Opinion that Advocate General Emiliou has delivered a second Opinion in Case C‑339/22, BSH Hausgeräte v Electrolux, a private international law case that concern jurisdictional issues concerning non-EU Member States patents under the Brussels I bis Regulation on jurisdiction and the recognition and enforcement of judgments in civil and commercial matters. The case has been referred to the Court by the Patent and Market Court of Appeal (Patent- och marknadsöverdomstolen), sitting within the Svea Court of Appeal (Svea hovrätt) in Sweden.
The dispute
The concerns proceedings between BSH Hausgeräte GmbH, a company incorporated under German law, and Electrolux AB, a company incorporated under Swedish law, concerning the jurisdiction of the Swedish courts to hear an action for infringement of a European patent in which an exception of invalidity of that patent is raised for the parts of it which have not been validated in Sweden.
BSH Hausgeräte (in Germany) alleges that Electrolux (in Sweden) is infringing on a European patent granted by the European Patent Office (EPO) for several EU Member States and Turkey.
The cases up questions about jurisdiction over EU Member State patents, such as 1) whether Swedish courts can adjudicate on patents from other EU Member States, and 2) whether Swedish courts can adjudicate on patents from third states, specifically Turkey.
The unusual procedural aspects of the case
This case is unusual in that it was initially assigned to Fourth Chamber of the Court. After holding an oral hearing, and the delivery of the Opinion of Advocate General Emiliou on 22 February 2024, the Fourth Chamber then sought to relinquish the case, and instead, have the case heard by the Grand Chamber of the Court.
In his first Opinion, Advocate General Emiliou stated that, the referring court sought clarification, first, about the jurisdiction of the courts of the Member States of the European Union, to hear actions concerned with the infringement of patents registered in other Member States, particularly where the validity of the patents allegedly infringed is challenged by the opposing party. Second, he said the case was an opportunity for the Court to clarify whether Member State courts have jurisdiction to hear proceedings concerned with the validity of patents registered in non-EU Member States, and whether certain rules of the Brussels I bis Regulation (Regulation 1215/2012) apply. The Brussels I bis Regulation determines the jurisdiction of courts in civil and commercial matters within the EU.
By Order of the President, following the internal proposal of the Fourth Chamber after receiving the first Opinion of Advocate General Emiliou, the case was reassigned to the Grand Chamber, and the oral part of the proceedings were reopened. A new oral hearing was held, and Advocate General Emiliou delivered his second Opinion in the case. This time, however, he focused the Opinion on this second part.
The second Opinion of the Advocate General
Advocate General Emiliou considered three main approaches to address the jurisdictional issues concerning non-EU Member States patents under the Brussels I bis Regulation.
Key provisions he looked at were Article 4(1) of the Regulation, and Article 24(4) of the Regulation.
Article 4(1) of the Regulation generally allows courts in the defendant’s domicile to have jurisdiction over foreign patents, including third-state patents. As it states,
‘Subject to this Regulation, persons domiciled in a Member State shall, whatever their nationality, be sued in the courts of that Member State.’
Article 24(4) of the Regulation states,
‘The following courts of a Member State shall have exclusive jurisdiction, regardless of the domicile of the parties:…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 Member State in which the deposit or registration has been applied for, has taken place or is under the terms of an instrument of the Union or an international convention deemed to have taken place.’
Approach #1: Unconditional Application of Article 4(1) of the Regulation
According to Advocate General Emiliou, this first approach of applying Article 4(1) of the Regulation as is, whilst straightforward could conflict with customary international law.
For him, this would limit the adjudicatory jurisdiction of states, and could lead to practical issues, such as judgments on the validity of third-state patents not being recognised in those states, rendering them ineffective.
Approach #2: Reflexive Effect Theory
Under a second approach, EU Member State courts could have the option not to exercise jurisdiction over non-EU Member State patents, reflecting the exclusive jurisdiction rule for EU Member State patents. For him, this respects the limits of the text of the Regulation, and allows courts to decline jurisdiction based on national law, providing flexibility to consider the circumstances of each case. At the same this, this reflexive effect theory would impinge upon overall legal certainty.
Approach #3: A ‘third way’
Advocate General Emiliou proposed a novel ‘third way’. This was the possibility of interpretting Article 4(1) of the Regulation to exclude jurisdiction over the registration or validity of non-EU Member States patents, limiting courts to incidental questions in infringement actions.
For him, there were numerous merits to this approach. First, it would align with customary international law, which restricts EU Member State courts from ruling on the validity of patents registered in other states. Second, it would ensure consistency between intra-EU and third-state matters. Third, it would avoid the need for courts in EU Member States to assess whether to decline jurisdiction.
Which approach?
Advocate General Emiliou ultimately recommended a combination of the reflexive effect theory (Approach #2) and the third way (Approach #3).
This would mean, first, under Article 4(1) of the Regulations, EU Member State courts where the defendant is domiciled would not have jurisdiction to hear and determine actions concerning the registration or validity of patents registered in third states.
But nonetheless, if an infringement action arose, an EU Member State court could consider the validity of a non-EU Member State patent as a preliminary issue, but only for the purpose of resolving the main issue of infringement. The EU Member State’s courts findings on validity would not have erga omnes (universal) effect.
This would in turn mean that decision of an EU Member State court on a patent’s validity would be limited to the parties involved and would not affect the patent’s status in the non-EU Member State.
Operative part of the Opinion
This mixed approach for him meant the referring court should be given the following answer:
‘[Article 24(4) of the Regulation]…must be interpreted as meaning that that provision does not apply in respect of the validity of a patent registered in a third [s]tate. However, the courts of the [EU] Member States, where they have jurisdiction under another rule of that regulation, are entitled to not adjudicate on that issue.’
Read the Opinion
The second Opinion of Advocate General Emiliou in Case C‑339/22, BSH Hausgeräte v Electrolux, delivered on 5 September 2024 can be read here.