“…it is not axiomatic that any proceedings that raise an issue about the validity of the constitution of a company or the validity of a decision of its organ must necessarily be most soundly dealt with by the court of the state where the company has its seat, particularly if the parties have chosen another jurisdiction to solve their disputes…”
“To start with, I cannot accept the argument that Article [27] is only concerned with claims, meaning the assertions made by the party who initiates the proceedings. It must be concerned with what is in issue before the court. In some patent infringement proceedings it is really only validity which is in dispute. The function of Article [27] appears to me to be to ensure that litigation covered by the exclusive jurisdiction provisions of Article [24] are determined in the court having exclusive jurisdiction. If Mr Silverleaf was right, which court would have jurisdiction would be determined by which party managed to commence proceedings first. In the absence of binding authority, I also do not accept the second argument as to the meaning of ‘principally concerned’. I can see no reason to give the Article a narrow linguistic interpretation. The Jenard report suggests that what is excluded is incidental matter. Something which is a major feature of the litigation is not incidental and is therefore a matter with which the action is principally concerned. The issue which has to be decided then is whether the three foreign claims sought to be raised in the English courts are principally concerned, in this broad sense, with the issue of validity of the foreign patents.”
“As I have said, validity is frequently in issue, and sometimes the most important issue, in English patent infringement proceedings. This is now enshrined insection 74(1)(a) of the Patents Act 1977 . We have always taken the view that you cannot infringe an invalid patent. This was restated by Aldous J. in the passage from Plastusquoted above. However the fact that the defendant can challenge validity does not mean that he will. In Plastushe did not. Until he does, only infringement is in issue and the approach in Pearceapplies. The court cannot decline jurisdiction on the basis of mere suspicions as to what defence may be run. But once the defendant raises validity the court must hand the proceedings over to the courts having exclusive jurisdiction over that issue. Furthermore, since Article [27] obliges the court to decline jurisdiction in relation to claims which are ‘principally’ concerned with Article [24] issues, it seems to follow that jurisdiction over all of the claim, including that part which is not within Article [24] must be declined. It may well be that if there are multiple discrete issues before a court it will be possible to sever one or more claims from another and to decline to accept jurisdiction only over those covered by Article [24], but I do not believe that that approach applies where infringement and validity of an intellectual property right are concerned. They are so closely interrelated that they should be treated for jurisdiction purposes as one issue or claim.”
“[19] Article [27], which, in certain language versions, refers to a claim being brought ‘principally’, does not provide further clarity. Apart from the fact that the degree of clarity of the wording of that provision varies according to the particular language version, that provision, as the Commission has observed, does not confer jurisdiction but merely requires the court seised to examine whether it has jurisdiction and in certain cases to declare of its own motion that it has none. [20] In those circumstances, Art.[24(4)] must be interpreted by reference to its objective and its position in the scheme of the [Regulation]. [21] In relation to the objective pursued, it should be noted that the rules of exclusive jurisdiction laid down in Art.[24] of the [Regulation] seek to ensure that jurisdiction rests with courts closely linked to the proceedings in fact and law. [22] Thus, 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 (Djuinstee, [22]). The courts of the Contracting State on whose territory the registers are kept may rule, applying their own national law, on the validity and effects of the patents which have been issued in that State. This concern for the sound administration of justice 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. [23] That exclusive jurisdiction is also 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, [1979] O.J. C59/1 at 36). [24] In relation to the position of Art.[24] within the scheme of the [Regulation], it should be pointed out that the rules of jurisdiction provided for in that article are of an exclusive and mandatory nature, the application of which is specifically binding on both litigants and courts. Parties may not derogate from them by an agreement conferring jurisdiction (fourth paragraph of Art.