Stop Press: CJEU Clarifies Jurisdictional Issues in Cross-Border Patent Disputes – Electrolux (C-339/22)

Today, the CJEU has delivered a landmark decision in the BSH v Electrolux case (C-339/22), providing important guidance on jurisdictional rules for cross-border patent disputes under the Brussels I bis Regulation. The decision confirms that:

• A patent holder can sue for infringement in the courts of the EU member state where the defendant is domiciled, even if the patent was granted in another EU country. A validity challenge raised as a defence does not strip the court of its jurisdiction over infringement.
   
• Only the courts of the EU member state where the patent was granted have (exclusive) jurisdiction to rule on their validity. If an alleged infringer raises a validity defence, the court hearing the infringement case cannot rule on that defence or declare foreign EU patents invalid. The defendant must bring separate revocation proceedings in the granting state. In such circumstances, the court hearing the infringement case may grant a stay if it considers it to be justified but is not obliged to do so.
   
• The CJEU confirmed that Article 24(4) of the Regulation does not apply to patents granted outside the EU (e.g. in the UK, Turkey, or even further afield as the Court has not restricted its judgment to European patents granted by the EPO). This means that an EU court where the defendant is domiciled can decide infringement claims involving non-EU patents. To the extent that validity is raised as a defence, the court can assess the validity of non-EU patents with inter partes effect (i.e. it will not formally invalidate the patent in the third country). Thus, EU courts have broader jurisdiction to consider non-EU IP rights than they do to consider EU IP rights, contrary to the approach that the Advocate General had recommended.
   
• Only where an equivalent provision to Article 24(4) of the Regulation had been incorporated into an international treaty as between the country in which the patent was granted and the EU as whole (as in the Lugano Convention), or the EU member state in question, is the EU court required to decline jurisdiction in relation to validity. No such treaty is in place in relation to Turkey (the subject of the current dispute).
   
• Where a related case is already ongoing in a non-EU country, EU courts may stay or dismiss proceedings under Articles 33 & 34. However, this is discretionary, and the EU court must assess whether there is a risk of conflicting judgments and whether staying proceedings would serve the proper administration of justice.

The decision attempts to strike a balance between efficiency in infringement litigation and respect for national sovereignty over patent validity, although not everyone will agree that the right balance has been achieved. The approach adopted aims to prevent defendants from using validity challenges to derail infringement claims while allowing patent holders to consolidate enforcement actions in a single EU jurisdiction, although use of validity challenges to derail cross-border claims is potentially available for patents granted within the EU.

However, several questions remain unanswered such as the role of UPC in a world where consolidated actions can now be brought nationally, the circumstances in which an EU Court would factor in a validity decision from a non-EU court, and practical questions such as how EU Courts will assess foreign law of non-EU patents.

Our full analysis is coming soon so stay tuned! 

Podcast

But in the meantime, hear from patent litigators Andrew Bowler and Gregory Bacon - as they discuss the three questions referred by the Swedish Court of Appeal to the European court in this case - below.

Note: All information was correct at the time of recording.