EAPIL blog

Peter Mankowski is the editor of a Research Handbook on the Brussels Ibis Regulation, juest published by Edward Elgar.

Here’s the blurb.

The Brussels Ibis Regulation is the magna carta for jurisdiction and the free circulation of judgments in civil and commercial matters in the EU, and forms a cornerstone of the internal market. This timely Research Handbook addresses the cutting edges of the regime, in particular its place within the overall system of EU law and its adaptations in response to specific kinds of lawsuits or the needs of particular industries.

Featuring original research by leading academics from across Europe, chapters take a systematic approach to examining a broad variety of topics in relation to the Brussels Ibis Regulation. Such topics include collective redress, injunctive relief, lis pendens and third states, negotiorum gestio, arbitration, intellectual property lawsuits, and its interface with the European Insolvency Regulation (Recast). Moving beyond what is offered by textbooks and commentaries, this incisive Research Handbook analyses the most recent developments in legislation and practice, as well as providing an outlook on the future of this field of EU law.

This Research Handbook will prove a critical read for scholars and students of EU law. Judges and practitioners working in this area will also find its insights to be of significant practical relevance.

Contributors include Tomas Arons, Sylvain Bollée, Tim Dornis, Etienne Farnoux, Thomas Garber, Christian Heinze, Antonio Leandro, Leander D. Loacker, Peter Mankowski, Fabrizio Marongiu Buonaiuti, Johan Meeusen, Dario Moura Vicente, Guillaume Payan, Aukje van Hoek, Cara Warmuth and Matteo Winkler.

For more information see here and here.

Edoardo Rossi is the author of a monograph in Italian titled La Sharing economy nel diritto internazionale privato europeo (Sharing Economy – A European Private International Law Perspective), published by Giappichelli.

The author provided the editors of this blog with an abstract in English. The abstract reads as follows.

In the current economic and social context new and controversial sharing practices, offering anyone the opportunity to search for or make available goods or services on the market regardless of the professional or amateur nature of the persons involved, have emerged. These practices, very heterogeneous and concerning the most different areas of daily life, such as mobility, housing, business activities, communications, work, culture, communication, education and finance, have been linked  to the notion of “sharing economy”, which brings them together by virtue of temporary access to goods or services, facilitated by the large-scale intervention of digital platforms, through which requests and offers are coordinated online in order to share goods or services.

The legitimacy of schemes linked to this new economic models has been challenged in a number of aspects, including low quality of services, safety of consumers, authorisation and licensing, taxes and compliance with competition rules. The inadequacy of the existing rules to deal with the provision of services through the sharing economy models has consequently emerged.

In spite of these critical profiles, the legal relations established through sharing economy platforms are constantly increasing around the world, implying the emergence of elements of transnationality, from which derives the recourse to the rules of private international law, in order to determine the applicable law and the judge competent to rule on any disputes.

The monograph thus attempts to analyse some of the most important private international law issues, such as the inadequacy of the party autonomy in regulating the phenomenon, especially with reference to the general terms and conditions of contract unilaterally drawn up by platform operators, which state that the latter is totally unrelated to the legal relations between users, often in conflict with the minimum level of consumer protection guaranteed by EU law and by the national legislations. Critical profiles have also been identified in the online conclusion of contracts that bind the parties involved in sharing economy legal relations, in ascertaining the effectiveness of consent on the choice of forum and choice of law clauses, in cases of potential related actions and in the location of the “domicile” of the platform operators.

Further information can be found here.

The author of this post is Giulio Monga, a PhD student at the Catholic University of the Sacred Heart, Milan.

On 8 July 2019, Italian Supreme Court (Corte di Cassazione) ruled on the jurisdiction of Italian courts over passengers’ claims for compensation against air carriers established in non-EU countries (order No 18257 of 2019).

The facts

D.M. and R.G., two Italian citizens residing in Italy, purchased tickets to fly from Copenhagen to Havana, and back. The flights were operated by the Russian airline Aeroflot. The tickets were purchased through the Aeroflot website.

The flight to Havana was first cancelled and only replaced with a longer flight the day after. On the return flight, the two passengers’ luggage was mishandled only to be delivered ten days later.

The two sued the Italian subsidiary of Aeroflot for damages before the Justice of Peace of Rome.

Aeroflot challenged the jurisdiction of Italian courts and asked the Supreme Court to give a ‘preliminary’ ruling on jurisdiction, as provided for in Article 41 of Italian code of civil procedure (this is a ruling on jurisdiction alone, which either party may request for as long as the case is not decided at first instance).

Specifically, Aeroflot submitted that the action had no connection with Italy, apart from the nationality and the residence of the plaintiffs. It stressed that the tickets had been purchased through the Moscow-based website of the company and that Italy was neither the country where the contract ought to take place nor the country where the alleged non-performance had occurred.

The legal framework

In its ruling, the Supreme Court began by pointing out that the matter came with the purview of the Montreal Convention of 1999 for the unification of certain rules for international carriage by air.

The Convention, to which Italy is a party, applies to all international carriage performed by aircraft for reward (Article 1(1)). A carriage is ‘international’ for the purposes of the Convention where, among other situations, the place of departure and the place of destination are situated in the territories of two States parties. The latter condition was met in the circumstances, given that the Convention is also in force for Cuba and Denmark.

Jurisdiction over passengers’ rights under the Montreal convention

The Montreal Convention deals with jurisdiction over passengers’ claims for damages in Article 33. Specifically, Article 33(1) provides that an action for damages may be brought, at the option of the plaintiff, before the courts of the following contracting States: the State of the carrier’s domicile, the State of the carrier’s principal place of business, the State where the carrier has a place of business through which the contract was made, or the State of the place of destination of the flight.

In the instant case, the Court noted, the question was whether the defendant, Aeroflot, could be regarded to have a ‘place of business’ in Italy, and whether such place could be considered to be the place of business through which the contracts between Aeroflot and the plaintiffs had been made.

The ‘place of business through which the contract was made’

The Court observed that, where tickets are purchased on-line, the place of business through which the contract was made must be identified regardless of the physical location of the agencies, subsidiaries or branches of the carrier concerned.

Air carriers, the Court remarked, present themselves on the web as commercial operators interacting with users based anywhere in the world. Neither the carrier’s nor the website users’ location or geographical origin are relevant to the transaction, since no physically identifiable intermediation occurs between the passenger and the carrier for the purposes of the purchase.

According to the Supreme Court, the online purchase of tickets challenge the traditional methods of localisation of a contract for jurisdictional purposes.

Against this background, the ‘place of business through which the contract has been made’, as referred to in Article 33(1) of the Montreal Convention, cannot be determined based on the location of the server used for completing the purchase. It would be unreasonable, the Court added, to burden the passenger with the task of assessing the location of the relevant server. Moreover, an inquiry to that effect would lead to uncertain results, and would hardly be consistent as such with the goals of predictability that the rules on jurisdiction, including Article 33(1) of the Montreal Convention, are expected to pursue.

Having stressed that the Montreal Convention must be given an autonomous interpretation, the Court observed that Article 33(1) should be read in light of other provisions in the Convention concerning jurisdiction. By this statement, if the understanding of the author of this post is correct, the Court meant to refer, in particular, to Article 33(2).

The latter provision applies, alongside Article 33(1), to actions for damages ‘resulting from the death or injury of a passenger’. It provides that those actions may also be brought before the courts of the State Party ‘in which at the time of the accident the passenger has his or her principal and permanent residence and to or from which the carrier operates services for the carriage of passengers by air, either on its own aircraft, or on another carrier’s aircraft pursuant to a commercial agreement, and in which that carrier conducts its business of carriage of passengers by air from premises leased or owned by the carrier itself or by another carrier with which it has a commercial agreement’.

