UPC_CFI_162/2024, – Hurom v NUC

Expert Commentary

Applicable law Background 1. Hurom alleges infringement in certain UPC countries (where the patent had been validated) and in Turkey, Poland, Spain, and the UK. 2. The Court separated the case for Poland, Spain, and the UK because, at the time of the hearing, the result of BSH Hausgeräte was not known (see separate order reported this week). Decision 1. The Court holds that there is no proof of infringement by the defendants (a Korean company) in Turkey. 2. Art. 71(b)(3) Brussels Regulation (recast) (“BR”) does not provide jurisdiction, as there is no sufficient connection with a UPC member state. 3. A defendant may raise lack of jurisdiction in their (first) defence brief instead of by way of a preliminary objection. Even if the wrong arguments are used, the Court should still consider the jurisdiction question. 4. The UPC can deal with infringements that occurred before the UPC's entry into force (see Art. 3(c) UPCA). 5. The Local Division Mannheim is competent because the infringements take place in Germany. 6. A request for an injunction can be general and does not have to be limited to the infringing product. 7. The transfer of the patent is valid (so the defendant’s argument that the claimant was not the owner of the patent fails). 8. The Court formulates the problems the patent solves and interprets the meaning of certain claim features in light of those solutions. 9. The law applicable to infringing acts after 1 June 2023 is Art. 25 to 28 UPCA. 10. Acts before the UPC's entry into force will be judged according to national law, as retroactive effect without a specific provision is contrary to the Vienna Convention on the Law of Treaties. 11. For alleged infringements that started before and continued after 1 June 2023, UPC law should apply unless this causes hardship for the defendant or claimant. However, it is up to them to provide evidence of national law being more favourable. 12. Art. 26 UPCA includes acts that make infringement possible and support it. 13. Defendant hands over infringing goods to its distributors in Europe from Korea. This also constitutes (indirect) infringement. Comment 1. This is the case against the Korean company. The Court decided on the same day the separate case against the German and French companies selling the same alleged infringing products. Art. 71b(3) BR 2. The question of whether or not this is an infringement in Turkey is, in my opinion, a factual question that should, in principle, be answered only after determining whether or not the Court has jurisdiction (with the exception of cases where jurisdiction is based on Art. 7(2) BR, which—see CJEU Shevill—does not have extraterritorial effect and is not applicable to Turkey). 3. Art. 71b(3) BR remains a bit of a dark horse. However, I think interpreting "damage arising outside the Union" to mean only damage suffered outside the Union as a consequence of infringement in the Union does not make much sense. 4. The wording “from such an infringement” should, in my opinion, not be read as referring to infringement in the Union but more generally to any infringement of the European Patent. If damages outside the Union result from an infringement within the Union, it should, of course, be possible to claim those damages within the Union (before the Court that has jurisdiction over the infringement in the Union). If one interprets Art. 71b(3) BR as only referring to damages resulting outside the UPC as a consequence of infringement in the UPC, Art. 71b(3) BR would be de facto meaningless. 5. In the case at hand, the Court avoids the issue by stating that the dispute does not have a "sufficient connection with any such member state" (where property belonging to the defendant is located). Here again, I am somewhat at a loss as to what exactly is meant by this condition. However, in this case, I see that the defendant has property in Germany (because, from the decision of the same day, I see that there is an NUC GmbH, and I assume that the shares are held by the Korean parent, which is the defendant in this case). Moreover, this defendant is also accused of infringement in Turkey. Is that not a sufficient connection? Ultimately, the Court of Justice will need to clarify this article, but at the very least (in my opinion), it should have a certain practical meaning (I hope) for the holder of a European patent! R. 19 RoP 6. The Court stirs up discussion regarding R. 19 RoP, stating that with respect to (international) jurisdiction, a party can also dispute jurisdiction in their defence brief instead of through a preliminary objection. This is, of course, impractical because it delays a decision on jurisdiction. As a result, costly proceedings may continue only for the case to be dismissed on jurisdictional grounds, making all prior efforts futile! However, here too, the ECJ may have the final word. Applicable Law 7. The Court engages in a discussion of academic length about applicable law. I probably attended a somewhat less academic university, but I was taught that if no specific transitory provisions exist, the new law applies immediately and has no retroactive effect. That was tough luck for the companies who were parallel importing from outside the EU when the EU introduced EU-wide exhaustion in trademark law. (I remember an exception to the principle that a law applies immediately in criminal law: If someone committed a crime under the old law and was judged under the new law, they would be entitled to the less severe penalty if the old law had a lower maximum sentence.) 8. So, while the Court's reasoning is interesting, it is not surprising—except perhaps for its discussion of "continuing infringement." The Court itself acknowledges that "continuing infringement" does not really exist, except possibly in the case of a patented method that is continuously applied—but even in such cases, machines are stopped periodically for maintenance. Should such a distinction (exception) be made and lead to retroactive effect of the UPCA? 9. The Court highlights the difficulty of knowing all national laws. In that respect, I believe national law should be presumed identical to UPCA law, unless the defendant proves otherwise. Competence of the Local Division 10. The Court states that the Local Division in Mannheim is competent as the infringement takes place in Germany. That is correct. See Art. 71b(2) in conjunction with Art. 7(2) BR, especially as there are no territorial limitations in Germany with respect to the competence of the German Local Divisions under Art. 33.1(a) UPCA dealing with the internal competence of the Division. 11. However, I disagree that such competence is limited to Germany. For the UPC, there is only one Court, the Court of First Instance. If the infringement takes place within the territory of that Court, then, under Art. 7(2) BR, that Court is competent for the whole territory where the EP has been validated. The fact that the Court has different Local Divisions and that the internal rules designate a Local Division based on the country of infringement does not alter the fact that the Court as a whole (and thus that Local Division) remains competent under Art. 7(2) BR for the entire UPC. Art. 26 UPCA 12. The Court states that Art. 26 UPC encompasses acts which make the infringement possible and support it. This is not what Art. 26 UPCA explicitly states (which, incidentally, almost all EP States have incorporated into their national patent acts due to the Community Patent Convention, which never entered into force but required harmonization). 13. Most countries would treat such acts (which are not explicitly covered by Art. 26) as torts or unlawful acts. However, in my opinion, such a broad interpretation in the spirit of Art. 26 is commendable, as it ensures that such acts are covered in a harmonized way under the UPC. Infringement 14. The Court considers the handover of products in Korea by the Korean defendant to its UPC distributors as (indirect) infringement in the UPC. The Dutch Supreme Court has ruled that direct infringement occurs in such cases if the Korean company arranges the transport to the UPC—even if the UPC distributors pay for the transport. This, in my opinion, is a practical view, as that act (arranging for the transportation of the goods) constitutes "placing the product on the market.".

