sovereign [...] system for adjudicating” its IPRs and does not allow any interference in the foreign country’s IPR system, as per Voda (n 31 Chapter I) 899. See also de Miguel Asensio, ‘Cross-border’ (n 6 Chapter I) 106, highlighting that “traditionally territoriality and independence of IP rights were linked to the idea that those rights could only be enforced individually in each of the jurisdictions for which protection was sought”. On the principle of territoriality: compare Paolo Auteri, Territorialità del diritto di marchio e circolazione di prodotti ‘originali’ (Milan, Giuffrè 1973); Arnulf Weigel, Gerichtsbarkeit, internationale Zuständigkeit und Territorialitäts-Prinzip im deutschen gewerblichen Rechtsschutz (Bielefeld, Gieseking 1973) 185; Joseph Straus (ed), New Technologies, Global Markets and Territoriality of Laws: a Challenge for Intellectual Property (Zurich, AIPPI 1998) 135; Nicolas Bouche, Le principe de territorialité de la propriété intellectuelle (Paris, L’Harmattan 2002). See also Luigi Carlo Ubertazzi, ‘La territorialità dei diritti del produttore fonografico, dell’artista e dell’IMAIE’ [1992] AIDA 91; Curtis Bradley, ‘Extraterritorial Application of U.S. Intellectual Property Law: Territorial Intellectual Property Rights in an Age of Globalization’ (1997) 37 Va. J. Int’l L. 505; Ludwig Baeumer, ‘Ammerkungen zum Territorialitätsprinzip im internationalen Patent- und Markenrecht’ in Bernhard Grossfeld, Rolf Sack, Thomas Möllers, Josef Drexl and Andreas Heinemann (eds), Festschrift für Wolfgang Fikentscher (Tübingen, Mohr Siebeck 1998) 803; Antoine Braun, ‘La renaissance du principe de territorialité du droit de marque dans le droit communautaire’ in Marianne Dony and Aline De Walsche, Mélanges Michel Waelbroeck (Bruxelles, Bruylant 1999) 777; Lydia Lundstedt, ‘Jurisdiction and the Principle of Territoriality in Intellectual Property Law: Has the Pendulum Swung Too Far in the Other Direction?’ (2001) 32(2) IIC 124; Graeme Dinwoodie, ‘Commitments to Territoriality in International Copyright Scholarship’ in Paul Brügger (ed) Copyright – Internet World (2003), available at

accessed 30 November 2011; Teruo Doi, ‘Territoriality Principle of Patent Protection and Conflict of Laws’ (2003) 33 Patents & Licensing 7; Graeme Dinwoodie, ‘Trademarks and Territory: Detaching Trademark Law from the Nation-State’ (2004) 41 Hous. L. Rev. 885; Josef Drexl, ‘Lex americana ante portas – Zur extraterritorialen Anwendung nationalen Urheberrechts’ in Ulrigh Loewenheim (ed), Urheberrecht im Informationszeitalter, Festschrift für Wilhelm Nordemann (München, Beck 2004) 429; James Farrand, ‘Territoriality and the Incentives under the Patent Law’ (2006) 88 J. Pat. & Trademark Off. Soc’y 761; Iris Haupt, ‘Territorialitätsprinzip im Patent- um Gebrauchsmusterrecht bei grenzüberschreitenden Fallgestaltungen’ [2007] GRUR Int 187; Susanna Leong and Cheng Saw, ‘Copyright Infringement in a Borderless World – does Territoriality Matter?’ (2007) 15 Int. J. Law & Inf. Tec. 38; Nerina Boschiero, ‘Il principio di territorialità in materia di proprietà intellettuale: conflitti di leggi e giurisdizione’ [2007] AIDA 34; Marko Schauwecker, Extraterritoriale Patentverletzungsjurisdiktion (München 2009) 9. See also chapter IV of this book. 208 See the literature referred to at the previous footnote.

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2007209, will be referred to as the ALI Principles; the “Principles for Conflict of Laws in Intellectual Property, prepared by the European Max Planck Group on Conflict of Laws in Intellectual Property (CLIP)”, published on 31 August 2011, will be referred to as the CLIP Principles210; the “Transparency of Japanese Law Project, Transparency Proposal on Jurisdiction, Choice of Law, Recognition and Enforcement of Foreign Judgments in Intellectual Property” finalised in 2009, will be referred to as the Transparency Proposal211; the “Principles of Private International Law on Intellectual Property Rights, Joint Proposal Drafted by Members of the Private International Law Association of Korea and Japan (Waseda University Global COE Project)”212, of 14 October 2010 will be referred to as the Waseda Proposal. Finally, all those four sets of academic and professional Principles will be referred to as the four sets of Principles. More recently the International Law Association instituted a Committee on “Intellectual Property and Private International Law”, which is working on

209

See the ALI Principles (n 58 Chapter I). On the ALI Principles, see Toshiyuki Kono, ‘Intellectual Property Rights, Conflict of Laws and International Jurisdiction: Applicability of ALI Principles in Japan’ (2004-5) 30 Brook. J. Int’l L. 865; Catherine Kessedjian, ‘Current International Development in Choice of Law: An Analysis of the ALI Draft’ in Jürgen Basedow, Josef Drexl, Annette Kur and Axel Metzger (eds), Intellectual Property in the Conflict of Laws (Tübingen, Mohr Siebeck 2005) 19; Axel Metzger, ‘Transfer of Rights, License Agreements, and Conflict of Laws: Remarks on the Rome Convention of 1980 and the Current ALI Draft’ in Basedow, Drexl, Kur and Metzger (n 209 Chapter I) 61; François Dessemontet, ‘Resolution Through Conflict of Laws: A European Point of View on the ALI Principles—Intellectual Property: Principles Governing Jurisdiction, Choice of Law, and Judgments in Transnational Disputes’ (2005) 30 Brook. J. Int’l L. 850; Rochelle Dreyfuss, ‘Resolution Through Conflict of Laws: The ALI Principles on Transnational Intellectual Property Disputes: Why Invite Conflicts?’ (2005) 30 Brook. J. Int’l L. 819; Frank Beckstein, ‘The American Law Institute Project on Intellectual Property: Principles Governing Jurisdiction, Choice of Law, and Judgments in Transnational Disputes. Summary of the Presentation given by Rochelle Dreyfuss’ in Leible and Ohly (n 32 Chapter I) 22; Dário Moura Vicente, ‘La propriété intellectuelle en droit international privé’ (2008) 335 Recueil Des Cours 424; Kur and Ubertazzi (n 32 Chapter I); Axel Metzger, ‘Jurisdiction in Cases Concerning Intellectual Property Infringements on the Internet, Brussels-I-Regulation, ALI-Principles and Max Planck Proposals’ in Leible and Ohly (n 32 Chapter I) 251; Dessemontet, ‘The ALI Principles’ (n 20 Chapter I) 31. 210 See CLIP Principles (n 59 Chapter I). On the CLIP Principles see Kur and Ubertazzi (n 32 Chapter I); Christian Heinze, ‘A Framework for International Enforcement of Territorial Rights: the CLIP Principles on Jurisdiction’ in Basedow, Kono and Metzger (n 2 Chapter I) 53; Pedro de Miguel Asensio, ‘Recognition and Enforcement of Judgments in Intellectual Property Litigation: The CLIP Principles’ in Basedow, Kono and Metzger (n 2 Chapter I) 239; Metzger, ‘Applicable Law Under The CLIP-Principles’ (n 2 Chapter I) 157.  211 See Transparency Proposal (n 60 Chapter I). 212 See the Waseda Proposal (n 61 Chapter I)

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the comparison of the four sets of Principles mentioned above213. For the purpose of this book the International Law Association Committee in question will be referred to as the ILA Committee. For the purpose of this book the Hague Preliminary Draft Proposal for an International Convention on Jurisdiction and Enforcement in Civil and Commercial Matters of 2001, will be referred to as The Hague Preliminary Draft on Jurisdiction. For the purpose of this book the notions of validity, validity claims, infringement and infringement claims related to IPRs are intended comprehensively as already referred to at paragraph 2 of this book. The duplication of proceedings notion adopted here is, mutatis mutandis, the same as the notion referred to by a recent study undertaken by Prof. Diemar Harhoff of the University of Munich for the European Union Commission, delivered on 26 February 2009, entitled Economic-Cost Benefit Analysis of a Unified and Integrated European Patent Litigation System214. According to this study, “duplication as referred to in this report does not require that exactly the same legal matter be brought by identical parties into different national courts. For the purpose of the [study,] we can speak of duplicated cases if the introduction of a unified Court would render one or several of the cases unnecessary, i.e. if the different national cases are substitutes in a legal and economic sense”215. A broad definition of judgment is adopted here, analogous with the one of Article 32 the Brussels I Regulation216, which stipulates that “for the purposes of this Regulation, ‘judgment’ means any judgment given by a court or tribunal of a Member State, whatever the judgment may be called, including a decree, order, decision or writ of execution, as well as the determination of costs or expenses by an officer of the court”. Furthermore, the 2010 Proposal concerning the reform of the Brussels I Regulation217 envisages moving the definition of “judgment” from Article 32 to Article 2(d) in which a clarification is added in the sense that “the term ‘judgment’ includes provisional, including protective measures ordered by a court which by virtue of this Regulation has 213 The Committee’s Chair is Professor Toshiyuki Kono, and the Committee’s CoRapporteurs are Professor Pedro de Miguel Asensio and Professor Axel Metzger. See further details of the Committee at accessed 30 November 2011. 214 Dietmar Harhoff, ‘Economic Cost-Benefit Analysis of a Unified and Integrated European Patent Litigation System’ Institute for Innovation Research, Technology Management and Entrepreneurship (29 February 2009) available at accessed 30 November 2011. On this study see Jaeger, Hilty, Drexl and Ullrich (n 112 Chapter I) 818. 215 Harhoff (n 214 Chapter I) page 15, footnote 19. 216 Brussels I Regulation (n 84 Chapter I). 217 Ibid.

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jurisdiction as to the substance of the matter”218. Additionally, in line with Article 2(d) of the proposed modification aforementioned of the Brussels I Regulation the notion of judgment adopted here includes also judicial settlements219. The State that renders a particular judgment will be referred to as the rendering State, whereas the State requested to recognize and enforce a foreign judgment is referred to as the requested State. The term “court” or “tribunal” is also to be widely understood as any authority having jurisdiction in civil matters involving IPRs. 6. Internet and Geolocation Tools This book aims to propose a thesis relevant both in the real world and on the Internet. In fact, the ubiquitous nature of the Internet does not change the problems analysed here posed by a country by country approach, but rather only offers cases that are truly global in nature, providing for a much wider number220 of potentially exclusive competent fora (and applicable laws), thereby increasing the cost and inefficiency of enforcing one’s IPRs221. In fact, it is evident that the Internet is by definition borderless and, as such, it clashes with the territorial approach that is proper in the IP field222. Yet, most of the difficulties posed by the Internet “are of a substantial law nature”223, rather than of a PIL character, and are similar to those that arose with respect to satellite broadcasting: “Where is the copy made? How relevant are the various stages of the pulling, sending and downloading of information? Where does in essence the infringement take place if what the statute describes as one act of copying or communication to the public falls apart in 218

The same broad definition of judgment is adopted by Article 23 of The Hague Preliminary Draft Convention on Jurisdiction, as well as by the four sets of Principles, of which the CLIP Principles are more explicit on the point whereas the other sets of Principles lead to the same result implicitly, as highlighted by the vew that “the basic meaning of ‘judgment’ of Article 401(1) of the Transparency Proposal is to the same effect as in the ALI Principles § 101.2, and is not substantially different from the CLIP Proposal Article 4:101”, as per Toshiyuki Kono, Nozomi Tada, and Miho Shin, ‘Recognition and Enforcement of Foreign Judgments Relating to IP Rights and Unfair Competition’ in Basedow, Kono and Metzger (n 2 Chapter I) 302, footnote 26. Finally, provisional measures do not constitute the object of this book, see infra para 12. 219 Yet, settlements do not constitute the object of this book, see infra para 12. 220 See de Miguel Asensio, ‘Cross-border’ (n 6 Chapter I) 106; Fawcett and Torremans (n 51 Chapter I) 911. 221 See also chapters IV and VI. 222 See Pedro de Miguel Asensio, Derecho Privado de Internet (4th edn, Civitas 2011) 432. See Benedetta Ubertazzi, ‘Territorial and Universal Protection of Intangible Cultural Heritage from Misappropriation’ (2010) 8 NZYIL 69. 223 Fawcett and Torremans (n 51 Chapter I) 911-912.

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several activities taking place in different jurisdictions? Copyright [substantive] law needs to define what exactly is the act of copying or communication to the public in the technological context of [the] [I]nternet”224. Additionally, the assumption that the Internet is not bound by territorial limitations has been countered by the efforts of governments, supported by private parties, which have attempted to make the territorial scope of regulation and enforcement on the Internet mirror the geographical limits of the physical world i.a through the adoption of “geolocation tools”225. It is evident that the practice of a user viewing the Internet as if he/she is located in a country other than the one where he/she is physically present, so called “cybertravel”, frustrates all those efforts as well as the effectiveness of geolocation tools226. Yet, the legal status of cybertravel is highly unclear as of yet, since neither national or international legislatures have drafted laws governing cybertravel, nor have courts been presented with cybertravel cases. On one hand, it is possible to purport that “cybertravel should be analogized to physical travel, and that the benefits that society enjoys through physical travel correspond in large measure to the benefits provided for by cybertravel. Therefore cybertravel should enjoy the constitutionally protected right to travel, and should be subject to reasonable governmental regulation, as in any other international travel”227. However, with respect to IPRs, it seems plausible that cybertravel disputes will define the next generation of transborder cases where IPRs holders will claim it is illegal to make content available to an audience that was not intended to have access to it228. In this light, the aim of this book is to propose a thesis relevant both in the real world and on the Internet. Consequently, the following remarks do not distinguish between offline and online situations, save where specific reference to the Internet is truly demanded by the specificities of the rules addressed or the cases involved.

224

Ibid. Marketa Trimble, ‘The Future of Cybertravel: Legal Implications of the Evasion of Geolocation’ (2012) 22 Ford. Intell. Prop. Media & Ent. L.J. (forthcoming). See also Alessandro Cogo, I contratti di diritto d’autore nell’era digitale (Turin, Giappichelli 2010) 6566; Paul Katzenberger, ‘Zwangsdigitalisierung uhreberrechtlich geschützter Werke in den USA und in Deutschland: das Project Google Book Search und §1371 UrhG’ [2010] GRUR Int 563. 226 On the term cybertravel see Trimble (n 225 Chapter I). See in general Eric Goldman, ‘Geolocation and A Bordered Cyberspace’ (13 November 2007) available at accessed 30 November 2011. 227 Trimble (n 225 Chapter I) conclusions. 228 Ibid. 225

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II. Theses Purporting That Comity, the Act of State Doctrine and the Territoriality Principle Establish Implicit Exclusive Jurisdiction Rules II. Theses Purporting That Comity 7. The US Court of Appeals for the Federal Circuit Voda Judgment and the UK Court of Appeal Lucasfilm Decision This book begins by analyzing the first thesis, which purports that comity and the territoriality principle establish exclusive jurisdiction in the Courts of the State that granted229 an IPR. This thesis was recently adopted, inter alia, by two important national court decisions, namely the decision of the US Court of Appeals for the Federal Circuit in Voda v Cordis Corp.230 and the UK Court of Appeal’s decision in Lucasfilm Entertainment Co. v Ainsworth231 (which was reversed by the Supreme Court’s 27 July 2011 ruling232). In Voda, the plaintiff, Voda, was a US resident, while the defendant, Cordis, was a US-based entity233. Voda owned several US, European, British, Canadian, French, and German patents related to a single invention, which Voda claimed Cordis infringed234. Cordis did not object to Voda’s claim of US patent infringement, but opposed Voda’s infringement claims concerning the European, British, Canadian, French and German patents, arguing that the court lacked subject matter jurisdiction over such claims235. The Court accepted Cordis’ argument, and thus refused to examine Voda’s foreign patent infringement claims236. In Lucasfilm, the US plaintiffs (hereinafter: the plaintiff) sued a private person and the company he had set up (hereinafter: the defendant) domiciled in the United Kingdom in a US Court, claiming that the defendant had infringed the plaintiff’s US copyrights with respect to a number of works created for the film Star Wars237. According to the plaintiff, the defendant’s infringing activity was “all actually done in or from the UK [by virtue of] […] sales to US customers in the US by dispatch of products from the UK, adver229

See supra, para 5. Voda (n 31 Chapter I). 231 Lucasfilm Entertainment (n 29 Chapter I). 232 Lucasfilm Ltd. & Ors v Ainsworth & Anor (n 30 Chapter I). For the reasons why this book examines the Court of Appeal’s Lucasfilm ruling even though it no longer constitutes authority see para 2. 233 Voda (n 31 Chapter I). For further details concerning this case see infra chapter VI, paras 90-93. 234 Voda (n 31 Chapter I) 890. 235 Voda (n 31 Chapter I) 891. 236 Voda (n 31 Chapter I) 905. 237 Lucasfilm Entertainment (n 29 Chapter I) 5. For further details concerning this case see infra chapter VI, paras 90-93. 230

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tising on the Internet and the placing of advertisements in US publications”238. The plaintiff argued that this amounted to presence of the defendant in the US for purposes of personal jurisdiction. As the defendant did not appear before the Court, the US Court rendered default judgment in favor of the plaintiff condemning the defendant for infringing the plaintiff’s US copyrights. The US plaintiff then asked a UK court to enforce its US judgment against the defendant domiciled in the United Kingdom. The UK Court of Appeal denied this enforcement request, stating that since “the mere selling of goods from country A into country B does not amount to the presence of the seller in country B”239, the defendant was not to be considered present in the United States under UK international jurisdiction rules that require a defendant’s physical presence in the forum State for the forum State’s courts to adjudicate a case against him240. Therefore, the UK Court of Appeal found that the US Court lacked personal jurisdiction to hear the case and refused to enforce the US judgment241. The US plaintiff asked the UK court to start a new proceeding on the merits to “enforce the US copyright”242 directly in the United Kingdom. The UK Court of Appeal denied this request as well, holding that foreign IPRs are not justiciable in the United Kingdom243. On appeal, however, the decision of the UK Court of Appeal was reversed by the UK Supreme Court’s 27 July 2011 ruling, which asserted the justiciability of a claim for infringement of a foreign copyright244. In both Voda and Lucasfilm, the respective US and UK Courts of Appeals reached their conclusions based i.a. on two different arguments related to comity and the territoriality principle245. The first argument was grounded on the “act of state doctrine [...] [which] requires that, in the process of deciding, the acts of foreign sovereigns taken within their own jurisdictions shall be deemed valid”246. This argument purports that the rules that govern “relations between sovereigns’”247 and that establish “comity and the principle of avoiding unreasonable interference with the authority of other sovereigns”248 limit the exercise of international jurisdiction by a State on foreign matters that are the expression of another State’s sovereignty or domestic policies. According 238

Lucasfilm Entertainment (n 29 Chapter I) 100. Ibid 192. 240 Ibid. 241 Ibid 187–194. 242 Ibid 17. 243 Ibid 194. 244 See infra, para 16. 245 See infra, chapters III and IV respectively. 246 Voda (n 31 Chapter I) 904. 247 Voda (n 31 Chapter I) 900. 248 Lucasfilm Entertainment (n 29 Chapter I) 171 (recalling the Voda judgment). On the comity reasons with respect to IPRs, see infra, chapter III. 239

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to the arguments adopted by the courts, registered and unregistered IPRs are among those matters, since such rights are an expression of the sovereignty of the States that grant or recognize them249, and constitutes an expression of such State’s local policies and interests250. As a consequence, both versions of this thesis – both the version of Voda and Lucasfilm (Court of Appeal’s ruling251) respectively – advance that Courts should decline to exercise jurisdiction over matters related to both the validity and infringement of foreign IPRs, since “a world in which states regularly claimed jurisdiction over the property rights established by other nationals would be a world in which the principle of negative comity would have largely vanished”252. Thus, both versions of this thesis posit that comity reasons implicitly establish exclusive jurisdiction in the State granting or recognizing each IPR with respect to the validity and infringement thereof. The second argument advanced in Voda and Lucasfilm (Court of Appeal’s ruling253) is grounded on the territoriality principle254. According to this argument, the CUP, the CUB and the TRIPs agreement establish the territoriality principle255, which implies the “independence of each country’s sovereign [...] system[] for adjudicating”256 its IPRs and does not allow any interference in the foreign country’s IPR system. In this light, interference purportedly occurs whenever a domestic court adjudicates a foreign IPR issue. Thus, it is argued that the territoriality principle proscribes such adjudication. The absence of an “express jurisdictional-stripping statute”257 in the CUP, CUB, and TRIPs agreements is alleged to lend further support to this position, since nothing in these treaties “contemplates or allows one jurisdiction to adjudicate [the] patents of another [country]”258. In conclusion, this argument purports that the CUP, CUB, and TRIPs agreements establish an implicit exclusive jurisdiction rule with respect to both IPR validity and infringement disputes.

249 Voda (n 31 Chapter I) 902, according to which “[i]t would be incongruent to allow the sovereign power of one to be infringed or limited by another sovereign’s extension of its jurisdiction” with respect to a foreign patent infringement claim. 250 Lucasfilm Entertainment (n 29 Chapter I) 159, 176, according to which “[i]nfringement of an IP right (especially copyright, which is largely unharmonized) is essentially a local matter involving local policies and local public interest” and “enforcement may involve a clash of the IP policies of different countries” respectively. 251 Lucasfilm Ltd. & Ors v Ainsworth & Anor (n 30 Chapter I). 252 Braithwaite and Drahos (n 41 Chapter I) 58. 253 Lucasfilm Ltd. & Ors v Ainsworth & Anor (n 30 Chapter I). 254 See chapter IV. 255 See para 5. 256 Voda (n 31 Chapter I) 899. 257 Ibid. 258 Ibid. See also Lucasfilm (n 29 Chapter I) 179–180.

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8. The ECJ GAT Decision Like the two versions of the first thesis presented, a second thesis also mainmaintains that implicit exclusive jurisdiction rules exist with respect to adjudicating certain claims related to foreign IPRs. However, this thesis differs from the previous in that, firstly, the exclusive jurisdiction rule covers only registered IPRs and does not encompass unregistered IPRs; secondly, the exclusive jurisdiction rule covers the proceedings related to the validity of the IPR but does not encompass its infringement claims259. This thesis forms the basis of Article 16(4) of the Brussels Convention, now 22(4) of the Brussels I Regulation260. According to the Jenard Report to the Brussels Convention, “[s]ince the grant of a national patent is an exercise of national sovereignty, Article 16(4) of the Judgments Convention provides for exclusive jurisdiction in proceedings concerned with the validity of patents. Other actions, including those for infringement of patents, are governed by the general rules of the Convention”261. This thesis was also adopted and developed further by the ECJ in its interpretation of the scope of Article 16(4) of the Brussels Convention (now 22(4) of the Brussels I Regulation) in two cases. In the first case, Duijnstee, Mr. Duijnstee, a liquidator in the dissolution of a company, applied to the Maastricht Arrondissementsrechtbank for an interlocutory injunction requiring Mr. Goderbauer, the former manager of the company, to transfer to Mr. Duijnstee all patents and pending patent applications in twenty-two countries for an invention that Mr. Goderbauer made while employed by the company262. The proceeding came before the Hoge Raad, which then referred the preliminary question to the ECJ of “whether the concept of proceedings ‘concerned with the registration or validity of patents’ within the meaning of Article 16(4) of the [Brussels] Convention [...] may cover a dispute such as that concerned in the main action”263 namely, a dispute having as its subject matter a transfer of IPRs. The ECJ answered that Article 16(4) does not cover such disputes264. In the second case, GAT265, one German Company (GAT) competed for a contract with Ford-Werke AG, Cologne, to supply a mechanical damper 259

Principally or incidentally raised, see supra para 5. Brussels I Regulation (n 84 Chapter I). 261 Paul Jenard, ‘Report on the Convention on jurisdiction and the enforcement of judgments in civil and commercial matters’ [1979] OJ C59/36. See also the Lugano Convention (n 69 Chapter I) and the Explanatory Report by Professor Fausto Pocar (n 108 Chapter I). In literature see Bariatti, ‘La giurisdizione’ (n 47 Chapter I) 501. 262 Duijnstee (n 51 Chapter I) para 3. On this case see Basedow, ‘Foundations of Private International Law’ (n 148 Chapter I) 23. 263 Duijnstee (n 51 Chapter I) paras 19–20. 264 Ibid para 25. 265 GAT v LuK (n 32 Chapter I) para 10. On the GAT case see supra para 1. For further details concerning this case, see also infra, chapter VI, paras 90-93. 260

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spring. Another German company (LuK) alleged out of court that GAT was in breach of, inter alia, certain French patents of which LuK was the registered proprietor266. In response GAT filed a declaratory action for non-infringement before the Landgericht Düsseldorf, asking the court to establish that GAT was not in breach of LuK’s patents, as such patents were invalid267. The Oberlandesgericht Düsseldorf stayed the proceeding and asked the ECJ if the exclusive jurisdiction of Article 16(4) of the Brussels Convention “only applies if proceedings (with erga omnes effect) are brought to declare the patent invalid or are proceedings concerned with the validity of patents within the meaning of the aforementioned provision where the defendant in a patent infringement action or the claimant in a declaratory action to establish that a patent is not infringed pleads that the patent is invalid and that there is also no patent infringement for that reason, irrespective of whether the court sei[z]ed of the proceedings considers the plea in objection to be substantiated or unsubstantiated and of when the plea in objection is raised in the course of proceedings”268. The ECJ answered that “the rule of exclusive jurisdiction laid down [by Article 16(4) of the Convention] [...] concerns all proceedings relating to the registration or validity of a patent, irrespective of whether the issue is raised by way of an action or a plea in objection”269. In both the Duijnstee and the GAT cases, the ECJ reached its conclusions on the basis of the following main arguments. First, according to the ECJ, “exclusive jurisdiction is justified by the fact that the issue of patents necessitates the involvement of the national administrative authorities”270. Here, the ECJ references the Jenard Report, according to which the granting of a patent is an “exercise of national sovereignty”271. From this statement, it is clear that the Jenard Report is grounded in the act of state doctrine. Accordingly, the ECJ decisions citing it are also based on the act of state doctrine. Furthermore, the act of state doctrine is adopted to ground the scope of the exclusive jurisdiction rule advanced by the second thesis. According to this thesis, the exclusive jurisdiction rule covers only registered IPRs and does not apply to unregistered IPRs. The reason for this distinction is that registered IPRs are granted through a public act of concession, which implies the intervention of the national administration and therefore the exercise of national sovereignty, whereas unregistered IPRs come into being without these formalities. Also, according to this thesis, exclusive jurisdiction rules cover the pro-

266

GAT v LuK (n 32 Chapter I) para 9. Ibid. 268 Ibid para 12. 269 Ibid para 31. 270 Ibid para 23. 271 Jenard (n 261 Chapter I) 36. 267

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ceedings related to the validity of IPRs272, but do not encompass related infringement claims273. Such divergent treatment is premised on the argument that proceedings concerning an IPR’s validity actually question or challenge the validity of its granting acts; whereas proceedings related to infringement concern only the activity of private subjects. Since the granting act is an act of the national administration of the granting State, this act is argued to be an expression of the State’s sovereignty, leading to the second thesis’ conclusion that validity proceedings imply an examination of the sovereign activity of foreign States. Although the ECJ has embraced the first argument of the first thesis, namely, the act of State doctrine, it has refused to adopt the second argument of the first thesis, which purports that the CUP, CUB, and TRIPs agreements implicitly establish an exclusive jurisdiction rule. To understand the ECJ’s position with regard to the CUP, CUB, and TRIPs agreements, it is relevant to briefly review the Tod’s case. In that case, “[h]aving learnt that [a French company] was offering for sale and selling under [its] name designs of shoes which copied or at least imitated the principal characteristics of the [Italian companies] Tod’s and Hogan, designs”274, Tod’s brought an action for infringement of registered designs for shoes bearing the Tod’s and Hogan trademarks in the French Court275. The French company countered with a plea of inadmissibility contending that, under the Berne Convention, Tod’s was not entitled to claim copyright protection in France for designs that did not qualify for such protection in Italy276. The French Court stayed the proceeding and asked the ECJ to establish if “Article 12 EC, which lays down the general principle of non-discrimination on grounds of nationality, means that the right of an author to claim in a Member State the copyright protection afforded by the law of that State may not be subject to a distinction based on the country of origin of the work”277. The ECJ considered that “the purpose of that convention is not to determine the applicable law on the protection of literary and artistic works, but to establish, as a general rule, a system of national treatment of the rights appertaining to such works”278. Therefore, the ECJ answered that “Article 12 EC [...] must be interpreted as meaning that the right of an author to claim in a Member State the copyright protection afforded by the law of that State may not be subject to a distinguishing criterion based on the country of 272

Principally or incidentally raised, see supra, para 5. Ibid. 274 Case C-28/04 Tod’s SpA, Tod’s France SARL v Heyraud SA [2005] ECR I-5783, para 273

7. 275

Ibid paras 1–8. Ibid para 8. 277 Ibid para 12. 278 Ibid para 32. On the national treatment principle in IPRs cases see infra para 34. 276

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origin of the work”279. The ECJ’s conclusions that the CUB does not relate to private international law and therefore does not determine any applicable laws, but instead establishes that a national treatment principle of a substantive nature, may be applied to the CUP, CUB, and TRIPs agreements and also to international procedural law. Interpreted in this way, the ECJ’s Tod’s decision determines that the territoriality principle of the CUP, CUB, and TRIPs agreements neither refers to applicable law nor posits an implicit exclusive jurisdiction rule280.

III. Exclusive Jurisdiction Rules Are Not Established Either by Comity or by the Act of State Doctrine and the Territoriality Principle, But Rather Are Contrary to the Public International Law Rules on the Right of Access to Courts III. Exclusive Jurisdiction Rules 9. The Subject Matter and the Plan of this Research: Arguments Against Comity and the Act of State Doctrine, as well as Against the Territoriality Principle. The Human Right of Access to a Court. The two theses on exclusive jurisdiction just discussed, the first in the Voda and Lucasfilm (Court of Appeal’s ruling281) cases, and the second in the ECJ judgments, are unconvincing for at least the following reasons in the context of public international law. The first argument advanced in support of these theses, based on the act of state doctrine and comity reasons, respectively, is not convincing for reasons that I will explain in detail in the third chapter of this book. The second argument advanced in support of these theses that is grounded on the territoriality principle is not convincing either, for reasons that I will address in detail in the fourth chapter of this book. The two theses of exclusive jurisdiction are also not convincing for a third reason related to public international law. That is, exclusive jurisdiction rules are contrary to the right of access to a court. This right is granted by both general international law rules and by international conventions establishing the necessity of avoiding a denial of justice, the doctrine of forum necessitatis, and the fundamental human right of access to a court. Because they are contrary to the right of access to a court, exclusive jurisdiction provisions not only are not implicitly suggested282 by public international law, but are actually

279 280

Ibid para 37. See in detail with reference to other relevant case law as well as literature, infra, para

52. 281 282

Voda (n 31 Chapter I) and Lucasfilm Entertainment (n 29 Chapter I). See infra, para 29.

III. Exclusive Jurisdiction Rules

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contrary to it. The arguments in favour of this conclusion are the subject matter of the sixth chapter of this book283. 10. Arguments Against the Other Rationales in Support of Exclusive Jurisdiction Rules: Foreign Immovable Property, Local Actions, Article 22(1) of the Brussels System and the Moçambique Rule; Double Actionability Rule; the Sound Administration of Justice and the Judicial Economy; the Best Placed Courts; the Difficulties of Applying Foreign Laws; Non-Recognition and NonEnforcement of Judgments on Foreign IPRs; the Amendment of Registers; Forum Non Conveniens The two theses in favour of exclusive jurisdiction rules, the first in Voda and Lucasfilm (Court of Appeal’s ruling284), and the second in the ECJ judgments, are also grounded on rationales other than comity, the act of state doctrine and the territoriality principle. According to a first rationale exclusive jurisdiction rules derive from the Moçambique rule. A second rationale bases exclusive jurisdiction rules on the double actionability rule. A third rationale of exclusive jurisdiction rules is based on the fact that they would promote the sound administration of justice and judicial economy. According to a fourth rationale exclusive jurisdiction rules determine the best placed courts to adjudicate IP disputes. A fifth rationale grounds exclusive jurisdiction rules on the need to avoid the application of foreign laws by the forum State court, since the difficulties of applying foreign IP laws are too great. A sixth rationale bases exclusive jurisdiction rules on the allegedly existent impossibility to recognize and enforce judgments on foreign IPRs in their respective countries of registration. According to a seventh rationale exclusive jurisdiction rules are grounded on the fact that IPRs are registered in public registries, and since the foreign judgments have as their object the validity or legality of entries in these public registers, they cannot be recognised in the country where the register is kept. An eighth rationale bases exclusive jurisdiction rules on the application of the forum non conveniens doctrine to IPRs cross-border litigation. Yet, each of these rationales is not convincing for reasons that I will explain in detail in the fifth chapter of this book.

283

This book adheres to the prevailing opinion that not only physical persons but also corporations are entitled to at least certain fundamental human rights, including the right of access to courts. See Rainier Arnold, ‘Are Human Rights Universal and Binding? Limits of Universalism’ (July 2010) in The XVIIIth International Congress of Comparative Law (forthcoming). See also recently Citizens United v Federal Election Commission, 130 S. Ct. 876 (2010), recognizing that corporations have free-speech protections. 284 Voda (n 31 Chapter I) and Lucasfilm Entertainment (n 29 Chapter I).

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11. Conclusions. Exclusive Jurisdiction Rules shall be Abandoned in Benefit not only to IPRs Owners, but also to those with the Potential to Infringe IPRs: Referral As a conclusion, this book adopts and develops a thesis according to which exclusive jurisdiction rules in IPRs cases are not suggested285 by public international law; are actually contrary to its rules on the denial of justice and on the fundamental human right of access to a court; and therefore must be abandoned. This conclusion concerns unregistered IPRs claims of whatever nature as the absolute majority of national legal systems establish and the four sets of Principles state286. The same conclusion concerns also registered IPRs infringement issues and validity claims raised as a defense in infringements proceedings, as the majority of the scholars maintain287 and the four sets of Principles establish288. It also includes IPRs validity claims principally raised, as recently maintained by few scholars289 and achieved partially under the ALI Principles and entirely by the Transparency Proposal290. Finally, the abandonment of exclusive jurisdiction rules would favour not only the IPRs owners but also those with the potential to infringe IPRs, as will be highlighted at para 98. 12. Delimitation of this Research: Overprotection of IPRs; Contracts; General Jurisdiction; Infringement Jurisdiction; Jurisdiction for Provisional Measures; Prorogation of Jurisdiction; Objective or Subjective Consolidation of Claims; Lis Pendens; Arbitrability and Judicial Settlements; Allocation of Jurisdiction in Purely Domestic Cases. This book does not enter into the debate of whether protecting IPRs is a “fundamental good”291; whether the world is in a phase of overprotection of IP or of IPRs expansionism; whether the protection of IP is desirable at all; or what the appropriate level of such protection might be292 especially in light of the 285

See infra, para 29. See infra, para 16. 287 The majority of the doctrine is against exclusive jurisdiction rules in relation to IPRs infringement proceedings and validity issues incidentally raised. See the doctrine that severely criticizes the ECJ GAT decision indicated supra (n 6 Chapter I). See also infra, paras 18, 20 and 21. 288 See infra, paras 18, 20 and 21. 289 See infra, para 23. 290 See Chapter II. 291 Jonathan Barnett, ‘Is Intellectual Property Trivial?’ (2009) 157 U. Pa. L. Rev. 1696. 292 On this debate see Ricolfi, ‘Is There an Antitrust Antidote’ (n 8 Chapter I) 305; Robert Merges, Justifying Intellectual Property (Harvard University Press 2011). For further references to US literature as well as to European ones see Andrea Ottolia, The Public Interest and Intellectual Property Models (Turin, Giappichelli 2010) 1, footnotes 1 and 2. Finally, see the Washington Declaration on Intellectual Property and the Public Interest (25-27 August 2011), 286

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need to balance the fundamental human right to IP293 with other fundamental human rights294. Rather, this book adopts the approach that “as long as laws exist to protect intellectual property rights, those laws should be enforceable, regardless of the geographical location of the infringers of the rights”295. This book does not examine PIL issues related either to the contractual circulation of IPR, defined also as “secondary” IPRs law296, or to ownership and entitlement of IPRs297. Rather, this book concentrates on the “primary” or “proprietary” issues related to IPRs, which comprise matters of validity298 and infringement299 thereof, with most exclusive jurisdiction rules relating to the latter. Additionally, this book does not examine in detail the other possible jurisdiction rules that apply to the IPRs matters, namely: the rules related to jurisdiction at the defendant’s domicile or residence (so-called general jurisdiction); the jurisdiction at the place of the infringement (so-called special jurisdiction); the jurisdiction for provisional measures; the prorogation of jurisdiction; or the objective or subjective consolidation of claims300. However, the exclusive jurisdiction rules play an important role with regard to these other jurisdiction rules. So, for example as far as the consolida-

released by a group of over 170 policymakers and advocates from approximately 35 countries that met at American University Washington College of Law. The Declaration is available at accessed 30 November 2011. 293 On the characterisation of IPRs as fundamental human rights see infra, para. 34. 294 On the balance between IPRs and other fundamental human rights see ibid and also inter alia ECJ, Case C-275/06 Promusicae v Telefónica de España SAU [2008] ECR I-271, paras 65 and 68. 295 Trimble Landova, ‘When Foreigners Infringe Patents’ (n 1 Chapter I) 500. 296 On the EU jurisdictional and applicable law issues related to the contractual circulation of IPRs, see the ECJ decision of 23 April 2009, Case C-533/07 Falco Privatstiftung and Thomas Rabitsch v Gisela Weller-Lindhorst [2009] ECR I-03327. In literature see also Pedro de Miguel Asensio, ‘Nota a Falco’ [2009] ready to be published in REDI; Benedetta Ubertazzi, ‘Licence Agreements related to IP rights and the EC Regulation on jurisdiction’ (2009) 40 IIC 912; Nerina Boschiero, ‘I contratti relativi alla proprietà intellettuale alla luce della nuova disciplina comunitaria di conflitto. Analisi critica e comparatistica’, in Nerina Boschiero (ed), La nuova disciplina comunitaria della legge applicabile ai contratti (Roma I) (Turin, Giappichelli 2009) 520; Eva De Götzen, ‘La licenza d’uso di diritti di proprietà intellettuale nel regolamento Bruxelles I: il caso Falco’ [2010] RDIPP 383; Pietro Franzina, ‘Struttura e funzionamento del foro europeo della materia contrattuale alla luce delle sentenze Car Trim e Wood Floor’ [2010] RDIPP 656. 297 See supra, para 5. 298 Ibid. 299 Ibid. 300 On those rules see Fawcett and Torremans (n 51 Chapter I).

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tion of claims rules are concerned301, States can condition the consolidation of the different claims in issue not only on the fact that a close connection exists between them302, but also on the fact that no exclusive jurisdiction rule exists that excludes the court’s competence to address foreign IPRs claims303. In other words, the requested court consolidates the claims in issue only if they concern national IPRs, since the court considers itself without jurisdiction to deal with the proceeding related to foreign IPRs owing to exclusive jurisdiction rules. Similarly, with regard to provisional measures304, States can condition the adoption of preliminary injunctions in IPR cases not only on the fact that “the party against whom they are directed ha[d] been summoned to appear”305, but also on the fact that no exclusive jurisdiction rule exists that ex301

On the consolidation of claims issue see also infra, para 20. However, see infra, para 34, on the difficulties with respect to the consolidation of claims related to the entry into force of the new US Patent Act. 302 Ibid. 303 Ibid. 304 Preliminary injunctions are very popular in intellectual property proceedings. Generally, injunctions to prevent the infringement are not ex parte, but it might be that they are ordered without giving notice to the defendant. Additionally, most orders granted by courts to authorize the searching for evidence of the alleged infringement are ex parte measures. See Christian Heinze, Einstweiliger Rechtsschutz im europäschen Immaterialgüterrecht (Tübingen, Mohr Siebeck 2008); Costanza Honorati, ‘La cross-border prohibitory injunction olandese in materia di contraffazione di brevetti: sulla legittimitá dell’inibitoria transfrontaliera alla luce della Convenzione di Bruxelles del 1968’ [1997] RDIPP 301. On the issue of the possible characterisation of evidence taking as preliminary measures for international jurisdiction purposes see ECJ, Case C-175/06 Alessandro Tedesco v Tomasoni Fittings Srl and RWO Marine Equipment Ltd [2007] ECR I-07929. Note this case was ultimately settled by an agreement between the parties and therefore was not decided by the ECJ. See also the opinion of Advocate General Kokott of 18 July 2007 in Case C-175/06 Tedesco published in The European Legal Forum (2008) 1-42. In literature see Benedetta Ubertazzi, ‘The EC Council Regulation on evidence and the “description" of goods infringing IP rights’ [2008] The European Legal Forum I-80; Luigi Fumagalli, ‘Il caso “Tedesco”: un rinvio pregiudiziale relativamente al Regolamento n. 1206/2001’, in Stefania Bariatti and Gabriella Venturini (eds) Liber Fausto Pocar. Nuovi strumenti del diritto internazionale privato (Giuffrè 2009) 22, 391; Christian Heinze, ‘Beweissicherung im europäischen Zivilprozessrecht’ [2008] IPRax 480; Burkhard Hess, ‘Preservation and Taking of Evidence in Cross-Border Proceedings- Comparative Remarks in the Context of IP Litigation’ in Nuyts (ed), ‘International Litigation’ (n 32 Chapter I) 298. 305 Case 125/79 Denilauer v SNC Couchet Frères [1980] ECR 1553, para 20. Indeed, the prevailing opinion highlights the need to adopt a more liberal approach to the rule established in the Denilauer judgment, particularly after the adoption of the EU so-called Enforcement Directive (Council Directive 2004/48/EC of the European Parliament and of the Council of 29 April 2004 on the Enforcement of Intellectual Property Rights [2004] OJ L157/45) and its impact on the Brussels I Regulation. See ‘Recognition and Enforcement of Judgments in Intellectual Property Matters’, 2 October 2006, at accessed 30 November 2011, p. 5; Nerina Boschiero, ‘Beni immateriali (diritto internazionale privato e processuale)’ Enciclopedia del diritto and available at accessed 30 November 2011, particularly at page 73 emphasising the impact of the Enforcement Directive on the Brussels I Regulation in relation to the need to recognise and enforce provisory measures ordered in the IP field; at page 74 in favour of a limited adoption of the public policy exception in IP issues. Finally, see Joaquim-Joan Forner Delaygua, ‘The Impact of the Enforcement Directive on the Brussels I Regime’ in Nuyts, ‘International Litigation’ (n 32 Chapter I) 257-288. 306 Trimble Landova, ‘When Foreigners Infringe Patents’ (n 1 Chapter I) 506-507. 307 See the District Court of The Hague in Solvay S.A v Honeywell Fluorine Products Europe B.V., Case No. 09-2275 (15 September 2010), available at accessed 30 November 2011 (in Dutch). On the competence of the courts other than the courts of the States that granted the IPR at hand to render provisional injunctions also when the validity of the litigious IPR is disputed, see the recent decision of the District Court of The Hague in Fort Vale/Pelican, Case No. 07-2964 (18 June 2008), according to which the ECJ GAT decision does not preclude this result. See also para 20. 308 See Court of Appeal of The Hague in Yellow Page Marketing Ltd. v Yell Ltd. LJN BR1364 (12 July 2011). Direct link: accessed 30 November 2011. This judgment was kindly provided and translated partially into English by Justice Schaafsma.

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same place309, but rather according to the so-called ubiquity theory310, which determines two alternative places where jurisdiction could be grounded, namely the place where the infringing acts took place or the place where the results of the infringement occurred311. This new understanding of the infringement jurisdiction rules supports the approach proposed in chapter IV which holds that the territoriality principle does not ground exclusive jurisdiction rules312. The following remarks will therefore also refer to the jurisdiction rules other than the ones posing exclusive jurisdiction inasmuch as those rules are relevant to the thesis here proposed. This book does not examine whether IPRs validity and infringement issues or the provisional injunctions related to the IPRs matters can be arbitrated or can constitute the object of judicial settlements, notwithstanding the fact that the submission of these issues to arbitration tribunals and to judicial settlements in courts other than those of the States that granted the IPR at hand derogates from at least the Brussels system’s exclusive jurisdiction of the courts of the State granting or recognizing the IPR313. In fact, “the world of arbitration requires case to case tailored solutions rather than general rules applicable independently of the common intention of the parties”314. The same can be said, mutatis mutandis, with regard to settlements. Finally, the here-purported thesis relates to international jurisdiction and does not concern the allocation of jurisdiction within a country.

309

See infra, para 62. Ibid. 311 See infra chapter IV of this book. 312 Ibid. 313 On the arbitrability of IPRs validity (inter partes) and infringement issues see Section II, case 11(4), of each national report on Jurisdiction and Applicable Law in Matters of Intellectual Property (n 27 Chapter I). See also Luigi Mansani, ‘Arbitrabilità e privative comunitarie titolate’ [2006] AIDA 21; Fumagalli, ‘Il caso “Tedesco” (n 304 Chapter I) 150; Giovanni Guglielmetti, ‘Arbitrato e diritti titolati’ [2006] AIDA 12; Luca Radicati di Brozolo, ‘Arbitrato e norme imperative: oltre l’arbitrabilità’ [2006] AIDA 111; Bonomi Andrea, ‘Il diritto applicabile nel merito degli arbitrati internazionali in materia di proprietà intellettuale’ [2006] AIDA 117; Moura Vicente (n 209 Chapter I) 428. 314 Dessemontet, ‘The ALI Principles’ (n 20 Chapter I) 44. 310

Chapter II

Comparison. Exclusive Jurisdiction Rules do not Express a Customary International Law Rule. The New Trend to Abandon them. I. Aims, Delimitation and Terminology of the Comparison I. Aims, Delimitation and Terminology of the Comparison 13. First Aim: Exclusive Jurisdiction Rules are not Expressions of a Customary International Law Rule The first aim of this comparison is to determine whether exclusive jurisdiction rules are an expression of customary international law, because if exclusive jurisdiction rules qualify as an expression of a customary international law rule, this would require all States that are part of the international community to abstain from the adjudication of foreign IPRs claims. The main characters of customary public international law rules are wellknown and include the following. Article 38(1) of the Statute of the International Court of Justice (hereinafter: ICJ), often referred to as a catalogue of the sources of international law, establishes in its entirety that “1. The Court, whose function is to decide in accordance with international law such disputes as are submitted to it, shall apply: a). international conventions, whether general or particular, establishing rules expressly recognized by the contesting states; b). international custom, as evidence of a general practice accepted as law; c). the general principles of law recognized by civilized nations; d). subject to the provisions of Article 59, judicial decisions and the teachings of the most highly qualified publicists of the various nations, as subsidiary means for the determination of rules of law”. Article 38 of the ICJ Statute therefore includes customary public international law rules among the sources of public international law, emphasising that there are two elements which must be present to determine the existence of a customary international law rule. The first is an objective factor and looks at the repeated behaviour of States (diuturnitas) to determine whether the behaviours of the different States of the international community express a practice that is concordant, commune and constant, and thus univocal and repeti-

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tive1. The second is subjective and is grounded in the States’ opinio juris ac necessitatis2, looking to whether the States are acting on a belief that such behaviour is required by international law3. The notion of States’ practice is broad and includes what the States “do and say, what they want (or consent to), and what they believe”4, as evidenced by their actions both as singular actors and as part of a group (e.g., within in the frame of an international organisation). It also takes into account, actions by non-State actors, such as Non-Governmental Organizations and scholarly groups. The actions of such groups often influence governments’ perceptions of their international duties and ultimately their opinio juris and therefore can provide indirect evidence of the elements used to assess the existence of customary international rules as well as the relevance of the various elements of the practice subject to international law5. The general practices of the States that is relevant for establishing the existence of a customary international rule do not necessarily have to include all States or even be completely uniform. Rather the general practice must include the practice “of States whose interests are specially affected”6 as well as of “States representing the main legal, economic, and political orientations and geographical areas”7. Thus, “for a rule to be established as customary, the corresponding practice must [not] be in absolutely rigorous conformity with

1 The Asylum Case (Columbia v Peru) [1950] ICJ Rep 266; ILR 280, decided by the International Court of Justice, was one of the first ICJ cases in which the basic rule of continuity and repetition was established. 2 The term was first coined by the French writer François Gény to distinguish legal custom from ordinary social activities. See the references in Malcolm Shaw, International Law (5th edn, Cambridge University Press 2003) page 71 footnote 15. 3 See Tullio Treves, ‘Customary International Law’ in Rüdiger Wolfrum (ed), Max Planck Encyclopedia of Public International Law (OUP 2008) para 8. The Permanent Court of International Justice (PCIJ) and the ICJ have constantly stated that a customary rule requires the presence of those two elements. See the 1927 PCIJ case of the Lotus (France v Turkey) (Merits) [1927] PCIJ Rep Series A No 10. On this case see infra para 42. See ICJ North Sea Continental Shelf Cases (Federal Republic of Germany/Denmark; Federal Republic of Germany/Netherlands) (Merits) [1969] ICJ Rep 3 para. 77. Similarly, ICJ Military and Paramilitary Activities in and against Nicaragua Case (Nicaragua v United States of America) (Merits) [1986] ICJ Rep 14 para 207. See also Delimitation of the Maritime Boundary in the Gulf of Maine Area (Canada/United States of America) (Merits) [1984] ICJ Rep 246 para 111. On the voluntary or involuntary character of customary international law, as well as on the nonentirely consistent nature of the jurisprudence on this point see Treves, ‘Customary International Law’ (n 3 Chapter II) paras 9 and 18. 4 Treves, ‘Customary International Law’ (n 3 Chapter II) para 10. 5 Ibid. 6 North Sea Continental Shelf Cases (n 3 Chapter II) p. 74. 7 Treves, ‘Customary International Law’ (n 3 Chapter II) para 35.

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the rule”8, but rather “consistency with the rule in general is sufficient, if conduct inconsistent with it is treated as a breach and not as an indication of a new rule and invoking exceptions or justifications for conduct that appears inconsistent with the rule, independently of their well-foundedness, ‘confirm[s] rather than weaken[s] the rule’ (ibid)”9. The determination of the existence of customary international rules requires knowledge of the manifestations of international practice and are obtained through the following: bilateral and international treaties; printed collections of States’ practice published by scholarly institutions in the systematic form of digests or of yearly reviews; some collections of diplomatic papers; the judgments of international courts and tribunals as well as the written and oral pleadings presented to those courts; and documents of international organizations published and made available to States, such as publications by the UN and other international organizations of the documents concerning the process of codification of international law, including studies of practice prepared in connection with the process and views of States obtained on the various drafts10. Subparagraph (b) Article 38 of the Statute of the ICJ stipulates that it shall apply “international custom, as evidence of a general practice accepted as law”. As a general principle customary international law rules are binding on all members of the international community, even the States that did not previously follow the given practice, and Article 38(b) also clarifies that the expression “general international law” can be used synonymously with “customary international law”11. Article 38(1) ICJ Statute lists the different sources of public international law, but notes that “the order mentioned simply represent[s] the logical order 8

Nicaragua Case (n 3 Chapter II) para 186. Originally, in the Anglo-Norwegian Fisheries Case [1951] ICJ Rep paras 116, 131 and 138; 18 ILR 86 the ICJ emphasised that some degree of uniformity would be necessary among state practice to bring a custom into existence. The ICJ then explained in the North Sea Continental Shelf Cases (n 3 Chapter II) p. 29, that the state practice in question must be ‘both extensive and virtually uniform’. 9 Treves, ‘Customary International Law’ (n 3 Chapter II) para 37, referring to the ICJ Nicaragua judgment already referred to. See ibid with regard to the different and specific case of the persistent objector. 10 See Treves, ‘Customary International Law’ (n 3 Chapter II) para 77. These collections of States’ practice have been criticised for giving an unbalanced view, particularly where they relate to the practice of the main powers. Yet, it is “stressed that the main powers engage in relations with most other States, so that the practice of almost all States is, at least in part, reflected in these collections”. See Treves, (ibid) para 78. 11 Ricardo Monaco, ‘Sources of International Law’ in Rudolf Bernhardt (ed), Max Planck Encyclopedia of Public International Law (Amsterdam, North-Holland Elsevier 2003) paras 469-470, according to whom “given” the two elements, objective and subjective, “the binding character of international custom needs no further basis”. See also Treves, ‘Customary International Law’ (n 3 Chapter II) para 40.

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in which these sources would occur to the mind of the judge”12. Therefore, in the mutual relationship among the categories of rules, the well known criteria of speciality applies13, particularly bearing in mind that “a general principle could also affect the way in which a certain treaty rule is to be applied” and “could impinge on the application of the treaty rule under limited aspects” so that “the principle prevails”14 over the treaty. The same conclusion can be reached with regard to the prevalence of a general principle of law over customary law. To determine whether exclusive jurisdiction rules are an expression of a customary international law rule, the following shall be ascertained through a comparative analysis. First, it must be determined whether the States’ exclusive jurisdiction rules express a practice that is concordant, commune and constant, thus univocal and repetitive, and is furthermore grounded in the States’ opinio juris ac necessitatis. Second, it must verify whether the exclusive jurisdiction rules are present in the generality of the States “whose interests are specially affected”, as well as those “States representing the main legal, economic, and political orientations and geographical areas”. If a general practice is found, it will then look to whether conduct that is inconsistent with this general practice is treated as a breach, and whether when exceptions or justifications are found they confirm rather than weaken the rule, as this would strengthen the argument that exclusive jurisdiction rules constitute customary public international law. Third, in conformity with the broad notion of States’ practice, the comparison shall examine the case-law and statutory exclusive jurisdiction rules currently present in the national legal systems of the States; the Brussels system; the Hague Preliminary Draft Convention on Jurisdiction15 and the four sets of Principles16. Fourth, the sources adopted by this comparison as evidence of States’ practice include the following: the documents concerning the process of codification of The Hague Convention on Jurisdiction17, including studies of practice prepared in connection with this process and views of States obtained on the various drafts; the official comments to the four sets of Principles18; the National Reports on Jurisdiction and Applicable Law in Matters of Intellectual Property to the 18th Congress

12 PCIJ, Advisory Committee of Jurists, ‘Procès-verbaux of the Proceedings of the Committee, June 16th–July 24th 1920, with Annexes’ 333, referred to by Giorgio Gaja, General Principles of Law in Wolfrum (n Chapter II ) para 23. 13 See Treves, ‘Customary International Law’ (n 3 Chapter II) paras 87–89; Gaja (n 12 Chapter II) para 22. 14 Gaja (n 12 Chapter II) para 22. 15 See supra, para 5. 16 Ibid. 17 Ibid. 18 Ibid.

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on Comparative Law, held in Washington in July 201019; and the prevalent scholars’ writings published in languages accessible to me. This comparative analysis indicates that exclusive jurisdiction rules are not an expression of a customary international law rule. With regard to pure infringement and validity claims of unregistered IPRs, however raised, as well as to pure infringement claims and validity claims of registered IPRs, incidentally raised, the comparison demonstrates the following. First, huge disparities exist between the different systems examined. Accordingly, exclusive jurisdiction rules do not express a practice that is concordant, commune and constant, and thus univocal and repetitive. Additionally, the States’ practice indicates that their actions are not grounded on opinio juris ac necessitatis, or a sense of legal duty, but rather are justified on questionable political and opportunistic grounds. Second, the comparison indicates that conduct inconsistent with exclusive jurisdiction rules, i.e., States’ practice favourable to the adjudication of foreign IPRs, is not treated as a breach of the eventually existing customary international law rule on exclusive jurisdiction rules in the field and does not invoke exceptions or justifications. Accordingly, such conduct fails to confirm, and actually excludes, exclusive jurisdiction rules as an expression of a customary international law rule. With regard to the limited effects of the rulings on registered IPRs validity claims incidentally raised the comparison demonstrates the following. First, the different systems examined limit the effects of the corresponding ruling to the parties of the proceeding. Accordingly, this limitation of effects expresses a practice that is concordant, commune and constant, thus univocal and repetitive. However, an analysis of the systems determines that this limitation does not stem from the States’ opinio juris ac necessitatis, but rather is based on questionable political and opportunistic grounds. Thus, the subjective elements required for finding a customary international law rule are lacking. With regard to registered IPRs validity claims principally raised the comparison indicates the following. First, the absolute majority of the different systems examined follow exclusive jurisdiction rules, either expressly or de facto, and therefore their actions express a practice that is concordant, commune and constant, thus univocal and repetitive. However, upon further analysis, the comparison highlights once again that those rules are not grounded in the States’ opinio juris ac necessitatis but, rather on questionable political and opportunistic justifications. Accordingly the subjective element of the customary international law rules is absent. Similarly, the comparison indicates that conduct inconsistent with exclusive jurisdiction rules, i.e., States’ practice favourable to the adjudication of foreign IPRs, is not treated as a breach of customary international law on exclusive jurisdiction, and these courts do not invoke exceptions or justifications when exercising such jurisdiction. Thus, 19

See Kono and Jurys (n 27 Chapter I).

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such conduct does not confirm and actually excludes that exclusive jurisdiction rules express a customary international law rule. This statement is in line with the uncontroversial thesis regarding international jurisdiction rules related to the absolute rights concerning immovable objects. According to this thesis, even though certain domestic or conventional norms of a soft law or a hard law nature allocate international jurisdiction exclusively to the courts of the State where the immovable object is located, those norms are not the expression of a rule of customary public international law20. More importantly, even if in arguendo, exclusive jurisdiction rules are to be considered the expression of a rule of customary public international law, this rule is overridden from a hierarchical perspective by another rule of general public international law: the general principle of international and EU law of forum necessitatis, and of the fundamental human right of access to courts. This argument will be fully examined in Chapter VI of this book. 14. Second Aim: Existing Trend in Favour of the Abandoning of Exclusive Jurisdiction Rules The second aim of this comparison is to verify whether a trend exists that suggests abandoning exclusive jurisdiction rules in favour of the cross-border enforcement of IPRs claims, which would constitute a strong argument in support of the thesis here proposed. This comparison will examine States’ practice to determine whether such a trend exists, using the same broad understanding of state practice and sources of knowledge previously applied to determine whether exclusive jurisdiction constituted a customary public international law rule21. Such a comparative analysis highlights that this trend exists, not only in relation to unregistered IPRs claims infringement and validity issues, however raised, and registered IPRs infringement and validity issues, incidentally raised, but also with regard to registered IPRs validity issues principally raised22. Current expressions of this trend include rulings related to overcoming exclusive jurisdiction in IPRs cross-border litigation, which will be examined in details by the following remarks. The same existence of the trend in question is recognized also by the very recent UK Supreme Court’s Lucasfilm ruling of July 2011, which held that “there is no doubt that the modern trend is in favour of the enforcement of foreign intellectual property rights”23. Particularly, the Supreme Court refers to as an expression of the same trend the 20

Gian Luigi Tosato, La giurisdizione italiana nel processo volontario (Milan, Giuffrè 1971) 19. 21 See supra, the previous two paragraphs. 22 See para 5. 23 Lucasfilm Ltd. & Ors v Ainsworth & Anor (n 30 Chapter I) 108.

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recent Regulation (EC) No 864/2007 of the European Parliament and of the Council on the law applicable to non-contractual obligations (Rome II)24. While this Regulation relates to applicable law rather than to international jurisdiction, and therefore will not be addressed in detail25, it is relevant because it “plainly envisages the litigation of foreign intellectual property rights” and thus the cross-border enforcement of IPRs claims26. 15. Delimitation, Plan and Terminology of the Comparison This comparison does not examine all the systems of the world not only because this would be practically impossible, but more importantly, because uniformity is not required for the finding of customary public international law. Rather, as previously discussed, customary international law is determined based on the practices “of States whose interests are specially affected”, as well as the “States representing the main legal, economic, and political orientations and geographical areas”. Thus, it is not the aim of this comparison to give an exhaustive analysis of all exclusive jurisdiction rules existent in the entire world, but rather to highlight that there are States that do not follow exclusive jurisdiction rules for foreign IPRs claims, and that there are other States that follow those rules on political grounds rather than out of a sense of legal obligation. Therefore both the objective and the subjective elements of the customary public international law rules are absent. Additionally, it is practically impossible to examine all the systems of the world, inter alia since the relevant legal material is published in languages other than English, Italian, German, French, Spanish and Portuguese, and thus is inaccessible to the writer of this book. As for the plan of the comparison, it is in line with the thesis here proposed that exclusive jurisdiction rules should be abandoned or overcome, and will proceed in the following order. It starts with the systems where exclusive jurisdiction rules are absent, moves to the legal orders where exclusive jurisdiction rules are limitedly present, and ends with an analysis of the systems where exclusive jurisdiction rules are dominant. Second, following the order of the thesis here proposed, the comparative remarks will start with matters that generally do not fall within the scope of the exclusive jurisdiction rules, move to the issues that are limitedly encompassed by certain exclusive jurisdiction rules, and end with an analysis of the claims that generally fall under exclusive jurisdiction rules. Finally, the comparison follows an order that reflects the source of law hierarchy that is proper to the majority of continental European countries, namely: universal international legal rules; regional in24

On this Regulation see supra, para 5 and infra para 56. See infra, para 17. 26 As per Lucasfilm Ltd. & Ors v Ainsworth & Anor (n 30 Chapter I) 109. 25

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ternational norms of an EU and EFTA origin; national statutory and case-law rules; and, finally, the soft-law international norms provided for by the most recent academic codification initiatives. As for the terminology of the comparison, as previously referred to27 the relevant exclusive jurisdiction rules compared by the following remarks determine differently the validity matters that fall under their scope; how closely the procedural action should be concerned with validity before the exclusive jurisdiction clause applies; the effects of the judgments on foreign registered IPRs validity issues, incidentally or principally raised; and when the validity issues shall be considered as incidentally raised. Yet, since the different language of these rules might in practice very rarely lead to different results, as will be addressed in detail by the comparison, for simplicity reasons the following remarks will adopt the terms validity claims or validity proceedings, inter partes effects and validity issues incidentally raised comprehensively intended, save where specified differently28.

II. The Almost Universal Absence of Exclusive Jurisdiction Rules for Unregistered IPRs both with Respect to Infringement Issues and Validity Claims, whether Principally or Incidentally Raised II. The Almost Universal Absence of Exclusive Jurisdiction Rules 16. The Almost Universal Absence of Exclusive Jurisdiction Rules in International Instruments, as well as in EU and EFTA Norms, in National Statutory or Case-Law Rules and in the Most Recent Academic Initiatives Principles With respect to international rules, there are no multilateral international conventions of either a universal or a regional character which establish any exclusive jurisdiction rules for unregistered IPRs. For example, the exclusive jurisdiction rules of the Brussels system (Article 16(4) of the Brussels Convention, now Article 22(4) of the Brussels I Regulation and Article 22(4) of the Lugano Convention29) do not cover unregistered IPRs claims of whatever nature. Furthermore, during negotiations of The Hague Preliminary Draft Convention on Jurisdiction30 in February 2001 a special meeting of experts from different negotiating countries was held. Despite the fact that an expert from the UK indicated that his country had no experience with trying to distinguish between registered and unregistered IPRs31, “the Chair summed up the discussion by noting that none of the experts had supported exclusive jurisdic27

See para 5 and the following remarks. Ibid. 29 Brussels I Regulation (n 84 Chapter I) and Lugano Convention (n 69 Chapter I). 30 See supra, para 1. 31 On the UK system see infra, this para. 28

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tion for copyrights, whether registered or not”32. The non-extension of exclusive jurisdiction rules to unregistered IPRs is codified today in the Convention on Choice of Court Agreements, which was concluded by States on June the 30th 2005 following the failure of The Hague Draft Convention. Article 10 of the 2005 Convention stipulates that “in the case of a ruling on the validity of an intellectual property right other than copyright or a related right, recognition or enforcement of a judgment may be refused or postponed under” certain conditions. In other words this norm excludes “copyright or a related right” from the scope of the existent national exclusive jurisdiction rules. As for EU and EFTA norms, there is no rule that establishes exclusive jurisdiction rule for unregistered IPRs, with respect to either infringement issues or validity claims, since, as just mentioned, the exclusive jurisdiction rules of the Brussels system do not cover those claims. As for national statutes and case-law rules, since Article 22(4) of the Brussels system does not extend its exclusive jurisdiction rule to unregistered IPRs claims, in the frame of the EU/EFTA systems Member States shall not apply exclusive jurisdiction rules with respect to those claims. Particularly, in the UK this conclusion was supported by the recent Supreme Court’s Lucasfilm judgment33, which ruled in favour of the justiciability of a claim for infringement of a foreign copyright in the UK, thereby confirming the approach of Pearce34. In the Pearce case, which related to a claim of infringement of English and Dutch copyrights, the UK Court of Appeal held that the claim for infringement of the Dutch copyright was justiciable because the Court had personal jurisdiction over the defendants by virtue of their domicile in England35, and the exclusive jurisdiction rule of the Brussels system was not applicable. Both the Supreme Court’s Lucasfilm ruling and the Court of Appeal’s Pearce judgment concern only copyright infringement cases, but do not expressly extend to cases where validity issues are incidentally raised, despite the fact that the validity of the foreign IPRs alleged to have been infringed are frequently at issue in unregistered IPRs cross-border litigation. The reasoning in the Lucasfilm and Pearce judgments did not reach the question of whether it would be sufficient for a defendant to resist the exercise of jurisdiction simply by raising an issue of validity of the foreign IPRs involved, but a teleological and ab inconvenienti interpretation of those judgments suggests their rulings extends also to cases where the validity of the foreign IPR alleged to have been 32

Permanent Bureau (n 14 Chapter I) 7. Lucasfilm Ltd. & Ors v Ainsworth & Anor (n 30 Chapter I). 34 Pearce v Ove Arup Partnership Ltd [2000] Ch 403. See the comment to this case in International Review of Intellectual Property and Competition Law (1999) 30(7) 825-840. See also Austin, ‘The Concept of "Justiciability"’ (n 29 Chapter I) 399. 35 The defendants were additional parties for the purposes of what is now Article 6(1) of the Brussels I Regulation. 33

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infringed is at issue. Otherwise, “if issues of validity too readily deflect the exercise of jurisdiction, the new jurisdictional flexibility which the English Court[s] […] appeared to be endorsing in [Lucasfilm and] Pearce may be rendered ineffective, a result that seems inconsistent with their Lordships' apparent intentions”36. EU/EFTA Member States do not generally include unregistered IPRs claims under their jurisdiction rules even outside the Brussels system. This result was also reached in the UK by the recent Supreme Court ruling in the Lucasfilm case. Also, other European continental countries that are not members of the EU allow the cross-border enforcement of foreign unregistered IPRs claims. For instance, in Croatia, courts have jurisdiction over claims involving foreign unregistered IPRs, however raised37. There are also non-European countries, which allow the cross-border enforcement of foreign unregistered IPRs in their courts. In New Zealand, the High Court of New Zealand followed the authority of the UK Pearce ruling in its ruling in the case KK Sony Computer Entertainment v Van Veen38, thereby reversing the former authority of the case Atkinson Footwear39. The KK Sony Computer case established that New Zealand courts can exercise jurisdiction over claims for the infringement of foreign copyright, at least where the defendant is served within the jurisdiction and where the existence and validity of the foreign copyright is undisputed40. In the US, there are several cases in which the courts refused to dismiss the foreign copyright claim for lack of jurisdiction41. It has not yet been decided in Canada whether its courts will have jurisdiction over claims involving the validity or infringement of foreign unregistered IPRs42. It is likely that the Canadian Courts will take into consideration decisions of courts in the British Commonwealth on this matter, like the Lucasfilm Supreme Court’s 27 July 2011 decision, given that Canadian private 36 Graeme Austin, ‘Copyright Infringement in New Zealand Law’ (2000) 19 NZULR 6, emphasis added. 37 See Kunda (n 27 Chapter I) answers to HC 2. 38 (2006) 71 IPR 179. On this case see the comment posted on Andrew Brown Queen’s Counsel website at accessed 30 November 2011. See also James McComish, ‘The Mozambique Rule and IP Rights in New Zealand’ Conflictoflaws.net (11 May 2007) accessed 30 November 2011. 39 New Zealand High Court, Atkinson Footwear Ltd. v Hodgskin International Services Ltd. and Another (1994) 31 IPR 186 HC at 190. On this case see Austin, ‘Copyright Infringement’ (n 36 Chapter II) 19. See also Fawcett and Torremans (n 51 Chapter I) 300. 40 See however supra, this para, with respect to the possible extension of the Lucasfilm ruling to validity issues incidentally raised. 41 See in detail infra, paras 32 and 76. 42 See Blom (n 27 Chapter I) subsection II(A).

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tional law is largely based on English law43. Additionally, Canadian Courts and the country’s leading private international scholarship have also shown a tendency to adopt a more functional approach to issues, when it would “facilitate the flow of wealth”44. As such, it is possible that Canadian courts will assert international jurisdiction over infringement or validity of foreign unregistered IPRs when the action has a real and substantial connection with Canada45. In Australia, the ruling in Potter v Broken46 was the first case to extend the Moçambique rule, which relates to local land actions, to actions for infringement of patents and used this rule to exclude jurisdiction of Australian Courts over foreign IPRs infringement claims47. A more recent case involving the Potter holding is Norbert Steinhardt and Son Ltd v Meth and Another48 in which the High Court of Australia reserved the Moçambique rule and the Potter case for further consideration49. With particular regard to copyright, the case of TS Production v Drew Pictures50 is related to a copyright infringement claim in a film entitled "The Secret". In this case, the Full Bench of the Federal Court of Australia considered the Moçambique rule and Finkelstein J confirmed its extension to the claims at stake, while at the same time acknowledged that “in Pearce v Ove Arup Partnership Ltd the Court of Appeal drew a distinction between actions involving the title to intellectual property and infringement actions, holding that the Moçambique rule only applied to the former”. In this context, the Australian literature concludes that “Australian case law offers increasing support for common law courts to exercise subject matter jurisdiction over infringement of foreign intellectual property rights. The last barrier to this is the Moçambique rule which, if it remains applicable at all following Pfeiffer and Zhang, will be further considered by the High Court of Australia at some time in the future”51. Furthermore, the same literature strongly criticises the Moçambique rule52. In addition, the Australian state of New South Wales has repealed the application of the Moçambique rule53. 43

Ibid. Ibid. 45 See Kono and Jurys (n 27 Chapter I). 46 High Court of Australia, Potter v Broken Hill Pty Co Ltd [1905] VLR 612, affd (1906) 3 CLR 479. See Austin, ‘The Concept of “Justiciability”’ (n 29 Chapter I) 395. 47 See para 67. 48 Norbert Steinhardt and Son Ltd v Meth and Another (1961) 105 CLR 440. 49 See Fawcett and Torremans (n 51 Chapter I) 299 and for further references. 50 (2008) 252 ALR 1, available at accessed 30 November 2011. 51 Fawcett and Torremans (n 51 Chapter I) 299 and their further references. See also Rotstein (n 1 Chapter I) 4. 52 See Richard Baddeley, ‘Out of Africa: The Moçambique Rule and Obstacles to Suits for Enforcement of Foreign Registered Intellectual Property Rights in Australia’ (June 2007) The 44

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Asian States, including China, Taiwan, Korea and Japan, do not establish any exclusive jurisdiction rules with respect to unregistered IPRs claims. In China, Part Four of the Civil Procedure Law of the People’s Republic of China (hereinafter: CPL) promulgated on 4 April 1991 and entitled “Special Provisions of Civil Procedures for Cases Involving Foreign Elements”, includes exclusive jurisdiction rules that expressly preclude foreign courts from exercising jurisdiction over certain types of civil actions which are reserved for courts in the People’s Republic of China (hereinafter PRC)54. For example, Article 246 of the CPL explicitly provides that the PRC courts shall have exclusive jurisdiction over disputes concerning the performance of contracts of Chinese-foreign equity joint ventures within China, Chinese-foreign contractual joint ventures, and Chinese-foreign cooperative exploration and development of natural resources55. Additionally, in accordance with Article 34 of the CPL, Chinese courts shall have exclusive jurisdiction with regard to disputes over real estate located in China; disputes involving harbour operations situated in China; and succession when the decedent was domiciled in China upon his death, or when the major estate is located in China56. Yet, there is no exclusive jurisdiction provision regarding IPRs claims in general, or specifically concerning foreign unregistered IPRs disputes of whatever nature57. Thus, the Chinese Supreme Court issued an “Interpretation of Several Questions on the Application of Law in on-line Copyright Disputes Litigation”, which was published in 2000 and amended in 2006, which established that “on-line copyright infringement disputes should be heard by the People’s Court where the defendant domiciles or where the infringing activities occur. The place of infringement includes the place where the ISP, computer terminals which operate the alleged infringing activity are located. In the cases where the place of infringement and the defendant’s domicile cannot be ascertained, the place where the computer terminal through which the plaintiff found infringing contents locates are deemed the place of infringement”58. This interpretation was confirmed on 22 November 2000 by the Supreme Intellectual Property Forum (Journal of the Intellectual Property Society of Australia and New Zealand) 45. See also Rotstein (n 1 Chapter I) 4 and infra, para 67. 53 See Rotstein (n 1 Chapter I) 4. 54 See Mo Zhang, ‘International Civil Litigation in China: A Practical Analysis of the Chinese Judicial System’ (2002) 25 B.C. Int'l & Comp. L. Rev. 59, 71, available at accessed 30 November 2011. 55 Ibid. 56 Ibid. 57 Ibid. 58 Article 1 of the said Interpretation. The translation of this text into English was kindly provided for me by Dr. Ning Zhao. The text is available in Chinese at accessed 30 November 2011.

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Court in the “Interpretation on Matters Concerning Application of Law in the Trial of Cases Involving Computer Network Copyright”59. In Taiwan although there are no exclusive jurisdiction rules with respect to either registered or unregistered foreign IPRs and Taiwanese law does not provide a clear-cut answer for whether its courts would be competent to decide issues of validity of a foreign unregistered IP right, Article 24 of the proposed Draft Amendment to Applicable Law for International Civil Disputes of Taiwan provides that the national courts can decide the validity of unregistered foreign IPRs, regardless of how the validity issue is raised even though the judgment on the validity issue shall have legal effects only between the parties of the claim. Furthermore, the literature reaches the same conclusions60. In Japan, not only does the new Act on International Jurisdiction61 establish that exclusive jurisdiction rules do not cover unregistered IPRs62, but the Tokyo District Court maintained in the “Coral Sand judgment”63 that when the international jurisdiction of a Japanese court is based on the defendant’s domicile in Japan, the court has jurisdiction with respect to the infringement and validity of foreign IPRs, whether registered or unregistered. The Court reasoned that neither the territoriality principle nor the fact that IPRs are linked to the national economic policies of their granting countries bars courts from adjudicating such cases, since both the territoriality principle and the relationship of IPRs with the national economic policies of their granting States 59

Zhang (n 54 Chapter II) 69. See Rong-chwan Chen, ‘Judicial Practice and Legislative Development of Taiwan’s Private International Law of Intellectual Property Rights’ in Symeonides (ed), Recent Private International Law Codifications (forthcoming, Martinus Nijhoff 2012) Para IV.B. 61 See Japan’s New Act on International Jurisdiction, Act for the Partial Amendment of the Code of Civil Procedure and the Civil Interim Relief Act (adopted 28 April 2011). This Act will enter into force one year after its promulgation. On this Act see Koji Takahashi, ‘Japan’s New Act on International Jurisdiction’, available at accessed 30 November 2011; Masato Dogauchi, ‘Forthcoming Rules on International Jurisdiction’ (2010) 12 Japanese Yearbook of Private International Law 212-241. On the previous draft see Yuko Nishitani, ‘Intellectual Property in Japanese Private International Law’ (2005) 48 JYIL 94. 62 See Article 3-5, para 3, of Japan’s New Act (n 61 Chapter II) on exclusive jurisdiction. See the annotation to Article 3-5(3), according to which “this paragraph does not cover an action for damages for infringement of an intellectual property”. See Takahashi (n 61 Chapter II). See also Chaen, Kono and Yokomizo (n 51 Chapter I) 98. 63 Tokyo District Court, Judgment of 16 October 2003, Hanrei Jih, No. 1874, p. 23, of which an abbreviated English translation is available at accessed 30 November 2011. English text can be found in The Japanese Annual of International Law (2003) 46 168. For other relevant Japanese judgments see Kono and Jurys (n 27 Chapter I); Yokomizo (n 27 Chapter I). See also Chaen, Kono and Yokomizo (n 51 Chapter I). 60

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are matters of substantive law. However, the Tokyo District Court made clear that decisions on validity on a foreign IPRs would have only an inter partes effect64. As for the most recent academic codification initiatives, the four sets of Principles reject any exclusive jurisdiction rules with respect to infringement or validity claims against unregistered IPRs, however raised65. Thus, Section 211(1) of the ALI Principles states that a court is competent to adjudicate claims and defences arising under foreign laws pertaining to copyrights, neighbouring rights, patents, trademarks, trade secrets, related IP rights and contracts that are related to any of these rights. Section 212(1) further provides that a court may determine all claims and defences of the parties that arise out of the same transaction or occurrence, or series of transactions or occurrences, regardless of the territorial source of the rights at issue, provided that the court has subject matter jurisdiction under its local law and personal jurisdiction as provided by the Principles. Similarly, no exclusive jurisdiction rule is established by the CLIP Principles with respect to infringement or validity claims involving unregistered IPRs. Also, no exclusive jurisdiction rule is established by the Japanese Transparency Proposal with respect to claims related to (registered as well as) unregistered IPRs, of whatever nature. With respect to validity claims, the Waseda Proposal is not so clear: Article 209 grounds exclusive jurisdiction for “any dispute arising out of acquiring, registering, disclaiming or revoking and validity of intellectual property rights”. Thus, this Article does not seem to distinguish between registered or unregistered IPRs. Yet, the title of the Article refers to “exclusive international jurisdiction over disputes arising out of registration and validity of registered intellectual property rights” and as such clarifies that the exclusive jurisdiction rule encompasses only registered IPRs. Also, the Waseda Proposal does not include infringement claims related to foreign unregistered IPRs in Article 209 and as such clarifies that these claims are not governed by any exclusive jurisdiction rule. Additionally, except for the Transparency Proposal, the other three sets of Principles do not establish any limitation of the competent court’s authority with regard to unregistered IPRs claims, of whatever nature. The Transparency Proposal, however, limits the effect of a judgment on validity of a foreign unregistered IPRs, by stipulating that “Judgments invalidating intellectual property rights prescribed under foreign law shall only be effective as between the parties to the action” (Article 103(3)).

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See Kono and Jurys (n 27 Chapter I); Yokomizo (n 27 Chapter I). See Chaen, Kono and Yokomizo (n 51 Chapter I) 80 according to whom “for actions concerning copyrights that do not require registration to be established, academic opinion is virtually unanimous that there is no country with exclusive jurisdiction”. 65

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17. The Very Limited Presence of Exclusive Jurisdiction Rules in South Africa and in India There are only a few countries that adopt exclusive jurisdiction rules of a statutory or a case law nature for unregistered IPRs with respect to infringement issues or validity claims. Among those countries stands South Africa where the Gallo ruling recently excluded the national justiciability of claims for infringement of foreign copyrights66. Yet, the ruling adopted the Lucasfilm Court of Appeal judgment as an authority, which was recently reversed by the UK Supreme Court67. Exclusive jurisdiction rules with respect to unregistered IPRs claims are also adopted in India, where courts can adjudicate claims related only to Indian IPRs68.

III. The Almost Universal Absence of Exclusive Jurisdiction rules For Registered IPRs Pure Infringement Claims, however Raised III. The Almost Universal Absence of Exclusive Jurisdiction Rules 18. The Almost Universal Absence of Exclusive Jurisdiction Rules in International Instruments, as well as in EU and EFTA Norms, in National Statutory or Case-Law Rules and in the Most Recent Academic Initiatives Principles As for international rules, no multilateral international convention of either a universal or regional character establishes any exclusive jurisdiction rule for registered IPRs pure infringement claims. In fact, the exclusive jurisdiction rules of the Brussels system do not cover registered IPRs pure infringement claims69. Additionally, the proposed inclusion of exclusive jurisdiction rules with respect to infringement issues in The Hague Preliminary Draft Convention on Jurisdiction was one of the principal reasons for its failure70. In fact, assuming IPRs should have fallen within the scope of the Hague Convention, two alternative provisions were proposed, of which Alternative A granted exclusive jurisdiction for pure infringement proceedings to the State of registra66

On this case see paras 1 and 2. Ibid. 68 Singh (n 27 Chapter I) answers to case no. 2. 69 See infra, this para. 70 “The negotiations to adopt the Hague Judgments Convention partly failed due to the disagreements on various aspects of jurisdiction in IP matters. Nevertheless, the outcomes of the discussions during the negotiations had threefold effect. Firstly, the importance of matters related to jurisdiction in IP cases was acknowledged as playing an important role in the area of international commercial litigation. Secondly, main problems related IP litigation according to different legal systems were crystallized. Finally, the Hague Judgments project facilitated further research initiatives on the subject around the globe”. See Kono and Jurys (n 27 Chapter I). 67

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tion and Alternative B excluded the registered IPRs infringement claims from the scope of the exclusive jurisdiction rule. Despite the limited scope of the exclusive jurisdiction rules at least under Alternative B, the issue of exclusive jurisdiction was extensively debated during the Hague Draft Convention negotiations71. During the special meeting of experts from different negotiating countries in February 2001, many differences between the approaches adopted in separate legal systems were examined. Particularly, the US delegation opposed the need for an exclusive jurisdiction rule in general, pointing out the “almost uniform opposition in the private sector to the current text as it applies to intellectual property rights; and [the] great difficulty in understanding the structure of the draft convention text”72. More specifically, “the US could not accept (in personam) jurisdiction in infringement on IP rights cases over a defendant who had no relation with the jurisdiction”73, and also “raised questions about the need for exclusivity” highlighting that “some of the US private sector comments clearly oppose exclusive jurisdiction”74. The delegations of UK, Australia and China supported the view that exclusive jurisdiction should apply to the infringement of the patent. A number of other delegations, including Switzerland, Finland and Sweden, supported a more flexible view, according to which first, “insofar as patent [infringement] disputes [are] arbitrable, it seem[s] inconsistent to confer exclusive jurisdiction for such disputes upon State courts”; second, “co-ordination between the proceedings on validity and on infringement could be ensured by other ways than by providing that the court of the place of registration of the IP right has exclusive jurisdiction to hear all matters related to this right (validity issues as well as infringement issues), for instance, by a suspension of proceedings by the court seized with the infringement claim, pending a decision on the validity by the court of the place of registration of the IP right”75. However, the German and UK delegations pointed out that proceeding in this way could lead to a multiplication of litigation, especially when the patent at stake was a European patent and thus the national bundle of rights would require the parties to bring validity proceedings in each of the countries concerned76. As for EU and EFTA norms, there is no rule establishing exclusive jurisdiction rules for registered IPRs pure infringement issues, since, as just mentioned the exclusive jurisdiction rules of the Brussels system do not cover those claims77. Therefore, those issues should fall under the defendant’s dom71

Permanent Bureau (n 14 Chapter I). Ibid 3. 73 Ibid 4. 74 Ibid. 75 Ibid. 76 Ibid. 77 See supra para 8. 72

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icile rule of Article 2 or the infringement jurisdiction rule of Article 5(3) of the Brussels system. Yet, certain EU/EFTA Member States adopted the view that negative declarations of non-infringement do not fall under the infringement jurisdiction rule of Article 5(3) of the Brussels System78. This approach was adopted by the Italian Supreme Court in BL Macchine Automatiche in 200379; the Brussels Court of Appeal in 200080; by the Swedish Supreme Court in a Lugano Convention context in Flotek AB case in 200081. Moreover, certain EU Member States have adopted the approach that positive declarations of infringement also fail to fall within Article 5(3) of the Brussels System. This approach was adopted in two Italian lower Courts’ decisions which extended the exclusive jurisdiction rules of the Brussels system to pure infringement proceedings, maintaining that “even in the absence of a validity issue, a proceeding on the infringement as well as on the noninfringement of an IPR always requires, as an essential and implicit assumption, a preliminary evaluation of the scope of the patent. It follows, then, the exclusive jurisdiction ex Article 22(4) of the (EC) Regulation 44/2001 of the court of the State that granted the patent (or the portion of the European patent)”82. The same approach was followed by the UK Court of Appeal in Lucasfilm, according to which Article 22(4) Brussels I Regulation applies to copyright infringement proceedings and thereby precludes the application of Article 5(3) and Article 2 of the same Regulation83. As for declaratory actions of non-infringement, the German Bundesgerichtshof recently requested the ECJ to give a preliminary ruling on this 78 Article 5(3) establishes that “A person domiciled in a Member State may, in another Member State, be sued 3. in matters relating to tort, delict or quasi-delict, in the courts for the place where the harmful event occurred or may occur“. On this rule see infra, para 62. 79 Cass. 19.12.2003 n. 19550, BL Macchine Automatiche ApA v Windmoller & Holscher KG in [2005] GRUR Int 264, annotated by Wolfgang Wurmnest. See also Cass. s.u. 3657/89, in Foro it. [1990], I, 117, Corte di Appello di Milano 02.03.2004, in GADI [2004] n. 4719 p. 837; Trib. Milano 10.01.2009, in GADI [2009] n. 5395 p. 637. See Trib. Milano 06.08.2008, in Diritto d’autore [2009] n. 2 p. 332; Trib. Milano 29.03.2005, in AIDA [2005] 640; Trib. Roma ordinanza 01.02.2000, in AIDA [2000] p. 870; Trib. Brescia 11.11.1999, in GADI [2000] n. 4107 p. 505. On those cases see Boschiero and Ubertazzi (n 27 Chapter I). See also Fawcett and Torremans (n 51 Chapter I) 211. 80 Court of Appeal of Brussels 20.02.2000; Trib. Brussels 12.05.2000; Trib. Brussels 08.06.2000. See Fawcett and Torremans (n 51 Chapter I) 211. 81 Swedish Supreme Court, Flotek AB case, 14.06.2000, in [2001] GRUR Int 178. See case comment by Lydia Lundstedt in [2001] GRUR Int 103. See also Fawcett and Torremans (n 51 Chapter I) 211. 82 Trib. Venezia 16.04.2011, unpublished; See also Trib. Milano 60696/07 29.11.2007, unpublished. On these cases see Boschiero and Ubertazzi (n 27 Chapter I). 83 Article 2 of the Brussels I Regulation (n 84 Chapter I) establishes that subject to this Regulation, persons domiciled in a Member State shall, whatever their nationality, be sued in the courts of that Member State. On this rule see infra, para 62 and also supra, paras 1 and 2.