While Article 33(2) was inapplicable as such to the circumstances of the case, the Supreme Court apparently relied on the latter provision to construe, consistent with the principles of the Convention, the expression ‘place of business through which the contract was made’ as used in Article 33(1), in particular as regards on-line purchases. The Court argued that in on-line purchases, that place should be understood to correspond to the place where the purchase order is made and the payment is likely to take place: in the Court’s view, that place should in fact be identified with the domicile of the passenger, a connecting factor that complies with the requirements of certainty and foreseeability.

In the Court’s view, one of the general goals underlying the Montreal Convention, as it arises from an overall analysis of the above provisions, is in fact to enhance the protect of the passenger, namely by facilitating access to justice. To corroborate its findings, the Court also referred to the rules of the Brussels I bis Regulation on contracts concluded by consumers, as an example of the kind of protection that jurisdictional rules may want to afford to weaker parties.

In light of all of the foregoing, the Supreme Court concluded that, in the event of tickets purchased online by the passenger himself, the expression ‘place … through which the contract has been made’ in Article 33(1) should be deemed to refer to the place where the passenger becomes aware of conclusion of the contract, that is, in fact, the domicile of the passenger himself. This interpretation, the Court finally contended, complies with the goal of giving adequate protection to the passenger as a weaker party, while ensuring predictability and protecting air carrier against forum shopping.

The raising of a problem child

The creation of the European Patent Court has been fraught with difficulties. After Spain and Italy had impeded its establishment for linguistic concerns, it was embedded in 2013 in an international treaty, the Agreement on a European Patent Court. In March 2017, the German Parliament (Bundestag) passed a law ratifying the Agreement. A mere 35 of its more than 600 members were present at the vote.

A patent lawyer with a constitutional hunch

Patent lawyer Dr Ingve Björn Stjerna from Düsseldorf was unhappy. He saw his right of democratic representation, protected under Art 38 of the German Constitution (Grundgesetz), being violated. That is why he brought a constitutional complaint against the law by which the German Parliament had consented to the Agreement.

A court concerned about German sovereignty

The German Constitutional Court (Bundesverfassungsgericht) affirmed the complaint. It declared the German act assenting the Agreement to be void. In the view of the majority of the Justices, the procedure in which the law had not been adopted was defective. The act would require the consent by at least two thirds of all members of Parliament and of the Federal Council (Bundesrat), which is necessary normally only for amendments to the text of the Constitution (Art 79(2) German Constitution).

The rationale of this ruling was the following: In the Court’s view, the act ratifying the Agreement on the European Patent Court materially alters the German Constitution. By creating a new international court, Germany would transfer sovereign powers, which it would find impossible to regain later. As a result, German citizens would no longer be able to influence the exercise of the state powers through their vote. Hence their right of being democratically represented would be violated.

A dissenting opinion concerned about European integration

The decision was rendered by a 5 to 3 majority. In a dissenting opinion, the minority criticised the Court for having overstretched the right of democratic representation (Art 38 of the German Constitution). The latter would not be put into question by a merely formal mistake in the legislative procedure. Furthermore, the dissenters warned that the position taken by the majority would endanger further European integration, which enjoys constitutional status in Germany.

Assessment

It is remarkable that the Constitutional Court requires a majority of two thirds of the Parliament for the act ratifying the Agreement on a European Patent Act. Can it really be said that this act amounts to a change of the German Constitution? Doubts are in order.

The court also conveniently ignores that judges are not elected representatives. It is therefore strange to invoke the right of democratic representation to invalidate such a law.

Even more peculiar, from an outsider’s view, must seem the fact that a single person can trigger the constitutional review of a legislative act based on merely formal errors. This creates opportunities for putting spanners in the work of the legislative procedure.

The German Constitutional Court’s emphasis on sovereignty is odd and throws a spanner in the works of further European integration. There seems to be an agenda behind this. Mind you that this is the same chamber of the Court that has repeatedly questioned the legality of monetary policy measures by the European Central Bank.

Fortunately, most other Member States do not have courts with similar far-reaching powers and extreme positions. But already, some – like Hungary – are starting to imitate Germany and endow their Constitutional Courts with powers to control the EU and its institutions. If more were to follow that path, this would surely be the end of European integration.

The Upshot

The decision by the Constitutional Court does not make the creation of the European Patent Court impossible. The German Parliament and the Federal Council have to vote for the law once more with two thirds of their members. However, precious time will be lost again.

A free webinar on Force Majeure and Hardship under Cross-border and Comparative Perspectives will take place on 8 April 2020 at 17.00 BST, organised by the British Institute of International and Comparative Law.

Speakers include Alice Decramer (avocat, Signature Litigation Paris), Nicole Langlois (Barrister, XXIV Old Buildings) and Tom Sullivan (partner & attorney, Shook Hardy Bacon, Philadelphia). The webinar will be chaired by Duncan Fairgrieve (Senior Research Fellow in Comparative Law & Director, Product Liability Forum). 

The objective of this webinar is to examine the legal consequences of a party’s inability to perform a contract due to events outside their control, by comparing and contrasting a series of different juridictions including the US, France and the UK. An analysis will be made of the issue of force majeure / and hardship in comparative perspective, looking at the impact of contractual force majeure clauses, and their interpretation by the courts in a series of different juridictions. The seminar will look at supply of goods contracts, as well as commercial contracts more generally. An analysis will be given of the position where there is no specific contractual provision, and reliance is instead placed on frustration / hardship or impracticability. What are the conditions of these doctrines and what is the remedy that might be awarded? Distinguished speakers will examine the issues with a particular focus on the impact of the current circumstances.

More details and advance registration here.

April 2020 opened at the Court of Justice with the publication of two AG’s opinions, as announced: AG Saugmandsgaard Øe‘s on case C-186/19 (so far, not available in English), and AG Campos Sánchez-Bordonas’ on case C- 343/19 (press release here). The latter have already been widely reported in the news (see for instance here, here or here).

The next reading of an Opinion – this one by AG Szpunar –
will take place on 26 April 2020, and will concern case C-73/19, Movic. The question, referred by the Hof van beroep te Antwerpen, is once more about the meaning of the expression “civil and commercial matters” for the purposes of the Brussels I bis Regulation.

Is an action concerning a claim aimed at determining and stopping infringing market practices and/or commercial practices towards consumers, instituted by the Belgian Government in respect of Dutch companies which from the Netherlands, via websites, focus on a mainly Belgian clientele for the resale of tickets for events taking place in Belgium, pursuant to Article 14 of the … Law of 30 July 2013 regarding the sale of admission tickets to events … and pursuant to Article XVII.7 WER, a civil or commercial matter within the meaning of Article 1(1) of the [Brussels I bis Regulation], and can a judicial decision in such a case, for that reason, fall within the scope of that Regulation?

No need to say that, whatever the answer, it will have far-reaching consequences for collective actions.

AG Szpunar’s Opinion on case C-253/19, Novo Banco, is expected one week later. Here, the Tribunal da Relação de Guimarães is asking about the new Insolvency Regulation.

Under Regulation (EU) 2015/848 of the European Parliament and of the Council, do the courts of a Member State have jurisdiction to open main insolvency proceedings in respect of a citizen whose sole immovable asset is located in that State, while he, along with his family unit, is habitually resident in another Member State where he is in paid employment?

No judgments dealing with issues of private international law are scheduled. Hearings listed until 30 April 2020 are adjourned until a later date.

On 1 April 2020, the UK Supreme Court ruled in Whittington Hospital NHS Trust v XX on the fascinating issue of whether damages for funding foreign surrogacy could be considered as an appropriate remedy in a tort action.