[25] of the [Regulation]) or by the defendant's voluntary appearance (Art.[26] of the [Regulation]). Where a court of a Contracting State is seised of a claim which is principally concerned with a matter over which the courts of another Contracting State have jurisdiction by virtue of Art.[24], it must declare of its own motion that it has no jurisdiction (Art.[27] of the [Regulation]). A judgment given which falls foul of the provisions of Art.[24] does not benefit from the system of recognition and enforcement under the Convention ([Art.45(1)(e)] and [Art.46] thereof). [25] In the light of the position of Art.[24(4)] within the scheme of the [Regulation] and the objective pursued, the view must be taken that the exclusive jurisdiction provided for by that provision should apply whatever the form of proceedings in which the issue of a patent's validity is raised, be it by way of an action or a plea in objection, at the time the case is brought or at a later stage in the proceedings. [26] First, to allow a court seised of an action for infringement or for a declaration that there has been no infringement to establish, indirectly, the invalidity of the patent at issue would undermine the binding nature of the rule of jurisdiction laid down in Art.[24(4)] of the [Regulation]. [27] While the parties cannot rely on [Art.24(4)] of the [Regulation], the claimant would be able, simply by the way it formulates its claims, to circumvent the mandatory nature of the rule of jurisdiction laid down in that article. [28] Secondly, the possibility which this offers of circumventing [Art.24(4)] of the [Regulation] would have the effect of multiplying the heads of jurisdiction and would be liable to undermine the predictability of the rules of jurisdiction laid down by the [Regulation], and consequently to undermine the principle of legal certainty, which is the basis of the [Regulation] (seeCase C-256/00 Besix SA v Wasserreinigungsbau Alfred Kretzschmar GmbH & Co KG [2002] E.C.R. I-1699 [24] to [26],Case C-281/02 Owusu v Jackson [2005] E.C.R. I-1383 [41], andCase C-539/03 Roche Nederland and Others v Primus and Goldenberg [2006] E.C.R. I-0000 [37]). [29] Thirdly, to allow, within the scheme of the [Regulation], decisions in which courts other than those of a State in which a particular patent is issued rule indirectly on the validity of that patent would also multiply the risk of conflicting decisions which the [Regulation] seeks specifically to avoid (see, to that effect,Case C-406/92 Tatry [1994] E.C.R. I-5439, [52], and Besix, cited above, [27]).”
“[63] The ECJ held that article [24(2)] was not to be interpreted as embracing all proceedings where a decision of an organ of a company was being challenged; that would give too wide an interpretation to article [24(2)] and would undermine the supremacy of the general jurisdictional regime of the Regulation.”
“[66] Laddie J noted that he had not been shown any case in which the meaning of ‘principally concerned’ in article [24] had been considered. He was not referred to either the Newtherapeutics case or the Grupo Torras case on the relationship between article [24]and article [27]. Nor was he shown ECJ decisions which held that the provisions of article [24] must not be given an interpretation that was broader than was required by their objective. Therefore, with respect, Laddie J was incorrect to state, [at 676], ‘I can see no reason to give the article a narrow linguistic interpretation,’ whether that remark is aimed at article [24]or article [27] or both. Nor, in my view, does it follow, as Laddie J seemed to think, that if an issue in litigation is not incidental it must be a ‘major feature of the litigation’ which must therefore be ‘a matter with which the action is principally concerned’. Laddie J did not deal directly with the correct construction of the words ‘concerned with’ in article [24(4)]. So, in my view, the comments of Laddie J concerning the interpretation of article [24(4)] and its relationship with article [27] have to be treated with caution. [67] However, Laddie J went on to hold that where infringement of a patent and the validity of a patent were raised in proceedings they were so closely related that they should be treated ‘for jurisdiction purposes’ as one issue or claim. He demonstrated how an attack on the validity of a patent would directly impinge on the issue of infringement. … . [68] Laddie J's analysis of the relationship between an allegation of infringement of a patent and a defence of invalidity of the patent for the purposes of article [24(4)] was approved by the Court of Appeal in Fort Dodge Animal Health Ltd v Akzo Nobel NV[1998] FSR 222 ,paras 30-31. Therefore in an action in which the claimant alleged patent infringement by the defendants and the defendants alleged that the patent was invalid, if the alleged infringing acts fell within the ambit of the claim to a patent for the purposes of article [24(4)] the claim was ‘principally concerned’ with the validity of the patent, which in that case was a UK patent. [69] In my view the statements of Laddie J and the Court of Appeal are relevant only to cases in which infringement and validity of a patent were raised. They are analysed as being cases where there was only one issue or claim involved. Therefore there was no need, in either case, for either court to consider how article [24(4)] or article [27] had to be interpreted when a case involved multiple issues. [70] The analyses of Laddie J and the Court of Appeal on the relationship between issues of infringement and validity of a patent for the purposes of articles [24(4)] and [27]appear to have been implicitly approved by the ECJ by its decision in the GAT case[2006] ECR I-6509 . … ”
“[83] The proper interpretation of article [24(2)] has to be derived from its wording, its objective, its position in the scheme of the Regulation, the ECJ decisions on article [24] and its predecessor, the commentary of Mr Jenard and the English cases on the article. My conclusions on its interpretation are as follows. First, I think we are bound by English Court of Appeal authority to interpret the words ‘proceedings which have as their object’ in article [24(2)] as ‘proceedings which are principally concerned with’. Although the Court of Appeal in the Grupo Torras case[1996] 1 Lloyd’s Rep 7 stated that the words could also mean ‘proceedings which have as their subject matter’, I prefer the former formulation because it links with the wording in article [27], ie, ‘a claim which is principally concerned with’. That interpretation also accords with the French text. That construction is entirely consistent with the analysis of Mr Jenard to which I have referred above. [84] Secondly, I reject the submission of Mr Lord that the opening phrase of article [24(2)] must be read in such a way that if proceedings raise any issue within article [24(2)], ie, if the proceedings are concerned with the validity of the constitution of a company (etc) or the validity of the decisions of its organs (etc), then that is sufficient to make those proceedings ‘principally concerned with’ that issue. There is nothing in the wording of the article to warrant that broad interpretation. It is not consistent with the interpretation suggested by Mr Jenard, who talks of the proceedings being ‘in substance concerned with’ the items set out in article [24(2)]. The ECJ has stated more than once that article [24] generally is to be given an interpretation no broader than is necessary to fulfil its objective of ensuring that the sound administration of justice is achieved by giving exclusive jurisdiction to the courts of the state concerned with the relevant land, company, public registers, patents and so forth. But it is not axiomatic that any proceedings that raise an issue about the validity of the constitution of a company or the validity of a decision of its organ must necessarily be most soundly dealt with by the court of the state where the company has its seat, particularly if the parties have chosen another jurisdiction to solve their disputes. The validity issue may be one of many other issues which have nothing to do with the validity of the company or the validity of decisions of its organs, and those other issues may have to be decided by a different applicable law and may concern facts which are unrelated to the state where the company has its seat. In such a case the sound administration of justice could well require the courts of another state to determine the issues. That is even more so when the parties have agreed a jurisdiction for the resolution of disputes. This conclusion is, I think, clearly supported by the approach of the ECJ in the Land Oberösterreich case and in the Hassett case. [85] Thirdly, I reject the submission of Mr Lord that if proceedings raise a number of issues and one of them is within the terms of article [24(2)] and the resolution of that issue may be dispositive of the proceedings as a whole, that must mean that the proceedings are ‘principally concerned with’ an issue within article [24(2)]. Again, that is not what the article states. It is inconsistent with Mr Jenard's commentary. If the test is: what are the proceedings ‘principally concerned with’, as the English Court of Appeal has held, then one issue which may be dispositive may be what the proceedings are principally concerned with, but it is not necessarily the case. No ECJ decision has given the article that