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issue with regards to an antitrust case84. The ECJ has not given an answer as of yet. In any case, it is important to note that the aforementioned decisions establishing that declaratory actions of non-infringement do not fall under Article 5(3) of the Brussels system reach their conclusions not because these actions fall under the exclusive jurisdiction rules, but rather because the object of these actions would be different from those for infringement with respect to jurisdiction85. This approach can be explained by EU-specific litigation strategies based on forum shopping that were developed and abused by alleged infringers of registered IPRs in the last decade of the twentieth century. These alleged infringers would launch proceedings seeking declarations of noninfringement in courts in the past known for lengthy proceedings (e.g., Italian courts) or courts willing to hear claims involving enforcement of foreign IPRs (e.g., Belgian courts). By doing so, these alleged infringers took advantage of the lis pendens rule established by Article 27 of the Brussels I Regulation, which requires all later seized courts to stay proceedings if the same case between the parties was pending in a court in another country and ultimately decline jurisdiction if the first seized court asserted jurisdiction over the dispute. In practice, this prevented the rights holder, i.e. the defendant in the declaratory action, from enforcing his IPRs until the first court finished its proceeding. Thus, to reduce the effectiveness of those so-called “torpedoes”86 a number of measures have been adopted, including the approach followed by the Italian Supreme Court in the BL Macchine Automatiche, which regarded the object of proceedings for a negative declaration of non-infringement as being different from those for infringement. This meant that an Italian court would not consider itself as blocked by the lis pendens provisions in the Brussels system from adjudicating an infringement claim in Italy by an earlier legal action for non-infringement brought in another member State87. In any case, this approach was extensively criticised in literature for the same reasons that suggest not extending the exclusive jurisdiction to pure infringement proceedings of a positive nature, which will be examined by the following remarks88. The approach at stake is also to be criticised because to disallow claims for negative declaratory actions being brought at the place where the harmful event occurs creates systematic inconsistency insofar as in the context of contractual

84

C-133/11, Reference for a preliminary ruling from the Bundesgerichtshof (Germany) lodged on 18 March 2011 - Folien Fischer AG and Fofitec AG v RITRAMA SpA. 85 Boschiero and Ubertazzi (n 27 Chapter I). See also Fawcett and Torremans (n 51 Chapter I) 211. 86 Mario Franzosi, ‘World-Wide Patent Litigation and the Italian Torpedoes’ (1997) 19 EIPR 382; Mario Franzosi, ‘Torpedoes are Here to Stay’ (2002) 31 IIC 156; Fawcett and Torremans (n 51 Chapter I) 211. 87 Fawcett and Torremans (n 51 Chapter I) 211. 88 See supra.

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relations, corresponding actions can be brought under Article 5.1 of the Brussels I Regulation. As for the positive infringement claims, the UK Court of Appeal’s Lucasfilm ruling was reversed by the Supreme Court’s 27 July 2011 ruling, which instead confirmed the Pearce judgment89 and maintained that Article 22(4) of the Brussels I Regulation “only assigns exclusive jurisdiction to the country where the right originates in cases which are concerned with registration or validity of rights which are ‘required to be deposited or registered’ and does not apply to infringement actions in which there is no issue as to validity”90. With respect to positive infringement claims, many reasons militate against the few decisions that extend the exclusive jurisdiction rules of the Brussels system to pure infringement proceedings. Firstly, the literal interpretation of the exclusive jurisdiction rules of the Brussels system emphasises that those rules do not refer to infringement claims and thus do not apply to them. Secondly, this result is confirmed by the Jenard Report to the Brussels Convention, as well as by the Pocar Report to the Lugano Convention, according to which infringement claims do not enter into the exclusive jurisdiction rules of the Brussels system91. Thirdly, the same result is confirmed by a systematic interpretation of the EU Brussels I Regulation and the Rome II Regulation92, since Article 8 of the latter on “infringement of intellectual property rights”93 determines the possibility of applying a foreign law to IPRs infringement claims, namely the lex loci protectionis, and as such “plainly envisages the litigation of foreign intellectual property rights” infringements94. Fourthly, it is widely acknowledged that the extension of exclusive jurisdiction rules to IPRs pure infringement claims is “doubtless wrong”95. Fifthly, this result is confirmed also by the comments to the CLIP Principles referring to the nonextension of the Brussels system exclusive jurisdiction rules to IPRs infringement claims96.

89

See previous para. Lucasfilm Ltd. & Ors v Ainsworth & Anor (n 30 Chapter I) 109. 91 See supra, para 8. 92 Rome II Regulation (n 151 Chapter I). 93 According to which “1. The law applicable to a non-contractual obligation arising from an infringement of an intellectual property right shall be the law of the country for which protection is claimed. 2. In the case of a non-contractual obligation arising from an infringement of a unitary Community intellectual property right, the law applicable shall, for any question that is not governed by the relevant Community instrument, be the law of the country in which the act of infringement was committed”. On this rule see infra para 56. 94 Lucasfilm Ltd. & Ors v Ainsworth & Anor (n 30 Chapter I) 109. 95 Fawcett and Torremans (n 51 Chapter I) 211. 96 De Miguel Asensio, ‘Recognition and Enforcement’ (n 210 Chapter I) 276. 90

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In the EU frame, with regard to claims related to infringement actions or actions for declaration of non-infringement of the Community trademarks97, Articles 92–94 of the Community Trademark Regulation pose “exclusive jurisdiction” rules98. However, those norms do not ground the international jurisdiction of a single exclusively competent court, but rather establish a plurality of equally competent tribunals, namely: the (trademark) courts of the EU Member State chosen by the parties according to the Brussels Convention (now Brussels I Regulation); the EU Member State where the defendant is domiciled or has an establishment; the EU Member State where the plaintiff is domiciled or has an establishment; the seat of the Office of Harmonization for the Internal Market (OHIM); or the State where the infringement has been committed or threatened (with the exception of actions for a declaration of non-infringement of a Community trade mark.)99. Thus, as between the courts of EU Member States, the so-called “exclusive jurisdiction” rules established by the CTM Regulation are not actually exclusive at all. In contrast, Articles 92–94 of the Community Trademark Regulation aim to limit jurisdiction to only the exclusively competent EU tribunals. Thus, for those seeking to sue outside of the EU, these Articles do effectively establish exclusive jurisdiction rules, albeit in favor of more than one EU court. The conclusions just reached with respect to the Community trademarks also apply in relation to other European and Community IP rights, such as plant variety rights100 and design101. As for the national statutes and case law, since Article 22(4) of the Brussels system does not extend its exclusive jurisdiction rule to registered IPRs infringement claims, EU/EFTA Member States are not required by the Brussels Regulation to apply exclusive jurisdiction rules with respect to those claims. This conclusion is most recently reflected in the UK Supreme Court’s Lucasfilm judgment. EU/EFTA Member States do not generally include registered IPRs pure infringement claims under their exclusive jurisdiction rules even outside the Brussels system102. Furthermore, the same result is achieved by other European continental countries that are not members of the EU/EFTA. Thus, for example, Croatian courts would have jurisdiction over claims involving foreign registered IPRs pure infringement issues, raised principally or incidentally103. 97

See Council Regulation (EC) on the Community trade mark (n 3 Chapter I). See the amendments to this Regulation at accessed 30 November 2011. 98 Ibid at Articles 92–94. 99 Ibid at Articles 92–94. 100 See Council Regulation (EC) on Community plant variety rights (n 3 Chapter I). 101 See Council Regulation (EC) on Community designs (n 3 Chapter I). 102 See supra, in this same para. 103 Kunda (n 27 Chapter I) answers to HC 2.

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As for the common law countries, including the UK outside the scope of the Brussels I Regulation, the following can be said. In the UK, courts have generally refused to adjudicate foreign registered IPRs infringement claims. Yet, the ruling of the UK Supreme Court in Lucasfilm, which adopted the opposite view with respect to copyright claims, can be reasonably extended to registered IPRs infringement claims104. Furthermore, even if exclusive jurisdiction rules were still applicable with respect to those claims, their adoption should be limited to cases that do not fall under the Brussels system, so that the exclusion of the exclusive jurisdiction rule rendered by this Regulation should prevail. In Australia, as already mentioned, the Moçambique rule related to local land actions has been extended to actions for infringement of patents, excluding the jurisdiction of Australian Courts over foreign registered IPRs infringement claims105. Yet, as already stated106, recent Australian case law has “eroded the basis” for the Moçambique rule “to the point where it now seems possible that Australian courts could decide actions involving the infringement of foreign registered intellectual property rights”107. At any rate, the Australian state of New South Wales has repealed the application of the Moçambique rule108. Asian States, including China, Taiwan, Korea and Japan, do not establish any exclusive jurisdiction rules with respect to registered IPRs pure infringement claims. In China, as already mentioned, no exclusive jurisdiction rule is provided for with regard to IPRs claims in general, or specifically with respect to foreign registered IPRs disputes of whatever nature109. Thus, in 2001, the Chinese Supreme Court published the “Interpretation of Several Rules on the Legal Issues arising from Patent Disputes Litigation”, which established that “the plaintiff [in a patent infringement dispute] may sue at the place where the infringement occurs or where the defendant domiciles. The place of infringement includes: the place where the alleged patented invention, utility model products are manufactured, used, offered for sale, sold, imported; the place where the act of using patented process is committed, where the acts of using, promising to sell, selling, importing products that are directly obtained according to the patented process are committed; where the acts of manufacturing, selling, importing of patented designs products are committed. It in104

With regard to similar reasoning invoking the extension by way of interpretation of the Lucasfilm UK Supreme Court ruling from unregistered IPRs infringement issues to unregistered IPRs validity issues incidentally raised, see supra, para 16. 105 See para 65. 106 Baddeley (n 52 Chapter II) 36. See supra, para 16. 107 Ibid. 108 See para 16. 109 Zhang (n 54 Chapter II) 71, available at accessed 30 November 2011.

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cludes also the place where the result of the above infringing activities occurred”110. In Japan, exclusive jurisdiction rules exist only with respect to principally raised validity issues of registered IPRs, but not with regard to pure infringement claims111. This result was confirmed by the Tokyo District Court in the “Coral Sand judgment”112. Finally, with respect to recent academic initiatives, the four sets of Principles reject any exclusive jurisdiction rules with respect to pure infringement claims for registered IPRs. Section 211(1) of the ALI Principles states that a court is competent to adjudicate claims and defences arising under foreign laws pertaining to copyrights, neighbouring rights, patents, trademarks, trade secrets, related IP rights and contracts that are related to any of these rights. Section 212(1) further provides that a court may determine all claims and defences of the parties that arise out of the same transaction or occurrence, or series of transactions or occurrences, regardless of the territorial source of the rights at issue, provided that the court has subject matter jurisdiction under its local law and personal jurisdiction as provided by the Principles. Similarly, no exclusive jurisdiction rule is established by the CLIP Principles or by the Waseda Proposal with respect to registered IPRs pure infringement claims. No exclusive jurisdiction rule is established by the Japanese Transparency Proposal with respect to claims related to registered IPRs, of whatever nature [Article 103, see however the limited effects immediately infra], and thus includes pure infringement disputes. 19. The Very Limited Presence of Exclusive Jurisdiction Rules in Certain Common Law Countries and in India At the national level, some countries have adopted jurisdiction rules through statute and/or precedential case law which limits jurisdiction for pure infringement claims against foreign registered IPRs and operate as exclusive jurisdiction rules (whether explicitly or implicitly). For instance, in the US, the Federal Circuit adopted a subject matter jurisdiction rule in Voda that operates as a de facto exclusive jurisdiction rule113. 110 Article 5 of the said Interpretation. The translation of this text into English was kindly provided for me by Dr. Ning Zhao. See the Chinese text at accessed 30 November 2011. 111 See Article 3-5(3) of Japan’s New Act (n 61 Chapter II) on exclusive jurisdiction, on which see Takahashi (n 61 Chapter II) 9, available at accessed 30 November 2011. See also Chaen, Kono and Yokomizo (n 51 Chapter I) 98. Finally see the literature quoted with respect to the Japanese system at para 16. 112 See supra, para 16. 113 See supra, para 7.

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India is another exception, particularly among Asian countries, as its courts can only adjudicate claims related to Indian IPRs, thereby excluding foreign registered IPRs pure infringement claims114.

IV. The Prevailing Absence of Exclusive Jurisdiction Rules For Registered IPRs Validity Issues Incidentally Raised IV. The Prevailing Absence of Exclusive Jurisdiction rules 20. The Prevailing Absence of Exclusive Jurisdiction Rules in International Instruments and the Mitigation of the Scope of the Exclusive Jurisdiction Rules of the EU/EFTA Brussels System No international convention of a universal character poses exclusive jurisdiction rules for registered IPRs validity issues incidentally raised. However, there are two regional international treaties that establish exclusive jurisdiction rules for those claims, namely, the Brussels Convention, now Brussels I Regulation, and the Lugano Convention115. The exclusive jurisdiction rules of The Hague Draft Convention did not cover foreign registered IPRs validity issues incidentally raised according to Article 12(6), Alternative A or B, of the Draft Convention, but any judgment as to validity was not to have binding effects in any subsequent proceedings, even if these proceedings were between the same parties116. The approach of The Hague Draft Convention is confirmed by Article 10 of The Hague Convention on Choice of Court agreement of 2005117. The 2005 Convention does not deprive courts in countries other than the country of registration of all forms of jurisdiction in this area, and particularly allows courts to exercise jurisdiction with inter partes decisions on foreign registered IPRs validity claims incidentally raised. However, under this Convention, a validity decision concerning a registered IPR only has erga omnes effect if rendered in the country of registration. 114

Singh (n 27 Chapter I) answers to case no. 2. Brussels I Regulation (n 84 Chapter I) and Lugano Convention (n 69 Chapter I). 116 As the ALI Principles commentaries clarify “this method of handling the registered rights problem was suggested by Curtis Bradley, writing at the behest of the United States State Department negotiators of the Hague Judgments Draft. See Special Commission on International Jurisdiction and the Effect of Foreign Judgments in Civil and Commercial Matters, Hague Conference on Private International Law, Work Doc. No. 97E, 39, 122 (Nov. 1020, 1998). He distinguished between rights among individuals and rights against the world. Under his proposal to the Hague drafters, parties would be allowed to litigate their entire case in any court that has jurisdiction under the general terms of these Principles. However, if the case were litigated outside the State where the right was deposited or registered, the ‘status or validity of the deposit or registration of ... rights [would have] effect as between the parties only’”, as such the ALI Principles (n 58 Chapter I) 135. 117 See supra, para 16. 115

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As for the EU and EFTA norms, the only norms posing exclusive jurisdiction rules with respect to registered IPRs validity issues incidentally raised are the rules of the Brussels system just referred to118. Prior to the GAT decision, there was no consensus among European States as to whether courts dealing with cross-border IP disputes should dismiss the case if the validity of a foreign IPR was incidentally challenged by one of the parties as part of an infringement claim. The majority of EU continental States adopted the view that their court could still rule upon the infringement of foreign registered IPRs, even if the validity issue was raised and there were serious doubts as to the validity of the rights involved. Thus, in the Netherlands, the Court of Appeal of The Hague held in the Expandable Grafts Partnership v Boston Scientific119 that jurisdiction of the Dutch courts does not cease to exist as soon as nullity actions are instituted, especially when it is immediately clear that a nullity action lacks substantive merit. According to the judgment, a court that is asked to adjudicate the infringement proceeding after a validity issue is raised “will have to adopt a cautious attitude towards the infringement action and in principle will have to stay the infringement proceedings until the foreign court has pronounced judgment on the nullity issue”120. This approach was confirmed in the Roche v Primus case121, where the Dutch Supreme Court ruled that Dutch courts can adjudicate the infringement of foreign patents even if the validity of the patent rights involved is raised122. The same approach was followed in Germany by the District Court of Düsseldorf in both Detergent for Plastic Production Machines and in GAT123. According to these judgments, then, a mere objection by the defendant that the patent is void did not absolve the German Court of international jurisdiction to try the infringement action. Additionally, a German Court with infringement jurisdiction could decide on the validity issue incidentally raised, but this decision would only bind the parties. Some Italian courts adopted a view similar to the German one124. 118

See supra, this same para. 23 April 1998, in FSR [1999] 352. On this case see de Miguel Asensio, ‘Cross-border’ (n 6 Chapter I) 126; Fawcett and Torremans (n 51 Chapter I) 359. 120 Expandable Grafts (n 118 Chapter II) 29. 121 Case C-539/03 Roche Nederland BV v Primus [2006] ECR I-6535. See the references in Fawcett and Torremans (n 51 Chapter I) 190, footnote 359. On this case see Th.C.J.A. van Engelen, ‘Jurisdiction and Applicable Law in Matters of Intellectual Property’ (2010) 14(3) EJCL 10. On the ECJ Roche judgement see infra, this same para. 122 Fawcett and Torremans (n 51 Chapter I) 359. 123 See the references in Fawcett and Torremans (n 51 Chapter I) 360. See GAT v LuK (n 32). 124 Trib. Torino ordinanza 19.05.2000, in GADI [2001] n. 4224/1 p. 225; Corte di Appello di Milano 16.03.1990, in RDIPP [1990] 698. See Trib. Milano 17.09.1992, in GADI [1992] p. 2851. On those cases see Boschiero and Ubertazzi (n 27 Chapter I). 119

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In contrast, prior to the GAT decision, the UK courts held the radical view that courts dealing with cross-border IP disputes should dismiss the entire infringement claim once one of the parties challenged the validity of a foreign IPR. This was established by Laddie J at UK High Court in Coin Controls Ltd v Suzo International (UK) Ltd and Others of 1997125. This decision was expressly affirmed by the Court of Appeal in Fort Dodge Animal Health Ltd and Others v Akzo Nbel NV and Another126, which was followed by Prudential Assurance Co Ltd. v Prudential Insurance Co of America127. The Belgian view was the same as the English view, so that, under Belgian law the infringement jurisdiction was lost when the defendant raised a defence of invalidity of the patent128. In the last decade of the twentieth century, the conflicting approaches of EU/EFTA countries rendered possible the development of two different EUspecific litigation strategies by alleged infringers of registered IPRs: first, the alleged infringer could launch a pre-emptive action by raising the issue of non-infringement of the IPR by reason of its invalidity prior to the commencement of an action for infringement by the claimant; second, the alleged infringer raised the issue of (in)validity after the claimant had commenced an action for infringement129. In this context, the ECJ delivered the GAT judgment, which explicitly held that validity claims were to be included under the exclusive jurisdiction rules of the Brussels System, even when incidentally raised. Yet, the GAT judgment failed to solve many questions that arise with regard to Article 22(4) of the Brussels system and the applicability of exclusive jurisdiction rules to registered IPRs issues incidentally raised, as will be referred to by the following remarks. Furthermore, commentators are unanimous in criticising the application of exclusive jurisdiction rules to registered IPRs validity issues incidentally raised as grounded on questionable political grounds130. The questionable political grounds at the basis of the ECJ GAT judgment are apparent if one compares this judgment to the ECJ’s recent BVG v JPMorgan ruling of 12 May 2011131. In the GAT judgment, the ECJ estab125 [1999] Ch 33. See the case in EIPR [1997] D 187-188 annotated by Charles Gielen. On this case see de Miguel Asensio, ‘Cross-border’ (n 6 Chapter I) 120. See also Fawcett and Torremans (n 51 Chapter I) 357-359. 126 [1998] FSR 222. The case can be found in EIPR [1998] n. 10-12 annotated by Elisabeth Beresford. On this case see Fawcett and Torremans (n 51 Chapter I) 357-359. 127 [2003] EWCA (Civ) 327. See Fawcett and Torremans (n 51 Chapter I) 357-359. 128 See the references in Fawcett and Torremans (n 51 Chapter I) 360. 129 De Miguel Asensio, ‘Cross-border’ (n 6 Chapter I) 120; Fawcett and Torremans (n 51 Chapter I) 357-359. 130 See supra the literature referred to at para 1 and also para 8. 131 Case C-144/10 Berliner Verkehrsbetriebe (BVG) v JPMorgan Chase Bank NA, Frankfurt Branch [2011] OJ C194/07, available at accessed 30 November 2011.

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lished that Article 16(4) of the Brussels Convention, now Article 22(4) of the Brussels Regulation132, applies to any IPR’s validity issue even if this validity is raised incidentally, whereas in BVG v JPMorgan the ECJ ruling reached opposite conclusions133 in a case related to the Brussels system exclusive jurisdiction provision on companies, namely Article 22(2) of the Brussels I Regulation. According to Article 22(2) “the following courts shall have exclusive jurisdiction, regardless of domicile: […] in proceedings which have as their object the validity of the constitution, the nullity or the dissolution of companies or other legal persons or associations of natural or legal persons, or of the validity of the decisions of their organs, the courts of the Member State in which the company, legal person or association has its seat. In order to determine that seat, the court shall apply its rules of private international law”. In the BVG v JPMorgan case, initially before a London court, a contractual claim was contested by a German company because the decisions of the German company’s organs had led to the creation of a contract that was allegedly null134. The defendant tried to avoid the jurisdiction of the London court, arguing that the only competent courts were in Germany since the defendant was a German company, and one of the issues under discussion was the validity of decisions of its organs135. According to the defendant, Article 22(2) of the Regulation applies, although the doubts as to the validity of the company’s decisions were just a preliminary question136. While the ECJ’s ruling in GAT apparently supports the defendant’s arguments, the ECJ established that in BVG v JPMorgan that Article 22(2) of Brussels I Regulation does not apply137. The ECJ maintained that this decision did not “contradict”138 its previous ruling in the GAT. Yet, “it is obvious that the compatibility of both judgOn this ruling and on its relationship with the GAT judgment see Marta Requejo, ‘A welcome comment on ECJ’s “Berliner Verkehrsbetriebe” ruling’ (2 August 2011) accessed 30 November 2011. See also Arenas (n 32 Chapter I) 2; Espiniella Menéndez, ‘Nota a la STJUE de 12 de mayo de 2011’ [2011] REDI no. 1 (forthcoming); Christoph Thole, ‘Die Reichweite des Art. 22 Nr. 2 EuGVVO bei Rechtsstreitigkeiten über Organbeschlüsse’ (2011) 6 IPRax 541. 132 See supra, para 8. 133 Arenas (n 32 Chapter I) 10. 134 BVG v JPMorgan (n 130 Chapter II) para 19. 135 Ibid para 20. 136 Ibid. 137 BVG v JPMorgan (n 130 Chapter II) conclusions, according to which “Article 22(2) of Council Regulation (EC) No 44/2001 of 22 December 2000 on jurisdiction and the recognition and enforcement of judgments in civil and commercial matters must be interpreted as not applying to proceedings in which a company pleads that a contract cannot be relied upon against it because a decision of its organs which led to the conclusion of the contract is supposedly invalid on account of infringement of its statutes”. 138 BVG v JPMorgan (n 130 Chapter II) para 45.

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ments requires some explanation”139, and even highlights the political reasons on which the extension of exclusive jurisdiction rules to registered IPRs validity issues incidentally raised in GAT is based. Since the GAT decision was handed down, several EU and EFTA member States have shown resistances to its holding and have mitigated its scope in four different ways, as will be addressed hereafter. Those mitigations are examined in this paragraph related to the systems where the exclusive jurisdiction rules are not present, while the following paragraph is concerned with the systems where exclusive jurisdiction rules are present. The reason for examining the mitigations in question in this paragraph is that these mitigations stand against the existence of a customary public international law rule on exclusive jurisdiction in IPRs cases and at the same time are to be seen as important steps toward the trend to overcome exclusive jurisdiction rules. A first way to mitigate the scope of the exclusive jurisdiction rules of the Brussels system relates to cases involving registered IPRs validity issues incidentally raised, where the foreign registered IPR validity issue is raised in an infringement proceeding for which the forum State court has international jurisdiction. In those cases, the question arises whether the court competent to address the foreign IPR infringement claim should dismiss the case and decline jurisdiction when the validity of the foreign IPR is raised, or if it should stay the infringement proceedings and give the party raising the validity issue a short period of time to institute validity proceedings in a court with exclusive jurisdiction to hear the claim and then continue the infringement proceedings once a decision on validity has been reached – subject to the condition that if the relevant party fails to bring invalidity proceedings, this should be treated as recognition of the validity of the IPR, allowing for the infringement proceeding to continue. The first option is adopted by English courts, which are continuing to apply the principle adopted in Coin Control on the assumption that the ECJ GAT decision supports this approach140. The Coin Control authority was followed in obiter dicta by: Pumfrey J in Sandisk Corp v Koninklijke Philps Electronic NV141; Lewison J in Knorr-Bremse Systems for Commercial Vehicles Ltd v Haldex Brake Products GmbH142; Jacob LJ in the Lucasfilm case Court of Appeal’s decision143; Aikens LJ in Berliner Verkehrsbetriebe (BVG) Anstalt 139

Requejo (n 130 Chapter II). See also Arenas (n 32 Chapter I) 10, proposing to extend the exclusive jurisdiction rules of the Brussles system to proceedings where the decision on the validity of the issue involved shall have an erga omnes effect, whereas to exclude from the scope of those rules the validity claims on which the seized court shall rule with an inter partes effect. 140 Fawcett and Torremans (n 51 Chapter I) 367. 141 [2007] EWHC 332 (Ch) 39. 142 [2008] EWHC 156 (Pat) 46. 143 Lucasfilm Entertainment (n 29 Chapter I) 107.

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Des Offentlichen Rechts v JP Morgan Chase Bank NA144; and finally the Supreme Court in Lucasfilm. According to this view, Article 22(4) of the Brussels system “only assigns exclusive jurisdiction to the country where the right originates in cases which are concerned with registration or validity of rights which are ‘required to be deposited or registered’ and does not apply to infringement actions in which there is no issue as to validity”145. This same view has been adopted by the Italian Lower Instance Courts, which declined jurisdiction with regard to infringement actions related to foreign IPRs when the validity of these rights was raised as a defence, even though the Italian Courts had infringement jurisdiction (both as the place of the harmful event under Article 5(3) of the Brussels I Regulation and as the place of the defendant’s domicile according to Article 2 of the same Regulation)146. In contrast, the second option is followed in the Netherlands. In the final Roche decision, the Dutch Supreme Court147 favoured a stay of the infringement proceeding rather than abandoning them once the issue of validity was raised by the parties148. This second option has also been followed by the Zurich Handelsgericht in Switzerland. This Court actually went even further in its Eurojobs Personaldienstleistungen SA v Eurojob AG judgment of 23 October 2006149, holding not only that the courts of the State with infringement jurisdiction should stay the infringement claim until the issue of validity has been determined in the State of registration, but that the defendant should also be obliged to bring the validity case within a certain time limit. If he or she fails to do so, the defendant will be deemed as having abandoned the validity argument. This judgment was confirmed by the Swiss Federal Court in the Eurojobs Personaldienstleistungen SA v Eurojob AG judgment of 4 April 2007, I150. The first option is an incorrect application of the Brussels system since this system does not extend exclusive jurisdiction rules to infringement issues, but covers only validity claims. Thus, the second way should be favoured for the following reasons. First, this conclusion is based on a literal interpretation of the GAT judgment, according to which “there is nothing in GAT to stop a 144

BVG v JPMorgan [2010] EWCA Civ 390, 69-70. Lucasfilm Ltd. & Ors v Ainsworth & Anor (n 30 Chapter I) 109. 146 See Trib. Torino 10.03.2009, in RDIPP [2010] p. 496 and in GADI [2009] n. 5407 p. 741. See also Trib. Venezia 16.04.2011, unpublished and Trib. Milano 60696/07 29.11.2007, according to which the exclusive jurisdiction rule of the Brussels system will anyhow apply to infringement proceedings. On those cases see Boschiero and Ubertazzi (n 27 Chapter I). 147 On this case see supra, this same para. 148 See Fawcett and Torremans (n 51 Chapter I) 367. 149 On this case see Paul Torremans, ‘Overcoming GAT: The Way ahead for Cross-Border Intellectual Property Litigation in Europe’ [2008] RCDIP 73. 150 Zivilabteilung 4C.439/2006, see accessed 30 November 2011. On this case see Torremans (n 148 Chapter II) 73. 145

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plaintiff from exercising his right under the [Brussels] Regulation to bring an action for infringement in the Member State of the defendant’s domicile or in the place of the harmful effect”151 (according to Article 2 of the Brussels Regulation and respectively to Article 5(3) of the same Regulation): “and this basic right is not lost by the defence of invalidity being raised”152. Second, the same conclusion is supported also by the Advocate General Geelhoed’s opinion rendered in the GAT case, which adopted the view that the infringement claim and the validity issue should be split between different Member States and even went on to propose that the ECJ adopt this option153. Third, the same conclusion is supported also by the systematic interpretation of the ECJ GAT decision and the opinion of the Advocate General Geelhoed just mentioned, since the ECJ did not explicitly dissent from the opinion of Advocate General and thus should be interpreted as following his view154. Fourth, further support for this conclusion can be found in the ECJ Roche decision “regard[ing] the law after GAT as being that the issue of validity and the claim for infringement will be split between the courts of different member States”155. Fifth, the same conclusion is supported by practical reasons, since the opposite view leads to the so-called “super torpedoes”156, related to cases where in a claim brought in EU Member State A for infringement of a right registered in EU Member State B the defendant raises the question of validity incidental151

Fawcett and Torremans (n 51 Chapter I) 363. Ibid. 153 See C-4/03 Opinion of Advocate General Geelhoed, delivered 16 September 2004 (1), paras 36-37, according to which “as already noted, the referring court wishes to know the scope of the exclusive jurisdiction conferred by Article 16(4) of the Brussels Convention on the courts of the State in which a patent is registered or deposited. From the submissions to the Court three propositions can be derived (for further details see Section III of this Opinion): – first proposition: Article 16(4) only applies if the principal claim of a proceeding concerns the validity of patents; – second proposition: validity and infringement are, in practice, inseparable in patent proceedings and therefore Article 16(4) also applies to infringement actions; – third proposition: only the court indicated in Article 16(4) is competent to determine the validity or nullity of a patent. Other issues concerning patents fall outside Article 16(4). 37. I propose that the Court should opt for the third proposition, for the following reasons”. On this opinion see Fawcett and Torremans (n 51 Chapter I) 364, recalling the Dutch nationality of the Advocate General and the fact that the option supported by him is also the approach of the Court of Appeal of The Hague in the Expandable Grafts case (n 118 Chapter II) case. 154 See Ulrich Magnus and Peter Mankowski (eds), Brussels I Regulation – European Commentaries on Private International Law (Sellier 2007) 362-363; Fawcett and Torremans (n 51 Chapter I) 364. 155 Fawcett and Torremans (n 51 Chapter I) 364. 156 See Burkhard Hess, Thomas Pfeiffer and Peter Schlosser, ‘Report on the Application of Regulation Brussels I in the Member States’ Study JLS/C4/2005/032007, available at accessed 30 November 2011, p. 336. See also Fawcett and Torremans (n 51 Chapter I) 387. 152

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ly but then, deliberately seeking to delay or freeze the litigation, fails to proceed with an action before the court of the State of registration of the IPR involved that is competent to address its validity issue. A second way to mitigate the scope of the exclusive jurisdiction rules of the Brussels system related to registered IPRs validity issues incidentally raised concerns cases where the validity claim is incidentally raised in the frame of a preliminary proceeding. In such cases, certain States invoke the non-application of the exclusive jurisdiction rules of the Brussels system. For example, in the Netherlands, the District Court of The Hague on one occasion referred questions to the ECJ regarding the applicability of Article 22(4) of the Brussels I Regulation and the ECJ GAT decision to provisional measures in its decision of 15 September 2010, while on another occasion stated that courts other than the courts of the State that granted the IPR at hand have jurisdiction to render provisional injunctions also when the validity of the litigious IPR is disputed157. A third way to mitigate the scope of the exclusive jurisdiction rules of the Brussels system related to registered IPRs validity issues incidentally raised concerns cases where non-EU registered IPRs are at stake. Those cases deal with the issue of whether the exclusive jurisdiction rules of the Brussels system have a so called “reflexive effect”, and therefore are extendable also to validity issues incidentally raised with respect to IPRs registered in nonMember States. Specifically, the question arises whether Article 22(4) of the Brussels system creates “extra EU jurisdiction”158 thereby potentially extending its scope to cases where the IPR is registered in a non-EU member country and preventing courts in EU Member States from exercising jurisdiction over validity claims incidentally raised involving foreign non-EU IPRs. This question has not been solved by the ECJ, but the process of recasting the Brussels I Regulation will give an answer to this problem159. Meanwhile EU Member States have dealt with this question autonomously. So, inter alia in France the answer to this question is negative and therefore French courts 157

See supra, footnote 307. Lucasfilm Ltd. & Ors v Ainsworth & Anor (n 30 Chapter I) 105. 159 See Proposal for a Regulation of the European Parliament and of the Council on jurisdiction and the recognition and enforcement of judgments in civil and commercial matters (n 84 Chapter I) 3.1, according to which “the proposed elements of the reform are as follows: […] extension of the jurisdiction rules of the Regulation to disputes involving third country defendants, including regulating the situations where the same issue is pending before a court inside and outside the EU”. Before the adoption of the Proposal in question, in favour of the reflexive effect of all exclusive jurisdiction rules of the Brussels system see Georges Droz, ‘La Convention de San Sebastian alignant la Convention de Bruxelles sur la Convention de Lugano’ [1990] RCDIP 14. Favouring the reflexive effect of Article 22(4) of the Brussels system see Torremans, ‘The Sense or Nonsense’ (n 47 Chapter I) conclusive remarks. Compare see Bariatti, ‘La giurisdizione’ (n 47 Chapter I) 503. 158

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might make a decision upon validity issues incidentally raised for foreign non-EU IPRs, but this decision would have effects limited to the parties of the dispute. In the UK the same opinion was followed in obiter dicta by the UK Court of Appeal’s Lucasfilm ruling, according to which “Art. 22.4 of the Regulation provides for exclusive jurisdiction, regardless of domicile, in respect of a variety of identified matters, … [including] validity of patent rights”, but “[n]one of that would apply to non-EU matters of the type excluded by Art. 22”160: “[s]o…if proceedings for infringement of a US patent were brought against a person domiciled in a Member State, Art. 22 does not exclude jurisdiction over validity. So the defendant could challenge the validity of the patent”161. A fourth way to mitigate the scope of the exclusive jurisdiction rule regarding registered IPRs validity issues incidentally raised concerns cases where the Courts ascertain that the declining of jurisdiction by virtue of exclusive jurisdiction rules could lead to a denial of justice. In those cases, courts would rule that the exclusive jurisdiction rules of the Brussels system are contrary to the human right of access to a court. This conclusion is in line with the thesis purported in Chapter VI that exclusive jurisdiction rules are contrary to the public international law rules on the denial of justice and on the human right of access to a court. Interestingly enough, the same conclusion was reached inter alia by a recent Dutch decision rendered by the District Court of The Hague in the 2007 Single Buoy Moorings v Bluewater case162. In this case, the owner of a European patent sued a Dutch company, claiming that by manufacturing and offering the essential parts of the plaintiff’s patented invention for sale with knowledge that such parts would be installed by a third party in two countries for which the plaintiff had been granted the European patent (UK and Norway), the defendant committed a special form of indirect cross-border infringement. The defendant raised the question of the invalidity of the European patent before the Dutch Court. Thus, according to the ECJ’s GAT decision, the Dutch Court should have at least declined 160

Lucasfilm Entertainment (n 29 Chapter I) 107. Ibid. 162 On this case see ‘Cross-border Jurisdiction after GAT/LuK: International “Indirect” Infringement’ NautaDutilh E-Newsletter Intellectual Property (6 June 2007) at 1 accessed 30 November 2011. See also John Anders, et al., ‘Liability for Contributory Infringement of IPRs – Certain Aspects of Patent Infringement’ The Netherlands International Association for the Protection of Intellectual Property accessed 30 November 2011. On contributory infringement see also Graeme Dinwoodie, Rochelle Dreyfuss and Annette Kur, ‘The Law Applicable to Secondary Liability in Intellectual Property Cases’ (2010) 42 N.Y.U J. Int’l & Pol. 201. 161

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its jurisdiction with respect to the validity issues of the English and Norway portions of the European patent at stake. However, the District Court of The Hague distinguished between the GAT case and the dispute before it, stating that the claim before the German Court in GAT concerned the judgment of the validity of a French patent in just one territory (France). However, in the case before the Dutch Court, the claim would involve determining the validity of a European patent in two territories, UK and Norway, creating a risk of conflicting judgments with respect to validity which in the Dutch Court’s opinion would have rendered reaching a judgment on infringement impossible. The Court considered this undesirable and in conflict with Article 6 of the Convention for the Protection of Human Rights and Fundamental Freedoms (hereafter: ECHR)163. Additionally, the Dutch Court established that although it considered itself to be competent to adjudicate the case, the exclusive jurisdiction provision of the Brussels System as interpreted by the ECJ GAT decision obliged it to defer a decision concerning the validity of a foreign patent, if nullity proceedings are instituted in the involved foreign country, without regard to the stage of the Dutch proceedings. However, since in the case in question no nullity proceedings had been instituted before the implicated Norwegian and UK Courts, the Dutch Court decided to examine the European patent validity issue with respect to its Norwegian and UK parts as raised by the defendant. This decision deserves to be particularly welcomed because it takes into account the inopportuneness of the GAT solution, and it tries to escape it. Thus, the first conclusion from this decision regarding the incompatibility of the exclusive jurisdiction provisions of the Brussels System with Article 6 of the ECHR, deserves to be approved for all the arguments that will be examined in chapter VI. However, the second conclusion regarding the obligation of the Dutch Court to defer the validity issue of the foreign portions of the European patent to their respective domestic courts only if nullity proceedings were instituted before them, as well as the reasons grounding both conclusions of this decision, are not convincing. Thus, even if nullity proceedings were instituted before the respective domestic courts of the foreign portions of the European patent, the exclusive jurisdiction rules should still be considered contrary to public international law and therefore inapplicable for all the arguments that will be examined in chapter VI, which militate against them. Second, the alleged differences between the case pending before the Dutch Court and the GAT case, namely the number of territories involved by the validity claim or the positive or negative nature of the infringement claim in issue, are indeed to be considered irrelevant to the Brussels System’s norms of exclusive jurisdiction, as interpreted by the ECJ. 163 On this Article see in detail infra, chapter VI. Compare with Frigo (n 32 Chapter I), according to whom the GAT decision should be positively evaluated since it grants the principle of legal certainty, in conformity with Article 6 of the ECHR.

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To sum up, the EU and EFTA systems establish exclusive jurisdiction rules with regard to registered IPRs validity issues incidentally raised. Yet, the scope of those rules is mitigated at least in the four different ways just highlighted. In contrast, despite the fact that Articles 92–94 of the Community Trademark Regulation refer to “exclusive jurisdiction” rule also for validity issues incidentally raised164, those norms do not ground the international jurisdiction of a sole and exclusive competent court, but rather establish a plurality of possible different competent tribunals and therefore are not at all exclusive, at least with respect to EU member States. In contrast, from the perspective of States that are not members of the EU, Articles 92–94 of the Community Trademark Regulation effectively establish exclusive jurisdiction rules, even though in favor of more than one EU court165. The conclusions just reached with respect to the Community trademarks also apply in relation to other European and Community IP rights, such as plant variety rights166 and design167. 21. The Prevailing Absence of Exclusive Jurisdiction Rules in National Statutory or Case-Law Rules and in the Most Recent Academic Initiatives Principles. As for the national statutes and case law, in the frame of the Brussels I Regulation, EU Member States are obliged to apply exclusive jurisdiction rules for registered IPRs validity issues incidentally raised, according to the exclusive jurisdiction rules of the Brussels system168. Yet, the scope of those rules can be mitigated in at least the four different ways just highlighted169. As for other European continental countries that are not members of the EU or the EFTA, many courts may exercise jurisdiction over validity issues incidentally raised. For example, in Croatia, in the absence of specific statutory provisions or court judgments on the point, Articles 187 and 27 of the Civil Procedure Act may be applied together to allow for a Croatian court to exercise jurisdiction over disputes concerning the validity of a foreign IPR incidentally raised170. The majority of Asian States have rejected exclusive jurisdiction rules for registered IPR validity issues incidentally raised. States following this approach include China, Taiwan, Korea and Japan. As already mentioned with respect to China, there are no exclusive jurisdiction rules provided for with 164

See supra, para 18. Ibid. 166 Ibid. 167 Ibid. 168 See previous para. 169 Ibid. 170 Kunda (n 27 Chapter I) answers to HC 2. 165

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regard to IPRs claims in general, and therefore also with respect to foreign registered IPRs validity issues incidentally raised171. In Taiwan, while there is no exclusive jurisdiction rule of a statutory or case-law nature, Article 24 of the proposed Draft Amendment to Applicable Law for International Civil Disputes of Taiwan provides that the national courts can decide the validity of registered foreign IPRs raised incidentally, albeit the judgment on the validity issue will have legal effects only between the parties. Furthermore, the Taiwanese literature reaches the same conclusions with respect to the current frame172. In Korea, exclusive jurisdiction rules with respect to actions related to the existence, granting, registration, validity and revocation of a registered IPR that have developed through case law do not encompass registered IPRs validity issues incidentally raised173. In Japan, exclusive jurisdiction rules exist only with respect to principally raised validity issues of registered IPRs, but not with regard to validity claims incidentally raised, the ruling on which would have, however, only inter partes effects174. Finally, as for the most recent academic codification initiatives, the four sets of Principles reject any exclusive jurisdiction rules with respect to registered IPRs validity issues incidentally raised. Thus, Section 211(1) of the ALI Principles states that a court is competent to adjudicate claims and defences arising under foreign laws pertaining to copyrights, neighbouring rights, patents, trademarks, trade secrets, related IP rights and contracts that are related to any of these rights. Section 212(1) further provides that a court may determine all claims and defences of the parties that arise out of the same transaction or occurrence, or series of transactions or occurrences, regardless of the territorial source of the rights at issue, provided that the court has subject matter jurisdiction under its local law and personal jurisdiction as provided by the Principles. It is made explicitly clear in Section 212(4) that courts have authority to adjudicate defences related to the invalidity of foreign registered IPRs. Similarly, Article 2:401(2) of the CLIP Principles provides that where granting, registration, validity, abandonment or revocation claims arise in a context other than by principal claim or counterclaim, the exclusive jurisdiction of the courts of the State of registration does not apply. Moreover, Article 2:206 stipulates that an action for a declaratory judgment can be brought on 171

Zhang (n 54 Chapter II) 71. Yet, no specific reference is made to the validity issues incidentally raised by the author, who limits himself to highlighting the absence of exclusive jurisdiction rules on the field. 172 Chen (n 60 Chapter II para IV.B. 173 See notes 183, 184 and 296 for further references. 174 Chaen, Kono and Yokomizo (n 51 Chapter I) 81, referring to relevant Japanese statutes, case law and literature on the point.

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the same terms as an action seeking substantial relief. Also, Article 103(2) of the Japanese Transparency Proposal provides that Japanese courts are competent to adjudicate claims of existence, registration, validity, or ownership related to foreign IPRs, provided that another jurisdiction criterion, such as the defendant’s domicile or the infringement place, grounds their international jurisdiction. Furthermore, Article 209(2) of the Waseda Proposal provides that where disputes arising out of acquiring, registering, disclaiming or revoking and validity of intellectual property rights are brought in a context of preliminary and incidental questions, exclusive jurisdiction of the courts of the State where the IPR was registered does not apply. As for the effects of a ruling on a registered IPR validity issue incidentally raised, while according to the Transparency Proposal the decision on the foreign IPR validity issue incidentally raised affects the parties to the action with respect to any subsequent actions, the other three sets of Principles stipulate that the decisions resulting from such disputes are effective only to resolve the dispute among the parties of the action but they do not affect later claims with regard to the same parties of the proceeding, as well as to third parties: “even for the parties in such a dispute, the decision rendered by the court that has exclusive jurisdiction derived from these Principles ought to prevail over that rendered by any other court, and the decisions in preliminary questions do not affect the subsequent proceedings”175. This approach is similar to the one adopted by The Hague Preliminary Draft Convention on Jurisdiction according to which the decision on validity of foreign IPRs shall have no binding effect in subsequent proceedings, even if they are between the same parties176. 22. The Presence of Exclusive Jurisdiction Rules in the Brussels System, albeit with Mitigated Scope. The limited Presence of Exclusive Jurisdiction Rules in Certain Common Law Countries and in India. The EU/EFTA Brussels system establishes exclusive jurisdiction rules for registered IPRs validity issues incidentally raised. Yet, the scope of those rules can be mitigated in at least the four different ways just highlighted. As for the EU norms, besides Article 22(4), exclusive jurisdiction rules are posed by Articles 92–94 of the Community Trademark Regulation and by the corresponding rules related to EU plant variety rights and design177. Thus, 175

Waseda Proposal (n 61 Chapter I) 18. See Article 12(6) of The Hague Preliminary Draft Convention on Jurisdiction (n 13 Chapter I) according to which “Paragraphs 4 and 5 shall not apply where one of the above matters arises as an incidental question in proceedings before a court not having exclusive jurisdiction under those paragraphs. However, the ruling in that matter shall have no binding effect in subsequent proceedings, even if they are between the same parties”. See supra, para 20. 177 See supra, para 18. 176

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these rules concern also validity issues incidentally raised. Yet, the exclusive jurisdiction rule of Article 22(4) is limited in scope and authority by the absolute majority of the EU member States. Additionally, the exclusive jurisdiction rules posed by the rules on EU IPRs are effectively exclusive only in relation to the courts of the States that are not members of the EU, but allow for jurisdiction in a variety of courts within the EU. At the national level, some common law countries adopt exclusive jurisdiction rules of a statutory or a case-law nature for registered IPRs validity issues incidentally raised. Among those systems are the US178, the UK179, Australia180, New Zealand, and South Africa. Finally, as an exception among the Asian countries, Indian courts can adjudicate claims related only to Indian IPRs, and therefore exclusive jurisdiction rules cover also registered IPRs pure infringement claims181.

V. The Emerging Rejection of Exclusive Jurisdiction rules For Registered IPRs Validity Issues Principally Raised V. The Emerging Rejection of Exclusive Jurisdiction rules 23. The Emerging Rejection of Exclusive Jurisdiction Rules In the international frame no international convention of a universal nature establishes any exclusive jurisdiction rules with regard to registered IPRs validity issues principally raised. Thus, the only international conventions that establish such rules are of a regional nature, namely the ones of the Brussels system182. In contrast, the inclusion of such exclusive jurisdiction, even with a

178

Voda (n 31 Chapter I) 29, according to which “given the number of US patent cases that we resolve on validity or enforceability as opposed to infringement grounds, exercising such jurisdiction could be fundamentally unfair to the alleged infringer where, as one amicus curiae points out, ‘the patent is in fact invalid and the defendant would be excused from liability on that basis in a foreign forum’. Voda has not shown in this case that the validity of the foreign patents would not be at issue. Indeed, Cordis US asserts otherwise”. 179 See supra, para 20. 180 Baddeley (n 52 Chapter II) 45, in critical terms. 181 Singh (n 27 Chapter I) answers to case no. 2. 182 The European Patent Convention (n 3 Chapter I) encompassed a rule on exclusive jurisdiction “according to which the courts of each State bound by the Convention are to have exclusive jurisdiction in proceedings concerned with the registration or validity of any European patent granted for that State, without prejudice to the juris- diction of the European Patent Office. [This rule] [...] was contained in Article Vd of Protocol 1 to the 1988 Convention, [and] has now been incorporated into Article 22(4). The last part of the provision as it stood in the Protocol has been omitted: it made an exception to the exclusive jurisdiction of the courts of the States bound by the Convention where the patent was a Community patent under Article 86 of the Convention for the European patent for the common market, signed in Lux-

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limited scope, in The Hague Preliminary Draft Convention on Jurisdiction183 was one of the principal reasons for the failure of that draft. Articles 12(4) and 12(5) of the draft granted exclusive jurisdiction in IPRs cases to the courts of the contracting State in which the deposit or registration had been applied for, had actually taken place, or was deemed to have taken place, but did not extend it either to copyright and related rights, or to infringement issues, nor to validity issues incidentally raised in an infringement proceeding or in a licence agreement litigation184. Despite this limited scope, the issue of exclusive jurisdiction grounded in the provisions in question was extensively debated185. Furthermore, Article 10 of The Hague Convention on Choice of Court Agreements of 30 June 2005186 states that only a decision on validity of registered IPRs in the country of registration will have effect erga omnes. Yet, first this Convention addresses only a very limited issue with respect to IPRs cross-border litigation, namely the choice of courts agreement. Second, this Convention does not pose any exclusive jurisdiction rules but limits itself to recognise implicitly the effects of the ones present in the Member States’ systems. Third, the clear implication of Article 10 is that courts in countries different from the country of registration of an IPR are not deprived of all forms of jurisdiction in this area: judgments on validity of a foreign IPRs are acceptable, but with their effects limited to the parties of the proceeding. Certain national systems reach the same results with regard to the overcoming of exclusive jurisdiction rules with regard to registered IPRs validity issues principally raised. In Croatia, in the absence of specific statutory provisions or court judgments on the point, Articles 187 and 27 of the Civil Procedure Act may be applied together to allow for a Croatian court to exercise jurisdiction over disputes concerning even the validity of a foreign IPR principally raised187. The same result can be achieved in certain Asian States including China and Taiwan. As already mentioned, China doesn’t have an exclusive jurisdiction rule regarding IPRs generally, and therefore also with respect to foreign registered IPRs validity issues principally raised188. In Taiwan, in the absence of exclusive jurisdiction rules, Article 24 of the proposed Draft Amendment to Applicable Law for International Civil Disputes of Taiwan provides that the national courts can decide the validity of embourg on 15 December 1975”, as such the Lugano Convention (n 69 Chapter I). Explanatory Report by Pocar (n 108 Chapter I) 26. 183 See supra, para 2. 184 See Articles 12(4) and 12(5) of the Draft Nygh and Pocar Report (n 13 Chapter I) 261; Kono and Jurys (n 27 Chapter I) section 4(1). See supra, para 18. 185 See supra, para 18. 186 See supra, para 16. 187 Kunda (n 27 Chapter I) answers to HC 2. 188 Zhang (n 54 ChapterII) 71.

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registered foreign IPRs, regardless of how the validity issue is raised and thus even if it is raised in a principal way, with the judgment on the validity issue having legal effects only between the parties. Furthermore, the Taiwanese literature reaches the same conclusions with respect to the current frame189. In Japan, Article 3-5(3) of Japan’s Act on International Jurisdiction, establishes that “an action with respect to the existence and effect of an intellectual property right […] which comes into existence by registration shall be subject to the exclusive jurisdiction of the Japanese courts if the registration was effected in Japan”190. Yet, this rule concerns only Japanese IPRs and in principle does not exclude that Japanese Courts may adjudicate validity issues principally raised for foreign IPRs. In addition, in Japan there is a strong school of thought that “Japanese courts should have international jurisdiction over actions concerning the validity of foreign IP rights for two reasons. […] The first reason is that rejecting the exclusive jurisdiction of the country of registration would contribute to adequate dispute resolution. […] The second reason is that the base for recognising the exclusive jurisdiction of the country of registration over actions concerning the validity of a right are not necessarily firm”191. Finally, two of the four sets of Principles overcome the exclusive jurisdiction rules also for validity issues principally raised192. Thus, the ALI Principles and the Transparency Proposal reject exclusive jurisdiction rules that limit all validity issues principally raised in relation to registered IPRs to the State of registration. The ALI Principles do so under stricter conditions, namely the defendant’s residence in the forum State and the multi-state registration of the IPR involved193. However, no such conditions are posed by the Transparency Proposal, which establishes that the Japanese courts can adjudicate the validity issue of a foreign registered IPR principally raised, provided that they have international jurisdiction on a ground other than the place of 189

Chen (n 60 Chapter II) para IV.B. See supra, para 18. 191 Chaen, Kono and Yokomizo (n 51 Chapter I) 86-87. On these two reasons see infra the following remarks of this book. 192 Chaen, Kono and Yokomizo (n 51 Chapter I) 88, according to whom “the ALI Principles and the Transparency Proposal are in agreement on this point of departure from the rule of exclusive jurisdiction of the country of registration”. The Transparency proposal (n 60 Chapter I) also rejects exclusive jurisdiction in the country of registration with regard to IPRs registration issues. See ibid. See supra, para 5 for the notion of validity adopted by this book as inclusive of registration also. 193 According to Article 213(3) of the ALI Principles (n 58 Chapter I), it is possible to principally raise validity issues of IPRs registered in multiple states before the court of the defendant’s domicile. This rule is explained as a compromise between the reluctance to examine the acts of foreign governments and efficiency purposes. See the ALI Principles (n 58 Chapter I) 213, Comment C. See also Chaen, Kono and Yokomizo (n 51 Chapter I) 86 and 88. 190

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registration194. Yet, for both the ALI Principles and the Transparency Proposal, only a decision on validity principally raised in the country of registration of the IPR involved will have effect erga omnes195. In this context it is relevant to refer to a criticism addressed to the Transparency Proposal rejection of exclusive jurisdiction rule, but that could be extended, mutatis mutandis, to the same rejection of the ALI Principles. According to this criticism the exclusive jurisdiction rejection in validity issues principally raised would be useless196 and would not fulfil the requirement posed i.a. by Japanese law of the procedural interests of the parties. The criticism at stake does not render immediately clear why it reaches those conclusions, but it seems reasonable to understand it as being based on the limited effects of the judgment on the validity of a foreign IPR principally raised. In other words, since the judgment on validity does not bind either third parties or the same parties with respect to their future actions, the judgment would be completely ineffective. Yet, this criticism does not convince. In fact, even if the judgment of the court binds only the parties and does not have any effect on their future legal actions, this judgment still becomes res judicata for the parties with respect to its object. In other words should one of the parties want to raise the validity issue related to the foreign IPR involved once again, the claimant should challenge said validity on the basis of arguments different than the ones that constituted the object of the judgment which became res judicata. Furthermore, according to the commentary on the ALI Principles the limitation of the effects of judgments on foreign IPRs validity issues to the parties of the dispute “may not result in as much duplicative litigation as might appear at first blush, for once the court of one commercially significant jurisdiction declares a for194

According to Article 103(2), Japanese courts also have international jurisdiction over IPRs granted under a foreign law as long as there is a ground to affirm the jurisdiction of Japanese courts, such as the defendant’s domicile. In sum, Article 103 does not pose an exclusive jurisdiction rule and therefore allows Japanese courts to adjudicate registered as well as unregistered foreign IPRs existence, registration, validity, or ownership issues provided that another ground of jurisdiction exists in favour of Japanese courts. See Chaen, Kono and Yokomizo (n 51 Chapter I) 79 and 88. 195 According to Section 211(2) of the ALI Principles (n 58 Chapter I) the adjudication of the validity of registered rights granted under the laws of another State is effective only to resolve the dispute among the parties to the action. The same is stated by Section 212(4), which allows the court to adjudicate defenses related to the invalidity of foreign registered IPRs but limits the effect of the judgment to the parties to that action. Finally, Section 213(2) stipulates that the effect of a declaratory judgment on rights registered in States other than the forum will be limited to the parties to the action. See also the ALI Principles (n 58 Chapter I) 137. According to the Transparency Proposal (n 60 Chapter I) the extent of the jurisdiction of Japanese courts over foreign IPRs validity issues is limited to the parties of the proceeding. 196 Paulius Jurys, Yuko Nishitani and Simon Vande Walle, ‘Summary of Comments and Discussion on International Jurisdiction’ in Basedow, Kono and Metzger (n 2 Chapter I) 142.

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eign patent invalid, the patentee cannot easily enforce the right, or counterpart rights, against any other party”197. Finally, it is perfectly conceivable that the parties comply voluntarily with a judgment on validity of a foreign IPR, being for instance just in need of legal certainty and aiming at avoiding further litigation between themselves, especially when the IPRs at stake are registered in many different jurisdictions: in fact, their voluntary compliance would prevent them from raising the validity issue of the IPR at stake in various different legal systems, with the risk of initiating inefficient proceedings, which are usually extremely costly and lead to divergent outcomes198. So, the limitation of effects of the judgments on foreign registered IPRs validity issues principally raised adopted by the ALI Principles and by the Transparency Proposal is not sufficient enough to indicate their rejection of exclusive jurisdiction rules as useless. Yet, the same limitation of effects seems to be criticisable for the same reasons related to the criticism to exclusive jurisdiction rules. In fact, said limitation of effects is grounded on sovereignty reasons by the Commentaries on the ALI Principles and on the Transparency Proposal, whereas the same limitation is based on the need to avoid the amendment of foreign registers by the Commentary on the CLIP Principles. However, as will be referred to in chapters III and V, sovereignty reasons and arguments related to the amendment of foreign registers are not convincing with respect to international jurisdiction issues related to IPRs and the effects of foreign judgments on updating of national registers shall be determined not by limiting ex ante the effects of the judgments of foreign courts on matters inscribed in these registers, but rather according to the usual PIL relevant methods related to the recognition and enforcement of foreign judgments, i.a. the public policy reasons. So, national courts should be allowed to refuse to recognise a foreign judgment on the validity of a national IPR whenever this judgment is against public policy. Yet, the public policy exception shall be adopted in a restrictive way with regard to IP transnational litigation, as will be highlighted in chapter V. Interestingly enough this view seems to be confirmed also by the Commentaries on the Transparency Proposal and the ALI Principles. In fact, according to the commentaries on the Transparency Proposal their rejection of exclusive jurisdiction for foreign registered IPRs validity issues principally raised might lead to “cases where a foreign court has international jurisdiction over actions concerning the validity of Japanese IP rights and invalidates those rights. But the Transparency Proposal provides, as a requirement of the 197

See the ALI Principles (n 58 Chapter I) 135. See Chaen, Kono and Yokomizo (n 51 Chapter I) 88 according to whom “even if a judgment by a court of a country other than the country of registration is not recognised in other countries, it is possible that the parties will voluntarily comply with the judgment, particularly in the case of jurisdiction by a choice-of-court agreement or agreed arbitration”. 198

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recognition and enforcement of foreign judgments, that ‘the content of the judgment and the courts proceedings are not contrary to the public policy in Japan’ in Article 402(3), and it is understood that non-application of the absolutely mandatory statutes, the inconsistency of the rights situation with the country of registration, or the non-guaranteeing of an opportunity to pursue a claim about the validity and scope of rights may be contrary to public policy”199. The possible overcoming of the limitation of the effects of judgments on foreign IPRs validity issues seems to be purported also by the ALI Principles commentaries. In fact, those commentaries establish that “a mechanism for public notification of inter se invalidity determinations would be a useful complement to the Principles as it would contribute to maintaining the public domain”200. In other words according to these commentaries even though the decision on foreign registered IPRs validity issues should have only inter partes effects, they could be notified to the entire world so that they could produce effects even outside their territorially limited framework. 24. The Exclusive Jurisdiction Rules in EU/EFTA Norms as well as in the National Statutory or Case-Law Rules The Brussels system poses exclusive jurisdiction rules for registered IPRs validity issues principally raised for EU/EFTA Member Countries. Moreover, in the EU exclusive jurisdiction rules are also posed by Articles 92–94 of the Community Trademark Regulation and by the corresponding rules related to EU plant variety rights and design. Thus, these rules concern also validity issues principally raised. Yet, the exclusive jurisdiction rules posed by the rules on EU IPRs are effectively exclusive only in relation to States that are not members of the EU. At the national level, EU member States apply the exclusive jurisdiction rules of the Brussels system, albeit their reflex effect with regard to States that are not members of the EU is highly questionable. Also, common law countries typically adopt exclusive jurisdiction rules of a statutory or a case-law nature for registered IPRs validity issues principally raised. Additionally, Indian courts can adjudicate claims related only to Indian IPRs, and therefore exclusive jurisdiction rules cover also registered IPRs validity issues principally raised201. Finally, among the Asian States in Korea exclusive jurisdiction rules with respect to actions principally raised related to 199 See Chaen, Kono and Yokomizo (n 51 Chapter I) 89. Note that the commentaries at stake use the word “may” and therefore the contrariety to the registration state public policy of said judgments shall be demonstrated on a case-by-case basis, always interpreting the public policy exception restrictively. 200 See ALI Principles (n 58 Chapter I) 136. 201 Singh (n 27 Chapter I) answers to case no. 2.

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the existence, granting, registration, validity and revocation of a registered IPR have developed through case law202. Two of the four sets of Principles establish exclusive jurisdiction rules with respect to registered IPRs validity issues principally raised, namely the CLIP Principles, and the Waseda Proposal. Thus, the CLIP Principles and the Waseda Proposal do not allow the courts in countries other than the State of registration to examine the validity of registered IPRs, when the issue is principally raised, even if the effect would be limited to the parties of the proceeding. Furthermore, those sets of Principles follow the approach that only a decision in the country of registration will have effect erga omnes203.

202

See notes 183, 184 and 296 for further references. Article 2:401 of the CLIP Principles (n 59 Chapter I) grants exclusive subject matter jurisdiction to the courts of the State where a patent, a mark, an industrial design or any other intellectual property right is protected on the basis of actual registration or is deemed to have been registered under the terms of an international Convention, with respect to claims concerning its granting, registration, validity, abandonment or revocation, whether such claims are raised principally or by counterclaim. Article 2:401(1) does not specify the scope of the court’s authority at the place of registration, but it can be established by referring to Article 2:401(2). Hence, this last Article excludes from the scope of the exclusive jurisdiction rule posed by Article 2:401(1) registered IPR validity issues raised in a context other than by principal claim or counterclaim. However, Article 2:401(2) specifies that the decisions resulting from such disputes do not affect the validity or registration of those rights as against third parties. Thus, a systematic interpretation of these rules leads to the result that the decisions resulting from the court at the place of registration affect the validity or registration of the IPRs at stake as against third parties. Additionally, Article 2:402 establishes that when a court of a State is seized of a claim over which the courts of another State have exclusive jurisdiction by virtue of Article 2:401, the court seized shall declare of its own motion that it has no jurisdiction. As for the Waseda Proposal (n 61 Chapter I) its Article 209 stipulates that the courts of the State of registration shall exclusively resolve any dispute arising out of the acquisition, registration, disclaiming or revocation, and validity of intellectual property rights. Article 209 does not specify the scope of the court’s authority at the place of registration. Yet, this scope can be established by referring to Article 209(2). Hence, this last Article excludes from the scope of the exclusive jurisdiction rule posed by Article 209(1) IPR validity issues that arise in a context of preliminary and incidental questions. However, Article 209(2) specifies that the decisions resulting from such disputes do not affect later claims. Thus, a systematic interpretation of these rules leads to the result that the decisions resulting from the court at the place of registration affect later claims and therefore have erga omnes effects. 203

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VI. Conclusions VI. Conclusions 25. The Exclusive Jurisdiction Rules Related to Unregistered IPRs Pure Infringement Claims and Validity Claims however Raised, as well as Registered IPRs Pure Infringement Claims and Validity Claims Incidentally Raised, are not an Expression of a Customary International Law Rule. As for unregistered IPRs pure infringement claims and validity issues principally or incidentally raised, as well as for registered IPRs pure infringement claims and validity issues incidentally raised, the comparison indicates that exclusive jurisdiction rules are not an expression of a customary international law rule. In fact, in the international legal system, only two regional Conventions (the Brussels and the Lugano Conventions) establish exclusive jurisdiction rules, but limit those rules to registered IPRs validity issues, incidentally or principally raised. Yet, the scope of the exclusive jurisdiction rules of the Brussels system related to registered IPRs validity issues incidentally raised is mitigated further with respect to international jurisdiction for infringement cases, preliminary proceedings, non-EU/EFTA IPRs, and cases where the exclusive jurisdiction rules lead to denial of justices. In contrast, The Hague Preliminary Draft Convention on Jurisdiction adopted the approach according to which exclusive jurisdiction rules shall not apply to unregistered IPRs validity or infringement issues, as well as to registered IPRs validity claims incidentally raised. Indeed, the negotiations of The Hague Preliminary Draft Convention on Jurisdiction considered an exclusive jurisdiction rule related to registered IPRs infringement claims and validity issues principally raised. However, this rule was highly debated, and probably even led to the failure of the Convention as such. Article 10 of The Hague Convention on Choice of Court agreement of 2005 confirms this approach, as highlighted in para 16. At the national level, the prevailing view is that exclusive jurisdiction rules are not to be applied. Only a few States pose exclusive jurisdiction rules with regard to registered IPRs validity issues incidentally raised. Additionally, all recent academic initiatives abandon exclusive jurisdiction rules with respect to unregistered IPRs infringement or validity claims however raised, as well as with respect to pure infringement claims for registered IPRs and validity issues incidentally raised. In summary, first, the different systems examined highlight that the very few exclusive jurisdiction rules related to unregistered IPRs validity and infringement issues as well as registered IPRs pure infringement claims and validity issues incidentally raised do not express a practice that is concordant, commune and constant, thus univocal and repetitive: accordingly these exclusive jurisdiction rules do not express a customary international law rule.

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Second, the relevant States’ practice in favour of the cross-border adjudication of unregistered IPRs claims, or to the registered IPRs pure infringement claims or validity claims incidentally raised just mentioned never invokes exceptions or justifications to derogate from an allegedly existent customary public international law rule expressed by the exclusive jurisdiction rules in this sense. Neither have the States whose practice is in favour of exclusive jurisdiction rules treated the other States’ practice of allowing the cross-border adjudication of the IPRs claims in issue as a breach of the allegedly existent customary public international law rule expressed by the exclusive jurisdiction rules of the former countries. Thus, these States’ practice not only does not confirm but also and especially excludes that exclusive jurisdiction rules express a customary international law rule. Third, this conclusion is even confirmed by the trend to overcome and abandon exclusive jurisdiction rules. 26. The Exclusive Jurisdiction Rules Related to Registered IPRs Validity Issues Principally Raised are not an Expression of Customary Law. As for registered IPRs validity issues principally raised, the comparison indicates the following. If on the one hand the majority of the systems of the world do not allow courts to adjudicate foreign registered IPRs validity issues principally raised, on the other hand other countries such as China and Taiwan do not provide for any exclusive jurisdiction rule with respect to IPRs claims, and therefore even with regard to validity issues principally raised. Furthermore, there is a clear trend to overcome exclusive jurisdiction rules also in relation to those claims, as is demonstrated by the ALI Principles and by the Transparency Proposal. However, it is evident that the main expression of the States’ practice establishes exclusive jurisdiction rules with regard to registered IPRs validity issues principally raised. Thus, the objective element of the customary public international law rules probably exists, namely the concordant, commune and constant, thus univocal and repetitive behaviours of the different States of the international community. Yet, the subjective element of the customary public international law rule, and thus the States’ opinio juris ac necessitatis, is lacking. In fact, exclusive jurisdiction rules are grounded on opportunistic (and questionable) reasons, namely the advantages that the limitation of jurisdiction that follows exclusive jurisdiction rules has with respect to the administrative requirements related to the amendment of the foreign registries where the IPR in issue is inscribed: in fact, exclusive jurisdiction rules avoid the amendment of foreign registers by their national intellectual property office. This conclusion is confirmed by the trend to abandon exclusive jurisdiction rules even with respect to registered IPRs validity issues principally raised, since the expressions of this trend limit the effects of the judgment on the for-

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eign registered IPRs validity issues principally raised to the parties of the proceedings and as such avoid the amendment of registers of foreign countries. Finally, the relevant States’ practice favourable to the cross-border adjudication of registered IPRs validity issues principally raised never invokes exceptions or justifications to derogate from an allegedly existent customary public international law rule expressed by the exclusive jurisdiction rules. Neither, does the States’ practice in favour of exclusive jurisdiction rules for those claims treat the States’ practice favourable to the cross-border adjudication of registered IPRs validity issues principally raised as a breach of the allegedly existent customary public international law rule expressed by the exclusive jurisdiction rules of the former States. Thus, the States’ practice that is in favour of the cross-border adjudication of registered IPRs validity issues principally raised not only does not confirm but also and especially excludes that exclusive jurisdiction rules express a customary international law rule.

Chapter III

The Act of State Doctrine and Comity do not Mandate Exclusive Jurisdiction Rules I. Introduction I. Introduction 27. Reasons for addressing the Act of State Doctrine and Comity in this Same Chapter. Both the act of State and comity doctrines have been interpreted by scholars and in judicial opinions as an impediment to the adjudication of foreign IPRs claims. This approach is based on the following reasoning. First, the act of State doctrine and comity prevent national courts from sitting in judgment of claims related to matters that are an expression of the sovereignty of foreign governments or that are strictly connected to the political and economic interests of a State. It is then reasoned that IPRs are an expression of the sovereignty of foreign governments and are strictly connected to the political and economic interests of the State that granted them. Thus, IPRs fall within the scope of both the act of State and comity doctrines and, as such, prevent courts from adjudicating foreign IPRs claims. The many reasons that this approach is unconvincing will be addressed in the following remarks. Before doing so, however, it is necessary to explain the reasons both for analysing the act of State doctrine and comity together and for primarily addressing only common law jurisprudence. As for parallel analysis of the act of State doctrine and comity, it is important to remember that the act of State doctrine and comity are distinct doctrines. The act of State doctrine is employed by common law countries as a rule requiring the courts to refrain from adjudicating the sovereign acts of foreign states taken within the foreign states’ own territories, notwithstanding any conflicts with the domestic public policy1, whereas civil law countries adopt the almost corresponding doctrine of foreign public acts. In contrast, comity is employed by the courts of common law countries as a principle which allows them to refrain from exercising jurisdiction and defer the adjudication of cases to foreign courts when adjudication of the claim could clash with the policies of the

1

See infra, paras 30–32.

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foreign government involved and create conflict between the domestic and foreign States2. Despite the fact that these are separate doctrines, there are several reasons for addressing the two notions in a single chapter. First, notwithstanding the formal differences between the act of State doctrine and comity, certain views “today employ the principle of international comity as a substitute for the act of state doctrine, or simply mingle the two distinct principles”3. Furthermore, certain approaches maintain that “comity […] is but one of several ‘policies’ that underlie the act of state ‘doctrine’”4. In a similar light, recent opinions have emphasised that “the policy reasons for the doctrine” of the act of state are “separation of powers and international comity”5. Finally, certain arguments both for and against the extension of the act of State doctrine to IPRs cases are also relevant to the relationship between comity and cross-border IPRs enforcement issues, as will be addressed in the last paragraph of this chapter. 28. Reasons for Primarily Addressing Common Law Jurisprudence As for the reasons for addressing primarily the common law jurisprudence, it is relevant to highlight that the act of State and comity doctrines have been applied primarily in the United States, and were extended to other common law jurisdictions by courts relying extensively on US Courts’ opinions6. By comparison, the act of State and comity doctrines are not generally viewed as forming part of the jurisprudence of civil law countries, which usually adopt the doctrine of foreign public acts instead7. Since the common law is a system of jurisprudence that is traditionally based on precedent instead of statutory

2

See infra, paras 36-38. Tyshow (n 34 Chapter I) 277. As an example see the case New Name Inc. v The Walt Disney Co. et al., (2007) WL 5061697 (C.D. Cal. 2007), where the United States District Court of California mentions comity while referring to the impossibility of calling into question the acts of foreign sovereign nations. On this case see infra, para 37. See also the cases mentioned by Peter Nicolas, ‘The Use of Preclusion Doctrine, Antisuit Injunctions, and Forum Non Conveniens Dismissals in Transnational Intellectual Property Litigation’ (1999) 40 Va J. Int’l L. 361. See Tyshow (n 34 Chapter I) 277. 4 Tyshow (n 34 Chapter I) 300. 5 Susan Morrison, ‘The Act of state Doctrine and the Demise of International Comity’ (1991-1992) 2 Ind. Int’l & Comp. L. Rev. 334-335. See also Nicolas, ‘The Use of Preclusion Doctrine’ (n 2 Chapter III) 361, according to whom “the act of state doctrine is an abstention principle grounded at least in part on notions of comity”. Finally, see Azar (n 38 Chapter I) 482. 6 See infra, paras 30-32. 7 See infra, para 30. 3

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laws8, the following remarks primarily examine the relevant case law that constitutes authority in the field, beginning with the leading precedential case and moving forward in chronological order. 29. The Act of State and Comity Doctrines as “Suggested” by Public International Law The declining of jurisdiction on the basis of the act of State and/or comity doctrines is not the result of any general public international law obligation, but rather is a discretionary act of self-restraint9. Indeed, as already referred to10 and as will be explained in the following remarks11, the act of State doctrine and comity are defined as non-binding principles governing international affairs which are based on public international law rationales12. Therefore, this book refers to the act of State and comity doctrine as “suggested”, rather than imposed, by public international law.

II. Theses According to which the Act of State Doctrine Implicitly Poses Exclusive Jurisdiction Rules II. Theses according to which the Act of State Doctrine 30. Theses According to which the Act of State Doctrine Establishes Implicit Exclusive Jurisdiction Rules: the Voda, and the ECJ GAT Decisions The act of State doctrine has been adopted by many important judgments around the world to impose de facto exclusive jurisdiction rules in registered IPRs cases. Among these judgments are the Voda and GAT judgments13. In the Voda case, the US Court of Appeals for the Federal Circuit adopts the act of State doctrine as part of its reasoning for refusing to hear the claims of infringement relating to the foreign patents. The Court adopts this doctrine on the basis of two different assumptions. First the Court maintains that “the act of [S]tate doctrine ‘requires that, in the process of deciding, the acts of foreign sovereigns taken within their own jurisdictions shall be deemed valid’”14. Second, the Court highlights that the act of granting IPRs qualifies as an act of 8

See John Bell, ‘Sources of Law’ in Peters Birks, English Private Law (Vol. 1 OUP 2000)

28. 9

See supra, para 1. Ibid. 11 See infra, paras 30-32 and 36-38. 12 See Calamita (n 35 Chapter I) 623; Maier (n 37 Chapter I) 281; Hill (n 37 Chapter I) 126; Kämmerer (n 38 Chapter I) para 1; Azar (n 38 Chapter I) 482. See also the literature quoted at para 1 with respect to comity and the act of state doctrines. 13 See paras 1, 7 and 8. 14 Voda (n 31 Chapter I) 904, recalling Kirkpatrick Co. Inc. v Environmental Tectonics Corporation International 493 U.S. 400, 406, 409 (1990). 10

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State by foreign sovereigns and therefore those rights must be deemed valid according to the act of State doctrine. With particular regard to the second assumption, the Federal Circuit acknowledges the recent case law of lower courts, which found that the mere issuance of patents by a foreign power does not constitute an act of State15. However, the Voda Court maintains that “none of the parties or amicus curiae have persuaded us that the grant of a patent by a sovereign is not an act of [S]tate”, and therefore “assuming arguendo that the act of state doctrine applies”16, it would prevent the Court from inquiring into the validity of a patent right and force the Court to “adjudicate patent claims regardless of validity or enforceability”17. Thus, while the case before the Court related to infringement of foreign patents as opposed to validity, the Court maintains that “given the number of US patent cases that we resolve on validity or enforceability as opposed to infringement grounds, exercising such jurisdiction could be fundamentally unfair to the alleged infringer where […] the patent is in fact invalid and the defendant would be excused from liability on that basis in a foreign forum”18. In this particular case, “Voda has not shown…that the validity of the foreign patents would not be at issue”19 and Cordis asserts that it will be at issue20. Thus the Court dismissed the foreign infringement claims under the act of State doctrine. In the GAT case, the ECJ held that the courts of the State which granted the IPR have exclusive jurisdiction whenever invalidity is at issue, however raised (principally or incidentally)21. In its decision, the ECJ does not explicitly mention the act of State doctrine. However, the ECJ maintained that “exclusive jurisdiction is justified by the fact that the issue of patents necessitates the involvement of the national administrative authorities (see, to that effect, the Report on the Convention by Mr Jenard)”22. Here, the ECJ referenced the Jenard Report, according to which the granting of a patent is an “exercise of national sovereignty”23. Thus, the ECJ adopts the same two arguments that are the basis for applying the act of State doctrine in Voda, namely that acts of state taken by foreign sovereigns within their own jurisdictions shall be deemed valid and the granting of IPRs qualifies as an act of state.

15

See infra, para 34. Voda (n 31 Chapter I) 904. 17 Ibid. 18 Ibid. 19 Ibid. 20 Ibid. 21 See supra, paras 1 and 8. 22 GAT v LuK (n 32 Chapter I) para 23. 23 Jenard (n 261 Chapter I) 36. 16

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31. Other Relevant Judgments The Voda and GAT judgments are in line with other US judgments that adopt the act of State doctrine and its grounding arguments to dismiss foreign IPRs validity and infringement cases, including the following. In Vanity Fair Mills of 1 June 195624 the US Court of Appeals for the Second Circuit refused to entertain claims requiring it to determine the validity of a Canadian trademark. In this case, the defendant held a registered trademark for the mark “Vanity-Fair” in Canada, while the plaintiff had registered the same trademark in the United States. The plaintiff, however, believed that it had superior rights in the mark not only in the United States, but also in Canada. Therefore, the plaintiff sought, inter alia, a declaration of its superior rights in the Vanity-Fair trademark in both countries and injunctive relief preventing the defendant from using the Vanity-Fair trademark in either country. The Court refused to adjudicate the claims that would have required an adjudication of the validity of the Canadian trademark, since “it is well-established that the courts of one state will not determine the validity of the acts of a foreign sovereign done within its borders”25. In Packard Instrument of 21 July 197226, the US District Court for the Northern District of Illinois refused to exercise its jurisdiction over claims of alleged infringements of foreign patents from nine foreign countries (Canada, Sweden, France, Switzerland, Italy, Japan, West Germany, the United Kingdom, and Israel) which corresponded to the plaintiff’s US patent, where the defendant had asserted the respective invalidity of each patent as an affirmative defence and had counterclaimed for a declaratory judgment of invalidity. In response, the Court stated that “the determination by this court that a foreign patent is invalid, i.e., that the act of an agency of a foreign government is invalid, would raise serious questions of comity”27. Particularly, in this case comity clearly stands for the act of State doctrine28.

24

Vanity Fair Mills v T. Eaton Con. 234 F.2d 633 (1956) available at accessed 30 November 2011. On this case see Mark Caldwell, ‘Accepting Jurisdiction in Foreign Patent Validity Suits- Packard Instrument Co. v. Beckman Instruments, Inc., 346 F.Supp. 408 (1972)’ (1976-1977) 6 Denv. J. Int’l L. & Pol’y 193; David Toraya, ‘Federal Jurisdiction over Foreign Copyright Infringement Actions – An Unsolicited Reply to Professor Nimmer’ (1984-1985) 70 Corn. L. Rev. 1174; Nicolas, ‘The Use of Preclusion Doctrine’ (n 2 Chapter III) 360. 25 Vanity Fair (n 23 Chapter III) 647. 26 Packard Instrument Co. v Beckman Instruments Inc. 346 F.Supp. 408 (N.D. III. 1972). On this case see Toraya (n 23 Chapter III) 1177; Caldwell (n 23 Chapter III) 191; Nicolas, ‘The Use of Preclusion Doctrine’ (n 2 Chapter III) 361. 27 Packard Instrument (n 25 Chapter III) 410, citing Vanity Fair. 28 See supra, para 27.

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Additionally, Berkshire Furniture of 13 December 199529 involved conflicting claims of ownership to bed frame designs under the laws of different countries: the plaintiff under United States law while the defendants under the laws of the United Kingdom and Malaysia. The plaintiff sought a declaration of the rights between the parties to the designs under US, UK, and Malaysian law as well as injunctive relief barring the defendant from enforcing its design claims against the plaintiff or its suppliers. The court refused to hear the plaintiff’s claims, stating that the plaintiff is essentially seeking “to adjudicate the validity of a design registration issued in a foreign country”30 and it cited Vanity Fair for the proposition that US Courts have long recognized the impropriety of adjudicating foreign intellectual property registrations31. In Dahlgren of 12 August 197532, the United States District Court for the Northern District of Texas examined the defendant’s counterclaim “which seeks an injunction against […] [the plaintiff] to restrain the exertion of rights under certain foreign patents against [the defendant, and which] […] also seeks to direct the plaintiff to negotiate licensing agreements relating to these foreign patents as is allegedly contemplated by the […] cross-licensing agreement between the parties”33. In this light, the plaintiff argued that the Court lacks jurisdiction over the defendant’s counterclaim based on the act of State doctrine, because “the entertainment of the counterclaim would require a decision on the invalidity of the patents issued by other nations and […] such a decision would be an unwarranted intrusion into the sovereignty of foreign states”34. However, the Court held that “nothing in the counterclaim seeks to void any foreign patent obtained by the [plaintiff]...but merely seeks to refrain the Plaintiff from using those patents which allegedly are now being used in violation of a contract between two American nationals”35. Therefore, the United States District Court for the Northern District of Texas did not apply the act of state doctrine to the case in issue. In New Name Inc. v The Walt Disney Co. et al. of 3 December 200736, before the United States District Court for the Central District of California, the plaintiff sought a ruling that the defendants violated Canadian trademark and copyright laws. Although the Court mentioned comity, rather than the act of State doctrine, when referring to the impossibility of calling into question the acts of foreign nations37, the Court implicitly recalled the act of State doctrine 29

Berkshire Furniture Co. Inc. v Glattstein 921 F.Supp. 1559, 1561 (W.D. Ky 1995). Ibid 1559. 31 Ibid 1561. 32 Dahlgren Manufacturing Co. v Harris Corp. 399 F.Supp. 1253, (N.D. Tex. 1975). 33 Ibid 1256. 34 Ibid. 35 Ibid 1257. 36 Walt Disney (n 2 Chapter III). 37 Ibid 13. 30

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in its holding accepting jurisdiction over the foreign IPRs claims. According to the Court, “here, Plaintiff seeks a ruling that Defendants violated Canadian trademark and copyright laws”38. However, according to the Court, “nothing in the complaint suggests that applying Canadian laws to the facts of this case will call into question the legislative, executive, judiciary acts of Canada. The cases cited by Defendants are inappropriate insofar as they involve situations in which the acts of other nations would be called into question”39. Therefore, the court does not apply the act of state doctrine to the case in issue. In Fairchild Semiconductor of 10 December 200840 the plaintiff was a licensee of two patents, one US and one Chinese, which were owned by the defendant. In this action, it sought, inter alia, a declaratory judgment that it did not owe royalties with respect to a certain device it produced because that device was not within the scope of the Chinese patent. In its ruling, the United States District Court for the District of Maine decided to hear the claim, but maintained that “the act of [S]tate doctrine is not implicated, because there is no challenge to the Chinese patent’s validity”. According to the Court, “it is therefore not unfair to deal with the patent issue (as it might have been if validity were challenged and could not be addressed)”41. In contrast, as was recently emphasised by the UK Supreme Court’s Lucasfilm 27 July 2011 ruling, “in England the foreign act of [S]tate doctrine has not been applied to any acts other than foreign legislation or governmental acts of officials such as requisition, and it should not today be regarded as an impediment to an action for infringement of foreign intellectual property rights, even if validity of a grant is in issue, simply because the action calls into question the decision of a foreign official”42. The act of State doctrine does not apply in any other Commonwealth countries, except for Australia, where it was imposed by the Potter ruling43. Thus, the UK Supreme Court’s Lucasfilm 27 July 2011 ruling emphasised that “in the Commonwealth Potter v Broken Hill Pty Co Ltd appears to stand alone in using the act of [S]tate doc-

38

Ibid 14. Ibid 14. 40 Fairchild Semiconductor Corp. v Third Dimension (3D) Semiconductor Inc. 589 F.Supp.2d 84, 91 and 94 (Maine 2008). On this case see Nicolas, ‘The Use of Preclusion Doctrine’ (n 2 Chapter III) 362; Dessemontet, ‘The ALI Principles’ (n 20 Chapter I) 37 footnote 9. 41 Fairchild Semiconductor (n 39 Chapter III) 96, referring to the Voda case on which see supra, para 1. 42 Lucasfilm Ltd. & Ors v Ainsworth & Anor (n 30 Chapter I) 87. On the act of state doctrine in the British and Commonwealth Practice see Jean Pierre Fonteyne, ‘Act of State’ in Bernhardt (n 11 Chapter II). It was published under the auspices of the Max Planck Institute for comparative public law and international law (Amsterdam, Vol. 1 1992) page 18. 43 Lucasfilm Ltd. & Ors v Ainsworth & Anor (n 30 Chapter I) 85. 39

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trine as an impediment to actions for infringement of foreign intellectual property rights”44. 32. The Inapplicability of the Act of State Doctrine to Unregistered IPRs There is US case-law45 which supports the idea that the act of State doctrine does not extend to unregistered IPRs since those rights come into being without any condition of formalities and therefore adjudication of those rights would not require a Court to pass on the validity of acts of foreign government officials. Among these judgments we can mention the following46. In London Film Productions of 17 February 198447, the United States District Court for the Southern District of New York considered whether to adjudicate copyright infringement claims arising i.a. under Chilean law and concluded that “the British films at issue here received copyright protection in Great Britain simply by virtue of publication there [and] Chile’s adherence to the Berne Convention in 1970 automatically conferred copyright protection on these films in Chile. Therefore no ‘act of [S]tate’ is called into question here”48. Thus, “the court accepted Professor Nimmer's view that the act of state doctrine was not engaged: in adjudicating an infringement action under a foreign copyright law there was no need to pass upon the validity of acts of foreign governmental officials, since foreign copyright laws did not generally incorporate administrative formalities which had to be satisfied to create or perfect a copyright”49. Similarly, in Frink America of 8 April 199750 the US District Court for the Northern District of New York recalled the holding of the London Film and maintained that it could adjudicate a copyright infringement claim arising under Canadian copyright law, “because US and Canada were signatories to the

44

Ibid. As just referred to in the previous paragraph the act of state doctrine does not apply in the UK. 46 See the thesis of Professor Nimmer referenced by inter alia Toraya (n 23 Chapter III) 1166. 47 London Film Productions Ltd. v Intercontinental Communications, Inc. 580 F. Supp. 47 (S.D.N.Y. 1984). See Toraya (n 23 Chapter III) 1165: Nathan Wollman, ‘Manoeurvering through the Landmines of Multiterritorial Copyright Litigation: how to avoid the Presumption against Extraterritorial when attempting to recover for the Foreign Exploitation of U.S. Copyrighted Works’ (2001-2002) 104 W. Va. L. Rev. 379. 48 London Film (n 46 Chapter III) 49. 49 Lucasfilm Ltd. & Ors v Ainsworth & Anor (n 30 Chapter I) 85. 50 Frink America, Inc. v Champion Road Machinery Ltd. et al. 961 F.Supp. 398, 404 (N.D.N.Y. 1997). On this case see Nicolas, ‘The Use of Preclusion Doctrine’ (n 2 Chapter III) 363. 45

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Berne Convention, which bars administrative formalities, and therefore there was no question of passing on acts of foreign government”51. In Walt Disney of 3 December 200752 the United States District Court for the Central District of California also quoted the London Film judgment, emphasising that “in adjudicating an infringement action under a foreign copyright law there is […] no need to pass upon the validity of acts of foreign governments officials’ […] since foreign copyright laws, by and large, do not incorporate administrative formalities which must be satisfied to create or perfect a copyright”53. In the very recent Rundquist v Vapiano case of 20 July 201154, the United States District Court for the District of Columbia considered that it had subject matter jurisdiction to adjudicate the alleged infringement of the defendants copyrights under fifteen foreign laws55. The Court applied the reasoning of both London Film and Frink America and found that it “will not need to evaluate the propriety of foreign administrative acts”56 because all the countries where the foreign claims arose are signatories to the Berne Convention which bars administrative formalities in relation to copyrights: therefore, the act of state doctrine did not play any relevant role in the case.