The plaintiff in this case was a woman who lost the ability to bear a child as a consequence of a medical negligence by an hospital which admitted liability.

The dispute was thus concerned with the assessment of the damages that the plaintiff could receive. The calculation obviously depended on how the woman intended to put herself in a position as she would have been if she had not sustained the wrong.

The remarkable claims of the victim

In this respect, the woman made a number of remarkable claims which, it seems, were accepted without debate by the court: (i) as both her and her partner came from large families, she would want to have four children; and (ii) she would want to have those children through surrogacy. It is unclear whether adoption was considered at any point of the proceedings.

I will not comment here on the fact that it seems that the claimant could seek compensation for as many children as she wanted to (the judgment underscores that her sister had 10, so maybe that was the limit). But one wonders whether the choice of the plaintiff for surrogacy was disputed. One alternative remedy would obviously be adoption. In many countries, one would be legal, while the other would not be, but this is not the case in England. Yet, there is a duty to mitigate loss in the English law of torts, and the duty means that while the plaintiff may choose the most expensive remedy to make good her loss, she may not charge it to the defendant (Darbishire v. Warran, 1963). But maybe adoption is actually more expensive than surrogacy.

The debate focused on a third claim: the claimant would prefer to use commercial surrogacy arrangements in California; but if this would not be funded (i.e. through the damages awarded by the court), she would use non-commercial arrangements in the United Kingdom.

The reason why the claimant feared that her preference for commercial surrogacy might well be denied funding was that the Court of Appeal had ruled in Briody v St Helen’s and Knowsley Area Health Authority that commercial surrogacy in California was contrary to public policy. The Court of Appeal had also ruled in Briody that only surrogacy with the claimant’s own eggs would be restorative.

The first instance judge thus ruled that commercial surrogacy would not be funded, and that, given that the claimant could probably have only two children using her eggs, only two non commercial surrogacies in the UK could be funded, for £ 37,000 each.

Judgment of the Supreme Court

The Supreme Court overruled Briody on both accounts. Lady Hale ruled for the majority that awards of damages for foreign commercial surrogacy are no longer contrary to public policy, and that no distinction should be made based on the origin of the eggs.

From the Press Summary of the Court:

UK courts will not enforce a foreign contract if it would be contrary to public policy. But most items in the bill for a surrogacy in California could also be claimed if it occurred here. In addition, damages would be awarded to the claimant, the commissioning parent, and it is not against UK law for such a person to do the acts prohibited by section 2(1) of the 1985 Act. Added to that are developments since Briody: the courts have striven to recognise the relationships created by surrogacy; government policy now supports it; assisted reproduction has become widespread and socially acceptable; and the Law Commissions have proposed a surrogacy pathway which, if accepted, would enable the child to be recognised as the commissioning parents’ child from birth. Awards of damages for foreign commercial surrogacy are therefore no longer contrary to public policy. However, there are important factors limiting the availability and extent of such awards: both the treatment programme and the costs involved must be reasonable; and it must be reasonable for the claimant to seek the foreign commercial arrangements proposed rather than to make arrangements within the UK; this is unlikely to be reasonable unless the foreign country has a well-established system in which the interests of all involved, including the child, are properly safeguarded [49-54].

Lord Carnwath’s dissenting judgment differs from the majority on [this] issue only. In his view, while this case is not concerned with illegality, there is a broader principle of legal coherence, which aims to preserve consistency between civil and criminal law. It would go against that principle for civil courts to award damages based on conduct which, if undertaken in the UK, would offend its criminal law. Society’s approach to surrogacy has developed, but there has been no change in the critical laws on commercial surrogacy which led to the refusal in Briody of damages on that basis. It would not be consistent with legal coherence to allow damages to be awarded on a different basis [55-68].

So, it seems that the claimant was entitled to choose commercial foreign surrogacy over UK non commercial surrogacy.

But then this begs an obvious question: how can you possibly justify that she charges the defendant with her costly preferences? Unfortunately, it will take another case to know, it seems. Lady Hale concluded her judgment by stating:

Third, the costs involved must be reasonable. This too has not been put in issue in this case, which has been argued as a matter of principle, but it should certainly not be taken for granted that a court would always sanction the sorts of sums of money which have been claimed here.

On 21 March 2020 the Fellows of the European Law Institute (ELI) have approved a Report on the Protection of Adults in International Situations.

The Report, prepared by Pietro Franzina and Richard Frimston based on the work of a team of academics and professionals, is the outcome of a project launched in 2017. The purpose of the Report is to illustrate the current legal framework applicable in Europe, in cross-border cases, to the protection of persons aged 18 or more who are not in a position to protect their interests due to an impairment or insufficiency of their personal faculties, and to outline the measures that EU institutions might take to enhance such protection.

The Report encourages further ratifications of the Hague Convention of 13 January 2000 on the International Protection of Adults, and suggests a number of legislative and non-legislative measures that the EU could take to complement the Convention and improve its operation in the relationship between Member States.

Luk De Baere and Frits Blees are the authors of Insurance Aspects of Cross-Border Road Traffic Accidents, published by Eleven International Publishing.

The abstract reads as follows.

Claims handling of cross-border traffic accidents is a complex process. The rules governing the handling and settling of such accidents often requires in-depth knowledge of a wide range of fields of expertise: the applicable law on liability and compensation, insurance law, the law of the European Union, private international law and – last but not least – the functioning of the various Agreements between national organisations of motor insurers such as the Green Card Bureaux, the national Guarantee Funds etc. Insurance Aspects of Cross-Border Road Traffic Accidents provides practitioners in the field with the necessary background information. The book offers a comprehensive analysis of the insurance aspects of cross-border road traffic accidents. This new publication will prove extremely useful for professionals of insurance companies, specialists in claims handling organisations, members of staff within national Green Card Bureaux, Guarantee Funds and Compensation Bodies, but also for solicitors, magistrates and legislators.

Further information available here.

On 2 April 2020, the Hague Academy of International Law announced its decision to postpone the Summer Courses on Public and Private International Law scheduled for July and August 2020, as well the Academy’s Centre for Studies and Research, devoted this year to Applicable Law Issues in International Arbitration.

Both events will take place in 2021.

The Academys’ annoucement reads as follows.

It is with a very heavy heart that, in view of the evolution of the spread of COVID-19, the Academy is forced to cancel its programmes planned for the summer of 2020: the Summer Courses on Public and Private International Law, as well as the Centre for Studies and Research. This is the second time in their almost centenary existence that the Summer Courses will not be able to take place. Only the Second World War was able to stop the running of the courses, the Academy’s main activity;  the one to which it owes its renown.

An exceptional situation, which calls for an exceptional decision: the Academy’s doors will remain closed this summer. The two programmes will be postponed to 2021. The Summer Courses will take place between 5 July and 13 August 2021 and the session of the Centre for Studies and Research between 16 August and 3 September 2021. The updated poster of the 2021 Summer Courses will be available online in April/May.

A video message by Jean-Marc Thouvenin, the Secretary-General of the Academy, may be found here.

Anne Peters (Max Planck Institute for Comparative Public Law and International Law), Sabine Gless (University of Basel), Chris Thomale (Ruprecht-Karls Universität Heidelberg) and Marc-Philippe Weller (Heidelberg University) have posted Business and Human Rights: Making the Legally Binding Instrument Work in Public, Private and Criminal Law on SSRN.