interpretation. The GAT case does not support this proposition because that was a patent case and, as the ECJ makes clear in its judgment, when an infringement claim raises the issue of validity of the patent they are really two aspects of one issue. The Coin Controls and Fort Dodge cases are to the same effect. For the reasons I have already set out neither does the Land Oberösterreich case[2006] ECR I-4557 support Mr Lord's submission. [86] There are no other English cases which support this submission of Mr Lord. In my view the statements of Knox J in the Newtherapeutics case[1991] Ch 226 are contrary to his submission. Although the judge accepted that the company could win the action on either of the two issues raised, Knox J was concerned to find the principal issue in the proceedings, as Teare J noted[2010] QB 276 , para 29. Further, the whole approach of Mance J in the Grupo Torras case[1995] 1 Lloyd’s Rep 374 is contrary to Mr Lord's submission. Mance J held, at pp 403–404, that article [24(2)] called for an exercise in ‘overall classification’ and an ‘overall judgment’, by which the court attempts to assess whether the proceedings are so closely connected with matters of local company law and internal corporate decision-making that the proceedings should not be tried anywhere else but in the courts of the state of the company's seat. The Court of Appeal[1996] 1 Lloyd's Rep 7 endorsed this overall approach. It means that if a court is faced with a dispute on whether article [24(2)] applies it has to decide on the principal concern of the proceedings overall. I do not accept that the statement of Chadwick LJ in Prudential Assurance Co Ltd v Prudential Insurance Co of America[2003] 1 WLR 2295 ,para 25 is support for the proposition that, for article [24(2)] purposes, one set of proceedings can be principally concerned with several issues. Chadwick LJ was not dealing with such an argument in that case. Article [31] of the Regulation does not itself address the question of how to determine what a particular action is concerned with to see whether the exclusive jurisdiction provisions of article [24] apply or not. [87] Fourthly, given my view that the Court of Appeal in the Grupo Torras case[1996] 1 Lloyd’s Rep 7 did endorse the approach of Mance J that a court has to undertake an exercise in ‘overall classification’ and make an ‘overall judgment’ to see whether the proceedings are ‘principally concerned’ with one of the matters set out in article [24(2)], we are bound to follow that interpretation unless there has been a subsequent decision of the ECJ (or House of Lords) which has stated a contrary interpretation. There is none. [88] In any case, in my respectful view the interpretation of Mance J was correct. It fits with the wording of article [27]. It also fits with the objective of article [24] which is to give exclusive jurisdiction to the courts of the state which will be best suited to dealing with the relevant issue, depending on which paragraph of article [24] is in play. It is only necessary to displace the general rule as to jurisdiction or the parties' own agreed jurisdictional choice if, making an overall judgment, it is clear that granting jurisdiction to the courts of the relevant state (where the land is, where the company has its seat, where the patent is registered, etc) will result in the sound administration of justice. In the context of article [24(2)] this will not be the case unless, overall, the proceedings are so closely connected with matters of local company law and internal corporate decision-making in respect of the company that the proceedings should not be tried anywhere but in the courts of the state where the company has its seat. [89] Fifthly, whilst I respectfully accept that Mr Jenard must be right in saying that if an issue within article [24(2)] is only a ‘preliminary or incidental matter’ in some proceedings, they cannot be ‘principally concerned’ with article [24(2)], the converse does not follow. Even if an issue within article [24(2)] is not simply a ‘preliminary’ or ‘incidental’ matter, it does not necessarily mean that, looking at the proceedings overall, they are proceedings which are ‘principally concerned’ with article [24(2)] matters. That will depend on the overall classification or overall judgment. In so far as Laddie J may have come to the opposite conclusion in the Coin Controls case I think he was wrong. [90] Therefore I conclude that Teare J reached the right conclusion on the interpretation of article [24(2)], as stated at para 46 of his judgment. Put in the context of this case, I agree with him that the question is whether the English proceedings are ‘in substance or principally concerned with the ultra vires issue raised by BVG by way of defence to JPM's claim’.”