III. The Act of State Doctrine does not Pose Exclusive Jurisdiction Rules III. The Act of State Doctrine does not Pose 33. The Act of State Doctrine does not Prevent Courts from Adjudicating Foreign Acts of States The first assumption in support of the act of State doctrine in general, namely that it aims at respecting the sovereignty of foreign governments and thereby prevents courts from adjudicating acts of state by other sovereigns, does not convince. In fact, over the past few decades, the act of State doctrine has been interpreted to no longer prevent courts from adjudicating all foreign acts of states. The act of state evolution in this sense can be described as follows. When the act of State doctrine was first developed in common law jurisprudence, it was aimed at respecting the sovereignty of foreign countries. At the end of the 19th century the US Supreme Court in the Underhill v Hernan-

51

Lucasfilm Ltd. & Ors v Ainsworth & Anor (n 30 Chapter I) 85. Walt Disney (n 2 Chapter III). 53 Ibid. 54 Ewa-Marie Rundquist v Vapiano SE, unreported. 2011 U.S. Dist. LEXIS 78781. 55 See the 15 countries listed in Rundquist v Vapiano (ibid) 77. 56 Ibid. 52

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dez judgment of 189757, applied the act of State doctrine in the context of foreign expropriations58 and provided that “the courts in one country will not sit in judgment on the acts of another done within its territory”59, whenever “the relief sought or the defense interposed […] requires a court in the United States to declare invalid the official act of a foreign sovereign performed within its own territory”60. Therefore, the act of State doctrine required courts to consider foreign acts of state as rules of decision which must always be treated as valid61. The doctrine was aimed at avoiding an affront to the independent sovereignty of foreign states and “was grounded on an essentially territorially based conception of sovereignty and jurisdiction”62. Although the purpose of the doctrine was to safeguard the sovereignty of foreign countries, its invocation was not limited to state officials, but rather the doctrine was, and still is, invoked primarily in cases between private parties. Subsequently a series of judgments began to limit the scope of the act of State doctrine, restricting it to cases involving property situated in the expropriating State’s territory63. When it occurred that expropriated property was outside the expropriating State’s territory, the act of State doctrine did not apply and consequently left courts free to inquire into the validity of foreign acts of expropriation64. Later on a series of judgments began modifying application of the act of State doctrine so that it was aimed at preserving the basic relationships between branches of government in a system of separation of powers, rather than at safeguarding the sovereignty of foreign governments65. Thus, in the 57

168 US 250 (1897), on which see Hazel Fox, ‘International Law and Restraints on the Exercise of Jurisdiction by National Courts of States’ in Malcom Evans (ed), International Law (2nd edn, OUP 2006) 383; Morrison (n 4 Chapter III) 311; Nicolas, ‘The Use of Preclusion Doctrine’ (n 2 Chapter III) 359. 58 For other issues involving the act of state doctrine such as foreign exchange controls and foreign export bans in the UK see Trevor Hartley, ‘Foreign Public Law and Private International Law: English Report’ in Frédéric-Edouard Klein (ed), Basle Symposium on Rôle of Public Law in Private International Law (20-21 March 1986) (Basel, Helbing & Lichtenhahn 1991) 23 and 25. 59 Underhill v Hernandez (n 56 Chapter III) 250. 60 Kirkpatrick (n 13 Chapter III) 405. 61 Tobias Thienel, ‘The Act of State Doctrine: in Violation of International Law’ (The Core, 23 October 2006), available at accessed 30 November 2011; Patrick Pearsall, ‘Means/Ends Reciprocity in the Act of state Doctrine’ (2005) 43 Colum. J. Transnat'l L. 99. 62 Fonteyne (n 41 Chapter III) 17. 63 With regard to the UK system see Hartley (n 57 Chapter III) 14, quoting relevant caselaw on the point. 64 See Republic of Iraq v First National City Bank 353 F. 2d 47 (2nd Cir. 1965). With regard to the UK system this conclusion is reached by the case-law referred to by Hartley (n 57 Chapter III) 19. 65 Hill (n 37 Chapter I) 129.

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Sabbatino case66, the US Supreme Court explained that “the act of [S]tate doctrine does […] have ‘constitutional’ underpinnings. It arises out of the basic relationships between branches of government in a system of separation of powers. It concerns the competency of dissimilar institutions to make and implement particular kinds of decisions in the area of international relations. The doctrine as formulated in past decisions expresses the strong sense of the Judicial Branch that its engagement in the task of passing on the validity of foreign acts of state may hinder rather than further this country’s pursuit of goals both for itself and for the community of nations as a whole in the international sphere”67. In other words, according to the new version of the act of State doctrine, it was retained and implemented only when there was concern that the US judicial decision over the acts of foreign States might restrict executive discretion in the conduct of international relations68. The doctrine, then, addressed “an issue concerned with a basic choice regarding the competence and function of the Judiciary and the National Executive in ordering out relationships with other members of the international community”69, in that it prevented the courts from ever denying the validity of the acts of a sovereign State and reserving this matter entirely to the competence of other branches of government70. Subsequently, a series of judgments developed further limitations on the act of State doctrine. The first limitation concerns cases in which the State Department has given a clear indication of executive policy opposing the validity of a given foreign act71. A second limitation refers to cases where an essentially commercial transaction is involved and courts have declared the act of State doctrine inapplicable in relation to these cases, “thus importing into the Act of [S]tate area the same distinction now primarily relied upon in the United States in determining the scope of sovereign immunity”72. A third lim-

66 See Banco Nacional de Cuba v Sabbatino 376 U.S. 398 (1964), on which see Morrison (n 4 Chapter III) 312; Hill (n 37 Chapter I) 140-141; Tyshow (n 34 Chapter I) 282; Nicolas, ‘The Use of Preclusion Doctrine’ (n 2 Chapter III) 359; Brownlie (n 33 Chapter I) 504. 67 Sabbatino (n 65 Chapter III) 423. 68 See in critical terms Fonteyne (n 41 Chapter III) 17, according to whom “the retention of this distinction is somewhat puzzling, however, as the potential for judicial interference with executive policy options would appear just as great where the expropriated property was originally outside the expropriating State’s territory”. 69 Sabbatino (n 65 Chapter III) 425. 70 Thienel (n 60 Chapter III). 71 See Bernstein v Van Heyghen Frères 163 F.2d 246 (2nd Cir.1947). See also First National City Bank v Banco Nacional de Cuba 406 U.S. 759 (1972). See Azar (n 38 Chapter I) 481. 72 Fonteyne (n 71 Chapter III) 18; Hill (n 37 Chapter I) 155; See Azar (n 38 Chapter I) 481.

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itation concerns cases where the foreign act in issue is contrary to the public policy of the forum State73 and violates international law74. As for the civil law systems, the doctrine of foreign public acts before national courts75, as it is applied today, leads to results similar to the act of State doctrine76. In the beginning, as with the act of State doctrine in common law countries, the approach proper of civil law countries was that foreign public acts were not to be (applied and) adjudicated by national courts, due to their asserted territorial nature77. In a second phase, this strict traditional approach was abandoned in favour of the reasoning that was upheld also by the Institut de droit international78 and that relied on conflict of laws principles concerning recognition of foreign 73

Fox (n 56 Chapter III) 384, with specific reference to the UK system. Hill (n 37 Chapter I) 149-150, according to whom, however, American law has not fully accepted the international law exception, whereas the UK accepted it. 75 The category of foreign public acts is characterized as inclusive of single acts that are adopted by non-judiciary and legislative bodies […] and therefore this residual category is defined in a purely negative sense. As such Pierre Mayer, La distinction entre règle et décisions et le droit international privé (Paris, Dalloz 1973) 17. 76 See Luca Radicati di Brozolo, ‘Foreign Public Law Before Italian Courts’ in Klein (n 57 Chapter III) 110-111, highlighting that certain Italian and other civil law countries’ courts attitude with respect to foreign public law, on which see the immediately following remarks, is grounded on the act of state doctrine “which, albeit not generally viewed as forming part of Italian law, has some authoritative supporters in this country as well”, such as the followings: Riccardo Luzzatto, Stati stranieri e giurisdizione nazionale (Milano, Giuffrè 1972) 262; Giuseppe Sperduti, ‘Azioni giudiziarie in uno Stato per nazionalizzazioni ed espropriazioni di beni stranieri nel diritto internazionale pubblico’ (1973) RDIPP 286; Paolo Mengozzi, L’efficacia in Italia di atti stranieri di potestà pubblica su beni private (Milano, Giuffrè 1967) 221; Luigi Condorelli, ‘Il ‘riconoscimento generale’ delle consuetudini internazionali nella costituzione italiana’ [1979] RDIPP 21. See also Maria Berentelg, ‘Die Act of State-Doktrin als Zukunftsmodell für Deutschland?’ (Tübingen, Mohr Siebeck 2010). But compare the reasons against the act of state doctrine Massimo Panebianco, Giurisdizione interna e immunità degli Stati stranieri (Napoli 1967) 251; Francioni Francesco, ‘Petrolio libico, giudice italiano e diritto internazionale’ (1974) RDIPP 454; Giuseppe Barile, ‘Ordine pubblico (diritto Internazionale privato)’ in Encyclopedia del diritto (1980) 1115; Benedetto Conforti, Diritto Internazionale (7th edn, Editoriale Scientifica 2006) 232; Enzo Cannizzaro, Corso di diritto internazionale (Milano, Giuffrè 2011). 77 See Radicati di Brozolo (n 75 Chapter III) 86, explaining in detail the reasons for this radical approach and recalling relevant Italian literature on the point. See also Benedetto Conforti, L’esecuzione delle obbligazioni in diritto internazionale privato (Napoli 1962) 155; Panebianco (n 75 Chapter III) 125; Mengozzi (n 75 Chapter III) 120; Tullio Treves, Il controllo dei cambi nel diritto internazionale privato (Padova, Cedam 1967) 89; Giuseppe Sperduti, ‘Droit international privé et droit public étranger’ [1977] JDI 5. 78 See Institut de Droit International, Session of Wiesbaden, Rapporteur Pierre Lalive, ‘The Application of Foreign Public Law’ (1975) 56 Annuaire de l’Institut de droit international 157 accessed 30 November 2011. On this Resolution see Pierre Mayer, ‘Le rôle du droit public en droit international privé français’ in Klein (n 57 Chapter III) 63; Radicati di Brozolo (n 75 Chapter III) 88. 74

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pubic acts. According to this reasoning, then, national courts shall apply foreign public acts where they form part of the legal system of which the law is applicable to the case involved. So, for instance with regard to the effects to be given to foreign nationalisation or expropriation decrees of tangible properties79, civil law countries traditionally invoke the lex rei sitae and acknowledge in principle the effectiveness of foreign acts within the expropriating State’s territory80, refusing instead to recognise the effect of foreign nationalisation laws and measures with respect to assets not situated in the territory of their enacting state at the moment of the enactment. In other words, these countries refuse to accept any extraterritorial effects to the foreign public acts81. In a third phase, civil law courts started to apply foreign public acts and adjudicate their validity even in relation to properties situated within the expropriating State’s own boundaries. The adjudication of the validity of the foreign act involved occurs also today and is conditioned on one of the following two requirements being met. First, the foreign act involved must infringe fundamental legal values of an internal or international origin that form part of the domestic public policy exception82. Alternatively, the foreign public act involved must violate rules of public international law that apply in the domestic legal system83. Additionally, the adjudication of the validity of a for79

For intangible assets such as shareholders’ rights see for Germany, Gerhard Kegel, ‘The Rôle of Public Law in Private International Law: German Report’ in Klein (n 57 Chapter III) 42; for France see Mayer (n 77 Chapter III) 71-72. For expropriation of IPRs see for France Mayer (n 77 Chapter III) 72; for Italy Radicati di Brozolo (n 75 Chapter III) 100. See also Ubertazzi (n 43 Chapter I) 89-138. For other issues regarding the role of public law in private international law such as foreign exchange law, foreign export bans, anti-trust law, law of procedure, labour law and social security law, social law and law on cultural property see for Germany Kegel (n 78 Chapter III) 42; for France see Mayer (n 77 Chapter III) 64. 80 Compare in critical terms for Germany Kegel (n 78 Chapter III) 37; for Italy Radicati di Brozolo (n 75 Chapter III) 98. 81 See the references in Kegel (n 78 Chapter III) 37; Radicati di Brozolo (n 75 Chapter III) 98; Fonteyne (n 41 Chapter III) 19; Berentelg (n 75 Chapter III) 160. 82 See Radicati di Brozolo (n 75 Chapter III) 92; Fonteyne (n 41 Chapter III) 19; Matthias Ruffert, ‘Recognition of Foreign Legislative and Administrative Acts’ in Rüdiger Wolfrum (ed), Max Planck Encyclopedia of Public International Law (OUP 2007) para 18; Berentelg (n 75 Chapter III) 155. 83 See Fonteyne (n 41 Chapter III) 19; Ruffert (n 81 Chapter III) 18; Berentelg (n 75 Chapter III) 158. With regard to the Italian system see Luigi Condorelli, ‘Note’ (1978-1979) Italian Y.B. Int’l L. 164 and Radicati di Brozolo (n 75 Chapter III) 110, who, however, highlight the “abstentionist” attitude of Italian courts as well as other foreign courts to “adopt the most varied reasoning related to avoid passing judgments on the legality of foreign [public] law from the viewpoint of international law” (as per Radicati di Brozolo (ibid) 110-111, footnote 78). According to the author this attitude is well grounded when “there is a lack of consensus on the content of the relevant rules, or where the consequences of the alleged violation thereof are suffered by nationals of a State other than the forum State”.

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eign act is possible only where a sufficient connection with the domestic legal order of the forum State exists: the stronger the violation of the fundamental domestic value or public international law, the lesser the connection with the domestic legal order that is required84. In a last phase, civil law countries distinguish foreign public acts on the basis of their effects. According to this approach, the public organ which acts “can either operate on the basis of a discretionary power to create a new rule that originates a new legal status, or perpetrate a mere formality that is necessary in order to apply a certain rule that establishes this new legal status”85. The public act possesses decisional effects in the first case and substantive effects in the second86. In both cases the administrative act can be adjudicated by foreign courts87. However, this adjudication occurs according to different methods, namely the recognition of foreign judgments or the conflict of laws methods. As such, national courts adjudicate foreign administrative acts with decisional effects according to their internal rules on the recognition and enforcement of foreign judgments and the public acts involved are recognised if they fulfil those requirements88. In contrast, national courts test the validity of foreign administrative acts with substantive effects according to the laws determined by their internal conflict of law rules and the foreign acts involved are deemed to be valid if they were enacted in conformity with the applicable laws to their enactment proceedings, which generally is determined in the law of the enacting state89. In summary, the act of State doctrine of common law countries leads to results similar to the public foreign acts doctrine that is adopted in civil law states. Namely, neither doctrines impedes forum State courts from adjudicating the validity of foreign public acts when this adjudication implies an inquiry into whether the defendant failed to comply with the laws of foreign countries that led to the granting act, and not an examination into the foreign states’ powers to take the act in question.

84

See Berentelg (n 75 Chapter III) 160. “Peut soit créer une norme qui consacre un état de droit, soit accomplir une simple formalité, condition d’application d’une règle de laquelle on déduit cet état de droit”, Pierre Callé, L'acté public en droit international privé (Paris, Economica 2004) 210. See also Mayer (n 74 Chapter III) 17. 86 Mayer (n 74 Chapter III) 17; Callé (n 84 Chapter III) 211. 87 Mayer (n 74 Chapter III) 166; Callé (n 84 Chapter III) 243. 88 Mayer (n 74 Chapter III) 166; Callé (n 84 Chapter III) 243. 89 Mayer (n 74 Chapter III) 166; Callé (n 84 Chapter III) 272. 85

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34. IPRs are not an Expression of the Sovereignty of Foreign Governments The second assumption in favour of the act of state doctrine is also unconvincing, namely, that IPRs are expressions of the national sovereignty of their granting States. When considering IP law from the point of view of the type of IPRs involved, it is possible to distinguish three different periods in IP history90. The earliest period dates back to the systems of royal privileges and continues until the French and UK industrial and illuminist and bourgeois revolutions. In this period merchant corporations created a discipline of unfair competition that aimed to safeguard the interests of the corporate entities and the cities involved, as well as regulate the “signs” of the corporations and their members. During this same period, the “States” created the systems of royal privileges, which were conferred on a citizen by the sovereign on a discretionary basis, with the content of the privilege differing from one to another91. The next notable period in IP history is from the Enlightenment and the French Revolution up until the second half of the 19th century92. During this period the discipline of unfair competition proper of the corporations was aimed at safeguarding only the private interests of the competitors, whereas royal privileges were substituted by exclusive rights, i.e. rights on trademarks, patents and copyrights which are regulated ex ante by the legislators. A third period traces back to the second half of the 19th century and continues until today. Throughout this period, new IPRs have been created, such as designs, plant variety, geographical indications, and the IP systems of the common law and civil law European States have been exported to the entire world – first through colonialism; then as a result of developed countries pushing for such rights in the developing countries; and finally through the US’ trade-based strategy, whereby the trade linkage allowed IP to reach all signatories to the multilateral trading system of the WTO. Since it was initially signed in Marrakesh on 15 April 1994, more than a hundred countries have signed the Final Act Embodying the Results of the Uruguay Round of Multilateral Trade Negotiations in the frame of the WTO, thereby making TRIPs binding on all those who wished to become, or wished to remain, members of the WTO. When considering IP law from the point of view of the competences and of the sources of law93, the first period is distinct because the sovereign had complete discretionary powers over the granting of royal privileges as well as the content of that right. However, with respect to the second and third peri90

See Luigi Carlo Ubertazzi, ‘Introduzione’ in Luigi Carlo Ubertazzi (ed), La proprietà intellettuale (Torino, Giappichelli 2011) 2. 91 Basedow, ‘Foundations of Private International Law’ (n 148 Chapter I) 7. 92 Ibid 7-8, particularly footnote 14 for references. 93 See Ubertazzi (n 89 Chapter III) 3.

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ods, it is possible to distinguish IP history into four different phases. In the first phase States’ laws are the only existing legal source for regulating IPRs, and the effect of those rights is limited to the respective territory of the sovereign granting State, according to the principle of territoriality94. In the second phase, States began entering into bilateral agreements and multilateral conventions which became another important legal source for regulating IPRs. These agreements were entered into on the basis of the reciprocal adjustment between States as codified in the national treatment principle and established, inter alia: a principal of non-discrimination between nationals and foreigners in the regulation of IPRs; a set of minimum rights, partially harmonising the national discipline enacted by States95; international governmental organisations that centralize all or part of the administrative procedures that are necessary for the granting of certain IPRs96; a centralized deposit, reducing the costs of making individual applications or filings in all the countries in which protection is sought, and therefore “making it easier the acquisition of equivalent IPRs on the same subject matter in a number of jurisdictions approximately at the same time”97. In the third phase, international regional organisations such as the EU (European Union), the Council of Europe, the ARIPO (African Regional Intellectual Property Organization), the OAPI (Organisation Africaine de la Propriété Intellectuelle) and the Comunidad Andina become another important legal source for regulating IPRs. These organizations helped to bring about a deeper harmonisation or even uniformization at the regional level of the legal systems of their member States, as well as the creation of supranational IPRs such as the EU trademarks, designs, plant variety and the European Unitary Patent98. In the fourth phase, important NGOs, including academic and practitioner groups, began working on the four sets of Principles99, which are not binding on states, but are nonetheless important legal sources to regulate IPRs100. In sum, States still regulate IPRs, but the role of domestic laws with a pure national focus has been highly reduced in the past years due to the internationalisation of the normative activity in the field of IP. Since international and regional law generally prevails over national law, the ability of each nation State to effectuate national policies with respect to IPRs is increasingly restricted. Furthermore, even though there is an absence of international har94 On the territoriality principle see infra chapter IV. See Basedow, ‘Foundations of Private International Law’ (n 148 Chapter I) 8. 95 On the principle of national treatment see Patry (n 41 Chapter I) 396. 96 See the international conventions supra, at para 5. 97 De Miguel Asensio, ‘Cross-border’ (n 6 Chapter I) 117. See also supra, para 1. 98 See supra, para 5. 99 Ibid. 100 See supra, chapter II.

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monisation of substantive rules on certain IPRs issues, the enactment of laws aimed at harmonisation are usually in the interest of States. Thus, for instance on 16 September 2011 US President Obama signed the Leahy-Smith America Invents Act with the aim of “promot[ing] harmonization of the United States patent system with the patent systems commonly used in nearly all other countries throughout the world with whom the United States conducts trade and thereby [of] promot[ing] greater international uniformity and certainty in the procedures used for securing the exclusive rights of inventors to their discoveries”101. In conclusion, then, applying the act of State doctrine to IPRs because those rights are linked to the sovereign powers and policies of their granting States and therefore constitute expressions of their State sovereignty is not convincing102. The Leahy-Smith America Invents Act, Section 11, available at accessed 30 November 2011. The bill creates several immediate and important changes to US patent law including a moving of the US system from a first to invent system to a first to file system. Also, the new act includes changes “that will increase the pool of ‘prior art’ (i.e. printed publications, patents, and public use and sales activity that can be considered in determining the patentability of an invention)”. See Matt Gibson, ‘President Obama signs off on amendments to Patent Act’ (TipSheet. Intellectual Property Alert, 16 September 2011) available at accessed 30 November 2011, para 1 (article not divided into pages). The new act could pose problems with respect to the IPRs consolidation of claims issue, owing to its rule that “bars plaintiffs from suing multiple defendants in the same suit if the only thing that the defendants have in common is that they are alleged to infringe the same patent(s). Courts will also be barred from consolidating cases involving different defendants according to the same criteria, except that unrelated parties may still be joined for purposes of discovery. This provision applies to all suits filed on or after September 16, 2011”. See Kurth Andrew, ‘United States: The U.S. Has A New Patent Law’ (31 October 2011) available at accessed 30 November 2011. See also ‘Of Immediate Concern: Best Mode and Joinder’ (14 September 2011) at accessed 30 November 2011. 102 See Graeme Dinwoodie, ‘International Intellectual Property Litigation: A Vehicle for Resurgent Comparativist Thought?’ (2001) 49 Am. J. Comp. L. 429; Graeme Dinwoodie, ‘Symposium on Constructing International Intellectual Property Law: The Role of National Courts: The Architecture of the International Intellectual Property System’ (2002) 77 Chicago-Kent Law Review 993; Graeme Dinwoodie, ‘The International Intellectual Property Law System: New Actors, New Institutions, New Sources’ (2006) 10 Marq. I. P. L. Rev. 205. See also Bradley (n 207 Chapter I) 505; Nicolas, ‘The Use of Preclusion Doctrine’ (n 2 Chapter III) 363, quoting relevant US case law according to which “in those cases in which the courts have traditionally invoked the act of state doctrine ‘the crucial acts occurred as a result of a considered policy determination by a government to give effect to its political and public interests[,] matters that would have significant impact on American foreign relations’. In contrast, […] the grant of a patent for floor coverings is merely a ‘ministerial activity’ and thus ‘not the type of sovereign activity that would be of substantial concern to the executive 101

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This conclusion is confirmed by the fact that, even assuming that the IPRs field is grounded on purely national legislative activities, the interests pursued directly by this discipline would be of a private nature and only indirectly of a public character. In fact, European States adopt IP systems that protect directly the private interests in recouping investments and innovation, whereas the public interest in accessing knowledge and fostering progress is only indirectly safeguarded103 by the legislator imposing ex ante limitations on IPRs104, while ex post balance between IPRs and public interests is reduced to a minimal role of the judiciary to be exercised only in the rare cases of conflicts. In contrast, the US system embeds a recognition of IPRs in its Constitution and links those rights directly to the public interests, therefore adopting a utilitarian model that, at least in theory, considers the private properties in light of the public interests: namely allowing the judicial branch to strike an ex post “continuous balance between private and public interest”105 as ruled ex ante by the legislator. Notwithstanding this balanced legal architecture, the US system has witnessed a continuous expansion of IPRs over the last thirty years accompanied by a corresponding reduction of the “fundamental engine of the utilitarian model, i.e. the institutional competition between the judiciary and legislature”106, since the judiciary does not typically reconsider specific choices set forth by the legislator but rather assumes that the enacted rules on IPRs already fulfilled at least indirectly the public interests involved. As a consequence, the US system is shifting “in the de facto or even theoretical direction of a model where the main purpose of IPRs is to protect private interests and to compensate authors and inventors for their sweat-of-the-brow, ultimately converging toward an imported” proprietary model107. 35. Relevant Judgments The conclusion that the act of State doctrine should not apply to IPRs is acknowledged not only by the majority of the scholars and their initiatives such as the four sets of Principles, but also by several important judgments.

branch in its conduct of international affairs”. The same conclusion is reached in relation to copyright by Graeme Dinwoodie, ‘Conflicts and International Copyright Litigation: the Role of International Norms’ in Basedow, Drexl, Kur and Metzger (n 209 Chapter I) and in relation to IPRs in general by de Miguel Asensio, ‘Cross-border’ (n 6 Chapter I) 105. 103 See Christophe Geiger, ‘“Constitutionalising” Intellectual Property Law? The Influence of Fundamental Rights on Intellectual Property in the European Union’ (2006) 37(4) IIC 381, in relation to copyrights. See also Ottolia (n 292 Chapter I) 143. 104 Ottolia (n 292 Chapter I) 143. 105 Ibid. 106 Ibid 22. 107 See throughout Ottolia (ibid) for a criticism of this shift towards a proprietary model, as well as for possible solutions thereto.

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Among those judgments is the Mannington Mills of 3 April 1979108 ruling. In this case, the Court held that the act of State doctrine did not prevent it from examining the validity of the foreign patents because its judgment would not effect American foreign relations, and the Court further maintained that the grant of a patent is merely a “ministerial activity”109 and thus “not” the “type of sovereign activity”110 that would justify the application of the act of [S]tate doctrine111. Other decisions have considered that proceedings related to the validity of a foreign IPR do not challenge the government’s power to grant the right, but rather inquire into whether the defendant failed to comply with its laws on the granting of the IPR involved. In Forbo-Giubiasco of 24 June 1981112, the US District Court for the Southern District of New York maintained that resolving a dispute over foreign patent rights does not implicate the act of State doctrine because the court is not examining the power of the foreign state to grant the patent, but rather is inquiring into whether the defendant “failed to comply with the laws of foreign countries”113. More recently, in Monolithic Power Systems of 18 October 2006114 a California district court emphasised that “under the act-of-[S]tate doctrine, an action will be barred only if an official act of a foreign sovereign was performed within its own territory and the relief sought or the defence interposed in the action would require a federal court to declare invalid that official act”115. In contrast, the act of state doctrine does not apply where “sovereign activity merely formed the background to the dispute or in which the only governmental actions were the neutral application of the laws”116. Since the granting of patents does not concern a sovereign activity, but rather only governmental

108

Mannington Mills, Inc. v Congoleum Corp. 595 F.2d 1287 (1979). On this case see Toraya (n 23 Chapter III) 1180; Nicolas, ‘The Use of Preclusion Doctrine’ (n2 Chapter III) 363. 109 Mannington Mills (n 107 Chapter III) 1294. 110 Ibid. 111 Ibid 1293-1294, according to which “we are unable to accept the proposition that the mereissuance of patents by a foreign power constitutes […] an act of state”. 112 Forbo-Giubiasco S.A. v Congeleum Corp. 516 F.Supp. 1210 (S.D.N.Y. 1981). On this case see Toraya (n 23 Chapter III) 1180; Nicolas, ‘The Use of Preclusion Doctrine’ (n 2 Chapter III) 364. 113 Forbo-Giubiasco (n 111 Chapter III) 1217. 114 Monolithic Power Systems Inc. v 02 Micro International Ltd., unreported case, 2006 U.S. Dist. LEXIS 78601. 115 Ibid 18. 116 Ibid 18, citing Clayco Petroleum Corp. v Occidental Petroleum Corp. 712 F.2d 404, 406 (9th Cir. 1983).

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actions that are neutral application of the laws, “the mere issuance of patents by a foreign power’ does not constitute ‘an act of state’”117. Finally, it is also relevant to address Judge Newman’s dissenting opinion in the Voda judgment, in which he rejects the theory supported by the panel majority “that the grant of a foreign patent is a governmental act of state, and thereby untouchable by a United States court”118. Instead, Judge Newman argues that “patent validity and infringement are legal and commercial issues, not acts of [S]tate”119, and therefore “the Act of [S]tate doctrine is not relevant to judicial review of the Voda foreign patents”120. Paradoxically, a similar conclusion can also be found among certain judgments that link IPRs to the policy of their granting state and that purport the existence of exclusive jurisdiction rules with respect to IPRs. In fact, in the Lucasfilm case, while the UK Supreme Court’s ruling emphasises that the act of State doctrine does not apply to IPRs in the UK121, the reversed decision of the UK Court of Appeal’s decision122 highlights that “it is really rather artificial to say that questioning the validity of a registered right is somehow impugning the powers of a sovereign state. The grant of registered IP rights is governed by laws. All one is doing when challenging validity is to say that the right was wrongly granted according to law. Sovereignty in any realistic sense does not come into it”123. Moreover, the Court stated that “there are in principle two sorts of registered rights – those granted after examination and those granted by mere registration. […] Is mere administrative process of registration a ‘sovereign act’?”124. The UK Court of Appeal’s Lucasfilm judgment then goes even further, clarifying that “of course a foreign court cannot make an order expunging a registered right from the register of a particular country”, but “that makes no real difference” in actual practice: “[f]or it is generally a defence to a claim for infringement that the right relied upon is invalid – whether any registration of the right is subsequently cancelled is essentially beside the point as far as a defendant is concerned”125.

117

Monolithic Power Systems (n 113 Chapter III) 19, citing Mannington Mills (n 107 Chapter III). 118 Voda (n 31 Chapter I) 914. See Austin, ‘The Concept of "Justiciability"’ (n 29 Chapter I) 412, recalling “the powerful dissent by Judge Pauline Newman in Voda, which contains mch careful and insightful analysis as to the proper approach to the actionability of foreign intellectual property infringement in the international context”. 119 Voda (n 31 Chapter I) 915. 120 Ibid. 121 See supra, para 31. 122 See supra, paras 1 and 3. 123 Lucasfilm Entertainment (n 29 Chapter I) 181(iv). 124 Ibid. 125 Ibid.

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In the Gallo judgment126 the Supreme Court of Appeal of the Republic of South Africa highlights that there is no difference between registered IPRs which require administrative intervention for protection and unregistered rights, such as copyrights, which exist naturally by virtue of local legislation. According to the Court, the administrative intervention related to registered IPRs is not an expression of the sovereignty of the State involved but rather is a mere “bureaucratic act” adopted “by administrative staff”127, such as “the grant of a trading licence”128.

IV. Theses According to which Comity Implicitly Poses Exclusive Jurisdiction Rules IV. Theses according to which Comity Implicitly Poses 36. Theses According to which Comity Establishes Implicit Exclusive Jurisdiction Rules: the Voda and the UK Court of Appeal’s Lucasfilm Judgments In addition to the act of State doctrine, comity is also adopted by important judgments of the common law countries to ground exclusive jurisdiction rules in IPRs cases. Among those judgments are the Voda, the UK Court of Appeal’s Lucasfilm and the Gallo judgments. In the Voda case the US Court of Appeals for the Federal Circuit highlights that “comity refers to the spirit of cooperation in which a domestic tribunal approaches the resolution of cases touching the laws and interests of other sovereign states”129. The court then specifies the definition of comity. The Court quotes the Hilton judgment130 according to which “comity, in the legal sense, is neither a matter of absolute obligation, on the one hand, nor mere courtesy and good will, upon the other. But it is the recognition which one nation allows within its territory to the legislative, executive or judicial acts of another nation, having due regard both to international duty and convenience, and to the rights of its own citizens or of other persons who are under the protection of its laws”131. Using this quote, the Court in the Voda case identifies the following considerations which guide the court’s determination of whether an exercise of comity supports extending or declining jurisdiction over foreign patent in126

See supra, paras 1 and 3. Gallo (n 28 Chapter I) 21. 128 Ibid. 129 Voda (n 31 Chapter I) 900, quoting Societé Nationale Industrielle Aérospatiale v U.S. Sist. Court for the S.D. of Iowa 482 U.S. 522, 543 n. 27 (1987), which was quoting Hilton v Guyot 159 U.S. 113 (1895). 130 Hilton (ibid). See Tyshow (n 34 Chapter I) 288-289; Nicolas, ‘The Use of Preclusion Doctrine’ (n 2 Chapter III) 365; Calamita (n 35 Chapter I) 624. 131 Voda (n 31 Chapter I) 900 quoting Hilton (n 128 Chapter III). 127

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fringement claims132: whether an international duty to adjudicate foreign patent infringement claims exists; whether this adjudication would be convenient; and whether it would be necessary to protect the rights of the US citizens or of other persons who are under the protection of US laws133. As for the international duty, the court maintains that “Voda has not identified any international duty, and we have found none, that would require our judicial system to adjudicate foreign patent infringement claims”134, since neither the CUP, nor the CUB and TRIPs agreement135 contemplate one jurisdiction to adjudicate the patent of another. As for the reasons of convenience, the court highlights that “assuming jurisdiction over Voda’s foreign patent infringement claims could prejudice the rights of foreign governments” for the following reasons. The first is that the governments of the foreign countries where the relevant patents are registered – namely Britain, Canada, France, and Germany – are not “willing to have our courts exercise jurisdiction over infringement claims based on their patents”136. The second is that the exercise of jurisdiction over Voda’s foreign patents claims could violate the local action doctrine, which prevents courts from adjudicating claims for trespass or title to foreign real property in order to safeguard the sovereignty of foreign states137, and the Court argues that this also applies to IPRs since “the territorial limits of the rights granted by patents are similar to those conferred by land grants” given that “a patent right to exclude only arises from the legal right granted and recognised by the sovereign within whose territory the right is located”138. Third is that, given the complexity of the patents and laws that govern them, the “foreign sovereigns at issue in this case have established specific judges, resources, and procedures to ‘help assure the integrity and consistency of the application of their patent laws’ [and] therefore, exercising jurisdiction over such subject matter could disrupt their foreign procedures”139. As for the rights of US citizens, the US Court of Appeals for the Federal Circuit maintains that “with respect to the rights of our citizens, Voda has not shown that foreign courts will inadequately protect his foreign patent rights. Indeed, we see no reason why American courts should supplant British, Ca132

Voda (n 31 Chapter I) 901-902. Azar (n 38 Chapter I), according to whom comity “is a balance between recognition and consideration for other nations’ sovereignty and the host nation’s citizens’ rights”. 134 Voda (n 31 Chapter I) 901. 135 See supra, para 5. 136 Voda (n 31 Chapter I) 901. 137 See infra, para 67. 138 Voda (n 31 Chapter I) 901, according to which “it would be incongruent to allow the sovereign power of one to be infringed or limited by another sovereign’s extension of its jurisdiction”. 139 Voda (n 31 Chapter I) 902-903. 133

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nadian, French, or German courts in interpreting and enforcing British, Canadian, French, or German patents”140. In the Lucasfilm Court of Appeals case, the UK Court141 applies the comity doctrine to decline jurisdiction over the foreign copyright infringement claim at stake. The Lucasfilm judgment first quotes the parts of the Voda judgment related to “comity and relations between sovereigns”142. Moreover, the court maintains that “all of the other considerations which we have mentioned and which led the Court of Appeals in Voda to decline jurisdiction over foreign patent claims apply equally to enforcement of a foreign copyright here”143. Among those considerations are the ones relating to comity. Additionally, the Court looked into the existence of an international duty and into the reasons of convenience for adjudicating a foreign copyright infringement claim, both of which are constitutive elements of comity. With respect to an international duty, the Court maintains that international agreements concerning copyright have refrained from putting in place a regime for the international litigation of copyrights by the courts of a single State: “a system of mutual recognition of copyright jurisdiction and of copyright judgments could have been created but it has not – a point noted by the Court in Voda”144. As for the reasons of convenience, the court emphasises the analogy between tangible properties and IPRs. The court referred to the rules derived from “the principle of non-justiciability for claims concerning foreign land, established over a century ago in the Moçambique case”145, highlighting that “infringement of an IP right (especially copyright, which is largely unharmonised) is essentially a local matter involving local policies and local public interest. It is a matter for local judges”146. The Court also maintains that IPRs are expressions of their granting state’s domestic policies, and therefore the adjudication and enforcement of foreign IPRs “may involve a clash of the IP policies of different countries”147. Therefore, the Court concludes that “for sound policy reasons the supposed international jurisdiction over copyright infringement claims does not exist”148. In the Gallo case, the South African Court never adopts the word “comity”. However, the Court looks into both whether an international duty exists 140

Voda (n 31 Chapter I) 901. Which was reversed by Lucasfilm Ltd. & Ors v Ainsworth & Anor in the UK Supreme Court (n 30 Chapter I), see supra paras 1 and 3. 142 Lucasfilm Entertainment (n 29 Chapter I) 168. See also paras 169-170. 143 Ibid 180. 144 Ibid 178. 145 On the Moçambique rule see infra, para 67. 146 Lucasfilm Entertainment (n 29 Chapter I) 178. 147 Ibid 176. 148 Ibid 183. 141

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and the reasons of convenience for adjudicating a foreign copyright infringement claim, both of which are constitutive elements of comity. As for an international duty, the South African Court again quotes the UK Court of Appeal’s Lucasfilm judgment149 according to which “‘it is quite clear that those concerned with international agreements about copyright have refrained from putting in place a regime for the international litigation of copyrights by the courts of a single state. […] A system of mutual recognition of copyright jurisdiction and of copyright judgments could have been created but it has not’”150. As for the reasons of convenience, the South African Court quotes the UK Court of Appeal’s Lucasfilm judgment151 emphasising that “the court in Lucasfilm […] was able to justify its conclusion not only on principle but also on the grounds of convenience and common sense. […] These considerations include the fact that enforcement may involve a clash of the IP policies of different countries; that extra-territorial jurisdiction involves a restraint on actions in another country – an interference which prima facie a foreign judge should avoid”152. 37. Other Relevant Judgments The Voda, Lucasfim and Gallo judgments mentioned above are in line with other judgments that adopt comity to prevent courts from adjudicating foreign IPRs validity and infringement issues. In the majority of cases the comity doctrine is applied more generally, without any strict analysis of each of the considerations of international duty, convenience, and rights of its own citizens and in some cases without any analysis at all. Of particular note among these judgments are the following. In Canadian Filters of 9 June 1969153 the United States Court of Appeals for the First Circuit heard a declaratory action for the invalidity and non-infringement of United States and Canadian patents. In this case, the plaintiff moved to enjoin the patent holder’s Canadian suit for infringement of a Canadian patent and the patent holder moved to dismiss the portion of complaint based on its Canadian patent. The Court stated that “[d]oubtless there are times when comity, a blend of courtesy and expedience, must give way [….]. However, these ex-

149

Which, however, was reversed by the UK Supreme Court in Lucasfilm Ltd. & Ors v Ainsworth & Anor (n 30 Chapter I), see supra paras 1 and 3. 150 Gallo (n 28 Chapter I) 25. 151 Which, however, was overturned by Lucasfilm Ltd. & Ors v Ainsworth & Anor (n 30 Chapter I), see supra paras 1 and 3. 152 Gallo (n 28 Chapter I) 25. 153 Canadian Filters (Harwich) Ltd. v Lear-Siegler, Inc. 412 F.2d 577 (1st Cir. 1969). On this case see Caldwell (n 23 Chapter III) 201; Nicolas, ‘The Use of Preclusion Doctrine’ (n 2 Chapter III) 360.

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ceptions do not apply to this case where the subject matter of the foreign suit is a separate, independent foreign patent right”154. In Packard Instrument of 21 July 1972155 the US District Court for the Northern District of Illinois established that “serious questions of comity”156 prevented the court from determining invalidity of foreign patents issued in nine jurisdictions. In Mars of 10 June 1993157 the US District Court for the District of Delaware cited Vanity Fair158 to dismiss an infringement action based on Japanese patent law out “of consideration of international comity and respect for national integrity”159. The Federal Circuit then affirmed this decision160, stating that “general concerns of international comity counsel against exercising jurisdiction over a matter involving a Japanese patent, Japanese law, and acts of a Japanese defendant in Japan”161. In Berkshire Furniture of 13 December 1995162 the United States District Court for the Western District of Kentucky recalled the above statements from the Mars decision, and dismissed the case in which the plaintiff sought “to adjudicate the validity of a design registration issued in Malaysia and enjoin the defendants from enforcing their alleged rights to the designs in a Malaysian court”163. In Ideal Instruments of 8 of May 2006164 the United States District Court for the Northern District of Iowa found “that the question of its jurisdiction over Ideal’s claim for a declaratory judgment of non-infringement of Rivard Instruments’s foreign patent is guided, indeed controlled, by the decision of the Federal Circuit Court of Appeal in Mars”165 and particularly by the parts of this decision related to comity. In S. Megga Telecommunications of 14 February 1997166 the US District Court for the District of Delaware considered “comity” as part of its forum non conveniens analysis and found that “as the Mars court recognized, […] 154

Canadian Filters (n 152 Chapter III) 578-579. Packard Instrument (n 25 Chapter III). On this case see Nicolas, ‘The Use of Preclusion Doctrine’ (n 2 Chapter III) 361. 156 Packard Instrument (n 25 Chapter III) 410. 157 Mars, Inc. v Kabushiki-Kaisha Nippon Conlux 825 F.Supp. 73 (D. Del. 1993), 24 F.3d 1368 (Fed. Cir. 1994). 158 See supra, para 31. 159 Mars (n 156 Chapter III) 76. 160 Ibid 1368. 161 Ibid 1376. 162 Berkshire Furniture (n 28 Chapter III). 163 Ibid 1559. 164 Ideal Instruments v Rivard Instruments 434 F.Supp.2d 598 (N.D. Iw. 2006). 165 Ibid 629. 166 S. Megga Telecommunications Ltd. v Lucent Technologies, Inc., case unreported, 1997 U.S. Dist. LEXIS 2312. 155

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‘general concerns respecting international comity counsel against exercising jurisdiction over matters involving’ Chinese intellectual property law”167. Additionally, other judgments in relation to the exercise of jurisdiction in cases concerning foreign IPRs address the considerations typical of the comity doctrine, namely international duty, the reasons of convenience and the rights of their own citizens. While these considerations are not specifically addressed as part of a comity assay, the analysis of the courts with respect to the individual elements is still relevant to the comity analysis and will be examined by the following remarks. As for the consideration of international duty, the following judgments are relevant. In Ortman v Stanray of 3 January 1967168 the US Court of Appeals for the Seventh Circuit found that it had no international duty to adjudicate a case related to the infringement of foreign patents because the CUP does not provide a basis for jurisdiction thereof169. In Stein Assoc’s of 16 November 1984170 the US Court of Appeals for the Federal Circuit found that it had no international duty to adjudicate a case related to the infringement of a British patent, since the independence of the patents of signatory countries, as set forth in Article 4.bis of the Paris Convention implies that “[o]nly a British court, applying British law, can determine validity and infringement of British patents. British law being different from our own, and British and United States courts being independent of each other”171. In Fairchild Semiconductor of 10 December 2008172 the US District Court for the District of Maine cited Voda for the proposition that “there is no international duty for a US Court to adjudicate the Chinese patent”173. As regards the consideration of convenience, the following judgments are relevant. The already mentioned Canadian Filters, Packard Instrument, Mars, Berkshire, Ideal Instruments and S. Megga Telecommunications174 judgments maintain that the adjudication of foreign IPRs cases prejudices foreign governments’ rights and interests and therefore should be avoided, as already highlighted175. Moreover, in the oft-cited Vanity Fair judgment176 the United States Court of Appeals for the Second Circuit refused to address a claim 167

Ibid 43-44, citing Mars (n 156 Chapter III). Ortman v Stanray Corp. 317 F.2d 154 (7th Cir. 1967). On this case see Toraya (n23 Chapter III) 1175; Caldwell (n 23 Chapter III) 196. 169 Ortman (n 167 Chapter III) 157. 170 Stein Assoc’s, Inc. v Heat and Control, Inc. 748 F.2d 653 (Fed Cir. 1984). 171 Ibid 658. 172 See supra, para 31. 173 Fairchild Semiconductor (n 39 Chapter III) 96. On this case see Dessemontet, ‘The ALI Principles’ (n 20 Chapter I) 37 footnote 9. 174 See those judgments at para 31 and at this same para. 175 See supra, this same para. 176 See supra, para 31. 168

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where the validity of a Canadian trademark was raised, stating that “were this merely a transitory action in which disputed facts could be litigated as conveniently here as in Canada, we would think the jurisdiction of the district court should be exercised. But we do not think it the province of United States district courts to determine the validity of trade-marks which officials of foreign countries have seen fit to grant. To do so would be to welcome conflicts with the administrative and judicial officers of the Dominion of Canada”177. 38. The Applicability of Comity to Unregistered IPRs As for unregistered IPRs, both the UK Court of Appeal’s Lucasfilm ruling and South Africa’s Gallo judgments extended comity to copyrights178. In contrast, the UK Supreme Court’s 27 July 2011 Lucasfilm ruling reversed the UK Court of Appeal’s judgment179, and explicitly excluded the application of comity to unregistered IPRs claims. Particularly, the UK Supreme Court’s Lucasfilm ruling contrasts the points relied on by the Court of Appeal to justify the application of the local action doctrine posed by the Moçambique rule180 to the comity analysis and thus to the adoption of exclusive jurisdiction rules in favour of the granting State’s court with respect to national IPRs claims. The relevant passage of the Supreme Court’s Lucasfilm ruling warrants quotation in full. According to the Supreme Court, “the basis for what remains of the rule was said by the House of Lords in the Moçambique case to be that controversies should be decided in the country of the situs of the property because the right of granting it was vested in ‘the ruler of the country’ and in the Hesperides case to be the maintenance of comity and the avoidance of conflict with foreign jurisdictions. It is possible to see how the rationale of the Moçambique rule can be applied to patents, at any rate where questions of validity are involved. For example the claims might touch on the validity of patents in sensitive areas, such as armaments, and that no doubt is part of the rationale for Article 22(4) of the Brussels I Regulation. But it is very difficult to see how it could apply to copyright. It is evident that copyright can involve delicate political issues. Thus in a very different context Brightman J had to 177

Vanity Fair (n 23 Chapter III) 647. With respect to protecting the rights of US citizens, a parallel analysis can be found in cases applying the forum non conveniens doctrine to dismiss foreign IPRs claims, which is addressed in chapter VI of this book. At the outset of the forum non conveniens analysis, a court must find that an adequate alternative forum exists before it can dismiss a foreign claim under this doctrine. This factor is analogous to the comity consideration of whether the rights of US citizens will be protected in a foreign court, because both look to whether the claimant’s rights will be adequately protected in the foreign forum and prevent dismissal if such rights will not be protected. 178 On those judgments see supra, paras 1 and 3. 179 Ibid. 180 See infra, para 67.

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deal with the international consequences for copyright protection of the samizdat circulation in the Soviet Union of Solzhenitsyn's August 1914 without having been passed by the Soviet censor: Bodley Head Ltd v Flegon [1972] 1 WLR 680. But such cases can be dealt with by an application of the principles of public policy in appropriate cases”181. Also, the Court emphasises that “there are no issues of policy which militate against the enforcement of foreign copyright. States have an interest in the international recognition and enforcement of their copyrights, as the Berne Convention on the International Union for the Protection of Literary and Artistic Works shows. Many of the points relied on by the Court of Appeal to justify the application of the Moçambique rule in this case as a matter of policy would apply to many international cases over which the English court would have jurisdiction and would in principle exercise it, especially the suggestion that questions of foreign law would have to be decided. It was also said by the Court of Appeal that enforcement of foreign intellectual property law might involve a clash of policies such that a defendant may be restrained by injunction from doing acts in this country which are lawful in this country. But such an injunction will be granted only if the acts are anticipated to achieve fruition in another country, and there is no objection in principle to such an injunction. Nor is there any objection in principle, as the Court of Appeal thought, to a restraint on acts in another country. Extra-territorial injunctions are commonly granted here against defendants subject to the in personam jurisdiction”182. In the US system, there is case law which holds that comity does not require courts to refuse jurisdiction with respect to foreign unregistered IPRs claims. These cases are the already referred to cases in which US Courts exercised jurisdiction over foreign copyright claims and did not dismiss the foreign copyright claim for lack of jurisdiction183. In contrast, in ITSI T.V. Productions of 2 March 1992184 the US District Court for the Eastern District of California argued that, despite the London Films case, there was no clear authority for exercising such jurisdiction and “[m]oreover, it appears to me […] that American courts should be reluctant to enter the bramble bush of ascertaining and applying foreign law without an urgent reason to do so”185. However, Armstrong v Virgin Records of 3 April 2000186 seeks to distinguish this case, noting that while certain courts have, at times, demonstrated 181

Lucasfilm Ltd & Ors v Ainsworth & Anor (n 30 Chapter I) 109. Ibid 110. 183 See supra, para 32. 184 ITSI T.V. Productions, Inc. v California Authority of Racing Fairs, et al., 785 F.Supp. 854 (E.D. Ca. 1992). 185 Ibid 866. 186 Armstrong v Virgin Records, Ltd. 91 F.Supp. 2d 628 (S.D.N.Y. 2000). 182

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their reluctance to adjudicate foreign copyright infringements, there is no principled reason to bar, in absolute fashion, copyright claims brought under foreign law for lack of subject matter jurisdiction, and furthermore “a number of persuasive authorities and commentators have also indicated that the exercise of subject matter jurisdiction is appropriate in cases of transnational copyright infringement”187. Finally, the decision in Voda can be read consistently with this approach. Thus, unlike the UK Court of Appeal’s Lucasfilm ruling and the Gallo judgment, Voda did not explicitly address whether its reasoning would extend to other types of IPRs, including unregistered rights. While the Lucasfilm and Gallo judgments clearly read Voda to apply equally to unregistered rights, their reading of Voda is unconvincing. By way of explaining the relevance of the local action doctrine to the comity analysis, the Voda majority stated that the “patent right to exclude only arises from the legal right granted and recognized by the sovereign within whose territory the right is located”188. The same is not true of copyrights, or other unregistered IPRs, which receive protection without any “sovereign” act.

V. Comity does not Pose Exclusive Jurisdiction Rules V. Comity does not Pose Exclusive Jurisdiction Rules 39. Assuming Jurisdiction over Foreign IPRs Claims is Imposed by Public International Law, Referral The first argument in support of the application of comity in foreign IPRs cases, namely the absence of an international duty that would require national judicial systems to adjudicate foreign IPRs claims, is not convincing. In fact, even if it is true that the CUP, CUB, and TRIPs agreement do not contemplate international jurisdiction rules, the parties to those treaties are not only not restrained from exercising their jurisdiction in relation to foreign IPRs by reason of the absence of a rule on the point in the treaties, but are actually obliged to exercise their jurisdiction for the following reasons. States are not restrained from exercising their jurisdiction in relation to foreign IPRs because, according to general public international law, a State’s exercise of jurisdiction inside its borders is free from any restrictions whatsoever, as will be addressed in depth in the last paragraph of this chapter. Also, under a general principle of public international law “restrictions upon the independence of States cannot therefore be presumed”189, and therefore 187

Ibid 637. Voda (n 31 Chapter I) 901. 189 See the Lotus Case (n 3 Chapter II) 18, available at accessed 30 November 2011. On this principle see Jef188

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the silence of the CUP, CUB, and TRIPs agreement on the international jurisdiction issues cannot be presumed to be an (implicit) exclusive jurisdiction rule. Furthermore, the States are even obliged to exercise their jurisdiction with respect to foreign IPRs cases since, as will be addressed in depth at the last paragraph of this chapter, as well as at chapter VI, the dismissing of a case under the comity doctrine violates the public international law rules on the right of access to a court. 40. Assuming Jurisdiction over Foreign IPRs Claims does not Prejudice the Rights of Foreign Governments The second argument in support of the application of comity in foreign IPRs cases, namely the reasons of convenience, also fails to convince. First, as for possible prejudice to the rights of foreign governments by the exercise of jurisdiction by states over foreign IPRs, a State’s exercise of jurisdiction inside its borders is free from any restrictions whatsoever, under general public international law, and therefore does not prejudice the rights of foreign governments. This is confirmed also by the simple fact that the foreign governments in question can eventually avoid recognising and executing the decision of the State that exercised its jurisdiction over their IPRs claims, although States shall recognise and enforce foreign judgments concerning IPRs registered in that foreign country, even if those judgments imply an amendment of their national registries, save in very limited cases on the basis of a public policy exception190. Second, as for the local action doctrine as an element of the comity rationale, its extension to IPRs cases is not convincing, as will be addressed in chapter V of this book191. Third, as for the statements that “infringement of an IP right […] is essentially a local matter involving local policies and local public interest” and “a matter for local judges”192 and that adjudicating foreign IPRs “may involve a clash of the IP policies of different countries”193, the following remarks are frey Dunoff and Joel Trachtman, ‘The Lotus Eaters’ (EJIL: Talk!, 16 July 2010) available at accessed 30 November 2011. On the Lotus case see infra, para 42. See Shaw (n 2 Chapter II) 581. See also generally on the Lotus case George Berge, ‘The Case of the S. S. “Lotus”’ (1928) 26(4) Mich. L. Rev. 361-382; Hugh Handeyside, ‘The Lotus Principle in ICJ Jurisprudence: Was The Ship Ever Afloat?’ (2007) 29 Mich. J. Int’l L. 71, available at accessed 30 November 2011. 190 See infra, paras 73 and 75. 191 See infra, para 67. 192 Lucasfilm Entertainment (n 29 Chapter I) 175. 193 Ibid 176.

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relevant. The current harmonization of the procedural and substantive laws for IPRs implies that IP laws should no longer be considered expressions of different national policies194, and therefore the exercise of jurisdiction by one State over foreign IPRs does not imply “a clash of the IP policies of different countries”195. Copyright, therefore, cannot be considered a “largely unharmonised”196 field. Even if a clash of the IP policies of different countries existed, this clash would in no way differ from the clash that arises generally with respect to proceedings before national courts that would be adjudicated according to a foreign law, especially in fields that are largely unharmonised such as the personal status field and where so-called “civilisation conflicts”197 occur: yet, those clashes and civilisation conflicts do not impede the exercise of in194

See supra, para 34. Lucasfilm Entertainment (n 29 Chapter I) 176. 196 Ibid 175. 197 See Louis Milliot, ‘Le statut personnel des musulmans algériens. Difficultés de son application sur le territoire français de la métropole’ in Jacques Maury, Mélanges offerts à Jacques Maury (Vol. I, Paris, Dalloz 1960) 309–319; Norman Anderson, ‘A Law of Personal Status for Iraq’ [1960] Int’l & Comp. L. Q. 542–563; István Szaszy, ‘Le conflit de lois interpersonnel dans les pays en voie de développement’ (1973-I) 138 Recueil des Cours 81–201; Pierre Bourel, ‘Réalités et perspectives du droit international privé de l’Afrique noire francophone dans le domaine des conflits de lois’ [1975] JDI 17–44; Salah El Dine Tarazi, ‘La solution des problèmes de statut personnel dans le droit des pays arabes et africains’ (1978-I) 159 Recueil des Cours 345–463; Mohamed Charfi, ‘L’influence de la religion dans le droit international privé des pays musulmans’ (1987-III) 203 Recueil des Cours 321–454; Pierre Gannagé, ‘La coexistence des droits confessionnels et des droits laïcisés dans les relations privées internationales’ (1979-III) 164 Recueil des Cours 339–423; François Boulanger, ‘Essai comparatif sur la notion de statut personnel dans les relations internationales des pays d’Afrique noire’ [1982] RCDIP 647–668; Pierre Gannagé, ‘Droit intercommunautaire et droit international privé. A propos de l’évolution du droit libanais face aux droits proche–orientaux’ [1983] JDI 479–508; Pierre Gannagé, ‘Observations sur la codification du droit international privé dans les Etats de la Ligue arabe’ in Le droit international à l’heure de sa codification: études en l’honneur de Roberto Ago (Milano, Giuffrè 1987) 105–123; Ann Elizabeth Mayer, ‘Law and Religion in the Muslim Middle East’ [1987] Am. J. Comp. L. 127–184; Jean Dépres, ‘Droit international privé et conflits de civilisations. Aspects méthodologiques. Les relations entre systèmes d’Europe occidentale et systèmes islamiques en matière de statut personnel’ (1988-IV) 211 Recueil des Cours 9–372; Akolda Tier, ‘Conflict of Laws and Legal Pluralism in the Sudan’ [1990] Int’l & Comp. L. Q. 611–640; Jamal Nasir, The Islamic Law of Personal Status (2nd edn, London, Kluwer 1990); Abd-el-Kader Boye, ‘Le statut personnel dans le droit international privé des pays africains au sud du Sahara. Conceptions et solutions des conflits de lois. Le poids de la tradition négro–africaine personnaliste’ (1993-I) 238 Recueil des Cours 247–419; Pierre Gannagé, ‘Les Sociétés multicommunautaires face a l’évolution du droit international privé de la famille’ (1996-1997) Travaux du comité français de droit international privé 297–317; Florence Laroche-Gisserot, ‘L’échec du mariage occidental en Afrique Francophone: l’exemple de la Côte D’Ivoire’ (1999) RIDC 53–84; Kurt Siehr, ‘Coordination of Legal Systems in Private International Law’ in Talia Einhorn and Kurt Siehr (eds), Essays in Memory of Peter E. Nygh (Asser Press 2004) 325–337. 195

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ternational jurisdiction, but rather are generally dealt with by (the limited) recourse to the public policy exception198. With particular regard to copyright, this is the conclusion reached by the UK Supreme Court’s in its Lucasfilm decision199. The same conclusion seems then to apply also to registered IPRs, except where the validity “claims might touch on the validity of patents in sensitive areas, such as armaments”200. The approach here suggested is confirmed by the circumstance that even if a clash in the IPRs cross-border litigation existed and was actually deeper than the one proper of other fields of law, the exercise of international jurisdiction over foreign IPRs would still not be impeded since under general public international law a State’s exercise of jurisdiction inside its borders cannot prejudice the rights of foreign governments201, and a State’s declining of jurisdiction under exclusive jurisdiction rules implies a denial of justice and is contrary to the human right of access to a court202. Fourth, as for the argument that the exercise of jurisdiction over foreign IPRs would risk an unreasonable interference with the sovereign authority of other nations, disrupting their specialized systems of IPRs protection203 established in light of the complexities of the IPRs substantive laws, it is relevant to mention the following. IPRs are not an expression of the sovereign authority of their granting states but rather are private rights204. Moreover, all the reasons disputing the complexity in the application of foreign IPRs law just highlighted are extendable to support the conclusion that such complexities are not an argument that can be adducted in support of exclusive jurisdiction rules205. 41. Assuming Jurisdiction over Foreign IPRs Claims Corresponds to the Citizens’ Interests The third argument in support of the application of comity in IPRs cases, namely the absence of the citizens’ interests in having their cases dealt with by the forum State courts, does not convince. First, since this argument favours only citizens, it is contrary to the national treatment principle established by the CUP, CUB, and TRIPs agreement206. Second, citizens do have 198

See paras 71 and 73. Lucasfilm Ltd & Ors v Ainsworth & Anor (n 30 Chapter I) 107, of which see the full quotation at para 38. 200 Ibid 106. 201 See supra, this same para. 202 See supra, this same para and chapter V. 203 Namely, “specific judges, resources, and procedures”, see Voda (n 31 Chapter I) 902. 204 See supra, para 34. 205 See infra, para 71. 206 See supra, para 34. 199

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an interest in having their cases dealt with at home because of the inadequate protection that could be offered them abroad in certain circumstances. In fact, exclusive jurisdiction rules grounded on comity reasons require citizens to duplicate their proceedings207, whereas the duplication of proceedings in IPR cases has been shown to significantly increase costs and can lead to divergent outcomes208, therefore meeting the requirement of the inadequate protection of the citizens abroad. Thus, according to the comity doctrine, it is necessary not to apply it and rather to exercise jurisdiction.

VI. The Act of State Doctrine and Comity are Contrary to Public International Law VI. The Act of State Doctrine and Comity are Contrary 42. The Act of State and Comity are not Suggested by Public International Law The previous paragraphs examined the reasons against the first sets of arguments explicitly invoked in support of the extension to IPRs cases of the act of State and comity doctrines, respectively. The following remarks analyse the underlying argument that is adopted in favour of both the act of State doctrine and comity, and conclude that it does not convince. As already noted, it has been argued that extending the act of State and comity to IPRs is suggested by public international law209. However, public international law does not limit a State’s exercise of jurisdiction inside its borders, as was stated by the Permanent Court of Justice in the Lotus judgment of 1927210, according to which a State’s legislative jurisdiction is free from any restrictions whatever under international law211. Therefore, in a pure sense, public international law does not wholly and inherently support the application of the act of State doctrine and comity. In this case the French mail steamer, Lotus, collided with the Turkish collier, Boz-Kourt, on the high seas. The collision cut the Turkish Boz-Kourt in two, causing it to sink and eight Turkish nationals to perish. Once the Lotus arrived in Constantinople, the Turkish authorities arrested its Lieutenant and started criminal proceedings against him “on a charge of manslaughter”212. This exercise of jurisdiction by Turkey gave rise to many diplomatic representations on the part of France, and subsequently the two States agreed to 207

On the notion of duplication of proceedings see supra, para 5. As will be demonstrated in chapter VI of this book. 209 See supra, para 29. 210 See supra, para 40. 211 Ibid. 212 Lotus Case (n 3 Chapter II) 11. 208

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submit the case to the Permanent Court of International Justice (PCIJ). The Court was asked to establish whether Turkey had violated a principle of public international law by exercising its jurisdiction over a French citizen in a criminal proceeding related to facts occurring outside the Turkish boundaries. The relevant passages of the Court’s ruling warrant quotation in full: according to this ruling “[i]nternational public law rules the relationship between independent States. The rules of law binding upon States therefore emanate from their own will. […] Now the first and foremost restriction imposed by international law upon a State is that […] it may not exercise its power in any form in the territory of another State. In this sense jurisdiction is certainly territorial. […] It does not however follow that international law prohibits a State from exercising jurisdiction in its own territory, in respect of any case which relates to acts which have taken place abroad. Such a view would only be tenable if international law contained a general prohibition to States to extend the application of their laws and the jurisdiction of their courts to persons, property and acts outside their territory, and if, as an exception to this general prohibition, it allowed States to do so in certain specific cases. But this is certainly not the case under international law as it stands at present. Far from laying down a general prohibition to the effect that States may not extend the application of their laws and the jurisdiction of their courts to persons, property and acts outside their territory, it leaves them in this respect a wide measure of discretion, which is only limited in certain cases by prohibitive rules; as regards other cases, every State remains free to adopt the principles which it regards as best and most suitable. This discretion explains the great variety of rules [on jurisdiction] which [States] have been able to adopt without objections or complaints on the part of other States; it is in order to remedy the difficulties resulting from such variety that efforts have been made for many years past, both in Europe and America, to prepare conventions the effect of which would be precisely to limit the discretion at present left to States in this respect by international law”213. The Lotus jurisprudence specifically applies not only to criminal proceeding, but also to national proceedings involving acts, persons or property tangible or intangible of a foreign State, and thus even to IPRs cases. First the literal interpretation of the Lotus decision highlights that the PCIJ does not explicitly limit its conclusion to criminal proceedings, but on the contrary refers to “any case”214 that relates to any “acts which have taken place abroad”215. Second, a teleological interpretation of the Lotus decision emphasizes that endeavours to formulate a principle of public international law useful to govern relations between States, and only an extensive interpretation of 213

Ibid 18-19. Ibid 19. 215 Ibid. 214

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the principle is able to respect such an ambition. Third, even if it is possible to maintain that criminal proceedings involve the fundamental rights/freedoms of individuals much more than civil proceedings do, that would mean that the Lotus decision applies to the former and there are no reasons why it should not encompass the latter. Finally, the same PCIJ216, as well as leading scholars around the world217 apply the Lotus jurisprudence to proceedings other than criminal ones. However, it is not certain whether Lotus jurisprudence still represents public international law as it stands at present. According to one opinion, the PCIJ Lotus conclusions in question were “condemned by the majority of writers who discussed the case and can be considered today overruled”218. This opinion is based on the following arguments. First, the majority of scholars do not support the Lotus decision. Second, the ICJ refers to it in a very limited number of cases219. Third, the Lotus decision would allow States to adopt exorbitant jurisdiction criteria that render the court seized competent even though it “does not possess a sufficient connection with the parties of a case, the circumstance of the case, the cause or subject of the action, or fails to take account of the principle of the proper administration of justice”220. However, this last opinion is unconvincing for the following reasons. First, important scholars always refer to the Lotus judgment as a leading case221, and even if scholars have considered the Lotus judgment overruled, this determination is obviously not enough in itself to alter general public international law. Second, the ICJ recalls the Lotus judgment in cases of a different nature than criminal ones222. Third, the Lotus judgment does not support exorbitant fora223, because according to the ICJ the freedom of States to exercise their jurisdiction inside their borders can be limited by public international law rules, including the ones posing the right of fair trial that impose on the 216 See ICJ, Legality of the Threat or Use of Nuclear Weapons, Advisory Opinion ICJ Rep 226 [1996] 238-239; Nicaragua Case (n 3 Chapter II); North Sea Continental Shelf Cases (n 3 Chapter II). 217 See the literature just referred to commenting on the Lotus case. 218 Olivia Struyven, ‘Exorbitant jurisdiction in the Brussels convention’ (1998–1999) Jura Falconis, nr 4 521–548, 521, available at accessed 30 November 2011; Handeyside (n 188 Chapter III) 73. See also the authors referred to by Dunoff and Trachtman (n 188 Chapter III). 219 According to Handeyside (n 188 Chapter III) 80-81, “The ICJ has only rarely construed the Lotus case. In fact, Lotus appears only three times in ICJ decisions on the merits, and of those, only one, Legality of the Threat or Use of Nuclear Weapons, refers directly to the Lotus principle”. 220 See the definition of the notion of exorbitant jurisdiction provided for by Struyven (n 217 Chapter III) para B. On exorbitant jurisdiction see also supra, para 1. 221 See supra, this same para. 222 Ibid. 223 See supra, para 1.

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States the abandoning of their international jurisdiction provisions inconsistent with this right, comprehensive of the exorbitant jurisdiction rules224. To sum up, the Lotus jurisprudence is not overruled and, according to its holding, public international law does not “suggest” the act of state doctrine and comity. Finally, public international law does not suggest the act of State or the comity doctrine because in current times there has been an abandonment of a strictly territorial conception of sovereignty and jurisdiction, as will be discussed in chapter IV of this book on the territoriality principle. 43. The Act of State and Comity are even Contrary to the Public International Law Rules on the Avoidance of a Denial of Justice and on the Right of Access to a Court The previous remarks conclude that public international law does not suggest either the act of state or the comity doctrine. The following assessments will now indicate that public international law is actually contrary to the extension of the act of State and comity doctrines to IPRs cases. In fact, the dismissal of a case under the act of State and comity doctrines is contrary to the right of access to a court, as established by both Article 6 ECHR and Article 14.1 of the International Covenant of Civil and Political Rights225, and which demands that “all disputes involving a person’s ‘rights and obligations’ be capable of submission to judicial settlement, or else that any dismissal in such a case be justified in accordance with the implicit requirements of the right of access, viz. the proportionate application of rules of law pursuing a legitimate aim”226. The entirety of chapter VI of this book is dedicated to the explanation of this assumption in relation to exclusive jurisdiction rules in IPRs cases. Yet, the following remarks will make certain assessments specifically related to the act of State doctrine and comity as being contrary to the right of access to a court. As will be examined in chapter VI of this book the right of access to a court is restricted legally when the limitations on this right are established by law, have a legitimate aim, and respond to the principle of proportionality. As for the establishment by law requirement, it may be doubted that the act of state doctrine and comity are “consistent, clear and precise”, and “foreseeable”227, among other reasons because the “resulting jurisprudence during the past decades” from the previously examined States “has injected further am-

224

See the literature quoted with respect to exorbitant jurisdiction supra, at para 1. On these Articles see in detail infra, chapter VI. 226 Thienel (n 60 Chapter III). 227 See infra, chapter VI. 225

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biguity into the application of international comity and the act of state doctrine”228. As for the requirement of a legitimate aim, the act of State and comity pursue aims other than the one that is considered to be the only legitimate aim with respect to cases with international elements, namely the compliance with effectively existing public international law rules229. As for the proportionality requirement, according to a recent opinion “the act of state doctrine does create serious problems under the right of access to a court inherent in Article 14 (1) CCPR, but its flexibility may leave the courts sufficient lee-way to strike a justifiable balance between the public interest in leaving sensitive areas of foreign relations law to the executive and the human rights of people approaching the court for settlement of their grievances”230. This opinion deserves to be welcomed and extended also to comity for the same reasons that it criticizes the act of State doctrine. However, the same opinion does not seem to be convincing where it tries to strike a balance between the fundamental human right of access to a court and the “interest” of the executive branch in dealing with sensitive areas of foreign relations. First a mere public interest cannot prevail over a fundamental human right, especially where this right holds a prominent place in a democratic society, as is the case with the right of access to the Courts231, and when the right to be adjudicated by the court seized is also a fundamental human right, as are IPRs232. Second, the limitations imposed on the right of access to a court by the act of State doctrine and by comity as adopted by the judgments here criticized are not flexible, but rather lead to an exclusive subject matter jurisdiction rule that limits the access to courts left to the individuals to such an extent that the very essence of the right of access to the court is impaired233. In summary, the rules on the act of State doctrine and comity cannot be applied in IPRs cases since they do not meet either the establishment by law, or the legitimate aim and the proportionality requirements, and therefore are contrary to the right of access to a court.

228

Tyshow (n 34 Chapter I) 276. See infra, chapter VI. Also, with particular regard to the act of state doctrine even though today it reflects the domestic constitutional arrangements as to the separation of powers, this reflection does not constitute a legitimate aim, since the right of access to a court predetermines one aspect of the separation of powers by demanding that all disputes involving a person’s ‘rights and obligations’ be, save justifications, capable of adjudication. 230 Thienel (n 60 Chapter III). 231 See infra, chapter VI. 232 See infra, para 48. 233 See infra, chapter VI. 229

Chapter IV

The Territoriality Principle does not Mandate Exclusive Jurisdiction Rules I. Territoriality and Universality I. Territoriality and Universality 44. Territoriality and Universality in Public International Law Since the emergence of the modern (European) international society of States with the treaties of Peace of Westphalia signed between May and October 1648 in Osnabrück and Münster, international relations have been based upon the concept of sovereign States. A sovereign State is a State with a permanent population, a defined territory, a government and the capacity to enter into relations with other sovereign States1. According to the classical definition of Huber in the Palmas Island case, “sovereignty in the relations between States signifies independence. Independence in regard to a portion of the globe is the right to exercise therein, to the exclusion of any other State, the functions of a State”2. In public international law, territory is the denotation of a certain physical and geographical space that constitutes one of the qualifications for Statehood: it asserts itself throughout the area of public international law; it grounds the so-called territorial imperative of public international law; and its influence can be felt in a number of fields. For example, territory is a fundamental component of the doctrine of non-intervention, according to which States shall refrain “from the dictatorial interference… in the affairs of another State for the purpose of maintaining or altering the actual conditions of things”3. Moreover, territory stands at the basis of the “high fiction” of the territorial sea4, the territorial airspace and the territorial “ice”. Finally, territory is linked to the notion of territorial jurisdiction, where justice is exercised by a State in relation to crimes committed on its territory5. 1

Shaw (n 2 Chapter II) 178. Island of Palmas (or Miangas) Case (United States v The Netherlands) (1928) 2 UN Rep Intl Arb Awards 829 (Permanent Court of Arbitration). 3 Steven Wheatley, ‘The Non-Intervention Doctrine and the Protection of the Basic Needs of the Human Person in Contemporary International Law’ (1993) 15 Liverpool Law Review 189. 4 Dino Kritsiotis, ‘Public International Law and its Territorial Imperative’ (2009) 30 Mich. J. Int’l L. 547. 5 Micaela Frulli, ‘Establishing Jurisdiction over International Crimes: Between Fragmented International Rules and Scattered Domestic Implementation’, speech given at the Universi2

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However, we are all witnessing a redeployment of the functions of the State and a redefinition of its relationship with its territory as one of its constitutive elements6, and therefore a tension exists between territorial sovereignty on the one hand, and the common interest of the international community on the other. This tension calls for the realisation of a fair balance between territorial and universal interests, and transports us beyond concepts of State territorial authority towards “the partial unbundling of traditional national territorial borders and the formation of new bordering capabilities, both subnational and transnational”7. As a consequence, a territorial subversion is occurring in many different fields of public international law. For example, the States’ transference of certain competences to international organisations enables these international organisations to exercise certain States’ sovereign competences without possessing sovereign authority over a certain territory. Moreover, when certain requirements are met, human rights call for the affirmation of an extraterritorial responsibility of States, towards individuals other than their own citizens8, and render highly debatable the doctrine of non-intervention as a guiding principle of international relations9. In addition, the emergence of universal interests such as the conservation of marine wildlife and the need to tackle climate change are replacing territorial considerations10 with unified aims11. Furthermore, cybertravel frustrates efforts to make the territorial scope of regulation and enforcement on the Internet mirror the geographical limits of the physical world12. Finally, the establishment of universal jurisdiction allows States to claim jurisdiction over persons whose alleged crimes were committed outside the boundaries of the prosecuting State, regardless of nationality, residence or any other relation with the prosecuting country13. 45. Territoriality and Universality in Relation to IPRs The tension between the territorial sovereignty of States and the common interests of the international community influences the international legal inty of Macerata (10 June 2011) under the title ‘International Criminal Law and its Application Within Domestic Legal Orders’. See accessed 30 November 2011. 6 Olivier De Schutter, ‘Globalization and Jurisdictions: Lessons from the European Convention on Human Rights’ (2009) Center for Human Rights and Global Justice Working Paper Number 9 (New York, NYU School of Law) 4. 7 Kritsiotis (n 4 Chapter IV) 553. 8 Ibid. 9 Wheatley (n 3 Chapter IV) 189-199. 10 Kritsiotis (n 4 Chapter IV) 554. 11 Ibid. 12 Goldman (n 226 Chapter I). 13 Frulli (n 5 Chapter IV).

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struments that are focused on cooperation between States with respect to intellectual property. In fact, certain IPRs, like copyrights or the rights on TK and F - that as referred to in para 5 are addressed as sui generis IPRs in this book - strictly relate to culture, and culture is universal in nature14. Also, certain other IPRs, like the rights on patents strictly relate to science, innovation, technical know how and research (for the purpose of this book science, innovation, technical know how and research will hereinafter be referred to collectively as science), which are also universal in nature15. In addition, the intangible expressions of culture and science render their universal character even more apparent. Thus, the tension between the territorial interests of States and the universal interests of the international community is a consequence of the fact that as expressions of intangible culture and science IPRs live within a “cultural [and scientific] space”, namely within a “physic or symbolic space where individuals meet each other in order to present or exchange certain social practices or ideas” or scientific knowledge. This space is merely a “cultural [and scientific] environment produced by the social practice throughout the adoption or the appropriation of certain structures, spaces or natural sites”16. As a consequence, IPRs cannot be linked to a precise physical and geographical territory, but rather are social and universal phenomena. Moreover, “the processes of globalisation, which have been facilitated by the rapid development of information and communication technologies, afford unprecedented conditions for enhanced interaction between cultures”17 and scientific communities, especially when these cultures and scientific knowledge are of an intangible nature. However, this process of globalisation “represents also a challenge” for IPRs also “in view of risks of imbalances between rich and poor countries”18, as well as risks of its transnational misappropriation. This risk of transnational misappropriation of IPRs19 raises a number of issues of how to protect these rights universally, exposing the territorial principle to increasing doubts20. However, at the international level there is currently no harmonisation of PIL rules relating to the universal protection of IPRs21. In the absence of an international agreement on the universal protection of 14 Tullio Scovazzi, ‘Le concept d’espace dans trois conventions UNESCO sur la protection du patrimonie culturel’ (2009) 26 L’Observateur des Nations Unies 7-23. 15 Ibid. 16 Ibid 22. 17 The UNESCO 2005 Convention (n 170 Chapter I) Preamble. 18 Ibid. 19 For cases occurring at the national rather than international level in connection with “incidents involving theft of indigenous peoples’ traditional knowledge and the blatant appropriation of culture”, see Angela Riley, ‘“Straight Stealing”: Towards an Indigenous System of Cultural Property Protection’ (2005) 80 Washington L. Rev. 69. 20 Basedow, ‘Foundations of Private International Law’ (n 148 Chapter I) 10. 21 See supra, para 1.

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IPRs from worldwide misappropriation, three approaches to transnationally protect IPRs have developed. The first approach consists of what can be described as semi-legal protection, namely, taking extrajudicial measures in order to settle the dispute outof-court. This approach is codified inter alia by certain provisions of the Uniform Domain Name Dispute Resolution Policy (UDRP) adopted by the Internet Corporation for Assigned Names and Numbers (ICANN) in 199922, which establishes that a certain class of disputes between domain name registrants and trademark holders (so-called cyber squatting disputes) can be adjudicated not by the court of the State for which the domain name is registered or according to the law of this State, but by quasi-arbitral panels appointed by ICANN-authorized dispute settlement providers and according to substantive rules that were developed in an unconventional process of international intellectual property law-making. In addition, this first approach related to the semi-legal protection is followed in a series of recent cases, involving cases where the parties start bringing proceedings related to the IPRs enforcement before one or more courts of the world, even obtain judgments in some of the jurisdictions concerned, but then at the end settle their entire claims out of court, as happened in Boosey & Hawkes Music Publishers Ltd. v Walt Disney Co23. This case concerned the use by Disney of Igor Stravinsky’s musical composition The Rite of Spring (hereinafter: the copyright work) in its 1940 animated film Fantasia. At the time of the film’s release, under United States law, the copyright work was considered ‘public domain’ material, therefore Disney would require no authorisation to record or distribute it in the US. Disney would require permission, however, to distribute the copyright work in countries where Stravinsky was still entitled to copyright protection. Therefore in 1939 Stravinsky and Disney executed an agreement to allow Disney the rights to use the copyright work in a motion picture on payment of $6,000 to Stravinsky. Fantasia was released, and for over fifty years showcased The Rite of Spring under the original license. Following the film’s release in video format in 1991, however, Boosey & Hawkes, the assignee of Stravinsky’s copyright for The Rite of Spring, brought an action in 1993 against Disney arguing that the 1939 agreement did not include a grant of right to Disney to use the copyright work in video format and sought damages for copyright infringement in at least 18 foreign countries. Although the US District Court for the District of New 22 See ‘Uniform Domain Name Dispute Resolution Policy’ Internet Corporation for Assigned Names and Numbers (26 August 2009) available at accessed 30 November 2011. See also Graeme Dinwoodie, ‘Symposium on Constructing‘ (n 101 Chapter III) 993. 23 145 F.3d 481 (2d Cir. 1998). On this case see Baddeley (n 52 Chapter II) 36; Austin, ‘The Concept of “Justiciability”’ (n 29 Chapter I) 408.

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York (where one of the suits was brought) concluded that Disney’s video format sales exceeded the scope of the 1939 license, it invoked forum non conveniens24, dismissing Boosey’s infringement claims related to non-US copyright on the grounds that they involved the application of foreign law and therefore should be “tried in each of the nations whose copyright laws are invoked”25. On appeal in 1998, the United States Court of Appeal for the Second Circuit disagreed on this point, and held that a reluctance to apply foreign law alone does not justify dismissal of a case26. In this way the court retained jurisdiction over the 18 foreign copyright infringement claims27. In the end, the parties chose to settle all claims: in 2001 Boosey agreed to settle the dispute for $3 million28. Furthermore, with respect to the sui generis (IP) rights on TK, GR and F29 this first approach of proceeding concerning the semi-legal protection is followed in a series of recent cases which can be divided into two different groups: the misappropriation of Mori language and imagery; and the misappropriation of traditional songs by music bands. The first group of cases30 involves the appropriation of Mori language and imagery in Lego toys (2001)31, in cigarettes marketed by Philip Morris in Is-

24

See para 71. Boosey (n 23 Chapter IV) 53. 26 Ibid 60. 27 The ALI Principles (n 58 Chapter I) 3. 28 See ‘Boosey & Hawkes Settle with Disney’ The Telegraph (London, 21 March 2001) available at accessed 30 November 2011. On this case see Graeme Dinwoodie, ‘Developing a Private International Intellectual Property Law: The Demise of Territoriality?’ (2009) 51 Wm. & Mary L. Rev. 740-743. According to Dinwoodie, “it is not uncommon that resolution of the private international law questions raised by multiterritorial intellectual property disputes proves sufficient to encourage the parties to reach a private settlement of all the separate national claims” (ibid) 742. See also Microsoft Corp v Lindows.com, Inc., unreported, No. C01-2115C, 2002 WL 31499324, in which Microsoft filed a case in Seattle against Lindow alleging infringement of its trademark WINDOWS in the use of LINDOWS for an operating system whose interface resembled Microsoft’s own software. Litigation was initiated or threatened in a number of other countries as well. Eventually a global settlement was reached in 2004 to the amount of $20 million, paid to Lindows. 29 See supra, para 5. 30 On some of the cases referred to in the text see Paul Myburg, ‘New Zealand / Aotearoa’ in Kono, The Impact of Uniform Laws (n 170 Chapter I) 661. For further information on the protection of New Zealand’s intangible cultural heritage see also Ben Sullivan, ‘Intangible Cultural Heritage in New Zealand/Aotearoa: A National Perspective’ in Scovazzi, Ubertazzi and Zagato (n 162 Chapter I) forthcoming. 31 See Kim Griggs, ‘Maori take on hi-tech Lego toys’ BBC News (New Zealand, 26 October 2001) available at accessed 30 November 2011. 25

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rael (2005-2006)32, in the koru (unfurling fern frond) design on Canterbury rugby boots (2002)33, in Jean Paul Gaultier’s use of moko (traditional Mori facial tattoo) on fashion models (2007)34, in a television advertisement by car maker Fiat to sell the new Fiat Idea city car, in which the advertisers wanted a crowd of black-clad Italian women to perform a Maori Kapa haka, a war dance traditionally performed only by men (2006)35, in the “disrespectful”36 misappropriation of a Mori cultural icon, Hei-tiki, for the commercial sale of HEITIKI infant formula (2011)37 and in the appearance of an “instantly recognisable”38 Mori tattoo design in the 2011 movie The Hangover Part II (2011)39. Following protests over the misappropriation of Mori ICH, both Lego and Philip Morris withdrew their toys and cigarettes respectively. These 32 The Mori Mix cigarette controversy involved a number of issues, namely the exploitation of Mori culture/community by a multi-national corporate entity; the use of cigarettes associating the illness and premature death of cigarette smokers with Mori culture; and the use of pseudo-Mori imagery/stylized art. 33 See Peter Shand, ‘Scenes from the Colonial Catwalk: Cultural Appropriation, Intellectual Property Rights and Fashion’ (2002) 3 Cultural Analysis 47. 34 See ‘Ta Moko – traditional tatoos of the Mori people’ Tao of Tattoos, available at accessed 30 November 2011, where it is stated “the majority of people who are using Moko inspired designs didn’t take the time to learn anything about its origins or significance. It is understandable why some Mori are offended by the use of bits and pieces of their culture … Hopefully the Mori people will continue their efforts to keep this beautiful and interesting cultural art alive, the rest of the world can come to respect this sacred cultural ritual, and the two can come to an agreement about its use in today’s society”. 35 The use of Mori Kapa haka by Fiat aimed to stimulate the atmosphere of an All Blacks rugby match. See ‘When haka is not okay’ available at accessed 30 November 2011. 36 Kate Duckworth and Thomas Huthwaite, ‘Legal Protection for Traditional Knowledge’ Baldwins (3 June 2011) para 3, available at accessed 30 November 2011. 37 Heitkiki infant formula is a baby milk powder formula marketed in New Zealand by Kiaora New Zealand International. Heitiki “can be loosely translated as a Mori Greenstone pendant worn around the neck”, according to ‘Heitiki Formula Made in New Zealand’ The New Zealand Herald (31 May 2011) para 6, available at accessed 30 November 2011. 38 Duckworth and Huthwaite (n 36 Chapter IV) 1. 39 Tattoo artist S. Victor Whitmill filed a copyright claim against the film studio releasing ‘The Hangover Part 2’ claiming his design was used on screen. Professor Ngahuia Te Awetuku, author of Mau Moko: The World of Maori Tattoo, has stated “The tattooist has never consulted with Maori, has never had experience of Maori and originally and obviously stole the design [that ended up in the film]”, Duckworth and Huthwaite (n 35 Chapter IV) para 4. The copyright claim has since been privately settled, see ‘Mystery Settlement in ‘Hangover 2’ Tattoo lawsuit’ TMZ (20 June 2011) available at accessed 30 November 2011.