The paper’s starting point is the United Nations Human Rights Council working group’s revised draft of a Legally Binding Instrument to Regulate, in International Human Rights Law, the Activities of Transnational Corporations and other Business Enterprises of July 2019. The paper examines the draft treaty’s potential to activate and operationalize public law, private law, and criminal law for enforcing human rights. It conceptualizes a complementary approach of these three branches of law in which private and criminal legal enforcement mechanisms stand in the foreground. It argues for linking civil (tort) and criminal liability for harm caused by hands-off corporate policies, complemented by the obligation to interpret managerial duties in conformity with the human rights standards of public international law. The combination of public, private, and criminal law allows effective enforcement of human rights vis-à-vis global corporations.

The paper is part of the Max Planck Institute for Comparative Public Law & International Law (MPIL) Research Paper Series.

If you notice something strange on the EAPIL website today, don’t worry. We’re upgrading some of the site functions, which may result in small disruptions. The site as such is up and running. Apologies for any inconvenience!

On 26 March 2020, advocate general Tanchev delivered his Opinion on the JE case (case C-249/19) – the first case to be decided by the CJEU on the Rome III Regulation on the law applicable to divorce and legal separation (Regulation 1259/2010).

At stake is the interpretation of Article 10 of the Regulation, according to which, ‘Where the law applicable pursuant to Article 5 or Article 8 makes no provision for divorce or does not grant one of the spouses equal access to divorce or legal separation on grounds of their sex, the law of the forum shall apply.’

The question for a preliminary ruling, from the Regional Court of Bucharest, revolves around the expression ‘the law applicable pursuant to Article 5 or Article 8 makes no provision for divorce.

The referring court asks whether that should be interpreted

(a) in a strict, literal manner, that it is to say only in respect of a situation where the foreign law applicable makes no provision for any form of divorce, or

(b) more broadly, as also including a situation where the foreign law applicable permits divorce, but does so in extremely limited circumstances, involving an obligatory legal separation procedure prior to divorce, in respect of which the law of the forum contains no equivalent procedural provisions?

THE FACTS OF THE CASE

JE and KF married in Romania, on 2 September 2001. Fifteen years later, JE brought an action for divorce, also in Romania. By civil judgment of 20 February 2018, the national court established the general jurisdiction of the Romanian courts and established that the law applicable to the dispute was Italian law, pursuant to Article 8(a) of Regulation No 1259/2010, since — on the date on which the court was seized of the divorce petition — the parties were habitually resident in Italy (the parties have resided in Italy for a considerable time).

According with Italian law, a divorce petition such as the one brought by JE can be applied for only where there has been a legal separation of the spouses established or ordered by a court and at least three years have passed between the legal separation and the time at which the court was seized of the divorce petition (the statement, in reality, does not accurately describe the Italian legislation on divorce, as reformed: in 2015, a bill was passed which reduced the three-year period to a one-year period, adding that six months suffice in particular circumstances; arguably, however, the change does not affect the substance of the AG’s reasoning).

Since it had not been demonstrated that a court decision had been made to effect a legal separation of the parties and since Romanian law makes no provision for legal separation proceedings, the court ruled that those proceedings had to be conducted before the Italian courts and, accordingly, any application to that effect made before the Romanian courts was inadmissible.

THE PROPOSAL AND ITS REASONING

The Opinion submits that Article 10 of Regulation No 1259/2010 must be interpreted strictly: the expression ‘where the law applicable pursuant to Article 5 or Article 8 makes no provision for divorce’ therein relates only to situations in which the applicable foreign law does not foresee divorce under any form.

AG elaborates his proposal in a classical, orthodox way. First, he examines the wording and the scheme of the provision. The law of the forum only applies ‘where the law applicable pursuant to Article 5 or Article 8 makes no provision for divorce’; the wording ‘makes no provision for divorce’ cannot mean that the applicable law ‘provides for divorce under certain (substantive or procedural) conditions’. AG explains that the provision is a consequence of the universal application of the Union conflict-of-law rules in relation to divorce and legal separation, in accordance with Article 4 of the same regulation. He acknowledges that Article 10 of Regulation No 1259/2010 endorses favor divortii, but with limits. In particular, it does not cover a case where the marriage cannot be ended because certain prerequisites are not met: for instance, where the applicable law sets out restrictive grounds for divorce such as the requirement of a long(er) period of separation.

To back his opinion, AG seeks additional support in systemic arguments, which he derives from Article 13 and Recital 26. Article 13 of Regulation No 1259/2010 provides that nothing in that regulation shall oblige the courts of a participating Member State whose law does not provide for divorce to pronounce a divorce. According to Recital 26, ‘where this Regulation refers to the fact that the law of the participating Member State whose court is seized does not provide for divorce, this should be interpreted to mean that the law of this Member State does not have the institut[ion] of divorce’. AG posits that the Recital gives an explanation beyond the specific context of Article 13 on the interpretation of the expression ‘makes no provision for divorce’- hence, it also applies to Article 10, which employs the same expression.

The historical interpretation supports as well the construction of the provision proposed in the present Opinion. AG recalls that the first alternative contained in Article 10 was introduced above all with a view to Maltese law, which, at the time of drafting of the Regulation, did not provide for the granting of any divorce.

The spirit and purpose of Article 10 speak equally in favor of a strict interpretation. Through the adoption of common rules on conflict-of-laws, the participating Member States accepted the principle that their courts could be obliged to apply foreign law despite differences which this might present vis-à-vis their own national law; they also accepted limited exceptions to that principle. Article 10 is one of them: like all exceptions, it must be interpreted strictly. Moreover, an extensive interpretation would frustrate the spouses’ autonomy in relation to divorce and to legal separation (foreseen under Article 5 of the regulation), and prevent the application (pursuant to Article 8 of the regulation, in the absence of a choice by the parties) of the law which is most closely linked to them.

CONSEQUENCES OF THE ANSWER

In addition to giving advice to the CJEU, AG Tanchev suggests how it could provide guidance on the consequences of the proposed answer to the preliminary question. In this regard, following the Commission, AG proposes that the court seized apply the substantive conditions foreseen by the applicable law and forgo the application of any procedural conditions foreseen by that law, in circumstances –like in the case at hand- where the procedural law of the forum does not allow for those procedural conditions to be met.

No doubt AG’s intention is to be praised. At the same time, and because the problem the Romanian court is facing can be characterized as pertaining to procedure (the Romanian court declared the petition inadmissible, which by the way begs the question, was it applying Romanian law as lex fori , or rather Italian law?), the proposed solution may be seen a little bit in the verge of overstepping the competences of the Court (who could nevertheless include it obiter). In addition, the parallelism AG Tanchev draws with EU regulations where respect for the substance of the applicable law in the State of the forum, when the latter’s law has no equivalent (substantive) concept in law, is reached through adaptation, is questionable.

Finally, still related to this part of the proposal: AG Tanchev indicates that the Romanian court should “confirm in its decision in the divorce proceedings that that condition of legal separation was fulfilled”. Fine, except for the fact that a problem remains regarding divorce: according to Italian law at least three years must have passed between the legal separation and the time at which the court was seized of the divorce petition. How is the Romanian court going to deal with this – for, obviously, no date of separation is available? (Further: it the parties agreed on the three-years period having elapsed, will their assertion be accepted ?)

 

In spite of the open questions and doubts just described, I believe this is an Opinion that will well received. Indeed, concerning the core subject matter it is not a surprising one; it is at any rate is correct in contents and rationale, and a well articulated piece of work. And – not that common in the writings of the CJEU –  one with many references to legal doctrine.

The general course that Catherine Kessedjian (University of Paris II – Panthéon Assas) gave at the Hague Academy of International Law in January 2019 on Neutrals in International Law – Judges, Arbitrators, Mediators, Conciliators (Le tiers impartial et indépendant en droit international, juge, arbitre, médiateur, conciliateur) has been published in the Collected courses of the Academy.