“[46] It is clear in my judgment that Laddie J. held that where it is clear that validity ‘is to be’ put in issue (i.e. in the future) the court should decide the application on the basis that validity is one of the issues in the case. It is not necessary for the allegation of invalidity to be formally pleaded. I respectfully agree. If the current action were to be stayed, what would prevent KBS UK starting a new action tomorrow alleging invalidity as well as non-infringement? Even if Haldex rushed off to the Landgericht, that court would have to decline jurisdiction once the allegation of invalidity of the UK designations of the European patents had been raised here. I cannot see the point of that. In my judgment the challenge to validity of the patents has been raised, with the consequence that, unless KBS is bound by the non-challenge clause, this court has exclusive jurisdiction.”
“[22] However, in order to enhance the effectiveness of exclusive choice-ofcourt agreements and to avoid abusive litigation tactics, it is necessary to provide for an exception to the general lis pendens rule in order to deal satisfactorily with a particular situation in which concurrent proceedings may arise. This is the situation where a court not designated in an exclusive choiceof-court agreement has been seised of proceedings and the designated court is seised subsequently of proceedings involving the same cause of action and between the same parties. In such a case, the court first seised should be required to stay its proceedings as soon as the designated court has been seised and until such time as the latter court declares that it has no jurisdiction under the exclusive choice-of-court agreement. This is to ensure that, in such a situation, the designated court has priority to decide on the validity of the agreement and on the extent to which the agreement applies to the dispute pending before it. The designated court should be able to proceed irrespective of whether the non- designated court has already decided on the stay of proceedings.”
“The intention is clearly that the court first seised should give way to the court designated in the ‘agreement’, without itself determining whether the jurisdiction clause is valid or applicable. What the reform leaves out, therefore, is the threshold for the application of this rule. It should not be sufficient that a party merely claims (without evidence) that the dispute is covered by an exclusive jurisdiction agreement, otherwise the rule would clearly be open to a variation on the tactical litigation experienced as a result of the Gasser decision, with parties spuriously claiming jurisdiction agreements in favour of, for example, the Italian courts, and commencing proceedings in Italy accordingly, in order to frustrate the jurisdiction of the English courts. Nor should it be necessary to establish that a jurisdiction agreement actually governs the dispute, otherwise this decision would need to be made by any court seised to determine whether the rule applies, which would defeat the objective of the rule. For the rule to apply, there clearly must be some intermediate standard – an ‘apparent’ exclusive jurisdiction agreement, or a ‘prima facie’ exclusive jurisdiction agreement. This question will have to be clarified by the courts and eventually the Court of Justice, and it is unfortunate that it was not addressed more clearly in Brussels I recast.”
“3.1.a The University shall grant Unilever an exclusive and territorially unlimited licence to exploit [the Patents] and corresponding foreign patents … for the following products and sectors: (i) packed food products; (ii) washing and cleaning agents; (iii) cosmetics with a non-medical orientation; and (iv) process auxiliary agents, more specifically the catalytic and separation process auxiliary agents, for use in fields (i), (ii) and (iii) above.”
“9. Applicable law and settlement of disputes 9.1 Belgian law shall govern this Agreement. The Court of Brussels shall alone be competent in case of dispute between the Parties or one of their (sub)licensee(s) concerning this Agreement. 9.2 In exemption from Article 9.1, the Parties hereby also agree that all disputes on the definition of the Reserved Sector, the scope of [the Patents] and its delimitation from the Community Patents shall exclusively be settled by arbitral tribunal consisting of one jurist and two scientists, sitting in Brussels, according to the rules of the International Chamber of Commerce.”
“… the use of Camel antibodies to develop products and processes for predicting, diagnosing, monitoring, preventing and treating diseases in animals and humans…”
“3.1 With effect from … (the ‘Novation Date’): (a) BAC agrees to assume all the obligations and liabilities of Unilever to the University under or arising from the [Unilever Licence] except to the extent that such obligations have been fully and properly discharged before the Novation Date; … (d) [VUB] agrees with BAC to be bound by its obligations under the [Unilever Licence] (to the extent that they have not been fully and properly discharged prior to the Novation Date) in every way as if BAC had been a party to the [Unilever Licence] in place of Unilever, except if explicitly stated otherwise in this Agreement. … 7.1 This Agreement and any dispute or claim arising out of it shall be governed by, and construed in accordance with, Belgian law. All disputes or claims arising out of or relating to this Agreement shall be subject to the non-exclusive jurisdiction of the Courts of Brussels, to which the parties irrevocably submit.”