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products were deemed to have misappropriated Mori ICH40 and both companies chose not to incorporate images and names from Mori ICH in future launches of their products41. Moreover, in the Philip Morris case, the CEO of the company issued an apology to the Mori people during a shareholders meeting in New York, which was televised nationally in New Zealand, where a spokesperson stated that “we sincerely regret any discomfort that was caused to Mori people by our mistake and we won’t be repeating it”42. However, the company did not grant any monetary compensation to the Mori. By contrast, although the New Zealand Ministry of Foreign Affairs and Trade advised Fiat that the use of the Haka in their advertisement for the Idea city car “was culturally insensitive and inappropriate”, the company indicated that it was proceeding with the campaign despite this advice43. The second group of cases involves the misappropriation of traditional songs by certain rock groups. For instance, in a recent case, the German rock group Enigma misappropriated a song that belongs to the tradition of Taiwan’s Ami tribe and is customarily performed by a host to welcome his or her guest44. This song was sung by an elderly Amis aboriginal couple named Kuos and was performed in Europe during a 1988 tour of Europe by the Kuos. Subsequently, the song was illicitly recorded during a performance in France by the Maison des Cultures du Monde and by the EMI record Company. The Enigma group remixed the song using two minutes of the Kuos’ voices. The same group renamed the song Return to Innocence. In 1996 the song was used for the Olympic Committee’s promotional advertisement and was then seen by people in Taiwan and by the Amis as part of the Olympic promotion on CNN and other US networks that were broadcast worldwide. Finally, Return to Innocence burst into Billboard Magazine’s International Top 100 and stayed there for 32 straight weeks45. However, the Kuos and the Amis tribe were never informed by the Enigma group or by EMI Record Company of the use of their voices. The Kuos asked for recognition as the original artists and requested to perform the song at the opening ceremony of the Olympic games 40

On this terminology see supra, para 5. With regard to Lego see Griggs (n 31 Chapter IV). With regard to Philip Morris see Heather Gifford and Shane Bradbrook, ‘Recent actions by Mori politicians and health advocates for a tobacco-free Aotearoa/New Zealand, A brief review’ (Occasional Paper 2009/1) 6, available at accessed 30 November 2011. 42 Gifford and Bradbrook (n 41 Chapter IV) 6. 43 See ‘When haka is not okay’ (n 35 Chapter IV). 44 On this case see in great detail Angela Riley, ‘Recovering Collectivity: Group Rights to Intellectual Property in Indigenous Community’ (2000) 18 Cardozo Arts and Entertainment Law Journal 175. 45 Ibid. 41

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in Atlanta. When this didn't materialise, the Kuos began a legal battle out-ofcourt not only in order to obtain financial compensation and recognition, but also to protect the cultural heritage of the whole tribe46. However, as of today, the Kuos and the Amis “have received neither credit nor payment for being the star singers”47. After the Enigma CD was released, the Maison des Cultures du Monde did eventually agree to pay a symbolic fee of FF 15,000 (less than US dollars 3,000) to the Chinese Folk Arts Foundation, which brought the Ami group to Europe for the first time. But because there currently exists a running dispute over who (if anyone) really owns the copyrights and related rights over the music of the Ami people, the money has remained in the Foundation, and has not been given over to the indigenous people who performed in Europe48. A second approach to universally protecting IPRs consists of the so-called instances of positive protection, namely in claiming before the competent administrative or judiciary authorities of the different countries involved in the protection of the IPRs in issue. This second way of proceeding is typical of the multi-state approach related to the IPRs enforcement. So, for instance in the Epilady case (EP0101656), infringement suits of the patent-holder were successful in Belgium, Germany, Italy and the Netherlands, but not successful in Austria, France and the United Kingdom49. Furthermore, with respect to the sui generis (IP) rights on TK, GR and F this second way of proceeding is followed in relation to the so-called “derivates”: patents over inventions based on traditional knowledge associated with genetic resources, as well as copyrights over works created by a particular author in developing the folklore further. Other IPRs which may provide for some form of protection to ICH, include trade secrets, collective trademarks and geographical indications50. This second way was followed inter alia in the case Gallo51, where the protection of the copyright owned by the plaintiffs (by assignment or as original authors) over the musical “Umoja”, created by them for the purposes of developing the South African folklore further, was sought in South Africa, whereas the South African Supreme Court held that the plaintiffs should have started proceed46

Ibid. Ashely Esarey, ‘An Ami Couple Seeks Recognition for their Music’ available at accessed 30 November 2011. See also Riley (n 44 Chapter IV) 175. 48 See Esarey (ibid). 49 See in detail infra, para 90, where other relevant case-law is referred to. 50 See Von Lewinski (n 152 Chapter I) 510. See also de Miguel Asensio, ‘Transnational Contracts’ (n 162 Chapter I) para 2. On geographical indications see Ubertazzi and Muñiz Espada (n 194 Chapter I) 65. On the differences and similarities between geographical indications and ICH see Herrero de la Fuente (n 194 Chapter I) 11; Kono, ‘Geographical Indication’ (n 194 Chapter I) 289. 51 Gallo (n 28 Chapter I). On this case see supra, paras 1 and 3. 47

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ings in each and every jurisdiction where the copyright infringement allegedly took place, namely in 20 countries52. A third approach to universally protecting IPRs consists of so-called instances of defensive protection, namely petitioning the competent administrative or judicial authorities to refuse to grant or to revoke IPRs in respect of TK, GR and F that are granted to persons or organisations outside indigenous communities in cases where the ICH of those indigenous communities has been misappropriated. For example, a patent may be revoked (or not granted in the first place) if it can be demonstrated that traditional knowledge, eventually published53, represented prior art, thereby destroying the patent’s novelty and inventive step, which are necessary requirements of patentability: novelty is the requirement that the “invention […] does not form part of the state of the art” (Article 54 ECP)54 and respectively the inventive step is the condition that “an invention […] having regard to the state of the art […] is not obvious to a person skilled in the art” (Article 56 EPC)55. Furthermore, it is possible to fight claims to copyright over folklore under the condition that the same expression of folklore existed before the claim to protection. Similarly, a trademark application may be refused in cases of offensive marks or trademarks that are against good morals and public order, or marks that have been registered in mala fede. For example, in March 2010, the European Patent Office decided to withdraw American multinational company Natreon Inc’s patent application in respect of an Indian wonder plant, Ashwaganda (Withania somnifera) used in the treatment of a range of illnesses, including stressrelated conditions. The withdrawal of the application was based on India’s 52

See supra, para 3. According to section 102(a) and (b) of the United States Patent Act, an invention’s lack of novelty must be exhibited through written evidence i.e. a printed publication, before invention or one year prior to the date of US patent application within the US or overseas. Thus, oral traditional knowledge existing somewhere else in the world cannot play a role in demonstrating the lack of novelty of patents registered in the US. See David Downes and Sarah Laird, ‘Community Registries of Biodiversity-Related Knowledge: The Role of Intellectual Property in Managing Access and Benefit’, Prepared for UNCTAD Biotrade Initiative (1999) 16, available at accessed 30 November 2011. As already referred to, supra para 1, on 16 September 2011 US President Obama signed the Leahy-Smith America Invents Act into law. This law includes changes that increase the pool of prior art. 54 Article 54 of the European Patent Convention (n 3 Chapter I) on “novelty” establishes that “(1) an invention shall be considered to be new if it does not form part of the state of the art. (2) The state of the art shall be held to comprise everything made available to the public by means of a written or oral description, by use, or in any other way, before the date of filing of the European patent application”. 55 Article 56 of the European Patent Convention (n 3 Chapter I) on “inventive step” posits that “an invention shall be considered as involving an inventive step if, having regard to the state of the art, it is not obvious to a person skilled in the art”. 53

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documentary proof confirming that medicinal formulations using Ashwagandha had been used in India as far back as the 12th century56. A recent case involving the use of trademarks to provide defensive protection of ICH concerned the chocolate manufacturer, Lindt57. Lindt, having produced chocolate in the shape of bunnies since the early 1950s and marketed in Austria since 1994, became, in 2000, the proprietor of a European Community three-dimensional trademark, representing a gold-coloured chocolate bunny in a sitting position, wearing a red ribbon with a bell attached, marking the words Lindt GOLDHASE in brown lettering. After registering the trademark in question, Lindt initiated legal proceedings against certain Austrian manufacturers who were allegedly manufacturing products so similar to the bunny protected by that mark that there was a likelihood of confusion58. However, one of those manufacturers raised a counterclaim and sought a declaration of invalidity of the Lindt trademark59. The manufacturer argued that Lindt was acting in bad faith within the meaning of Article 51(1)(b) of EU Regulation No 40/94 of 20 December 1993 on the Community trademark60 when it filed its application for registration of the three-dimensional Community mark in question61. In particular, the manufacturer argued that Lindt knew that in both Austria and Germany a tradition existed from at least 1930 of marketing chocolate bunnies, commonly called Osterhasen (Easter bunnies), in shape and colour very similar to the one represented by the Lindt three-dimensional mark. In this case the Austrian Supreme Court stayed the proceedings pending before it and referred three preliminary questions relating to the interpretation of Article 51(1)(b) of Regulation 40/94 to the Court of Justice of the European Union (ECJ)62. In response to those questions the ECJ asserted that “in order to determine whether the applicant is acting in bad faith within the meaning of [this] Article […] the national court must take into 56 On this case see Sandhya Srinivasan, ‘Pirates of Traditional Knowledge’ Infochange, News and analysis on social justice and development issues in India (June 2010) available at accessed 30 November 2011; Kounteya Sinha, ‘India beats back US firm’s bid to patent Ashwagandha formulations’ The Times of India (27 March 2010) available at accessed 30 November 2011. 57 Case C-529/07 Chocoladefabriken Lindt and Sprüngli AG v Franz Hauswirth GmbH [2009] ECR I-4893. On this case see Laura Donnellan, ‘Three-Dimensional Trade Marks: the Mars and Lindt cases’ (2010) 32(3) EIPR 132; Ron Moscona, ‘Bad faith as grounds for invalidation under the community trade mark regulation - the ECJ decision in Chocoladefabriken Lindt and Sprungli AG v. Franz Hauswirth GmbH’ (2010) 32 EIPR 48. 58 Lindt (n 57 Chapter IV) paras 9-20. 59 Ibid. 60 Council Regulation (EC) No 40/94 (n 3 Chapter I). 61 Lindt (n 57 Chapter IV) paras 9-20. 62 Ibid para 21.

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consideration all the relevant factors specific to the particular case which pertained at the time of filing the application for registration of the sign as a Community trade mark, in particular: the fact that the applicant knows or must know that a third party is using, in at least one Member State, an identical or similar sign for an identical or similar product capable of being confused with the sign for which registration is sought; the applicant’s intention to prevent that third party from continuing to use such a sign; and the degree of legal protection enjoyed by the third party’s sign and by the sign for which registration is sought”63. The ECJ deferred to the national court, as usual, the decision whether in the actual case before them the trademark in question was registered in bad faith by Lindt. To sum up, the first approach to obtaining universal protection of IPRs, related to the semi-legal protection, is generally successful. Thus, for instance with respect to the sui generis (IP) rights based on the ICH of the original culture the wrongdoer withdraws from the relevant markets any products based on the ICH; no longer manufactures and distributes those products and does not incorporate any further images and names from the original culture of the ICH. Moreover, the wrongdoer regularly undertakes the performance of reconciliatory acts such as issuing an apology or expressing humiliation. However, the wrongdoer does not usually grant any monetary compensation. In addition, with regard to the series of recent cases where the parties start bringing proceedings related to the IPRs enforcement before one or more courts of the world, even obtaining judgments in some of the jurisdictions concerned, but then at the end settle all of their claims out of court, the eventually needed enforcement of the settlements in question has to be perpetrated in each country where the debtor’s assets are located, remaining therefore national and territorial. The second and third approaches to the transnational protection of IPRs, related to the instances of positive and respectively defensive protection, do not succeed in granting universal protection to IPRs owing to the territorial nature of the IPRs that are either invoked over inventions or works associated with the ICH (under the second approach) or that are attacked to protect the ICH (third approach). For example, in the Gallo case64, the South African Court refused to examine the plaintiffs’ claims as far as the foreign infringements were concerned. The Court stated that “intellectual property rights (IPRs) are territorial in nature [which] leads ineluctably to the conclusion that IPRs, including copyright, are immovable intangibles and that … local courts do not have jurisdiction in respect of foreign copyright issues”65. In the Nat-

63

Ibid para 53. See supra, paras 1 and 3. 65 Gallo judgment (n 28 Chapter I) 19. 64

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reon Case66, which illustrates the third approach to universal protection of IPRs, the failure of the patent application in Europe did not affect the granting of the patent in United States’ territory because of the territorial nature of patents67. To prevent the misappropriation of traditional knowledge, India has signed agreements with the European Patent Office, the United States Patent and Trademark Office, the Canadian Intellectual Property Office, the German Patent Office and the United Kingdom Patent Office. According to those agreements “if there is any new patent that comes up for examination in these countries that’s related to India’s traditional knowledge the patent examining body can access India’s database to see if it is worthy of a patent and/or reject the application. Since the database is available in a number of languages like Spanish, German, French, English, and Japanese it helps bridge the gap between the patent examiners and traditional knowledge”68.

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46. The Territoriality Principle as an Obstacle to the Universal Protection of the IPRs. Thesis Proposing to Achieve that Universal Protection throughout International Legal Systems other than that which is Established for IP. The Relevance of these Theses for Present Purposes. In sum, because of the territoriality of IPRs, the second and third approaches to protection require the applicant to initiate separate legal actions in each and every country in which the IPRs invoked or attacked have been filed, granted or come into existence69. To overcome this territorial approach and to universally protect (not only semi-legally but also legally) the IPRs from misappropriation, different proposals have been suggested. According to these proposals, the universal protection of ICH can be achieved through the application, by analogy, of existing customary public international law rules relating to the crime of piracy; by relying on the international law of human rights; or through the application of rules similar to those found in the 1995 UNIDROIT 66

See the case referred to by Srinivasan (n 56 Chapter IV). Ibid. See supra, this same para for the US system according to which oral traditional knowledge existing somewhere else in the world cannot play a role in demonstrating the lack of novelty of patents registered in the US. 68 Ketki Angre, ‘Measures to tackle bio-piracy: Safeguards for India’s traditional medicine and knowledge’ New Delhi Television (15 October, 2010) available at accessed 30 November 2011. 69 Jacques de Werra, ‘Fighting Against Biopiracy: Does the Obligation to Disclose in Patent Applications Truly Help?’ (2009) 42 Vand. J. Transnat’l L. 174. 67

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Convention on Stolen or Illegally Exported Cultural Objects70. In contrast, under these proposals the same result cannot be achieved through the IPRs system among other reasons71 because of the territorial nature of IPRs, which is also referred to as the territoriality principle72. Yet, these proposals have been put forward in relation to ICH, rather than with specific regard to IPRs. However, they can reasonably be extended, mutatis mutandis, to the universal protection of IPRs and therefore are worth examining in this chapter for the following reasons. First, IPRs cover expressions of intangible culture. Second, certain IPRs objects are developments of ICH, so-called derivates, such as patents over inventions based on TK associated with GR, or copyrights over works developing a particular folklore further; while other IPRs may “provide for some form of protection” of the ICH, such as trade secrets, collective trademarks, and geographical indications73. Third, national and regional laws already existing, as well as international negotiations currently taking place for the conclusion of a universal agreement on the protection of TK, GR and F consider these rights as sui generis IPRs74. Fourth, all the theses in issue are based on the same premise, namely that the universal protection of TK, GR and F from misappropriation cannot be achieved throughout the IPRs system due to the territorial nature of IPRs and due to the territoriality principle75, which constitute the object of this chapter. Fifth, the theses in question adopt public international law arguments to reach conclusions that concern the private international law issue of exclusive jurisdiction, constituting as such paramount examples of how these two fields of law are closely connected to the object of this book. 70 It is beyond the aim of this book to examine if and how tribal law can help in this respect. To this end see Riley (n 44 Chapter IV) 69. 71 These reasons other than the territorial nature of IPRs do not form the object of this book. For an examination of the other reasons referred to see Darrell Posey and Graham Dutfield, Beyond Intellectual Property: Toward Traditional Resource Rights for Indigenous Peoples and Local Communities (Ottawa, IDRC 1996); Robert Paterson and Dennis Karjala, ‘Looking Beyond Intellectual Property in Resolving Protection of the Intangible Cultural Heritage of Indigenous Peoples’ (2003) 11 Cardozo J. Int’l & Comp. L. 645; de Miguel Asensio, ‘Transnational Contracts’ (n 162 Chapter I) para 2. 72 On the territorial nature of IPRs also in a comparative perspective, see Alexander Peukert, ‘Territoriality and Extraterritoriality in Intellectual Property Law’ in Günther Handl and Joachim Zekoll (eds), Beyond Territoriality: Transnational Legal Authority in an Age of Globalization (forthcoming, Leiden/Boston, Brill) para 1, available at accessed 30 November 2011. See infra in detail, this chapter. 73 Von Lewinski (n 152 Chapter I) 510. See also de Miguel Asensio, ‘Transnational Contracts’ (n 162 Chapter I) para 2. 74 See supra, para 5. 75 Also other reasons that are not the object of this book.

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Therefore, for simplicity and stylistic reasons the following remarks will examine the proposals in issue on ICH as if they were expressed (not only on ICH but also) on IPRs. 47. Crimes of Piracy, Cyberattacks and Biopiracy According to the first proposal, universal protection of IPRs can be achieved through the application, by analogy, of the customary public international law rules relating to the crime of piracy76. The customary and conventional international law of piracy provides that piracy consists of: any act of violence; committed for private ends; on the high seas or in a place beyond the relevant jurisdiction of any State; and which is committed by one vessel against another77. As a result of the gravity of the crime and because it is of a type that is not exclusively limited as a matter of principle by territorial considerations, the jurisdiction in relation to the crime of piracy is itself universal. Thus, “there are no territorial limits with respect to the prescription, apprehension, trial and conviction of the pirate”78, and any State may send a warship to board a pirate vessel, arrest those on board and subject them to the jurisdiction of its courts. First, the piracy analogy was adopted to extend universal jurisdiction to certain crimes occurring within territories under the jurisdiction of States, rather than in places beyond the jurisdiction of any State. For example, Articles 4(2) and 7 of the 1970 Hague Hijacking Convention79 extend universal jurisdiction to the crime of hijacking that occurs not only in flight but also on the ground, and precisely in the territory under the jurisdiction of a State. Second, the UN Security Council acting under Chapter IV of the UN Charter has adopted Resolutions (SCR 1816, 1838, 1846 and 1851) on piracy taking place in Somali waters. Resolution 1816 authorised cooperating States to 76

On the piracy analogy with regard to universal jurisdiction in general, see Eugene Kontorovich, ‘The Piracy analogy: Modern Universal Jurisdiction’s Hollow Foundation’ (2004) 45 Harv. Int’l L. J. 183. 77 Piracy as such can occur only on the high seas and not in areas subject to State sovereignty. See Articles 101-107 and 110 of the UN Law of the Sea Convention (opened for signature 10 December 1982, entered into force 14 November 1993) (UNCLOS). As of 15 May 2011 the Convention is binding on 162 States. 78 Winston Nagan, ‘Misappropriation of Shuar Trational Knowledge (TK) and Trade Secrets: A Case Study on Biopiracy in the Amazon’ (2010) 15 J. Tech. L. & Pol’y 55-56. See also Mitsue Inazumi, Universal Jurisdiction in Modern International Law: Expansion of National Jurisdiction for Prosecuting Serious Crimes Under International Law (Intersentia 2005) 52. 79 The Convention for the Suppression of Unlawful Seizure of Aircraft (opened for signature 16 December 1970, entered into force 14 October 1971) UN Treaty Series 1973. As of 3 September 2008 the Convention is binding on 185 States. Text available at accessed 30 November 2011.

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take the same steps with respect to piracy, among which universal jurisdiction is included80, in the Somali territorial sea as the law of piracy permits on the high seas. Resolution 1851 authorised cooperating States to go even further and engage in counter-piracy action on Somali soil. This scheme has since been renewed in Resolutions 1897, 1918 and most recently in Resolution 195081. Third, the piracy analogy has been extended to include the appropriation and otherwise unlawful stealing of IPRs, as well as the production and distribution of pirated material. This is especially significant when the unlawful appropriation involves modern communication technologies, which by their very nature transcend traditional geographic space. This is illustrated by the case of so-called cyber attacks relating to “not just particular data, such as stock prices, but entire computer systems such as stock exchanges or power grids”82. These cyber attacks are frequently described as the 21st century’s new form of disaggregated warfare, conducted by non-State collectiveness and which “displays new conceptions of territoriality”83. To address these cyber threats the US Department of Defence released on 14 July 2011 the 80

See the report recently submitted to the Security Council by the UN Secretary General, available at accessed 30 November 2011. This report sets out 7 options for prosecuting the persons responsible for piracy off the coast of Somalia, among which 6 concern the establishment of a Somali Court, or respectively of special chambers within the national jurisdiction of a State or States in the region, or of a regional tribunal, or of an international tribunal on the basis of an agreement between a State in the region and the UN or by Security Council Resolution under Chapter VII of the Charter of the United Nations. 81 UN Security Council Resolution 1846 (2 December 2008), text available at accessed 30 November 2011; UN Security Council Resolution 1897 (30 November 2009), text available at accessed 30 November 2011; UN Security Council Resolution 1918 (27 April 2010), text available at accessed 30 November 2011; UN Security Council Resolution 1950 (23 November 2010), text available at accessed 30 November 2011. See also Ashley Roach, ‘Agora: Piracy Prosecutions. Countering Piracy off Somalia: International Law and International Institutions’ (2010) 104 American Journal of International Law 400. 82 Kelly Gable, ‘Cyber-Apocalypse Now: Securing the Internet Against Cyberterrorism and Using Universal Jurisdiction as a Deterrent’ (2010) 43 Vand. J. Transnat’l L. 101. See also Jonathan Ophardt, ‘Cyber Warfare and the Crime Against Aggression: The Need for Individual Accountability on Tomorrow's Battlefield’ (2010) 3 Duke Law and Technology Review, available at accessed 30 November 2011; Martin Libricki, Cyberdeterrence and Cyberwar (Santa Monica, Rand 2009). 83 Ophardt (n 82 Chapter IV) introduction (this paper does not have page numbers).

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Dod Strategy for Operating in Cyberspace, according to which, “more than 60,000 new malicious software programs or variations are identified every day threatening our security or economy and our citizens”84. In this context, according to US strategies, “strong partnerships with … foreign nations are crucial”85 because determining in which State the attack occurred is extremely difficult for at least three reasons. First, because the crime itself occurs in cyberspace. Second, because the perpetrators of the crime operate beyond the territory of any one State using computers in multiple States. Third, because the wrongdoers have extensive technological tools at their disposal to make it look like the attack came from elsewhere. Each of these difficulties makes it impractical to assert territorial jurisdiction, rendering it necessary to extend universal jurisdiction to cyber attacks. The arguments for this extension are many, among which is the analogy with the crime of piracy86. First both the crime of piracy and the crime of cyber attacks are committed beyond the control of any one State, and cyberspace can easily be analogised to the high seas given that no one State controls it. Second, each crime is committed by individuals or groups of individuals acting without State consent. Third, each crime threatens international trade and the global economy. Finally, each crime can be based on financial motives: thus, even when the primary aims of both crimes are mainly religious or political the financing of the religious or political agenda is still a central issue. Under this framework it has been suggested that the approach governing the crime of piracy be extended to the universal misappropriation of IPRs, which has already been classified as biopiracy when the misappropriation of IPRs concerns traditional knowledge related to genetic resources87. However, this proposal is not entirely convincing because it does not demonstrate that the crimes of hijacking, or the crime of ‘piracy’ perpetrated not on the high seas, or the crime of piracy relating to IPRs, are subject to universal jurisdiction under customary international law in contrast to piracy perpetrated on the high seas. In the case of hijacking for example, the prevailing opinion suggests that while it appears that the return of the hijacked aircraft and the persons on board are required by customary international law,

84

The US Department of Defense, ‘Dod Strategy for Operating in Cyberspace’ (14 July 2011) available at accessed 30 November 2001. 85 Ibid. 86 Gable (n 82 Chapter IV) 105. Among the arguments for the extension of universal jurisdiction to cyberattacks, the author highlights the heinous nature of the crime which “is on par with traditional terrorism, genocide and crimes against humanity”, crimes which are “subject to universal jurisdiction”. 87 Nagan (n 78 Chapter IV) 18.

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the crime itself is not subject to universal jurisdiction by virtue of custom88. Secondly, with regard to piracy taking place within Somali waters, the UN Resolutions in question clearly establish that they apply only to the situation in Somalia and do not serve as a precedent for customary law or modify parties’ rights and obligations more generally under international law89. Furthermore, to be classified as a cooperating State under the relevant UN Resolutions a State must be operating with the consent of the Somali Transitional Federal Government, as notified in advance to the UN Secretary General90. In addition, with respect to the crimes of cyber attacks and biopiracy, it seems that notwithstanding the recent and interesting academic proposals to prosecute these crimes under the principle of universal jurisdiction91, there is currently no customary rule which confers universal jurisdiction on these crimes and therefore territorial jurisdiction still applies. Moreover, with particular regard to the crime of intellectual property piracy perpetrated throughout the Internet, the enforcement of the infringed IPRs usually remains national as a result of their territorial nature. In sum, uniform, consistent and general State practice as well as opinio iuris ac necessitatis are still lacking with regard to universal jurisdiction as applied to the crimes of hijacking, piracy perpetrated not on the high seas, cyber attacks and biopiracy. Thus, in the absence of a customary international law rule on universal jurisdiction in relation to these crimes, it is apparent that this rule cannot be applied by analogy to the crime of misappropriation of IPRs. 48. Human Rights to Intellectual Property According to a second proposal, the universal protection of ICH can be achieved by relying on the international rules concerning human rights. A first 88 Boleslaw Boczek, International Law (Maryland, Scarecrow Press 2005) 202. Occasionally unilateral measures were resorted to, as demonstrated by the Entebbe raid in 1976 by Israelis commandos, who rescued mostly Jewish passengers on an Air France airliner held hostage at a Ugandan airport. However, the Ugandan government protested strongly against this unilateral act. On this case see Eleanor McDowell, ‘United Nations: Security Council Debate and Draft Resolutions Concerning the Operation To Rescue Hijacked Hostages at the Entebbe Airport’ (1976) 15 International Legal Materials 1224. In a similar incident German soldiers successfully recaptured a hijacked Lufthansa airplane in Mogadishu, Somalia. This time the local government gave its consent. 89 See Douglas Guilfoyle, ‘Piracy Off Somalia: UN Security Council Resolution 16 and IMO Regional Counter-Piracy Efforts’ (2008) 57 Int’l & Comp. L. Q. 690; James Gathii, ‘Kenya's Piracy Prosecutions’ (2010) 104 AJIL 416. 90 French commandoes seized the Le Ponant hijackers on Somali soil in Summer 2008, with the Somali Transitional Federal Government expressly consenting to the mission. However, it is not clear whether France received permission in advance or simply acquiescence after the event. 91 See Gable (n 82 Chapter IV); Ophardt (n 82 Chapter IV).

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set of rules relates to the human rights of all persons and of minority groups or indigenous peoples to enjoy their own culture and thus also their own intellectual property as an expression of that culture92. Among those rules at the international level are Article 27 of the 1966 International Covenant on Civil and Political Rights93; Article 15 of the 1966 International Covenant on Economic, Social and Cultural Rights94; and Article 8(2)(a) of the United Nations Declaration on the Rights of Indigenous Peoples adopted by the United Nations General Assembly in 200795. At the regional level, among the rules relating to the fundamental human right to enjoy culture are Article 22 of the Charter of Fundamental Rights of the European Union96; and Article 4(1) of the Framework Convention on the Value of Cultural Heritage for Society (Faro Convention) adopted under the framework of the Council of Europe97. A second set of rules concerns the human rights of all persons and also of minority groups or indigenous peoples to property. Those rules adopt a broad concept of property, which includes IPRs, as will be explained later in this paragraph. Among those rules at the universal level are Article 17 of the Uni92

On the following rules and on the topic in general see for all Lauso Zagato, ‘Intangible Cultural Heritage and Human Rights’ in Scovazzi, Ubertazzi and Zagato (n 162 Chapter I). 93 International Covenant on Civil and Political Rights (adopted 16 December 1966, entered into force 23 March 1976) 999 UNTS 171, according to which “in those States in which ethnic, religious or linguistic minorities exist, persons belonging to such minorities shall not be denied the right, in community with the other members of their group, to enjoy their own culture, to profess and practise their own religion, or to use their own language”. Text available at accessed 30 November 2011. 94 International Covenant on Economic, Social and Cultural Rights (adopted 16 December 1966, entered into force 3 January 1976) UN Treaty Series 993, according to which “the States Parties to the present Covenant recognize the right of everyone: a) to take part in cultural life; b) to enjoy the benefits of scientific progress and its applications; c) to benefit from the protection of the moral and material interests resulting from any scientific, literary or artistic production of which he is the author”. Text available at accessed 30 November 2011. 95 United Nations Declaration on the Rights of Indigenous Peoples (13 September 2007) UNGA Res 61/295, available at accessed 30 November 2011. The relevant rule requires States inter alia to “provide effective mechanisms for prevention of, and redress for … any action which has the aim or effect of depriving [indigenous people] of their integrity as distinct people, or of their cultural values or ethnic identities”. 96 Charter of Fundamental Rights of the European Union [2000] OJ C364/1, which states that “the Union shall respect cultural, religious and linguistic diversity”. Text available at accessed 30 November 2011. 97 Framework Convention on the Value of Cultural Heritage for Society (adopted 27 October 2005, entered into force 1 June 2011) CETS No. 199 (Faro Convention), establishing the right of everyone to benefit from cultural heritage (and to contribute to its enrichment). Text available at accessed 30 November 2011.

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versal Declaration of Human Rights98; Article 26(1) of the UN Declaration on the Rights of Indigenous People99; and Article 15 of the ILO Convention concerning Indigenous and Tribal Peoples in Independent Countries100. At the regional level the rules concerning such rights to property are Article 1 of Protocol 1 of the ECHR101; and Article 17 of the Charter of Fundamental Rights of the European Union102. Among the human rights instruments concerning the right to property, only certain rules explicitly refer to intellectual property, such as Article 17(2) of the Charter of Fundamental Rights of the European Union. Yet other rules adopt a broad concept of property, using language that permits the inclusion of intellectual property, such as Article 1 of Protocol 1 of the ECHR as interpreted by the ECtHR103. 98

Universal Declaration of Human Rights (adopted 10 December 1948) UNGA Res 217 A(III), establishing that “(1) Everyone has the right to own property alone as well as in association with others. (2) No one shall be arbitrarily deprived of his property”. Text available at accessed 30 November 2011 . 99 See (n 95 Chapter IV). This declaration gives protection not only to land and territories but also, for our purpose, to “resources which [indigenous people] have traditionally owned, occupied or otherwise used and acquired”. 100 ILO Convention concerning Indigenous and Tribal Peoples in Independent Countries (adopted 27 June 1989) No. 169, established that “1. The rights of the peoples concerned to the natural resources pertaining to their lands shall be specially safeguarded. These rights include the right of these peoples to participate in the use, management and conservation of these resources. 2. In cases in which the State retains the ownership of mineral or sub-surface resources or rights to other resources pertaining to lands, governments shall establish or maintain procedures through which they shall consult these peoples, with a view to ascertaining whether and to what degree their interests would be prejudiced, before undertaking or permitting any programmes for the exploration or exploitation of such resources pertaining to their lands. The peoples concerned shall wherever possible participate in the benefits of such activities, and shall receive fair compensation for any damages which they may sustain as a result of such activities”. Text available at accessed 30 November 2011. 101 As amended by Protocol No. 11 (adopted 20 March 1952), according to which “every natural or legal person is entitled to the peaceful enjoyment of his possessions. No one shall be deprived of his possessions except in the public interest and subject to the conditions provided for by law and by the general principles of international law”. Text available at accessed 30 November 2011. 102 Charter of Fundamental Rights of the European Union (n 96 Chapter IV), stating that “1. Everyone has the right to own, use, dispose of and bequeath his or her lawfully acquired possessions. No one may be deprived of his or her possessions, except in the public interest and in the cases and under the conditions provided for by law, subject to fair compensation being paid in good time for their loss. The use of property may be regulated by law in so far as is necessary for the general interest. /2. Intellectual property shall be protected”. 103 With the judgments of Smith Kline and French Laboratories Ltd v the Netherlands no 12633/87 (ECtHR, 4 October 1990) 66 DR 70; Melnychuk v Ukraine no 28743/03 (ECtHR, 5 July 2005); Anheuser-Busch v Portugal no 73049/01 (ECtHR, 11 January 2007); and Balan v Moldova no 19247/03 (ECtHR, 29 January 2008), the ECtHR characterized patents, copyrights and trademarks as property rights according to Article 1 Protocol 1 of the ECHR. (i)

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The proposal examined here correctly highlights that the rights to culture and to property are fundamental human rights, albeit of a qualified nature, referring as such “to those human rights which, while structurally individual, inevitably have a collective value also”104. Therefore States are obliged to respect, protect and fulfil those rights. Under this framework, the proposal analysed here suggests extending to IPRs the universal protection of human rights to culture and to property provided for by the existing mechanisms proParticularly, with the Anheuser-Busch judgment the ECtHR highlighted that “a ‘legitimate expectation’ of obtaining an ‘asset’ may also enjoy the protection of Article 1 of Protocol No. 1. Thus, where a proprietary interest is in the nature of a claim, the person in whom it is vested may be regarded as having a ‘legitimate expectation’ if there is a sufficient basis for the interest in national law” (para 65). The ECtHR went on to consider that “the applicant’s company legal position as an applicant for the registration of a trade mark came within Article 1 of Protocol No. 1, as it gave rise to interests of a proprietary nature. It is evident that the registration of a trade mark – and the greater protection it afforded – would only become final if the mark did not infringe legitimate third-party rights, so that, in that sense, the rights attached to an application for registration were conditional. Nevertheless, when it filed its application for registration, the applicant company was entitled to expect that it would be examined under the applicable legislation if it satisfied the other relevant substantive and procedural conditions. The applicant company therefore owned a set of proprietary rights – linked to its application for the registration of a trade mark – that were recognised under Portuguese law, even though they could be revoked under certain circumstances. This suffices to make Article 1 of Protocol No. 1 applicable in the instant case”. (ii) Similarly, in the Balan case the ECtHR noted that although the copyright of the appellant on a creative photograph was not disputed by the Moldovian government, this government used the copyrighted photograph as a background in identity cards without obtaining the appellant’s necessary consent for an allegedly existing general public interest. The ECtHR considered this interference disproportionate with the general public interest pursued by the Moldovian government and held that the government had violated the fundamental human right to IPRs ex Article 1 Protocol 1 to the ECHR, condemning it to enforce this right with pecuniary compensation for the applicant. (iii) The characterization of IPRs as fundamental human rights is rendered also by the Constitutions of certain States (USA) and the jurisprudence of certain national Constitutional Courts (Germany and Italy). (iv) On the characterization of IPRs as human rights in literature see François Dessemontet, ‘Copyright and Human Rights’ in Jan Kabel and Gerard Mom (eds), Intellectual Property and International Law (Kluwer Law International 1998) 116; Roberto Mastroianni, ‘Proprietà intellettuale e costituzioni’ [2005] AIDA 11; Geiger (n 102 Chapter III) 383; Orit Fischman Afori, ‘Human Rights and Copyright: The Introduction of Natural Law Considerations into American Copyright Law’ (2004) 14 Ford. Intell. Prop. Media & Ent. L.J. 500; Paul Torremans (ed), Intellectual Property and Human Rights: Enhanced Edition of Copyright and Human Rights (Kluwer Law International 2008); Klaus Dieter Beiter, ‘The Right to Property and the Protection of Interests in Intellectual Property – A Human Rights Perspective on the European Court of Human Rights’ Decision in Anheuser-Busch Inc. v. Portugal’ (2008) 39 IIC 714; Ottolia (n 292 Chapter I) 124; Dessemontet, ‘The ALI Principles’ (n 20 Chapter I) 42. (iv) However, compare the characterization of patents, rather than copyright, as human rights, see Rochelle Dreyfuss, ‘Patents and Human Rights: Where is the Paradox’ (2007) NYU Law and Economics Research Paper, No. 06-38 1. 104 Zagato (n 92 Chapter IV) para 4.

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hibiting their violations. In particular, according to the proposal examined here, among the existing mechanisms prohibiting human rights violations are the following: those posed by the human rights regional treaties such as the ECHR, and also those mechanisms set up by national norms that vest universal jurisdiction in the forum State courts to hear the claims brought for certain conduct committed outside the forum State. An example of such a national rule is the US Alien Tort Statute, which provides US District Courts with original jurisdiction over any civil action by an alien for a tort committed in violation of public international law or a treaty ratified by the United States outside US territory105. However, this proposal is not altogether convincing. Firstly, a number of the instruments noted above such as the UN Declaration on the Rights of Indigenous People, are soft international law instruments and thus nonbinding106. Secondly, as for the mechanisms prohibiting human rights violations provided for by the relevant human rights treaties such as the ECHR, those mechanisms only impose responsibility on States where the alleged violation of human rights occurs under the jurisdiction of these States107. To determine when that violation takes place under the jurisdiction of the defending State, the ECHR distinguishes between violations occurring on the national territory of the State party to the ECHR and violations occurring outside the Member State’s territory. As for the former, jurisdiction of the territorial State is presumed and the State may in principle be imputed with any violation resulting from that situation when this State has not complied with its obligations under the Convention. In particular, in such a case the State shall protect the rights under the Convention from violations committed by third parties108. Where a violation occurs outside the national territory of the relevant State party, the victim of an alleged human rights violation must demonstrate that the State in question exercised effective control over the territory within which the violation took place and did not comply with its obligations under the Convention to an extent commensurate with this control exercised in fact109. Furthermore, a negative obligation not to violate the rights under the Convention will only be imposed upon the State when it is acting through its organs110. Thus, it is apparent that the mechanisms established by the ECHR to prohibit violations of the rights to culture and property, and thus to IP, are 105

See 28 U.S.C. § 1350. They are seen to provide a “basic doctrinal framework for the protection of traditional knowledge as a means of conserving the distinct cultural identity of indigenous people”, as per Taubman and Leister (n 162 Chapter I) 172. 107 See Paolo Palchetti, ‘Azioni di forze istituite o autorizzate delle Nazioni Unite davanti alla Corte europea dei diritti dell’uomo: i casi Behrami e Saramati’ [2007] RDI 681-704. 108 Ibid. 109 Ibid. 110 Ibid. 106

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not designed to grant the universal protection of IPRs from misappropriation perpetrated by private corporations outside the territory of the defendant State. In fact, in those cases, the State against which an action is directed does not exercise any control over the territory of the foreign country where the violations occurred. Thirdly, those same mechanisms are adopted in certain cases in a manner that gives prevalence to the rights of private parties over the rights of entire communities or States. For example, in the Beyeler case111 the ECtHR gave priority to the right to property of an alleged owner of a painting over the right of the Italian State to have the painting back. This approach might cause problems with regard to the sui generis IPRs on traditional knowledge, genetic resources and folklore, since those rights are of a collective nature. Fourthly, as for the mechanisms prohibiting human rights violations provided for by the US Alien Tort Statute, the United States Court of Appeals for the Second Circuit, in the recent decision of Kiobel v Royal Dutch Petroleum on 17 September 2010112, maintained that corporations cannot be sued under the US Alien Tort Statute for violations of international law because “the concept of corporate liability […] has not achieved universal recognition or acceptance of a norm in the relations of States with each other”113. Thus, this decision may lead to the “demise of the Alien Tort Statute”114. As a consequence, the mechanisms established by this statute to prohibit the violations of the rights to culture and property, and thus to intellectual property, can no longer be relied upon to protect intellectual property from misappropriation by private corporations located outside the territory of the United States. 49. UNIDROIT Convention on Stolen or Illegally Exported Cultural Objects According to a third proposal, the universal protection of IPRs can be achieved in the future through the application of rules similar to those found in the UNIDROIT Convention on Stolen or Illegally Exported Cultural Objects signed in Rome on 24 June 1995115 (hereinafter: UNIDROIT Conven111

Beyer v Italy no 33202/96 (ECtHR, 5 January 2000). On this case see Maria Luisa Padelletti, ‘Il caso Beyeler di fronte alla Corte europea dei diritti dell’uomo’ [2000] RDI 781– 800; and Ubertazzi [2001] AIDA 271–277. 112 621 F.3d 111 (2nd Cir. 2010), judgment available at http://www.ca2.uscourts. gov/decisions/isysquery/9759bde9-a532-4af2-bf3f-f95a5b2f84c9/5/doc/06-4800-cv_opn.pdf> accessed 30 November 2011. 113 Ibid 49, point 2. This case is not divided into paragraphs. 114 Trey Childress, ‘Is it the End of the Alien Tort Statute?’ Conflict of Laws.net. News and Views in Private International Law (17 September 2010) available at accessed 30 November 2011, and there for further references. 115 UNIDROIT Convention on Stolen or Illegally Exported Cultural Objects (adopted 24 June 1995, entered into force 7 July 1998). As of 3 March 2006 the Convention is binding on

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tion). The UNIDROIT Convention applies to international claims for the restitution of cultural objects, which have been stolen or removed from the territory of a contracting State in a way that is contrary to its laws on the export of cultural objects. The Convention establishes that “the court or other competent authority of” a “Contracting State” shall “order the return of a cultural object illegally exported from the territory of” another contracting State under the request of this last State (Article 5), whenever the removal of the object from its territory significantly impairs its interests. Thus, to determine if the cultural object in question can be considered illegally exported, and to decide when it shall be returned, the requested State applies the law of the State of origin of the object in question. Moreover, the UNIDROIT Convention contemplates the difficulties which possessors of tangible cultural objects have in tracing their origins, and therefore establishes that the possessor of a stolen cultural object shall be compensated in exchange for returning the cultural object whenever it is demonstrated that he has acted in good faith and with due diligence in acquiring the object. Finally, according to this Convention a claim for restitution of a cultural object is subject to a limitation period. However, specific and more favourable rules relating to the limitation period are established for cultural objects that are part of a “public collection” (Article 3(7)) or which are among “important sacred or communally cultural objects belonging to and used by a tribal or indigenous community in a contracting State as part of that community’s traditional or ritual use” (Article 3(8)). According to this proposal, parallels exist between tangible cultural objects and IPRs, which support the argument for the application of rules similar to the UNIDROIT Convention norms concerning the protection of tangible cultural objects to the universal protection of IPRs. First, “the misappropriation of traditional knowledge […] can conceptually be compared to the unauthorised traffic and export of cultural objects, to the extent that the goal of legal protection in both cases is to ensure that legitimate right holders recover control over their misappropriated goods, whether traditional knowledge or cultural property”116. Secondly, as it is difficult for the possessors of tangible cultural objects to trace the origins of those objects, and since the UNIDROIT Convention contemplates the situation where the possessor acts in good faith with regards to a stolen cultural object, analogously, it can be difficult for a patent applicant to trace the origins of traditional knowledge associated with a genetic resource, and therefore a good faith patent applicant who has acted with due diligence should be subject to a lesser sanction when it subsequently appears that the invention in question had its basis in traditional knowledge. Thirdly, the justification for increased protection of objects belonging to a 31 States. Text available at > accessed 30 November 2011. 116 De Werra (n 69 Chapter IV) 162.

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tribal or indigenous community “converges with the protection of traditional knowledge, which also targets the traditional use of local resources”117. In addition, the justification for increased protection of cultural objects belonging to public collections “derives in particular from the fact that these goods are inventoried or otherwise identified”, and therefore “it could similarly be expected that the level of protection against unauthorised misappropriation should be increased with respect to” IPRs “for which there exists some publicity”118. Fourth, the UNIDROIT Convention encourages the submission of disputes to arbitration, which “as a method of dispute resolution can and should be encouraged with regard to disputes arising from cases of misappropriation of traditional knowledge”119. In sum, the UNIDROIT Convention provides a good model for regulating the misappropriation of IPRs. However, since “the protection of tangible cultural property differs by its very nature from the protection of traditional knowledge”120 the proposal here discussed, rather than invoking an extension of the UNIDROIT Convention itself, is in favour of the future adoption of a separate international instrument incorporating the UNIDROIT Convention’s “several valuable concepts … [that] could help shape an appropriate system of protection against the misappropriation of traditional knowledge”121.

III. Territorial and Universal IPRs Protection Inside the IP Systems III. Territorial and Universal IPRs Protection Inside the IP Systems 50. Theses According to which the Territoriality Principle Establishes Implicit Exclusive Jurisdiction Rules: the Voda, the UK Court of Appeal’s Lucasfilm and the Gallo Judgments, Referral The proposals for the protection of ICH from misappropriation analysed so far, with particular reference to the first and second proposals, are all based on the same premise that is also adopted by the Voda, the UK Court of Appeal’s Lucasfilm and the Gallo judgments122, namely that the universal protection of ICH from misappropriation cannot be achieved throughout the IPRs system owing to the territorial nature of IPRs and the territoriality principle123. The territoriality principle would allegedly be an international procedural law cri117

Ibid. Ibid. 119 Ibid 165. Another similarity is that “delimitation between tangible and intangible cultural heritage create difficulties since both forms of heritage may overlap”, as such de Miguel Asensio, ‘Transnational Contracts’ (n 162 Chapter I) para 1. 120 De Werra (n 69 Chapter IV) 159. 121 Ibid 165. 122 See supra, paras 3 and 7. 123 Ibid. 118

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terion that would vest exclusive subject matter jurisdiction in the courts of the State that granted the IPR concerned. Also, according to the proposals analysed here, the territoriality principle would serve as a conflict of laws connecting factor that would determine as the applicable law the lexi loci protectionis, that being the law of the country for which protection of the IPR is sought. Thus, the territoriality principle would require the applicant to initiate separate legal actions in each and every country in which, for example, a disputed patent application had been filed or granted, and the courts seized of those disputes would always apply their respective territorial laws as the lex loci protectionis. However, when the IPR involved has its origin in a country other than the forum State, the law of this State, applicable by virtue of it being the lex loci protectionis, ignores the misappropriated IPR and therefore cannot protect it. 51. The Territoriality Principle in the CUP, CUB, and TRIPs Agreement does not Pose Exclusive Jurisdiction Rules Yet, these theses are not convincing with respect to the territoriality principle. Firstly, the territoriality principle does not vest exclusive subject matter jurisdiction in the courts of the States that granted the IPR in question124. Secondly, the territoriality principle does not always impose the application of the lex loci protectionis. Therefore the territoriality principle does not prevent a case relating to the misappropriation of an IPR, having occurred in many countries, from being decided by a single competent court, according to the universality principle. Also, the territoriality principle does not prevent the courts seized from making a decision, where the entire IPR misappropriation has occurred in many countries, according to a single applicable law. These conclusions are highlighted by the following remarks which relate first to the interpretation of the territoriality principle as posed by the CUP, CUB, and TRIPs agreement; and second to the interpretation of the territoriality principle with respect to other rules. 52. Non-acceptability of the Opinion that the Territoriality Principle in the CUP, CUB, and TRIPs Agreement Poses Exclusive Jurisdiction Rules A first opinion maintains that the territoriality principle posed by the CUP, CUB, and TRIPs agreement would impede the adjudication of issues related to foreign IPRs in the forum State and would thus ground exclusive jurisdic124

On the territoriality principle and on the reasons against its interpretation as an international jurisdiction rule in relation to IPRs, see Josef Drexl, ‘Internationales Immateralgüterrecht’ (2006) 11 Münchener Kommentar zum Bürgerlichen Gesetzbuch (München, Beck) 819, 820; Boschiero, ‘Il principio’ (n 207 Chapter I) 99; Dinwoodie, ‘Developing a Private International’ (n 28 Chapter IV) 711; Peukert (n 72 Chapter IV).

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tion rules. Particularly, Article 5(2) CUB is interpreted as containing a choice of law rule by stating that the enjoyment of the creator’s rights “shall be independent of the existence of protection in the country of origin of the work” and that “the extent of protection, as well as the means of redress afforded to the author to protect his rights, shall be governed exclusively by the laws of the country where protection is claimed”125. The opinion in issue is based on the following arguments. A first argument emphasises that the territoriality principle is a consequence of the nature of IPRs, namely of their being monopolies of the States granted through administrative acts of State, as well as expressions of the public policy of their granting State126. This characteristic would then impede their adjudication by foreign courts. A second argument considers that, unlike tangible goods, IPRs do not preexist in nature, but are a creation of the legislators, whose laws make them spatially limited to the national territory. The spatial limitation of IPRs implies that they can be adjudicated only by the courts of their granting States and according to their substantive laws127. A third argument highlights that intangible goods are indeed similar to tangible immovable goods. In fact, both are spatially limited, and therefore the local action doctrine of tangible goods also applies to intangible goods and 125 For the view that Article 5(2) CUB (n 177 Chapter I) poses a choice of law rule and for the literature adopting an opposite approach see the references in see Moura Vicente (n 209 Chapter I) 270 and Basedow, ‘Foundations of Private International Law’ (n 148 Chapter I) 9 footnote 19, both of whom endorse the latter opinion. See Basedow, ‘Foundations of Private International Law’ (n 148 Chapter I) 9 footnote 19, according to whom “in light of this debate, the unequivocal reference of Article 8 Rome II to the lex loci protectionis cannot be regarded as redundant”. See the Rome II Regulation (n 151 Chapter I) and supra, para 5 and infra para 56. 126 See Tullio Ascarelli, Teoria della concorrenza e dei beni immateriali (3rd edn, Milano, Giuffrè 1960) 341; Ugo Draetta, Il regime internazionale della proprietà industriale (Milano, Giuffrè 1967); Mario Fabiani, ‘voce Diritti d’autore’ Novissimo Digesto it., Appendice II, (Torino 1981) 1122; Eugen Ulmer, ‘Copyright and Industrial Property’ in Eugen Ulmer (ed), International Enyclopedia of Comparative Law (Vol. 14, Tübingen, Mohr Siebeck 1987) 5; Riccardo Luzzatto, ‘Problemi internazionalprivatistici del diritto d’autore’ [1989] RDIPP 279; Riccardo Luzzatto, ‘Proprietà intellettuale e diritto internazionale’ Studi di diritto industriale in onore di Adriano Vanzetti (Milano, Giuffrè 2004) 900; Riccardo Luzzatto, ‘voce Proprietà in generale (dir. int. priv.)’ Enciclopedia diritto (Vol. XXXVII, Milano, Giuffrè 1988) 313; Giorgio Badiali, Diritto d’autore e conflitto di leggi (Napoli, Edizioni Scientifiche Italiane 1990) 18; Jean Combacau, ‘La localisation territoriale des marques’ Mélanges Marcel Plaisant, Étude sur la propriété industrielle, littéraire, artistique (Paris, Sirey 1960) 61. For further references see Boschiero, ‘Il principio’ (n 207 Chapter I) 36. See also the Lucasfilm (n 29 Chapter I) and Gallo (n 28 Chapter I) judgments, referred to above. For a similar argument recalling the historical territorial nature of royal privileges see Jane Ginsburg, ‘The Private International Law of Copyrights in an Era of Technological Change’ (1998) 273 Recueil des Cours 257. 127 See the references in Boschiero, ‘Il principio’ (n 207 Chapter I) 36 footnote 9.

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determines that the latter like the former can be adjudicated only by the courts of their granting States and according to their substantive laws128. This argument corresponds to the one invoking the extension of the Moçambique rule to IPRs, which will be referred to in paragraph 67. A fourth argument maintains that where PIL national systems do not establish PIL provisions to determine the applicable laws to the IPRs issues involved, the courts seized cannot apply foreign laws but have to apply the lex fori to the IPRs issues. However, due to the territorial nature of IPRs the lex fori does not recognise the existence of foreign IPRs and therefore their issues cannot be adjudicated by the courts of the forum State129. A fifth argument maintains that the territoriality principle should be regarded as a reason of public order and that asserting jurisdiction in disputes on foreign IPRs encroaches upon the public order limit130. A sixth argument is adopted inter alia by the Voda, the UK Court of Appeal’s Lucasfilm and the Gallo judgments, according to which the CUP, the CUB and the TRIPs agreement establish the territoriality principle, which does not allow any interference in the foreign country’s IPR system and interference purportedly occurs whenever a domestic court adjudicates a foreign IPR issue131. Thus, it is argued that the territoriality principle proscribes such adjudication. The absence of an “express jurisdictional-stripping statute”132 in the CUP, CUB, and TRIPs agreements is alleged to lend further support to this position133. In conclusion, the sixth argument of this opinion purports that the territoriality principle in the CUP, CUB, and TRIPs agreements establishes an implicit exclusive jurisdiction rule with respect to both IPR validity and infringement disputes. However, this opinion and its grounding arguments are questionable for the following reasons. Its first argument is contrary to the modern conception of IPRs as private rights, where the granting of IPRs no longer constitutes acts of State or expressions of the States’ public interests, since IPRs pursue directly private interests, and only indirectly public ones, and are therefore pri-

128 See inter alia the Lucasfilm judgment (n 29 Chapter I) 174–186, that recalls the Moçambique rule, which will be addressed at para 67. 129 Badiale (n 126 Chapter IV), who adopted his thesis under the previous Italian PIL system, which did not establish a rule on intangible goods. 130 See the references in Marta Pertegás Sender, Cross-Border Enforcement of Patent Rights: An Analysis of the Interface Between Intellectual Property and Private International Law (Oxford, OUP 2002) 25. 131 See supra, para 7. 132 Voda (n 31 Chapter I) 899. 133 See supra, para 7.

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vate rights. Consequently, IPRs shall be submitted to the normal functioning of private international law, like any other private right134. Its second argument does not consider that as for the coming into being of IPRs, those rights are not unlike other proprietary rights over tangible goods. In fact, first also with respect to IPRs, it is possible to find in nature the goods that incorporate IPRs, in the same way that it occurs with respect to the tangible goods that incorporate proprietary rights. Second, also with respect to those last proprietary rights, in the same way that it occurs with regard to any private right, it is possible to maintain that they are attributed and recognised by national laws, and laws are always territorial in nature. However, the territorial scope of the law recognising a right on a tangible good does not preclude its submission to the PIL rules. Thus, the territorial scope of IPRs shall not impede the functioning of the PIL rules in the IP field either135. The third argument is not entirely convincing for all the reasons against the extension of the Moçambique rule to IPRs136. The fourth argument is unconvincing since even in the absence of PIL rules specifically related to IPRs, PIL has a “general attitude” towards regulating any case of a private nature. Thus, the applicable law for IPRs cases should be determined according to other PIL rules that can encompass them137. The fifth argument is questionable since the public policy limit relates to the applicable law as well as to the recognition and execution of foreign judgements fields, but does not play any role with respect to the issue of allocation of jurisdiction138. Finally, the territoriality principle as posed by the CUP, CUB, and TRIPs agreement cannot be interpreted as a conflict of jurisdiction rule for other arguments that are grounded on Articles 31 and 32 of the Vienna Convention on the Law of Treaties of the year 1969139. 134

Roberto Mastroianni, Diritto internazionale e diritto d’autore (Milano, Giuffrè 1997) 382; Schauwecker (n 207 Chapter I) 27. 135 Bouche (n 207 Chapter I) 24. 136 On the Moçambique rule see infra, para 67. 137 See infra, the immediately following remarks. 138 Pertegás Sender, Cross-Border (n 130 Chapter IV) 25. On the public policy exception with regard to the issue of recognition and enforcement of foreign judgments on IPRs see infra, para 73. 139 Article 31 of the Vienna Convention on the Law of Treaties (adopted 23 May 1969, entered into force 27 January 1980) 1155 UN Treaty Series 331, establishes that “1. A treaty shall be interpreted in good faith in accordance with the ordinary meaning to be given to the terms of the treaty in their context and in the light of its object and purpose. / 2. The context for the purpose of the interpretation of a treaty shall comprise, in addition to the text, including its preamble and annexes: / (a) any agreement relating to the treaty which was made between all the parties in connection with the conclusion of the treaty; / (b) any instrument which was made by one or more parties in connection with the conclusion of the treaty and

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A preliminary argument against the opinion here criticised is based, then, on the literal interpretation of the rules on the territoriality principle of the CUP, CUB, and TRIPs agreement. Article 31(1) of the Vienna Convention prescribes interpreting a norm of an international treaty according to “the ordinary meaning to be given to” its “terms”. Indeed, the terms of the norms on the territoriality principle of the CUP, CUB, and TRIPs agreement do not refer to either the issue of allocation and distribution of the international jurisdiction among member States, or any international jurisdictional criterion, whether of an exclusive nature or not. A second argument against the opinion here criticised is based on the teleological interpretation of the CUP, CUB, and TRIPs agreement. Article 31(1) of the Vienna Convention prescribes interpreting a norm of an international treaty “in light of its object and purpose”. Firstly, the object and purpose of any international convention is generally to establish a situation of cooperation between member States on a certain issue. Yet, “nothing seems more contrary to the spirit of cooperation and of mutual trust which are necessary to the elaboration of a Convention than the introduction of egoistic fora such as the ones posing exclusive jurisdiction, which, paradoxically, are grounded on mistrust”140. Second, with specific reference to the CUP, CUB, and TRIPs agreement, their object and purpose are the acceptance that each IPR shall be considered autonomous with respect to other foreign IPRs with the same object of protection (independence/territoriality principle), the protection of foreign nationals accepted by the other parties as an instrument related to the treaty. / 3. There shall be taken into account, together with the context: (a) any subsequent agreement between the parties regarding the interpretation of the treaty or the application of its provisions; / (b) any subsequent practice in the application of the treaty which establishes the agreement of the parties regarding its interpretation; / (c) any relevant rules of international law applicable in the relations between the parties. / 4. A special meaning shall be given to a term if it is established that the parties so intended”. Article 32 of the Vienna convention on the “supplementary means of interpretation” establishes that “recourse may be had to supplementary means of interpretation, including the preparatory work of the treaty and the circumstances of its conclusion, in order to confirm the meaning resulting from the application of article 31, or to determine the meaning when the interpretation according to article 31: / (a) leaves the meaning ambiguous or obscure; or / (b) leads to a result which is manifestly absurd or unreasonable”. On these rules see recently Enzo Cannizzaro (ed), The Law of Treaties Beyond the Vienna Convention (Oxford, OUP 2011) within which see specifically the following papers: Mark Villiger, ‘The Rules on Interpretation: Misgivings, Misunderstandings, Miscarriages. The “Crucible” Intended by the International Law Commission’ 105-122; Pierre-Marie Dupuy, ‘Evolutionary Interpretation of Treaties: Between Memory and Prophecy’ 123-137; Luigi Sbolci, ‘Supplementary Means of Interpretation’ 145-163. 140 “Rien ne semble plus contradictoire avec l’esprit de coopération et de confiance nécessaire à l’élaboration d’une convention que l’introduction de fors égoïstes tels que les fors exclusifs, fondés paradoxalement sur la méfiance”, according to Fernández Arroyo, ‘Compétence exclusive’ (n 45 Chapter I) 109.

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(assimilation/territoriality principle), and increasing the substantive and procedural IPRs protection in member States to a minimum level of protection141. In contrast, the CUP, CUB, and TRIPs agreement do not have as their object and purposes the allocation and distribution of the international jurisdiction among member States142. This conclusion was reached by the ECJ in the Tod’s case where, Tod’s claimed an infringement of its registered designs for shoes bearing the Tod’s and Hogan trademarks before a French court against a French competitor143. The French competitor countered with a plea of inadmissibility contending that under the Berne Convention Tod’s was not entitled to claim copyright protection in France for designs that did not qualify for such protection in Italy. In this case, after a referral by the French court to the ECJ, this last court established that “the purpose of” the Berne Convention “is not to determine the applicable law on the protection of literary and artistic works, but to establish, as a general rule, a system of national treatment of the rights appertaining to such works”144, and therefore “Article 12 EC [...] must be interpreted as meaning that the right of an author to claim in a Member State the copyright protection afforded by the law of that State may not be 141

Braithwaite and Drahos (n 41 Chapter I) 58. Drexl, ‘Internationales Immateralgüterrecht’ (n 124 Chapter IV) 819; Boschiero, ‘Il principio’ (n 207 Chapter I) 81; Dinwoodie, ‘Developing a Private International’ (n 28 Chapter IV) 711. See also S.J. Schaafsma, Intellectuele eigendom in het conflictenrecht. De verborgen conflictregel in het beginsel van nationale behandeling (Kluwer 2009) 202-219. The book is written in Dutch, with summaries in English and French. However, the author kindly summarized and translated for me in a personal e-mail, dated 11 November 2011, the part of the book relevant with respect to exclusive jurisdiction, namely arguing that “in 19th century conflict-of-law, intellectual property law was governed by the principle of strict territoriality. This principle consisted of two elements: material territoriality and formal territoriality. Material territoriality means that a national law only applies to events which take place on national territory; in modern terms: the lex protectionis. Formal territoriality means that a national court may only apply its own national law (in that time it was considered repugnant to national sovereignty to apply foreign intellectual property law); in modern terms: the court shall only apply the lex fori. So, in fact, the 19th century principle of strict territoriality is the cumulative application of the lex protectionis (material territoriality) and the lex fori (formal territoriality): the protection is governed exclusively by the law of the country for which the protection is claimed, which is by definition the country where the protection is claimed (because no other court is allowed to apply this law). This principle of strict territoriality eroded in the course of the 20th century. The material territoriality element survived, and is now called the lex protectionis principle. The formal territoriality element developed in a different way. As from the 1950’s, especially in continental Europe, people didn’t understand formal territoriality any longer and they began to confuse this element (which is conflict-of-law element) with jurisdiction. They began to interpret it as an exclusive jurisdiction ground. This confusion became widely accepted, and is finally codified (with a restricted scope of application, namely only concerning the validity-issue) in art. 16(4) of the Brussels Convention”. 143 Tod’s case (n 274 Chapter I) and supra, para 8. 144 Ibid 32. Basedow, ‘Foundations of Private International Law’ (n 148 Chapter I) 9. 142

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subject to a distinguishing criterion based on the country of origin of the work”145. Thus, the ECJ conclusions that the “purpose of the” Berne “Convention is not to determine the applicable law on the protection of literary and artistic works, but to establish, as a general rule, a system of national treatment of the rights appertaining to such works”146, can easily be extended to the international jurisdiction issue. As a result, the purpose of the Berne Convention is not to determine which jurisdiction can grant universal protection to IPRs147. Moreover, the same conclusion is reached by other important courts around the world, namely inter alia in the US Itar-Tass judgment148 and in the Japanese Coral Sand decision149. Finally, the same conclusion is supported, as will be explained hereinafter, by the preparatory works of the CUP, CUB, and TRIPs agreement and by the circumstances in which they were concluded150. A third argument against the opinion here criticized is based on the systematic stricto sensu interpretation of the CUP, CUB, and TRIPs agreements. In fact, Article 31(1) of the Vienna Convention prescribes interpreting a norm of international treaties “in their context”. According to Article 31(2) of the same convention "the context for the purpose of the interpretation of a treaty 145

Ibid 37. Tod’s (n 274 Chapter I) paras 32-33. The same conclusion with respect to the applicable law issue is reached by Richard Fentiman, ‘Choice of Law and Intellectual Property’ in Drexl and Kur (n 13 Chapter I) 133; Jean-Sylvestre Berge, La protection internationale et communautaire du droit d’auteur. Essai d’une analyse conflictuelle (Paris, LGDJ 1996) 204; Jean-Sylvestre Berge, ‘Droit d’auteur, conflit de lois et réseaux numériques: rétrospective et prospective’ [2000] RCDIP 366; Patry (n 41 Chapter I) 413; Pertegás Sender, Cross-Border (n 130 Chapter IV) 233; Pertegás Sender, ‘Intellectual Property and Choice of Law Rules’ in Alberto Malatesta (ed), The Unification of Choice of Law Rules on Torts and Other NonContractual Obligations in Europe (Padova, CEDAM 2006) 227; Mireille van Eechoud, Choice of Law in Copyright and Related Rights: Alternatives to the Lex Protections (The Hague, Kluwer 2003) 107; Boschiero, ‘Il principio’ (n 207 Chapter I) 45. 147 See supra, para 8. 148 US Court of Appeals for the Second Circuit, Itar-Tass News Agency v Russian Kurier, Inc., 153 F.3d 82 (2d Cir.1998), where Judge Newman held that the national treatment posed by the CUB is not a conflict of laws principle, but rather “simply assures that if the law of the country of infringement applies to the scope of substantive copyright protection, that law will be applied uniformly to foreign and domestic authors” (para 8). Therefore, according to the US court national treatment is a non-discrimination principle. As in the Tod’s case (n 274 Chapter I) the conclusions reached with respect to conflict of laws issues are easily extendable to the international jurisdiction issue leading to the result that the purpose of the CUB is not to determine the international jurisdiction to grant protection to the IPRs at stake either. See infra, this same para. On this case see Metzger, ‘Applicable Law Under The CLIPPrinciples’ (n 2 Chapter I) 160. 149 See Hanrei Jih (n 63 Chapter II). On this case see Dai Yokomizo, ‘Intellectual Property Infringement on the Internet and Conflict of Laws’ (May 2011) AIPPI Journal 105. 150 See below, in this same paragraph. 146

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shall comprise, in addition to the text, including its preamble and annexes: / (a) any agreement relating to the treaty which was made between all the parties in connection with the conclusion of the treaty; / (b) any instrument which was made by one or more parties in connection with the conclusion of the treaty and accepted by the other parties as an instrument related to the treaty”. Certain rules of the CUP, CUB, and TRIPs agreements refer only to the granting or the recognizing State. However, other rules of the CUP, CUB, and TRIPs agreement refer to other countries. So, for instance with regard to the CUB, certain Articles refer to the State of origin of the protected work151; other norms mention the country of first publication152; other norms indicate the State of nationality of the author153; other rules designate the State of the habitual residence or domicile of the author or of the copyright owner154; other provisions mention the country to which protection is requested155; other norms refer to the country for which protection is claimed156; and one other Article indicates the forum State157. Thus, the interpretation of these rules as implicitly conferring exclusive jurisdiction on the courts of each of the States referred to by them is apparently contrary to the exclusive nature of the jurisdiction of the granting State allegedly posed by the territoriality principle. A fourth argument against the opinion here criticized is based on the systematic lato sensu interpretation of the CUP, CUB, and TRIPs agreements. In fact, Article 31(3) of the Vienna Convention prescribes interpreting a norm of an international treaty taking “into account, together with the context: (a) any subsequent agreement between the parties regarding the interpretation of the treaty or the application of its provisions; / (b) any subsequent practice in the application of the treaty which establishes the agreement of the parties regarding its interpretation; / (c) any relevant rules of international law applicable in the relations between the parties”. As far as Article 31(3)(a) is concerned, the parties of the CUP, CUB, and TRIPs agreements concluded other multilateral agreements specifically on IP law but none of them addresses the cross-border enforcement of IPRs, or encompasses any explicit provisions on the territoriality principle as a conflict of jurisdiction provision determining an exclusive competent court158. Yet, other international treaties concluded between certain 151

Articles 2(7), 5(1) and 5(3). Article 6(1). 153 Articles 3(1)(a), 3(1)(b), 4(b), 6(1), 14ter(2) and 15(4). 154 Articles 3(2), 4(a), 4(b), 6(1) and 14bis(2)(c). 155 Articles 5(2), 6bis(2), 6bis(3), 7(8), 13(3), 14bis(2)(a),14bis(2)(c), 14ter(2) and 18(2). 156 Article 16(1) and Article 13(3) referring to “country where [recordings] […] are treated as infringing”. 157 Article 16(3). See Badiali (n 126 Chapter IV). On the issue and on other relevant references see Boschiero, ‘Il principio’ (n 207 Chapter I) 42, and also there for further references. 158 See for instance the ACTA, on which see supra, para 1. See all other agreements referred to supra, para 5. 152

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States that are also parties to the CUP, CUB, and TRIPs agreements could be relevant in interpreting the territoriality principle posed by them. Among these other agreements, are the Brussels Convention, which was interpreted by the ECJ as extending the scope of exclusive jurisdiction to registered IPRs validity issues incidentally raised, and the Lugano Convention, which extends the scope of exclusive jurisdiction explicitly to registered IPRs validity issues incidentally raised159. Indeed, except for these conventions exclusive jurisdiction rules concerning IPRs cases cannot be found, even with a limited scope, in any other multilateral international conventions160. In contrast, the inclusion of such exclusive jurisdiction, even with a limited scope, in The Hague Preliminary Draft Convention on Jurisdiction161 was one of the principal reasons for the failure of that draft162. With respect to Article 31(3)(b) and the practice of states parties to the CUP, CUB, and TRIPs agreement related to the application of their provisions on the territoriality principle, it is therefore reasonable to conclude that exclusive jurisdiction rules do not express a practice that is concordant, commune and constant, thus univocal and repetitive, and are not grounded in the States’ opinio juris ac necessitatis but rather on questionable political and opportunistic reasons163. With respect to Article 31(3)(c), among the many different rules of international law applicable to the relations between the parties of the CUP, CUB, and TRIPs agreements, those that are relevant here are the rules on the avoidance of a denial of justice; the rules posing the doctrine (rule) of the jurisdiction by necessity (forum necessitatis); and the rules establishing the fundamental human right of access to a court, which as will be explained in chapter VI of this book, are contrary to exclusive jurisdiction provisions. A fifth argument against the opinion here criticized is based on the historical-evolutionary interpretation of the CUP, CUB, and TRIPs agreements. In fact, Article 31(3)(c) of the Vienna Convention prescribes interpreting a norm of an international treaty taking “into account, together with the context: […] (c) any relevant rules of international law applicable in the relations between the parties”. Thus, this Article permits taking into account rules of international law that apply currently, even though they did not exist at the time of the adoption of the CUP, CUB, and TRIPs agreement. Indeed, among the rules that apply today and did not apply at the time of the adoption of at least the CUP and CUB are those of public international law that will be examined in chapter VI of this book on the avoidance of a denial of justice; those posing 159 See the ECJ GAT v LuK decision (n 32 Chapter I); see Article 22(4) of the Lugano Convention (n 69 Chapter I). See supra, paras 1 and 8. 160 See supra, chapter II. 161 See supra, para 1. 162 See supra, chapter II. 163 Ibid.

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the doctrine (rule) of the jurisdiction by necessity (forum necessitatis); and those establishing the fundamental human right of access to a court. These rules confirm that the CUP, CUB, and TRIPs agreements cannot be interpreted as establishing any exclusive jurisdiction criteria. A sixth reason against the opinion here criticized relies on an argument ab inconvenienti that emphasises the practical inconveniences arising out of exclusive jurisdiction rules, such as the ones related to duplication of proceedings164. A final argument against the opinion here criticized is based on the supplementary means of interpretation. In fact, according to Article 32 of the Vienna Convention “recourse may be had to supplementary means of interpretation, including the preparatory work of the treaty and the circumstances of its conclusion, in order to confirm the meaning resulting from the application of Article 31”. Indeed, the preparatory works of the CUP, CUB, and TRIPs agreement do not refer to either the issue of allocation and distribution of the international jurisdiction among member States or any international jurisdictional criteria, either of an exclusive nature or not165. 53. Non-acceptability of the Opinion that the Territoriality Principle in the CUP, CUB, and TRIPs Agreement Impedes the Courts Seized from Adopting PIL Rules A second opinion maintains that while the territoriality principle does not pose any implicit exclusive jurisdiction rules, it has a substantive nature and impedes the court seized from adopting PIL rules to determine the applicable law to the IPRs case concerned166. According to this thesis, the territoriality principle would be the theoretical scheme to be used in order to limit the State’s legislative competences in matters of IP rights167. Thus, the territoriality principle would imply that each State recognizes the existence, in its territory, of only one right of exclusivity for each subject matter of an intellectual property right and in this connection is part and parcel of the doctrine of public international law, insofar as it derives from the sovereignty of each State168. Therefore, the applicable law concerning the existence and scope of IPRs would be always individualised in the law of the State that granted the IPR in question, not as a consequence of the PIL functioning, but as a consequence of the fulfilment of the States’ generic obligation to recognize the for-

164

See infra, chapter VI. On the notion of duplication of proceedings see supra, para 5. De Miguel Asensio, ‘Cross-border’ (n 6 Chapter I) 115-116. 166 Luzzatto, ‘Problemi internazionalprivatistici’ (n 126 Chapter IV) 278. 167 Ibid. 168 Luzzatto, Proprietà intellettuale’ (n 126 Chapter IV) 907. 165

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eign law as a constitutive element of the legal order or personality of the State to which the right pertains169. In contrast, PIL rules would still play an important role with respect to other IPRs issues. Namely, in the absence of a PIL rule expressly addressing IPRs, ownership would enter into the category of tangible goods and shall therefore be regulated by the law of the State granting them protection as the lex rei sitae; the IPRs infringements would pertain to the category of illegal acts and shall be regulated by the lex loci delicti; and the author’s moral rights in relation to copyright would pertain to the category of personality rights and shall be regulated by the lex patriae. However, this opinion is unconvincing in that it excludes the applicability of PIL rules to the cases relating to foreign IPRs170. In fact, this thesis maintains that the existence of a foreign IPR should be acknowledged by virtue of the recognition of the law of its granting State, rather than by virtue of the functioning of the PIL rules. However, this thesis leads to the same practical conclusion as would be reached applying PIL rules and thus applying the law of the IPRs granting State by reason of it being designated as the applicable law by the PIL rules in issue171. Moreover, the distinction between existence and scope of the IPRs and infringement matters and the submission of just the latter to the PIL mechanisms is questionable for several reasons. First, from a PIL perspective the issue of the IPR’s existence and scope is not an incidental question, but is a portion of the principal issue; the incidental questions can be submitted to an applicable law other than the principal issue, whereas the portions of the principal issue shall be ruled according to the same applicable law as the principal issues themselves; thus, the existence and scope of the IPRs should be submitted to the same applicable law as the one that rules the principal issue, namely inter alia the IPRs infringement172. Second, the submission of the issue related to the IPRs existence and scope to a law in principle other than the law regulating inter alia their ownership or infringement implies submitting aspects pertaining to the same juridical relationship to different laws. This implies a dépeçage173, and dépeçage in turn implies consequent 169

Luzzatto, ‘Problemi internazionalprivatistici’ (n 126 chapter IV) 274 footnote 1. Boschiero, ‘Il principio’ (n 207 Chapter I) 48. 171 Ibid. 172 Boschiero, ‘Il principio’ (n 207 Chapter I) 56. 173 On dépeçage in PIL see Willis Reese, ‘Dépeçage: a Common Phenomenon in Choice of Law’ (1973) 73 Colum. L. Rev. 58; Christian Wilde, ‘Dépeçage in the Choice of Tort Law’ [1968] So. Cal. L. Rev. 329–365; Paul Lagarde, ‘Le “dépeçage” dans le droit international privé des contrats’ [1975] RDIPP 649; Erik Jayme, ‘Betrachtungen zur “dépeçage” im internationalen Privatrecht’ in Hans-Joachim Musielak and Klaus Schurig (eds), Festschrift für Gerhard Kegel zum 75 Geburtstag 26 Juni 1987 (Kohlhammer 1987) 253–268. With regards to dépeçage in private international law in terms of personal status compare in Annuaire de l’Institut de droit international [1987] I, 62 the observations of: Francesco Capotorti 170

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difficult problems of “adaptation”174, and therefore should be avoided in private international law175. Third, the dépeçage in this case is also “useless, since the law applicable to the IPR protection country seems to be better placed [than the law applicable to the tort] to determine the protection modalities and remedies established at the IP damaged owner disposal”176. And finally, nowadays in the EU the submission of IPRs infringement issues to the law applicable to the civil liability rather than to the lex loci protectionis would be contrary to Articles 8 and 15 of the EC Rome II Regulation177. 54. Non-acceptability of the Opinion that the Territoriality Principle in the CUP, CUB, and TRIPs Agreement has only a Substantive Nature A third opinion maintains that, on the one hand the territoriality principle does not pose any implicit exclusive jurisdiction rules and does not impede the courts seized from adopting PIL rules to determine the applicable law to the IPRs issues, but on the other hand the territoriality principle does not refer to any applicable law. Thus, this applicable law would be determined according to PIL rules related to specific IPRs issues. In their absence the applicable law should be determined through the application of other PIL rules that can encompass the IPRs issues involved, such as the PIL provisions on civil liability in general for issues of IPRs infringement178, the PIL norms on tangible goods as for IPRs scope and validity issues179, or the PIL rule designating the law of

at 358; Pierre Gannagé at 363; Erik Jayme at 374; Yvon Loussouarn at 335; Juan Antonio Carrillo–Salcedo at 361; Ronald Graveson at 372. On the use of the dépeçage technique in the Rome Convention see the following: Campbell McLachlan, ‘Splitting the Proper Law in Private International Law’ [1990] Brit. Y.B. Int’l L. 311-337; Fausto Pocar, ‘Brevi appunti sull’incidenza della Convenzione di Roma relativa alla legge applicabile ai contratti sul diritto italiano’ in Studi in ricordo di Antonio Filippo Panzera, II: Diritto internazionale (Bari, II, 1995) 696; Richard Plender and Michael Wilderspin, The European Contracts Convention. The Rome Convention on the Choice of Law for Contracts (2nd end, London, Sweet & Maxwell 2001) 100–101; See Benedetta Ubertazzi, La capacità delle persone fisiche nel diritto internazionale privato (Padova, CEDAM 2006) 127. 174 On adaptation in PIL see Giorgio Cansacchi, Scelta e adattamento delle norme straniere richiamate (Torino, 1939); Nuria Bouza Vidal, Problemas de adaptación en Derecho internacional privado y interregional (Madrid, Tecnos 1977); Erik Jayme, ‘Identité culturelle et intégration: le droit international privé postmoderne’ (1995) I 251 Recueil des Cours 145. 175 Boschiero, ‘Il principio’ (n 207 Chapter I) 57. 176 Ibid, according to whom “tutto sommato inutile, posto che la legge del Paese protettore pare la più adatta a determinare le modalità di protezione e i rimedi offerti al titolare leso”. 177 Ibid, recalling the Rome II Regulation (n 151 Chapter I). On Article 8 of the Rome II Regulation see infra, para 56. 178 Auteri (n 207 Chapter I) 103. 179 See the references in Gian Battista Origoni della Croce, ‘Precisazioni di diritto internazionale privato e processuale in tema di marchi e brevetti’ (1973) 22 Riv. Dir. Ind. 105.

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the State where the enterprise producing goods under a certain trademark is domiciled180. However, this opinion is not acceptable for the same reasons rendered against extending to IPRs the Moçambique rule devised for lands that will be examined in paragraph 67. Moreover, the thesis is unconvincing because the application of PIL rules that are expressly designed to address property rights on tangible goods to IPRs clearly goes against the letter of those PIL rules181. Also, this thesis applies the connecting factor of the situs rei to rights that are not localizable, as such, rendering it difficult to determine their applicable law182. 55. Non-acceptability of the Opinion that the Territoriality Principle in the CUP, CUB, and TRIPs Agreement has a PIL Nature and Always Prescribes the Application of the Lex Loci Protectionis A fourth opinion maintains that the territoriality principle does not pose any implicit exclusive jurisdiction rules and does not impede the courts seized from adopting PIL rules to determine the applicable law to the IPRs issue in question, but that it does determine a specific applicable law and therefore constitutes an implicit PIL rule for IPRs cases. This opinion refers to the territoriality principle as codified by the rules on the national treatment and on the most favourite nation183 of the CUP, CUB, and TRIPs agreements. According to this opinion, on the one hand the territoriality principle as codified by these rules mandates avoiding the adoption of connecting factors of a subjective nature, such as those based on nationality, to determine the applicable law to a concrete case: in fact, it is apparent that subjective connecting factors would indirectly discriminate among citizens of different States. On the other hand the territoriality principle would also prescribe the application of the lex loci protectionis: in fact, the adoption of a different connecting factor would constitute indirect discrimination, albeit of a less apparent nature than the discrimination following the connecting factor of nationality, and therefore, the territoriality principle mandates the application of the lex loci protectionis in relation to IPRs184. 180 Giovanni Maria Ubertazzi, ‘Osservazioni per uno studio intorno ai diritti sui beni immateriali nel diritto internazionale privato’ [1995] JUS 426. 181 Badiali (n 126 Chapter IV) 14. 182 Origoni della Croce (n 179 Chapter IV) 106-107. 183 On the most favourite nation and the national treatment principles in IPRs cases see supra, para 34. 184 Ulmer, ‘Intellectual Property Rights’ (n 20 Chapter I) 34; Jane Ginsburg, ‘Aspects de droit international privé de la protection d’oeuvres et d’objets de droit connexes transmis par réseaux numériques’ [1998] OMPI GCPIC/2 at 35, available at accessed 30 November 2011; Bouche (n 135 Chapter

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This opinion refers to the territoriality principle as codified by the national norms on IPRs which expressly limit their spatial scope to the enacting State, like inter alia Article 185 of the Italian copyrights statute which applies to every creation of Italian authors wherever published for the first time and also to creations of foreign authors domiciled in Italy which are published for the first time in Italy. This opinion highlights that these norms are national selflimited PIL provisions of a unilateral character that can be bilateralised by way of interpretation185. Yet, this opinion is not uniform in determining either the law concretely designated as applicable by the territoriality principle, or its objective scope. In fact, with regard to the applicable law, it refers to respectively the law of the State where the intellectual creation is firstly published186; the law of the State where the IPRs is exercised187; the law of the State where the IPRs shall be protected188. With respect to the scope of this applicable law, according to a first approach this law would apply to the IPRs’ existence, exercise and violation189; according to another view it would apply only to the IPRs’ existence and exercise190; and according to a final thesis the applicable law would regulate only the IPRs’ existence191. However, this opinion is unconvincing in so much as it interprets the territoriality principle as implicitly designating an applicable law. In fact, first, the national treatment principle is merely an expression of the condition of reciprocity in the treatment of aliens, which requires States to treat citizens and IV) 521; Luigi Carlo Ubertazzi, ‘voce Diritto d’autore, III, Diritto d’autore internazionale e comunitario’ (Vol. IV) Digesto delle discipline privatistiche. Sezione commerciale 452; Ubertazzi, ‘La territorialità’ (n 207 Chapter I) 99; Bernardo Cortese, Il trasferimento di tecnologia nel diritto internazionale privato (Padova, CEDAM 2000) 66; Carmen Otero GarcíaCastrillón, ‘Territorialidad y estado de origen en las denominaciones de origen, indicaciones geográficas y especialidades tradicionales garantizadas’ in Ubertazzi and Muñiz Espada (n 194 Chapter I) 65; Schaafsma (n 142 Chapter IV) para 1262, according to whom the national treatment principle “comprises two intricately linked rules: a conflict-of-law rule and an aliens-law rule: firstly, it provides (on the basis of the principle of formal territoriality generally applicable at the time) an applicable law in lieu of the former legal vacuum; and, secondly, it replaces the former discrimination with non-discrimination”. 185 Tullio Treves, ‘Il caso Zeiss’ [1967] RDIPP 437. See also the literature quoted in the immediately following footnotes. 186 Gergios Koumantos, ‘Sur le droit international privé du droit d’auteur’ [1979] Il diritto di autore 616. 187 Gian Carlo Venturini, Diritto internazionale privato. Diritti reali ed obbligazioni (Padova, CEDAM 1956) 67, 93 and 126. 188 Treves, ‘Il caso Zeiss’ (n 185 Chapter IV) 437; Origoni della Croce (n 179 Chapter IV) 111; Bouche (n 135 Chapter IV) 358 and 363; Auteri (n 207 Chapter I) 103. 189 Treves, ‘Il caso Zeiss’ (n 185 Chapter IV) 437; Origoni della Croce (n 179 Chapter IV) 111. 190 Tito Ballarino, ‘Banche dati, diritto internazionale privato e trattamento dello straniero’ (1997) VI AIDA 194. 191 Berge, La protection internationale (n 146 Chapter IV) 174.