The course is written in French, but the author has provided the following English abstract:

At a time when the role of adjudicators and neutrals is criticized in domestic as well as international law, it seemed a good idea to explore the characteristics of the women and men who participate in the act of justice, and their methods of working, either as judges, arbitrators, mediators or conciliators.

The goal of the lectures was to call the students’ attention to the fact that judicial decisions are not the only way neutrals speak to the larger public and us, legal specialists. There are many other ways that are pertinent for exploration in order to better understand how justice is rendered in international law.

International law is to be understood in the broad sense as covering both public international law and private international law. Indeed the lectures were given as the general course of the inaugural winter session of the Academy entitled “international law” and conceived as a departure from the classic dichotomy still pertinent for the summer session.

The lectures, therefore, endeavor to explore the common characteristics of all neutrals and those that may be more specifics for any of the sub categories.

Among all the topics that could have been chosen to reach the goal we had set for ourselves, only a few were indeed included in the lecture i.e. : theory of law; history; the special role of mediators and of domestic judges; architecture; allegories of justice; the personality of neutrals; impartiality; jurisdiction; cooperation and more.

Finally, it is to be noted that these are the first Hague lectures reproducing images to help the discussion. In a world where images are omnipresent, we are convinced that they contribute to a better understanding of the topics and facilitate memory to concentrate on some of the more potent messages these lectures want to convey. Several testimony of that method have been reported in the lectures themselves.

Caricature created by A. Senegacnik for Ch. 14 of C. Kessedjian’s Lectures,
Reproduced with the kind permission of the artist

The full table of contents of the Lectures can be found here.

Courts in the EU increasingly issue injunctions against anti-suit injunctions, or “anti-anti-suit injunctions”. We have already read in this blog about the French practice. The Germans are doing it as well.

Facts

One example is a decision by the Court of Appeal in Munich dated 12 December 2019 (English translation here). As in the French proceedings, at issue was a claim for patent violation. And again, the defendant raised a counter-claim for fair, reasonable and non-discriminatory (FRAND) licensing in the US and applied for an anti-suit injunction against the proceedings in Europe. 

Perhaps less usual is that the defendant resorting to this tactic was a behemoth of the German industry, the company Continental, which produces everything from tyres to electronic systems for car manufacturers. Continental had been sued in Germany by Finnish company Nokia for an alleged patent violation. Continental in turn sued Nokia in the US for FRAND licensing and applied for an anti-suit injunction there to stop the German proceedings.

The reason behind this behaviour apparently is that the US courts interpret the conditions for FRAND licensing more favourably for the licensee than their European counterparts. Defendants in patent licensing disputes therefore try to shift the battlefield to the other side of the Atlantic. Even German companies now prefer Californian over Bavarian courts, and companies called “Continental” switch to different continents.

Decision

Continental’s tactic drew the ire of the Landgericht Munich I, a tribunal of first instance. It issued an injunction against the German company, enjoining it from any anti-suit application in the US against the proceedings in Germany (English translation here). The Court of Appeal (Oberlandesgericht) in Munich affirmed.

The legal rule on which Nokia’s lawyers based their claim was quite peculiar. They resorted to nothing less than the authorisation of self-defense under the German Civil Code (sec. 227 BGB). One is accustomed to the usage of this provision in cases about pub brawls or domestic violence, but less in intellectual property rights disputes between multinational companies.

The Munich Court of Appeal felt somehow uneasy with this legal basis. They stayed in more familiar terrain by weighing the interests of the parties. The court stressed Nokia’s right to pursue its patent in court (sec. 1004 BGB applied by analogy), which would be constitutionally protected and impeded by the pending US anti-suit injunction. The defendant, on the other hand, could be expected to raise the FRAND issue in the German proceedings. Hence the decision to issue the anti-anti-suit injunction.

Group of companies – A minor complication

One peculiarity of the case is that the defendant in the German proceedings, the parent company Continental AG, was not identical to the party of the counter-proceedings in the US. Instead, these had been started had been another company of the Continental group. The court had however little problems in attributing the behaviour of the subsidiary to the parent of the same “Konzern” or group of companies.

Public international law – A major problem

What is more surprising is that the Munich court had no qualms to consider its injunction as being entirely in line with customary public international law. In the past decades, European courts, especially in Germany, have complained about the extraterritorial overreach by US courts and the violation of sovereignty through anti-suit injunction. Now they are doing the same.

The tribunal of first instance had come up with an interesting justification. In its opinion, anti-suit injunctions could not be illegal under customary public international law because the Anglo-Saxon courts had issued them for years. In other words, bad practice creates bad customary law.

The Munich Court of Appeal found an even easier excuse. It simply stated that the extraterritorial effects would be a mere reflex of the anti-anti-suit injunction and not impair the sovereignty of the US. More worryingly still, it also opined that the legality under public international law hardly mattered since the injunction was in line with the German constitution. Constitutionality trumps legality under international law – a strange and dangerous concept.

Assessment 

Anti-anti-suit injunctions are a remarkable shift from the traditional European aversion against extraterritoriality and the interference with judicial proceedings abroad. Courts in Germany and in France seem to have lost both their naivety and their innocence. They now use the same weapons as their Anglo-Saxon counterparts.

The development can be summarised in terms of the Old Testament: “An eye for an eye”. As the experience of claw-back-litigation has taught, the winning country will be the one where most assets are located. German companies will thus probably never again apply for anti-suit injunctions against proceedings in Germany.

The aim of the European courts to defend their jurisdiction is certainly understandable. Yet the mutual exchange of anti-suit injunctions across the Atlantic also has costs. What stops a US court from issuing an “anti-anti-anti-suit injunction”? In the end, civil justice becomes a power play. It is long ago that public international law incarnated the polite rules of diplomacy. We seem to be back to the state of nature.

The author of this post is María Barral Martínez, trainee at the Court of Justice of the European Union.

On 26 March 2020, Advocate General Campos Sánchez-Bordona issued his Opinion in C-80/19, E.E. (the text of the Opinion was not available in English at the time of publishing this post).

At first glance, the case is reminiscent of case C-658/17, WB, where a request for a preliminary ruling from Poland sought clarification on the concept of “court” within the meaning of article 3(2) of the Regulation 650/2012 (“European Succession Regulation”), and which also dealt with the nature of the certificates of succession rights at national level. To a lesser extent, the case follows up on the question of competence of national authorities to issue certificates of succession, addressed by the Court in C-20/17, Oberle.

However, in E.E., the Court is faced with several questions that go a step further.

First, the referring court asks whether Lithuanian notaries meet the definition of “court” under article 3(2) of the Regulation.

Second, should this not be the case, whether Lithuanian notaries, without having to apply general rules of jurisdiction, can issue national certificates of succession and if these are deemed to be authentic instruments which have legal effects in other Member states.

Moreover, the referring court inquires, considering the present case’s factual circumstances, if the succession at stake qualifies as a succession with cross-border implications and, therefore, whether the European Succession Regulation should apply.

In addition, the referring court asks whether it could be inferred from the Regulation that the habitual residence of the deceased can only be one. Finally, certain questions were posed relating to the choice of Lithuanian law and on the choice-of-court agreement by the parties concerned.

The case

The Appellant’s mother, a Lithuanian national married to German national, moved to Germany with her son (E.E., “the Appellant”). In one of her visits to Lithuania, she had her will made by a notary located in Kaunas, designating her son as sole heir of her entire estate, which consisted of an apartment in Kaunas. After the Appellant’s mother died, he contacted the notary office in Kaunas to initiate the succession procedure, asking for a certificate of succession rights.