“4.10 The term (packaged) foodstuff is also unsuitable to serve as a limitation, now that the qualification as foodstuff, as Unilever et al. appears to fail to understand, does not exclude that such a product must also be deemed a medicinal product, while – as Unilever acknowledges – it is precisely medicinal products that are excluded from the licence. In addition, Unilever asserted that its licence did not extend to ‘pills, syringes or powders (products that can be purchased from a pharmacy)’. The location where the products are offered cannot, however, be deemed a suitable delineation. After all, medicinal products are also offered in supermarkets, while foodstuffs (including functional foods) can also be sold in pharmacies and are not to be deemed a medicinal product.”
“4.12 … What keeps the parties divided is what ‘medicinal product’ is to be understood to mean in this respect. As this limitation, which is acknowledged by both parties, is not included in the licence agreement itself, the literal wording of the agreement itself cannot provide any clarity about the contents and meaning of that term – and thus of the scope of the licence. The Court of Appeal sees cause in these circumstances of this case to not only take note of the history of the making of the licence agreement, in order to determine what sense each of the parties could reasonably expect of each other in this respect. This approach is also in accordance with Belgian law that applies to the licence agreement, which stipulates that account must be primarily taken of the common intent of the parties …”
“85. Should this application not succeed and the UK Claim continue the Defendants would intend to raise a number of defences. These include limitation under theLimitation Act 1980 ; invalidity of the patents in suit; lack of infringement due to activities complained of being experimental and covered by the [Unilever] Licence and in particular because V565 is not an antibody to a ‘specific pathogen’; and absence of any common design.”
“33. Mr Troussel informs me that section 1121 of the Belgian Civil Code does allow parties to a contractual arrangement to specify that a particular contractual term can be expressed to be made for the benefit of a third party who is not a party to the contract. Where a contractual term of this nature exists it may be enforced by the third party against the parties to the contract. … Mr Troussel also informs me that under Belgian law that the Belgian Supreme Court has held in Supreme Court27 September 1974 , Arr Cass., 1974-5, 125 that for such a right to be created, the intention of the parties to make such a commitment towards third parties must be clear and unambiguous.”
“13. Other than as stated in paragraph 33 of Ms Macdonald’s witness statement, under Belgian law, if contracting parties decide to confer contractual rights to third parties…it is irrelevant whether that third party relies on that contractual right as a plaintiff or rather to defend itself against a claim issued by another party.”
“Cause of action estoppel arises where the cause of action in the later proceedings is identical to that in the earlier proceedings, the latter having been between the same parties or their privies and having involved the same subject matter. In such a case the bar is absolute in relation to all points decided unless fraud or collusion is alleged, such as to justify setting aside the earlier judgment.”
“[22] Arnold v National Westminster Bank plc[1991 2 AC 93is accordingly authority for the following propositions. (1) Cause of action estoppel is absolute in relation to all points which had to be and were decided in order to establish the existence or non-existence of a cause of action. (2) Cause of action estoppel also bars the raising in subsequent proceedings of points essential to the existence or non-existence of a cause of action which were not decided because they were not raised in the earlier proceedings, if they could with reasonable diligence and should in all the circumstances have been raised. (3) Except in special circumstances where this would cause injustice, issue estoppel bars the raising in subsequent proceedings of points which (i) were not raised in the earlier proceedings or (ii) were raised but unsuccessfully. If the relevant point was not raised, the bar will usually be absolute if it could with reasonable diligence and should in all the circumstances have been raised.”