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aliens alike not only with respect to substantive internal laws, but also with regard to PIL issues. Yet, “it is sure that the national treatment principle as it is formulated by the international Conventions [examined here] leaves unsettled the only important PIL question that counts in the matter, namely which law shall apply the national court when it is required to protect an IPR infringed in a country other than the forum”192. In other words, the territoriality principle can not be interpreted as a PIL rule since it does not determine any concrete applicable law, leaving its determination to the State’s PIL systems under the condition that their relevant PIL rules do not have a discriminating nature193. This approach is confirmed by the fact that the supporters of the opinion here criticised do not agree on which would be the applicable law allegedly determined by the territoriality principle understood as an implicit PIL rule. Also, the same approach is confirmed by the ECJ Tod’s decision, the US Itar-Tass judgment and the Japanese Coral Sand case which, as already mentioned194, interpret the territoriality principle as a substantive law principle that does not have anything to say with respect to applicable law issues: yet, as will be explained by the following remarks195 the territoriality principle might also have a PIL nature but does not invoke the exclusive application of the lex loci protectionis. Lastly, all the reasons invoked against the interpretation of the territoriality principle as posing an exclusive jurisdiction criterion can easily be extended, mutatis mutandis, to the interpretation of the territoriality principle as implicitly determining an applicable law. As for the self-limited provisions, their bilateralisation is generally technically impossible. In fact, for instance, with regard to Article 185 of the Italian copyright statute the bilateralisation of the first paragraph (according to which “this statute applies to every creation of Italian authors wherever published for the first time”) is inconsistent with the bilateralisation of the second paragraph (according to which the same statute “applies also to creations of foreign authors domiciled in Italy which are published for the first time in Italy”)196. Finally, with respect to the non-uniformity in determining the applicable law allegedly designed by the territoriality principle and the concrete scope of 192

Fentiman (n 146 Chapter IV) 133; Berge, La protection internationale (n 146 Chapter IV) 204; Berge, ‘Droit d’auteur’ (n 146 Chapter IV) 366; Patry (n 41 Chapter I) 413; Pertegás Sender, Cross-Border (n 130 Chapter IV) 233; Pertegás Sender, ‘Intellectual Property’ (n 146 Chapter IV) 227; van Eechoud (n 146 Chapter IV) 107; Boschiero, ‘Il principio’ (n 207 Chapter 1) 45. 193 See the above sources. See also Moura Vicente (n 209 Chapter 1) 271; Basedow, ‘Foundations of Private International Law’ (n 148 Chapter 1) 9-10. 194 See supra, para 52. 195 See infra, paras 59-65. 196 Badiali (n 126 Chapter IV) 20 and footnote 23 with respect to other similar rules of countries other than Italy.

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that law, it is to be noted that the connecting factors allegedly implicitly posed by the territoriality principle are criticisable. Thus, the first publication of the creation is a fortuitous connecting factor, difficult to trace over years, that is irrelevant (the relevant point is the creation and not the publication) and anyway inapplicable to registered IPRs197. The connecting factor of the State where the IPR has been exercised does not take into account that the exercise of a right is a consequence of its juridical protection198. Moreover, the connecting factor of the State of protection can designate as the lex causae the law of a State that does not want to protect the right199 and is “ambiguous”200. This is demonstrated also by Article 5(2) CUB201, since it is able to determine at the same time the law of the State of the forum as the country to which the protection of the IPR is required, or the law of the State for which its IPR protection is required202. Finally, the connecting factor of the State for which the protection is required is highly criticised with respect to the ubiquitous infringement of IPRs203. 56. The Territoriality Principle in other Relevant Norms Expressly Shaped as PIL Rules With respect to the territoriality principle posed by rules which are other than the norms of the CUP, CUB, and TRIPs agreement just examined, and which are expressly formulated as PIL norms, it is necessary to refer to the norms that adopt connecting factors or jurisdiction criteria (Schutzlandanknüpfungen) linking the concrete case to the State that granted the IPR involved (Schutzland). As far as international jurisdiction rules are concerned, a first group of provisions are, for instance in Europe, the ones that pose exclusive jurisdiction rules, namely those that constitute the object of this book. A second group of provisions are those on IPRs infringements, such as Article 5(3) of the Brussels I Regulation, that are interpreted on the basis of the territoriality principle, reaching the conclusion that an infringement of an IPR can occur only where the right exists, and that therefore the place of the action coincides with the place of the result204. A third group of provisions limit the 197

Ibid 18. Origoni della Croce (n 179 Chapter IV) 113. 199 Badiali (n 126 Chapter IV) 23. 200 Ibid. 201 See supra, para 52. 202 Boschiero, ‘Il principio’ (n 207 Chapter I) 41; Moura Vicente (n 209 Chapter I) 271. 203 On ubiquitous infringements see Annette Kur, ‘Principles Governing Jurisdiction, Choice of Law and Judgments in Transnational Disputes: A European Perspective’ (2003) 65(3) Computer Law Review International 70; Heinze, ‘A Framework for International Enforcement’ (n 210 Chapter I) 62. See also infra, para 63. 204 See also de Miguel Asensio, ‘Cross-border’ (n 6 Chapter I) 123; Boschiero, ‘Il principio’ (n 207 Chapter I) 80; Moura Vicente (n 209 Chapter I) 390; Haimo Schack, Internation198

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coordination of proceedings by reason of the territoriality principle, such as Article 6(1) of the Brussels I Regulation as interpreted by the ECJ in the Roche case205. As far as the choice of law provisions are concerned, a first group of rules are those that, for instance in Europe, determine as the applicable law the lex loci protectionis206, such as Article 54 of the Italian PIL statute, Article 110 of the Swiss PIL Statute, Article 93 of the Belgian PIL Act, Article 10 of the Spanish Civil Code as bilateralized by the Jurisprudence, and Article 8 of the Rome II Regulation. Particularly, according to Article 8 of the Rome II Regulation “the law applicable to a non-contractual obligation arising from an infringement of an intellectual property right shall be the law of the country for which protection is claimed”207. A second group of rules determines as the ales Zivilverfahrensrecht (2nd edn, Beck 2010) 122. For a critic see Yokomizo, ‘Intellectual Property Infringement’ (n 149 Chapter IV) 105. The territorial approach with regard to IPRs infringements is adopted also by the CLIP Principles (n 59 Chapter I) infringement jurisdiction rules, on which see infra, para 62. See also the comments of Christian Heinze reported in Paulius Jurys, Yuko Nishitani and Simon Vande Walle, ‘Summary of Comments and Discussion on International Jurisdiction’ in Basedow, Kono and Metzger (n 2 Chapter I) 151. See also the opinion of Professor Nishitani reported in Jurys, Nishitani and Vande Walle (ibid) 149. The territorial approach proper of the CLIP Principles (n 59 Chapter I) is not adopted by the other four sets of corresponding Principles, on which see later in the text. 205 Roche v Primus (n 120 Chapter II) para 5, p. 41. On the Roche case see Annette Kur, ‘A Farewell’ (n 32 Chapter I) 844; González Beilfuss (n 32 Chapter I) 275; Conflict of Laws in Intellectual Property, ‘Exclusive Jurisdiction and Cross Border IP (Patent) Infringement. Suggestions for Amendment of the Brussels I Regulation’ available at accessed 30 November 2011; Lundstedt (n 32 Chapter I) 123; Norrgård (n 32 Chapter I) 217; Fumagalli, ‘Litigating Intellectual Property’ (n 32 Chapter I) 15; Kur and Ubertazzi (n 32 Chapter I) 89; Fawcett and Torremans (n 51 Chapter I) 177. 206 See the references in Nerina Boschiero, ‘Infringement of Intellectual Property Rights. Comment on Article 8 of the Rome II Regulation’ (2007) 9 Y.B. Priv. Int’l L. 87; Metzger, ‘Applicable Law Under The CLIP-Principles’ (n 2 Chapter I) 171. 207 See the Rome II Regulation (n 151 Chapter I) and supra, para 5. On Article 8 of the Regulation see Pertegás Sender, ‘Intellectual Property’ (n 146 Chapter IV) 238; Boschiero, ‘Infringement of Intellectual Property Rights’ (n 206 Chapter IV) 87; Stefania Bariatti, ‘The Law Applicable to the Infringement of IP Rights under the Rome II Regulation’ in Bariatti, Litigating Intellectual Property Rights (n 31 Chapter I) 63. (i) Particularly, according to a first thesis the law determined by Article 8 of the Regulation encompasses the IPRs’ existence, scope, validity, ownership, transferability and infringement issues (therefore, this opinion excludes any possible application of a different law, like for instance the lex originis, apart from the cases explicitly provided for by the international conventions, Jürgen Basedow and Axel Metzger, ‘Lex loci protectionis europea’ in Festschrift für Mark Moiseevi Boguslavski (Berlin, BWV 2004) 162. (ii) In contrast, according to a second thesis Article 8 of the Rome II Regulation does not address IPRs first ownership or transferability issues, which are therefore regulated by the national conflict of law rules of the forum State. This conclusion is grounded on two different reasons. Firstly, Article 15 of the Rome II Regulation does not expressly include the first ownership or transferability issues in those falling within the scope of the lex

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applicable law the lex loci commissi delicti, and due to the territoriality principle is generally interpreted as designating the law of the country for which IPRs protection is required: namely Article 34 of the Austrian PIL Act, Article 38 of the Liechtenstein PIL Act, Article 3(1) of the Dutch PIL Statute on torts and the Portuguese relevant PIL rule for IPRs infringements208. As a matter of fact the territoriality principle on which the aforementioned PIL rules are based is interpreted in different ways. 57. Non-acceptability of the Opinion that the Territoriality Principle in Rules other than the CUP, CUB, and TRIPs Agreement does not Impose the Application of a Foreign Law According to a first opinion, the territoriality principle does not impose the application of a foreign law, and therefore is not of a PIL character. In fact, notwithstanding their appearance, PIL rules referring to the lex loci protectionis cannot lead to an understanding that a foreign law could apply to an IPR in the forum as such since that which concerns the IPRs existence, scope and revocation could only be read as choice of law provisions in a negative sense, namely determining that the only IPRs considered as existent in the forum are the ones which have been established according to the forum’s substantive law. In contrast, the PIL rules that refer to the lex loci protectionis have a useful effect where they deal with IPRs infringements issues, since in this case they shall be intended as bilateral choice of law provisions that are better placed to regulate infringement issues than PIL rules on civil liability in general209. However, this opinion is unconvincing because it is contrary to the literal interpretation of PIL rules referring to the lex loci protectionis, which are formulated as positive bilateral choice of law rules, and therefore as rules that can designate a foreign law as the one applicable in the forum State. Also, the useful effect that PIL rules determining the lex loci protectionis as the applicable law would have with respect only to IPRs infringements issues, since in this case they shall be intended as bilateral choice of law provisions which would better regulate the infringement matters than the PIL rules on civil liability in general, seems inconsistent with the decisive reasons given against the interpretation of these same PIL rules as bilateral choice of law provicausae (Pertegás Sender, ‘Intellectual Property’ (n 146 Chapter IV) 238; Nadine Klass, ‘Das Urheberkollisionsrecht der ersten Inhaberschaft – Plädoyer für einen universalen Ansatz’ [2007] GRUR Int 374 footnote 22, referring to Josef Drexl). Secondly, States designate different laws to address the first ownership and transferability issues. In fact, certain national PIL systems render applicable the lex loci protectionis, whereas others, the lex originis. 208 See the references in Boschiero, ‘Infringement of Intellectual Property Rights’ (n 206 Chapter IV) 87; Metzger, ‘Applicable Law Under The CLIP-Principles’ (n 2 Chapter I) 171. 209 Luzzatto, ‘Proprietà intellettuale’ (n 126 Chapter IV) 901.

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sions with regard to all other issues such as the IPRs existence, scope and extinction210. Finally, according to the thesis here criticized the PIL rules designating the lex loci protectionis would have, at the same time, a negative PIL nature (where dealing with the issues related to the IPRs existence and validity) and a bilateral conflict of laws nature (where addressing the IPRs infringement matters): yet, these PIL rules adopt a single connecting factor (referring to the lex loci protectionis), which cannot be interpreted as an expression of two different PIL methods. 58. Non-acceptability of the Opinion that the Territoriality Principle in Rules other than the CUP, CUB, and TRIPs Agreement has only a Substantive Nature According to a second opinion a distinction is to be made between international jurisdiction rules and conflict of laws provisions. As for the international jurisdiction norms, the territoriality principle at their basis can “have an impact”211 on these rules, but does not pose exclusive jurisdiction rules212. This conclusion is, then, in line with the ECJ Tod’s decision as well as with the interpretation of exclusive jurisdiction posed by Article 16(4) of the Brussels Convention (now Article 22(4) of the Brussels I Regulation): according to the ECJ this Article is a consequence of the Act of State doctrine rather than of the territoriality principle213. As for the conflict of laws provisions, however, the territoriality principle would not determine the application of a foreign law and therefore would not have a PIL character. In fact, the territoriality principle would only have a substantive nature214. Then, the PIL rules mentioned above, as they relate to the territoriality principle, would be based only on political grounds rather than on legal reasons215. However, whereas this opinion fully convinces with regard to the understanding of the territoriality principle in respect of international jurisdiction rules, it does not seem to be as convincing in relation to the same principle’s interpretation as a substantive law principle unable to dispose also of a PIL nature, as will be explained in the following paragraphs of this chapter216.

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Boschiero, ‘Il principio’ (n 207 Chapter I) 48. Peukert (n 72 Chapter IV) para I. 212 De Miguel Asensio, ‘Cross-border’ (n 6 Chapter I) 117 footnote 12. 213 See supra, para 8. 214 Drexl, ‘Internationales Immateralgüterrecht’ (n 124 Chapter IV) 821. 215 Ibid. 216 See also Boschiero, ‘Il principio’ (n 207 Chapter I) 37. 211

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IV. Thesis Here Purported: the Territoriality Principle as an Expression of the Proximity Principle IV. Thesis Here Purported 59. Opinions Emphasizing the Connection between the Territoriality Principle and Proximity Reasons in IPRs Cases The thesis proposed in this book advocates a new interpretation of the territoriality principle. Specifically, territoriality is understood as an expression of the proximity principle, which aims to determine the court(s) and law(s) more proximal to each individual case, and which was theorised by Lagarde in his general private international law course that he taught at The Hague Academy in 1986217. This thesis therefore purports that the territoriality principle so interpreted not only has both a substantive nature and an impact on the PIL rules designating the lex loci protectionis, but also is a principle that determines which court has international jurisdiction as well as which law is the applicable law for the cases concerned and therefore has a PIL nature. Yet, the territoriality principle, even though intended as also having a PIL nature, not only does not demand that an IPR be only protected in the courts of the country for which the right is granted, but also impedes the adoption of rules according to which IPRs shall be protected only by a single court or by a single law, namely the ones of the country for which protection is required. In other words, the territoriality principle, when intended as an expression of the proximity principle, is contrary to any PIL rules that pose exclusive jurisdiction or that determine an exclusive applicable law.

217 Paul Lagarde, ‘Le principe de proximité dans le droit international privé contemporain’ (1986) I 196 Recueil des Cours 29. The author recognises that the proximity principle has a different influence on the conflict of laws provision to that on the international jurisdiction rules. However, for the scope of this book the fact that this influence is different is not relevant, so far as the exclusive jurisdiction rules are concerned. On Lagarde’s course with particular regard to the application of the proximity principle to the conflict of laws field, see also Tito Ballarino and Gian Paolo Romano, ‘Le principe de proximité chez Paul Lagarde’ in Mélanges en l’honneur de Paul Lagarde (Paris, Dalloz-Sirey 2005) 37. On Lagarde’s course with regard to international jurisdiction issues see Etienne Pataut, Principe de souveraineté et conflits de juridictions Étude de droit international privé, préface par Paul Lagarde (Paris, LGDJ 1999); Arnaud Nuyts, L’exception de forum non conveniens Etude de Droit International Privé Comparé (Bruxelles-Paris, Emile Bruylant 2003) 463 and 520. On Lagarde’s course with regard to both international jurisdiction and conflict of laws see Demetra KokkiniIatridou, Les clauses d’exception en matière de conflits de lois et de conflits de juridictions – ou le principe de proximité (Martinus Nijhoff 1994); Catherine Kessedjian, ‘Le principe de proximité vingt ans après’ in Mélanges en l’honneur de Paul Lagarde (n 217 Chapter IV) 507. Of note, this last author criticises the proximity principle as not being able to influence the international jurisdiction rules related to complex issues, such as multi-state human rights civil claims.

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Before examining the thesis here purported, it is relevant to remember that the connection between the territoriality principle and the proximity principle is supported in the work of other scholars. For example, in 1973 Auteri maintained that the reasons at the basis of the territoriality principle in intellectual property law are partially coincidental with the ones that ground the locus commissi delicti connecting factor218, namely the need to recognise the competence of the legal order that is more strictly connected219, and thus more proximal, to the subjects involved. According to Auteri, the State that grants an IPR is the one more strictly connected to IPRs cases. In fact, besides being best placed to interpret the interests of the subjects that act in the market where the trademark is used, that State is also easily accessible by the subjects who operate in that market occasionally220. More recently, other scholars have linked the territoriality principle to proximity reasons, among whom are also the members of the CLIP group. The majority of these scholars came to the conclusion that the State more strictly connected to a case relating to an IPR validity issue principally raised is the one that granted this IPR. Therefore the exclusive jurisdiction rules in favour of this State are to be welcomed. In contrast, this State is not necessarily the State more strictly connected to an IPRs case involving a claim of infringement or a validity issue raised as a defence or a plea in objection. Therefore the exclusive jurisdiction rules in favour of this State are not to be welcomed221. Moreover, the ECJ in the GAT case222 maintained that “the rules of exclusive jurisdiction” laid down in Article 16(4) of the Brussels Convention, now Article 22(4) of the Brussels I Regulation223, “seek to ensure that jurisdiction [in intellectual property matters] rests with courts closely linked to the pro-

218

Auteri (n 207 Chapter I) 100. Ibid 116. 220 Ibid 100. 221 See Pertegás Sender, Cross-Border (n 130 Chapter IV) 19 ad 22, who invokes “the principle of proximity” in IPR cases and interprets it as determining the territorial State as the country most connected to IPRs. The same conclusion is reached by González Beilfuss (n 32 Chapter I) 275. See also Heinze, ‘A Framework for International Enforcement’ (n 210 Chapter I) 65-66 with reference to the infringement jurisdiction, on which see para 62, and Neumann Sophie, ‘Intellectual Property Rights Infringements in European Private International Law: Meeting the Requirements of Territoriality and Private International Law’ (2011) 7 Journal of Private International Law 583. In critical terms with respect to exclusive jurisdiction rules in general, see Fernández Arroyo, ‘Compétence exclusive’ (n 45 Chapter I) 37, who demonstrates that the international jurisdiction criteria, which vest exclusive jurisdiction, are based on two different principles, namely the competition between fora and what is considered to be their “reasonable character”, that is expression of the “proximity” principle. 222 See supra, paras 1 and 8. 223 Brussels I Regulation (n 84 Chapter I). 219

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ceedings in fact and law”224. Thus the ECJ justified the exclusive jurisdiction rule on the basis of proximity reasons. However, the ECJ reached conclusions that contradict the thesis proposed here. In fact, owing also to the proximity principle, the ECJ maintained that the rules concerning exclusive jurisdiction shall encompass also the IPRs validity claims raised incidentally or as a plea in objection225. In sum, on the one hand, these opinions have the merit of connecting the territoriality principle to proximity reasons. On the other hand, these opinions do not apply the entire thesis proposed by Lagarde on the proximity principle and its conclusions. Therefore, these opinions reach results that are different from one another and also with respect to the conclusions proposed here. 60. Lagarde’s Thesis on the Proximity Principle In this context it is necessary to recall briefly the historical framework under which the thesis on the proximity principle was proposed by Lagarde226. First, scholars during the Middle Ages, such as Bartolo da Sassoferrato227, Baldo228, Dumoulin229 and D’Argentré230, adopted a PIL method, the so-called statutory method, according to which cases that contained connections to other States or cities were adjudicated initially by: determining the scope of the relevant national statute or substantive law; then by determining whether the case in question was indeed covered by the scope of that statute or substantive law; and finally, conditioned upon the affirmation of the previous determination by exercising jurisdiction according to the forum law231. Subsequently, Von Savigny theorised a PIL method that “does not concern itself with demarcating the scope of a country’s own law, as was the doctrine 224

GAT v LuK (n 32 Chapter I) 21. See also Advocate General Geelhoed, opinion on the GAT v LuK case delivered on 16 September 2004, at para 19: “the courts of the Member State in which the patent is granted are best placed to adjudicate upon its validity, because of their physical proximity and also because they are legally most closely connected with the granting of the patent”. 225 See supra, paras 1 and 8. 226 See the references in Lagarde, ‘Le principe de proximité’ (n 217 Chapter IV) 29. 227 See Rodolfo De Nova, ‘Historical and Comparative Introduction to Conflict of Laws’ (1966) II 118 Recueil des Cours 445. 228 See Antoine Pillet, Traité pratique de droit international privé (Paris, Tenin 1923) 490. 229 Jean Louis Thireau, Charles Du Mulin: 1500–1566: étude sur les sources, la méthode, les idées politiques et économiques d’un juriste de la Renaissance (Geneva, Droz 1980). 230 See Bertrand d’Argentré, ‘Sub art.218 della coutume della Bretagna’ in Commentarii in consuetudines Ducatus Britannae. Aliquiique tractatus varii (Sumptibus Nicolai Buon, Cum privilegio Regis M.D.C.XIII, Paris, 1539). On d’Argentré see Jean Barbey, ‘La sort du système de d’Argentré’ [1940-41] Revue historique de droit français et étranger 397–411. 231 See the literature just referred to at the previous four footnotes. See also Schaafsma (n 142 Chapter IV) para 1262.

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of statutes, but with tracing the (territory of the) law to which the legal relationship belongs according to its nature (‘seiner eigenthümlichen Natur nach angehört oder unterwurfen ist (worin dasselbe seinen Sitz hat)’)”232. Thus the Savigny’s method was based on the abstract localisation of an individual case233. According to Savigny’s system cases were to be adjudicated firstly by analysing their constitutive elements (in contrast to the statutory method the scope of the national statutes that could apply to the cases in question were not examined). This particular analysis served to partition the relevant cases into categories of PIL rules established ex ante in order to determine the State most closely connected to cases of the same nature as those to be adjudicated. After the partition of individual cases into the categories of PIL rules, Savigny’s method determined the competent court and the applicable law for the individual case by using the PIL rules associated with the category that corresponded to that case’s location. The 1950s American conflicts revolution criticised Savigny’s method for insufficiently taking into account the individual facts and elements of each case234. Thus, according to the American conflict of laws revolution, the determination of the State most closely connected to an individual case should be based on the facts of individual cases rather than on its inclusion within a predetermined category of a PIL norm. However, this determination should take place only at the time when the case needed to be addressed, and therefore ex post. 232

Schaafsma (n 142 Chapter IV) para 1264. Friedrich Carl von Savigny, Sistema del diritto romano attuale (translation by Vittoria Scialoja) (VIII, Torino, Unione Tipografico-Editrice 1898). On Savigny and on the influence of the method he theorized on European and US private international law see the following: Paul Neuhaus, ‘Savigny und die Rechtsfindung aus der Natur der Sache’ [1949-1950] RabelsZ 364–381, who speaks of a “copernican” turning point in private international law; Franca De Marini, ‘La politica del diritto di Savigny’ [1979] Pol. Dir. 423-440; Michael Hoeflich, ‘Savigny and his Anglo American Disciplines’ [1989] Am. J. Comp. L. 17–37; Gerhard Kegel, ‘Wohnsitz und Belegenheit bei Story und Savigny’ [1988] RabelsZ 431–465; Gerhard Kegel, ‘Story and Savigny’ [1989] Am. J. Comp. L. 39–66; Stefan Riesenfeld, ‘The Influence of German Legal Theory on American Law: the Heritage of Savigny and his Disciplines’ [1989] Am. J. Comp. L. 1–37; Daniel Zimmer, ‘Savigny und das Internationale Privatrecht unserer Zeit’ in Mélanges Fritz Sturm (Liege 1999) 1709–1722; Pierre Gothot, ‘Simples réflexions à propos de la saga du conflit des lois’ in Mélanges en l’honneur de Paul Lagarde (n 217 Chapter IV) 349. 234 Kessedjian (n 217 Chapter IV) 509; Erik Jayme, ‘The American Conflicts Revolution and Its Impact on European Private International Law’ in Forty Years On: The Evolution of Postwar Private International Law in Europe (Wolters Kluwer 1990) 22; Symeon Symeonides, ‘The American Revolution and the European Evolution in Choice of Law: Reciprocal Lessons’ (2008) 82(5) Tul. L. Rev. 4, electronic copy available at accessed 30 November 2011; Ralf Michaels, ‘The New European Choice-of-Law Revolution’ (2008) 82 Tul. L. Rev. 1610. 233

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Finally, subsequent European scholars criticised the American conflict of laws revolution as unpredictable and as not sufficiently taking into account the need for juridical certainty235. Therefore, according to these scholars the law of the State most closely connected to an individual case was to be determined in two steps. First, by determining ex ante the State most closely connected to it, according to the Savigny method. Secondly, by verifying whether the individual case was in fact most closely connected to a country different from the one determined through the Savigny method, and thereby designating the courts and laws of the most closely connected country as those competent to address the case at issue. In this context, the proximity principle proposed by Lagarde follows this last thesis236. Thus, PIL rules based on the proximity principle localise the relevant cases ex ante according to Savigny’s method, but designate more than one applicable law or competent court, among which can be chosen the one court and law that is best placed to address the case according to its individual constitutive elements. Not every PIL provision is based on the proximity principle. Certain conflict of laws or international procedural rules are based on Lagarde’s so-called competing principles, among which, and of particular interest here, is the sovereignty principle237. The sovereignty principle bases the PIL rules relating to legal institutions (for example, marriage and divorce), that, at least initially, are recognised and created by a State, on the exercise of its sovereign powers. On the one hand, those PIL rules vest jurisdiction in the courts of this same State, adopting jurisdiction criteria of a territorial or a personal nature that correspond to the same means with which the State indicates its subjective power, and are based on the sovereignty principle. On the other hand, the same rules based on the sovereignty principle also adopt connecting factors of a territorial or a personal nature, which have first a unilateral character, and which are then subsequently bilateralised238. With time, the States’ sovereignty powers over these legal institutions can diminish and a corresponding increase of their private relevance can occur. Then, at the PIL level, a “défaillance du facteur de rattachement”239, or failure of the connecting factor, of a territorial or personal nature, occurs, and a pressing need arises to substitute it with a connecting factor or a jurisdiction criterion based on the

235

Vitta Edoardo, ‘Impact in Europe of the American Conflicts Revolution’ (1982) 30(1) Am. J. Comp. L. 1. 236 Lagarde, ‘Le principe de proximité’ (n 217 Chapter IV) 25. 237 Ibid 49. See also Pataut (n 217 Chapter IV). 238 “Cette bilatéralisation des règles de conflit fondées sur l’idée de souveraineté ne résulte pas de la nature des choses. Elle résulte d’une concession de l’Etat du for, elle-même fondée sur l’idée de réciprocité” as per Lagarde, ‘Le principe de proximité’ (n 217 Chapter IV) 5152. 239 Ibid 72.

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proximity principle240. As a consequence, the conflict of laws or international procedural rules adopting connecting factors or jurisdiction criteria based on the sovereignty principle are substituted by other criteria based on the proximity principle, or remain formally the same but start to be interpreted as though based on the proximity principle. Where this occurs the proximity principle penetrates more or less surreptitiously241 the PIL rules adopting the sovereignty principle. Consequently, the PIL rules that are based firstly on sovereignty reasons but then which are ultimately conquered by the proximity principle, explicitly or implicitly (by way of interpretation) determine more than one competent court or laws242. As an example of the application of the proximity principle, Lagarde refers to the personal status of individuals, including the individuals’ capacity (not relating to business), name, personal identity and parental/spouses relationships243. Originally (and also still presently in certain confessional States244) these legal institutions were strictly related to the sovereignty powers of their granting/recognising States. Thus, the courts competent to address these institutions were the courts of the State of the nationality or of the domicile/residence of the individual concerned. At that time, the conflict of laws provisions relating to personal status were unilateral PIL rules that limited their scope by adopting the nationality or respectively the domicile connecting factors, and that were subsequently bilateralised. Thus, the criteria of PIL rules mentioned above constituted the same means with which the State indicated its subjective power, and were based on the sovereignty principle. Yet, thereafter, personal status began to be intended as no longer strictly related to the sovereignty of States that were recognising it, but rather as having a human rights and a private relevance. Thus, on the PIL field the jurisdiction criteria and the connecting factors based on the nationality or on the domicile of the persons involved started to be perceived as inadequate to determine their personal status. In fact, in many cases these connecting factors or jurisdiction 240

“Une pression très forte s’exerce pour substituer au fondement d’allégeance un rattachement fondé sur le principe de proximité” (ibid) 95. 241 “Pénètre plus o moins subrepticement” (ibid). 242 Pataut (n 217 Chapter IV) para 665, according to whom “lorsque les considérations de localisation, de proximité, devenaient majoritaires, la solution de la compétence exclusive devait être évité” (“whenever the instances of localisation, of proximity, prevail, the solution of the exclusive jurisdiction rules shall be avoided”). According to Pataut, in order to compensate the overcoming of the exclusive jurisdiction rules in favour of the forum State the competency to verify the law applied by the foreign court, whose judgment the forum State court shall recognise and enforce, shall be established. Namely, the forum State court shall have the competency to verify that the foreign court applied the forum State law in adjudicating issues relevant to the national interests of the forum State. See also paras 442 and 443. 243 Lagarde, ‘Le principe de proximité’ (n 217 Chapter IV) 66. 244 Ubertazzi, La capacità delle persone fisiche (n 173 Chapter IV) 66.

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criteria could not determine a single competent court or applicable law where the person involved did not have a nationality or a domicile, or where he/she had more than one. As a consequence, the nationality and domicile connecting factors were strongly criticised for their inability to address transnational cases, and a défaillance du facteur de rattachement arose, with a consequent pressure to substitute them with connecting factors or jurisdiction criteria that could determine a better law or forum to address the IPRs cases. This pressure originated in different rules deviating from the nationality and domicile connecting factors, adopting instead the habitual residence criterion or rules combining the nationality, domicile and residence factors245. Where this occurred the proximity principle conquered the PIL rules, which were based on the sovereignty principle246. So, for instance, initially in matters relating to divorce the PIL rules based on the sovereignty principle vested jurisdiction in the courts of the nationality or of the domicile of both spouses. Nowadays, Article 3 of Council Regulation (EC) No 2201/2003 of 27 November 2003 concerning jurisdiction and the recognition and enforcement of judgments in matrimonial matters and the matters of parental responsibility247, on “general jurisdiction”, is based on the proximity principle and establishes many jurisdiction criteria248. 61. Extension to IPRs of Lagarde’s Thesis on the Proximity Principle The following remarks concern the application of Lagarde’s proximity principle to the territoriality principle that characterises IPRs. Initially IPRs were intended as strictly relating to the sovereign powers of their granting State. Thus, international jurisdiction was vested in the courts of this granting State. 245

See the references in Lagarde, ‘Le principe de proximité’ (n 217 Chapter IV) 66. Ibid. 247 Council Regulation (EC) 2201/2003 of 27 November 2003 concerning jurisdiction and the recognition and enforcement of judgments in matrimonial matters and the matters of parental responsibility [2003] OJ L338/1, repealing Council Regulation (EC) 1347/2000 of 29 May 2000 on jurisdiction and the recognition and enforcement of judgments in matrimonial matters and in matters of parental responsibility for children of both spouses [2000] OJ L160/19. 248 According to Article 3 of the Regulation “1. In matters relating to divorce, legal separation or marriage annulment, jurisdiction shall lie with the courts of the Member State /(a) in whose territory: / - the spouses are habitually resident, or / - the spouses were last habitually resident, insofar as one of them still resides there, or / - the respondent is habitually resident, or / - in the event of a joint application, either of the spouses is habitually resident, or / - the applicant is habitually resident if he or she resided there for at least a year immediately before the application was made, or / - the applicant is habitually resident if he or she resided there for at least six months immediately before the application was made and is either a national of the Member State in question or, in the case of the United Kingdom and Ireland, has his or her "domicile" there; / (b) of the nationality of both spouses or, in the case of the United Kingdom and Ireland, of the "domicile" of both spouses”. 246

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Furthermore, the applicable law was determined by self-limited unilateral rules which were to be applied to any IPRs granted in the territorial Sate. Therefore, the territoriality principle adopted by those rules was a jurisdiction criterion and a connecting factor that corresponded to the same means by which the State indicated its subject power, and was based on the sovereignty principle. Later in time, the territoriality principle was recognised by international conventions relating to IPRs, such as the CUP, the CUB, and the TRIPs agreement249. By recognising the territoriality principle as a connecting factor of the national unilateral norms mentioned above, the CUP, CUB, and TRIPs agreements bilateralised this same principle. Since the territoriality principle was a connecting factor in the aforementioned unilateral norms and thus had a PIL nature, the territoriality principle retained its PIL nature when it was bilateralised by the CUP, CUB and TRIPs agreements. After the recognition of the territoriality principle in those international conventions, the principle was adopted as the basis of the currently existing provisions expressly formulated as PIL rules. Among these provisions is Article 5(3) of the EU Brussels I Regulation, which was and still is by just one view250 interpreted on the basis of the territoriality principle, reaching the conclusion that an infringement of an IPR can occur only where the right is granted filed or comes into existence, and that therefore the State of the IPR infringing action coincides with the State of the result of the IPR infringement and is the territorial State251. Also among these provisions is Article 8 of the EU Rome II Regulation252. The perception of IPRs subsequently changed: they were generally no longer seen as linked to the State’s sovereignty, but rather as private rights. As a consequence, the territoriality principle was strongly criticised for its inability to address transnational cases in a globalised world253, and a défaillance du facteur de rattachement constituted by the territoriality principle occurred. Following this, there was a widespread call to substitute the territoriality principle with connecting factors or jurisdiction criteria that could determine a

249

See supra, paras 1 and 5. See the following para. 251 For criticism see Yokomizo, ‘Intellectual Property Infringement’ (n 149 Chapter IV) 105. See also the following para. 252 See supra, para 56. 253 See Straus (n 207 Chapter I) 135; Bradley (n 207 Chapter I) 505; Dinwoodie, ‘Commitments to Territoriality’ (n 207 Chapter I); Leong and Saw (n 207 Chapter I) 38; Boschiero, ‘Il principio’ (n 207 Chapter I) 34; de Miguel Asensio, ‘Cross-border’ (n 6 Chapter I) 105; Dinwoodie, ‘Developing a Private International’ (n 28 Chapter IV) 711. See also supra, para 1. 250

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better law or forum to address IPRs cases254. As a result, certain sets of rules deviating from the territoriality principle started to emerge. Through the enactment of the aforementioned provisions, deviating from the territoriality principle, the proximity principle conquered the PIL rules that were once based on the territoriality principle. Before analysing the consequence of this, the following remarks will examine the rules deviating from the territoriality principle. 62. First Group of PIL Provisions Deviating from the Territoriality Principle: Rules that Adopt Jurisdiction Criteria which are not Based on the Territoriality Principle A first group of PIL provisions deviating from the territoriality principle encompasses the norms that adopt jurisdiction criteria which are not based on the territoriality principle. Among these rules are those that vest jurisdiction in the courts of the defendant’s domicile or residence, such as inter alia Article 2 of the Brussels I Regulation255. Rules such as Article 2 confer jurisdiction in relation to registered or unregistered IPRs infringement claims, or to unregistered IPRs validity claims principally or incidentally raised, or to registered or unregistered IPRs transfer claims in the courts of the State where the defendant is domiciled. Thus, these rules do not establish any additional requirement, as they do not impose the consideration of whether the IPR in question exists in the forum State, or was infringed in the forum State. Therefore, these rules reflect an approach that overcomes a strict territorial approach with respect to IPRs. Also, a tendency to overcome a strict territorial approach is reflected by the rules on jurisdiction that do not consider the place of result at the place of the act in the name of the territoriality principle, but rather extend to IPRs the ubiquity theory, which is generally adopted with respect to other sorts of torts and leads to the vesting of international jurisdiction in the courts at the place of the act or alternatively in the courts at the place of the result. In the Brussels system for instance, Article 5(3) of the Brussels I Regulation establishes that “a person domiciled in a Member State may, in another Member State, be sued: / […] 3. in matters relating to tort, delict or quasi-delict, in the courts for the place where the harmful event occurred or may occur”. In relation to this rule and to its corresponding one of the Brussels Convention the ECJ has rendered many different interpretative judgments. So, in the Mines de potasse case the ECJ posed the ubiquity theory by maintaining that “where the place 254

See previous footnote. See de Miguel Asensio, ‘Cross-border’ (n 6 Chapter I) 119; Boschiero, ‘Il principio’ (n 207 Chapter I) 75 and there for further references; Fawcett and Torremans (n 51 Chapter I) 143; Luginbuehl (n 109 Chapter I) 43. 255

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of the happening of the event which may give rise to liability in tort, delict or quasidelict and the place where that event results in damage are not identical the expression ‘place where the harmful event occurred’, in Article 5(3) of the Convention of 27 September 1968 on jurisdiction and the enforcement of judgments in civil and commercial matters, must be understood as being intended to cover both the place where the damage occurred and the place of the event giving rise to it. The result is that the defendant may be sued, at the option of the plaintiff, either in the courts for the place where the damage occurred or in the courts for the place of the event which gives rise to and is at the origin of that damage”256. With particular regard to the multi-state infringements, in the Shevill decision257 the ECJ allowed the consolidation of infringement proceedings maintaining that the expression of Article 5(3) of the Brussels I Regulation “place where the harmful event occurred” shall be interpreted in the sense that “the victim of a libel by a newspaper article distributed in several Contracting States may bring an action for damages against the publisher either before the courts of the Contracting State of the place where the publisher of the defamatory publication is established, which have jurisdiction to award damages for all the harm caused by the defamation, or before the courts of each Contracting State in which the publication was distributed and where the victim claims to have suffered injury to his reputation, which have jurisdiction to rule solely in respect of the harm caused in the State of the court seised”. In the very recent eDate case the ECJ maintained that Article 5(3) of the Brussels I Regulation “must be interpreted as meaning that, in the event of an alleged infringement of personality rights by means of content placed online on an internet website, the person who considers that his rights have been infringed has the option of bringing an action for liability, in respect of all the damage caused, either before the courts of the Member State in which the publisher of that content is established or before the courts of the Member State in which the centre of his interests is based. That person may also, instead of an action for liability in respect of all the damage caused, bring his action before the courts of each Member State in the territory of which content placed online is or has been accessible. Those courts have jurisdiction only in respect of the damage caused in the territory of the Member State of the court seised”258. In sum, for torts in general Article 5(3) of the Brussels system as interpreted by the ECJ does not consider the place of result 256

Case C-21/76 Handelskwekerij G. J. Bier BV v Mines de potasse d'Alsace SA [1976] ECR 1735, conclusions. 257 Case C-68/93 Shevill v Presse Alliance SA [1995] ECR I-415. On the Shevill decision see for all Anna Gardella, ‘Diffamazione a mezzo stampa e Convenzione di Bruxelles del 27 settembre 1968’ [1997] RDIPP 657. 258 Joined Cases C 509/09 and C 161/10 eDate Advertising GmbH v X and Olivier Martinez, Robert Martinez v MGN Limited [2011] OJ C370/9, conclusions.

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at the place of the act in the name of the territoriality principle, but rather adopts the ubiquity theory leading to the vesting of international jurisdiction in the courts at the place of the act or alternatively in the courts at the place of the result. Yet, the ECJ has not specified as of yet if the judgments just mentioned are extendable to IPRs infringement cases. Therefore, the issue is highly debated. According to an opinion the ubiquity theory and the consolidation of infringement proceedings under the Shevill jurisprudence do not apply to IPRs cases by reason of their territorial nature: this opinion leads to a narrower scope of the court’s authority than the one proper of the Shevill jurisprudence, since the extent of both the jurisdictions at the place of the activity and the jurisdictions at the place of the result (intended in any case as being identical) would be territorially limited to the damages localised in the forum state259. Yet, another opinion adopts an opposite view and considers the ubiquity theory and the consolidation of proceedings under the Shevill jurisprudence applicable to IPRs cases despite their territorial nature260. Those opinions are extendable mutatis mutandis to the eDate jurisprudence as well, save in that the forum actoris posed by this last jurisprudence seems to be contrary to the strong position of the IPRs holder compared to the one of the personality rights owner. Finally, it is worth noting that according to Article 98(2) of the Community Trade Mark Regulation, courts in the defendant’s country of domicile, or one of the other courts listed in the ‘cascade’ of fora in Article 97 (1)-(4), have competence to adjudicate the infringement of a Community Trade Mark in its entirety, but the courts in the countries where the infringement occurred only have jurisdiction with regard to their own territory261. A corresponding rule can also be found in Article 83(2) of the Community Design Regulation. Moreover, the ECJ was recently asked to interpret Article 5(3) of the Brussels system with particular regard to the infringements which occur through 259

See Boschiero, ‘Il principio’ (n 207 Chapter I) 81; Metzger, ‘Jurisdiction in Cases’ (n 209 Chapter I) 258; Heinze, ‘A Framework for International Enforcement’ (n 210 Chapter I) 63. See also van Engelen, ‘Jurisdiction and Applicable Law’ (n 120 Chapter II) 6, who highlights that Dutch Courts appear to have taken a restrictive view of Shevill, repeatedly denying the case’s applicability to cross-border intellectual property infringements when jurisdiction is based on Article 5(3) of the Brussels I Regulation. See also further references in Metzger, ‘Jurisdiction in Cases’ (n 209 Chapter I) 261. 260 The French Cour de Cassation has applied the Shevill judgment in a variety of cases concerning intellectual property infringement. For references see de Miguel Asensio, ‘Crossborder’ (n 6 Chapter I) 122-124; Arnaud Nuyts, ‘Suing at the Place of Infringement: The Application of Article 5(3) of Regulation 44/2001 to IP Matters and Internet Disputes’ in Nuyts (n 32 Chapter I) 116; Metzger, ‘Jurisdiction in Cases’ (n 209 Chapter I). 261 See de Miguel Asensio, ‘Cross-border’ (n 6 Chapter I) 123; Metzger, ‘Jurisdiction in Cases’ (n 209 Chapter I) 260.

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the internet. Thus, in the case Olivier Martinez, Robert Martinez v Société MGN Limited the “Tribunal de Grande Instance de Paris” referred to the ECJ the following question “must Article 2 and Article 5(3) of Council Regulation (EC) No 44/2001 of 22 December 2000 on jurisdiction and the recognition and enforcement of judgments in civil and commercial matters be interpreted to mean that a court or tribunal of a Member State has jurisdiction to hear an action brought in respect on an infringement of personal rights allegedly committed by the placing on-line of information and/or photographs on an Internet site published in another Member State by a company domiciled in that second State – or in a third Member State, but in any event in a State other than the first Member State – On the sole condition that that Internet site can be accessed from the first Member State, On the sole condition that there is between the harmful act and the territory of the first Member State a link which is sufficient, substantial or significant and, in that case, whether that link can be created by: – the number of hits on the page at issue made from the first Member State, as an absolute figure or as a proportion of all hits on that page, /– the residence, or nationality, of the person who complains of the infringement of his personal rights or more generally of the persons concerned, – the language in which the information at issue is broadcast or any other factor which may demonstrate the site publisher’s intention to address specifically the public of the first Member State, – the place where the events described occurred and/or where the photographic images put on-line were taken, – other criteria?”262. In summary, the ECJ was asked to determine a socalled market impact rule263. Unfortunately the ECJ did not answer this question because it was not raised in a case pending before a court or tribunal of a Member State against whose decisions there is no judicial remedy under national law as required by Article 68(1) of the EC Treaty, but rather in a case where decisions on jurisdiction taken by the national court in the main proceedings were subject to appeal under national law264. In the absence of an ECJ judgment on this problem, EU member states adopt different solutions in relation to the IPRs infringement on the Internet. In earlier times the EU member States national courts have interpreted broadly the notion of “place where the harmful event occurred”, which was intended to include the place where an Internet service could be downloaded. This interpretation has been, however, superseded in more recent times, particularly in Germany starting from the Hotel Maritime judgment of the German Supreme Court which re262

See Reference for a preliminary ruling from the Tribunal de Grande Instance, Paris (France) lodged on 16 July 2009 – Case C-278/09 Olivier Martinez, Robert Martinez v Société MGN Limited [2009] OJ C220/56. On this case see Boschiero and Ubertazzi (n 27 Chapter I). 263 Boschiero and Ubertazzi (n 27 Chapter I). 264 Olivier Martinez (n 261 Chapter IV) conclusions.

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quired websites to be “intentionally directed” to German users for ascertaining the German courts jurisdiction265. Outside the EU frame, specifically in Japan, according to the new Japanese Act on International Jurisdiction an action related to a tort may be filed with the courts of Japan when “the tort occurred in Japan (except where the result of a harmful act committed abroad has occurred in Japan and the occurrence of that result in Japan would have been normally unforeseeable)” (Article 3-3 (viii) of Japan’s Act on International Jurisdiction). According to the common understanding of this rule, “in the cases where the place of a harmful act and the place of the result of the act differ, it is sufficient if either the act or the result took place in Japan”266. This rule applies also to IPRs, because of the absence of a specific provision on these kinds of torts and the exclusion of IPRs infringements from the scope of exclusive jurisdiction rules267. Thus, the Japanese approach would then allow a Japanese court to adjudicate an infringement case under the infringement jurisdiction rule notwithstanding the fact that the claim relates to a foreign IPR and the defendant is not domiciled in Japan, if for instance, the results of the infringement are in Japan. This would not be possible according to the territorial approach268. With particular regard to the multi-state IPRs infringements, the tendency to overcome a strict territorial approach is reflected in Japan’s New Act on International Jurisdiction, establishing that an action related to a tort may be filed with the courts of Japan when “the tort occurred in Japan (except where the result of a harmful act committed abroad has occurred in Japan and the occurrence of that result in 265 See the references to the relevant German, French and Austrian case-law in Metzger, ‘Jurisdiction in Cases’ (n 209 Chapter I) 255-257; Heinze, ‘A Framework for International Enforcement’ (n 210 Chapter I) 67. 266 See Takahashi (n 61 Chapter II) 6. See also Yokomizo, ‘Intellectual Property Infringement’ (n 149 Chapter IV) 105 and the opinion of Professor Nishitani reported in Jurys, Nishitani and Vande Walle (n 204 Chapter IV) 149. See Japan’s New Act (n 61 Chapter II). 267 See Article 3-5(3) of Japan’s New Act (n 62 Chapter IV) on exclusive jurisdiction, on which see para 16. See the annotation to Article 3-5(3) according to which “this paragraph does not cover an action for damages for infringement of an intellectual property”, see Takahashi (n 61 Chapter II) 9. See also Chaen, Kono and Yokomizo (n 51 Chapter I) 98. 268 So, as an example Professor Nishitani highlighted the following: “suppose a Japanese company operates BlackBerry devices by sending signals from Canada to the US. Then a US company claims that these activities infringe its US patents. If the Japanese company does not have any branch office in Canada, there is no jurisdiction” according to the territorial approach to infringement jurisdiction, proper also of the “CLIP Principles” (see the following remarks). However, for the sake of effective remedies, especially injunctions, it makes sense to grant jurisdiction to the Canadian courts, as the” Japanese system allows and the “ALI Principles and the Transparency Proposal suggest. Otherwise the US company would have to obtain a judgment in the US or Japan and have it enforced in Canada, even if provisional measures are available under the CLIP Principles” (see the remarks made by Nishitani referred to by Jurys, Nishitani and Vande Walle (n 204 Chapter IV) 149).

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Japan would have been normally unforeseeable)”269. Also, under Japanese law it is possible in cases of multi-state torts to claim damages for the tort in its entirety in Japan, even if it is not the place where the defendant is domiciled and it is not the place where the action causing the harm was committed. So, in Japan in determining the place of the result it is relevant to refer to the place of the effects the alleged infringing act would have upon the forum, rather than to the physical territorial connection to the forum in line with the market impact approach270. Also, the ubiquity approach is adopted in China, where the Supreme Court’s Interpretation of Several Questions on the Application of Law in online Copyright Disputes Litigation of 2000 (amended in 2006) established that for the purposes of international jurisdiction “the place of infringement includes the place where the ISP, computer terminals which operate the alleged infringing activity are located. In the cases where the place of infringement […] cannot be ascertained, the place where the computer terminal through which the plaintiff found infringing contents is located is deemed the place of infringement”271. The tendency to overcome a strict territorial approach with respect to IPRs infringement cases is evident also in the four sets of Principles. In fact, all these sets of principles, except the CLIP Principles, adopt the ubiquity theory with respect to IPRs infringements and therefore neglect the territorial approach, allowing for jurisdiction at the place where the infringement activities took place or will take place as well as at the place where the infringing results occurred or might occur. Yet, even the CLIP Principles limit the influence of the territoriality principle on their infringement jurisdiction rule. Moreover, all the principles in question allow (under different requirements) a centralised jurisdiction to adjudicate on the entire infringement without territorial limitations and heavily rely on the market impact rule272. 269

See Article 3-3 (viii) of Japan’s New Act (n 61 Chapter II). See Takahashi (n 61 Chapter II) 6. The rule in the bracket offers a valid basis to deny the jurisdiction of the Japanese courts in cases where the contacts between the forum and the tortfeasor are very weak, like in the case that infringing content is accessible from Japan without having been directed there, and without having substantial effect on the market. See Nishitani (n 61 Chapter II) 94 for further references. 270 Chaen, Kono and Yokomizo (n 51 Chapter I) 110, with reference to the Japanese Supreme Court decision of 8 June 2001 – Tsuburaya Production, Minshu Vol. 55(4) p.227; Yokomizo, ‘Intellectual Property Infringement’ (n 149 Chapter IV) 107. 271 The translation into English was kindly provided for me by Dr. Ning Zhao. See the interpretation at stake at accessed 30 November 2011. 272 In this framework, recent opinions argue against a limitation of the forum delicti to the country of protection, and therefore favour the approach adopted in this respect by those sets of principles Ancel M.E., ‘Le contentieux international de la concurrence déloyale dans la jurisprudence récente’ in (2006) JurisClasseur 14; Ancel M.E., ‘Concurrence déloyale sur In-

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Precisely, with regard to jurisdiction at the place of the action the following can be said. Section 204(1) of the ALI Principles establishes that where the court is situated in the place where the defendant has substantially acted, or taken substantial preparatory acts, to initiate or to further an alleged infringement, the court has jurisdiction and its jurisdiction extends to claims respecting all injuries arising out of the conduct, wherever the injuries occur. Thus, the ALI Principles do not adopt the wording “ubiquitous infringements”. Yet, they provide for a centralised jurisdiction in favour of the courts at the place of action independent of the means utilised to perpetrate the infringement. Hence, a non-resident defendant who operates a website in a forum on which it has placed infringing material, or who maintains broadcast facilities from which it makes infringing transmissions, is amenable to suit in that forum for damages arising out of the worldwide communication of the infringement. This solution allows for consolidation of jurisdiction, and as a result judgments, at the place from which the infringement in its entirety has emanated, such as in the country where the infringing goods were fabricated, or where the infringing content was first published. The Japanese Transparency Proposal establishes at Article 105 that Japanese courts shall have jurisdiction over an infringement claim if the infringing act took place or is to take place there. The extent of jurisdiction of the court at the place where the infringing act took place or is to take place is established by the first part of Article 105, which sets forth the general principle that infringement jurisdiction should only extend to the territory of the State where the ground for attributing such jurisdiction exists. However, the Japanese Transparency Proposal poses an escape clause. Hence, according to the second part of Article 105 Japanese courts shall decline jurisdiction over “ubiquitous infringement” claims. Furthermore, the rule establishes an escape clause to the escape clause, thus allowing the court seized to continue to exercise jurisdiction whenever the results of the ubiquitous infringements are maximised or are to be maximised in Japan. The Transparency Proposal adopts the requirement of the result rather than the infringement activities, like the ALI Principles and the Waseda Proposal. In this case the extent of jurisdiction can be over the entire infringement, wherever the injuries occur273. The Waseda Proposal poses the principle that infringement jurisdiction shall be vested in the courts in all countries where an infringement occurs, ternet: la compétence juridictionnelle française perd pied, Note a Cass. Com., 20 mars 2007’ in (2007) La Semaine Juridique 29; Ancel M.E., ‘L’arrêt GAT: une occasion manquée pour la défense de la propriété industrielle en Europe’, in (2007) ERA Forum 27; Nuyts A., ‘Suing at the Place of Infringement’ (n 261 Chapter IV) 116; Yokomizo, ‘Intellectual Property Infringement’ (n 149 Chapter IV) 106. 273 For an explanation of the proposal see Chaen, Kono and Yokomizo (n 51 Chapter I) 115-118.

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stating that “A person may be sued in any State in which infringement activities occur (Article 203 (the 1st sentence of paragraph (1)). The so-called State “in which its activities to initiate an alleged infringement occur” means not only the state in which those activities to initiate that infringement occur but also the state in which the injuries arising out of those activities occur”. The Waseda Proposal limits the extent of jurisdiction of the courts of the State where the activities occurred to the injuries occurring in that State because this is the State where the activities of the defendant were ‘directed to’. However, Article 203 (the 2nd sentence of paragraph (1)) poses an escape clause according to which when the injuries occur in multiple States, regardless of the sequence of those injuries, the person whose infringement activities give rise to those injuries may be sued in the courts of the State in which the major part of his or her activities that initiated the alleged infringement occurred. So, if the defendant did not perpetrate the major part of his/her activities in the forum State then he/she can not be sued there. Finally, it is worth noting that the second sentence of Article 203(1) is missing the word “occur” (see infra in the critics session). According to the comments to Article 203 (the 2nd sentence of paragraph (1)) the “state in which the major part of those activities occur” means the State in which the essential and substantial part of those activities occur. International jurisdiction with regard to infringements occurring in multiple States is then granted to the courts in the country where the essential and substantial part of the activities initiating the infringement took place. This court can deal with all the claims arising out of that infringement, irrespective of the fact that they are located outside the forum State. In sum, the ALI Principles, the Transparency Proposal and the Waseda Proposal all provide for jurisdiction at the place of the action. The court’s authority is unlimited in scope under the ALI Principles. There is limited scope of the court’s authority under the Japanese Transparency Proposal, except for ubiquitous infringements where the results are maximized in Japan and under the Waseda Proposal there is unlimited scope in multistate infringements where the major part of his/her activities occurred in the forum State. With regard to jurisdiction at the place of the infringement/result the following can be said. The ALI Principles stipulate that the plaintiff may also utilise the court of any State in which the defendant’s activities give rise to an infringement claim. The extent of the jurisdiction of the court of the State where the infringement occurred is limited to activities occurring in the forum State. As for the escape clause of the ALI Principles, according to the second sentence of Section 204(2) the jurisdiction of the courts at the place of infringement can be denied if the defendant did not direct274 his/her activities to that State. 274

On this requirement see Dreyfuss, ‘Resolution Through Conflict of Laws’ (n 209 Chapter I) 831.

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The Japanese Transparency Proposal establishes at Article 105 that Japanese courts shall have jurisdiction over infringement if the results of an IPR infringement occurred or are to occur in Japan. The extent of jurisdiction of the court at the place where the results of the infringement occurred or are to occur is established by the first part of Article 105, which sets forth the general principle that infringement jurisdiction should only extend to the territory of the State where the ground for attributing such jurisdiction exists. However, the Japanese Transparency Proposal poses an escape clause. Hence, according to the second part of Article 105 Japanese courts shall decline jurisdiction over “ubiquitous infringement” claims. Furthermore, the rule establishes an escape clause to the escape clause, thus allowing the court seized to continue to exercise jurisdiction whenever the results of the ubiquitous infringements are maximised or are to be maximised in Japan. In this case the extent of jurisdiction can be over the entire infringement, wherever the injuries occur. So, if the infringements at stake are perpetrated throughout ubiquitous media such as the Internet and the State of the forum (state of the activity) is also the State where the results of the infringement are maximized, then the second sentence of Article 105 confers a centralized jurisdiction on the courts seized at the place of the results, which can then adjudicate the entire infringement claims wherever the injuries occur275. The Waseda Proposal poses the principle that infringement jurisdiction shall be vested in the courts in all countries where an infringement occurs, stating that “A person may be sued in any State in which infringement activities occur (the 1st sentence of paragraph (1)). The so-called “state in which its activities to initiate an alleged infringement occur” means not only the State in which those activities to initiate that infringement occur but also the State in which the injuries arising out of those activities occur. Thus, the comments first reintroduce the category of activities, which is not present in the text, and then characterize this category as encompassing both activities and results. However, Article 203 (the 2nd sentence of paragraph (1)) poses an escape clause according to which when the injuries occur in multiple States, regardless of the sequence of those injuries, the person whose infringement activities give rise to those injuries may be sued in the courts of the State in which the major part of his or her activities that initiated the alleged infringement occurred. So, if the defendant did not perpetrate the major part of his/her activities in the forum State then he/she cannot be sued there, even though some of the injuries occurred there. Finally, as already mentioned it is worth noting that the “state in which the major part of those activities occur” means the State in which the essential and substantial part of those activities occur. International jurisdiction with regard to infringements occurring in multiple 275

For an explanation of the proposal see Chaen, Kono and Yokomizo (n 51 Chapter I) 115-118.

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States is then granted to the courts in the country where the ‘major part’ of the activities initiating the infringement took place. This court can deal with all the claims arising out of that infringement irrespective of the fact that they are located outside the forum State. Moreover, this centralized adjudication applies not only to an infringement carried out through ubiquitous media as required by the Transparency Proposal but also to a general infringement initiating injuries in multiple States. In sum, the ALI Principles, the Transparency Proposal and the Waseda Proposal establish jurisdiction at the place of the infringement/results. This court’s authority has a territorially limited scope. Yet, the sets of principles under examination establish an escape clause for cases where the activities were not directed to the forum State (ALI Principles); for ubiquitous infringements (Transparency Proposal), and for multistate infringements cases (Waseda Proposal). Yet, in case of ubiquitous infringements (Transparency) and multistate infringements (Waseda) a centralized jurisdiction at the place of the infringement is established under certain requirements. In contrast, the CLIP Principles strictly adhere to the territoriality principle and therefore do not distinguish between the place of the acts and the place of results but simply adopt the notion of infringement of IPRs. This notion is intended as comprehensive of activity and results, which cannot be split up due to the territorial nature of IPRs. In fact, Article 2:202 stipulates that in disputes concerned with infringement of an IPR, a person may be sued in the courts of the State where the alleged infringement occurs or may occur. Yet, the approach of the CLIP Principles in relation to territoriality should be mitigated. Firstly, the CLIP Principles do not refuse the extension of the ubiquity theory to IPRs cases by reason of the territoriality principle intended in the traditional way, namely as a characteristic typical of those rights. Rather those Principles refuse to apply the ubiquity theory to IPRs cases by reason of the territoriality principle intended in a new way, namely as being an expression of the proximity principle and therefore as determining the most proximal and best placed court to adjudicate those cases as always in the courts of the countries of protection of the IPRs involved. Second, the CLIP Principles’ refusal to apply the ubiquity theory to IPRs cases derives from the act-based conception of IPRs infringement, under which “whereas traditional tort distinguishes between act, causation and damage, the infringement of an IPR requires only that the defendant committed an act which falls in the scope of the absolute right of the right holder”276. Third, the same refusal originates in the criticism of the place of the action as an adequate jurisdiction criterion, particularly in Internet cases, since the place of the server can be manipulated too easily; webspace and other host services are typically offered by third parties that are acting in a state other than the one of the person that uploads the infringing 276

Heinze, ‘A Framework for International Enforcement’ (n 210 Chapter I) 63.

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material; and it is usually difficult to prove where this uploading took place277. Fourth, the CLIP Principles even adopt an “effects–oriented approach”, in that under Art. 2:202 the infringing conduct that can base the infringement jurisdiction includes the activity directed to a certain State and that has a substantial effect in this same State. As such the Principles implement the above mentioned “directed to” test proper of German jurisprudence and the “commercial effects” rule proposed by the WIPO Joint Recommendation Concerning the Protection of Marks, and Other Industrial Property Rights in Signs, on the Internet278. In any case, Article 2:203 paragraph 1 of the CLIP Principles sets forth the general principle that infringement jurisdiction should only extend to the territory of the State where the ground for attributing such jurisdiction exists, ie, the State where the infringement occurred or may occur. Yet, due to the territorial limitation of the jurisdiction at the place of the infringement provided for by the CLIP Principles, the same Principles considered it necessary to allow for centralized jurisdiction in one single case, namely when the infringements are perpetrated through ubiquitous media. In these cases Article 2:203 paragraph 2 of the CLIP Principles establishes an alternative forum in favor of the court that has jurisdiction according to Article 2:202. This court shall exercise jurisdiction with respect to the entire infringement without territorial limitations, namely the infringement that occurs or may occur within the territory of the forum State as well as in any other States, provided that the following requirements are met. First, infringements shall be carried out through ubiquitous media. Second, the activities allegedly causing the infringement shall have no substantial effect in the State or States where the alleged infringer is habitually resident. Third, it must be established that either substantial activities in furtherance of the infringement have been carried out in the forum State, or that the harm accruing in that State is substantial in relation to the infringement in its entirety279. Also, another tendency to overcome a strict territorial approach concerns the rules that, as emphasised in chapter II, allow courts to adjudicate foreign IPRs infringement claims and validity issues incidentally raised. Also, the same tendency to overcome a strict territorial approach related to the exclusive jurisdiction rules is adopted in two of the four sets of Principles, namely the ALI Principles and the Transparency Proposal, that, as empha-

277

Metzger, ‘Jurisdiction in Cases’ (n 209 Chapter I) 259. Heinze, ‘A Framework for International Enforcement’ (n 210 Chapter I) 67. On the WIPO Joint Recommendation see supra, footnote 2. 279 See Drexl and Kur (n 13 Chapter I) 310 (proposal) and 329 (comment); Metzger, ‘Jurisdiction in Cases’ (n 209 Chapter I) 259-260; Heinze, ‘A Framework for International Enforcement’ (n 210 Chapter I) 67. 278

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sised in chapter II, go even further in allowing a forum State court to examine also the validity of foreign IPRs principally raised. 63. Second Group of PIL Provisions Deviating from the Territoriality Principle: Rules that Adopt Connecting Factors which are not Based on the Territoriality Principle A second group of PIL provisions deviating from the territoriality principle encompasses the PIL norms that adopt connecting factors which are not based on the territoriality principle. Before analysing those rules in details, it is worth recalling that the law applicable to IPRs claims has been controversial for at least the last 40 years. Thus, already in the 1970s a first opinion pleaded for the application of a single law, the law of the country of origin, to IPRs, in light of the continental theory of copyright as a personal right, as well as of the practical difficulties determined by the application of the law of each and every State that granted the IPR in question280. However, this early universalist approach was not followed by the prevailing opinion, which adopted the traditional territorial concept281. Later on in the early 1990s, after the World Wide Web was established “some of the old partisans of the lex originis approach and a fast growing number of new adepts raised the argument that a territorial concept of intellectual property would be outdated and should be avoided when deciding cases from ‘cyberspace’. Against this background, the discussion on territoriality or universalism in intellectual property heated up again in the early 1990s and has been debated vividly ever since”282. In this frame the following rules are relevant either as an expression of the adoption of the universalist approach, or as examples of norms deviating from the territoriality principle traditionally intended. Firstly, Article 2 of the Montevideo Convention of 1889283 states that “authors of a literary or artistic work and their successors shall enjoy in the Signatory States the rights granted to such authors by the law of the State in which first publication or production of the work took place”284. This Convention was ratified by several American and European States. However, its “sys-

280

See Haimo Schack, Zur Anknüpfung des Urheberrechts im internationalen Privatrecht (Berlin, Dunker & Humblot 1977) 23. See also the other literature quoted in Metzger, ‘Applicable Law Under The CLIP-Principles’ (n 2 Chapter I) 157-158 footnote 2. 281 See François Dessemontet, ‘Conflict of Laws for Intellectual Property in Cyberspace’ (2001) 18 J. Int’l Arb. 487, 506-07; Metzger, ‘Applicable Law Under The CLIP-Principles’ (n 2 Chapter I) 158 and the literature quoted by him. 282 Metzger, ‘Applicable Law Under The CLIP-Principles’ (n 2 Chapter I) 158. 283 See supra, para 5. 284 On this rule see Moura Vicente (n 209 Chapter I) 269.

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tem never worked and the Convention has, in practical terms, been abandoned, and most Member States have now joined the Berne Convention”285. Secondly, relevant in this respect are the provisions that designate the lex originis rather than the lex loci protectionis as the applicable law to the IPR first ownership issue: namely in the EU Article 67 of the Greek copyright Act; the Portuguese PIL rule for IPRs acquisition; the French PIL jurisprudential system, according to which the initial ownership of IPRs fall under the lex originis, whereas their content and scope are ruled by the lex loci protectionis286. Outside the EU, the US plead for the law of the country of origin as well287. Thirdly, relevant are also the rules allowing for the application of the law applicable to an employment relationship where the inventor is an employee. Particularly, the EPC refers to the law of the country in which the employee is mainly employed. When that country cannot be determined, the EPC designates the law of the country where the employer has his/her place of business to which the employee is attached288. Certain other norms, such as Article 93(2) of the Belgian PIL Act of 2004, establish a rebuttable presumption that the lex contractus governs initial ownership in cases where IPRs results from contractual relations289. Fourthly, certain rules confer on the parties of an IPRs infringement proceeding the right to choose the forum law as the applicable law to the entire infringement issue: namely Article 110 of the Swiss PIL Statute, which allows the parties to agree, after the occurrence of the infringement, on the lex fori as the applicable law to the same infringement290; and Article 50 of the “Law of the People’s Republic of China on the law applicable to foreign-related civil relations” adopted on October the 28th 2010, according to which “liability for infringing intellectual property rights is governed by the law of the place

285

Fawcett and Torremans (n 51 Chapter I) 685. See Boschiero, ‘Infringement of Intellectual Property Rights’ (n 206 Chapter IV) 32; Moura Vicente (n 209 Chapter I) 279; Basedow, ‘Foundations of Private International Law’ 14 and 18; Metzger, ‘Applicable Law Under The CLIP-Principles’ (n 2 Chapter I) 160. 287 Metzger, ‘Applicable Law Under The CLIP-Principles’ (n 2 Chapter I) 160. 288 See Article 60 of the European Patent Convention (n 3 Chapter I) on the right to a European Patent according to which “(1) The right to a European patent shall belong to the inventor or his successor in title. If the inventor is an employee, the right to a European patent shall be determined in accordance with the law of the State in which the employee is mainly employed; if the State in which the employee is mainly employed cannot be determined, the law to be applied shall be that of the State in which the employer has the place of business to which the employee is attached”. On this rule see Basedow, ‘Foundations of Private International Law’ (n 148 Chapter I) 18-19. 289 Basedow, ‘Foundations of Private International Law’ (n 148 Chapter I) 19. 290 See Boschiero, ‘Infringement of Intellectual Property Rights’ (n 206 Chapter IV) 32; Basedow, Foundations of Private International Law’ (n 148 Chapter I) 24. 286

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where protection is sought. The parties may also choose to apply the law of the forum after the infringement occurs”291. Fifthly, regarding geographical indications lato sensu intended, a very consistent number of international, EU and national provisions determine the application of the lex originis rather than of the lex loci protectionis to issues of existence, validity, ownership and infringement292. So, the ECJ in the Budjovický Budvar case of 2009 explicitly stated that the “mechanism” for protection of geographical indications lato sensu intended “is distinguished by the fact, derogating from the principle of territoriality, that the protection conferred is determined by the law of the Member State of origin and by factual circumstances and perceptions in that State”293. Sixthly, the lex originis is also designated by the “Nagoya Protocol on Access to Genetic Resources and the Fair and Equitable Sharing of Benefits Arising from their Utilization to the Convention on Biological Diversity”, which was adopted on 29 October, 2010294. Its Article 16 determines as the applicable law the law of the country of origin by stating that “each State party shall adopt measures to provide that traditional knowledge associated with genetic resources that is utilized within its jurisdiction has been accessed in accordance with prior informed consent, mutually agreed terms and other requirements established by the law of the country of origin of this traditional knowledge; that each State party shall adopt measures also to address situations of non-compliance with the lex originis; and finally shall cooperate with the competent authorities of the country of origin of the traditional knowledge in cases of an alleged violation of the law of the country of origin perpetrated within the State Party’s territory”295. 291 See the law translated into English at the WIPO website at accessed 30 November 2011. 292 Otero García-Castrillón (n 184 Chapter IV) 65 and there for further references. 293 Case C-478/07 Budjovický Budvar, národní podnik v Rudolf Ammersin GmbH [2009] OJ C267/21, para 79. See also Case C 3/91 Exportur [1992] ECR I-5529, paras 12, 13 and 38. 294 The Nagoya Protocol (n 163 Chapter I) will enter into force 90 days after the deposit of the fiftieth instrument of ratification, acceptance, approval, or accession. As of 20 May 2011, the Protocol has obtained the signatures of 24 States. Text available at accessed 30 November 2011. On this Protocol see Tsioumani (n 163 Chapter I) 288; Crompton (n 163 Chapter I); Kursar (n 163 Chapter I) 256; de Miguel Asensio, ‘Transnational Contracts’ (n 162 Chapter I) para 2. 295 See Article 16 of the Nagoya Protocol on Compliance with Domestic Legislation or Regulatory Requirements on Access and Benefit-Sharing for Traditional Knowledge Associated with Genetic Resources, according to which “1. Each party shall take appropriate, effective and proportionate legislative, administrative or policy measures, as appropriate, to provide that traditional knowledge associated with genetic resources utilized within their jurisdiction has been accessed in accordance with prior informed consent or approval and involvement of indigenous and local communities and that mutually agreed terms have been established, as required by domestic access and benefit-sharing legislation or regulatory re-

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Seventhly, the four sets of Principles establish certain deviations from their principal PIL provisions, which designate the lex loci protectionis, limiting its scope and moderating, as such, the territoriality principle296. In effect, relevant in this respect are the provisions that determine the lex originis as the applicable law to initial ownership and the lex contractus as the applicable law to initial ownership in cases where IPRs results from contractual relations, such as Sections 311-313 of the ALI Principles297. Furthermore, all of the sets of Principles, except for the Transparency Proposal, provide analogous rules for ubiquitous and multi-state infringement allowing the court to apply a single law, as opposed to the laws of each of the countries for which protection is sought (the so-called mosaic approach)298. Such a law is to be determined according to the closest connection rule, on the basis of a set of connecting factors facilitating the determination of that law. The Transparency Proposal, in addition, follows a single-law approach, but provides for a different applicable law rule, which is specifically the law of the country where the effects of the right’s exploitation are (or are likely to be) maximized (the “maximum results” rule), with the possibility that some countries will be exempted from the universal application of the selected

quirements of the other Party where such indigenous and local communities are located; 2. Each Party shall take appropriate, effective and proportionate measures to address situations of non-compliance with measures adopted in accordance with paragraph 1 above; 3. Parties shall, as far as possible and as appropriate, cooperate in cases of alleged violation of domestic access and benefit-sharing legislation or regulatory requirements referred to in paragraph 1 above”. 296 On these deviations see Annette Kur, ‘Applicable Law: An Alternative Proposal for International Regulation’ (2005) 30 Brook. J. Int’l L. 966; Metzger, ‘Applicable Law Under The CLIP-Principles’ (n 2 Chapter I) 157; Yokomizo, ‘Intellectual Property Infringement’ (n 149 Chapter IV) 107. 297 See Basedow, ‘Foundations of Private International Law’ (n 148 Chapter I) 19. In contrast, the CLIP Principles stick to the lex loci protectionis as far as copyright and the entitlement to IPRs is concerned, as per Basedow, ‘Foundations of Private International Law’ (n 148 Chapter I) 20; Metzger, ‘Applicable Law Under The CLIP-Principles’ (n 2 Chapter I) 160; Rita Matulionyté, Law Applicable to Copyright. A Comparison to the ALI and CLIP Proposals (Cheltenham, Edward Elgar 2011) 203. See also Dessemontet, ‘The ALI Principles’ (n 20 Chapter I) 41, according to whom this is one of the areas where “the territoriality principle seems practically inadequate in a world of 200 countries”. 298 See Basedow and Metzger, ‘Lex loci protectionis europea’ (n 207 Chapter IV) 164; Dinwoodie, ‘Conflicts and International Copyright Litigation’ (n 101 Chapter III) 201; Drexl, ‘Internationales Immateralgüterrecht’ (n 124 Chapter IV) 206; van Eechoud (n 146 Chapter IV) 169; Ginsburg, ‘Private International Law Aspects’ (n 2 Chapter I) 36; Matulionyté (n 298 Chapter IV) 166; Kur and Ubertazzi (n 32 Chapter I) 89; Basedow, ‘Foundations of Private International Law’ (n 148 Chapter I) 24; Yokomizo, ‘Intellectual Property Infringement’ (n 149 Chapter IV) 108; Metzger, ‘Applicable Law Under The CLIP-Principles’ (n 2 Chapter I) 174.

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law299. Yet equally, these proposals provide for exceptions from the singlelaw approach, which allow parties to claim that the law(s) of another State(s) provide(s) a different solution than that reflected by the single applicable law. In addition, another deviation from the territoriality principle can be found in the rules of the sets of Principles in question that suggest the application of a de minimis rule300 in international IP law. Those rules target multistate infringement cases and establish that the court should be free to focus on those countries in which the alleged infringement has either caused a substantial effect or in which the alleged infringer has substantially acted301. Finally, another relevant deviation from the territoriality principle can be found in the norms of the four sets of Principles examined here that allow for freedom of choice for the remedies in infringement cases under certain requirements302, such as Article 3:606 of the CLIP Principles, § 302 paras. 1 and 2 of the ALI Principles303, and Article 305 of the Transparency Proposal304. 299

See Kojima Ryu, Shimanami Ryo and Nagata Mari, ‘Applicable Law to Exploitation of Intellectual Property Rights in the Transparency Proposal’ in Basedow, Kono and Metzger (n 2 Chapter I) 198; Matulionyte (n 298 Chapter IV) 166. 300 Matulionyté (n 298 Chapter IV) 146. See also the literature quoted at the following footnote. 301 See Article 3:602: De minimis rule, according to which “(1) A court applying the law or the laws determined by Article 3:601 shall only find for infringement if (a) the defendant has substantially acted or has taken substantial preparatory action to initiate or further the infringement in the State or the States for which protection is sought, or (b) the activity by which the right is claimed to be infringed has substantial effect within, or is directed to the State or the States for which protection is sought. (2) The court may exceptionally derogate from that general rule when reasonable under the circumstances of the case”. On this rule see Kur, ‘Applicable Law: An Alternative Proposal’ (n 297 Chapter IV) 966; Metzger, ‘Applicable Law Under The CLIP-Principles’ (n 2 Chapter I) 172-173, explaining that “this provision is not a private international law rule stricto sensu but a rule of interpretation which should be applied on the substantive law level. […] The model for the rule has been Article 2 of the Paris Union and WIPO ‘Joint Recommendation Concerning the Protection of Marks, and Other Industrial Property Rights in Signs, on the Internet,’ which recommends a cautious application of national (or regional) trademark law in Internet cases. The Recommendation has already been applied by national courts, e.g., the German Federal Court of Justice in the Hotel Maritime case”. See ‘German Federal Court of Justice, 13 October 2004’ [2005] GRUR Int 431. On the Recommendation see supra, para 1. 302 Matulionyté (n 298 Chapter IV) 230. See also the literature quoted at the following footnote. 303 Metzger, ‘Applicable Law Under The CLIP-Principles’ (n 2 Chapter I) 176-177. 304 Transparency Proposal (n 60 Chapter I). This norm establishes that “the existence, primary ownership, transferability and effects of intellectual property rights shall be governed by the law of the country that granted the intellectual property right. Any choice of law agreement by the parties concerning these matters shall be null and void”. Thus, this rule does not explicitly allow the choice of law for remedies. However, its interpretation is in the sense that it does not exclude the choice of law for remedies and therefore it accepts it. This inter-

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64. Third Group of PIL Provisions Deviating from the Territoriality Principle: Rules Allowing Recognition and Enforcement of Foreign Judgments Rendered by Courts of States other than the IPRs Granting Countries A third group of PIL provisions deviating from the territoriality principle relates to the norms according to which foreign judgments on IPRs claims rendered by courts of States other than their respective territorial granting countries can be recognised and enforced in the States where their recognition and enforcement is sought. In contrast, other existing rules invoke the territoriality principle as a reason for impeding such recognition and enforcement of the foreign judgments in issue. Both sets of norms will be analysed in detail in chapter V. For present purposes it suffices to highlight that the former rules allowing for the recognition and enforcement of the foreign judgments in issue constitute another deviation from the territoriality principle that is to be welcomed, as it is demonstrated inter alia by the Transparency Proposal, namely in that it explicitly declines the possibility of invoking territorial reasons not to recognise and enforce a foreign judgment. In contrast, the latter norms denying the recognition and enforcement of a foreign judgment by reason of the territoriality principle are highly questionable for reasons that will be exposed in chapter V.

V. Conclusions V. Conclusions 65. Overcoming the Exclusive Jurisdiction, the Exclusive Designation of the Lex Loci Protectionis and the Impossibility of Recognising and Enforcing Foreign Judgments Rendered by Courts other than the Ones having Exclusive Jurisdiction or According to a Law other than the Lex Loci Protectionis A first consequence of the thesis here proposed relates to jurisdiction. From a de lege lata perspective the PIL norms that vest exclusive jurisdiction in a specific court in relation to IPRs cases shall be interpreted according to the territoriality principle based on the proximity principle, and therefore as not impeding the vesting of jurisdiction in a court other than the exclusively competent one, when the “different” court is more proximal to the concrete case than the “exclusively” competent court, therefore allowing for a better allocation of jurisdiction with respect to the case. In contrast, from a de lege ferenda perspective when the proposed interpretation of those existing PIL rules is not possible, they shall be overruled.

pretation is in line with the Japanese PIL related to ordinary tort liability and with the opinion that IPRs infringement should not differ from general torts in this respect. See Ryu, Ryo and Mari (n 300 Chapter IV) 203-204.

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A second consequence relates to the applicable law. Thus, the territoriality principle based on the proximity principle shall not be interpreted anymore as determining the exclusive application of the lex loci protectionis in relation to IPRs cases. So, from a de lege lata perspective, the PIL norms that determine the application of the lex loci protectionis in relation to IPRs cases shall be interpreted as not impeding the designation of an applicable law, such as the lex originis, or, under certain requirements, the law chosen by the parties, whenever the different law chosen is more proximal to the concrete case than the lex loci protectionis, therefore allowing for a more efficient and fair adjudication. In contrast, from a de lege ferenda perspective, when the proposed interpretation of those existing PIL rules is not possible, they shall be overruled. A third consequence of the thesis here proposed relates to the recognition and enforcement of foreign judgments. From a de lege lata perspective the PIL norms that ground the refusal to recognise and enforce a foreign judgment on the territorial nature of IPRs shall be interpreted according to the territoriality principle based on the proximity principle, and therefore as not impeding the recognition and enforcement of judgments rendered by a court other than the exclusively competent one, when the “different” court is more proximal to the concrete case than the “exclusively” competent court, therefore allowing a better allocation of jurisdiction with respect to the case. In contrast, from a de lege ferenda perspective when the proposed interpretation of those rules is not possible, they shall be overruled. Similarly, from a de lege lata perspective, the PIL norms that condition the recognition and enforcement of a foreign judgment on the control of the law applied, being this law the lex loci protectionis, shall be interpreted as not impeding the recognition and enforcement of foreign judgments that applied a different applicable law, such as the lex originis, or, under certain requirements, the law chosen by the parties, whenever the different law so determined is more proximal to the concrete case than the lex loci protectionis, therefore allowing for a more efficient and fair adjudication. In contrast, from a de lege ferenda perspective, when the proposed interpretation of those existing rules is not possible, they shall be overruled.

Chapter V

Other Arguments are Insufficient to Mandate Exclusive Jurisdiction Rules Chapter V: Other Arguments

are Insufficient

66. Introduction There are at least eight other arguments used to ground exclusive jurisdiction rules in addition to the act of State doctrine, the comity doctrine, and the territoriality principle. These are the following. According to a first rationale exclusive jurisdiction rules derive from the Moçambique rule. A second rationale bases exclusive jurisdiction rules on the double actionability rule. A third rationale of exclusive jurisdiction rules is based on the fact that they would promote the sound administration of justice and judicial economy. According to a fourth rationale exclusive jurisdiction rules determine the best placed courts to adjudicate IP disputes. A fifth rationale ground exclusive jurisdiction rules on the need to avoid the application of foreign laws by the forum State court, since the difficulties of applying foreign IP laws are too great. A sixth rationale bases exclusive jurisdiction rules on the alleged impossibility of recognizing and enforcing judgments on foreign IPRs in their respective countries of registration. According to a seventh rationale exclusive jurisdiction rules are grounded on the fact that IPRs are registered in public registries, and since the foreign judgments have as their object the validity or legality of entries in these public registers, they cannot be recognised in the country where the register is kept. An eighth rationale bases exclusive jurisdiction rules on the application of the forum non conveniens doctrine to IPRs cross-border litigation. For simplicity, these arguments will be referred to all together as the “other arguments”. Each of these arguments fails on its own merits for reasons that are addressed below. Additionally, the ‘other arguments’ are also strongly correlated to the act of State, comity and territoriality principles and all the reasons that counsel against using those three doctrines to limit jurisdiction over foreign IPRs claims are extendable, mutatis mutandis, to the other arguments. Finally, even if in arguendo the other arguments were convincing, the exercise of international jurisdiction over foreign IPRs would still not be impeded by them since under general public international law a State’s declining of

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jurisdiction under exclusive jurisdiction rules implies a denial of justice and is contrary to the human right of access to a court1. 67. Foreign Immovable Property, Local Actions, the Moçambique Rule and Article 22(1) of the Brussels System The first of the alternative arguments used to support exclusive jurisdiction rules is derived from “the principle of non-justiciability for claims concerning foreign land, established over a century ago in the Moçambique case”2. In the British South Africa Co v Companhia de Moçambique decision of 18933, the UK House of Lords established that English Courts lacked subject matter jurisdiction over claims related to trespass, the right of possession, or any other tort against the right of property in immovable foreign tangibles. This includes foreign land, by virtue of the fact “that jurisdiction in relation to land is local (that is, the claim has a necessary connection with a particular locality) as opposed to transitory (where such a connection is not necessary) and that it is contrary to international law, or comity, for one state to exercise jurisdiction in relation to land in another state”4. The UK decision of Moçambique provides an authoritative foundation for the rule that the English court “has no jurisdiction to entertain an action for (1) the determination of the title to, or the right to the possession of, any immovable situate out of England […] or (2) the recovery of damages for trespass to such immovable”. The Moçambique rule was initially handed down in 1893 and has been severely restricted in more recent years. The rule was first restricted in the UK by Section 30(1) of the UK Civil Jurisdiction and Judgment Act 1982, thereby allowing English courts to hear proceedings for trespass to, or any other tort affecting, immovable property “unless the proceedings are principally concerned with a question of title to, or the right to possession of, that property”5. The Moçambique rule was further limited by Article 22(1) (formerly Article 16(1)(a) of the Brussels system6, which establishes exclusive jurisdiction in the courts of the Member State in which the property is situated but only with respect to “proceedings which have as their object rights in rem in immovable property or tenancies of immovable property”. This confirms that

1

See the next chapter. Dickinson (n 29 Chapter I) 183. See also the literature quoted at the following footnotes. 3 British South Africa Co v Companhia de Moçambique [1893] AC 602. 4 Lucasfilm Ltd & Ors v Ainsworth & Anor (n 30 Chapter I) 56 and 59. 5 See Kurt Lipstein, ‘Intellectual Property: Jurisdiction or Choice of Law?’ (2002) 61(2) CLJ 300; Fawcett and Torremans (n 51 Chapter I) 296. See also Lucasfilm Ltd & Ors v Ainsworth & Anor (n 30 Chapter I) 71. 6 See supra, para 2. 2

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other types of claims, including infringement disputes, fall outside this rule, as was also maintained by the ECJ7. The US Courts have adopted a similar rule, called the local action doctrine for actions to determine title8. According to this traditional rule, US Courts cannot exercise jurisdiction over any “local” action involving real property unless the property is located within the territorial bounds of the US state in which the court is located9. This rule has been applied to prevent courts from exercising jurisdiction over actions for trespass to land located in other US states as well as foreign states10. The original interpretation of the Moçambique rule, which denies jurisdiction for trespass to foreign land, has no counterpart outside of common law countries11. With express regard to the extension of the Moçambique rule to IPRs, the following comments can be made. In 1906, the Moçambique rule was first extended to IPRs by the Australian High Court in Potter v The Broken Hill Proprietary Co12. In this case, the Australian Court dismissed a challenge to the validity of a foreign patent for the following reasons: first, because a foreign patent right is a creation of the sovereign power of a foreign state and validity of such acts done under sovereign power are not examinable by the courts of another State; and second, because it found the reasoning behind the 7

For example, the Case C-343/04 Land Oberösterreich v CEZ as [2006] ECR I-4557 confirmed that Article 16(1)(a) of the Brussels Convention (now Article 22(1) of the Brussels Regulation) stated that actions for damages based on infringement of rights in rem or on damage to property in which rights in rem exist do not fall within its scope (para [26] et seq). The same conclusion was reached by the ECJ in the Case C-294/92 Webb v Webb [1994] ECR I1717, para 19 and conclusions, where the ECJ maintained that “an action for a declaration that a person holds immovable property as trustee and for an order requiring that person to execute such documents as should be required to vest the legal ownership in the plaintiff does not constitute an action in rem within the meaning of Article 16(1) of the Brussels Convention”, but is a personal action, also within the meaning of the Convention. On the Land Oberösterreich case see Lucasfilm Ltd & Ors v Ainsworth & Anor (n 30 Chapter I) 75. On the Webb case see Benedetta Ubertazzi, ‘Trust in Italian and Spanish International Law. Part I’ (2006) Trusts and Trustees 14-19; ‘Part II’ (2007) Trusts and Trustees 7-13. See also Gavin Love (ed), ‘Action to prevent nuisance not action concerning right in rem’ (2006) 189 EU Focus 10. 8 See Lucasfilm Ltd & Ors v Ainsworth & Anor (n 30 Chapter I) 55. See also Toraya (n 23 Chapter III) 1183 and the case-law and literature quoted by Toraya. 9 Bigio v The Coca-Cola Company 239 F. 3d 440, 449-450 (2nd Cir. 2000). 10 See for example, Pasos v Pan American Airways 229 F. 2d 271 (2nd Cir. 1956), where the Court of Appeal for the Second Circuit refused to hear claim for trespass to land in Nicaragua for lack of jurisdiction due to the local action doctrine. 11 Lucasfilm Ltd & Ors v Ainsworth & Anor (n 30 Chapter I) 55. 12 Potter (n 46 Chapter II). On this case see supra, para 16. See also Baddeley (n 52 Chapter II) 38; Austin, ‘The Concept of "Justiciability"’ (n 29 Chapter I) 395. Recently see Lucasfilm Ltd & Ors v Ainsworth & Anor (n 30 Chapter I) 60.