The notary refused to issue the certificate. She argued that, according to the European Succession Regulation, the last habitual residence of the deceased mother was in Germany. The Appellant challenged the notary’s decision before the Kaunas District Court (“District Court”), which quashed the decision of refusal and ordered the notary to open the succession procedure, and to issue a certificate of succession rights. The District Court stated that even though the Appellant’s mother had moved to Germany, she was a Lithuanian national and, on the day of her death, she owned immovable property in Lithuania. Further, she had not severed her links with that country, had kept visiting it, and set up her last will there.

The notary appealed the first instance court decision. The Kaunas Regional Court (“Regional Court”) ruled in her favour putting forward that whenever the habitual place of residence of the deceased is disputed, only a court can establish the legal fact leading to the recognition of the habitual place of residence of the deceased in her country of origin. In the present case nothing indicated that the court of first instance had addressed that issue; in deciding against the notary’s decision it had rather – and unreasonably- relied upon general principles.

E.E. lodged a cassation appeal before the Supreme Court of Lithuania, who submitted the request for preliminary ruling. Case C-658/17, WB, was pending at the time, but decided before the attribution of C-80/19 to AG Campos.

Application of the Regulation, the concept of cross-border implications and last habitual residence of the deceased

AG Campos Sánchez-Bordona starts his analysis addressing the applicability of the Regulation. In his view (in disagreement with the arguments of the referring court, in fear that applying the Regulation to the case at hand would make it harder for the sole heir to claim his rights), when a given succession presents cross-border implications, the application of the Regulation is compulsory (point 36). He highlights that the Regulation itself may provide for means to mitigate the effect of the cross-border character of a succession. Notably, under Article 22 thereof, a person may choose her national law as the law governing his succession, following which the parties concerned will be allowed to opt for a choice-of-court agreement giving the courts of the member state of the nationality of the deceased exclusive jurisdiction to rule on the succession as a whole.

The Regulation does not provide for a definition of “succession having cross-border implications”. It nevertheless portrays different examples of succession having cross-borders implications. In the light of them, AG indicates that some key elements could be the location of the estate, the heirs and legatees or the nationality of the deceased.

Further, AG looks into whether it is possible to establish the last habitual residence of a deceased in more than one state and on how could it be determined. He notes that allowing for the location of the habitual residence in more than one Member State would thwart the aim of the provisions under the Regulation (point 44). In accordance with the principle of unity of succession, legal certainty and the aim to avoid contradictory results, article 4 of the Regulation should be understood as meaning that the last habitual residence of the deceased can only be located in one Member state.

Moreover, he emphasises that the concept of habitual residence is an autonomous notion of EU Law to be primarily interpreted in the light of the objectives of the Regulation itself (point 46). The habitual residence of the deceased should reveal a close and stable connection with the Member State concerned. To determine the exact location of the habitual residence, it is necessary to carry out an overall assessment of the life of the deceased during the years preceding his death. Such assessment should be done in a case by case approach. The authority dealing with the succession should consider all evidence that would help to determine the habitual residence. For that purpose, AG points out that  the Regulation itself provides some guidance. Recitals 23 and 24 envisage two different scenarios: The first one, where factual information, especially in relation to the duration and regularity of the testator presence in a State, already reveals a close and stable connection with the state concerned. The second one features a situation where the deceased was not, on a permanent basis, in a single State. In the latter, a personal element (the nationality of the deceased) or economic factors (where the main assets of the estate are located) should weight more in the overall assessment of the circumstances relating to the life of the deceased.

In contrast, as AG puts it, mere statements of the persons with an interest in the succession are not pertinent for the ascertainment of the habitual residence of the deceased (point 50).

Lithuanian notaries and national succession certificates

Next, the Opinion deals with the question of whether Lithuanian notaries are “courts” within the meaning of article 3(2) of the Regulation. AG, based on the information provided by the referring court and the Lithuanian government during the hearing, concludes that, when issuing a national certificate of succession rights, Lithuanian notaries are not vested with the power to hear and determine disputes in matters of succession. Hence, they cannot settle contentious issues between the parties (point 81). Neither can they interpret any doubts arising from the provisions of the will, rule on its validity or execution. For that, a judicial authority is required. Therefore, following the Court’s line in WB, Lithuanian notaries do not meet the definition of “court” under article 3(2) of the Regulation. Therefore, they are not subject to the rules of jurisdiction in that instrument (points 83 and 84).

AG observes that, subject to the referring court verification, Lithuanian national succession certificates, issued by a notary at the request of one of the parties, in accordance with an official model, and following verification of the facts and statements listed therein, qualify as authentic instruments under of article 3(1)(i) of the Regulation. Hence, they shall produce evidentiary legal effects in other Member States (point 88).

Applicable law and Choice-of-court agreement

The Opinion turns then to the question whether the parties accepted the jurisdiction of the Lithuanian courts and whether Lithuanian law applies.

As AG highlights, only the deceased can choose the applicable law; the choice is limited to his/her national law according to article 22(1) of the Regulation. Moreover, it is subject to certain formal requirements laid down under article 22(2) thereof. A choice of law by the deceased which has not been explicitly made in a declaration in the form of a disposition of property must result exclusively from the terms of such a disposition. Elements such as the travel of the testator to Lithuania to grant her will before a notary, the nationality of the latter or the legal system bestowing him with the competence to draft the will, are only supportive -but not decisive- factors. Precisely because a notary was called to intervene at a time when the Regulation had already entered into force, it could be expected that the testator got legal advice as to the applicable law.

In the case at hand, the will of the deceased was drawn up before 17 August 2015. As she passed away after this date, the application of the transitional provisions under article 83 of the Regulation was called for. Article 83(4) thereof establishes a legal fiction by which “if a disposition of property was made prior to 17 August 2015 in accordance with the law which the deceased could have chosen in accordance with this Regulation, that law shall be deemed to have been chosen as the law applicable to the succession”. Under these circumstances, as AG indicates, there is no further need to ascertain if a valid choice of law was made by the testator under Article 83 (2) of the Regulation.

With reference to the choice-of-court agreement, AG remarks that Article 5 would allow for such an agreement only under the condition of a choice of law by the testator. In the present case the question arises whether the parties concerned would still have that option, since the national law of the testator had not been chosen but is imposed as a result of the legal fiction designed under Article 83(4). In point 113, AG indicates that the answer must be yes, ruling out a formalistic reading of the Regulation. Jurisdiction is thus granted to the authority most familiar with the applicable substantive law, in consistency with the objective set out in Recital 27 of the Regulation.

Finally, AG understands that there has been no agreement between the parties concerning the exclusive jurisdiction of Lithuanian courts to rule on the succession. Only unilateral statements and actions were made by the Appellant and the spouse of the deceased in favor of having all succession matters settled in Lithuania  In particular, the spouse consented to the jurisdiction of Lithuanian courts while expressing that he would not be a party to any proceedings. Against this background, AG concludes that article 7(c) should be read as meaning that a statement made outside the proceedings by a party concerned with the succession, by which she accepts the jurisdiction of the courts in respect of proceedings initiated by other party, amounts to an express acceptance of the jurisdiction of those courts, provided it satisfies the formal conditions required by the procedural rules of the forum (Point 123 (7)).

On 26 July 2019, the Greek Supreme Court gave a ruling involving the interpretation of the Brussels II bis Regulation in a matter of parental responsibility (Ruling No 927 of 2019).

The facts

A. and B., of Greek and German nationality, respectively, an unmarried couple, had two children. They all lived in Greece.

The mother, B., seised the Court of First Instance of Rhodes seeking the exclusive custody of the children as well as an interim measure to the same effect. In the resulting summary proceedings, A., the father, declared that he would not object, as long as the court ordered that the children keep their habitual residence in Rhodes. B. stated that she did not intend to relocate the children.