Full Decision Text

1 Local Division Mannheim UPC_CFI_162/2024 Procedural Order of the Court of First Instance of the Unified Patent Court issued on 11/03/2025 concerning EP 2 028 981 CLAIMANT Hurom Co., Ltd. - 80-60, Golden root-ro - 62184 - Juchon-myeon, Gimhae-si, Gyeongsangnam-do - KR Represented by Klaus Haft DEFENDANT NUC Electronics Co., Ltd - 280, Nowon-ro - 41548 - Buk-gu, Daegu - KR Represented by Martin Momtschilow PATENT AT ISSUE: European Patent No. EP 2 028 981 PANEL/DEVISION: Panel of the Local Division in Mannheim DECIDING JUDGES: This order is issued by the presiding judge Tochtermann, the legally qualified judge Böttcher as judge-rapporteur and the legally qualified judge Perrotti. LANGUAGE OF PROCEEDINGS: English 2 SUBJECT-MATTER OF THE PROCEEDINGS: Patent infringement action – separation of proceedings REASONS FOR THE ORDER: The order is based on R. 302.1, R. 303.2, R. 340.2 RoP applied accordingly. The decision of the European Court of Justice in re C-339/22 (BSH Hausgeräte) had not been delivered until the end of the oral hearing but only thereafter on 25 February 2025. With the decision pending, no guidance was available concerning a fundamental question of European Law concerning the international jurisdiction under the Brussels Ia Regulation to be applied by the UPC pursuant Art. 71a, Art. 71b (1) (2) Brussels Ia Reg., even towards a defendant domiciled outside the EU. Although the ECJ delivered its decision before the date foreseen for the delivery of the decision in the proceedings at hand, it would be inadmissible, at least questionable in the light of parties’ right to be heard if the panel would now base its decision on the ECJ’s decision without the parties having had the opportunity to comment on this decision and its implications. However, it seems to be likewise inappropriate to hold a second oral hearing for the whole case although the panel could deliver a decision on the merits with regard to national parts of the patent-in-suit for which the panel has jurisdiction regardless of the outcome of said ECJ decision. The panel believes that, in any situation where the infringement proceedings is ready for decision with regard to single national parts only, such decision should not be withheld on a regular basis, if this would result in delaying in part the enforcement of claimant’s potential patent rights. Otherwise, the enforcement of these national parts would be delayed in comparison to a situation where national courts of the UPCA member states would have adjudicated on the respective national parts separately although there is no indication apparent that the UPCA intends to provide less protection. Therefore, in the panel’s opinion, such situation calls for R. 302.1, R. 303.2, R. 340.2 RoP to be applied accordingly in order to separate the proceedings with regard to national parts of traditional European bundle patents which are not ready for decision yet. Such separation of proceedings is not counter to Art. 33 (2) UPCA. This provision concentrates proceedings concerning the same parties and the same patent before a single division. However, it does not call for such proceedings to be connected. In particular in cases, where a part of the proceedings is ready for decision only, a panel, when exercising its discretion whether to connect such proceedings or not, has to take into account that the enforcement of claimant’s rights would be delayed in part. The parties were informed by order of 23 January 2025 that, with regard to non-UPC countries (Poland, Spain, (possibly) Turkey, United Kingdom), the panel may deal with the questions concerned by the pending ECJ decision in re C-339/22 (BSH Hausgeräte) in separate proceedings after the separation of cases in the event that no decision of the ECJ should be delivered until the oral hearing has taken place. The parties did not oppose. ORDER: Claimant’s requests based on the national parts of the patent-in-suit concerning Poland, Spain and the United Kingdom are separated and will be dealt with in one separate proceedings. 3 Issued in Mannheim on 11 March 2025 NAMES AND SIGNATURES Presiding judge Tochtermann Legally qualified judge Böttcher Legally qualified judge Perrotti

Key Holdings

• The Court found no proof of infringement in Turkey by the Korean defendant and ruled that Art. 71(b)(3) Brussels Regulation does not provide jurisdiction without a sufficient connection to a UPC member state.
• Jurisdiction can be disputed in the defence brief, not solely through a preliminary objection, though this approach is noted as impractical.
• UPC law (Art. 25-28 UPCA) applies to infringing acts after 1 June 2023, while national law applies to acts before, with a potential hardship exception for continuing infringements.
• Art. 26 UPCA is interpreted broadly to include acts that enable and support infringement, and the handover of infringing goods in Korea to EU distributors constitutes (indirect) infringement in the UPC.
• The Local Division Mannheim was deemed competent for infringements in Germany, but the comment suggests the UPC as a whole should be competent for the entire UPC territory under Art. 7(2) BR.

Tags

• Applicable Law
• Brussels Regulation
• Infringement
• Jurisdiction
• UPCA

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