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Moçambique rule, namely the distinction between “local” and “transitory” actions, to be equally applicable to foreign patents due to their territorial nature13. In contrast, UK courts did not consider the Moçambique rule to be a significant authority in the field of transnational IP litigation until the 1980s14. More recently, the UK Court of Appeal’s Lucasfilm ruling emphasised the analogy between tangible properties and IPRs and referred to the Moçambique rule to maintain the principle of non-justiciability for claims concerning foreign copyrights15. In the US, several judgments have used the local action doctrine as an analogy to deny jurisdiction in foreign registered IPRs cases, finding that since “the territorial limits of the rights granted by patents are similar to those conferred by land grants”, it is therefore “incongruent to allow the sovereign power of one to be infringed or limited by another sovereign’s extension of its jurisdiction”16. Among those judgments are the following. In the Voda case, the US Court of Appeals for the Federal Circuit maintained that the local action doctrine prevents courts from adjudicating claims for trespass or title to foreign real property in order to safeguard the sovereignty of foreign states. The Court emphasised that the doctrine also applied to IPRs since “the territorial limits of the rights granted by patents are similar to those conferred by land grants [given that] a patent right to exclude only arises from the legal right granted and recognised by the sovereign within whose territory the right is located”17. Therefore, the Court stated that the “local action doctrine constitutes an “informative doctrine counseling” against exercising jurisdiction over foreign IPR infringement claims because “it could prejudice the rights of foreign governments”18. In Packard Instrument, the US District Court for the Northern District of Illinois maintained that “the considerations underlying the local-transitory dichotomy […] are pertinent” in the case in issue in order to permit the nine “foreign patent[s] claim[s] […] be treated as local rather than a transitory action[s], because the validity of a patent, like the title to 13

Fawcett and Torremans (n 51 Chapter I) 299. See also Baddeley (n 52 Chapter II) 38. On recent developments in Australia see supra, para 16. Recently see Lucasfilm Ltd & Ors v Ainsworth & Anor (n 30 Chapter I) 60. 14 Lucasfilm Ltd & Ors v Ainsworth & Anor (n 30 Chapter I) 68, recalling the following copyright cases: Def Lepp Music v Stuart-Brown [1986] RPC 273; Tyburn Productions Ltd v Conan Doyle [1991] Ch 75. 15 Lucasfilm Entertainment (n 29 Chapter I) 174–186. See in critical terms Dickinson (n 29 Chapter I) 183; Torremans, ‘Lucasfilm v Ainsworth’ (n 29 Chapter I) 753. On the Lucasfilm Court of Appeal’s ruling see supra, paras 1 and 3. 16 Voda (n 31 Chapter I) 902. 17 Ibid 901-902, according to which “it would be incongruent to allow the sovereign power of one to be infringed or limited by another sovereign’s extension of its jurisdiction”. 18 Ibid 902.

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land, is governed by distinctively local law and depends upon local procedures and records, all of which are best understood by local tribunals”19. In Vanity Fair, the United State Court of Appeals for the Second Circuit did not explicitly discuss the local action doctrine, but alluded to it when it distinguished claims challenging the validity of a foreign IPR from “the ordinary transitory action for it seeks to have the Courts of one country invalidate a recognition of a status granted by a foreign country to a citizen of that country and effective only in that country”20. The Court later noted that “[w]ere this merely a transitory tort action in which disputed facts could be litigated as conveniently here as in Canada, we would think the jurisdiction of the district court should be exercised”21. However, because the Court would be challenging the actions of a State government, it refused to exercise jurisdiction over the validity claim22. Yet, the argument for extending the Moçambique rule to IPRs is unconvincing, as has recently been maintained by higher courts in foreign copyright infringement cases in the UK, in the Supreme Court’s Lucasfilm decision23 and in New Zealand in the High Court’s KK Sony judgment, both of which were based on the UK Pearce v Ove ruling24. Similarly, recent Australian case law “eroded the basis” for the Moçambique rule rendering it possible for Australian courts to decide actions involving the infringement of foreign registered and unregistered IPRs25. In the US, courts have not extended the local action rule to foreign copyright infringement claims26. The arguments grounding the UK Supreme Court’s Lucasfilm ruling refusing to extend the Moçambique rule to foreign copyright infringement claims are of particular note and are addressed below. An initial argument against extension of the Moçambique rule to foreign copyright infringement claims is that which is used in the UK. The rule was restricted to land proceedings with the result that “all that is left of the Moçambique rule […] is that there is no jurisdiction in proceedings for infringement of rights in foreign land where proceedings are “principally concerned with a question of the title, or the right to possession, of that property’”27. A second argument against extension of the Moçambique rule to foreign copyright infringement claims is the Potter case. Here the Moçambique rule 19

Packard Instrument (n45 Chapter III) 409. On this case see supra, para 31. Vanity Fair (n 23 Chapter III) 527. On this case see supra para 31. 21 Ibid. 22 Ibid. 23 Full quotation of the relevant passages of this ruling is provided for at para 36 of this book. 24 See supra, para 16. 25 Baddeley (n 52 Chapter II) 36. See supra, para 16. See also Rotstein (n 1 Chapter I) 4-5. 26 See supra, para 36. 27 Lucasfilm Ltd & Ors v Ainsworth & Anor (n 30 Chapter I) 106. 20

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was only adopted as one of the elements in support of its conclusion, whereas “an examination of the way in which the case was argued, and of the reasoning of the High Court, shows that it is a decision extending the Act of State doctrine to foreign patents”28. Furthermore, “it is the Act of State doctrine, rather than the Moçambique rule, which is the essential foundation of the judgments in the High Court” in the Potter case29. However, as previously discussed the reasoning of the act of State doctrine is inapplicable to copyright30. A third argument against the extension of the Moçambique rule to foreign copyright infringement claims is that “there is no doubt that the modern trend is in favour of the enforcement of foreign intellectual property rights”31. Although the UK Supreme Court ruling in Lucasfilm and the New Zealand High Court judgement of KK Sony relate only to copyright infringement cases, their conclusions should be extended, mutatis mutandis, to all infringement and validity claims against both registered and unregistered IPRs validity for the reasons already referred to in Chapter II. The following additional arguments can also be invoked against the extension of the Moçambique rule to IPRs claims of whatever nature. The Moçambique rule is grounded on “archaic legal distinctions (based on local/transitory real property concepts) and [has] no modern relevance”32. For international jurisdiction purposes, there is no real analogy between land and intellectual property33. Furthermore, “even if you accept, for the sake of argument, that the two are analogous a court which says the two are analogous is doing something very different from actually classifying intellectual property rights as immovable”34. In fact, the underlying principles related to international jurisdiction are the same for matters of immovable properties as well as IPRs, which does not allow “an analysis based on an immovable characterization of intellectual property”35. Under the Brussels system an immovable 28

Ibid 62. Ibid 67. 30 See supra, chapter III. 31 Lucasfilm Ltd & Ors v Ainsworth & Anor (n 30 Chapter I) 109. See also supra, chapter II for the elements demonstrating the existence of the trend in question. 32 Daniel Seng, ‘Infringement of Intellectual Property Rights over the Internet – A Singapore Perspective’, presentation given at the AIPPI Forum (6 October 2007) page 6, available at accessed 30 November 2011. See also Rotstein (n 1 Chapter I) 4, according to whom the rule “presents an archaic view based on medieval conceptions in the present online environment”. 33 Fawcett and Torremans (n 51 Chapter I) 296. See also Heinze, ‘A Framework for International Enforcement’ (n 210 Chapter I) 54 criticising the approach under which “intellectual property, the most flexible and incorporeal form of property, has been treated essentially in the same manner as land, the most inflexible and corporeal form of property”. 34 Fawcett and Torremans (n 51 Chapter I) 297. 35 Ibid. 29

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classification is not adopted for purposes of international jurisdiction for IPRs36, and furthermore “in as far as subject matter jurisdiction is at issue there is simply no way it can find its way into the [Brussels I] Regulation; the Moçambique case is irrelevant on this point”37. There are strong principles and policy considerations which counsel against classifying IPRs as immovable property for jurisdictional purposes, since “the effect of an immovable classification would be to stultify the development of the law […] when what is needed is to introduce new flexibilities”38. Finally, even assuming in arguendo that an analogy between land and IP existed for jurisdictional purposes, the exercise of international jurisdiction over foreign IPRs would still not be justified by the Moçambique rule. This is based on general public international law where a State’s declination of jurisdiction under exclusive jurisdiction rules can imply a denial of justice and be contrary to the human right of access to a court39. This conclusion is confirmed by all four sets of Principles, none of which extends the Moçambique rule to IPRs claims with respect to infringement or validity claims, involving either registered or unregistered IPRs. 68. Double Actionability Rule According to the second alternative argument in support of exclusive jurisdiction rules, such rules are founded on the so-called double actionability rule that is rooted in the traditional conflicts of laws principles applicable in the Commonwealth Countries40. The double actionability rule is of English origin41 and posits that a foreign tort must satisfy two limbs to be actionable in a domestic court: first, the relevant act must be actionable as a tort according to the lex fori as if the act had been committed in the forum (limb 1); and second, the relevant act must be a wrongful act according to the lex loci delicti (limb 2). Exceptions to the rule are possible. For example, the 2007 Singapore Court of Appeal Rickshaw Investments ruling42 held the following: if the act and parties were closely and significantly connected to the forum, the Court would apply the lex fori. If the act, parties and other significant factors in the claim had either originated in the place where the act was committed, or 36 See Article 22(1) and respectively Article 22(4) of the Brussels I Regulation (n 84 Chapter I). 37 Torremans, ‘Lucasfilm v Ainsworth’ (n 29 Chapter I) 753. 38 Fawcett and Torremans (n 51 Chapter I) 296-297. 39 See infra, chapter VI. 40 See Austin, ‘Copyright Infringement’ (n 36 Chapter II) 4; Seng (n 33 Chapter V) 7; Austin, ‘The Concept of "Justiciability"’ (n 29 Chapter I) 397. 41 See the judgments Phillips v Eyre (1870) LR 6 QB 1 and Chaplin v Boys [1971] AC 354 (HL), on which see Austin, ‘Copyright Infringement’ (n 36 Chapter II) 4 and footnote 30. 42 Rickshaw Investments v Nicolai Baron von Uexkull [2006] SGCA 39.

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were connected with that jurisdiction, the Court would apply the lex loci delicti. But if the parties and other connecting factors were independent of the lex fori or the lex loci delicti, a third possible law might govern the action concerned43. This double actionability rule was extended to IPRs. The decision frequently cited for first applying the double actionability rule to copyright is the Def Lepp Music ruling44. In this case, notwithstanding that the plaintiff had characterised the defendant's unauthorised activities in Luxembourg and the Netherlands as infringements of the Copyright Act 1956 of the United Kingdom, the court adopted a territorial approach to choice of law. Accordingly, it was held that the defendant's activities in foreign territories were not infringements of British copyright law and thus not actionable as torts in the UK (limb 1). The Def Lepp decision was then applied in the foreign patent context by Laddie J in Coin Controls Ltd v Suzo International (UK) Ltd45. In this framework the double actionability rule is a significant barrier to cross-border enforcement of foreign IPRs. Such actions fall under limb 1 of the rule because national IPRs legislation defines an IPR infringement as an infringing act of a domestic IPR that is done in the country and the national law generally has no extra-territorial effect. Thus, infringement of a foreign IPR will rarely, if ever, constitute infringement under a nation’s domestic laws and therefore, under the double actionability rule, no action can be maintained. Foreign IPRs enforcement actions may also fall under limb 2 of the double actionability rule because a claim against a foreign IPR could be held non-actionable in place of infringement since the lex loci delicti’s IPR laws will also be territorial. In short, since the scope of an IPR is assumed to be territorially limited, infringements under a foreign law could never satisfy the double actionability rule. Yet, the argument for adopting the double actionability rule in IPRs crossborder litigation is unconvincing and should not be used to prevent courts from exercising jurisdiction over foreign IPRs for the following reasons. In England the double actionability rule was “abolished by statute”46 by the Private International Law (Miscellaneous) Provisions Act of 199547. The rule was then replaced by the Rome II Regulation on the law applicable to noncontractual obligations. With regard to copyrights in particular, the UK Court of Appeal’s Pearce ruling rejected the application of the double actionability 43

Seng (n 33 Chapter V) 7. See supra, previous para. 45 Coin Control (n 124 Chapter II). 46 See Austin, ‘Copyright Infringement’ (n 36 Chapter II) 4; Austin, ‘The Concept of "Justiciability"’ (n 29 Chapter I) 397. 47 See Austin, ‘Copyright Infringement’ (n 36 Chapter II) 4; Austin, ‘The Concept of “Justiciability”’ (n 29 Chapter I) 398. 44

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rule at common law for several reasons. Firstly, the Court of Appeal noted that the Def Lepp decision was confined to the extraterritorial application of domestic laws, rather than to the double actionability rule. Secondly, the Court of Appeal recalled the decision of the Privy Council in Red Sea Insurance Ltd v Bouygues SA. This decision acknowledged exceptions to the double actionability rule, and interpreted those exceptions as allowing plaintiffs to rely exclusively on the lex loci delicti in copyrights infringement actions. The Pearce ruling has since been confirmed by the UK Supreme Court in the Lucasfilm case, which held that “so far as English proceedings are concerned, [the double actionability rule] […] is no impediment to actions in England for infringement of foreign intellectual property rights”48. The same result was reached by the High Court of New Zealand in KK Sony ruling49, where MacKenzie J held that in a claim for infringement of United Kingdom and Hong Kong copyrights, the first limb of the double actionability rule was satisfied. Canada (1994) and Australia (2002) have also rejected the double actionability rule for all IPRs claims50. Finally, abolishment of the double actionability rule for all IPRs claims was proposed in 2003 by the Singapore Academy of Law51. In common law systems where the double actionability rule is still present, the rule should not influence international jurisdiction on foreign IPRs for the following reasons. In the first instance, it is “an archaic rule that doubts foreign law, and requires an assessment of the act as a tort both by the lex fori as well as the lex loci delicti, doubling the legal hurdle”52. Second, the double actionability rule in any case is not about jurisdiction, but rather choice of law53, and as such should not ground any exclusive jurisdiction rules. Third, even assuming in arguendo that the double actionability rule was about jurisdiction, it would still not impede the exercise of international jurisdiction over foreign IPRs since this would imply a denial of justice and would be contrary to the human right of access to a court54. Finally, the double actionability rule is not adopted in any of the 4 Principles with regard to either international jurisdiction or applicable law matters.

48 Lucasfilm Ltd & Ors v Ainsworth & Anor (n 30 Chapter I) 81. See also Austin, ‘The Concept of “Justiciability”’ (n 29 Chapter I) 397. 49 See supra, para 16. 50 Seng (n 33 Chapter V) 8. See also Baddeley (n 52 Chapter II) 43. 51 Seng (n 33 Chapter V) 8. 52 Ibid 8. 53 Fawcett and Torremans (n 51 Chapter I) 323. 54 See infra, chapter VI.

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69. Sound Administration of Justice and Judicial Economy The third alternative argument in support of exclusive jurisdiction rules holds that such rules promote the “sound administration of justice”55 and “judicial economy”56 in transnational IPRs cases. This argument was recently made by ECJ in the GAT case, which stated that the “sound administration of justice, [which] becomes all the more important in the field of patents since, given the specialised nature of this area, a number of Contracting States have set up a system of specific judicial protection, to ensure that these types of cases are dealt with by specialised courts”57. Furthermore, the US Court of Appeals for the Federal Circuit in the Voda case adopted the same argument and emphasised that “because of our lack of institutional competence in the foreign patent regimes at issue in this case, more judicial resources could be consumed by the district court than the courts of the foreign patent grants […] [namely] the Canadian, European, French, and German patent[s]”58. However, this argument is unpersuasive. As will be examined in chapter VI of this book, recent studies demonstrate that the sound administration of justice and judicial economy are achieved by consolidating multinational IPRs claims, rather than by multiplying the proceedings as required by the exclusive jurisdiction rules. Finally, as previously stated, such exclusive jurisdiction rules would still constitute a denial of justice and are contrary to the human right of access to a court59. 70. Best Placed Courts The fourth of the other arguments posits that exclusive jurisdiction rules determine the best placed courts to adjudicate transnational IPRs disputes. This argument was recently made by the ECJ in the GAT case, which stated that “the exclusive jurisdiction in proceedings concerned with the registration or validity of patents conferred upon the courts of the Contracting State in which the deposit or registration has been applied for or made is justified by the fact that those courts are best placed to adjudicate upon cases in which the dispute itself concerns the validity of the patent or the existence of the deposit or registration (Duijnstee, paragraph 22)”60. Yet, this argument is unconvincing61, at least with respect to exclusive jurisdiction rules, because the aim of the best placed court approach is to deter55

GAT v LuK (n 32 Chapter I) para 22. Voda (n 31 Chapter I) 898. 57 GAT v LuK (n 32 Chapter I) para 22. 58 Voda (n 31 Chapter I) 903. 59 See infra, chapter VI. 60 GAT v LuK (n 32 Chapter I) para 22. See Duijnstee (n 51 Chapter I) para 8. 61 For a critic to the best placed approach in favor of exclusive jurisdiction rules see also Chaen, Kono and Yokomizo (n 51 Chapter I) 87-88. 56

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mine the court that is more proximal to adjudicate the relevant case. This approach reflects the proximity principle, which demands that the best placed court should not be determined abstractly but rather by considering the concrete elements of the relevant cases on the basis of international jurisdiction rules that designate more than one competent court. Under the best placed court approach, the court seized must have discretionary powers to establish jurisdiction if it is the best placed to adjudicate the case according to its concrete elements62. Additionally, “although [in arguendo] correct in itself, [the argument of the best placed court] […] alone cannot justify exclusive jurisdiction that would, for example, preclude the international jurisdiction of the court of the country where the defendant is domiciled, [and that] […] would also prevent the validity of a right from being raised as an incidental issue, including as a defence to an infringement issue”63. In any case, as has already been mentioned, such exclusive jurisdiction rules in practice can violate fundamental human rights by denying access to a court even if the best placed court argument was convincing64. 71. Difficulties and Costs of Applying Foreign Laws According to the fifth alternative argument, exclusive jurisdiction rules are grounded on the need to avoid the application of foreign laws by the forum State court, since the difficulties and the costs of applying foreign IP laws, as well as “of obtaining and translating evidence, especially experts in foreign [IPRs] law”65, which are too great. For instance66, in Mars Inc. v. KabushikiKaisha Nippon Conlux, the US Court of Appeals for the Federal Circuit approved of the lower court’s refusal to exercise jurisdiction over Japanese patent infringement claims because adjudicating the “claim[s] would require the court to resolve complex issues of Japanese procedural and substantive law, a task further complicated by ‘having to agree on the proper translation of laws, documents and other communications’”67. Furthermore, in the Voda case, the Federal Circuit maintained that the exercise of jurisdiction over foreign IPRs would risk an unreasonable interference with the sovereign authority of other nations, since such sovereigns have “established specific judges, resources, and procedures” in light of the com-

62

See supra, chapter IV. Chaen, Kono and Yokomizo (n 51 Chapter I) 87-88. 64 See infra, chapter VI. 65 Voda (n 31 Chapter I) 904. See also Mars (n 56 Chapter III) 37. 66 See also Fairchild Semiconductor (n 49 Chapter III) 5 and London Film (n 46 Chapter III). See Wollman (n 46 Chapter III) 379; Dessemontet, ‘The ALI Principles’ (n 20 Chapter I) 37. 67 See also Mars (n 156 Chapter III) 28. 63

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plexities of the IPRs substantive laws68 and exercising jurisdiction over foreign IPRs claims could “disrupt their foreign procedures”69. Also, in ITSI T.V. Productions70, the US District Court for the Eastern District of California argued that “it appears to me that American courts should be reluctant to enter the bramble bush of ascertaining and applying foreign law without an urgent reason to do so”71. Yet, this argument is insufficient to justify exclusive jurisdiction rules. First, IPRs are not an expression of the sovereign authority of their granting states but rather are private rights72. Second, due to the extensive harmonisation of the procedural and substantive laws regarding IPRs, there is a recognisable similarity between the national IP laws of most States and therefore the forum State’s courts should be able to apply foreign IP laws with relative ease. For example, most examinations of patent validity involve investigations into novelty and the presence of an inventive step, novelty being the requirement that the “invention […] does not form part of the state of the art” (Article 54 ECP) and the existence of an inventive step when “an invention […] having regard to the state of the art […] is not obvious to a person skilled in the art” (Article 56 EPC)73. The individual national laws governing novelty and the requirement of an inventive step are highly harmonised throughout the world, and even though the tests that courts use to assess the inventive step can vary from country to country, the majority of national courts will be very experienced in dealing with the concepts at stake74. Third, most countries throughout the world have specialised courts with judges who can apply foreign IP laws with relative ease. This point was expressed in the US case Armstrong, which noted that “certain courts have, at times, demonstrated their reluctance to enter the bramble bush of ascertaining and applying foreign law without an urgent reason to do so”75. Despite such hesitation, the Court stated that “there is no principled reason to bar, in absolute fashion, copyright claims brought under foreign law for lack of subject matter jurisdiction. Not only is this Court called upon to enter bramble bushes, briar patches, and other thorny legal thickets on a routine basis, see, e.g., Briarpatch Ltd. v. Pate, 81 F.Supp.2d 509, 511 (S.D.N.Y.2000), but a number of persuasive authorities and commentators have also indicated that the exer68

Voda (n 31 Chapter I) 902-903. Namely, specific judges, resources, and procedures. 70 On this case see (n 183 Chapter III) and supra, para 38. 71 ITSI T.V. Productions (n 183 Chapter III) 866. 72 See supra, para 34. 73 On novelty and inventive step see supra, para 45. 74 Baddeley (n 52 Chapter II) 45. On the peculiarities of the US system with respect to the novelty requirement see supra, para 45. 75 Armstrong (n 185 Chapter III) 637. On this case see supra, para 38. 69

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cise of subject matter jurisdiction is appropriate in cases of transnational copyright infringement”76. Fourth, even in cases where national laws differ and complexity in the application of foreign IPRs law exists, this in no way distinguishes IPRs crossborder litigation from any other typical transnational proceeding, especially in fields that are largely unharmonised and where civilisation conflicts77 arise, such as family law matters. In those fields, the complexity of applying foreign laws does not impede the exercise of international jurisdiction by national courts but rather is dealt with by the (limited) recourse to the public policy exception. There is no justification for treating IPRs transnational claims any differently78. This is the conclusion that was reached by the UK Supreme Court in Lucasfilm, which held that “many of the points relied on by the Court of Appeal to justify the application of”79 exclusive jurisdiction rules “would apply to many international cases over which the English court would have jurisdiction and would in principle exercise it, especially the suggestion that questions of foreign law would have to be decided”80. The same conclusion was reached by the Australian High Court in Regie National des Usines Renault SA v Zhang81, which established that difficulties in applying foreign law will not lead to a declining of jurisdiction82. Finally, even assuming in arguendo that the complexity in the application of foreign IPRs law existed in IPRs cases and differed from the usual complexity in all transnational cases to be dealt with according to foreign law, the exercise of international jurisdiction over foreign IPRs could still violate the parties’ fundamental right of access to a court83. The same result is reached by all four sets of Principles, which do not consider the application of foreign laws to be an obstacle to the justiciability of foreign IPRs claims. 72. Recognition and Enforcement of Judgments on Foreign IPRs: Voluntary Compliance and Vicious Circle According to the sixth argument, exclusive jurisdiction rules can be grounded on the alleged impossibility of obtaining recognition and enforcement of foreign judgments on claims of registered and unregistered IPRs granted by

76

Ibid. See supra, para 40. 78 Ibid. 79 Lucasfilm Ltd & Ors v Ainsworth & Anor (n 30 Chapter I) 109. 80 Ibid. 81 Régie Nationale des Usines Renault SA v Zhang (2003) 210 CLR 491. 82 Baddeley (n 52 Chapter II) 45. 83 See infra, chapter VI. 77

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countries other than the rendering States84. Since allocation of jurisdiction is effective only when the decision rendered by the competent court is recognized and enforced in the requested State, the exercise of jurisdiction with respect to foreign IPRs would be ineffective, thereby justifying the existence of exclusive jurisdiction rules. The argument, that obtaining recognition and enforcement for foreign IPRs judgments is impossible, is grounded in an understanding that the territoriality principle prevents States from recognizing and enforcing judgements concerning IPRs unless rendered by the granting State. This argument is also grounded on the alleged existence of exclusive jurisdiction rules. Thus, the territoriality principle and exclusive jurisdiction rules are “decisive not only directly to allocate competence to the courts but also indirectly in the” recognition and enforcement of judgments stage “because […] their [alleged] mandatory character […] [could] lead to the non-recognition of a foreign judgment”85. In fact, one basis on which the requested State can condition the recognition and enforcement of foreign judgments is a finding that the court which rendered the decision ascertained its jurisdiction on the basis of international jurisdiction rules “similar” (under the standard of equivalence approach86) or “identical” (under the mirror-image approach87) to those existing in the requested country, including exclusive jurisdiction rules that exclude the court’s compe-

84 On this issue see the following recent decisions: Case C-38/98 Régie Nationales des Usines Renault SA v Maxicar SpA [2000] ECR I-1935; Sarl Louis Feraud International v Viewfinder, Inc. 406 F. Supp. 2d. 274, 281 (S.D.N.Y 2005); Pro Swing Inc. v Elta Golf Inc. [2006] 2 SCR 612, available at accessed 30 November 2011. On those decisions see Pertegás Sender, Cross-Border (n 130 Chapter IV) 197; Boschiero, ‘Beni immateriali’ (n 305 Chapter I) 115-185; Marketa Trimble Landova, ‘Public Policy Exception to Recognition and Enforcement of Judgments in cases of Copyright Infringement’ (2009) 40 IIC 654; de Miguel Asensio, ‘Recognition and Enforcement’ (n 210 Chapter I) 239; Kono, Tada and Shin (n 218 Chapter I) 293-340; Trimble Landova, ‘When Foreigners Infringe Patents’ (n 1 Chapter I) 499. See also Kono and Jurys (n 27 Chapter I) part IV; and all the national reports in Jurisdiction and applicable Law in Matters of Intellectual Property (n 27 Chapter I), including the following: Marie-Christine Janssens for Belgium, subsection I(II)(4); Joost Blom for Canada (including Quebec), subsection II(A)(iii); Ivana Kunda for Croatia, subsection I(D); Marie-Elodie Ancel for France, subsection I(iv); Axel Metzger for Germany, subsection I(1)(d)(1)-(3); Vandana Singh for India Subsection 2(2)(10); Nerina Boschiero and Benedetta Ubertazzi for Italy, subsection I(iv) and subsection II case 10; Dai Yokomizo for Japan, subsection 2(2)(10); Alexandre Dias Pereira for Portugal, subsection I(D); Damjan Možina for Slovenia, subsection II, case 10; Pedro de Miguel Asensio for Spain, subsection 2(3)(1)-(2). 85 De Miguel Asensio, ‘Recognition and Enforcement’ (n 210 Chapter I) 276, commenting on the CLIP Principles relevant rule. See the literature quoted at the previous footnote. 86 De Miguel Asensio, ‘Recognition and Enforcement’ (n 210 Chapter I) 253. 87 De Miguel Asensio, ‘Recognition and Enforcement’ (n 210 Chapter I) 253.

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tence to address foreign IPRs cases88. Under such an approach, the requested court would only recognize and enforce a foreign IPRs decision if it concerns the national IPRs of the state that rendered the decision, i.e. only if the decision was rendered on the basis of exclusive jurisdiction rules similar or identical to the ones existing in the requested state89. The requested state can also condition the recognition and enforcement of foreign judgments upon a finding that recognition or enforcement would not violate its public policy. In foreign IPRs cases, the public policy determination can include a consideration of the territoriality principle as an impediment to the adjudication of foreign IPRs issues. In other words, the requested court may only consider the foreign decision at stake to be compatible with its public policy, and consequently only recognizable and enforceable, if the decision concerns national IPRs of the state that rendered the decision, i.e. only if this decision was rendered on the basis of exclusive jurisdiction rules similar to the ones existing in the requested state90. This argument is unconvincing for a number of reasons. An initial reason is that “even if a judgment by a court of a country other than the country of registration is not recognized in other countries, it is possible that the parties will voluntarily comply with the judgment. This will occur particularly in case of jurisdiction by a choice-of-court agreement or agreed arbitration”91. A second reason is that this argument is based on a vicious cycle of selfperpetuating justifications that lack substance, with the impossibility of enforcing judgments serving as a justification for exclusive jurisdiction rules and exclusive jurisdiction rules conversely justifying the refusal to enforce

88 See also Article 35 of the Brussels I Regulation (n 84 Chapter I), according to which a judgment shall not be recognized if it conflicts with Section 6 of Chapter II, establishing the rules on exclusive jurisdiction. Before the ECJ GAT case, certain courts in Europe recognized and enforced foreign judgments dealing with IPRs infringement even when they dealt with validity issue incidentally raised before the court that rendered them. Hence according to Article 25 of the Brussels I Regulation “where a court of a Member State is seised of a claim which is principally concerned with a matter over which the courts of another Member State have exclusive jurisdiction by virtue of Article 22, it shall declare of its own motion that it has no jurisdiction”. The essential question was then to define when the court is seised of a claim which is principally concerned with a matter over which the courts of another Member State have exclusive jurisdiction. However, with the ECJ GAT judgment this approach can not be adopted anymore, and the judgments relating to a foreign IPRs validity issues only incidentally raised can not be recognized and enforced anymore according to the Brussels system. See Boschiero, ‘Beni immateriali’ (n 305 Chapter I) 115; de Miguel Asensio, ‘Recognition and Enforcement’ (n 210 Chapter I) 276. 89 Lucasfilm Entertainment (n 29 Chapter I). 90 See Trimble Landova, ‘Public Policy Exception’ (n 85 Chapter V) 642. See also Trimble Landova, ‘When Foreigners Infringe Patents’ (n 1 Chapter I) 508-509 as well as 505-506. 91 Chaen, Kono and Yokomizo (n 51 Chapter I) 86.

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judgments. The third and fourth reasons will be highlighted by the following two paragraphs. 73. Recognition and Enforcement of Judgments on Foreign IPRs: Public Policy Exception and International Mandatory Rules of the Country that Granted the Right A third argument against grounding exclusive jurisdiction rules on the alleged impossibility of obtaining recognition and enforcement of foreign judgments on national IPRs is that if this was true, the impossibility of enforcement would be grounded on exclusive jurisdiction rules and the territoriality principle and all the arguments previously made in this book against those rules and the territoriality principle are reasonably extendable to the issues of recognition and enforcement themselves. From this viewpoint, one can conclude therefore that States should recognize and enforce foreign decisions concerning IPRs as they would any other foreign judgment, even when the rendering court adjudicated claims relating to IPRs granted by another State (including the national IPRs of the requested State). Thus, the requested State should no longer refuse the recognition and enforcement of a foreign judgment based on the fact that the court that rendered the decision ascertained its jurisdiction by virtue of international jurisdiction rules that are not “similar” to those existing in the requested country with respect to exclusive jurisdiction rules. In fact, the untenable nature of these exclusive jurisdiction rules implies that such rules should no longer be present in the requested State in any case. Additionally, the requested state should no longer refuse the recognition and enforcement of foreign judgments on the basis that such an exercise of jurisdiction violates its public policy simply based on the argument that the territoriality principle prohibits the adjudication of foreign IPRs issues. In fact, the analysis of both the territoriality principle and exclusive jurisdiction rules in this book implies such principle and rules can no longer be considered an expression of a public policy principle that impedes the adjudication of foreign IPRs issues. This result is in line with the interpretation of the territoriality principle according to the proximity principle here proposed92. The above conclusion is supported by the view that the public policy exception should be adopted in a restrictive way in IPRs transnational litigation93. The public policy exception to the recognition and enforcement of for-

92

See supra, chapter IV. See Pertegás Sender, Cross-Border (n 130 Chapter IV) 197; Boschiero, ‘Beni immateriali’ (n 305 Chapter I) 115; Trimble Landova, ‘Public Policy Exception’ (n 85 Chapter V) 654; de Miguel Asensio, ‘Recognition and Enforcement’ (n 210 Chapter I) 239; Kono, Tada and Shin (n 218 Chapter I) 293; Trimble Landova, ‘When Foreigners Infringe Patents’ (n 1 Chapter I) 499. See also Kono and Jurys (n 27 Chapter I) part IV; and the national re93

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eign judgments includes both substantive and procedural public policy94. Although public policy is typically a national defence based on the basic values and fundamental principles of a national legal system, in the case of public policy as a ground for non-recognition, the doctrine is to be understood within the stricter sense of international public policy in both categories of substantive and procedural public policy. It should be applied in a restrictive and exceptional way; limited to situations in which the violation of public policy can be easily ascertained by the requested court; and the incompatibility with the public policy of the requested State must be manifest95. Usually the rules on public policy are general rules that do not specify the cases where this exception can be adopted to deny recognition and enforcement of foreign judgments. Yet, this specification is rendered by the literature and case law that is commenting and applying those rules. With respect to IP law, the literature and case law highlights that the important approximations of national substantive and procedural laws regarding the means of enforcing IPRs reduced the level of disparities between national legislations, particularly with respect to basic principles96. Furthermore, owing to the economic component of IP law civilisation conflicts are lacking in this field97. Therefore, the forum State court cannot adopt the public policy exception of a substantive nature to avoid the recognition and enforcement of a foreign judgment based on whatever differences there are in substantive laws, but rather in very limited cases where the differences reflect diverging options followed by the countries involved as to where to strike the balance ports on Jurisdiction and applicable Law in Matters of Intellectual Property (n 27 Chapter I). See footnote 1139 for the relevant sections of each national report. 94 See the literature just referred to and also Nerina Boschiero, ‘L’ordine pubblico processuale comunitario ed europeo’ in Patrizia De Cesari and Marco Frigessi di Rattalma (eds), La tutela transnazionale del credito (Torino, Giappichelli 2007) 193. As for the relevant caselaw, see the ECJ judgments: Case C-7/98 Dieter Krombach v André Bamberski [2000] ECR I-1935 para 37; Renault v Maxicar (n 85 Chapter V); and Case C-420/07 Meletis Apostolides v David Charles Orams and Linda Elizabeth Orams [2009] ECR I-3571 para 59. See ‘ALI/UNIDROIT Principles of Transnational Civil Procedure of 2004’ [2004-4] Uniform Law Review 758. Finally see Article 56-6 of the ‘Resolution on Le règlement « Bruxelles I » et les décisions judiciaires rendues dans des Etats non membres de l’Union européenne’ adopted by the European Group for Private International Law (GEDIP) at Copenhague (17 19 September 2010) available at accessed 30 November 2011. According to this rule “une décision n’est pas reconnue si la reconnaissance est manifestement incompatible avec l’ordre public substantiel ou procédural de l’Etat membre requis ou de l’Union européenne, en particulier si cette décision résulte d’un manquement aux principes qui régissent le droit au procès équitable ou résulte d’une fraude commise dans la procédure”. 95 De Miguel Asensio, ‘Recognition and Enforcement’ (n 210 Chapter I) 280. 96 See supra, para 40. See de Miguel Asensio, ‘Recognition and Enforcement’ (n 210 Chapter I) 281. 97 Ibid.

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between IPRs and other conflicting values, interests and even fundamental rights, such as the freedom of expression and information, the right of education and the protection of health care98. In this light, recourse to public policy can only be adopted to deny recognition and enforcement of foreign judgments in the following cases. First, where a foreign judgment on the scope of a national patent has strong consequences on the availability of products necessary to meet health and safety requirements, the requested State may choose to adopt the public policy exception to deny recognition of this type of judgment99. Second, the public policy exception may be adopted to exclude the recognition of a foreign judgment on the patentability of bio-technological inventions that can be interpreted in the requested State as against human dignity100. Third, the public policy exception could be adopted to deny recognition to foreign judgments that disregard the moral rights of authors101. Fourth, recognition of foreign judgments can be denied when it is determined that the foreign court admitted evidence accessed through certain mechanisms used to fight allegedly infringing activities on the Internet, but obtained in a way that failed to respect the fundamental right to private life and data protection of the accused infringer102. Fifth, 98

De Miguel Asensio, ‘Recognition and Enforcement’ (n 210 Chapter I) 282. On the balance between IPRs and other fundamental human rights see supra, para 12. 99 De Miguel Asensio, ‘Recognition and Enforcement’ (n 210 Chapter I) 282. See also Article 27(2) TRIPs Agreement (n 8 Chapter I) permitting a State to exclude otherwise patentable subject matter from the scope of protection when: necessary to protect ordre public or morality, including to protect human, animal or plant life or health or to avoid serious prejudice to the environment. Similarly, Article 31(b) of the TRIPS Agreement contemplates that efforts to obtain authorization for certain usages can be waived in the case of “national emergenc[ies]” or “extreme urgency”. See the ALI Principles (n 58 Chapter I) 286. 100 De Miguel Asensio, ‘Recognition and Enforcement’ (n 210 Chapter I) 282. See the ECJ judgment in Case C-34/10 Oliver Brüstle v Greenpeace eV [2011], according to which “the exclusion from patentability concerning the use of human embryos for industrial or commercial purposes set out in Article 6(2)(c) of Directive 98/44 also covers the use of human embryos for purposes of scientific research, only use for therapeutic or diagnostic purposes which are applied to the human embryo and are useful to it being patentable”, as per conclusion number 2. 101 See Moura Vicente (n 209 Chapter I) 422; de Miguel Asensio, ‘Recognition and Enforcement’ (n 210 Chapter I) 282. 102 See de Miguel Asensio, ‘Recognition and Enforcement’ (n 210 Chapter I) 282. See the Reference for a preliminary ruling from the Cour d'appel de Bruxelles (Belgium) lodged on 5 February 2010, Case C-70/10 Scarlet Extended SA v Société Belge des auteurs, compositeurs et éditeurs (SABAM) [2010] OJ C113/30, which posed the following questions to the ECJ: “Do Directives 2001/29 and 2004/48, in conjunction with Directives 95/46, 2000/31 and 2002/58, construed in particular in the light of Articles 8 and 10 of the European Convention on the Protection of Human Rights and Fundamental Freedoms, permit Member States to authorise a national court, before which substantive proceedings have been brought and on the basis merely of a statutory provision stating that: 'They [the national courts] may also issue an

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recourse to procedural public policy can be made to refuse recognition and enforcement of foreign judgments when the foreign judgment was adopted without respecting the right of the parties to substantiate their claims and to present all relevant evidence, for instance, as a consequence of a fraudulent behaviour103. Sixth, the public policy exception can be adopted as a basis for refusing to recognise or enforce a foreign judgment rendered on the basis of a procedure contrary to the right to a fair trial posed by Article 6 ECHR, as the ECtHR maintained on several occasions104 and the ECJ confirmed by interpreting the public policy exception of Article 34(1) of the Brussels I Regulation in light of the ECtHR jurisprudence on Article 6 ECHR105. Seventh, the injunction against intermediaries whose services are used by a third party to infringe a copyright or related right', to order an Internet Service Provider (ISP) to introduce, for all its customers, in abstracto and as a preventive measure, exclusively at the cost of that ISP and for an unlimited period, a system for filtering all electronic communications, both incoming and outgoing, passing via its services, in particular those involving the use of peer-to-peer software, in order to identify on its network the sharing of electronic files containing a musical, cinematographic or audio-visual work in respect of which the applicant claims to hold rights, and subsequently to block the transfer of such files, either at the point at which they are requested or at which they are sent? If the answer to the question in paragraph 1 is in the affirmative, do those directives require a national court, called upon to give a ruling on an application for an injunction against an intermediary whose services are used by a third party to infringe a copyright, to apply the principle of proportionality when deciding on the effectiveness and dissuasive effect of the measure sought?”. 103 De Miguel Asensio, ‘Recognition and Enforcement’ (n 210 Chapter I) 292. 104 See Pellegrini v Italy no 30882/96 (ECtHR, 20 July 2001) para 40; Maumousseau et Washington v France no 39388/05 (ECtHR, 6 December 2007) para 96; Saccoccia v Austria no 69917/01 (ECtHR, 18 December 2008) para 62; and McDonald v France no 18648/04 (ECtHR, 29 April 2008). In literature see Fawcett, ‘The Impact of Article 6(1)’ (n 45 Chapter I) 44; Hélène Gaudemet-Tallon, Compétence et exécution des jugements en Europe (4th edn, LGDJ 2010) 73; Antonella Cafagna, ‘L’art. 6 della Convenzione europea dei diritti dell’uomo e la circolazione delle decisioni: il giudizio civile contumaciale’ in Gabriella Carella (ed), La convenzione europea dei diritti dell’uomo e il diritto internazionale privato (Torino, Giappichelli 2009) 17. See also Carlo Focarelli, ‘Equo processo e riconoscimento di sentenze straniere: il caso Pellegrini’ [2001] RDI 955; Adrian Briggs, ‘Recognising Foreign Judgments which Violate Human Rights: Governments of the United States of America v. Montgomery (No. 2)’ [2004] Brit. Y.B. Int’l L. 537; Patrick Kinsch, ‘The Impact of Human Rights on the Application of Foreign Law and on the Recognition of Foreign Judgments – A Survey of the Cases Decided by the European Human Rights Institutions’ in Einhorn and Siehr (n 196 Chapter III) 197; Boschiero, ‘L’ordine pubblico’ (n 95 Chapter V) 193; Patrick Kinsch, ‘Commentary to the ECtHR’s judgment McDonald v. France decision of 29 April 2008, Application no. 18648/04’ [2008] RCDIP 838; Pasquale Pirrone, ‘La Corte europea dei diritti umani torna ad occuparsi di riconoscimento di decisioni giudiziarie straniere’ [2010] Diritti umani e diritto internazionale 396; de Miguel Asensio, ‘Recognition and Enforcement’ (n 210 Chapter I) 286; Olivia Lopes Pegna, ‘L’incidenza dell’art. 6 della Convenzione europea dei diritti dell’uomo rispetto all’esecuzione di decisioni straniere’ [2011] RDI 33. 105 ECJ Judgments of Krombach (n 95 Chapter V) paras 38-39; Case C-341/04 Eurofood IFSC Ltd [2006] ECR I-3854 para 65; and Case C-394/07 Marco Gambazzi v DaimlerChrys-

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public policy exception can be adopted where a foreign court ruled on an invention that employed extremely advanced technology without the aid of specialists with sufficient knowledge to understand the content of the invention106. In contrast, a civil judgment based on a jury verdict, in principal, should not be regarded as contrary to public policy in countries that do not use civil juries. Also, differences with respect to the availability of discovery devices between the country of origin and the requested country should not be an obstacle to the enforcement of the judgment107. Apart from the exceptional situations just mentioned in which the different standards applied by the foreign court determine that the fundamental principles of the State of recognition are openly disregarded, public policy is a last resort mechanism. Therefore, even when the public policy exception can, in principle, be adopted to deny recognition and enforcement of foreign judgments, it should be limited in the following two ways. First, “the enforcement court should consider only the outcome of litigation, not the substance or procedure by which the outcome was achieved. Second, the court should consider how the outcome affects interests in the forum State and whether any clash with local interests can be softened through the remedial procedures” approach that “allow[s] the enforcement court to tailor the remedy to local concerns”108 rather than to deny recognition and enforcement of the foreign judgment in question. “In fact, the remedial approach is particularly appropriate in an international setting, where cultural differences and levels of technological development are so widely disparate”109. The exceptional nature of public policy with regard to the recognition and enforcement of foreign judgments is confirmed also by recent case law originating in various countries of the world. In the US, in the Sarl Louis Feraud International v Viewfinder, Inc. judgment110, the US Court of Appeals for the Second Circuit had to determine the enforceability of a French judgment that found a copyright infringement in France under French law on a subject matter that was not copyrightable in the US. The question before the Court was whether the fact that the object of the infringement is not copyrightable in the US made the foreign judgment contrary to US public policy. In answer to this question, the US Court of Appeals for the Federal Circuit supported the view of the district court that copyright are not matters of “strong moral princiler Canada Inc. [2009] ECR I-2563 para 28. On those cases see de Miguel Asensio, ‘Recognition and Enforcement’ (n 210 Chapter I) 287. 106 Kono, Tada and Shin (n 218 Chapter I) 325. 107 De Miguel Asensio, ‘Recognition and Enforcement’ (n 210 Chapter I) 288. 108 The ALI Principles (n 58 Chapter I) 277. 109 Ibid 285. 110 Sarl Louis Feraud (n 85 Chapter V).

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ple”111 but rather represent “economic legislation based on policy decisions that assign rights based on assessments of what legal rules will produce the greatest economic good for society as a whole”112, concluding that “the fact that the foreign judgment found copyright infringement under foreign law on a subject matter that is not copyrightable in the US does not make the foreign judgment contrary to public policy”113. In the EU, in the Renault v Maxicar case114, Renault sought to enforce a French judgment in Italy, in which the defendant was found guilty of forgery for having manufactured and marketed body parts for Renault vehicles. The Italian First Instance Court dismissed the application on the ground that the French judgment could not be declared enforceable in Italy because it was contrary to public policy in economic matters. The Court of Appeal of Torino then decided to stay proceedings and refer the following question to the ECJ for a preliminary ruling: “is a judgment handed down by a court of a Member State to be considered contrary to public policy within the meaning of Article 27 of the Brussels Convention if it recognises industrial or intellectual property rights over such component parts which together make up the bodywork of a car, and affords protection to the holder of such purported exclusive rights by preventing third parties trading in another Member State from manufacturing, selling, transporting, importing or exporting in that Member State such component parts which together make up the bodywork of a car already on the market, or, in any event, by sanctioning such conduct?‘”115. The ECJ answered in the following terms. First the ECJ highlighted that “recourse to the clause on public policy in Article 27, point 1, of the Convention can be envisaged only where recognition or enforcement of the judgment delivered in another Contracting State would be at variance to an unacceptable degree with the legal order of the State in which enforcement is sought inasmuch as it infringes a fundamental principle”116. Second, the ECJ recalled that “the court of the State in which enforcement was sought is in doubt as to the compatibility with the principles of free movement of goods and freedom of competition of recognition by the court of the State of origin of the existence of an intellectual property right in body parts for cars enabling the holder to prohibit traders in another Contracting State from manufacturing, selling, transporting, importing or exporting such body parts in that Contracting State”117. Third, 111

Sarl Louis Feraud (n 85 Chapter V) 281. On this case see de Miguel Asensio, ‘Recognition and Enforcement’ (n 210 Chapter I) 282. 112 Ibid. 113 Ibid. 114 Renault v Maxicar (n 85 Chapter V). On this case see de Miguel Asensio, ‘Recognition and Enforcement’ (n 210 Chapter I) 282. 115 Renault v Maxicar (n 85 Chapter V) para 15. 116 Ibid para 30. 117 Ibid para 31.

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the ECJ emphasised that “the court of the State in which enforcement is sought cannot, without undermining the aim of the Convention, refuse recognition of a decision emanating from another Contracting State solely on the ground that it considers that national or Community law was misapplied in that decision”118. Finally, the ECJ concluded that “Article 27, point 1, of the [Brussels] Convention, [now 34 point 1 of the Brussels I Regulation], […] must be interpreted as meaning that a judgment of a court or tribunal of a Contracting State recognising the existence of an intellectual property right in body parts for cars, and conferring on the holder of that right protection by enabling him to prevent third parties trading in another Contracting State from manufacturing, selling, transporting, importing or exporting in that Contracting State such body parts, cannot be considered to be contrary to public policy”119. With regard to the argument that exclusive jurisdiction rules do not constitute a principle of public policy that can serve as a basis for refusing to enforce foreign IPRs judgments, the following remarks can be added. According to one view, “contrariety to public policy may come into question when the validity or scope of a IP right on which a foreign judgment is granted is discrepant with that in the granting country”120. Yet, the same view limits the possibility of adopting the public policy exception to deny recognition and enforcement of a foreign judgment as a means to safeguard the exclusive jurisdiction rules of the granting State in cases of the discrepancy in question, by highlighting that “non recognition of the foreign judgment should not always be expected despite the fact that the status of IP rights in the granting country is now different due to the changes that arose after the termination of the foreign proceedings”121. The above limitation of the public policy exception should be favoured and extended to all cases where the refusal to recognise and enforce a foreign judgment is grounded on the purpose of safeguarding the exclusive jurisdiction rules of the requested State. In fact, as will be explained by the following remarks, exclusive jurisdiction rules are contrary to the human right of access to a court and therefore must be overruled, not safeguarded, by the requested State122. This conclusion finds support in the Transparency Proposal, First, the Proposal implicitly rejects the safeguarding of exclusive jurisdiction rules as a grounding basis for a public policy exception, as it is not included in the list of cases, provided for by the comments to the same Proposal, where the pub118

Ibid para 33. Ibid, conclusions. 120 Kono, Tada and Shin (n 218 Chapter I) 322. 121 Kono, Tada and Shin (n 218 Chapter I) 323. 122 See chapter VI. 119

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lic policy exception can be adopted to refuse to recognize or enforce a foreign judgment. Second, while this proposal acknowledges the possibility to adopt the public policy exception for non-enforcement of a judgment that was based on the (in)validity or the scope of an IPR that is discrepant with that in the granting country, it grounds this possibility not on the need to safeguard exclusive jurisdiction rules but rather on the fact that the foreign judgment at stake is based on a mistaken factual premise related to the validity of the IPR involved123. Finally, the conclusion here purported is supported by the approach that the fundamental human right of access to courts is also infringed when the requested state unlawfully refuses to recognize and enforce a foreign judgment rendered by a competent court and recognizable according to its PIL rules124. The conclusion that the public policy exception shall not be applied to deny recognition and enforcement of a foreign judgment merely to safeguard the exclusive jurisdiction rules does not prevent the possible adoption of the public policy exception to refuse to recognize and enforce a foreign judgment in cases where the judgment is based on the validity or scope of an IPR that is inconsistent with a holding by a court in the granting country. It also does not prevent non-enforcement in cases where the judgment at stake did not apply certain provisions of the granting State, other than its exclusive jurisdiction rules. In the first case, the public policy exception can be adopted as a ground to deny recognition and enforcement of the foreign judgment because the judgment of the rendered court was based on a false factual premise related to the 123

Kono, Tada and Shin (n 218 Chapter I) 320. See the following remarks also. See Gaudemet-Tallon (n 105 Chapter V); Pirrone (n 105 Chapter V) 396. See also Lopes Pegna (n 105 Chapter V) 5 and 6, commenting on the ECtHR’s judgment Vrbica v Croatia no 32540/05 (ECtHR, 1 April 2010). According to a different opinion - yet more favourable to the enforcement of foreign judgments - the right to a fair trial would encompass the right to enforce foreign judgments always, and therefore independently from their being adopted by the competent court and thus recognisable according to the PIL rules of the requested State. See Kinsch, ‘Commentary’ (n 105 Chapter V) 838, as well as Judge Spielmann concurring opinion to the case Vribica v Croazia (n 125 Chapter V) para 6. On this topic in general see also Briggs (n 105 Chapter V) 537; Fawcett, ‘The Impact of Article 6(1)’ (n 45 Chapter I) 22; Kinsch, ‘Commentary’ (n 105 Chapter V) 838; Kinsch, ‘The Impact of Human Rights’ (n 105 Chapter V) 197; Focarelli (n 105 Chapter V) 955; Pirrone (n 105 Chapter V) 396; Boschiero, ‘L’ordine pubblico’ (n 95 Chapter V) 193. A different issue is that the right to a fair trial under Article 6(1) ECHR (on which see extensively chapter four of this book) demands a review that the proceeding before the foreign court that rendered the judgment which is to be recognised fulfilled the guarantees of Article 6, so that the court of the requested State shall verify the lawfulness of the procedure followed before the foreign courts from the standpoint of Article 6 ECHR. This issue relates to procedural public policy. On this issue see de Miguel Asensio, ‘Recognition and Enforcement’ (n 210 Chapter I) 289; Lopes Pegna (n 105 Chapter V) 1-4 and there for further references. 124

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validity of the IPR at stake, as the Transparency Proposal maintains. Yet, as will be examined in the following paragraph, recourse to the public policy exception should be limited in cases of res judicata. In the second case, the recourse to public policy can be grounded on the nature of the rules of the granting State that have not been applied regulating “matters such as the filing of application, registration, or cancellation of registration” of IPRs125; “initial ownership for a right to obtain a patent”; “the existence, validity and initial ownership of a non-registered right, and matters such as the protection period, effect (scope of protection, etc.) and transferability of both registered rights and non-registered rights”126. In fact, “it seems to be unarguable that, for instance, grounds for the invalidation of patents should be governed only by the law of the registered country. In other words, these provisions are a sort of internationally mandatory rules, the application of which is always to be ensured”, and “application of such rules […] come into question under the Transparency Proposal because it does not provide for exclusive jurisdiction for the actions concerning the validity of registered IPRs (see Article 103 and the Comments) and, as a result, even a foreign judgment determining the validity of patents of Japan or of a third country may be recognised and enforced in Japan. It cannot be accepted that those matters may not be governed by the law other than that of the registered country, even if the effect of a foreign judgment pertaining to the invalidity of a registered right is limited to having an inter partes effect as set forth in Articles 103(3) and 404(2)”127. This approach is then in line with the opinion that the overcoming of exclusive jurisdiction rules requires verification by the requested State of the law applied by the court that rendered the judgment to be recognised and enforced128. In any case, recourse to the public policy exception to refuse to recognize and enforce a foreign judgment with the aim of safeguarding the internationally mandatory rules of the granting State shall be excluded in the following cases. First, when the foreign court did not apply the granting State’s rules on remedies for infringement of IPRs or IPRs contracts, since those provisions cannot be characterised as internationally mandatory rules. Second, when the foreign court failed to apply the granting State’s rules in case of IPRs ubiquitous infringements, since “it cannot be supposed that the law of the granting country should always be applied in such a case”129. Finally, under the principle of no review on the merits of foreign judgments in the recognition and enforcement stage, which is generally accepted around the world, the appropri125

Kono, Tada and Shin (n 218 Chapter I) 320. Ibid. 127 Ibid. 128 Pataut (n 217 Chapter IV) para 665. See also para 60. 129 Kono, Tada and Shin (n 218 Chapter I) 320. 126

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ateness of the interpretation and the application of the relevant rules of the granting State by the foreign court cannot be questioned in principle and consequently the requested court cannot refuse to recognise and enforce a foreign judgment in cases of misappropriation and misapplication of the granting State’s provisions. Similarly, from a judicial economy perspective the requested court cannot refuse to recognise and enforce a foreign judgment when the application of the relevant provision of a State other than the granting State, instead of the mandatory rules of this latter State “does not affect the conclusion of the judgment”130. With particular regard to the contention that the territoriality principle is not an expression of a principle of public policy allowing for non-recognition of judgments, all the arguments examined in chapter IV against the interpretation of the territoriality principle as an implicit PIL rule grounding the exclusive jurisdiction of the IPR granting States can be adopted, mutatis mutandis, against the interpretation of this same principle as an implicit PIL rule grounding the impossibility of recognising and enforcing foreign judgments rendered by States other than the IPRs granting country131. This conclusion is supported by the Transparency Proposal, that explicitly declines the possibility of invoking the territoriality principle in the cases where the public policy exception can be adopted to deny recognition and enforcement of the said foreign judgment132. The same conclusion is also supported by the ALI Principles in that even though they allow the public policy exception to be adopted to deny recognition and enforcement of a foreign judgment they allow such adoption not in favour of exclusive jurisdiction rules133, but with respect to other cases. In fact, the ALI Principles allow for the adoption of the public policy exception to deny recognition and enforcement of foreign judgments in the name of the territoriality principle when the rendered court applied national laws or laws other than the lex loci protectionis in an illegal extraterritorial way, or awarded damages “deleteriously impact[ing] local interests”134. Interestingly enough, the Transparency Proposal explicitly declines even this possible adoption of the public policy exception in relation to the recognition and enforcement of foreign judgments issues, in light of the fact that it should not take “such a strict meaning of the principle of territoriality”135, accepting derogations to this principle at some occasions. 130

Ibid 322. See supra, paras 50-58. 132 See the immediately preceding remarks. 133 Note that the ALI Principles abandon exclusive jurisdiction rules even for registered IPRs validity issues principally raised, under certain requirements, see chapter II. 134 The ALI Principles (n 58 Chapter I) 277. 135 Kono, Tada and Shin (n 218 Chapter I) 324. 131

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74. Recognition and Enforcement of Judgments on Foreign IPRs: already Existing Rules and Tendency in Favor of Recognition and Enforcement, Issue Preclusion and Res Judicata A fourth reason against the alternative argument that exclusive jurisdiction rules are grounded on the alleged impossibility of recognizing and enforcing foreign IPRs judgments is that various rules of the different legal systems of the world already allow the recognition and enforcement of those judgments to foster effective cross-border litigation. Particularly, the courts must recognize and enforce not only foreign decisions over disputes in which the infringement of foreign IPRs is addressed, but also cases where their validity is adjudicated, regardless of whether the validity claim is principally or incidentally raised. However, the effects of the recognition and enforcement of the decisions on validity should be limited to the parties of the proceeding. At the international and universal level, rules impeding recognition and enforcement of foreign judgments dealing with issues related to IPRs granted by countries other than the State of the rendering court are absent. In contrast, The Hague Convention on Choice of Court Agreements provides an important example of an international convention explicitly allowing for recognition and enforcement of judgments that contain an incidental ruling on the validity of IPRs. Thus, although Article 2(2) leaves the validity and infringement of IPRs other than copyright and related rights outside the scope of application of the Convention, save where infringement proceedings are brought for breach of a contract between the parties relating to such rights, the Convention allows in Article 10(3) for the recognition and enforcement of judgments in which the validity of IPRs arises as a preliminary question in infringement proceedings for breach of a contract including a choice of court agreement136. In the EU/EFTA framework, Article 35 of the Brussels system establishes that a judgment shall not be recognised if it conflicts with Section 6 of Chapter II, which establishes the exclusive jurisdiction rule concerning foreign IPRs validity issues principally and incidentally raised. However, foreign judgments on IPRs claims that do not fall in the exclusive jurisdiction rules shall be recognised and enforced by the requested EU Member State, namely decisions concerning infringement of foreign IPRs, both unregistered and those subject to registration, as well as decisions concerning the validity of foreign unregistered IPRs. In addition, although exclusive jurisdiction rules exist with respect to foreign registered IPRs validity claims even incidentally raised, judgments on those claims are already being recognised and enforced,

136

See supra, para 16.

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at least when a non-validity challenge is not pending before the court of the enforcing country137. At the national level, while certain rules refuse recognition and enforcement of foreign judgments that adjudicated the validity of registered IPRs of the requested State138, those rules do not impede recognition and enforcement when the judgments in question relate to unregistered IPRs validity and infringement issues, or in the case of registered IPRs infringement claims and validity issues incidentally raised. In addition, certain national systems go even further and establish that foreign infringement and validity decisions on IPRs of the requested State that have been recognised and enforced in the requested State and that have become res judicata are typically not affected by a subsequent declaration of invalidity by a requested State to the extent the judgments at stake have been enforced prior to the requested State’s declaration of invalidity139. Other legal systems are even more advanced. For example, in Japan, it seems to be possible to recognise and enforce a foreign judgment on a Japanese IPR infringement claim or on the incidental validity of this right, 137

See the references in de Miguel Asensio, ‘Recognition and Enforcement’ (n 210). It is also to be noted the understanding of the Brussels system that the foreign judgment on validity of an IPR given by the court at the place of registration having an exclusive jurisdiction on this issue cannot be recognised if in the requested State was already rendered another judgment or was already recognised another judgment given by a third State on the infringement of the same IPR, even though this last judgment had adjudicated also the validity issue incidentally raised, if the two judgments lead to irreconcilable results. This understanding acknowledges the vulnus to exclusive jurisdiction rules of the Brussels system as interpreted by the ECJ in GAT that derives from the preference given to the latter judgment on the former. To overcome this vulnus, then, the interpretation at stake purports to apply the Brussels system under the presumption that the court that rendered the infringement judgment which excludes the recognition of the validity judgment did not adjudicate on the validity incidentally raised in conformity with the GAT judgment. So interpreted in fact the two judgments would not lead to different results and therefore the judgment on validity could be recognised even if contrary to the judgment on the infringement which is presumed not to have entered into the validity issue. See Honorati C., ‘Il riconoscimento delle decisioni in materia di proprietà intellettuale’ in Giussani (Ed.) ‘Processo industriale’ forthcoming with Giuffrè (2012) para 3. It is to be noted that the same understanding that a judgment on validity is not irreconcilable to a judgment on infringement that adjudicated the validity incidentally differently than the judgment on the validity issue principally raised is adopted for instance with respect to purely internal cases in the Italian system by the Supreme Court (n.24859/2006). 138 As illustrated by Article 111(2) of the Swiss Federal Act of Private International Law of 1987, Article 95 Belgian Code of Private International Law of 2004. 139 By contrast, “other countries are more favorable to the possibility of a retrial of a previous infringement dispute based on the later invalidation of the relevant patent, and consider that the retroactive effect of a revocation or a decision on invalidity allows for a reopening of past infringement proceedings”, see Christopher Heath, ‘Wrongful Patent Enforcement – Threats and Post-Infringement Invalidity in Comparative Perspective’ (2008) 39(3) IIC 307323, 316.

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even if the status of the Japanese IPR in question is now different than it was at the time the foreign judgment was rendered, if the change in status arose after the termination of the foreign proceedings140. Certain legal systems go even further and allow national courts not only to recognise and enforce foreign judgments on national IPRs claims, but also to adopt those judgments to preclude litigation in the forum State concerning national parallel IPRs cases. Among those systems is the US system, where courts have already applied in several cases the doctrines of res judicata and collateral estoppel to use foreign judgments related to foreign IPRs claims to preclude litigation in the US concerning national parallel IPRs cases on the corresponding relevant issues. Those cases enable the conclusion that “US courts have doctrinal authority to apply the doctrines of res judicata and collateral estoppel to prevent parties from making their transnational intellectual property disputes ‘a war of attrition’. To date, they have shown some willingness to apply collateral estoppel”141. It is evident that certain US decisions have rejected attempts to rely on foreign judgments concerning foreign IPRs to preclude litigation in US courts on the same issues of corresponding US IPR, considering that the foreign judgments in question do not present the same issues as US IPR disputes142. However, “none of the[se] decisions foreclose courts from exercising this option”143. Finally, all sets of Principles favour the recognition and enforcement of foreign judgments on disputes in which not only the infringement of rights registered in countries other than the adjudicating country is addressed, but also their validity or registration is raised incidentally and sometimes even principally, limiting however the effects of the recognition and enforcement of the decisions on validity to the parties of the proceeding. Since these four sets of Principles constitute the more recent expression of the developments related to IPRs cross-border litigation, it seems important to examine their relevant rules in depth. As for the ALI Principles, according to Section 413 on “Declarations of Validity, Invalidity, Infringement, and Ownership of Rights”, “(1) Except as 140

See Heath (ibid) 318; Kono, Tada and Shin (n 218 Chapter I) 323. Nicolas, ‘The Use of Preclusion Doctrine’ (n 2 Chapter III) 374, quoting relevant US judgments on the point among which is the case Vas-Cath Inc. Mahurkar 745 F. Supp. 517, 525 (N.D. Ill. 1990). The para of this judgment recalling the rationale for applying collateral estoppel warrants full quotation: “conservation of resources is the principal objective of the law of preclusion, and that is a vital objective when costs are high, the more so when similar patents have been secured in many of the industrial countries. Patent litigation should not be allowed to become a war of attrition, in which after the conclusion of one battle parties move on to another and duplicate the engagement” (ibid 525). 142 See the references to those cases in Nicolas, ‘The Use of Preclusion Doctrine’ (n 2 Chapter III) 374 and 365. 143 See Nicolas, ‘The Use of Preclusion Doctrine’ (n 2 Chapter III) 374. 141

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provided in subsection (2), declarations by a foreign court of validity, invalidity, infringement, or ownership of intellectual property rights must be recognized and enforced by the enforcement court. (2) If a court in one State declares that a right registered in another State is invalid, the declaration is enforceable only between or among the parties to the litigation”. The limited scope of exclusive jurisdiction rules under the ALI Principles, therefore, plays an important role also at the recognition and enforcement stage, allowing for instance the recognition and enforcement of foreign judgments on infringement matters, including validity issues incidentally raised, in respect of registered IPRs of the requested country or of third States. Furthermore, since the exclusive jurisdiction rules of the ALI Principles do not cover validity issues of foreign registered IPRs principally raised (under certain requirements), Section 413(1) does not preclude the recognition and enforcement of foreign judgments rendered on those issues by courts sitting in a State other than the granting country. Yet, according to Section 413(2) the decision resulting from a dispute related to a foreign registered IPR validity claim, principally or incidentally raised, is enforceable only between or among the parties to the litigation, thus having no binding effect beyond the proceeding concerned144. As for the CLIP Principles the following can be said. According to Article 4:202 on “validity and registration”, “recognition and enforcement of a foreign judgment may not be refused on the ground that in the proceedings before the court of origin the validity or registration of an intellectual property right registered in a State other than the State of origin was challenged, provided that the recognition and enforcement produces effects concerning validity or registration only with regard to the dispute between the parties”. The limited scope of exclusive jurisdiction rules under the CLIP Principles, therefore, plays an important role also at the recognition and enforcement stage, allowing for opportunities to recognise and enforce foreign judgments on infringement matters and validity issues incidentally raised for registered IPRs of the requested country or of third States. But, according to Article 2:401(2) the decision resulting from a dispute over the incidental validity of foreign IPRs does not affect the validity or registration of those rights as against third parties, or as against the same parties to the dispute in question in subsequent proceedings. Thus, the decision in question has no binding effect beyond the proceeding concerned145. As for the Transparency Proposal the following can be said. According to Article 404(2) of the Transparency Proposal on the “Effect of Judgments and Provisional Measures of Foreign Courts to Be Recognized or Enforced”, “if a judgment of a foreign court declares the invalidity of a right registered in a 144 The ALI Principles (n 58 Chapter I) 299; Kono, Tada and Shin (n 218 Chapter I) 339 footnote 134. 145 De Miguel Asensio, ‘Recognition and Enforcement’ (n 210 Chapter I) 276.

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country other than the country where the foreign court is situated, the declaration shall be effective only to resolve the dispute between the parties to the litigation”. The absence of exclusive jurisdiction rules under the Transparency Proposal, therefore, plays an important role also at the recognition and enforcement stage. This allows i.a. the possibility of recognising and enforcing foreign judgments on infringement matters and validity issues incidentally raised for registered IPRs of the requested country or of third States. Furthermore, since the Transparency Proposal does not encompass any exclusive jurisdiction rule, not even on the IPRs validity issues principally raised, Article 402(i) does not preclude the recognition and enforcement of foreign judgments rendered on those issues by courts sitting in a State other than the granting country. Yet, according to Article 404(2) the decision resulting from a dispute related to a foreign registered IPR validity claim, principally or incidentally raised, is enforceable only between or among the parties to the litigation, thus having no binding effect beyond the proceeding concerned146. As for the Waseda Proposal the following can be said. According to Article 404 of the Waseda Proposal on “foreign judgments invalidating intellectual property rights registered in another state”, “a foreign judgment invalidating intellectual property rights registered in another state may be recognized or enforced only between the parties”. The limited scope of exclusive jurisdiction rules under the Waseda Principles, then, plays an important role also at the recognition and enforcement stage, allowing to recognise and enforce foreign judgments on infringement matters and validity issues incidentally raised of registered IPRs of the requested country or of third States. Yet, according to Article 404 the decision resulting from a dispute over the incidental validity of foreign IPRs does not affect the validity or registration of those rights as against third parties, or as against the same parties to the dispute in question in subsequent proceedings, thus having no binding effect beyond the proceeding concerned147. 75. Amendment of Registers According to the seventh alternative argument, exclusive jurisdiction rules can be grounded on the fact that IPRs are registered in public registries and the same norms touch on proceedings, the outcome of which may require an IP office to correct its registers. Put simply, these proceedings having as their object the validity or legality of entries in these public registers cannot be recognised in the country where the register is kept. Thus, the exclusive jurisdiction rule related to IPRs claims could be considered as an “emanation” of Article 22(3) of the Brussels I Regulation that “in proceedings which have 146 147

Kono, Tada and Shin (n 218 Chapter I) 339. See Waseda Proposal (n 61 Chapter I) Explanatory Notes 48.

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as their object the validity of entries in public registers” poses another exclusive jurisdiction rule in favour of “the courts of the Member State in which the register is kept”. Yet, this argument is unconvincing for the following reasons. This argument is easily overcome by limiting the effects of the judgments of the forum State courts on foreign IPRs validity issues, however raised, to the parties of the proceedings so that no variation to the entries of the national registers would be required. In the absence of rules such as Article 22(3) of the EU Regulation even with regard to judgments with an erga omnes effect from the PIL perspective, it is perfectly conceivable to update inter alia civil status records and registers on the basis of foreign judgments given in another State, and against which no further appeal lies under the law of that State. Thus, for instance Article 21(2) of the Council Regulation (EC) No 2201/2003 of 27 November 2003 concerning jurisdiction and the recognition and enforcement of judgments in matrimonial matters and the matters of parental responsibility, repealing Regulation (EC) No 1347/2000148, stipulates that “no special procedure shall be required for updating the civil-status records of a Member State on the basis of a judgment relating to divorce, legal separation or marriage annulment given in another Member State, and against which no further appeal lies under the law of that Member State”. Indeed, in the absence of rules such as Article 21(2) of the Council Regulation (EC) No 2201/2003 the updating of the registers of a State on the basis of a judgment given in another State is perfectly possible, and regularly occurs, provided that the foreign judgment is recognized and enforced in the forum State. Thus, for instance in Italy the updating of the national civil-status records on the basis of a judgment relating to divorce, legal separation or marriage annulment given in another non-EU member State, and against which no further appeal lies under the law of that State, occurs on the basis of the recognition of this judgment by an Italian court and on the basis of the consequent order rendered by this same court to the Italian administrative competent offices. Yet, this recognition and enforcement of the foreign judgment in issue might be refused when it produces effects that are contrary to the public policy exception of a substantive or a procedural nature149. However, the recourse to the public policy exception shall be limited. Thus, for instance Article 34(1) of the Brussels I Regulation stipulates that “a judgment shall not be recognised […] if such recognition is manifestly contrary to the public policy of the recognising Member State”150. Similarly, 148

Council Regulation (EC) 2201/2003 (n 247 Chapter IV). See supra, previous para. 150 See supra, previous para. 149

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Article 64 of the Italian PIL statute States that foreign judgments of non-EU Member States shall be recognised in Italy inter alia when they “produce effects that are not contrary to public policy”, and the leading opinion maintains that in order for this Article to apply these effects must be manifestly contrary to Italian public policy151. These conclusions related to the possibility of amending registries on the basis of foreign judgments may be extended, mutatis mutandis, to IPRs transnational cases. Moreover, in support of those conclusions it can be maintained that exclusive jurisdiction rules do not apply to registration issues that arise by virtue of the transfer of a right for instance by contract, even though changes in the registries entries related to the IPR in issue might be necessary after a judgment adjudicating a transfer of a right by contract. Thus, inter alia in Japan recent cases decided on the merits of a claim for the registration of an assignment of a US patent and respectively a demand for cancellation of a previously registered transfer of a Jordanian trademark152. The exclusive jurisdiction rule of the CLIP Principles covers “disputes having as their object the grant, registration, validity, abandonment or revocation”153, but excludes disputes that may affect some of those issues but where the real object of the litigation is different, notwithstanding the fact that the respective disputes may result in decisions that may form the basis for changes in the records of the registries of a State, falling within the exclusive jurisdiction of the courts of the respective State154. Yet, the same result is achievable within the framework of the Brussels system, since its exclusive jurisdiction rules do not apply to ownership and entitlement issues155. The same can be said when registration is designed as a mere advantage to the IPR owner, such as to establish prima facie evidence in court of the validity of the IPR and of the facts stated in the registry156. It has been said that those situations differ from the one where registration is designed as a formal condition for the registered IPR to come into being, since in the latter cases the public authorities would play a constitutive role, whereas in the former situations the entries into the public register have merely declarative and advertisement purposes with regard to the recording of certain actions, such as the ones of the transferor and the transferee157. So, in 151 See Franco Mosconi and Cristina Campiglio, Diritto internazionale privato e processuale. Vol. 1. Parte generale e obbligazioni (5th edn, Torino, UTET 2010) 246. 152 Chaen, Kono and Yokomizo (n 51 Chapter I) 90, with references to the relevant Japanese cases, among which is the Coral Sand judgment. On this case see supra, para 16. 153 See supra, para 2. 154 See supra, para 2. 155 See supra, paras 2 and 8. 156 See supra, para 5. 157 Chaen, Kono and Yokomizo (n 51 Chapter I) 89, according to whom “with the exception of registration that establishes a right, as in the case of IP rights that are created by regis-

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the latter cases “it is reasonable to expect the registration agency in the country of registration to conduct a registration based on the judgment of a Japanese court, without requiring the country to recognise the judgment or take some other such procedures”158. Yet, it seems that even in these latter cases the public authorities’ change in the entries of the registries would require the court of the State where the registry is kept to recognise and enforce the Japanese or foreign judgment in question. So, no real difference would be at issue in this respect. In summary, the effects of foreign judgments on updating of national registers shall be determined not by excluding the international jurisdiction of foreign courts on matters inscribed in these registers, but rather according to the usual PIL relevant methods related to the recognition and enforcement of foreign judgments, namely the recourse to the public policy exception. Yet, the public policy exception shall be adopted in a restrictive way with regard to IP transnational litigation159. This result is confirmed by the commentaries on the Transparency Proposal, already referred to at para 23, according to which the same Proposal’s rejection of exclusive jurisdiction for foreign registered IPRs validity issues principally raised might lead to cases where a foreign court has international jurisdiction over actions concerning the validity of Japanese IP rights and invalidates those rights. In those cases, however, the non recognition of the foreign judgments at stake could be reached throughout the adoption of the public policy exception in the framework of the recognition proceeding, rather than by limiting ex ante the effects of the said judgment. Finally, assuming in arguendo that the problem of amendment of the national IP registries could be a convincing argument in favour of exclusive jurisdiction rules, the exercise of international jurisdiction over foreign IPRs would still not be impeded by it, since under general public international law a State’s declining of jurisdiction under exclusive jurisdiction rules implies a denial of justice and is contrary to the human right of access to a court160. 76. Forum Non Conveniens and Special Circumstances Test According to the eighth, and final, argument, the doctrine of forum non conveniens could be used to enforce de facto exclusive jurisdiction rules161. tration, the registration of IP rights is generally conducted for the purpose of publication, and is only conducted based on the substantive rights, and therefore has only a weak relationship with the state”. See also Bariatti, ‘La giurisdizione’ (n 47 Chapter I) 516. 158 Chaen, Kono and Yokomizo (n 51 Chapter I) 90. 159 See the previous para. 160 See the next chapter. 161 See the 17 national reports and the general report on the forum non conveniens doctrine concerning Argentina, Brazil, Canada, Quebec, Finland, France, Germany, Great Britain,

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This doctrine is most often applied in the US, but it is also used by UK courts as a basis for declining to exercise jurisdiction on the ground that a court in another State, “which also has jurisdiction, would objectively be a more appropriate forum for the trial of the action, that is to say, a forum in which the case may be tried more suitably for the interests of all the parties and the ends of justice”162. In Japan a “special circumstances test”163 is applicable according to which the whole or a part of a claim may be dismissed taking various factors into consideration, including procedural elements as well as the burden of applying foreign law164. Yet, forum non conveniens as well as the special circumstances test (hereinafter the forum non conveniens and the special circumstance test will be referred to as “forum non conveniens”) can only be applied by a court once it has already been determined that the court has international jurisdiction and therefore, from a technical perspective does not in itself ground exclusive jurisdiction165. However, in most cases, adoption of the forum non conveniens doctrine leads courts to decline to exercise jurisdiction over foreign IPRs claims, therefore leading to the same practical results as exclusive jurisdiction rules. Thus, forum non conveniens will be addressed through the following remarks, which will explain that it cannot be used to always lead to the declining of jurisdiction over foreign IPRs. At any rate, this conclusion does not bring into question the fact that the adoption of the same doctrine might be appropriate in IPRs cross-border litigation, for example, to prevent abusive forum shopping166, as well as when the dispute is being entirely adjudicated elsewhere and therefore the case

Greece, Israel, Italy, Japan, The Netherlands, New Zealand, Sweden, Switzerland, and USA, in James Fawcett (ed), Declining Jurisdiction in Private International Law: Reports to the XIVth Congress of the International Academy of Comparative Law, Athens, August 1994 (Oxford, OUP 1995). See also the literature referred to at the following footnotes. 162 Case C-281/02 Owusu v N.B. Jackson [2005] ECR I-1383 para 8 (citing Spiliada Maritime Corporation v Cansulex Ltd. [1986] AC 460 (HL) 476). On the forum non conveniens doctrine application to IPRs see de Miguel Asensio, ‘Cross-border’ (n 6 Chapter I) 108; Nicolas, ‘The Use of Preclusion Doctrine’ (n 2 Chapter III) 375. On the same doctrine in general terms see the resolution of the Institut de Droit International, Rapporteur Sir Lawrence Collins, ‘The principles for determining when the use of the doctrine of forum non conveniens and anti-suit injunctions is appropriate’ (Section de Bruges, 9 February 2003), available at accessed 30 November 2011. 163 Chaen, Kono and Yokomizo (n 51 Chapter I) 107-108, recalling relevant case-law of lower instances courts as well as of the Japanese Supreme Court. The test has been adopted in the Japanese new Act of Civil Procedure (ibid). 164 Chaen, Kono and Yokomizo (n 51 Chapter I) 108. 165 Nicolas, ‘The Use of Preclusion Doctrine’ (n 2 Chapter III) 375. 166 On abusive forum shopping see infra, para 100.

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could be better resolved there167. In sum, the dismissal of international jurisdiction on forum non conveniens grounds “should occur relatively rarely”168, especially where “personal jurisdiction exists”169 and in light of the fact that “if settlements are to be encouraged, signalling that the scope of the parties’ rights, both domestic and foreign, will be adjudicated if necessary may help focus parties’ minds, and get them to the table”170. Before addressing the relevant case-law on the point, it is important to remember that when deciding whether to issue forum non conveniens dismissals in cases where the court seized has international jurisdiction to adjudicate, the courts should take into account the private interest of the parties to the suit and the public interest involved171. The private interest factor consists of inter alia the ease of access to evidence and witnesses; the enforceability of the judgment; expediency; and the expense of litigating the dispute abroad. The public interest factor consists of inter alia the avoidance of unnecessary problems involving conflict of laws. However, those factors may be a consideration in the forum non conveniens analysis, but are not sufficient enough to warrant a dismissal since the court shall also consider the eventual availability of an adequate alternative forum that could hear the dispute in issue172. In this context, among the relevant judgments are the following173. In Mars, the US Court of Appeals for the Federal Circuit dismissed the infringement action. In doing so they stated that “in refusing to exercise jurisdiction over the Japanese patent infringement claim, the district court found that that claim would require the court to resolve complex issues of Japanese procedural and substantive law, a task further complicated by ‘having to agree on the proper translation of laws, documents and other communications.’ […] The court also found that general concerns respecting international comity counsel against exercising jurisdiction over a matter involving a Japanese patent, Japanese law, and acts of a Japanese defendant in 167

Nicolas, ‘The Use of Preclusion Doctrine’ (n 2 Chapter III) 381, quoting relevant US case-law where the courts should have dismissed the cases but did not. See also Austin, ‘The Concept of “Justiciability”’ (n 29 Chapter I) 406, proposing to assess jurisdiction through the lens of forum non conveniens rather than by adopting the justiciability or subject matter jurisdiction notions. See also supra, para 2. 168 Austin, ‘The Concept of “Justiciability”’ (n 29 Chapter I) 409. 169 Ibid. 170 Ibid. 171 See the US Supreme Court’s ruling in the case Gulf Oil Corporation v Gilbert 330 U.S. 501 (1947), on which see Nicolas, ‘The Use of Preclusion Doctrine’ (n 2 Chapter III) 375. See also Toraya (n 23 Chapter III) 1189. 172 Nicolas, ‘The Use of Preclusion Doctrine’ (n 2 Chapter III) 375, recalling the the US Supreme Court’s ruling in the case Gulf Oil Corporation v Gilbert (n 172 Chapter V) as well as other relevant US case-law. 173 For other US and UK case-law see Toraya (n 23 Chapter III) 1189; Chaen, Kono and Yokomizo (n 51 Chapter I) 107 footnote 86.

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Japan. […]. Thus, the trial court has already made findings pertinent to a forum non conveniens analysis which may support dismissal in favour of adjudicating the Japanese patent infringement claim in a suitable forum in Japan”174. Additionally, the US Court of Appeals for the Federal Circuit in Voda recognized that “where the doctrine does not duplicate other factors already considered, however, forum non conveniens is a useful doctrine to reference. For example, on the one hand, the cost of obtaining and translating evidence, especially experts in foreign patent law pursuant to Fed. R. Civ. P. 44.1 (governing determination of foreign law), cuts against exercising supplemental jurisdiction”175. But on the other hand, this rationale is unconvincing, at least when applied to always decline jurisdiction, for the following reasons. The forum non conveniens doctrine cannot be adopted in Europe within the frame of the Brussels system, as the ECJ’s Owusu decision maintained176. In the Owusu case, the plaintiff, a British national domiciled in the United Kingdom, suffered an accident while on vacation in Jamaica and subsequently brought an action in the United Kingdom for both breach of contract against the person who rented him the villa in Jamaica where the accident occurred, who was also domiciled in the United Kingdom, and an action in tort against several Jamaican companies responsible for the villa’s management, upkeep and control177. The defendants argued that the courts best positioned to hear the case were the Jamaican Courts, as opposed to the UK Courts178. Accordingly, the defendants asked the UK Court to decline its jurisdiction on the ground of forum non conveniens179. In response, the UK Court referred an interlocutory question to the ECJ asking it to establish whether the doctrine of forum non conveniens could be applied within the framework of the Brussels Convention, since the Convention did not explicitly make reference to it180. The ECJ answered that the doctrine could not be applied, citing the following arguments181. First, based on a literal interpretation of the Brussels Convention, the convention does not allow any derogation from the principles it lays down182. Second, the ECJ’s argument relied on an historical interpreta174

Mars (n 156 Chapter III) 1376. Voda (n 31 Chapter I) 904. 176 Owusu (n 163 Chapter V). On this case see Basedow, ‘Foundations of Private International Law’ (n 148 Chapter I) 28. On this case see Chris Hare, ‘Forum non Conveniens in Europe: Game Over or Time for Reflexions?’ [2006] J. Bus. L. 157-179. See also the literature referred to in the following footnotes. 177 Owusu (n 163 Chapter V) paras 10–12. 178 Ibid para 15. 179 Ibid. 180 Ibid. 181 Ibid. 182 Ibid para 37. 175

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tion of the Brussels Convention, according to which “[i]t is common ground that no exception on the basis of the forum non conveniens doctrine was provided for by the authors of the Convention, although the question was discussed when the Convention of 9 October 1978 on the Accession of Denmark, Ireland and the United Kingdom was drawn up, as is apparent from the report on that Convention by Professor Schlosser”183. Third, the ECJ argument was based on a teleological interpretation of the Brussels Convention, which stated that “respect for the principle of legal certainty, which is one of the objectives of the Brussels Convention (see, inter alia, Case C-440/97 GIE Groupe Concorde and Others [1999] ECR I-6307, paragraph 23, and Case C-256/00 Besix [2002] ECR I-1699, paragraph 24), would not be fully guaranteed if the court having jurisdiction under the Convention had to be allowed to apply the forum non conveniens doctrine”184; and “allowing forum non conveniens in the context of the Brussels Convention would be likely to affect the uniform application of the rules of jurisdiction contained therein in so far as that doctrine is recogni[z]ed only in a limited number of Contracting States, whereas the objective of the Brussels Convention is precisely to lay down common rules to the exclusion of derogating national rules”185. Fourth, the ECJ argument based on an ab inconvenienti interpretation of the Convention was that forum non conveniens would undermine the “legal protection of persons established in the Community”186. Moreover, the ECJ concluded that “[f]irst, a defendant, who is generally better placed to conduct his defen[s]e before the courts of his domicile, would not be able [...] reasonably to foresee before which other court he may be sued. Second, where a plea is raised on the basis that a foreign court is a more appropriate forum to try the action, it is for the claimant to establish that he will not be able to obtain justice before that foreign court or, if the court sei[z]ed decides to allow the plea, that the foreign court has in fact no jurisdiction to try the action or that the claimant does not, in practice, have access to effective justice before that court, irrespective of the cost entailed by the bringing of a fresh action before a court of another State and the prolongation of the procedural time-limits”187. Outside of Europe and the Brussels system, the forum non conveniens doctrine is also unable to adequately justify exclusive jurisdiction rules. The 183

Ibid, referencing Peter Schlosser, Report on the Convention on the Association of the Kingdom of Denmark, Ireland and the United Kingdom of Great Britain and Northern Ireland to the Convention on jurisdiction and the enforcement of judgments in civil and commercial matters and to the Protocol on its interpretation by the Court of Justice [1979] OJ C59/71 at 77–78. 184 Ibid para 38. 185 Ibid para 43. 186 Ibid para 42. 187 Ibid.