The Court provisionally granted exclusive custody to B., without issuing any order regarding the habitual residence of the children. A hearing on the merits was scheduled to take place a few months later.

Shortly after the above prrovisional order was issued, B. informed A. that she planned to spend Christmas with the children at her parents’ house in Germany.

A. formally notified B. that he disagreed. Nevertheless, B. travelled to Germany with the children. Although she had bought return tickets, she eventually decided to stay in Germany with the children.

As a reaction, A. sought the revocation of the provisional measures on custody, as well as the return of the children to Greece and an order granting him exclusive custody rights. A.’s efforts were initially successful. The provisional measures were revoked, and custody was provisionally granted to him.

B., however, challenged the jurisdiction of the Greek courts over A.’s action for custody.

The Rhodes Court of First Instance considered the challenge to be founded and accordingly declined jurisdiction. A.’s appeal against this decision was dismissed by the Dodecanese Court of Appeal.

The Supreme Court’s ruling

The case reached the Supreme Court. The latter began by considering Article 8 of the Brussels II bis Regulation, whereby, as a general rule, jurisdiction over matters of parental responsibility lies with the courts of the Member State where the child habitually resides. The Supreme Court held that relocation while proceedings are pending does not affect the jurisdiction of the court seised.

The Supreme Court agreed with the Court of Appeal that the practical difficulties that relocation may entail in particular for the parent not exercising custody rights have no bearing as such on the issue of jurisdiction, which depends solely on the habitual residence of the children at the time the court is seised. Thus, once the habitual residence of a child has been transferred from one Member State to another, the courts of the latter State come to have jurisdiction, unless the transfer amounts to a wrongful removal or retention, as defined in Article 2(11) of the Regulation.

Based on the foregoing, the Supreme Court confirmed the ruling of the Court of Appeal. Specifically, it held that when A. filed his action (in February 2015), the children were already habitually resident in Germany. Actually, the names of the children had been entered in the register of the population of the town of Kevelaer in February 2014; they benefited from a health insurance there since April 2014; they attended a kindergarten there; they had developed strong relations with B.’s relatives living nearby. The Court also noted that the children, who were also German nationals, spoke German, whereas they barely spoke any Greek.

The Supreme Court held that no wrongful removal had taken place in the circumstances, stressing that, at the time when the transfer took place, B. had temporary exclusive custody rights. Against this backdrop, relocation was lawful, and A. should have rather pursued a re-arrangement of his contact rights with the children.

The statement made by B. in the course of the summary proceedings that she did not intend to relocate the children was not considered to be decisive. Given that B. had exclusive custody rights over children, she was entitled, pursuant to Article 2(9) of the Regulation, to determine the children’s place of residence.

With respect to Article 10, on jurisdiction in case of child abduction, the Supreme Court found that no wrongful retention had taken place after the revocation of the provisional measure, which granted A. exclusive custody rights. The Court noted that A. had not sought to have the new provisional measures recognised and enforced in Germany, and held that A.’s assertion that the latter measures are enforceable without any procedure being required is erroneous. The revocation of a provisional measure, the Court held, is not a judgment for the purposes of Article 11(8) of the Brussels II bis Regulation. Actually, at that time, the children had already an established place of residence in Germany.

The final line of defence for A. was Article 12(3) of the Brussels II bis Regulation. This provides that the courts of a Member State have jurisdiction over parental responsibility in proceedings unrelated to a matrimonial matter where: (a) the child has a substantial connection with that Member State, namely by virtue of the fact that one of the holders of parental responsibility is habitually resident in that Member State, (b) their jurisdiction ‘has been accepted expressly or otherwise in an unequivocal manner by all the parties to the proceedings at the time the court is seised and is in the best interests of the child’.

In particular, A. argued that B. had implicitly accepted the jurisdiction of Greek courts by initially filing an action before the Court of First Instance of Rhodes.

The Supreme Court dismissed the argument. First, it stated that, by filing her initial petition, B. could not be deemed to have tacitly accepted the jurisdiction of Greek courts for any ensuing proceedings. Secondly, the Court noted that the initial action had been brought prior to the relocation of B. and the children in Germany, adding that B. had then asked for her action in Greece to be discontinued. Finally, the Court observed that no tacit acceptance could be deemed to exist, since B. expressly challenged the jurisdiction of Greek courts as a result of A.’s action.

On 3 March 2020, the international chamber of the Paris Court of Appeal confirmed that French courts may issue an anti anti suit injunction against two US corporations which had obtained an anti suit injunction from a US court in a patent case.

When the Paris court of appeal delivered its judgment, the French anti anti suit injunction had already proven successful, as the motion for the anti suit injunction filed before the US court had been withdrawn in the meantime. The French higher court nevertheless addressed the issue and confirmed that the Paris first instance court had the power to grant the remedy.

Background

The dispute arose between, on the one hand, various companies of the Lenovo and Motorola groups and, on the other hand IPCom, a German company.  IPCom claims it owns various patents that Lenovo and Motorola use for manufacturing their devices. Lenovo and Motorola claim that IPCom did not offer them a license on appropriate terms and conditions (fair, reasonable and non discriminatory, or FRAND), and in particular that IPCom royalty demands violate these terms.

Initial Proceedings in California

In March 2019, Lenovo Inc. (‘Lenovo US’) and Motorola Mobility LLC (‘Motorola US’) sued IPCom before a US District in San Jose, California, for breach of contract, declaratory judgment, antitrust monopolization and declaratory judgment of non violation of certain U.S. patents. The suit was predicated on the allegation that IPCom failed to offer Lenovo and Motorola a license to its alleged standards essential patents (SEPs) relevant to the 2G, 3G and 4G cellular standards on FRAND terms and conditions.

IPCom challenged the jurisdiction of the U.S. court. It explained that it is a small company, employing six people only in Germany, and it argued that its contacts with the USA were not significant enough to justify the jurisdiction of a U.S. court under the Due Process jurisprudence of the U.S. Supreme Court.

In December 2019, the U.S. court accepted that the plaintiffs had failed to make a prima facie showing of personal jurisdiction over IPCom and thus limited discovery to the issue of personal jurisdiction.

Subsequent Proceedings in England

IPCom counterattacked in England, where it initiated proceedings against Lenovo UK and Motorola UK in July 2019. I understand that IPCom claims revolve around the allegation that it owns certain patents, and that these patents were infringed by the two UK defendants.

In September 2019, Lenovo US and Motorola US sought an anti suit injunction from the US court against IPCom and requested that the California court :

(1) enjoin IPCom from prosecuting the patent infringement action IPCom filed in the United Kingdom against Plaintiffs’ U.K. affiliates; and

(2) enjoin IPCom from instituting against Plaintiffs, Plaintiffs’ affiliates, or any of their customers any action alleging infringement of IPCom’s claimed 2G, 3G and/or 4G SEPs during the pendency of this action.

In November 2019, the London High Court issued an anti anti suit injunction against Lenovo UK and Motorola UK enjoining them from preventing the continuation of the English proceedings.

The French Injunctions

In October 2019, IPCom had also initiated proceedings in Paris, but this time against the Lenovo and Motorola US and French entities.

IPCom first initiated interim proceedings and sought injunctions against all the defendants. In November 2019, IPCom also initiated proceedings on the merits against the French subsidiaries only.

On November 8th, 2019, the Paris first instance court issued two anti anti suit injunctions.

The first was concerned with the existing US application. The French court ordered Lenovo US and Motorola US to withdraw their motion for an anti suit injunction in the California proceedings, insofar as such motion related to any judicial proceedings initiated by IPCom and alleging infringements of the French part of the European patent owned by IPCom, materialising by acts on French territory.

