Posted: April 1st, 2019
ArcelorMittal France v. Tata Steel IJmuiden B.V., Court of Appeal The Hague, 26 March 2019, Case No. ECLI:NL:GHDHA:2019:575
ArcelorMittal was the holder of European patent EP 2 242 863 B1 (“EP 863″), which relates to a “process for manufacturing stamped products, and stamped products prepared from the same”.
Tata Steel and other parties initiated opposition proceedings against the grant of EP 863 on 7 October 2014. The opposition division revoked EP 863 on 28 March 2017. ArcelorMittal appealed against this decision, which was rejected by the Technical Boards of Appeal on 8 November 2018.
Separately to the opposition proceedings, Tata Steel also initiated proceedings before the District Court of The Hague. Tata Steel requested the District Court, amongst others, to invalidate EP 863 as well as to order ArcelorMittal to pay the full costs of the proceedings pursuant to Article 1019h Dutch Code of Civil Proceedings (“DCCP”).
ArcelorMittal, on the basis of Article 83(4) of the Dutch Patents Act, requested the District Court to stay the proceedings until a final decision has been delivered in the opposition proceedings (“Motion 1”). In a decision on this procedural issue the District Court rejected Motion 1 as Tata Steel had argued that it would like to bring a potentially infringing product to the market. For this reason the District Court decided not to stay the proceedings and ordered ArcelorMittal to deliver a statement of defence.
In its statement of defence ArcelorMittal again requested to stay the proceedings. In addition and because Tata Steel had indicated that its potentially infringing product prevented a stay, ArcelorMittal also requested the District Court, pursuant to Article 223 DCCP, that Tata Steel should be ordered to inform ArcelorMittal’s counsel: (1) about all the properties of the products which Tata Steel was considering to manufacture and bring to the market, as far as they could fall within the scope of protection of EP 863, and (2) on a monthly basis on all envisaged, intended and/or adopted changes to those properties (“Motion 2”).
ArcelorMittal based Motion 2 on the fact that Tata Steel itself indicated that it was considering to bring a new product to the market, without specifying it. According to ArcelorMittal, the fact that the District Court considered this to be of sufficient interest not to stay the proceedings meant that the new product of Tata Steel should be considered to be a potentially infringing product. As a patent holder, ArcelorMittal therefore has a legitimate interest to receive further information on this product, on the basis of which ArcelorMittal would be able to assess whether or not it would like to enforce its patent.
On 13 September 2017, so before the Technical Boards of Appeal had decided on the appeal in the opposition proceedings, the District Court ruled that EP 863 is indeed invalid. The District Court therefore rejected Motion 2. The District Court, however, did not award full legal costs pursuant to article 1019h DCCP, as it qualified the proceedings as pure invalidity proceedings.
ArcelorMittal appealed against the judgment of the District Court of The Hague and Tata Steel lodged a cross-appeal to set aside the judgment of the District Court in order to award full legal costs pursuant to article 1019h DCCP.
During the appeal proceedings, however, the Technical Boards of Appeal denied the appeal in opposition proceedings, for which reason EP 863 was revoked. As a result of this, the parties agreed that ArcelorMittal no longer had an interest in its appeal. The Court of Appeal thus rejected ArcelorMittal’s appeal.
The only question that remained in appeal, was whether or not these proceedings allow for a full compensation of legal costs pursuant to Article 1019h DCCP.
Firstly, the Court of Appeal cites the Bericap decision of the CJEU (C-180/11 of 15 November 2012). The Court of Appeal then rules that the proceedings between Tata Steel and ArcelorMittal indeed qualifies as pure invalidity proceedings. After all, Invalidity proceedings are made available to a party such as Tata Steel which, without invoking its own intellectual property right, acts against the protection that ArcelorMittal could derive from EP 863. The invalidity proceedings are not intended to protect holders of intellectual property rights as referred to in the Enforcement Directive (Directive 2004/48/EC).
Under certain circumstances full compensation of legal costs may nevertheless be awarded, in the event that the invalidity proceedings are to be qualified as a defence against imminent enforcement by the holder. However, this is not the case in the present proceedings.
In order to qualify invalidity proceedings as an advanced defence against imminent enforcement, clear indications must be present that the IP holder actually has intentions to take enforcement action(s). There are no such indications in this case. The requests of ArcelorMittal to obtain information regarding the potentially infringing product (Motion 2) do not make this different. Contrary to what Tata Steel argues, such procedural requests should not be regarded as enforcement activities within the meaning of the Enforcement Directive, let alone that the main proceedings come to fall within the scope of Article 1019 DCCP as well.
The Court of Appeal therefore holds that ArcelorMittal has not enforced EP 863 by filing Motion 2. With Motion 2, ArcelorMittal only wishes to obtain information in order to be able to assess whether enforcement in the future is possible. Without that information, ArcelorMittal cannot determine whether enforcement would be possible, necessary and promising. After all, it was not clear to ArcelorMittal whether there is actually a product of Tata Steel and if indeed there is such a product, what the specifications of such product are.
Tata Steel’s argument that Motion 2 is essentially comparable to a claim to get access to documents pursuant to Article 843a DCCP does not hold. That is not the criterion. The criterion is to determine whether any enforcement actions within the meaning of Article 1019 DCCP and the Enforcement Directive have taken place or are imminent. Motion 2 cannot be regarded as an act of enforcement.
Finally, Tata Steel invoked Article 6 ECHR and Article 47 Charter of Fundamental Rights of the EU: a fair trial and more specific the principle of equality of arms. The Court of Appeal does not accept this argument. There are substantial differences between enforcement proceedings and invalidity proceedings. The legislator has chosen to introduce a specific legal costs regime for enforcement proceedings, to ensure a high, equivalent and homogeneous level of protection in the internal market in accordance with Art. 17 paragraph 2 of the Charter, by introducing a deterrent effect for enforcement proceedings (cf. also CJEU United Video). That does not automatically apply to pure invalidity proceedings.
The decision of the Court of Appeal (in Dutch) can be read here.
Headnote: Eelco Bergsma and Misja Boeken, Taylor Wessing