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Mars and the Voda judgments confirmed only the public interest in avoiding the difficulties related to the application of a foreign law in the forum. However, these judgments failed to confirm either the existence of private interests of the parties in the ease, expediency and expenses of the litigation, or “the existence of an adequate alternative forum in which the plaintiff could bring the suit, and failed to compare the US forum with the alternative forum based on all public and private interest factors”188. Yet, as will be explained in the following chapter the private interests of the parties of IPRs cross-border litigation is typically the avoidance of the fragmentation of this litigation by reason of the high costs of the duplication of proceedings in the field as well as of the risks of divergent outcomes of the duplicated cases. Chapter VI will highlight also that exclusive jurisdiction rules lead to the non-existence of adequate alternative fora in which plaintiffs can bring the entire suit. In sum, “fairness to both plaintiffs and defendants, as well as the interest that courts of all nations have in judicial economy, militate in favour of giving great weight to the avoidance of ‘piece-meal’ litigation in the forum non conveniens analysis”189. Furthermore, the Mars and Voda adoption of the forum non conveniens doctrine to ground their refusal to adjudicate the foreign IPRs claims is contrary to the private interests of avoiding fragmented litigation, as highlighted by “modern courts applying the forum non conveniens doctrine in transnational intellectual property disputes involving claims arising under both US and foreign laws [which] have either dismissed all claims, including those arising under US intellectual property laws, or none of them, rather than dismissing just the foreign claim while retaining jurisdiction over the US claim”190. As emphasised by the US Court of Appeals for the Second Circuit in the case of Boosey191, which reversed the District Court’s forum non conveniens dismissal of the claims arising under the copyright laws of 18 nations involved in the case, the effect of the dismissal was to “split the suit into 18 parts in 18 nations, complicate the suit, delay it, and render it more expen-

188 Nicolas, ‘The Use of Preclusion Doctrine’ (n 2 Chapter III) 377, criticizing the forum non conveniens adoption in the Mars case (n 156 Chapter III). The same critics are extendable to the same adoption in the Voda (n 31 Chapter I) judgment. See also Toraya (n 23 Chapter III) 1189. 189 Nicolas, ‘The Use of Preclusion Doctrine’ (n 2 Chapter III) 380-381. 190 Nicolas, ‘The Use of Preclusion Doctrine’ (n 2 Chapter III) 379, recalling the Creative Technology, Ltd. v Atzech System PTE, Ltd. 61 F.3d 696 (9th Cir. 1995); the Lockman Foundation v Evangelical Alliance Mission, 930 F.2d 764 (9th Cir. 1991); Boosey (n 23 Chapter IV). 191 On this case see also supra, para 45.

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sive”, whereas “trial would be more ‘easy, expeditious and inexpensive’ in the district court than dispersed to 18 foreign nations”192. Additionally, as recognised by the Voda judgment, extension of the forum non conveniens doctrine to IPRs cross-border litigation often “duplicate[s]”193 other arguments already used to justify exclusive jurisdiction rules, namely the difficulties of applying foreign law, the alleged unenforceability of the national judgment abroad and comity reasons194. Yet, those arguments are not convincing as indicated by the previous remarks195. Thus, all the reasons purported here against those arguments militate against adoption of the forum non conveniens doctrine in the IP field. Even assuming that the forum non conveniens doctrine was applicable to IPRs cross-border litigation, the exercise of international jurisdiction over foreign IPRs would still not be proscribed by it, since applying exclusive jurisdiction rules to decline jurisdiction implies a denial of justice and is contrary to the human right of access to a court196. This result is confirmed by the four sets of Principles. Even though those sets of Principles have provisions aimed at coordinating several courts’ jurisdictions, they “do not contain pany general exception clause that can reverse the result of the application of individual jurisdiction rules”197. In other words, none of the four sets of Principles refer to the forum non conveniens doctrine as applicable to transnational enforcement of IPRs cases.

192 Boosey (n 23 Chapter IV) 492. Nicolas, ‘The Use of Preclusion Doctrine’ (n 2 Chapter III) 380. 193 Voda (n 31 Chapter I) 902. 194 See above in this para. Particularly, on comity as (one of) the basis for the common law doctrine of forum non conveniens see Calamita (n 35 Chapter I) 631. 195 Particularly, see paras 39-41 and 71-75. 196 See the next chapter. 197 Chaen, Kono and Yokomizo (n 51 Chapter I) 108.

Chapter VI

Exclusive Jurisdiction Rules Imply a Denial of Justice and Violate the Fundamental Human Right of Access to Courts I. Introduction I. Introduction 77. Premise The previous chapters of this book have highlighted that exclusive jurisdiction rules related to IPRs cases are not based on any of the arguments usually invoked in their support. The following remarks of this chapter argue that existing exclusive jurisdiction rules must be abandoned with respect to registered or unregistered IPRs infringement issues and validity claims, however raised. In fact, exclusive jurisdiction rules are actually contrary to public international law rules on the avoidance of a denial of justice and on the fundamental human right of access to a court. 78. Denial of Justice To avoid the denial of justice to aliens and to grant them rights of access to domestic courts, a general principle of public international law has developed which requires a State to exercise jurisdiction even where it lacks international jurisdiction1. This same principle also constitutes a general principle of European Union law2. According to one thesis, States avoid denial of justice simply by making their judicial systems available to foreign nationals. This thesis is inspired by the Calvo Doctrine and has been adopted by many Latin American States. It is formulated, for instance, by the Salvadorian Rapporteur, on the topic of State 1

See Jan Paulsson, Denial of Justice in International Law (Cambridge, Cambridge University Press 2005) 10; Francesco Francioni, ‘The Right of Access to Justice under Customary International Law’ in Francesco Francioni (ed), Access to Justice as a Human Right (Oxford, OUP 2007) 10–11, according to whom in international law access to domestic justice starts to be perceived as a right of aliens and subsequently develops into a fundamental human right. On the fundamental human right of access to courts see the following remarks. On the general principles of law see Gaja (n 12 Chapter II). 2 See Takis Tridimas, The General Principles of EU Law (2nd edn, Oxford, OUP 2006) 370.

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responsibility for the Committee of Experts, in the Progressive Codification of International Law, which states that “denial of justice is therefore a refusal to grant foreign nationals free access to the Courts instituted in a State for the discharge of its judicial functions, or the failure to grant free access, in a particular case, to a foreigner who seeks to defend his right, although, in the circumstances, nationals of the State would be entitled to such access”3. The same opinion was adopted by the Report of the Inter-American Juridical Committee in 1961, according to which “the obligation of the State regarding judicial protection shall be considered as having been fulfilled when it places at the disposal of foreign nationals the national courts and the legal remedies for implementing their rights. The State cannot initiate diplomatic claims for the protection of its nationals nor bring an action before an international tribunal for this purpose when the means of resorting to the competent Court of the respective State have been made available”4. According to a second thesis, “access to justice is not simply access to the courts, but the availability of a system of fair and impartial justice, the effectiveness and legitimacy of which can be reviewed under international standards on the treatment of aliens”5. This second thesis is more in line with the need to grant foreign nationals effective judicial protection in comparison to the first thesis. It is codified, for instance, in Article 9 of the Harvard Draft on State Responsibility for Injuries to Aliens, according to which denial of justice exists when there is a denial, unwarranted delay or obstruction of access to courts, gross deficiency in the administration of judicial or remedial process, failure to provide those guarantees which are generally considered indispensable to the proper administration of justice, or a manifestly unjust judgment. An error of a national court which does not produce manifest injustice is not a denial of justice6. To avoid denial of justice, a domestic court must exercise its jurisdiction over a claim of an alien where two conditions are satisfied: first, where the case is linked to the forum State; and second, where no efficient alternative forum is available from which the applicant may seek redress. These requirements are also posed by the rule of jurisdiction by necessity, which constitutes the subject matter of the following remarks, having a scope analogous to that of the denial of justice rule, except that it not only concerns aliens but also citizens of the forum State7. Thus, the jurisdiction by necessity rule encompasses the denial of justice rule and, as such, the following analysis of the former may be extended to the examination of the latter. 3

See the references in Francioni (n 1 Chapter VI) 11. Ibid. 5 Ibid. 6 Ibid. 7 Tosato (n 20 Chapter II) 201-202 and there for further references. 4

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79. Forum Necessitatis To avoid denial of justice, not only to aliens but also to citizens, general public international law requires States lacking international jurisdiction over a case to nonetheless exercise jurisdiction by necessity by adopting the doctrine or principle of forum necessitatis8. Among the international norms recognizing forum necessitatis is Article 2 of the Inter-American Convention on Jurisdiction in the International Sphere for the Extraterritorial Validity of Foreign Judgments, adopted in La Paz in 1984, which states that “[t]he requirements for jurisdiction in the international sphere shall also be deemed to be satisfied if, in the opinion of the judicial or other adjudicatory authority of the State Party in which the judgment is to be given effect, the judicial or other adjudicatory authority that rendered the judgment assumed jurisdiction in order to avoid a denial of justice because of the absence of a competent judicial or other adjudicatory authority”9. Among the international soft law norms of an academic origin establishing forum necessitatis is Article 24 of the European Group for Private International Law’s “Proposed Amendment of Regulation 44/2001 in Order to Apply it to External Situations” adopted in Bergen, Norway on 21 September 2008, according to which “where no court of a Member State has jurisdiction under this Regulation, a person may be sued before the courts of a Member State 8 In certain common law legal systems, the jurisdiction by necessity or the forum necessitatis is also referred to as the forum conveniens. “The institution of the forum conveniens for certain aspects follows the same logic grounding the forum necessitatis in the civil law countries”, as such Giulia Rossolillo, ‘Forum necessitatis e flessibilità dei criteri di giurisdizione nel diritto internazionale privato nazionale e dell’Unione europea’ (2010) 2 Cuadernos de Derecho Transnacional 406 available at accessed 30 November 2011. See also Michaels, ‘Two Paradigms of Jurisdiction’ (n 77 Chapter I) 1054. On the forum necessitatis, see also Simon Othenin-Girard, ‘Quelques observations sur le for de nécessité en droit international privé suisse (Article 3 LDIP)’ [1999] SZIER 251; Lycette Corbion, Le déni de justice en droit international privé (PU AixMarseille 2004) 202; Fernández Arroyo, ‘Compétence exclusive’ (n 45 Chapter I) 74; Arnaud Nuyts, ‘Study on Residual Jurisdiction: Review of the Member States’ Rules concerning the “Residual Jurisdiction” of their courts in Civil and Commercial Matters pursuant to the Brussels I and II Regulations’ (3 September 2007) at 64, available at accessed 30 November 2011; Valentin Rétornaz and Bart Volders, ‘Le fort de necessité: tableau comparatif et évolutif’ [2008] RCDIP 227; Diego P. Fernández Arroyo, ‘Private International Law and Comparative Law: A Relationship Challenged by International and Supranational Law’ (2009) 11 Y.B. Priv. Int’l L. 42; Jeffery Talpis and Gerald Goldstein, ‘The Influence of Swiss Law on Quebec’s 1994 Codification of Private International Law’ (2009) 11 Y.B. Priv. Int’l L. 30. 9 Inter-American convention on Jurisdiction in the International Sphere for the Extraterritorial Validity of Foreign Judgments (adopted 24 May 1984, entered into force 24 December 2004) Article 2, available at accessed 30 November 2011.

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with which the claim has a sufficient connection, especially by reason of the presence of property in the territory of that State, if the right to a fair trial so requires, in particular: / (a) if proceedings in a non-Member State are shown to be impossible; or / (b) if it could not reasonably be required that the claim should be brought before a court of a non-Member State; or / (c) if a judgment given on the claim in a non-Member State would not be entitled to recognition in the State of the court seized under the law of that State and such recognition is necessary to ensure that the rights of the claimant are satisfied”10. In the European Union, the doctrine of forum necessitatis was adopted by a series of rules. Before examining these EU rules, it is relevant to note that the European Union Commission entrusted Professor Nuyts of Brussels University with preparing a study on “the Member States’ rules concerning residual jurisdiction of their Courts in civil and commercial matters pursuant to the Brussels I and II Regulations”11. This study was delivered on 3 September 2007, and included a part (Part I.C.16) on forum necessitatis. So, among the EU norms on forum necessitatis, Article 7 of the Council Regulation on jurisdiction, applicable law, recognition, and enforcement of decisions and cooperation in matters relating to maintenance obligations establishes that “[w]here no court of a Member State has jurisdiction pursuant to Articles 3, 4, 5 and 6, the courts of a Member State may, on an exceptional basis, hear the case if proceedings cannot reasonably be brought or conducted or would be impossible in a third State with which the dispute is closely connected. The dispute must have a sufficient connection with the Member State of the court seised”12. The jurisdiction by necessity rule has been adopted by the proposal for a Council Regulation amending Regulation EC 2201/2003, which regulates jurisdiction and applicable law in matrimonial matters13. According to 10 European Group for Private International Law, ‘Proposed Amendment of Regulation 44/2201 in Order to Apply it to External Situations’ (21 September 2008) Article 22 bis, available at accessed 30 November 2011. 11 Nuyts, ‘Study on Residual Jurisdiction’ (n 8 Chapter VI) 64. 12 Council Regulation (EC) 4/2009 of 18 December 2008 on jurisdiction, applicable law, recognition and enforcement of decisions and cooperation in matters relating to maintenance obligations [2009] OJ L7/1. 13 Commission Staff Working Document, ‘Annex to the proposal for a Council Regulation amending Regulation (EC) No 2201/2003 as regards jurisdiction and introducing rules concerning applicable law in matrimonial matters’ SEC (2006) 949 of 17 July 2006, available at accessed 30 November 2011; Commission Staff Working Document, ‘Impact Assessment for the proposal for a Council Regulation amending Regulation (EC) no 2201/2003 as regard jurisdiction and introducing rules concerning applicable law in matrimonial matters’ SEC (2006) 950 of 17 July 2006, available at accessed 30 November 2011.

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Article 7 of this proposal on residual jurisdiction, “where none of the spouses is habitually resident in the territory of a Member State and do not have a common nationality of a Member State, or, in the case of the United Kingdom and Ireland do not have their ‘domicile’ within the territory of one of the latter Member States, the courts of a Member State are competent by virtue of the fact that: (a) the spouses had their common previous habitual residence in the territory of that Member State for at least three years; or (b) one of the spouses has the nationality of that Member State, or, in the case of United Kingdom and Ireland, has his or her ‘domicile’ in the territory of one of the latter Member States”14. Finally, the forum necessitatis doctrine has also been proposed by the Green Paper on the Review of Council Regulation (EC) No 44/2001 on Jurisdiction and the Recognition and Enforcement of Judgments in Civil and Commercial Matters15. According to this proposal, it is “appropriate to create additional jurisdiction grounds for disputes involving third State defendants”16, that should find “a balance between ensuring access to justice on the one hand and international courtesy on the other hand”17, such as the “forum necessitatis, which would allow proceedings to be brought when there would otherwise be no access to justice”18 by “ensur[ing] that, where no court of a Member State has jurisdiction pursuant to the Regulation, the courts of the Member States may, on an exceptional basis, hear the case if proceedings cannot reasonably be brought or conducted or would be impossible in a third State with which the dispute is closely connected”19. At the domestic level, forum necessitatis has been adopted by both EU member States and States that are not members of the EU. Some EU Member States have adopted forum necessitatis through explicit statutory provisions or case law (Austria, Belgium, Estonia, Finland, Germany, Iceland, Lithuania, Luxembourg, the Netherlands, Poland, Portugal, Romania, Spain, and the United Kingdom) whereas in the remaining EU Member States there are neither statutes nor case law concerning forum necessitatis20. However, according to Professor Nuyts’ study on Member States’ residual jurisdiction, “that 14

Commission Staff Working Document, ‘Proposal for a Council Regulation amending Regulation (EC) No 2201/2003 as regards jurisdiction and introducing rules concerning applicable law in matrimonial matters’ COM (2006) 399 final of 17 July 2006, available at accessed 30 November 2011. 15 ‘Green Paper on the Review of Council Regulation (EC) No 44/2001 on Jurisdiction and the Recognition and Enforcement of Judgments in Civil and Commercial Matters’ COM (2009) 175 final of 21 April 2009. 16 Ibid 3. 17 Ibid 3. 18 Ibid 4. 19 Ibid 4 footnote 4. 20 Ibid.

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does not mean that the principle of forum necessitatis would necessarily be rejected by the court should a relevant case arise. Some national reporters expressly note that while there is no practice in their country, it could theoretically not be accepted, under general principles of law, that a party be deprived of the right of access to a court if this is necessary to vindicate his rights”21. States that are not members of the EU adopting forum necessitatis include: Argentina, Canada (including Quebec), Costa Rica, Japan, Mexico, Russia, South Africa, Switzerland, and Turkey22. Additionally, even in the US forum necessitatis has “occasionally been used to rationalize courts’ decisions”, having been taken into account by the Supreme Court who “has suggested such a basis might be possible”23. Finally, these EU Member States and States that are not members of the EU already exercise jurisdiction by necessity, particularly in custody, divorce, succession, and asylum cases, but also in commercial matters24. In general, the exercise of jurisdiction by necessity is conditioned upon two requirements: (1) the case must have some connection to the forum State, and (2) it must be unreasonable to bring proceedings abroad. The first requirement, that the case present “some kind of connection with the forum”25, poses a proximity condition26 to avoid encumbering a particular jurisdiction with the task of correcting all denials of justice happening around the entire world27. However, this requirement does not exist in the systems of the Netherlands or the United Kingdom, neither of which impose proximity conditions28. Where a proximity condition is required, “there is a general consensus that the required connection exists at least when the plaintiff is domiciled or habitually resident in the forum State, or even when he is a citizen of that State. But any other contacts with the forum State may be relevant, depending on the circumstances, such as for instance the presence of assets within the jurisdiction”29. The second requirement is that “it is ‘unreasonable,’ ‘unacceptable [...] there is an ‘unreasonable difficulty’ to bring proceedings abroad, or [...] the plaintiff ‘cannot be expected’ to do so”30. This second requirement is slightly 21 22

Nuyts, ‘Study on Residual Jurisdiction’ (n 8 Chapter VI) 64. See the doctrine referred to at footnotes (n 8 Chapter Vi) and the necessary references

there. 23

Michaels, ‘Two Paradigms of Jurisdiction’ (n 77 Chapter I) 1054. See the doctrine referred to at footnote (n 8 Chapter VI). 25 Nuyts, ‘Study on Residual Jurisdiction’ (n 8 Chapter VI) 65. 26 Othenin-Girard (n 8 Chapter VI) 275. 27 Rétornaz and Volders (n 8 Chapter VI) 235. 28 Rossolillo (n 8 Chapter VI) 19 and there for further references. 29 Nuyts, ‘Study on Residual Jurisdiction’ (n 8 Chapter VI) 66. See also Rétornaz and Volders (n 8 Chapter VI) 235-240. 30 Nuyts, ‘Study on Residual Jurisdiction’ (n 8 Chapter VI) 65. 24

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different from those under EU norms, which refer only to the unreasonableness of bringing proceedings before the courts of third States, but not to the unreasonableness of bringing proceedings before the courts of EU member States31. However, as will be argued in the following remarks, this limiting of EU norms to proceedings before States that are not members of the EU shall be overridden by way of interpretation of those norms, affecting as a result also proceedings before EU member States. The second requirement is satisfied when there is a legal obstacle preventing access to the ordinary, competent foreign court, for instance, if that court will not guarantee a fair trial to the parties or its decision will not be enforceable in the forum State. In fact, in this latter situation, “if a decision rendered by a EU member State is not [recognized] and executed in the requested country, by virtue of impeding reasons unrelated to its merits (such as a violation of the right of defen[s]e), the party to whom the exequatur [sic] has been refused has the right, in the absence of another competent Court, to raise his action before a Court of the requested State, albeit this last Court does not have jurisdiction according to the Convention or the Regulations: this last Court can ascertain its jurisdiction recalling the denial of justice according to its domestic laws”32. This thesis addresses cases either already decided or currently pending before the courts of EU Member States, and thus, entering into the framework of the Brussels system. However, the conclusions of this thesis may be easily extended, mutatis mutandis, to other cases where, from the perspective of the forum state, ordinary jurisdiction does not lie with it, but with a court of another State, not a member of the EU, that has already rendered a decision that the forum State either does not recognize or will not enforce33. This second requirement of forum necessitatis is also met when there is a practical obstacle to effectively accessing foreign courts. An example of this would be when “the cost of bringing proceedings abroad would be ‘out of proportion’ with the financial interests involved in the case”34. In establishing whether the two requirements of forum necessitatis have been met, it is necessary to proceed on a case-by-case basis, and to adopt an extensive interpretation of forum necessitatis itself. Thus, forum necessitatis

31

See infra. Gaudemet-Tallon (n 105 Chapter V) 73, according to whom ‘si une décision venant d’un État communautaire s’est heurté à un refus de reconnaissance et d’exécution dans l’État requis, refus fondé sur des motifs étrangers au fond du droit (par exemple, une violation des droits de la défense), la partie à qui l’exequatur a été refusé aurait le droit, en l’absence d’autre tribunal compétent, de porter son action au fond devant un tribunal de l’État requis, pourtant non doté de compétence selon la convention ou le règlement: ce dernier pourrait se reconnaître compétent sur la base du déni de justice selon le droit commun du for’. 33 This is precisely what happened in Lucasfilm Entertainment (n 29 Chapter I). 34 Nuyts, ‘Study on Residual Jurisdiction’ (n 8 Chapter VI) 65. 32

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grants the fundamental human right of access to courts;35 and therefore, an extensive interpretation of forum necessitatis favors this fundamental human right. Second, with particular regard to the first requirement of a connection between the case and the forum State, “forum necessitatis supposes the absence of another forum in [the forum State, and thus the] connections with [the forum State] will very rarely have a strict nature”36. The first requirement of forum necessitatis, the existence of a link between the case and the forum State, raises the question of whether such a link can be considered present if the relevant international procedural norms do not support the forum State’s ordinary jurisdiction. In other words, since international procedural norms generally allocate ordinary jurisdiction to the courts of the forum State only where a link exists, could this link be considered lacking when international jurisdiction rules do not underlie the jurisdiction of the forum State’s courts? For the following reasons the answer to this question must be no. First, jurisdiction by necessity presupposes the absence of ordinary international jurisdiction in the forum State; thus, the absence of ordinary international jurisdiction does not preclude recourse to jurisdiction by necessity. Second, “international practice” is vast and “shows that [...] the technical argument of lack of jurisdiction has not prevented the finding of a denial of justice”37. Third, this conclusion is supported by the argument that the requirements of the forum necessitatis should always be interpreted in an extensive way. With respect to the second requirement of forum necessitatis, the unreasonableness of bringing proceedings abroad, the question arises as to whether a duplication of proceedings38 can be considered unreasonable. This question is particularly relevant with respect to European patent litigation, since Article V(d) of the Protocol annexed to the Brussels Convention states that “[w]ithout prejudice to the jurisdiction of the European Patent Office under the Convention on the grant of European Patents, signed at Munich on 5 October 1973, the courts of each Contracting State shall have exclusive jurisdiction, regardless of domicile, in proceedings concerned with the registration or validity of any European patent granted for that State”39. It is also particularly relevant to 35

Rétornaz and Volders (n 8 Chapter VI) 261. On the fundamental human right of access to courts see infra. 36 Othenin-Girard (n 8 Chapter VI) 276 and there for further references. See also Rétornaz and Volders (n 8 Chapter VI) 234, according to whom “il s’agit en effet d’évaluer le coût global, et donc pas uniquement monétaire, d’un procès à l’étranger par rapport à ce qu’on peut exiger du demandeur”. Translation: “it is then necessary to evaluate the global costs, and therefore not only the economic ones, of a foreign proceeding in relation to what is possible to require from a plaintiff”. 37 Francioni (n 1 Chapter VI) 12. 38 On the notion of duplication of proceedings see supra, para 5. 39 Protocol annexed to the Brussels Convention (n 84 Chapter I), Article 5(d).

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European patent litigation since the ECJ rendered the Roche decision and maintained that “Article 6[1] of the Brussels Convention [now Article 6(1) of the Brussels I Regulation according to which a] defendant domiciled in a Contracting State may be sued: (1) where he is one of a number of defendants, in the courts for the place where any one of them is domiciled [...] must be interpreted as meaning that it does not apply in European patent infringement proceedings involving a number of companies established in various Contracting States in respect of acts committed in one or more of those States even where those companies, which belong to the same group, may have acted in an identical or similar manner in accordance with a common policy elaborated by one of them”40. Since neither the patent infringements of which the various defendants are accused or the national law in relation to which those acts are assessed are the same, there is no risk of irreconcilable decisions being given in European patent infringement proceedings brought in different contracting States because the possibility of divergent decisions would not arise in the context of the same factual and legal situation. Under this framework, the ECJ will have an opportunity to limit the interpretation of the Roche decision. In fact, on September 15, 2010, the District Court of The Hague referred questions to the ECJ concerning the correct interpretation of irreconcilable decisions in the context of Article 6(1) of the Brussels I Regulation. Thus, according to the District Court of The Hague, the ECJ Roche decision was not applicable in the case at hand, as it “concerned a case where the various defendants were accused only of infringing a patent in the respective countries where they were situated (so defendant A in country A; defendant B in country B; etc.), whereas in the current case, the various defendants were each accused of infringing a patent in all of the respective countries that are mentioned in Solvay's claim for a cross-border injunction (so defendant A both in country A and in country B; defendant B both in country A and in country B; etc.)”41. According to the District Court of The Hague, “in such an event Article 6(1) [Brussels I Regulation] would be applicable as there would be a risk of ‘irreconcilable decisions.’”42 Additionally, the Green Paper on the Review of Council Regulation (EC) No. 44/2001 recognizes the need to amend the Regulation in the sense of allowing a consolidation of proceedings with respect to the European patents infringements perpetrated by companies belonging to the same group43.

40 Roche v Primus (n 120 Chapter II) paras 5 and 41. On this decision see the doctrine quoted supra, note 7. 41 Solvay v Honeywell (n 307 Chapter I). 42 Ibid. 43 Green Paper on the Review of Council Regulation (EC) No 44/2001 (n 15 Chapter VI) 6.

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Even assuming the eventual restrictive interpretation of the Roche decision and amendment of the Brussels Regulation on that point, this would not change the need to answer the question posed here as to whether the duplication of proceedings in relation to IPRs cases can be considered unreasonable. In fact, the notion of duplication of proceedings adopted here does not concern European patents alone, but extends, mutatis mutandis, to all other IPRs. This is the same notion referred to by the recent study on Economic-Cost Benefit Analysis of a Unified and Integrated European Patent Litigation System44 already referred to, according to which duplicated cases are the proceedings when the introduction of a unified court would render one or several of the cases unnecessary, i.e. if the different national proceedings are substitutes in a legal and economic sense45. With this clarification in mind, the answer to the current question as to whether a duplication of proceedings can be considered unreasonable should be yes for the following reasons. First, the conclusion that duplication of proceedings can be considered unreasonable is supported by the argument that the requirements of forum necessitatis should always be interpreted in an extensive way. Second, this conclusion is also supported by the fact that duplication increases litigation costs (and also may lead to divergent outcomes), rendering them out of proportion with the financial interests involved in the case46. As already seen, this circumstance might constitute a practical obstacle to bringing proceedings abroad, which could render it unreasonable to do so. Third, this conclusion is confirmed by a recent series of Swiss decisions concerning the administration of immovable estates located in more than one State, including the forum State. In a 1990 decision, the Zurich Obergericht exercised jurisdiction by necessity over the succession of a UK citizen last domiciled in Italy, in relation to various estates located in different States, including Switzerland and Luxembourg47. In that case, the plaintiff asked the Zurich Court of First Instance to adjudicate the succession of the Swiss and Luxembourg estates. The requested court declined its competence on the grounds that Swiss international procedural law conferred only international jurisdiction to the Swiss courts in succession matters where the de cuius was last domiciled in Switzerland, whereas in the case before the court the de cuius was last domiciled in Italy. However, the Zurich Court of Second Instance reversed the decision, on the grounds that the courts that would have ordinarily been competent to hear the case could not have addressed it in its entirety. That is, the courts of the State 44 Harhoff (n 214 Chapter I), on which see Jaeger, Hilty, Drexl and Ullrich (n 112 Chapter I) 818. 45 See supra, para 5. 46 See infra, para 90. 47 See Obergericht ZH, Feb. 1, 1990, ZR 89 (1990), n. 4, p. 7 (Swi.). On this decision see Othenin-Girard (n 8 Chapter VI) 283.

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where the de cuius was last domiciled, Italy, were not competent to address the succession issues related to the estates located abroad, while, analogously, the courts of the State of the de cuius’ nationality, the UK courts, were not competent to adjudicate the matters related to the “foreign” estates, and the courts of the State where the estates were located, i.e., Luxembourg, were competent to address only the issues related to their local estates. Thus, the Zurich Court of Second Instance concluded that requiring the plaintiff to raise proceedings in the United Kingdom, Italian, Luxembourg, and Swiss courts would have been unreasonable, and established its jurisdiction by necessity over the succession of both the Swiss and Luxembourg estates. This same result was reached in a subsequent case also rendered by the Zurich Obergericht in 199248. The plaintiffs in that case asked the Swiss Court of First Instance to adjudicate the succession of an Iraqi citizen last domiciled in London, with regard to various estates located in Switzerland and Liechtenstein. The requested court declined its competence on the grounds that the de cuius was last domiciled in London not in Switzerland. However, the Zurich Court of Second Instance reversed the decision, finding that, firstly, it was unnecessary to establish the international jurisdiction of the Iraqi Courts since the de cuius was a refugee in the United Kingdom, and, according to the Swiss international jurisdiction rules (Article 24(3)), where these rules refer to citizenship, in cases of refugees they shall be interpreted as designating the domicile. Secondly, the UK courts ordinarily competent to hear the case could not have addressed it in its entirety, since they could not have adjudicated the issues related to the estates in Switzerland and Liechtenstein. Thus, the Zurich Court of Second Instance concluded that requiring the plaintiff to raise proceedings before both the UK and Swiss courts would have been unreasonable, and thereby established its jurisdiction by necessity over the succession of both the Swiss estates and those located abroad. In sum, both of the preceding disputes were such that no single State had the ordinary jurisdiction to address them in their entirety, thereby requiring the plaintiff to otherwise start several “local” proceedings before the courts of each State where the estates were located. In such a context, the courts of the forum State considered the bringing of so many proceedings before so many different courts to be unreasonable, and thereby determined that the duplication of proceedings met the second requirement of forum necessitatis49. It should also be noted that these adjudications also met the first requirement of the doctrine of forum necessitatis, in that the cases were linked to the forum State at least by the presence of estates in Switzerland.

48 See Obergericht ZH, Feb. 26, 1992, ZR 90 (1991), n. 89, p. 289 (Swi.). On this decision see Othenin-Girard (n 8 Chapter VI) 284. 49 Othenin-Girard (n 8 Chapter VI) 283–284.

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80. Hierarchy of the Sources of Law Another question that arises is whether the international, EU, and domestic rules on forum necessitatis are expressions of, or constitute, a general principle of law50. This question should be answered in the affirmative for at least the following reasons. First, since the avoidance of the denial of justice is a general principle of law, and forum necessitatis aims at avoiding the denial of justice, the former should have the same legal nature as the latter. Moreover, although forum necessitatis extends the scope of the rule of avoidance of the denial of justice, in that it concerns not only aliens but citizens alike, this difference does not change the conclusion just reached. Forum necessitatis avoids not only the denial of justice, but also discrimination between citizens and aliens in the exercise of the right of access to courts. The avoidance of discrimination and the right of access to a court are fundamental human rights and, as such, constitute general principles of law. It thereby follows that forum necessitatis should have the same juridical nature as these general principles of law. Second, the conclusion that forum necessitatis constitutes a general principle of law is supported by the fact that the international, EU, and municipal rules establishing it generally take the same approach to this notion, creating a genuine common denominator, namely the two requirements of proximity to the forum State and the unreasonableness of litigating before the ordinary competent court. Since the existence of a genuine common denominator among rules is one possible criterion for the construction of a general principle of law51, it is reasonable to conclude that forum necessitatis constitutes a general principle of law. Third, this conclusion is not deniable just because two of the municipal rules concerning forum necessitatis permit its adoption without imposing a proximity requirement, or because EU norms limit its adoption to cases where the ordinary competent court is in a State that is not a member of the EU. While the two municipal rules that do not establish a proximity requirement do increase the scope of the forum necessitatis, they do so without compromising the genuine common denominator between all the other, more rigorous, rules. The same can be said with regard to the EU norms that limit the adoption of forum necessitatis to cases where the ordinary competent court is in a State that is not a member of the EU. While it is evident that the EU rules limit rather than increase the scope of forum necessitatis, this limitation does not compromise the genuine common denominator between all the other rules, which are more liberal in that they do not distinguish between the EU external or internal location of the ordinary competent court. Moreover, as 50 51

Gaja (n 12 Chapter II) passim. Gaja (n 12 Chapter II) 30.

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will be highlighted by the following remarks, although the EU norms explicitly refer to cases where the ordinary competent court is of a State that is not a member of the EU, they should be interpreted as also allowing the exercise of jurisdiction by necessity when the ordinary competent court is in an EU member country. Fourth, this conclusion is supported by Nuyts’ study commissioned by the EU, according to which forum necessitatis is a “general principle of public international law”52. The characterization of forum necessitatis as a general principle of law leads to the following conclusions. From a primary law53 coordination of norms and hierarchical perspective54, forum necessitatis has direct effect in the EU and in the internal legal systems, and prevails over domestic rules, EU secondary norms, and international conventions. This is because “[o]ne cannot assume that treaty rules always prevail over general principles of law. This would normally be the case when the treaty and the general principle cover the same ground. However, a general principle could also affect the way in which a certain treaty rule is to be applied. It could impinge on the application of the treaty rule under limited aspects. In that case it would be more appropriate to say that the principle prevails”55. Therefore, the municipal norms that do not contemplate forum necessitatis should be interpreted by the domestic courts as not impeding jurisdiction56. Accordingly, the European Union provisions that do not contemplate or that exclude forum necessitatis should either be interpreted by the domestic courts of the EU Member States as not impeding the adoption thereof, or simply should not be applied by those domestic courts, or should be declared partially invalid by the ECJ on 52 Nuyts, ‘Study on Residual Jurisdiction’ (n 8 Chapter VI) 64. See also Rétornaz and Volders (n 8 Chapter VI) 229, according to whom “le for de nécessité découle d’un principe général interdisant les dénis de justice”. Translation: “the jurisdiction by necessity forum arises out of a general principle that imposes to avoid the denial of justice”. 53 With the term primary law, this book refers to Part I of the International Law Commission, ‘Draft Articles on Responsibility of States for Internationally Wrongful Acts’ [2001] Yearbook of the International Law Commission 26, Supplement No. 10 (A/56/10) (Draft Articles) available at accessed 30 November 2011, on “[t]he internationally wrongful act of a State [that] deals with the requirements for the international responsibility of a State to arise” (ibid 32). 54 For a comparative perspective on the “hierarchy” of the sources of international law in the different national legal systems involved: Argentina, Austria, Australia, Bulgaria, Canada, Czech Republic, France, Germany, Greece, Hungary, Israel, Italy, Japan, Luxembourg, Netherlands, New Zealand, Poland, Portugal, Russian Federation, Serbia, Slovakia, United Kingdom, United States, Uruguay, and Venezuela, see Dinah Shelton (ed), International Law in Domestic Systems (Oxford, OUP 2010). 55 See generally Gaja (n 12 Chapter II) 22. 56 Ibid.

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grounds of “infringement of the [EU] Treaties or of any rule of law relating to their application[,]”57 as they are general principles of law or, depending on the circumstances of the case, through a proceeding to review the legality of the norms under Article 263 of the Lisbon Treaty or through a preliminary ruling under Article 26758. Finally, the international treaties that do not contemplate, or that exclude, forum necessitatis should either be interpreted by the domestic courts of the party States as indeed allowing the doctrine’s adoption or should not be applied where they exclude forum necessitatis. It is true that inconsistency with a general principle of law does not generally invalidate a treaty59. However, since forum necessitatis is a general principle of law, it can be considered by a domestic court as prevailing over the implied treaty rule, and thus impinging on the application of the treaty rule, thereby allowing access to the court. 81. Forum Necessitatis in the EU Brussels System Another question that arises is whether forum necessitatis also applies to cases falling within the scope of international conventions or EU norms that establish international jurisdiction rules, but do so without explicitly including a jurisdiction by necessity provision. The Brussels system, in particular, will be examined below. In answering this question, it is relevant to recall the ECJ’s Owusu decision60, that addresses forum non conveniens61, rather than forum necessitatis and according to which the forum non conveniens doctrine cannot apply in the Brussels system. It is therefore important to establish whether the arguments grounding the Owusu decision may be extended from the context of forum non conveniens to that of forum necessitatis. To this end, a first thesis has determined that there are four possible groups of cases, three of which are not controlled by Owusu. Thus, forum necessitatis can be adopted in those three groups of cases62. In the first group of cases established by this thesis, international jurisdiction is allocated under the Brussels System to the courts of a non-member State. In those cases, this thesis determines that the Owusu decision does not preclude the member States’ courts from applying forum necessitatis. On one hand, this conclusion is based on the “unilateral perspective” of the Brussels System, which privileges the exercise of jurisdiction by the courts of member States over the courts of non-member States. On the 57

Treaty of Lisbon (n 123 Chapter I) Article 263 (ex Article 230 TEC). Ibid Article 267 (ex Article 234 TEC). 59 Except where the general principle of law expresses a jus cogens rule, see Article 53 on Treaties conflicting with a peremptory norm of general international law (“jus cogens”), of the Vienna Convention on the Law of Treaties (n 139 Chapter IV). 60 See above supra para 71. 61 On the forum non conveniens notion see chapter V. 62 Rossolillo (n 8 Chapter VI) 417. 58

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other hand, the conclusion is based on the differences between forum non conveniens and forum necessitatis. The latter provides the forum court with jurisdiction that would otherwise not exist, whereas the former deprives the forum court of jurisdiction that otherwise does exist. Thus, forum non conveniens can lead to the denial of justice, whereas forum necessitatis, by its nature, avoids such a denial. In addition, the Owusu decision was aimed at safeguarding the “legal protection of the persons established in the [territory]” covered by the Brussels System63. Therefore, transferring proceedings, by virtue of forum non conveniens, to the courts of a non-member State would deprive the persons established in the territory, and thereby covered by the Brussels System, of its procedural and substantive standard of protection and of its regime of free circulation of decisions. In contrast, however, forum necessitatis implies the exercise of jurisdiction by the forum court of a member State, and is therefore in line with the system and standards established by the Brussels System to safeguard those aforementioned procedural and substantive rights. In the second group of cases delineated by this thesis, under the Brussels system, international jurisdiction is allocated to the courts of an EU Member State other than that of the forum, but the courts of the forum State are permitted to exercise jurisdiction by necessity either because the other member State’s decision will be unenforceable in the forum State’s courts for reasons of public policy, or because non-fortuitous or force majeure circumstances, such as a war or an earthquake, impede the plaintiff from bringing the proceedings before the ordinarily competent court. According to this thesis, in such cases the exercise of jurisdiction by necessity does not imply an evaluation of the legal system of the State with ordinary jurisdiction. Thus, the Owusu decision does not preclude the exercise of jurisdiction by necessity. This conclusion is based, mutatis mutandis, on the reasons set forth with respect to the first group of cases examined. In the third group of cases established by this thesis, international jurisdiction is allocated under the Brussels System to the courts of a member State, but the forum State is permitted to exercise its jurisdiction by necessity due to the need to grant the plaintiff certain rights not recognized by the legal system of the State with ordinary competence, such as the right to contract a samesex marriage. Here, the exercise of jurisdiction by necessity implies an evaluation of the legal system of another member State. Yet, in these cases, this thesis holds that the Owusu decision does not preclude such jurisdiction. On the one hand, this conclusion is based on the need to safeguard the rights in question, such as the right to contract a same-sex marriage. On the other hand, this conclusion is based, mutatis mutandis, on the reasons set forth with respect to the first group of cases examined. 63

Owusu (n 163 Chapter V) para 2.

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Finally, in the fourth group of cases established by this thesis, international jurisdiction is allocated under the Brussels system to the courts of a Member State, but the exercise of jurisdiction by necessity is not permitted since it is grounded on reasons such as excessive time or cost of proceeding before the “ordinary” competent court. In those cases, this thesis holds that such an exercise of jurisdiction implies an evaluation of the legal system of the State with ordinary jurisdiction. The thesis thereby holds that in those cases the Owusu decision precludes the exercise of jurisdiction by necessity. This conclusion is grounded not on the differences but rather on the similarities between the forum non conveniens and the forum necessitatis, namely, that they both provide domestic courts with great discretionary power to establish on a case-bycase basis whether it is appropriate to exercise jurisdiction, and that excluding the adoption of forum non conveniens and forum necessitatis only when the ordinary competent court is located in a EU member State implies an obligation of mutual trust between member States, which is the concept that lay at the base of the Brussels System64. The conclusions of this first thesis are convincing in relation to the first three groups of cases proposed by it, specifically the groups of cases that exclude the application of the ECJ Owusu decision to forum necessitatis. However, it seems that the arguments on which this thesis grounds its conclusions are not convincing. Also, other reasons exist on the basis of which one may conclude that forum necessitatis is always applicable no matter the peculiarities of the case involved, such that the distinction among the different groups of cases is unnecessary. The arguments raised by this thesis are unconvincing for the following three reasons. First, on the one hand, this thesis does not permit the adoption of forum necessitatis when, as in the fourth group of cases, ordinary jurisdiction belongs to another member state and the forum’s exercise of jurisdiction would imply an evaluation of the other State’s system. Yet, on the other hand, when as with the third group of cases, institutions are involved that are unknown to the state with ordinary jurisdiction, such as same-sex marriage, this thesis allows the forum State to exercise jurisdiction by necessity notwithstanding the fact that ordinary jurisdiction belongs to another member State, and that such an exercise of jurisdiction implies an evaluation of the other state’s legal system. Additionally, this thesis justifies disparate treatment on the grounds that only the latter cases implicate rights deserving special protection. Here, the weakness of this thesis’ logic lies in its failure to recognize that both the former and the latter cases relate to the right

64 Krombach (n 95 Chapter V); Case C-116/02 Erich Gasser GmbH v MISAT Srl [2003] ECR I-14693, on both of which in relation to the obligation of mutual trust, see Rossolillo (n 8 Chapter VI) 417; Luca Radicati di Brozolo, ‘Choice of Court and Arbitration Agreements and the Review of the Brussels I Regulation’ (2010) 30 IPRax 121.

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of access to courts, which as a fundamental human right also deserves special protection. Second, this thesis contradicts itself. It allows the exercise of jurisdiction by necessity when, as in the second group of cases, the decision of the court of ordinary competence would be contrary to the public policy of, and thus unenforceable in, the forum State, while at the same time, it proscribes such jurisdiction when, as in the fourth group of cases, bringing a proceeding before the court of ordinary competence would entail excessive time or cost. However, since the excessive time or cost of a proceeding renders a judgment contrary to Article 6 of the European Convention for the Protection of Human Rights and Fundamental Freedoms, opened for signature by the member States of the Council of Europe in Rome on 4 November 1950 (ECHR) and thus, contrary to the public policy of the forum member State, it is therefore also unenforceable in the forum State. Third, this thesis first emphasizes the differences between forum necessitatis and forum non conveniens, then suggests an application to the former of the Owusu decision related to the latter, then subsequently highlights the similarities between forum non conveniens and forum necessitatis, and then finally suggests an application to the latter of the Owusu decision related to the former. Thus, this thesis is not linear, as well as being excessively complicated. In contrast, the thesis proposed here maintains that forum necessitatis can always be adopted, even within the framework of international conventions that do not explicitly mention it, for the following eight reasons. First, a coordination of the norms and hierarchical interpretation of the Brussels System and forum necessitatis highlights that the latter constitutes a general principle of law and as such prevails over the Brussels System. Second, a literal interpretation of the Brussels System indicates that it does not explicitly impede application of forum necessitatis. Third, a teleological and systematic interpretation of the Brussels System and the norms concerning fundamental human rights indicates that, since the fundamental human right of access to courts is at the basis of the forum necessitatis, the Brussels System must be interpreted as operating in a sense favorable to, and as ultimately adopting, forum necessitatis. Fourth, a teleological and systematic interpretation of the Brussels System and the norms of fundamental human rights also highlights that the obligation of mutual trust and the need for legal certainty cannot prevail over the fundamental human right of access to courts. This conclusion is in line with the jurisprudence of the European Court of Human Rights (ECtHR), according to which member States of the ECHR violate its Article 6 provision even when they limit the applicant’s right of access to courts to give effect to the rules of an international agreement65, such as the Brussels and Lugano Conventions. Furthermore, as will be argued by the following re65

See infra.

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marks, the same conclusions apply with respect to EU norms such as the Brussels I Regulation, despite the peculiarities of the relation between the ECHR and the European Union. Fifth, a teleological interpretation of the Brussels System emphasizes that even in the presence of such a system “the risk of a negative conflict of competence is never totally inexistent; it is never possible to exclude that the sei[z]ing of the Courts of a member State which is exclusively competent with respect to the [Brussels System] happens to be impossible for the plaintiff, and therefore that he suffers a denial of justice”66. Indeed, the Brussels System “aims at improving the condition of the persons involved and not at depriving them of an accessible Court when they suffer a denial of justice by reason of a malfunction of a mechanism instituted by an international instrument”67. Thus, the existence of the Brussels System cannot preclude the exercise of jurisdiction by necessity. Sixth, a historical interpretation of the Brussels System demonstrates that, during its adoption, no discussion with respect to forum necessitatis occurred. Thus, no argument precluding the exercise of jurisdiction by necessity can be derived from its legislative history. Seventh, the thesis proposed here is supported by current States’ practice, which already applied forum necessitatis to cases falling within the scope of the Brussels System, even when ordinary jurisdiction belonged to the courts of another member State. Eighth, the thesis proffered here does not contradict the ECJ Owusu decision since this decision does not explicitly concern the forum necessitatis. Additionally, as already mentioned, forum non conveniens deprives a forum court of jurisdiction that otherwise exists, as such bringing jurisdiction outside the European Union, whereas forum necessitatis provides the EU Courts with jurisdiction that would otherwise not exist and, therefore, is in line with the need to safeguard the “legal protection of the persons established in the [territory]”68 covered by the Brussels System. Then, unlike forum non conveniens, the legislative history of the Brussels Convention does not preclude the exercise of jurisdiction by necessity. Finally, mutatis mutandis, the aforementioned reasons lead to the conclusion that while the above EU norms explicitly contemplate forum necessitatis only with respect to cases belonging to the ordinary jurisdiction of States that are not members of the EU, jurisdiction by necessity can still be exercised in

66

Othenin-Girard (n 8 Chapter VI) 266, “le risque d’un conflit négatif de compétence n’est jamais totalement inexistant; on ne peut jamais exclure que la saisine des juridictions d’un Etat contractant exclusivement compétent au regard de la convention se révèle impossible pour le demandeur, et que celui-ci subisse un déni de justice”. See also GaudemetTallon (n 105 Chapter V) 73. 67 Othenin-Girard (n 8 Chapter VI) 267, “pour fonction d’améliorer le sort des justiciables et non de les priver d’un for lorsqu’elles subissent un déni de justice en raison du mauvais fonctionnement des mécanismes instaurés par l’instrument international”. 68 Owusu (n 163 Chapter V) para 2.

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relation to cases pertaining to the ordinary jurisdiction of EU member countries. 82. Exclusive Jurisdiction in the EU Brussels System Another question arises as to whether forum necessitatis also applies to cases falling within the Brussels system’s exclusive jurisdiction provisions. The answer to this question should be in the affirmative for the following reasons. The first refers to all the reasons in favor of the adoption of forum necessitatis within the framework of the Brussels system, as that reasoning applies, mutatis mutandis, even when ordinary jurisdiction belongs exclusively to a court outside of the forum State. The second argument recognizes that exclusive jurisdiction provisions can easily lead to the denial of justice, and consequently emphasizes that their presence further obliges the adoption of forum necessitatis. For example, bringing a case before the courts of a member State that, according to the Brussels System are exclusively competent with respect to this case, may be impossible for the plaintiff, with the consequence that if no other forum has jurisdiction to examine the case, the plaintiff suffers a denial of justice69. The third argument emphasizes that, save the just cited thesis, which maintains that exclusive jurisdiction provisions render the adoption of forum necessitatis all the more necessary, none of the other studies here examined address the exclusive jurisdiction provisions separately from all other international jurisdiction norms as far as forum necessitatis is concerned. Thus, the conclusions reached with respect to the latter, to the effect that forum necessitatis must be adopted even within the framework of the Brussels system, should also apply with respect to the former, thereby establishing that jurisdiction by necessity must be exercised within the framework of the Brussels system even in cases falling within their exclusive jurisdiction provisions. The fourth argument is based on the thesis proposed here, which asserts that exclusive jurisdiction provisions are contrary to public international law; as such, they should be overruled from a de lege ferenda perspective, whereas from a de lege lata perspective these rules cannot derogate from or prevail over the rule of forum necessitatis.

69

See the previous remarks.

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II. The Fundamental Human Right of Access to Courts II. The Fundamental Human Right of Access to Courts 83. Origin and Nature Public international law grants, to both aliens and citizens alike, the fundamental human right of access to courts70. Among the universal international norms regarding the right of access to a court are: Article 8 of the Universal Declaration of Human Rights, adopted on 10 December 1948, by the General Assembly of the United Nations and Article 2(3) of the International Covenant of Civil and Political Rights, adopted by the same General Assembly on 16 December 196671. Among the regional international norms regarding the right of access to courts are: Article 6(1) of the ECHR and Article 8 of the American Convention on Human Rights, adopted at San José, Costa Rica on 22 November 1969 72. With respect to the European Union, the right of access to courts is granted by Article 47 of the Charter of Fundamental Rights of the European Union, adopted at Nice on 7 December 2000 (Charter of Nice), which is referenced by Article 6(1) of the Treaty of Lisbon amending the Treaty on European Union and the Treaty establishing the European Community, signed at Lisbon, 13 December 200773. According to that treaty, “[t]he Union recognizes the rights, freedoms and principles set out in the Charter of Fundamental Rights of the European Union of 7 December 2000, as adapted at Strasbourg, on 12 December 2007, which shall have the same legal value as the Treaties”74. Additionally, Article 6(3) of the same Treaty states that “[f]undamental rights, as guaranteed by the European Convention for the Protection of Human Rights and Fundamental Freedoms and as they result from the constitutional traditions common to the Member States shall constitute general principles of the Union’s law”75. Finally, according to Article 6(2) of the Lisbon Treaty on the European Union “the Union shall accede to the European Convention for the Protection of the Human Rights and Fundamental Freedoms”76. The fundamental right of access to courts is domestically established by several EU member states, namely, Austria, Finland, Germany, Italy, Spain, and The Netherlands77. This right is also domestically established by several 70

See the doctrine referred to with respect to the exorbitant jurisdiction at para 1. Francioni (n 1 Chapter VI) 24. 72 Ibid. 73 Treaty of Lisbon (n 123 Chapter I). 74 Ibid. 75 Ibid. 76 Ibid. See Protocol relating to Article 6(2) on the Treaty on the European Union on the accession of the Union to the European Convention from the Protection of the Human Rights and Fundamental Freedoms [2007] OJ C306/01 at 155. 77 See Constitution Finder accessed 30 November 2011. 71

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States that are not members of the EU, namely, Australia, Brazil, Canada, Colombia, Japan, Mexico, Russia, South Africa, Switzerland, and Turkey78. Furthermore, although “US law does not endorse an explicit general right of access to court[s]”79, such a right constitutes the “European equivalent of the American constitutional guarantee of due process”80, and can be found “indirectly in two other doctrines”81, namely, jurisdiction by necessity and the duty of courts to exercise the jurisdiction they have been given by the legislature. The proceeding remarks relate, in particular, to the fundamental human right of access to courts as established by Article 6 of the ECHR and as interpreted by the ECtHR inter alia because of its place within the European Convention of Human Rights, which is considered to be the most advanced international system for the protection of fundamental human rights. According to Article 6 of the ECHR, “in the determination of his civil rights and obligations [...] everyone is entitled to a fair and public hearing within a reasonable time by an independent and impartial tribunal established by law”82. Thus, Article 6 does not expressly guarantee the right of access to courts. However, decisions of the ECtHR have established that the denial of access to domestic courts can amount to a breach of Article 683. From a primary law coordination of norms and hierarchical perspective, the question arises as to whether Article 6 of the ECHR gives rise to a general principle of international or European law (hereinafter: general principle of law). The answer to this question is yes for the following reasons. First, the characterization of the fundamental human rights established by the ECHR and emanating from the shared constitutional traditions of the Member States, such as the right of access to courts, as a general principle of EU law is explicitly rendered by Article 6(3) TEU and by relevant ECJ case law. Second, the right of access to courts can be characterized as a general principle of public international law, mutatis mutandis, for the same reasons, according to which forum necessitatis is also a general principle of law. Third as a general 78

Ibid. Michaels, ‘Two Paradigms of Jurisdiction’ (n 77 Chapter I) 1053. 80 Guinchard (n 45 Chapter I 199. See also Nuyts, ‘Due Process’ (n 79 Chapter I) 157; Michaels, ‘Two Paradigms of Jurisdiction’ (n 77 Chapter I) 1054. 81 Michaels, ‘Two Paradigms of Jurisdiction’ (n 77 Chapter I) 1053. 82 European Convention for the Protection of Human Rights and Fundamental Freedoms (entered into force 3 September 1953) 213 UNTS 222, as amended by Protocols Nos. 3,5,8, and 11 (entered into force 21 September 1970, 20 December 1971, 1 January 1990 and 1 November 1998 respectively). 83 The first decision was taken by the ECtHR in Golder v United Kingdom no 4451/70 (ECtHR, 21 February 1975) pars 28 and 31. See David Harris, Michael O’Boyle, Edward Bates and Carla Buckley, Harris, O’Boyle & Warbrick: Law of the European Convention on Human Rights (2nd edn, Oxford, OUP 2009) 235, according to whom this decision was “one of the most creative steps taken by the European Court in its interpretation of any article of the Convention”. 79

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principle of public international law and of EU law, the right of access to courts has a direct effect and prevails over domestic rules, EU secondary norms, and international conventions84. From a content perspective, Article 6 of the ECHR imposes on its Member States a non-horizontal, positive, and procedural obligation of result85. This obligation is non-horizontal because it does not aim at protecting the rightsholder against interference by another private party, but rather from interference by the State itself86. It is positive because it does not require States to “refrain from acting”87 but rather requires that they take positive actions to facilitate the fundamental human right of access to courts. The obligation is procedural because it operates at the procedural level, rather than at the substantive level, of adjudication88. Finally, this obligation is an obligation of result because it imposes on Member States the duty to immediately facilitate the right of access to courts, as opposed to simply requiring that they help avoid a violation of the right (i.e., due diligence obligation), or set up an internal system capable of realizing the right within a prescribed amount of time (i.e., programmatic obligation)89. Also, the fundamental human right of access to courts goes to the core of fundamental human rights, which have a universal nature as opposed to a purely regional character90. Finally, Article 6 applies with respect to proceedings related to “civil rights and obligations”91, but, according to the jurisprudence of the ECtHR, “the concept of ‘civil rights and obligations’ cannot be interpreted solely by reference to the domestic law of the respondent State, but must be given an autonomous interpretation in the light of the object and purpose of the Convention”92. Certain questions then arise relating to the characterization of the category civil right under Article 6 of the ECHR.

84 See supra, the remarks rendered with regard to the forum necessitatis as a general principle of law. 85 Cordula Dröge, ‘Positive Verpflichtungen der Staaten in der Europäischen Menschenrechtskonvention’ [2003] Beiträge zum ausländischen öffentlichen Recht und Völkerrecht 159, 380, available at accessed 30 November 2011. 86 Ibid 381. 87 Ibid 380. 88 Ibid 383. 89 Ibid 388. 90 Arnold (n 283 Chapter I). 91 European Convention for the Protection of Human Rights and Fundamental Freedoms (n 82 Chapter VI). 92 Council of Europe (1991) 34 Yearbook of the European Convention on Human Rights 48.

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84. Characterisation The first question that arises is whether the characterization of the notion of civil rights under Article 6 ECHR should be made only with respect to the forum’s substantive law, or if it should also be made according to foreign laws made applicable by virtue of relevant private international law provisions. According to one thesis, reference should only be made to the domestic law of the forum State93. This thesis finds its basis in the jurisprudence of the ECtHR, according to which “[w]hether or not a right is to be regarded as civil within the meaning of this expression in the Convention must be determined by reference to the substantive content and effects of the right – and not its legal classification – under the domestic law of the State concerned”94. This thesis, however, is unpersuasive for the following reasons. First, the ECtHR jurisprudence just mentioned was proffered in a purely domestic case that did not pose the question of whether a right could be considered as civil by reference to a foreign law. Second, a literal interpretation of the relevant jurisprudence highlights that it not only refers to the “substantive” law of the State concerned, but to its “domestic” law in general, which includes the State’s private international law rules, which may themselves reference foreign law. Third, according to recent ECtHR jurisprudence, the terms “domestic law” and “internal legal order” are synonymous with the notion of “the juridical order of the contracting States”95. Therefore: “it is possible to interpret this reference as referring to the ‘juridical system at stake,’ as much as, to say it differently, the legal system applicable to the claim, being it relevant or not in light of the ECHR. The lex causae can pertain to a juridical system internal or external to the ECHR. Thus, the source of the claimed right is not relevant; the important thing is that it is granted by an internal system of whatever nature”96. Fourth, Article 6 has already been applied by the ECtHR in international cases where a right was regarded as “civil” by reference to laws distinct from those of the forum State97. Fifth, the alternative thesis advanced here extends the scope of Article 6, and is thus in line with the obligation of member States to interpret ECHR norms in an extensive way. 93 See the references in Jean Claude Soyer and Michele de Salvia, ‘Sub Article 6 ECHR’ in Louis-Edmond Pettiti, Emmanuel Decaux and Pierre-Henri Imbert (eds), La Convention européenne des droits de l'homme. Commentaire article par article (Paris, Economica 1995) 250. 94 König v Federal Republic of Germany no 6232/73 (ECtHR, 28 June 1978) para 89. 95 Marchadier (n 45 Chapter I) 51–52. 96 “Il est alors possible d’interpréter cette référence comme visant ‘le système juridique en cause,’ soit, en d’autre termes, l’ordre juridique applicable à la cause, qu’il relève ou non de la CEDH. La lex causae peut émaner d’un ordre juridique tant interne qu’externe à la Convention. Ainsi, peu importe la source du droit revendiqué, l’essentiel est qu’il trouve un fondement dans un ordre juridique interne quelconque” (ibid 52–53). 97 Ibid 62.

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85. Civil Proceedings A second question that arises is whether the administrative proceedings related to the granting of registered IPRs fall within the category of proceedings related to civil rights. Note that this question does not relate to unregistered IPRs, since those rights come into being without condition of formalities and therefore without administrative proceedings. According to the Human Rights Commission, while “[t]here is no doubt that patent rights, once granted, must be considered as civil rights within the meaning of Article 6(1)[,]”98 this Article does not encompass proceedings between private persons and administrative organs related to “the registration of patents”99. In fact, those proceedings: “do[] not concern [...] the legal relationship between private persons, but the objective right of an inventor vis-à-vis the Administration to be granted a patent if he has fulfilled the necessary material and formal conditions. It is evident that the law provides that other private persons may file objections against the registration of a patent in a given case [...]. But it is also true that these objections are limited to arguments that the objective conditions of registration are not fulfilled”100. Thus, “under these circumstances the registration of patents must be considered as an essentially administrative matter which is outside the scope of Article 6 of the Convention” 101. As a matter of fact, however, this jurisprudence has been overruled by subsequent case law related to patents and designs. As for patents, the ECtHR has established that “the patent application proceedings [...] concern ‘the determination of civil rights and obligations’” and therefore fall within the scope of Article 6 of the ECHR102. As for designs, the European Commission has established that an administrative proceeding “decisive for the registration of the applicant's design [is] [...] comparable to that of a patent [and] [...] there-

98

X v Austria no 7830/70 (ECtHR 1978) para 201. Ibid para 202. 100 Ibid para 201. 101 Ibid. See also X v Switzerland no 8000/77 (ECtHR, 9 May 1978). 102 British-American Tobacco Co. v Netherlands no 19589/92 (ECtHR, 20 November 1995) para 67. However, as regards the right to be heard, which is also based on Article 6 ECHR, the more recent Strasbourg jurisprudence does not analyze whether the EPO proceeding at stake infringes this right but limits itself to state that “the European Patent Convention provides for equivalent protection as regards the Convention.” Rambus Inc. v Germany no 40382/04 (ECtHR, 16 June 2009) para 2 (citing Lenzing AG v Germany no 39025/97 (ECtHR, 9 September 1999). On these decisions and the Lenzing case also before the European Strasbourg Court and the German Constitutional Court, see Jochen Pagenberg, ‘The ECJ on the Draft Agreement for a European Community Patent Court – Hearing of May 18, 2010’ [2010] IIC 695. This jurisprudence is therefore grounded on the principle of equivalence and is questionable for all the reasons that will be analyzed in the last paragraph of this chapter. See also ibid for critical terms. 99

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fore [...] involve[s] a determination of ‘civil rights’ within the meaning of Article 6”103. This new ECtHR case law is convincing and may be extended to all other registered IPRs for the following reasons. First, in the Budweiser decision of 2007, the ECtHR recognized that “an applicant for the registration of a trade mark [...] owned a set of proprietary rights [...] even though they can be revoked under certain conditions”104. This decision supports the thesis that is related to patents but which is also reasonably extendable to any IPRs and according to which “there should be no doubt that the applicant for a patent, as well as the patentee who seeks to have his revoked patent reinstated are both protected under Article 6 (1) ECHR”105. Second, in regard to patents within the various patent systems “the applicant is already presumed to be the owner of the invention, regardless of its patentability”106. Third, in regards to any IPRs, ECtHR jurisprudence generally incorporates within the notion of civil rights and obligations all disputes between private persons and the State that do not concern the execution of sovereign powers, and since as already mentioned, IPRs are not an expression of the sovereignty of their granting States, proceedings in respect thereto do not involve sovereign powers. 86. Restrictions of the Right of Access to Courts The right of access to courts is not an absolute right. In fact, certain restrictions on this right “are permitted by implication since the right of access by its very nature calls for regulation by the State”107. Consequently, States may establish such regulations in accordance with a certain “margin of appreciation”108 of the “needs and resources of the community and of individuals”109. However, these limitations fall within the purview of the ECtHR’s oversight and control. Thus, in verifying the legal character of such regulations, the jurisprudence of the ECtHR is authoritative, and a review thereof reveals that restrictions on the right of access to courts must be established by law, must have a legitimate aim, and must respond to the principle of proportionality.

103

Denev v Sweden no 25419/94 (ECtHR, 9 April 1997). Anheuser-Busch (n 103 Chapter IV) para 78. See also Smith Kline (n 103 Chapter IV); Melnychuk (n 103 Chapter IV); Balan (n 103 Chapter IV). 105 Catarina Holtz, Due Process for Industrial Property: European Patenting under Human Rights Control (Handelshogskolan i Stockholm, Rattsveternskapliga institutionen 2003) 132. 106 Ibid 131. 107 Fogarty v United Kingdom no 37112/97 (ECtHR, 21 November 2001) para 33. 108 Ibid para 33. 109 Golder (n 83 Chapter VI) para 38. 104

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As for the establishment by law requirement, restrictions must “have some basis in domestic law”110, be it of a statutory or a case law nature111, and have some internal or international origin112. Furthermore, the laws establishing the restrictions must have a certain “quality”113, that is, they must be “accessible to the person concerned”114, “compatible with the rule of law”115, “consistent, clear and precise [and] [...] foreseeab[le]”116. As for the requirement of a legitimate aim, among the aims the ECtHR has considered legitimate are “advantages for the individual concerned”117, advantages “for the administration of justice”118, compliance with public international law, and cooperation between legal systems119. With regard to the proportionality requirement, the jurisprudence of the ECtHR maintains that restrictions on the right of access are proportionate where they realize a fair balance between the limits to the right of access to courts and the aim sought to be achieved by the restrictions 120. In establishing whether this balance exists, member States possess a margin of appreciation. However, this margin of appreciation is subject to the control of the ECtHR in several respects. First, in determining whether the State has exceeded its margin of appreciation, the ECtHR examines the limitation applied to see if it impairs the very essence of the right of access to courts. Additionally, the ECtHR adopts a restrictive method of interpretation that favors the right of access. In fact, according to the ECtHR, the “right of access to the courts [holds] [...] prominent place [...] in a democratic society”121. This conclusion is in line 110

Kruslin v France no 11801/85 (ECtHR, 24 April 1990) para 27. Association Ekin v France no 39288/98 (ECtHR, 17 July 2001) para 46, according to which “the concept of ‘law’ must be understood in its ‘substantive’ sense, not its ‘formal’ one. It therefore includes everything that goes to make up the written law, including enactments of lower rank than statutes”. 112 Marchadier (n 45 Chapter I) 62, 133. 113 Kruslin (n 110 Chapter VI) para 27. 114 Ibid. 115 Ibid. 116 Ekin (n 111 Chapter VI) para 46. See also De Geouffre de la Pradelle v France no 12964/87 (ECtHR, 12 December 1992) para 35, according to which the rule of law should be “sufficiently coherent and clear”. 117 Deweer v Belgium no 6903/75 (ECtHR, 27 February 1980) para 49; Acquaviva v France no 19248/91 (ECtHR, 21 November 1995) para 66, “secure the interests of the defen[s]e”. 118 Deweer (n 111 Chapter VI) para 49. On the sound administration of justice see Marchadier (n 45 Chapter I) 145; Luigi Mari, ‘Equo Processo e Competenza in Materia Contrattuale’ in Bariatti and Venturini (n 304 Chapter I) 679. 119 Marchadier (n 45 Chapter I) 145. 120 On the proportionality requirement as a general principle of international public law see Enzo Cannizzaro, Il Principio della Proporzionalità nell'ordinamento Internazionale (Milan, Giuffrè 2000); Ryngaert (n 38 Chapter I) 158 footnote 11. 121 Airey v Ireland no 6289/73 (ECtHR, 9 October 1979) para 24. 111

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with the need to extensively interpret the right of access to courts, especially when the right to be adjudicated by the petitioned court is also a fundamental human right, as is the case with IPRs. 87. Restrictions Imposed by International Jurisdiction Rules Within this framework, one question that arises is whether a Member State of the ECHR is in breach of Article 6 when the State’s courts refuse to try a case on the grounds that they do not have international jurisdiction according to the relevant applicable international jurisdiction rules122. The ECtHR has answered this question on several occasions, maintaining that these rules can in principle violate Article 6 of the ECHR. However, the ECtHR has also invoked certain “peculiarities” or circumstances to deny that a breach of Article 6 ECHR occurred. These conclusions seem to be based on dubious grounds of a political nature. Indeed, the following pages do not expose the numerous arguments that can be raised in opposition to the solutions adopted by the ECtHR in such cases, but rather present a systematic reconstruction of the principles that have been emphasized by the ECtHR and that are relevant to demonstrate that the exclusive jurisdiction rules go against the right of access to a court123. In the first case, the applicant, a dual Turkish and German citizen, petitioned an Iraqi Bank before a German Court for breach of contract124. The German Court proceeded to ascertain whether the case was sufficiently linked to Germany by reason of the plaintiff’s nationality, to confer jurisdiction to hear the case. However, according to Germany’s domestic rules on international civil procedure, such a link was not sufficient to find German jurisdiction. Thus, the German Court determined that it lacked jurisdiction to hear the case. The applicant, then, asked the ECtHR to assess whether the German Court’s failure to find jurisdiction infringed his fundamental human right of access to courts. The ECtHR responded that the right of access to a court “does not imply an unlimited right to choose the competent tribunal. The international private law rules that limit the party autonomy relevance are not incompatible as such to Article 6 § 1 of the Convention”125. However, these rules on international jurisdiction must not be arbitrary, but rather must be es122

Fawcett, ‘The Impact of Article 6(1)’ (n 45 Chapter I) 3. With respect to exclusive jurisdiction rules it seems that a systematic reconstruction of the ECtHR jurisprudence is currently still absent in the legal writings. However, on the general incompatibility of the exclusive jurisdiction rules and the right of access to courts see Fernández Arroyo, ‘Compétence exclusive’ (n 45 Chapter I) 74. 124 Bayrak v Germany no 27937/95 (ECtHR, 20 December 2001). 125 “[N]'implique pas un droit illimité de choisir le tribunal compétent. Les règles du droit international privé limitant le libre jeu de l'autonomie de la volonté ne sont pas incompatibles avec l'article 6 § 1 de la Convention”, (ibid) para 2. 123

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tablished by law. The court found that these conditions were met, since “in the concrete case, having deeply examined the case the German Courts concluded that they did not have jurisdiction over it. They have deeply grounded their decision. The reasons indicated by the German Courts and criticized by the applicant exclude that these Courts have come up with arbitrary conclusions attempting to the equitableness of the proceeding at stake”126. Thus, the court concluded that the German Court’s declining of jurisdiction had not improperly restricted the applicant’s fundamental human right of access to courts. In the second case, Hans-Adam II v Germany, the applicant, Prince HansAdam II of Liechtenstein, brought a proceeding before the Cologne Regional Court against the municipality of Cologne after he learned that the municipality of Cologne obtained a certain painting as a temporary loan from the Czech Republic. In this suit, he maintained that his late father was the true owner of the loaned painting and that it had been illegally confiscated from his father by the government of the former Czechoslovakia in 1946127. The applicant requested that the municipality of Cologne deliver the painting to him, as his father’s heir128. The German Court considered whether the case was sufficiently linked to Germany for it to hear the case, given that the painting was in German territory and that the defendant was a German municipality129. Here however, Chapter 6, Article 3, of the Convention on the Settlement of Matters Arising Out of the War and Occupation, “excluded any review, by German Courts, of measures carried out with regard to German external assets or other property, seized for the purpose of reparation or restitution, or as a result of the State of war”130. In the case in question, the former government of Czechoslovakia had confiscated the painting in 1946 as a measure against a German citizen as reparation for war damages131. Thus, the German Court declined its jurisdiction132. The applicant then asked the ECtHR to assess whether this declining of jurisdiction infringed his fundamental human right of access to courts133. The ECtHR emphasized that Member States are responsible for a violation of Article 6 of the ECHR even where they “limit the ap126 “En l'espèce, les tribunaux allemands ont conclu, après un examen approfondi, à l’absence de leur compétence. Ils ont amplement motivé leurs décisions. Les motifs fournis dans les décisions judiciaires critiquées par le requérant permettent d'exclure que les juges aient tiré des conclusions de caractère arbitraire de nature à porter atteinte à l'équité de la procédure” (ibid) para 2. 127 Hans-Adam II v Germany no 42527/98 (ECtHR, 12 July 2001) paras 10–16. 128 Ibid para 15. 129 Ibid para 16. 130 Ibid para 61. 131 Ibid para 11. 132 Ibid para 51. 133 Ibid para 52.

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plicant’s right of access to a Court in order to give effect to the rules of an international agreement excluding [their] jurisdiction”134. In the case before it, the Court determined that the restriction on the applicant’s right of access to the German Court had a legitimate aim, since it was “a consequence of the particular status of Germany under public international law after the Second World War”135, and that it aimed at realizing “the vital public interest in regaining sovereignty and unifying Germany”136. Moreover, the restriction on the applicant’s right of access to the German Court was proportionate to the aim thereby pursued. In fact, notwithstanding that the ECtHR’s previous jurisprudence had established that the proportionality requirement was met only where “reasonable alternative means [...] to protect effectively the rights under the Convention” existed137, the court found that the case before it presented “peculiarities”, such as “the particular status of the Federal Republic of Germany under public international law after the Second World War”138, that excluded the application of such jurisprudence139. Thus, the restriction on the applicant’s right of access to courts, as imposed by the Convention on the Settlement of Matters Arising Out of the War and Occupation, met the proportionality requirement, even in the absence of other reasonable means of effective recourse. The Court concluded, then, that the declining of jurisdiction by the German Court had not improperly restricted the applicant’s right of access to courts140. In a third series of cases, the ECtHR dealt with rules regarding immunity from jurisdiction of States and International Organization. With regard to the immunity from jurisdiction of States, most of the cases addressed by the ECtHR concern tort claims related either to employment in a foreign diplomatic mission141 or to personal injuries sustained from “State” acts amounting to torture142. In both of these categories of cases, the Court pays particular attention as to whether the State immunity rules involved not only had a legitimate aim but whether they were also proportional to that aim. As for the requirement of legitimate aim, the court has established that “the grant of sovereign immunity to a State in civil proceedings pursues the legitimate aim of complying with international law to promote comity and good relations between

134

Ibid. Ibid para 59. 136 Ibid para 69. 137 Ibid para 48. 138 Ibid para 68. 139 Ibid para 37. 140 Ibid para 69. 141 Fogarty (n 107 Chapter VI). 142 Al-Adsani v United Kingdom no 35763/97 (ECtHR, 21 November 2001); McElhinney v Ireland no 31253/96 (ECtHR, 21 November 2001). 135

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States through the respect of another State’s sovereignty”143. As for the requisite degree of proportionality, the court has maintained that “measures taken by a High Contracting Party which reflect generally recogni[z]ed rules of public international law on State immunity cannot in principle be regarded as imposing a disproportionate restriction on the right of access to Court as embodied in Article 6 § 1”144. With regard to immunity from jurisdiction of International Organization the most relevant case is Waite v Germany145. In this case, the plaintiffs were two British citizens residing in Germany, who were employed by a British Company and placed at the disposal of the European Space Agency (ESA) to perform services at the European Space Operations Center in Germany146. The applicants, after having been informed that their employment with the British Company would soon be terminated, instituted proceedings before a German Labor Court against the ESA “arguing that, pursuant to the German Provision of Labor (Temporary Staff) Act (Arbeitnehmerüberlassungsgesetz), they had acquired the status of employees of the ESA”147. The ESA replied that its immunity impeded the exercise of jurisdiction by the German Courts148. The German Courts agreed, determining that the ESA had validly relied on its immunity, and consequently declined to assert jurisdiction over the applicants’ claims149. The applicants then asked the ECtHR to assess whether this declining of jurisdiction infringed their fundamental human right of access to courts150. The ECtHR, in turn, verified whether the restriction placed on the applicants’ right of access to the German Court pursued a legitimate aim and was proportionate, stating, with regard to the requirement for legitimate aim: “the attribution of privileges and immunities to international organi[z]ation is an essential means of ensuring the proper functioning of such organi[z]ation free from unilateral interference by individual governments. The immunity from jurisdiction commonly accorded by States to international organi[z]ation under the organi[z]ation constituent instruments or 143 Al-Adsani (n 142 Chapter VI) para 54. This conclusion is highly criticized, see Harris, O’Boyle and Warbrick (n 83 Chapter VI) 243 footnote 170. 144 McElhinney (n 142 Chapter VI) para 37; Al-Adsani (n 142 Chapter VI) para 54. See recently Cudak v Lithuania no 15869/02 (ECtHR, 23 March 2010); Sabeh El Leil v France no 34869/05 (ECtHR, 29 June 2011). On those cases see Gilles Cuniberti, ‘ECHR Finds Immunity Violates Right to Access to Court’ Conflictsoflaws.net (3 October 2011) available at accessed 30 November 2011. 145 Waite v Germany no 26083/94 (ECtHR, 18 February 1999). See also Beer and Regan v Germany no 28934/95 (ECtHR, 18 February 1999). 146 Waite (n 145 Chapter VI) paras 11–13. 147 Ibid para 15. 148 Ibid para 17. 149 Ibid paras 17–26. 150 Ibid para 43.

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supplementary agreements is a long-standing practice established in the interest of the good working of these organi[z]ations. The importance of this practice is enhanced by a trend towards extending and strengthening international cooperation in all domains of modern society”151. Thus, “the rule of immunity from jurisdiction, which the German Courts applied to ESA in the present case, has a legitimate objective”152. Likewise with regard to proportionality, the Court stated that, on the one hand, this requirement had to be verified both “in light of the concrete circumstances of the case”153 and “in view of the prominent place held in a democratic society by the right to a fair trial”154, and on the other hand, that the following two factors were relevant to determine the proportionality of the restrictions at issue. First, “the applicants [must have] [...] had available to them reasonable alternative means to protect [...] their rights under the Convention”155. Second, these means must have been “effective”156. In the case before it, the Court verified that “the ESA Convention, together with its Annex I, expressly provides for various modes of settlement of private-law disputes, in staff matters as well as in other litigation [...]. Since the applicants argued an employment relationship with ESA, they could and should have had recourse to the ESA Appeals Board”157. However, since the applicants invoked rights that were established by German substantive labor law and not by the ESA, its dispute settlement bodies probably would have dismissed their recourse, thus providing them with an ineffective adjudication alternative. Nonetheless, according to the court, it was possible to presume that recourse to another effective tribunal existed in the case at hand since all legal systems, and thus also the German one, are “in principle open to temporary workers to seek redress from the firms that have employed them and hired them out. Relying on general labor [sic] regulations or, more particularly, on the German Provision of Labor [sic] (Temporary Staff) Act, temporary workers can file claims in damages against such firms”158. Thus, the court concluded that the German Court’s declining of jurisdiction by reason of the ESA’s immunity did not improperly restrict the applicants’ right of access to a court159. To summarize, a domestic court must adjudicate a case, even where it would not generally do so according to its international procedure norms, when its declining of jurisdiction would violate the right of access to a court. 151

Ibid para 63. Ibid. 153 Ibid para 64. 154 Ibid para 67. 155 Ibid para 68. 156 Ibid. 157 Ibid para 69. 158 Ibid para 70. 159 Ibid para 73. 152

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Also, Article 6 of the ECHR obliges member States, in principle, to grant access to their courts whenever a case is sufficiently and not fortuitously linked to the forum State160. In contrast, Member States can restrict the right of access to their courts when each of the following four requirements is met. First, the restrictions are established by law (whether of a domestic or an international origin, and whether of a case law or a statutory nature), and the law is sufficiently clear. Second, the restrictions pursue a legitimate aim, which according to the ECtHR is only the case when the restrictions comply with public international law161. Third, the restrictions are proportionate to the aim pursued; according to the ECtHR, restrictions are proportionate when they pertain to cases involving the immunity of subjects, or present peculiarities such as “the particular status of the Federal Republic of Germany under public international law after the Second World War”162. In contrast, restrictions are not proportionate when they impair in its essence the right of access to courts. Fourth, the applicant can protect his or her rights through the use of other reasonable and effective alternative means of recourse. 88. Alternative Means of Recourse in the Forum State rather than in Third States Particularly with respect to the last requirement, i.e., the existence of (reasonable) alternative means of recourse, another question arises: whether this requirement should be read as an alternative means in a third State or in an international organization (hereafter third States and international organization will be jointly referred to as third States), or whether it should be interpreted as requiring alternative means within the forum/defendant (hereafter defendant) State before the ECtHR that declines jurisdiction. According to the part of the ECtHR’s Waite and Kennedy decision that established that the existence of (reasonable) alternative means of recourse should be read as an alternative means of recourse in either a third State or third legal system, rather than in the defendant State, this requirement is met when alternative means exist in a third State, rather than within the defendant State. So a first thesis maintains that this conclusion takes into account the plurality of legal systems, is a consequence of the coordination purpose proper of private international law, and therefore “appears particularly welcomed 160

See Mari (n 118 Chapter VI) 678. See also supra; Bayrak (n 124 Chapter VI); and Hans-Adam II (n 127 Chapter VI). See also the dissenting opinion of Judge Rozakis in McElhinney (n 142 Chapter VI). On this dissenting opinion see infra. 161 In fact, examination of the European case law manifests that the aim of the sound administration of justice is relevant only with respect to internal rules of competence in pure internal cases. See also Mari (n 118 Chapter VI) 678. 162 Hans-Adam II (n 127 Chapter VI) para 59.

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since this coordination purpose allows to take into account that the lack of competence influences the right of access to a court only temporarily, being the interested parties invited to put themselves in a better situation”163. However, this European case law, and the thesis proffered in support thereof (hereinafter: the thesis here criticized), is not persuasive for the following arguments. The first argument arises from the inconsistency of the thesis here criticized. On the one hand, it acknowledges that in international cases the interests of individuals in having access to a court are even stronger than in purely domestic cases, since “the consequences arising out of a lacking of international jurisdiction according to private international law can reveal themselves to be much more annoying for the interested party that the absence of internal competence in the internal legal order”164, and thus “the international element contributes to diminish the freedom of States to refuse to adjudicate cases”165. Yet, on the other hand, the thesis here criticized maintains that the same international character of the cases at issue allows the courts of the forum State to decline jurisdiction whenever another foreign court is competent to hear the same case. Thus, the thesis here criticized supports a conclusion that is the exact opposite of the previous conclusion that it purported to maintain. The second argument derives from a systematic stricto sensu interpretation of Article 6(1) of the ECHR and the ECHR system itself. In fact, under the thesis here criticized, when a complaint is made for a breach of the ECHR, the ECtHR is obliged to examine the complaint by reference not only to the legal system of the respondent State, but also to the systems of third-party States, which could eventually include ECHR non-member States. However: “when a complaint is made for a breach of the Convention, the complaint should be examined by the [European Court with] reference only to the legal system of the respondent State. Any defects or other problems relating to such a system cannot be remedied by reference to the legal system of any other High Contracting Party, whether neighbo[]ring to the respondent State or not. Therefore, the fact that the applicant [...] had the possibility of a judicial remedy in [another legal system] in respect of his grievance should be irrelevant to the issue before the Court, which was solely and exclusively whether the appli163 Translated into English from Marchadier (n 45 Chapter I) 165, “Apparaît particulièrement opportune puisqu’elle permet de prendre en compte le fait que l’incompétence affecte le droit d’accès au tribunal seulement de manière temporaire, les individus étant invités à mieux se pourvoir”. 164 Translated into English from Marchadier (n 45 Chapter I) 157, “Les conséquences liées au refus d’une compétence en matière de droit international privé peuvent se révéler beaucoup plus ennuyeuses pour les individus que la négation d’une compétence territoriale dans l’ordre interne”. 165 Translated into English from Marchadier (n 45 Chapter I) 156, “L’élément international contribue à réduire la liberté des Etats de refuser leur compétence”.

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cant had access to the Courts in [the defendant State] in respect of the same complaint”166. This conclusion ought to be embraced even more fervently in cases where the third-party State in question is not an ECHR member. The third argument again relies on a systematic stricto sensu interpretation of Article 6(1) of the ECHR and Article 14 of the ECHR. In fact, the thesis here criticized allows domestic courts to decline their jurisdiction whenever other means of recourse exist abroad. As aliens are probably more often involved in transnational cases than citizens, and transnational cases are more likely to be heard by foreign courts than are pure internal cases, the right of access to the forum State’s courts can be derogated more often in cases involving aliens than in cases involving citizens. Therefore, the jurisprudence of the ECtHR indirectly and de facto discriminates by reason of nationality, and thereby contradicts Article 14 of the ECHR167. The fourth argument relies on a teleological interpretation of Article 6(1) of the ECHR. The opinion here criticized allows domestic courts to decline their jurisdiction whenever other means of recourse exist abroad. Thus, this opinion restrictively interprets Article 6 by limiting its scope to cases that cannot be heard abroad. However, such an interpretation is contrary to the need to read the provisions posed by the ECHR in an extensive way. The fifth argument relies on a systematic lato sensu interpretation of Article 6(1) of the ECHR and of international jurisdiction rules in general. Here, it is necessary to distinguish international jurisdiction rules of an internal or domestic nature from those imposed by international conventions. The former types of rules allocate international jurisdiction to the courts of the forum State without considering whether other foreign courts are competent to hear the same case, and, as such, have a unilateral, rather than a bilateral, character. The opinion here criticized, however, imposes on the petitioned courts seized the duty to also take into account the international jurisdiction of foreign courts, and as such is contrary to the nature of these rules. With respect to the international jurisdiction norms of a conventional origin, the result is at least partially the same. These rules allocate international jurisdiction to the courts of a member State, this time while taking into account whether or not other foreign courts are competent to hear the same case, and as such have a bilateral nature. However, these rules do not consider the international jurisdiction provisions of non-member States; and therefore, have a unilateral na166

See the Dissenting Opinion of Judge Loukis Loucaides in McElhinney (n 142 Chapter VI), according to whom “I think it is unfair as well as odd to expect the applicant to have recourse to another State as a solution to his problem of lack of access to a court in his own country, against which his complaint was directed”. 167 On the violation of Article14 ECHR realized by way of indirect discriminations see Oddný Mjöll Arnardóttir, Equality and Non-discrimination Under the European Convention on Human Rights (Leiden, Martinus Nijhoff 2003) 73.