The second was a prospective anti anti suit injunction, whereby the court enjoined Lenovo US and Motorola US from initiating any such new proceedings (i.e. seeking an anti suit injunction), before any foreign court.

Both injunctions were to be sanctioned by a civil penalty (astreinte) of € 200 000 per day of non compliance (first injunction) or per instance of violation (second injunction).

Lenovo US and Motorola US moved to give notice of partial withdrawal of their motion in the U.S., in accordance with the French injunctions.

By a judgment of 3 March 2020, the Paris Court of Appeal confirmed the power to issue the first injunction. It held, however, that the second injunction was too broad (no limitation of either its temporal or territorial scope), and did not meet the requirements for issuing interim remedies, as the goal was neither to stop actual harm, nor to prevent imminent harm.

The judgment focused on whether the general requirements for granting interim relief were met. French courts have general power under the Code of civil procedure (Article 835) to issue interim measures for the purpose of stopping manifestly illegal harm. The court found that the harm was to be enjoined by the U.S. court from initiating proceedings alleging infringement of the patent in France, and that the harm was manifestly illegal, because it violated the exclusive jurisdiction of French courts and two fundamental rights of IPCom: its right to (intellectual) property and its right to a fair trial.

The Power of French Courts to Issue Anti Anti Suit Injunctions

French courts were long hostile to anti suit injunctions. In 2004, the French supreme court for private and criminal matters (Cour de cassation) had ruled in an obiter dictum that anti suit injunctions violate French public policy as the affect the jurisdiction of French courts. However, in 2009, the Cour de cassation qualified this ruling, by holding that foreign anti suit injunctions would not violate French public policy where their aim was solely to sanction a pre-existing contractual obligation, i.e. a jurisdiction clause (in favour of a foreign court).

After the 2009 decision, they were some attempts to go one step further and seek anti-suit injunctions from French courts. As far as I know, they all failed (see, e.g., the Vivendi case in 2010).

In Lenovo, the issue was obviously different, as the parties sought a remedy against anti suit injunctions. While the court’s decision is quite remarkable, the judgment did not attempt to lay down general principles. It is a narrow decision, focused on the general requirements for granting interim measures.

Yet, two series of reasons should be more specifically underlined.

First, the court insisted that French courts had exclusive jurisdiction to rule on the infringements to a French patent (here, the French part of a European patent). This suggests that it would be more difficult to obtain a similar remedy in a contractual or tort case, where no court could seriously claim exclusive jurisdiction (except in presence of a jurisdiction clause).

Secondly, the court ruled that the U.S. anti suit injunction would violate several fundamental rights of the German plaintiff. The first was the right to property under Protocol 1 of the European Convention of Human Rights.  The second was the right to a fair trial under Article 6 ECHR, and more precisely, it seems, the right of access to court. The court explained that, because the patent of the plaintiff was to expire shortly, the anti suit injunction would, in effect, deprive IPCom from its IP right. The court added that the plaintiff could not be protected in the meantime by the U.S. court, since the French court had exclusive jurisdiction. This last proposition is not fully convincing. It is not because French courts consider their jurisdiction as exclusive that a U.S. court would necessarily decline jurisdiction.

Ultimately, Lenovo was probably a good case for issuing such an injunction. The  jurisdiction of the French court was strong, while there were already signs that the foreign court might decline jurisdiction.

Christoph Schmon is the author of The Interconnection of the EU Regulations Brussels I Recast and Rome I – Jurisdiction and Law, published by Springer.

The publisher’s blurb reads as follows.

This book deals with the interconnection between the Brussels I Recast and Rome I Regulations and addresses the question of uniform interpretation. A consistent understanding of scope and provisions is suggested by the preamble of the Rome I Regulation. Without doubt, it is fair to presume that the same terms bear the same meaning throughout the Regulations. The author takes a closer look at the Regulations’ systems, guiding principles, and their balance of flexibility and legal certainty. He starts from the premise that such analysis should prove particularly rewarding as both legal acts have their specific DNA: The Brussels I Recast Regulation has a procedural focus when it governs the allocation of jurisdiction and the free circulation of judgments. The multilateral rules under the Rome I Regulation, by contrast, are animated by conflict of laws methods and focus on the delimitation of legal systems.

See here for further information.

On 27 February 2020 the Court of Justice of the European Union (CJEU) gave its ruling in BALTA, a case concerning the enforceability of choice-of-court clauses in insurance contracts (an English translation of the judgment was not available at the time of publishing this post).

The Court had addressed a similar issue in 2005, in the case of Société financière et industrielle du Peloux. It held then that a jurisdiction clause in an insurance contract cannot be relied upon against an insured who has not expressly subscribed to that clause and is domiciled in a State other than that of the policy-holder and the insurer.

BALTA concerned an insurance contract covering ‘large risks’ within the meaning of the Solvency II Directive. In principle, the provisions in the Brussels I bis Regulation aimed to protect the weaker party, including the provisions that restrict the enforceability of choice-of-court agreements, do not apply to such disputes as relate to those contracts (see Article 15(5) and Article 16(5) of the Regulation).

The Court of Justice ruled that this leeway shall not be permitted where the insured is not the policyholder and is not a qualified professional in the insurance sector.

Facts

The case concerned a dispute between a Latvian insurance company and a Lithuanian security company. The latter had sued the insurance company in Lithuania for compensation under a ‘large risks’ insurance contract that the defendant had concluded with a Latvian company holding the shares of the security company. The insurance company challenged the jurisdiction of the seised court on the basis of a clause in the insurance contract which conferred jurisdiction on the courts of Latvia.

As regards matters of insurance, the Brussels I bis Regulation provides for a special exception for disputes concerning contracts covering ‘large risks’. It is assumed that the parties to a ‘large risks’ insurance contract have significant and equivalent economic power and do not need the protection that is normally afforded by the Regulation to the weaker parties, including the insured. Prorogation of jurisdiction agreed upon by the parties to settle disputes is, accordingly, then fully allowed. However, in the present case, the insured was not the policyholder and had not expressly subscribed to the clause (which the Court reworded as not having agreed with the clause: see para. 25).

The Issue at stake and the Court’s answer

The Lithuanian court asked the Court whether, in the described circumstances, the insured is entitled to claim the protection provided for under the Brussels I bis Regulation. The Court answered in the affirmative, on the ground that the insured was not a qualified insurance professional. Accordingly, the choice of court was not enforceable against him.

The court’s Reasoning

The Court elaborated in its reasoning on the specific protection granted to insured parties, beside that of policyholders, under the Brussels I bis Regulation, especially pursuant to Article 11(1)(b). The Court observed that derogation for ‘large risks’ insurance contracts should be limited to policyholders, when the insured has not expressly subscribed to the clause. Although the latter statement had already emerged in the Court’s case law (notably in Société financière et industrielle du Peloux), the exact scope of the ‘large risks’ derogation remained uncertain. How should the significance of a third party insured bargaining power be evaluated? The question is critical as it is on that single basis that Article 16(5) of Brussels I bis Regulation may be set aside.

According to the Court, the ‘large risks’ derogation only apply to contracting parties and shall not be extended, in principle, to any insured third party (para. 41 of the judgment). While refusing a case-by-case analysis, the Court stated that the protective provisions in matters relating to insurance should be restricted to parties in need of protection. This would not be the case, in particular, of professionals in the insurance sector.

It is however not clear what other situations could be relevant. According to the Court, the security company may benefit from the protective provisions of the Brussels I bis Regulation in matters relating to insurance. Surprisingly, the Court does not take into consideration the legal relationship between the policyholder (i.e., the mother company in the case at issue) and the insured (i.e., its subsidiary) to assess the applicability of the ‘large risks’ derogation. This will not be without operational implications for European undertakings with activities in multiple markets.