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ture when examined not with respect to the sole systems of their member States, but in relation to the entire international framework. Thus, this thesis is also contrary to the nature and scope of the internationally derived international jurisdiction rules, at least with respect to third States. The sixth argument also relies on a systematic lato sensu interpretation of Article 6(1) of the ECHR, and international jurisdiction rules. The thesis here criticized cites the aim of coordinating the proceedings that are proper to international jurisdiction rules. Yet the right of access to a court, as set forth in Article 6 of the ECHR, is a fundamental human right. Thus, the aim of coordinating proceedings cannot prevail over the fundamental human right of access to a court. This conclusion can be reached even when the international jurisdiction rules are established by international conventions. In this respect, this conclusion is in line with the jurisprudence of the ECtHR, according to which ECHR member States are responsible for violating ECHR Article 6 even when they limit the applicant’s right of access to a court in order to give effect to the rules of an international agreement. The seventh argument is based on opportunity reasons. The thesis here criticized imposes on the forum State’s court a duty to establish, before they decline jurisdiction, whether the case at hand can be adjudicated effectively by foreign State courts. However, forum State courts apply their own domestic rules of international civil procedure, which do not establish the international jurisdiction of foreign State courts. Thus, to verify that other foreign courts have the requisite international jurisdiction to hear a case, the forum State’s court must verify the domestic rules on international jurisdiction for every legal system in the world. Opportunity reasons, then, suggest exempting domestic courts from performing such a difficult or impossible task, and instead requiring only that those courts verify if other reasonable means of recourse are available within their forum State, according to their own international jurisdiction rules. The eighth argument is based on the dissenting opinion of Judge Rozakis in the McElhinney case168. The dissent referenced the part of the ECtHR’s Waite and Kennedy decision that established that the existence of reasonable alternative means of recourse should be read as an alternative means of recourse in either a third State or third legal system, rather than in the defendant State169. The dissenting Judge maintained that the decision “referred to specific circumstances concerning persons working within an international organi[z]ation and labour [sic] disputes for which internal proceedings existed and were known to the applicants when they decided to become employees of the organi[z]ation[,]”170 and emphasized, in contrast, that in cases where the de168

McElhinney (n 142 Chapter VI) Judge Rozakis’ dissenting opinion. Ibid para 4. 170 Ibid. 169

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fendant is a foreign State, rather than an international organization, “the applicant did not have any [such] link with the [foreign State’s] jurisdiction [...] or any kind of allegiance and loyalty to [it]”171. The Judge thus stated that the part of the Waite and Kennedy decision concerning alternative means of recourse did not apply, and the requirement of the existence of reasonable alternative means of recourse should, accordingly, be read as alternative means within the defendant State, rather than in third States172. This opinion deserves to be approved. In summary, the requirement of the existence of reasonable alternative means of recourse cannot be read as alternative means in a third State, but must be interpreted as alternative means that allow access to the courts of the defendant State173. 89. Exclusive Jurisdiction Rules and the Right of Access to the Court Finally, the last question that arises in this context is whether the right of access to courts can be improperly restricted by international jurisdiction norms that establish exclusive jurisdiction in certain fora. The ECtHR has not yet provided an answer to this specific question. However, it is apparent that the conclusions reached with respect to all other general international jurisdiction rules apply, mutatis mutandis, to exclusive jurisdiction provisions. Furthermore, no reasons can be invoked to proscribe this application. Thus, the rules on exclusive jurisdiction violate the right of access to courts because, by their proper nature, they restrict this access when the case at hand does not enter into the exclusive jurisdiction of the forum State, although it meets all the requirements necessary to consider improper the restriction in question.

171

Ibid. Ibid, according to whom “[i]n any event, I seriously dispute an unqualified transposition of a principle that the Court applied in a specific category of case (e.g. Waite and Kennedy v. Germany)– namely the circumscribed scope of Article 6 in circumstances where a State party to the Convention has relinquished parts of its jurisdiction to an international organi[z]ation – to all cases involving a jurisdictional plurality”. 173 McElhinney (n 142 Chapter VI), Judge Loucaides’ dissenting opinion, according to whom “it is correct that Article 6 may be subject to inherent limitations, but these limitations should not affect the core of the right. Procedural conditions such as time-limits, the need for leave to appeal etc. do not affect the substance of the right. But completely preventing somebody from having his case determined by a Court, without any fault on his part and regardless of the nature of the case, contravenes, in my opinion, Article 6 § 1 of the Convention”. 172

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III. Exclusive Jurisdiction Rules are contrary to the public international law rules on the Denial of Justice and on the Fundamental Human Right of Access to Courts III. Exclusive Jurisdiction Rules 90. Exclusive Jurisdiction Rules and Denial of Justice The public international law rules on the avoidance of a denial of justice, forum necessitatis, and on the right of access to courts will now be applied to exclusive jurisdiction rules in IPR cases. To this end Voda, the UK Court of Appeal’s Lucasfilm and the ECJ judgments will be adopted as examples, because they constitute the most recent examples of jurisprudence involving the application of exclusive jurisdiction within the context of IPR cross-border litigation. Additionally, with particular reference to Article 6 of the ECHR, while it is evident that this Article does not apply to the United States, and thus, not to the Voda case, a systematic interpretation of Article 6 can influence the application of the already-examined corresponding rules on right of access to courts that are in force in the United States. Therefore, the arguments based on Article 6 can also be adopted, mutatis mutandis, with respect to the US Voda case. As for denial of justice and forum necessitatis, in the Voda case, both parties were US-domiciled companies and the controversy concerned several European, British, Canadian, French, and German patents, in addition to US patents174. Accordingly, the case was sufficiently linked to the United States, and satisfied the first connection requirement of the denial of justice/forum necessitatis rule. However, the US Court of Appeals for the Federal Circuit held that Voda was required to bring its British, Canadian, French, German, and European patent infringement claims before the respective courts of the United Kingdom, Canada, France, Germany, and each single State for which a European patent was granted, since each State was held to have exclusive jurisdiction over its patent infringement claims175. In so holding, the US Court of Appeals for the Federal Circuit required that Voda should duplicate its proceedings176. The duplication of proceedings in IPR cases has been shown to increase their costs. According to the previously mentioned study Economic-Cost Benefit Analysis of a Unified and Integrated European Patent Litigation System, “between 146 and 311 patent infringement cases are being duplicated annually in EU Member States. By 2013, this number is likely to increase to between 202 and 431 duplicated cases. Total private savings from having access to a unified patent proceeding would span the interval between EUR 148 and 174

Voda (n 31 Chapter I) 890. Ibid 898–904. 176 Ibid. 175

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289 million”177. Moreover, the costs of the duplication of proceedings are even higher where the systems involved are such as the United Kingdom one. In fact, “the average cost of pursuing through to first instance trial a patent infringement action in the UK is approximately €500,000, and this is about three times the cost of an infringement action in most other European jurisdictions”178. Furthermore, the duplication of proceedings in IPR cases can lead to divergent outcomes, as occurred in a recent series of cases involving European patents. “In the Epilady case (EP0101656), infringement suits of the patentholder were successful in Belgium, Germany, Italy and the Netherlands, but not successful in Austria, France and the United Kingdom. In Securities System Inc. vs. ECB (EP0455750), the German and Dutch Courts upheld the patent, while it was revoked in France and the UK. In the Senseo case (EP0404717), initial divergent rulings have been issued by Belgian and Dutch Courts, but several other national cases are still pending. In the Monsanto case (EP0546090), the District Court of The Hague gave an interim judgment on March 19, 2008 and referred the case to the European Court of Justice for an interpretation of Directive 98/44/EC of 6.7.1998 on the legal protection of biotechnological inventions; several parallel cases are pending in different Member States”179. Moreover, another case that exemplifies the risk of divergent outcomes due to the duplication of proceedings is the European Central Bank (ECB) v Document Security Systems Inc. (DSS) case180. To describe properly this case, it is relevant to refer to the wording of the decision rendered by the UK Court of Appeal on 19 March 2008. The controversy according to the Court was that a US company “contend[ed] that [its] patent [...] and its sister patents are infringed by euro banknotes. Imaginatively but overoptimistically it tried to bring central proceedings before the Court of First Instance of the EU. On 5th 177

Harhoff (n 214 Chapter I) 5. This study refers explicitly to the Unified Patent Court (ECPC), see infra. However, its results are extendable to any other unitary enforcement system of national and foreign patents. See also Austin, ‘Copyright Infringement’ (n 36 Chapter II) 7. 178 David Knight, ‘The Reducing Cost of European and U.K. Patent Litigation?’ Patent World (28 May 2008) available at accessed 30 November 2011. See also Heinze, ‘A Framework for International Enforcement’ (n 210 Chapter I) 57, recalling the European Commission Communication (n 115 Chapter I), according to which an average patent dispute in Germany normally costs around Euros 140,000 for two instances, the price tag is Euros 100,000 to Euros 350,000 in The Netherlands, Euros 90,000 to Euros 350,000 in France, and Euros 300,000 to Euros 2,500,000 in the United Kingdom. 179 Harhoff (n 214 Chapter I) 15 footnote 20. See also the Samsung case supra, at para 3. 180 European Central Bank v Document Security Systems Inc. [2008] EWCA (Civ) 192 available at accessed 30 November 2011.

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September 2007, that Court held, not surprisingly, it had no jurisdiction to hear patent infringement proceedings even against an EU institution, case T295/05. Meanwhile the ECB had started revocation proceedings in France, Germany, the Netherlands, Spain, Italy, Belgium, Luxembourg and Austria. These are ongoing”181. Prior to the UK Court of Appeals decision, there were several conflicting judgments coming from different jurisdictions concerning the validity of the patent182. “the German Federal Patent Court (Bundespatentgericht) did not agree with [the UK Court of First Instance decision in the case ECB v. DSS invalidating the patent and] [...] held the patent valid. Then, on 9 January 2008, the French Court (le Tribunal de Grande Instance de Paris) agreed with [the UK first instance decision] and disagreed with the German Court. On 12th March 2008 the Dutch Court agreed with the German Court. In sporting terms, the score is currently 2-2 to the ECB at first instance level. All this is deeply regrettable. It illustrates yet again the need for a onestop patent shop (with a ground floor department for first instance and a first floor department for second instance) for those who have Europe-wide businesses”183. Finally, the UK Court of Appeal dismissed the plaintiff’s appeal and confirmed the first instance decision holding the patent void184. In light of the above, requiring the plaintiff in the Voda case to address its claims to the courts of each of the foreign States where the patents had been granted was unreasonable and ineffective, and thereby met the second requirement of the denial of justice/forum necessitatis rule. In the UK Court of Appeal’s Lucasfilm case, the denial of justice was even more apparent. First, the case involved a defendant who was not only domiciled in the United Kingdom but had also perpetrated his infringing acts from the United Kingdom185. Thus, the UK Court’s declining of jurisdiction was contrary to the Brussels Regulation. According to its Article 2 provision, “persons domiciled in a Member State shall [...] be sued in the courts of that Member State”186. The defendant was domiciled in the United Kingdom; therefore, the UK Court had jurisdiction to hear the case. However, this conclusion was not reached by the UK Court of Appeal for two different reasons. First, Article 2 of the Brussels Regulation did not ground the UK Court’s jurisdiction, since it conditions its application upon the existence of not only the “personal jurisdiction”187, but also the “subject-matter jurisdiction of the court”188, which does not exist where “the wrongs [are] done outside the EU 181

Ibid 3–4. Ibid 4. 183 Ibid 3–5. 184 Ibid 52. 185 Lucasfilm Entertainment (n 29 Chapter I) 100, 103. 186 Ibid 123. 187 Ibid 127. 188 Ibid 127. 182

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by persons who happen to be domiciled within the EU”189. Second, Article 2 of the Brussels I Regulation did not ground the UK Court’s jurisdiction since the subject matter of the case at hand entered into the exclusive jurisdiction of the US Courts, which exclusive jurisdiction was purportedly established implicitly by the CUP, CUB, and TRIPs agreement, since Article 22(4) of the Brussels I Regulation on exclusive jurisdiction otherwise allegedly applicable also to copyrights was not to be applied by analogy (or "reflexively") to nonMember States IPRs like the US copyright in issue190. However, neither of the arguments adopted by the UK Court of Appeal is convincing, as it is pointed out by the UK Supreme Court’s 27 July 2011 Lucasfilm ruling that reversed the judgment below191. With respect to the first argument, on the one hand, the notions of personal jurisdiction and subject matter jurisdiction are common law concepts extraneous to the Brussels I Regulation, which conditions its general application upon the sole presence of the defendant’s domicile inside the European Union, without posing any further proximity requirements to the EU territory192. On the other hand, the Lucasfilm case presented additional connections to the EU territory, since the defendant perpetrated the infringing acts from the United Kingdom. With respect to the second argument, as we have already noted, the purported implicit exclusive jurisdiction provision in the CUP, CUB, and TRIPs agreement not only does not exist, but nevertheless it would be contrary to public international law if it did. Finally, like the UK Supreme Court’s July 27 2011 Lucasfilm ruling notes Article 22(4) of the Brussels I Regulation on exclusive jurisdiction is not applicable either to unregistered IPRs like the copyright in issue, or to registered IPRs pure infringement proceedings, where the validity issue is not raised, like the dispute before the UK Court of Appeal, albeit this last one concerned copyrights rather than registered IPRs193.

189

Ibid 129. Ibid 107–108. 191 See supra, para 3. 192 See C-1/03 Opinion, ‘Competence of the Community to Conclude the New Lugano Convention on Jurisdiction and the Recognition and Enforcement of Judgments in Civil and Commercial Matters’ [2006] ECR I-1145; Owusu (n 163 Chapter VI) paras 25–26. See also Torremans, ‘Lucasfilm v Ainsworth’ (n 29 Chapter I) 752, according to whom in the Lucasfilm case: “the dangerous consequence of the analysis put forward by the Court of Appeal is that this jurisdiction is declined and that a substantial risk is created that not a single court will be available and willing to hear the case and to do justice between the parties. The Court itself indicates that Ainsworth does no longer travel to the US and will in this way be able to escape the jurisdiction of the US courts, and in the next phase the Court of Appeal refuse to recognise and enforce the Californian judgment in the UK This kind of denial of justice is undesirable and dangerous, but it will be the inevitable consequence of the approach taken by the court”. 193 Lucasfilm Ltd & Ors v Ainsworth & Anor (n 30 Chapter I) 88-91. 190

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Additionally, even where the Brussels I Regulation was not to be applied, the UK Court’s declining of jurisdiction was contrary to forum necessitatis, since the Lucasfilm case presented a sufficient link with the United Kingdom to meet the first requirement of the denial of justice/forum necessitatis rule. Also, according to the UK Court of Appeal, the United States had exclusive jurisdiction to address the infringement of US copyrights. However, the UK Court of Appeal did not enforce the judgment rendered by the US Court in the infringement action already brought by the plaintiff in the United States. Thus, the United Kingdom’s non-enforcement of the decision of the US Court, which was the ordinary competent court according to the United Kingdom, rendered access to that US tribunal ineffective with respect to the United Kingdom. Therefore, the non-enforcement of the US judgment constituted a legal obstacle to effectively exercise the right of access to US courts. As such, in the United Kingdom it met the second requirement of the denial of justice/forum necessitatis rule. In the GAT case, both the plaintiff and defendant were companies established in Germany194. The case, therefore, was sufficiently linked with Germany to meet the first requirement of the denial of justice/forum necessitatis rule. Moreover, in the GAT case, the patents at issue were granted by a single State: France. Thus, the declining of jurisdiction by the German Court imposed by the ECJ’s GAT decision obligated the plaintiff to bring the proceeding before a French Court, which had ordinary exclusive jurisdiction to hear the validity issues of the French patents. Yet the exclusive jurisdiction of the French Court concerned the sole issue of whether the French patents were valid; it did not address their infringement. Rather, the German Court had ordinary jurisdiction to examine the infringement claims, by reason of the general jurisdiction criterion of the Brussels System, which granted jurisdiction to the country of the defendant’s domicile, here, Germany. As a result, the German Court had to stay its proceeding while it referred to the French Court the issue of the French patents’ validity, and after the French Court’s decision on the validity of the patents, the German Court had to resume the case and examine the infringement claims195. Indeed, proceeding in this manner would have produced a duplication of disputes. Thus, even the GAT case met the second requirement of the denial of justice/forum necessitatis rule.

194

GAT v LuK (n 32 Chapter I) para 8. The ECJ GAT v LuK decision (n 32 Chapter I) did not establish explicitly the necessity to proceed in this manner. However, this necessity can be gleaned from the interpretation thereof. See Explanatory Report by Professor Fausto Pocar (n 108 Chapter I) 27. See also chapter II of this book. 195

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91. Exclusive Jurisdiction Rules and the Fundamental Human Right of Access to Courts As for the fundamental right of access to courts, in the Voda case, by virtue of the exclusive jurisdiction rules purported to exist, the US Court declined to exercise jurisdiction over Voda’s infringement claims related to foreign patents. Thus, in that case, the exclusive jurisdiction rules not only impeded Voda’s access to the US Court with respect to its foreign patent infringement claims, but also restricted Voda’s fundamental human right of access to the US Courts. Furthermore, this restriction was improper for the following reasons. First, a sufficient and non-fortuitous link existed between the case and the forum State. Second, the restriction on the right of access to courts was not established by sufficiently clear law. Rather, it was grounded on implicit rules of public international law alleged to exist. Third, the restriction did not pursue a legitimate aim. Here, the purported aim was to comply with public international law, but public international law not only does not suggest implicit exclusive jurisdiction rules, but considers them contrary to its rules. Fourth, the restriction was not proportionate to the aim pursued. Here, the restriction concerned neither matters regarding immunity from jurisdiction nor cases presenting certain recognized peculiarities. The restriction also impaired in its essence the right of access to courts, since on the one hand Voda did not have other means of recourse available in the United States, and on the other hand, the means of recourse available to Voda outside the United States implied a duplication of proceedings and, therefore, were ineffective. In the UK Court of Appeal’s Lucasfilm ruling, the violation of the right of access to courts was even more apparent. There, by virtue of the purported exclusive jurisdiction of US Courts, the UK Court of Appeal declined to exercise jurisdiction over infringement claims of US copyrights. Exclusive jurisdiction rules impeded access to the UK Court, and restricted the plaintiff’s right of access to courts, as set forth in Article 6 of the ECHR. Additionally, this restriction may be considered as illegal for the following reasons. First, a sufficient and non-fortuitous link existed between the case and the forum State. Second, for the same reasons explained with respect to the Voda case, the restriction on the right of access to courts was not established by a sufficiently clear law. Third, and again for the same reasons explicated with respect to the Voda case, the restriction in issue did not pursue a legitimate aim. Fourth, the restriction on the right of access to courts was not proportionate to the aim it pursued. The plaintiff did not have other means of recourse available in the United Kingdom, but had other means of recourse available outside the United Kingdom. Thus, the plaintiff supposedly could have brought the infringement of his US copyright before a US Court. Yet the plaintiff had already availed himself of this means of recourse, obtaining a judgment from the US Courts that the UK Court refused to enforce. This action thus demon-

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strated that while, in arguendo, in conformity with the ECtHR Waite and Kennedy decision, an “alternative means of recourse” existed in a country (the United States) other than the forum State (the United Kingdom), this (allegedly) existing available alternative means of recourse was in fact ineffective. Likewise, in the GAT case, by virtue of an extensive interpretation of the exclusive jurisdiction rules posed by Article 16(4) of the Brussels Convention, the German Court had to decline its jurisdiction with respect to the validity claims of the plaintiff’s French patents. Thus, here again, the application of exclusive jurisdiction rules would have impeded access to the German Court and restricted LuK’s right of access to courts, as established in Article 6 of the ECHR. Furthermore, this restriction may also be read as illegal for the following reasons. First, a sufficient and non-fortuitous link existed between the case and Germany. Second, the restriction on the right of access to courts was not established by a sufficiently clear law. Rather, the restriction in issue was grounded in an extensive interpretation by the ECJ of Article 16(4) of the Brussels Convention that does not explicitly extend the scope of the exclusive jurisdiction rule to IPR validity issues not raised in a principal way but rather as a plea in objection. Moreover, before the GAT decision, the ECJ had highlighted the “restrictive nature of the provision contained in Article 16 (4)”196. and thus had interpreted it in a restrictive way. That interpretative treatment thus gave rise to a legitimate expectation that a restrictive interpretation was to also be adopted with respect to IPR validity issues raised as a plea in an objection, excluding them from the scope of Article 16(4). Third, for the same reasons explicated with respect to the Voda case, the restriction at issue did not pursue a legitimate aim. Fourth, the restriction was not proportionate to the aim pursued. LuK did not have other means of recourse available in Germany, and while other means of recourse were available to LuK outside Germany, the utilization of those means produced a duplication of proceedings that thereby made them ineffective197. 92. Solutions of a PIL and Human Rights Nature In the Voda, UK Court of Appeal’s Lucasfilm, and GAT rulings, then, the rules on exclusive jurisdiction resulted in denial of justice to the respective IPR owners, violating forum necessitatis and the fundamental human right of 196

Duijnstee (n 51 Chapter I) para 23. This duplication of proceedings is different from that of certain legal systems, such as the German one, according to which the German court competent to address the IPR validity issue incidentally raised is not the same Court that is competent to examine its infringement issue. In fact, it is apparent that the former kind of duplication of proceedings requires much more “entry thresholds (such as language, distance, costs, mentality) for parties to the litigation system” than the latter one. As such see Jaeger, Hilty, Drexl and Ullrich (n 112 Chapter I) 826, referring to the ECPC on which see infra. 197

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access to courts. Since the Voda, UK Court of Appeal’s Lucasfilm, and GAT rulings, are the most recent expression of the application of exclusive jurisdiction in IPR cross-border litigation, mutatis mutandis, their conclusions may be easily extended to all other international IPR disputes. To avoid denial of justice and to safeguard the right of access to courts, States should follow three different, concurrent approaches, each of which leads to the same results. First, from a de lege ferenda perspective States must declare as unconstitutional or overrule their explicit exclusive jurisdiction provisions, and also revisit their case law according to which exclusive jurisdiction rules are implicitly suggested by public international law. Second, from a de lege lata perspective States must adopt “the private international law solution”198. (hereafter the PIL solution). According to the PIL solution, States must search for other rules of private international law that are different and prevailing over the rules that would otherwise lead to the declining of jurisdiction. Then, States must find these rules in forum necessitatis, which is a PIL rule and a general principle of law, and which therefore has a direct effect and prevails over exclusive jurisdiction rules (domestic or of the Brussels system). States must adopt this forum and thus exercise jurisdiction by necessity despite exclusive jurisdiction provisions. Third, always from a de lege lata perspective, States must adopt “the human rights solution”199. According to this solution, States must recognize the right of access to courts as a general principle of law, and in any case the ECHR primacy over the other international, European, and domestic rules on exclusive jurisdiction, such as those of the Brussels System. Then, the States must recognize that to decline jurisdiction by reason of the exclusive jurisdiction rules would constitute a breach of the ECHR by a Court. Additionally, States must refer to this violation “as the ground for not so acting”200. and therefore of not declining jurisdiction. Finally, States must exercise jurisdiction despite exclusive jurisdiction provisions. As for the PIL solution, in the Voda case, the US Court of Appeals for the Federal Circuit should have exercised its jurisdiction by necessity over all of Voda’s infringement claims, regardless of whether the patents involved were national or foreign. Likewise, in the Lucasfilm case, the UK Court of Appeal should have exercised its jurisdiction to enforce the US copyrights in issue, as was explicitly stated by the UK Supreme Court’s 27 July 2011 Lucasfilm ruling reversing the judgment below. Finally, in the GAT case, the German Court should have exercised its jurisdiction by necessity over both LuK’s French patents’ validity and infringement claims. Particularly with respect to the GAT case, the exercise of jurisdiction by necessity by the German Court over the 198

Fawcett, ‘The Impact of Article 6(1)’ (n 45 Chapter I) 37. Ibid. 200 Ibid. 199

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validity of LuK’s French patents is contrary to the ECJ’s GAT decision. However, a literal interpretation of this decision highlights that it does not address the compatibility of forum necessitatis with the exclusive jurisdiction rules of the Brussels Convention and, thus, cannot be interpreted as maintaining that the latter prevails with respect to the former. Second, a teleological interpretation of the ECJ’s GAT decision highlights that the court did not intend to speak on the compatibility of forum necessitatis and the exclusive jurisdiction rules of the Brussels Convention; thus, its decision cannot be construed in that sense. Third, allowing the German Court to exercise its jurisdiction by necessity is in line with the already-discussed finding that forum necessitatis is adoptable within the framework of the Brussels System, even in derogation of its exclusive jurisdiction provisions. Finally, even assuming, in arguendo, that the GAT decision was interpreted as implying the prevalence of the exclusive jurisdiction provisions of the Brussels System over forum necessitatis, EU member States would nonetheless be compelled to derogate from the precedent set by that ECJ case to realize the general principle of law of forum necessitatis. As for the human rights solution, the US Court of Appeals for the Federal Circuit in the Voda case should have exercised jurisdiction over all of Voda’s patent infringements claims, regardless of whether the patents involved were national or foreign; the UK Court of Appeal in the Lucasfilm case should have exercised its jurisdiction to enforce the US copyrights at issue, as was explicitly stated by the UK Supreme Court’s 27 July 2011 Lucasfilm ruling reversing the judgment below; and the German Court in the GAT case should have exercised its jurisdiction over both LuK’s validity and infringement claims. Particularly with regard to the GAT case, the infringement of Article 16(4) of the Brussels Convention (now Article 22(4) of the Brussels I Regulation) that would have, according to the ECJ, followed from the German Court’s exercise of jurisdiction over the validity issues of the French patents, would have been necessary for the German State to avoid liability for violating Article 6 of the ECHR. Finally, with particular reference to the GAT case, the result proposed above was partially achieved by the recent Dutch decision rendered by the District Court of The Hague in the 2007 Single Buoy Moorings v Bluewater case201. In addition, with regard to the Lucasfilm Court of Appeal ruling the results proposed here were also achieved by a series of US copyrights cases that emphasized the concern with affording an opportunity for meaningful relief for the foreign infringements in question. Particularly, in those cases “the absence of any forum, foreign or domestic, in which foreign infringement ac-

201

See supra, para 20.

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tions could be adjudicated has influenced US courts’ willingness to accept jurisdiction”202. 93. Analogy of the Conclusions Regarding the Relation between the Exclusive Jurisdiction Rules and the Fundamental Human Right of Access to Courts to the Conclusions Regarding the Relation between the same Exclusive Jurisdiction Rules and the Denial of Justice/Forum Necessitatis Rules The conclusions regarding the relation between the exclusive jurisdiction rules related to IPR cases and the fundamental human right of access to courts Article 6 ECHR, mutatis mutandis, are analogous to the conclusions regarding the relationship between the same exclusive jurisdiction rules and the denial of justice/forum necessitatis rules. This analogy constitutes a final argument in favor of the thesis purported here, according to which exclusive jurisdiction rules in IPR cases are contrary to public international law, and therefore should be abandoned.

IV. Declining of Jurisdiction and International Responsibility IV. Declining of Jurisdiction and International Responsibility 94. Remedies for Denial of Justice The exclusive jurisdiction rules in IPRs cases are contrary to the avoidance of a denial of justice general principle of law. From a secondary law or responsibility perspective203 the responsibility of a State may arise out of improper ju-

202

Austin, ‘The Concept of “Justiciability”’ (n 29 Chapter I) 407 and footnote 80, recalling inter alia the London Film (n 46 Chapter III) and the Armstrong (n 185 Chapter III) cases, examined at chapter II of this book. 203 With the term “secondary law” this book refers to the “content of the international responsibility of a State” and, respectively, “the implementation of the international responsibility of a State”, as established in parts II and III of the Draft Articles (n 53 Chapter VI). Specifically, this book refers to “the legal consequences” in the international legal order “for the responsible State of its internationally wrongful act, in particular with respect to cessation and reparation”, and, respectively, to “identifying the State or States which may react to an internationally wrongful act and specifying the possible modalities by which this may be done” (see the General Commentary at para 6 of the Draft Articles). By contrast, as this book concentrates on the international dimension of the exclusive jurisdiction rules, it does not deal with the consequences of the illegal act in the domestic legal systems involved. However, reference should be made to the circumstance that “the responsibility of a State may not be invoked if: / (a) the claim is not brought in accordance with any applicable rule relating to the nationality of claims; / (b) the claim is one to which the rule of exhaustion of local remedies applies and any available and effective local remedy has not been exhausted” (as such Article 44 of the Draft Articles on Admissibility of Claims).

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dicial decisions204. Therefore, declining jurisdiction over a case in conflict with forum necessitatis and the right of access to courts triggers an international responsibility of the forum State or a non-contractual liability of the European Union205. As to forum necessitatis, according also to the Report of the InterAmerican Juridical Committee in 1961, when the forum State declines jurisdiction over a case (by virtue of exclusive jurisdiction rules established by domestic, EU, or international norms), another State may “initiate diplomatic claims for the protection of its nationals […] bringing an action”206 against the forum State and under the conditions imposed by public international law to the exercise of diplomatic protection207 before an international tribunal competent to address the case, such as the ICJ, which under Article 38(1)(c) of its statute (and its case law interpretation) is competent to adjudicate the violations of the general principles of law208. In such a case, the competent international tribunal could force the forum State that improperly declined jurisdiction to reopen the proceedings209 and exercise of jurisdiction over the case. In this sense, the Belgian State recently brought an action before the ICJ against Switzerland for having adopted private international law lato sensu rules to decline (not its jurisdiction but) to enforce certain Belgium decisions210. However, States generally do not initiate diplomatic protection in favor of

204 Report of the International Law Commission (n 53 Chapter VI) on Article 4 Conduct of organs of a State according to which “1. The conduct of any State organ shall be considered an act of that State under international law, whether the organ exercises [...] judicial [functions]”. 205 Paulsson (n 1 Chapter VI) 207. 206 See the references in Francioni (n 1 Chapter VI) 11. 207 On the condition imposed by international public law on the exercise of diplomatic protection, including the expiring of the internal ways of recourse and its being a residual remedy, see Conforti, Diritto Internazionale (n 75 Chapter III) 213. 208 See supra, chapter II. 209 See Case Concerning Avena and Other Mexican Nationals (Mexico v United States) [2004] ICJ Rep 12. See also Paulsson (n 1 Chapter VI) 207. 210 See Jurisdiction and Enforcement of Judgments in Civil and Commercial Matters (Belgium v Switzerland) [2009] (Application, 22 December 2009), available at accessed 30 November 2011. On this case see Caroline Kleiner, ‘Private International Law Dispute Before the ICJ (Belgium v. Switzerland on the Interpretation and Application of the Lugano Convention)’ ConflictofLaws.net (27 December 2009) available at accessed 30 November 2011; Fabrizio Marongiu Buonaiuti, ‘Una controversia relativa alla Convenzione di Lugano giunge innanzi alla Corte internazionale di giustizia’ (2010) 2 Società italiana di diritto internazionale 454, available at accessed 30 November 2011.

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their nationals for the illegal use of private international norms by another country, even where such implies denial of justice211. Furthermore, when the rule adopted to decline jurisdiction over a case is an EU norm, the plaintiff can bring an action directly against the European Union before the European Court of Justice under Article 268 of the Treaty of the Functioning of the European Union (TFEU)212, which states that “[t]he Court of Justice of the European Union shall have jurisdiction in disputes relating to compensation for damage provided for in the second [...] paragraph[] of Article 340”213. This Article states that “in the case of non-contractual liability, the Union shall, in accordance with the general principles common to the laws of the Member States, make good any damage caused by its institutions [...] in the performance of their duties”214, such as the legislative duty. The ECJ has held that “Community law confers a right to reparation where three conditions are met: the rule of law infringed must be intended to confer rights on individuals; the breach must be sufficiently serious; and there must be a direct causal link between the breach of the obligation [by the EU Institution] [...] and the damage sustained by the injured parties[,]”215 and must also be a “higher-ranking rule of law”216. Thus, with reference to the first condition, the ECJ maintained that a rule of law confers rights upon individuals when it poses “the right to be heard” by a court217, and hence “it is foreseeable”218 that such a rule can be characterized as a high-ranking rule of law. 95. Remedies for Violation of the Fundamental Human Right of Access to Courts As for the fundamental human right of access to courts, and always from a secondary law or responsibility perspective, the content of the responsibility of the States is the same, mutatis mutandis, as that related to the violation of 211

However, see the Lotus Case (n 3 Chapter II). In an action brought by the Netherlands before the ICJ against Sweden for Sweden having violated the conflict of laws rules of an international convention see Application of the Convention of 1902 Governing the Guardianship of Infant (Netherlands v Sweden) [1958] ICJ Rep 55. 212 Treaty on European Union and of the Treaty Establishing the European Community [2006] OJ C321/E/2, Article 235 (TEC). 213 Consolidated Version of the Treaty on the Functioning of the European Union [2008] OJ C115/47, Article 268; ex Article 288 TEC. 214 Ibid at Article 340. 215 Joined Cases C-46/93 and C-48/93 Brasserie du Pêcheur SA v Bundesrepublik, Deutschland & Queen v Secretary of State for Transport [1996] ECR I-1029 para 51. 216 Case C-352/98 Laboratoires Pharmaceutiques Bergaderm SA v Commission [2000] ECR I-5291 para 17. 217 Case T-193/04 Tillack v Commission [2006] ECR II-3995 para 127. 218 Massimo Condinanzi and Roberto Mastroianni, Il contenzioso dell’Unione Europea (Torino, Giappichelli 2009) 280.

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forum necessitatis, except the following peculiarities of the ECHR system. First, when the declining of jurisdiction is grounded on the domestic rules of the forum State, the applicant can petition the forum State before the ECtHR according to ECHR mechanisms. Second, when the declining of jurisdiction is based on treaty norms, the applicant can petition the forum State before the ECtHR, since member States of the ECHR violate its Article 6, even when they limit the applicant’s right of access to courts to give effect to the rules of an international agreement. Third, when the declining of jurisdiction is based on EU norms, the applicant can still petition the forum State before the ECtHR. In those cases, the ECtHR’s Bosphorus jurisprudence applies, according to which “the protection of fundamental rights by EC law can be considered to be [...] ‘equivalent’ [...] to that of the Convention system”219. “By ‘equivalent’ the Court means ‘comparable’ [...] [rather than] ‘identical’220. Therefore, “presumption arises that [the forum EU member State] did not depart from the requirements of the Convention when it implemented legal obligations flowing from its membership of the EC”221. On the one hand, this “presumption can be rebutted if, in the circumstances of a particular case, it is considered that the protection of Convention rights was manifestly deficient. In such cases, the interest of international cooperation would be outweighed by the Convention's role as a ‘constitutional instrument of European public order’ in the field of human rights [...] [and the defendant] State would be fully responsible under the Convention [for the violation of the right of access to courts]”222. On the other hand, the future accession of the European Union to the ECHR according to Article 6(2) TEU will reasonably override the presumption posed by the Bosphorus jurisprudence and has been correctly criticized by the opinion of several judges also comprising the Grand Chamber that rendered it. In fact, it is evident that according to Article 2 of the Protocol to the Lisbon Treaty, Relating to Article 6(2) of the Treaty on European Union on the Accession of the Union to the European Convention on the Protection of Human Rights, “[t]he agreement relating to the accession [...] shall make provision for preserving the specific characteristics of the Union and Union law”223. How-

219

Turizm v Ireland no 45036/98 (ECtHR, 30 June 2005) para 165. See M. & Co. v Federal Republic of Germany no 13258/87 (ECtHR, 9 February 1990). 220 Turizm (n 219 Chapter VI) 155. 221 Ibid para 165. 222 Ibid paras 156–157. 223 Protocol to the Treaty of Lisbon (n 123 Chapter I) Relating to Article 6(2) of the Treaty on European Union on the Accession of the Union to the European Convention on the Protection of Human Rights and Fundamental Freedoms, available at accessed 30 November 2011.

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ever, as it was recently correctly noted224, it is the European Union that is accessing to the ECHR, and not vice versa. Additionally, the privileged system posed by Bosphorus in favor of the European Union will not be tolerable to all other States that are not members of the EU and that are party to the ECHR, especially when accession of the European Union will place it on an equal footing with them. At any rate, the ECtHR very recently established that the equivalence of the European Union and the ECHR systems shall be evaluated not in the abstract, or in a merely theoretical way, but rather in a realistic way and on a case-by-case basis225. The ECtHR, at the same time, “expanded the subjective and objective scope of the State responsibility” in relation to international organization, by stating in the Gasparini decision226 that “member States are obliged, when they transfer a part of their sovereign powers to an international organi[z]ation to which they adhere, to scrutini[z]e that the rights granted by the Convention will receive in the frame of the international organi[z]ation an ‘equivalent protection’ to that of the Convention system”227. Finally, in all those cases according to the ECtHR “the most appropriate form of redress would, in principle, be trial de novo or the reopening of the proceedings, in due course and in accordance with the requirements of Article 6 of the Convention”228.

224 Vladimiro Zagrebelsky, ‘L’adesione Dell’UE alla CEDU: Il ‘Nodo Giudiziario’ Italian Society of International Law XV Congress in Bologna (10-11 June 10-11 2010) available at accessed 30 November 2011. 225 Producentenorganisatie van de Nederlands Kokkelvisserij U.A. v Netherlands no 13645/05 (ECtHR, 20 January 2009). 226 Gasparini v Italia and Belgium no 10750/03 (ECtHR, 12 May 2009). 227 Ibid, “[L]es Etats membres ont l'obligation, au moment où ils transfèrent une partie de leurs pouvoirs souverains à une organisation [sic] internationale à laquelle ils adhèrent, de veiller à ce que les droits garantis par la Convention reçoivent au sein de cette organisation [sic] une ‘protection équivalente’ à celle assurée par le mécanisme de la Convention”. 228 Somogyi v Italy no 67972/01 (ECtHR, 18 May 2004) para 86.

Chapter VII

General Conclusions General Conclusions 96. Conclusions This book argues that exclusive jurisdiction rules related to IPRs cases are not only insufficiently supported by any of the arguments usually invoked in their favor, but actually are also contrary to the public international law rules on the avoidance of a denial of justice and on the fundamental human right of access to a court, and therefore should be abandoned with respect to infringement and validity claims involving either registered or unregistered IPRs, however raised. Particularly, Chapter II conducts a comparative analysis of States’ practice related to international jurisdiction rules concerning cross-border validity and infringement claims however raised of registered and unregistered IPRs, highlighting the following. First, that the existent exclusive jurisdiction rules governing claims of infringement of registered and, in some cases, unregistered rights are not an expression of a customary international law rule. Second, that exclusive jurisdiction rules relating to registered IPRs validity issues principally raised are not expressions of customary law. Third, that with respect to registered IPRs validity issues principally raised, certain countries such as China and Taiwan do not currently provide any exclusive jurisdiction rules in this respect. Finally, that with respect to registered IPRs validity issues principally raised, a clear trend exists in overcoming exclusive jurisdiction rules. Expressions of this trend include the ALI Principles and the Transparency Proposal. Chapter III analyses the act of State and comity doctrine as a basis for exclusive jurisdiction rules in IPRs cross-border litigation cases, indicating the following. First, none of the arguments for extending the act of State and comity doctrines to IPRs are convincing: the act of state doctrine does not always prevent courts from adjudicating foreign acts of states; in any case IPRs are not acts of states since they are not an expression of the sovereignty of foreign governments; assuming jurisdiction over foreign IPRs claims is even imposed by public international law; and the exercise of such jurisdiction does not prejudice the rights of foreign governments. Second, the question of extending the act of State and comity doctrines to IPRs cases is not suggested by public international law because public international law does not limit a State’s exercise of jurisdiction inside its borders, and because a strictly territorial conception of sovereignty and jurisdiction seems to be abandoned nowa-

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days. Finally, the question of extending the act of State and the comity doctrines to IPRs cases is not only not suggested by public international law, but is actually contrary to this law because the rules on the act of State and comity are against the right of access to a court since they limit this right without meeting either the establishment by law, or the legitimate aim and the proportionality requirements. Chapter IV analyses the territoriality principle adopted as a basis for exclusive jurisdiction rules in IPRs cross-border litigation cases. Chapter IV principally determined that universal protection of IPRs cannot be achieved outside IP systems, namely by extending to IPRs infringements the universal jurisdiction related to the crime of piracy, human rights solutions, and the UNIDROIT Convention on Stolen or Illegally Exported Cultural Objects. Second, the universal protection of IPRs shall be achieved inside the IP systems. Third, the territoriality principle in the CUP, CUB, and TRIPs agreement as well as at the basis of other relevant norms expressly shaped as PIL rules does not impede the universal protection of IPRs inside the IP system: because it shall be interpreted as an expression of the proximity principle, as is supported by groups of rules deviating from the territoriality principle, namely the rules that adopt jurisdiction criteria which are not based on the territoriality principle, the rules that adopt connecting factors which are not based on the territoriality principle and the rules on the recognition and enforcement of foreign judgments that are not grounded on the territoriality principle. Fourth, the territoriality principle interpreted as an expression of the proximity principle mandates the abandoning of exclusive jurisdiction rules; the overcoming of the exclusive designation of the lex loci protectionis; and the overruling of the norms that impede the recognition and enforcement of foreign judgments concerning IPRs granted by States other than the ones of the rendering courts. Finally, with particular regard to exclusive jurisdictions, then, from a de lege lata perspective the PIL norms that ground exclusive jurisdiction in a specific court in relation to IPRs cases shall be interpreted as not impeding the granting of jurisdiction to a court other than the exclusively competent one, when the “alternative” court is more proximal to the concrete case than the “exclusively” competent court, and therefore allows a better allocation of jurisdiction. In contrast, from a de lege ferenda perspective, when the proposed interpretation of those rules is not possible they shall be overruled. Chapter V analyses the eight alternative arguments invoked in support of exclusive jurisdiction rules, namely: the extension of the Moçambique rule to IPRs claims; the adoption of the double actionability rule in IPRs cases; the fact that the courts having exclusive jurisdiction are the only ones to grant sound administration of justice and judicial economy; the fact that the courts having exclusive jurisdiction are the best placed courts to adjudicate IPRs disputes; the impossibility of allocating jurisdiction to courts other than the

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exclusively designated ones by reason of the difficulty of applying foreign laws; the impossibility of allocating jurisdiction to courts other than the exclusively designated ones by reason of the impossibility of recognizing and enforcing judgments concerning foreign IPRs in the countries of registration; the impossibility of allocating jurisdiction to courts other than the exclusively designated ones by reason of the impossibility to amend national registers; and the inconvenience that derives from the adjudication of the case by courts other than those exclusively designated to exercise jurisdiction over foreign IPRs cases in issue in light of the forum non conveniens doctrine. Chapter V highlights that none of those eight ‘other arguments’ referred to in favour of exclusive jurisdiction rules are convincing, and cannot serve as a ground for exclusive jurisdiction rules. Chapter VI analyses public international law rules of a universal and regional (EU/EFTA) nature as well as the national norms on the denial of justice and on the forum necessitatis, as well as the fundamental human right of access to a court. The chapter determined the following. First, exclusive jurisdiction rules imply a denial of justice because they allow courts to dismiss cases sufficiently linked to the forum State, and thus meeting the first connection requirement of the denial of justice/forum necessitatis rule, and because they require parties to address their claims in the courts of each of the foreign States where the IPRs had been granted in an unreasonable and ineffective way, and thereby meeting the second requirement of the denial of justice/forum necessitatis rule. Second, exclusive jurisdiction rules are contrary to the fundamental human right of access to the courts for the following reasons. Sufficient and non-fortuitous links can exist between a case and the court of a state other than the granting state. In the majority of cases the restrictions posed by exclusive jurisdiction rules are not established by a sufficiently clear law, but rather are grounded on implicit rationales suggested by public international law, which are alleged to exist. The restrictions do not pursue a legitimate aim since the purported aim is to comply with public international law, but public international law not only does not suggest implicit exclusive jurisdiction rules, but rather considers such rules as contrary to it. The restrictions are disproportionate to the aim pursued, concerning neither matters regarding immunity from jurisdiction nor cases presenting certain recognized peculiarities, and even impairing in its essence the right of access to courts, since on the one hand the parties do not have other means of recourse available in the forum State, and on the other hand, the means of recourse available to the parties outside the forum State imply a duplication of proceedings and, therefore, are ineffective. Finally, to avoid denial of justice and to safeguard the right of access to courts, States should follow three different, concurrent approaches, each of which leads to the same results. From a de lege ferenda perspective States should declare as unconstitutional or over-

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rule their explicit exclusive jurisdiction provisions, and also revisit their case law according to which exclusive jurisdiction rules are implicitly suggested by public international law. From a de lege lata perspective States should adopt the private international law solution, searching for other rules of private international law that are different and prevailing over the rules that would otherwise lead to the declining of jurisdiction; finding these rules in forum necessitatis, which is a PIL rule and a general principle of law, and which therefore has a direct effect and prevails over exclusive jurisdiction rules (domestic or of the Brussels system); and adopting this forum and thus exercising jurisdiction by necessity despite exclusive jurisdiction provisions. From a de lege lata perspective, States should adopt the human rights solution, interpreting the right of access to courts as a general principle of law, and its primacy over the other international, European, and domestic rules on exclusive jurisdiction; recognizing that to decline jurisdiction by reason of exclusive jurisdiction rules would constitute a breach of the right of access to courts by a court; referring to this violation as the ground for not so acting, and therefore of not declining jurisdiction; and thus exercising jurisdiction despite exclusive jurisdiction provisions. 97. EU IPRs and European Unified Patent Judiciary These conclusions also apply with respect to European Union IPRs, such as the Community trademark1. In fact, with regard to claims relating to infringement actions, actions for declaration of non-infringement, and counterclaims for revocation or for a declaration of invalidity of the Community trademarks, Articles 92–94 of the Community Trademark Regulation pose “exclusive jurisdiction” rules. However, on the one hand, from an EU member States’ perspective, those norms do not ground international jurisdiction in a sole and exclusively competent court, but, rather, establish a plurality of possibly competent tribunals, namely of the (trademark) courts of the EU member State chosen by the parties according to the Brussels Convention (now Brussels I Regulation), or, alternatively, of the EU member State where the defendant is domiciled or has an establishment, where the plaintiff is domiciled or has an establishment, where the Office of Harmonization for the Internal Market (OHIM) has its seat, or where the infringement has been committed or threatened (with the exception of actions for a declaration of non-infringement of a Community trade mark.) Thus, these “exclusive jurisdiction” rules, not being at all exclusive, do not conflict with the norms of public international law on denial of justice and on the fundamental human right of access to a court.

1

See supra, para 18.

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On the other hand, from the perspective of States that are not members of the EU, Articles 92–94 of the Community Trademark Regulation aim at impeding access to courts other than the exclusively competent EU tribunals. Thus, with respect to States that are not members of the EU, Articles 92–94 of the Community Trademark Regulation effectively establish exclusive jurisdiction rules, even though in favor of more than one EU court. Therefore, these rules can conflict with the rules of public international law on the denial of justice and on the fundamental human right of access to courts2. The conclusions just reached with respect to the Community trademarks also apply in relation to other European and Community IP rights, such as plant variety rights and design3. The same conclusions of the here-purported thesis, apply with respect to the European unified patent judiciary4. In fact, from a European perspective, the ECPC was generally to be welcomed as it would grant unitary litigation in the majority of cases and lower the entry burdens on potential litigants (such as language, high cost, distance, etc.), all of which were preferable to the status quo of fragmented litigation. From a non-European perspective, however, the ECPC litigation system impeded access to non-EU courts, which raised many of the same concerns as the Community Trademark Regulation, particularly when the owner of the European patent did not have the resources to litigate its European patent before the ECPC. 98. Preventing Economic Inequalities in Litigation in Favour not only of the IPRs Owners but of those with the Potential to Infringe IPRs as well. The conclusions here supported invoke the abandonment of exclusive jurisdiction rules. This abandonment would prevent economic inequalities in cross-border IP litigation. In fact, should a small-medium company enter into certain foreign markets products allegedly infringing upon foreign patents owned by a multinational company around the globe, the multinational company will want to protect its patents in all jurisdictions where the patents are registered and the allegedly infringing products are entered. Exclusive jurisdiction rules here would force the IPRs owner to commence proceedings in multiple jurisdictions as well as obligate the small-medium size manufacturer to defend itself in each jurisdiction. This causes obvious economic inequalities: for whereas the multinational company might be able to finance litigation in every relevant jurisdiction or at least in the ones that would be likely to produce spill-over effects, the small-medium manufacturer may well lack the same financial strength to defend each proceeding. 2

Ibid. Ibid. 4 See supra, para 4. 3

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Furthermore, the abandonment of exclusive jurisdiction rules would favour not only the IPRs owners but those with the potential to infringe IPRs also. In fact, statistics reveal that foreign defendants engaged in IPRs litigation overseas are commonly domiciled in countries where the infringement of IPRs would previously have been unexpected: foreign defendants are no longer represented as part of “a garage operation in the Far East”5 running underground infringement operations, but are often legally operating entities, such as generic drug manufacturers. For example, should a drug manufacturer enter into certain foreign markets a generic brand of drug already protected by many patents owned by a multinational company around the globe, this company will want to protect its patents in all jurisdictions where the patents are registered. Exclusive jurisdiction rules here would force the IPRs owner to commence proceedings in multiple jurisdictions as well as obligate the generic drug manufacturer to defend itself in each jurisdiction. This will cause the same economic inequalities as outlined above. 99. Forum Shopping Exclusive jurisdiction rules determine a single forum that has international jurisdiction to hear the case, impeding forum shopping, and favouring the principle of legal certainty6. In contrast, one could argue that the conclusions here proposed favour forum shopping, and “are so malleable as to render them non-criteria in practice”7. Thus, one could think that the conclusions proposed here are in contrast to the need of legal certainty. However, this is not the case. First, the conclusions here proposed allow the petitioning of a limited number of courts other than the one that would have exclusive jurisdiction over the case: in fact, the public international rules considered here do not ground international jurisdiction in whichever court, but rather vest international jurisdiction in the courts of the States to which the case in question is 5

Trimble Landova, ‘When foreigners Infringe Patents’ (n 1 Chapter I) 548. Frigo (n 32 Chapter I). 7 Ryngaert (n 38 Chapter I) 182, who, however, criticizes these critics as adopting a “defeatist approach”, which should not be embraced. The author proposes that a general principle of public international law exists according to which States shall exercise their jurisdiction in civil and commercial transnational matters taking duly into account the interests of the international community and thus in a reasonable way. Then, the general principle of international law of the reasonable jurisdiction not only “requires that States restrain their jurisdiction, but also […] require[s] them to actually exercise their jurisdiction when such would be in the interest of the international community” (at 5). Thus, the reasonableness principle leads to similar conclusions as the general principle of law of the access to a court, namely both principles impede the exorbitant fora, as much as those for exclusive jurisdiction. See Ryngaert (ibid) for relevant jurisprudential and normative references to the general principle of law of the reasonable jurisdiction. 6

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sufficiently and not fortuitously linked, in conformity with the general principles of law of proportionality and genuine connection8. Second, the existence of more than one court with international jurisdiction over a case constitutes the typical situation according to the Brussels System which establishes a true right to forum shopping, by establishing a general forum and several concurrent fora, and imposing certain exclusive fora only of an exceptional nature9: thus, the concurrent international jurisdiction here proposed does not create any greater legal uncertainty than that at the basis of the typical situation under the Brussels system. Third, it is evident that recent decades have seen debate aimed at limiting forum shopping with regard to intellectual property cross-border litigation10. However, this debate, aimed at limiting forum shopping, has arisen only in connection with cases where the adoption thereof was abusive. According to the debate, when “a party abusively triggers the jurisdiction of a court in order to obtain an unjust advantage, thus practi[c]ing unacceptable forum shopping, the court addressed could decline jurisdiction by adopting the ‘corrective mechanisms”11 established by its international procedural law rules “such as ‘forum non conveniens’ in English Law, or ‘exception de fraude’ in French Law”12, or imposed by the ECHR in granting to the defendant the right to be submitted (not to exorbitant jurisdictions but) to a fair trial. Indeed, the hereproposed conclusions do not favour abusive forum shopping, but are instead strictly limited to that necessary to allow the right of access to courts; and therefore, respect the general principle of law imposing the avoidance of the abuse of rights13. Finally, the conclusions proposed here derive from the public international law rules related to the right of access to courts, and those rules prevail over the need of legal certainty, as was argued in chapter VI14.

8

Ibid 145 and 148. On the right of forum shopping with respect to IPRs cases see Pertegás Sender, CrossBorder (n 130 Chapter IV) 32; Luginbuehl (n 109 Chapter I) 45. In general terms see Gilles Cuniberti, ‘Abusive Forum Shopping?’ Conflictoflaws.net (3 May 2010) available at accessed 30 November 2011. 10 On this debate see Luginbuehl (n 109 Chapter I) 45. 11 See in general terms Pascal de Vareilles-Sommières (ed), Forum Shopping in the European Judicial Area (Oxford, Hart Publishing 2007); Martin George, ‘Publication: Forum Shopping in the European Judicial Area’ Conflictoflaws.net (8 February 2008) available at

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Table of Cases Australia Potter v Broken Hill Pty Co Ltd. [1905] VLR 612, affd (1906) 3 CLR 479 Norbert Steinhardt and Son Ltd v Meth and Another (1961) 105 CLR 440 Régie Nationale des Usines Renault SA v Zhang (2003) 210 CLR 491 TS Production v Drew Pictures (2008) 252 ALR 1 Belgium Case C-70/10 Scarlet (5 February 2010) Extended SA v Société Belge des auteurs, compositeurs et éditeurs (SABAM) [2010] OJ C113/30 Canada Pro Swing Inc. v Elta Golf Inc. [2006] 2 SCR 612 ECJ C-21/76 Handelskwekerij G. J. Bier BV v Mines de potasse d'Alsace SA [1976] ECR 1735 125/79 Denilauer v SNC Couchet Frères [1980] ECR 1553 288/82 Duijnstee v Goderbauer [1983] ECR 3663 C-3/91 Exportur [1992] ECR I-5529 C-294/92 Webb v Webb [1994] ECR I-1717 C-68/93 Shevill v Presse Alliance SA [1995] ECR I-415 C-46/93 and C-48/93 Brasserie du Pêcheur SA v Bundesrepublik Deutschland & Queen v Secretary of State for Transport [1996] ECR I-1029 C-7/98 Dieter Krombach v André Bamberski [2000] ECR I-1935 C-352/98 Laboratoires Pharmaceutiques Bergaderm SA v Commission [2000] ECR I-5291 C-38/98 Régie Nationales des Usines Renault SA v Maxicar SpA [2000] ECR I-1935 C-116/02 Erich Gasser GmbH v MISAT Srl [2003] ECR I-14693 C-4/03 Opinion of Advocate General Geelhoed (16 September 2004) C-281/02 Owusu v N.B. Jackson [2005] ECR I-1383 C-28/04 Tod’s SpA, Tod’s France SARL v Heyraud SA [2005] ECR I-5783 C-1/03 Opinion, ‘Competence of the Community to Conclude the New Lugano Convention on Jurisdiction and the Recognition and Enforcement of Judgments in Civil and Commercial Matters’ [2006] ECR I-1145 T-193/04 Tillack v Commission [2006] ECR II-3995 C-341/04 Eurofood IFSC Ltd [2006] ECR I-3854 C-4/03 Gesellschaft für Antriebstechnik mbH & Co. KA (GAT) v Lamellen und Kupplungsbau Beteilgungs KG (LuK) [2006] ECR I-6509 C-343/04 Land Oberösterreich v EZ AS [2006] ECR I-4557 C-539/03 Roche Nederland BV v Primus [2006] ECR I-6535 C-175/06 Opinion of Advocate General Kokott in Tedesco (18 July 2007)

Table of Cases

331

C-175/06 Alessandro Tedesco v Tomasoni Fittings Srl and RWO Marine Equipment Ltd [2007] ECR I-07929 C-275/06 Promusicae v Telefónica de España SAU [2008] ECR I-271 C-478/07 Budjovický Budvar, národní podnik v Rudolf Ammersin GmbH [2009] OJ C267/21 C-529/07 Chocoladefabriken Lindt and Sprüngli AG v Franz Hauswirth GmbH [2009] ECR I-4893 C-533/07 Falco Privatstiftung and Thomas Rabitsch v Gisela Weller-Lindhorst [2009] ECR I03327 C-394/07 Marco Gambazzi v DaimlerChrysler Canada Inc. [2009] ECR I-2563 C-420/07 Meletis Apostolides v David Charles Orams and Linda Elizabeth Orams [2009] ECR I-3571 C-144/10 Berliner Verkehrsbetriebe (BVG) v JPMorgan Chase Bank NA, Frankfurt Branch [2011] OJ C194/07 Joined Cases C-509/09 and C-161/10 eDate Advertising GmbH v X and Olivier Martinez, Robert Martinez v MGN Limited [2011] OJ C370/9 C-34/10 Oliver Brüstle v Greenpeace eV [2011] C-616/10 Solvay S.A. v Honeywell Fluorine Products Europe B.V. Honeywell Belgium N.V. Honeywell Europe N.V. [2011] OJ C89 C-1/09 Opinion of the Court (Full Court) (8 March 2011) C-133/11, Reference for a preliminary ruling from the Bundesgerichtshof (Germany) lodged on 18 March 2011 - Folien Fischer AG and Fofitec AG v RITRAMA SpA. ECtHR Golder v United Kingdom no 4451/70 (ECtHR, 21 February 1975) König v Federal Republic of Germany no 6232/73 (ECtHR, 28 June 1978) X v Austria no 7830/70 (ECtHR, 1978) X v Switzerland no 8000/77 (ECtHR, 9 May 1978) Airey v Ireland no 6289/73 (ECtHR, 9 October 1979) Deweer v Belgium no 6903/75 (ECtHR, 27 February 1980) M. & Co. v Federal Republic of Germany no 13258/87 (ECtHR, 9 February 1990) Kruslin v France no 11801/85 (ECtHR, 24 April 1990) Smith Kline and French Laboratories Ltd v the Netherlands no. 12633/87 (4 October 1990) De Geouffre de la Pradelle v France no 12964/87 (ECtHR, 12 December 1992) British-American Tobacco Co. v Netherlands no 19589/92 (ECtHR, 20 November 1995) Acquaviva v France no 19248/91 (ECtHR, 21 November 1995) Denev v Sweden no 25419/94 (ECtHR, 9 April 1997) Waite v Germany no 26083/94 (ECtHR, 18 February 1999) Beer and Regan v Germany no 28934/95 (ECtHR, 18 February 1999) Lenzing AG v Germany no 39025/97 (ECtHR, 9 September 1999) Beyer v Italy no 33202/96 (ECtHR, 5 January 2000) Pellegrini v Italy no 30882/96 (ECtHR, 20 July 2001) Association Ekin v France no 39288/98 (ECtHR, 17 July 2001) Hans-Adam II v Germany no 42527/98 (ECtHR, 12 July 2001) Al-Adsani v United Kingdom no 35763/97 (ECtHR, 21 November 2001) Fogarty v United Kingdom no 37112/97 (ECtHR, 21 November 2001) McElhinney v Ireland no 31253/96 (ECtHR, 21 November 2001) Bayrak v Germany no 27937/95 (ECtHR, 20 December 2001) Somogyi v Italy no 67972/01 (ECtHR, 18 May 2004) Turizm v Ireland no 45036/98 (ECtHR, 30 June 2005)

332

Table of Cases

Melnychuk v Ukraine no 28743/03 (ECtHR, 5 July 2005) Anheuser-Busch v Portugal no 73049/01 (ECtHR, 11 January 2007) Maumousseau et Washington v France no 39388/05 (ECtHR, 6 December 2007) Balan v Moldova no 19247/03 (ECtHR, 29 January 2008) McDonald v France no 18648/04 (ECtHR, 29 April 2008) Saccoccia v Austria no 69917/01 (ECtHR, 18 December 2008) Producentenorganisatie van de Nederlands Kokkelvisserij U.A. v Netherlands no 13645/05 (ECtHR, 20 January 2009) Gasparini v Italia and Belgium no 10750/03 (ECtHR, 12 May 2009) Rambus Inc. v Germany no 40382/04 (ECtHR, 16 June 2009) Jurisdiction and Enforcement of Judgments in Civil and Commercial Matters (Belgium v Switzerland) [2009] (Application, 22 December 2009) Cudak v Lithuania no 15869/02 (ECtHR, 23 March 2010) Vrbica v Croatia no 32540/05 (ECtHR, 1 April 2010) Sabeh El Leil v France no 34869/05 (ECtHR, 29 June 2011) France GRE Manufacturas v Agrisilos [2006] I L Pr 27 C-278/09 Olivier Martinez, Robert Martinez v Société MGN Limited [2009] OJ C220/56 Germany Hotel Maritime (Case IZ R 163/02, 13 October 2004) Reference for a preliminary ruling from the Bundesgerichtshof (Germany) lodged on 18 March 2011 - Folien Fischer AG and Fofitec AG v RITRAMA SpA, C-133/11. ICJ Asylum Case (Columbia v Peru) [1950] ICJ Rep 266 Anglo-Norwegian Fisheries Case [1951] ICJ Rep 116 Application of the Convention of 1902 Governing the Guardianship of Infant (Netherlands v Sweden) [1958] ICJ Rep 55 North Sea Continental Shelf Cases (Federal Republic of Germany/Denmark; Federal Republic of Germany/Netherlands) (Merits) [1969] ICJ Rep 3 Delimitation of the Maritime Boundary in the Gulf of Maine Area (Canada/United States of America) (Merits) [1984] ICJ Rep 246 Military and Paramilitary Activities in and against Nicaragua Case (Nicaragua v United States of America) (Merits) [1986] ICJ Rep 14 Legality of the Threat or Use of Nuclear Weapons, Advisory Opinion [1996] ICJ Rep 226 Case Concerning Avena and Other Mexican Nationals (Mexico v United States) [2004] ICJ Rep 12 Italy Cass. s.u. 3657/89, in Foro it. [1990], I, 117 Corte di Appello di Milano 16.03.1990, in RDIPP [1990] p. 698 Trib. Milano 17.09.1992, in GADI [1992] p. 2851 Trib. Brescia 11.11.1999, in GADI [2000] n. 4107 p. 505 Trib. Roma ordinanza 01.02.2000, in AIDA [2000] p. 870 Trib. Torino ordinanza 19.05.2000, in GADI [2001] n. 4224/1 p. 225 Italian Supreme Court Cass. 19.12.2003, n. 19550, BL Macchine Automatiche ApA v Windmoller & Holscher KG, in GRUR Int [2005] 264 Corte di Appello di Milano 02.03.2004, in GADI [2004] n. 4719 p. 837

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333

Trib. Milano 29.03.2005, in AIDA [2005] p. 640 Trib. Milano 60696/07 29.11.2007, unpublished Trib. Milano 10.01.2009, in GADI [2009] n. 5395 p. 637 Trib. Torino 10.03.2009, in GADI [2009] n. 5407 p. 741 Trib. Milano 06.08.2008, in Diritto d’autore [2009] n. 2 p. 332 Trib. Torino 10.03.2009, in RDIPP [2010] p. 496 Trib. Venezia 16.04.2011, unpublished Trib. Venezia 16.04.2011, unpublished Japan Japanese Supreme Court decision of 8 June 2001 – Tsuburaya Production, Minshu, Vol. 55(4) p. 727 Hanrei Jih, No. 1874, p. 23 (16 October 2003) New Zealand Atkinson Footwear Ltd. v Hodgskin International Services Ltd. and Another (1994) 31 IPR 186 HC KK Sony Computer Entertainment v Van Veen (2006) 71 IPR 179 PCIJ Lotus Case (France v Turkey) (Merits) PCIJ Rep Series A No 10 Permanent Court of Arbitration Island of Palmas (or Miangas) Case (United States v The Netherlands) (1928) 2 UN Rep Intl Arb Awards 829 Singapore Rickshaw Investments v Nicolai Baron von Uexkull [2006] SGCA 39 South Africa Gallo Africa Ltd. v Sting Music (Pty) Ltd. [2010] (6) SA 329 (SCA) Sweden Flotek AB case, 14.06.2000, in GRUR Int [2001] 178 Switzerland Obergericht ZH, Feb. 1, 1990, ZR 89 (1990), n. 4, p. 7 Obergericht ZH, Feb. 26, 1992, ZR 90 (1991), n. 89, p. 289 Eurojobs Personaldienstleistungen SA v Eurojob AG, Zivilabteilung 4C.439/2006 (4 April 2007) The Netherlands Expandable Grafts Partnership v Boston Scientific [1999] FSR 352 (23 April 1998) Single Buoy Moorings Inc. v Bluewater c.s. (11 April 2007) Fort Vale/Pelican, Case No. 07-2964 (18 June 2008) Roucar Gear Technologies BV v Four Stroke SARL, Case 277615/HA ZA 09-2640 (30 June 2010) Solvay S.A. v Honeywell Fluorine Products Europe B.V., Case No. 09-2275 (15 September 2010) Yellow Page Marketing Ltd. v Yell Ltd., LJN BR1364 (12 July 2011)

334

Table of Cases

United Kingdom Phillips v Eyre (1870) LR 6 QB 1 British South Africa Co v Companhia de Moçambique [1893] AC 602 Chaplin v Boys [1971] AC 354 (HL) Def Lepp Music v Stuart-Brown [1986] RPC 273 Spiliada Maritime Corporation v Cansulex Ltd. [1986] AC 460 (HL) Tyburn Productions Ltd v Conan Doyle [1991] Ch 75 Fort Dodge Animal Health Ltd and Others v Akzo Nbel NV and Another [1998] FSR 222 Coin Controls Ltd v Suzo International (UK) Ltd and Others [1999] Ch 33 Pearce v Ove Arup Partnership Ltd [2000] Ch 403 Prudential Assurance Co Ltd. v Prudential Insurance Co of America [2003] EWCA (Civ) 327 Sandisk Corp v Koninklijke Philips Electronic NV [2007] EWHC 332 (Ch) Knorr-Bremse Systems for Commercial Vehicles Ltd v Haldex Brake Products GmbH [2008] EWHC 156 (Pat) 46 Crosstown Music Co 1, LLC v Rive Droite Music Ltd. & Ors [2009] EWHC (Civ) 1222 Lucasfilm Entertainment Co. v Ainsworth [2009] EWCA (Civ) 1328 Berliner Verkehrsbetriebe (BVG) Anstalt des Öffentlichen Rechts v JP Morgan Chase Bank NA [2010] EWCA (Civ) 390 Lucasfilm Ltd. & Ors v Ainsworth & Anor [2011] UKSC 39 European Central Bank v Document Security Systems Inc. [2008] EWCA (Civ) 192 United States Hilton v Guyot 159 U.S. 113 (1895) Underhill v Hernandez 168 US 250 (1897) Bernstein v Van Heyghen Frères 163 F.2d 246 (2nd Cir.1947) Gulf Oil Corporation v Gilbert 330 U.S. 501 (1947) Vanity Fair Mills v T. Eaton Con. 234 F.2d 633 (1956) Pasos v Pan American Airways 229 F. 2d 271 (2nd Cir. 1956) Banco Nacional de Cuba v Sabbatino 376 U.S. 398 (1964) Republic of Iraq v First National City Bank 353 F. 2d 47 (2nd Cir. 1965) Ortman v Stanray Corp. 317 F.2d 154 (7th Cir. 1967) Canadian Filters (Harwich) Ltd. v Lear-Siegler, Inc. 412 F.2d 577 (1st Cir. 1969) Packard Instrument Co. v Beckman Instruments Inc. 346 F.Supp. 408 (N.D. III. 1972) First National City Bank v Banco Nacional de Cuba 406 U.S. 759 (1972) Dahlgren Manufacturing Co. v Harris Corp. 399 F.Supp. 1253, (N.D. Tex. 1975) Mannington Mills, Inc. v Congoleum Corp. 595 F.2d 1287 (1979) Forbo-Giubiasco S.A. v Congeleum Corp. 516 F.Supp. 1210 (S.D.N.Y. 1981) Clayco Petroleum Corp. v Occidental Petroleum Corp. 712 F.2d 404, 406 (9th Cir. 1983) London Film Productions Ltd. v Intercontinental Communications, Inc. 580 F. Supp. 47 (S.D.N.Y. 1984) Stein Assoc’s, Inc. v Heat and Control, Inc. 748 F.2d 653 (Fed Cir. 1984) Societé Nationale Industrielle Aérospatiale v U.S. Sist. Court for the S.D. of Iowa 482 U.S. 522, 543 n. 27 (1987) Kirkpatrick Co. Inc. v Environmental Tectonics Corporation International 493 U.S. 400, 406, 409 (1990) Vas-Cath Inc. Mahurkar 745 F. Supp. 517, 525 (N.D. Ill. 1990) Lockman Foundation v Evangelical Alliance Mission 930 F.2d 764 (9th Cir. 1991) TSI T.V. Productions, Inc. v California Authority of Racing Fairs, et al. 785 F.Supp. 854 (E.D. Ca. 1992)

Table of Cases

335

Mars, Inc. v Kabushiki-Kaisha Nippon Conlux 825 F.Supp. 73 (D. Del. 1993), 24 F.3d 1368 (Fed. Cir. 1994) Berkshire Furniture Co. Inc. v Glattstein 921 F.Supp. 1559, 1561 (W.D. Ky 1995) Creative Technology, Ltd. v Atzech System PTE, Ltd. 61 F.3d 696 (9th Cir. 1995) Frink America, Inc. v Champion Road Machinery Ltd. et al. 961 F.Supp. 398, 404 (N.D.N.Y. 1997) S. Megga Telecommunications Ltd. v Lucent Technologies, Inc. case unreported, 1997 U.S. Dist. LEXIS 2312 Boosey & Hawkes Music Publishers Ltd. v Walt Disney Co 145 F.3d 481 (2d Cir. 1998) Armstrong v Virgin Records, Ltd. 91 F.Supp. 2d 628 (S.D.N.Y. 2000) Bigio v The Coca-Cola Company 239 F. 3d 440, 449-450 (2nd Cir. 2000) Microsoft Corp v Lindows.com, Inc. unreported, No. C01-2115C, 2002 WL 31499324 Sarl Louis Feraud International v Viewfinder, Inc. 406 F. Supp. 2d. 274, 281 (S.D.N.Y 2005) Monolithic Power Systems Inc. v 02 Micro International Ltd., unreported case, 2006 U.S. Dist. LEXIS 78601 Ideal Instruments v Rivard Instruments 434 F.Supp.2d 598 (N.D. Iw. 2006) Voda v Cordis Corp 476 F.3d 887 (Fed. Cir. 2007) New Name Inc. v The Walt Disney Co. et al. (2007) WL 5061697 (C.D. Cal. 2007) Fairchild Semiconductor Corp. v Third Dimension (3D) Semiconductor Inc. 589 F.Supp.2d 84, 91 and 94 (Maine 2008) Citizens United v Federal Election Commission 130 S. Ct. 876 (2010) Kiobel v Royal Dutch Petroleum 621 F.3d 111 (2nd Cir. 2010) Ewa-Marie Rundquist v Vapiano SE, unreported. 2011 U.S. Dist. LEXIS 78781

Table of Treaties, Conventions and Other Instruments AIPPI AIPPI Lucerne Resolution on “Jurisdiction and applicable law in the case of cross-border infringement (infringing acts) of intellectual property rights”, 2003 AIPPI Gothenburg Resolution on “intellectual property and genetic resources, traditional knowledge and folklore”, 2006 American Law Institute ALI Principles, 2007 The American Law Institute/UNIDROIT Principles of Transnational Civil Procedure, 2004 Council of Europe European Convention for the Protection of Human Rights and Fundamental Freedoms, 1950 European Group for Private International Law Proposed Amendment of Regulation 44/2201 in Order to Apply it to External Situations, 2008 Resolution on Le règlement «Bruxelles I» et les décisions judiciaires rendues dans des Etats non membres de l’Union européenne, 2010 European Max Planck Group on Conflict of Laws in Intellectual Property CLIP Principles, 2011 European Patent Office Convention on the Grant of European Patents, 1973 European Union Brussels Convention, 1968 Jenard Report, 1979 Report Schlosser, 1979 Council Regulation (EC) 40/94 Council Regulation (EC) 2100/94 Charter of Fundamental Rights of the European Union, 2000 Proposal for a Council Regulation on the Community patent, 2000 Council Regulation (EC) 44/2001 Council Regulation (EC) 6/2002 Council Regulation (EC) No 2201/2003 Regulation (EC) 805/2004 Council Directive 2004/48/EC Treaty on European Union and of the Treaty Establishing the European Community, 2006 Council Regulation (EC) 864/2007

Table of Treaties, Conventions and Other Instruments

337

Consolidated Version of the Treaty on the Functioning of the European Union, 2008 Council Regulation (EC) 4/2009 Explanatory Report of the Lugano Convention by Fausto Pocar, 2009 Lugano Convention, 2010 Institut de Droit International Resolution Wiesbaden, 1975 Resolution Bruges, 2003 National Documents China Supreme Court’s Interpretation of Several Questions on the Application of Law in on-line Copyright Disputes Litigation, 2000 Chinese Supreme Court, Interpretation of Several Questions on the Application of Law in online Copyright Disputes Litigation, 2006 Chinese Supreme Court, Interpretation of Several Rules on the Legal Issues arising from Patent Disputes Litigation, 2001 Law of the People’s Republic of China on the law applicable to foreign-related civil relations, 2010 Japan Japan’s New Act on International Jurisdiction, 2011 USA Lamy reports, 2010 The Leahy-Smith America Invents Act, 2011 Dod Strategy for Operating in Cyberspace, 2011 Swiss Federal Act of Private International Law, 1987 Private International Law Association of Korea and Japan Waseda Proposal, 2010 The Hague Conference of Private International Law Hague Preliminary Draft Convention on Jurisdiction, 1999 Hague Convention on Choice of Court Agreement, 2005 Transparency of Japanese Law Project Transparency Proposal, 2009 United Nations Paris Convention for the Protection of Industrial Property (CUP), 20 March 1883 The Berne Convention for the Protection of Literary and Artistic Works (CUB), 1886 WIPO Madrid Agreement Concerning the International Registration of Marks, 1891 WIPO Hague Agreement Concerning the International Deposit of Industrial Designs, 1925 Universal Declaration of Human Rights, 1948 UNESCO Universal Copyright Convention, 1952 WIPO International Convention for the Protection of Performers, Producers of Phonograms and Broadcasting Organisations, 1961 International Covenant on Civil and Political Rights, 1966

338

Table of Treaties, Conventions and Other Instruments

International Covenant on Economic, Social and Cultural Rights, 1966 Convention Establishing the World Intellectual Property Organization (WIPO), 1967 Vienna Convention on the Law of Treaties, 1969 Convention for the Suppression of Unlawful Seizure of Aircraft, 1971 UNESCO Convention for the Protection of Producers of Phonograms against Unauthorised Duplication of their Phonograms, 1971 Law of the Sea Convention, 1982 WIPO Treaty on Intellectual Property in Respect of Integrated Circuits, 1989 ILO Convention concerning Indigenous and Tribal Peoples in Independent Countries, 1989 Protocol Relating to the Madrid Agreement Concerning the International Registration of Marks, 1989 Convention on Biological Diversity (CBD), 1993 UNIDROIT Convention on Stolen or Illegally Exported Cultural Objects, 1995 UNESCO Inter-American Conventions on Copyright, Montevideo Copyright Convention, 1996 WIPO Performances and Phonograms Treaty (WPPT), 1996 International Law Commission, Draft Articles on Responsibility of States for Internationally Wrongful Acts, 2001 UNESCO Convention for the Safeguarding of Intangible Cultural Heritage, 2003 UNESCO Convention on the Protection and Promotion of the Diversity of Cultural Expression, 2005 United Nations Declaration on the Rights of Indigenous Peoples, 2007 Security Council Resolution 1846, 2008 Security Council Resolution 1897, 2009 Security Council Resolution 1918, 2010 Security Council Resolution 1950, 2010 Nagoya Protocol on Access to Genetic Resources and Fair and Equitable Sharing of Benefits Arising from their Utilization to the Convention on Biological Diversity, 2010 WTO TRIPS, 1994 Other Uniform Domain Name Dispute Resolution Policy Internet Corporation for Assigned Names and Numbers, 1999 Inter-American Convention on Jurisdiction in the International Sphere for the Extraterritorial Validity of Foreign Judgments, 2004 Framework Convention on the Value of Cultural Heritage for Society, 2011 Washington Declaration on Intellectual Property and the Public Interest, 2011

Index Abuse of forum shopping 72, 239, 301 Academic sets of principles 5, 27, 38, 62 ff. Access to court, right of 48, 135, 264 Act of State 42, 100 Administrative procedures, authorities, requirements, formalities, acts, offices 2, 46, 98, 103, 107 ff., 144 ff., 162, 236, 268 Alternative means of recourse 276 ff. Amendment of registers 49, 235 ff. Arbitrability 50 Assignability 10 Best placed courts 49, 215 Biopiracy 150 Centralised – enforcement body 19 – jurisdiction 193 Civil proceedings 268 Cyberattacks 150 Cybertravel 41, 138 Collateral estoppel 232 Collectiveness 151, 156 ff. Comity 42, 100 Community rights 2, 19, 74, 87, 298 Consolidation of claims, objective or subjective 23, 50 ff., 116, 189 ff., 253 Contracts 10, 50 Contributory infringement, liability 85 Country – of origin 28, 30 ff, 162, 167, 199 ff., 225 – of protection 29, 193 – of registration 77, 91 ff., 220, 237 Courts 40 Court’s authority 68, 96, 190, 195 Costs – of applying foreign laws 216

– of duplicating proceedings 132, 233, 242 – of making individual applications or filings 2, 115 – of litigation 19, 254, 281 ff. – of validation 24 Cross-border – injunctions 18, 45, 52 ff., 84, 101, 105, 127, 192, 224, 239, 253, – adjudication, enforcement, litigation 3 ff., 16, 49, 60 ff., 78 ff., 131, 168, 206, 231 ff., 243, 253, 281, 295 Customary international law 55 ff., 97 Damage 189 ff. Declining of jurisdiction 290 ff. De minimis rule 203 Denial of Justice 135, 245 ff. Deposit 2, 11 ff., 33, 73, 82, 91, 115, 215 Deviations from the territoriality principle 188, 199, 204 Difficulties of applying foreign laws 49, 216 Disclosure 31 Directed 193 Divergent outcomes 94, 132, 242, 254, 282 Domestic policies 7, 43, 122 Domicile 15, 17, 22, 42 ff., 51, 63, 66 ff., 74 ff., 80 ff., 168, 173, 175, 185, 188, 190 ff., 216, 241 ff., 249 ff., 250, 252 ff., 283 ff., 298 ff. Double actionability rule 49 ff., 212 ff. Duplication of proceedings 39, 132, 170, 242, 252 ff., 281 ff., 297 Economic inequalities 4, 299 Employment 10, 45, 100, 200, 273 ff. Enforcement – of judgments 2, 49, 204, 218, 221, 231

340 – of IPRs 3 ff., 13, 19, 36, 52 49, 60 ff., 78 ff., 131, 168, 206, 231 ff., 243, 253, 281, 295 Entitlement 10, 51, 237 Estoppel 232 EU IPRs 2, 19, 74, 87, 298 Existence 10 ff., 55 ff., 64, 81, 88 ff., 96, 148, 171, 174, 178 ff., 187, 201 ff., 215 ff., 226 Exclusive Jurisdiction in relation to companies’ claims 79 ff. Exorbitant jurisdiction 9, 134 ff, 264, 301 Extinction 179 Filing 2 ff., 155, 147, 229 Folklore 27, 144 ff., 158 Forum – necessitatis 48, 60, 169, 247 ff., 290 ff – non conveniens 16, 49, 101, 124, 141, 180, 206, 238 ff. – shopping 72, 239, 300 Fraud 224, 301 General – jurisdiction 50, 186, 285 – principles of law 55, 250, 256 ff. Genetic resources 27, 144 ff., 158 Geolocation 40, 138 Granting State 33, 47, 68, 114 ff., 126, 131, 162 ff., 186, 217 ff., 227 ff., 269, 297 Hague Preliminary Draft 27 ff. Harmonisation 1 ff. Human right – to intellectual property 153, 245, 264 ff., 281 ff., 292 – to access to a court 48 – to culture 138 – solution 287 Immovable property 17, 49, 60, 147, 162, 207 ff., 254 Inequalities 4, 299 Individualism 151, 156 ff. Intellectual property 27 ff. Infringement – proceedings, jurisdiction 49 ff., 62 ff., 69, 97, 188, 199 – place 89

Index Injunctions 18, 45, 52 ff., 84, 101, 105, 127, 192, 224, 239, 253 Intangible Cultural Heritage 27 ff., 138 ff. Intentionally directed 193 International Law Association Committee 27 ff. Internet 1, 37 ff., 40 ff., 43, 138, 140, 153, 189, 191, 196 ff., 203, 211, 223 IPRs granting 10, 27 ff., 88, 96 Issue Preclusion 231 Judgments 27 ff. Judicial – economy 49, 215 ff. – settlements 50 Justiciability 13 ff., 27, 43, 63, 69, 122, 207, 209, 218 Lis pendens 50, 72 Local actions doctrine 49, 207 Mandatory rules 221 ff. Market impact rule 191, 193 Misappropriation 13, 27 ff., 139 ff., 148 ff., 158 ff. Moçambique rule 49, 65, 75, 122, 126, 163 ff., 173, 207 ff. Multi-State infringement 152, 189, 195 ff., 299 ff., 202 Multiple defendants 7, 23, 116 Nationality 47, 138, 168, 173, 185 ff., 191, 249, 255, 271, 278 Negative declarations of non-infringement 71 ff. Overprotection of IPRs 3, 50 Ownership 10 ff., 51, 89, 93, 105, 155, 171, 177, 200 ff., 229, 233, 237 Parallel – IPRs 232 – Proceedings 8, 282 – Application 2, 19 Personal jurisdiction 5, 43, 63, 68, 76, 88, 239, 283 Place – of the action 176 ff., 194 ff. – of the result 176, 188, 190, 192, 193, 196

Index – of the infringement 51, 53, 195, 197 ff. Piracy 148, 150 ff. PIL solution 287 Portfolio of national and EU rights 2 Proximity – reasons 180 ff. – principle 180 ff. Preclusion 231 Pre-emptive action 79 Primary IP law 51 Private International Law 27 ff. Prorogation of jurisdiction 50 ff. Protection 27, 148 ff. Protective measures 39 ff. Proprietary IP law 51 Provisional measures 40, 50 ff., 84, 192, 234 Public Policy 94 ff., 99, 111 ff., 127 ff., 162 ff., 218 ff, 221, 236 ff., 259, 261 Pure infringement claims 13, 59, 69 ff., 97 ff. Purely domestic cases 3, 50, 267, 277 Recognition of judgments 2, 49, 204, 218, 221, 231 Reflexive effects 15, 84, 95, 284, Registered intellectual property rights 5, 27, 32 ff. Registration 10 ff., 27, 45 ff., 68 ff., 88, 96, 119, 124, 146, 215, 220, 229, 231, 233 ff., 252, 268, 297 Remedy 22, 172, 203, 225 ff., 246, 290 ff. Rendering State 27, 40, 219 Requested Country 27, 40, 159, 219, 221, 225, 233 ff., 251 Responsibility 290 ff. Revocation 10, 27 ff., 88, 96, 178 Res judicata 93, 229, 231 ff. Residence 51, 92, 138, 168, 185 ff., 188, 191, 249 Scope of rights 10 ff., 71, 95, 164, 170 ff., 177 ff., 197, 213, 223, 227 ff.

341 Secondary IP law 51 Settlements 40, 50, 54, 147, 239 Sound administration of justice 49, 215 ff. Sovereignty 7, 43 ff., 94, 114 ff., 138, 170, 184 ff., 209, 269, 273 ff., 295 Special jurisdiction 51, 53 Spill-over effects 4, 299 State immunity 9, 273 ff. Stay of proceeding 42, 47, 72, 78, 81, 143, 226, 285 Subject matter jurisdiction 5, 10, 13 ff., 27, 42, 65, 68, 76, 88, 96, 108, 128, 136, 161, 207, 212, 217 ff., 283 ff. Sui generis IPRs 28, 139 ff., 147 ff., 158 Super torpedoes 83 Territoriality principle 29, 36, 42 ff., 48 ff., 137 ff. Torpedoes 72 Torts 188 ff. Traditional knowledge 27, 144 ff., 158 Transfer (contractual) 15, 21, 38, 45, 188, 236 ff. Transferability 10 ff., 15, 177, 203, 229 Ubiquitous infringements 176, 194 ff., 229 Ubiquity theory 54, 188, 190, 193, 197 Unfair competition 28, 40, 114 Unified Patent Litigation System 19, 299 Universal jurisdiction 138, 150 ff., 157, 296 Universality 137 ff. Uniform European Union Patent 19, 299 Unregistered intellectual property rights 5, 27, 32 ff. Validity 5, 10, 22, 27, 88, 95, 172, 177, 178, 227, 295 ff. – claims incidentally raised 5, 10 ff., 62 ff., 77, 97 ff., 295 ff. – claims principally raised 5, 62 ff., 10 ff., 90 ff., 97, 98 ff. , 295 ff. Voluntary compliance 218