No breaking new today, as the case I am going to talk about has already been commented upon in many various places.
Looks like I may have some catching up to do.
And yet, this is a prominent international patent case with a French component, and it involves a quite unusual point of law. So, I would be remiss if I failed to mention it on this blog.
The German company IPCom owns a telecom patent portfolio acquired from Robert Bosch. These patents are presented by the owner as essential for the 2G, 3G and 4G standards.
IPCom has been negotiating a license for some time with the Chinese group Lenovo (which also owns Motorola Mobility) – without any luck so far.
Lenovo was the first to shoot, litigation-wise, by filing a complaint with the District Court for the Northern District of California in March 2019, seeking the setting of the conditions of a worldwide FRAND license for the IPCom portfolio.
In July 2019, IPCom retaliated by initiating infringement proceedings based on one of their patents, EP 1841268, in the UK.
Probably wary of a likely escalation in other jurisdictions as well, Lenovo filed a motion for anti-suit injunction with the California court on September 18, 2019.
On October 16, 2019, IPCom performed infringement seizures against the French Lenovo subsidiaries and filed a motion for preliminary injunction.
On October 24, 2019, IPCom filed a petition with the juge des référés (the judge in charge of emergency interim proceedings) in Paris, seeking the withdrawal of the motion for anti-suit injunction filed by Lenovo in the U.S.
In other words, IPCom reacted to the motion for anti-suit injunction in the U.S. by a motion for anti-anti-suit injunction in France.
The hearing on the motion for anti-suit injunction in the U.S. was originally scheduled on November 14, 2019. Lenovo, in an attempt to beat the French proceedings, tried to bring this hearing forward by filing a motion to expedite with the U.S. court. IPCom was not intimidated and obtained an ex parte order from the French judge dated October 30, 2019, per which Lenovo was ordered to withdraw the motion to expedite, so that the hearing on the motion for anti-anti-suit injunction in France could take place on November 6, 2019, before the hearing on the motion for anti-suit injunction in the U.S.
Still on October 30, 2019, the motion to expedite was rejected by the U.S. court. The hearing in front of the juge des référés took place on November 6, 2019 as planned, and the judgment was issued on the same day, which is really remarkable.
At this point, you would probably venture that this post will mainly thrill civil procedure geeks, and not so much GSM, UMTS or LTE geeks – and you would be right.
Now that you have been warned, we can go through the judgment.
Before the judge was able to decide on the very procedural motion at stake… there were of course a few procedural preliminary objections to deal with.
First, Lenovo argued that the October 25, 2019 petition had not been properly served on the U.S. defendants before the deadline of October 29, 2019 which had been originally set by the judge for this service to take place.
However, the judge deemed that the formalities were properly performed by the due date. A French bailiff sent the petition on October 25, 2019 to the U.S. process server, and in parallel shipped it by express mail – which was received on October 28. Still in parallel, the petition was also sent to Lenovo’s usual French attorney. The petition was referred to by Lenovo on October 28 when they filed their motion to expedite with the California court. As a result, the juge des référés deemed that everything was in order, even if the U.S. process server did not provide the proof of service before the due date.
Second, Lenovo objected that the French judge lacked jurisdiction and that only the District Court for the Northern District of California had jurisdiction.
The judge dismissed this objection, mainly based on article 46 Code de procédure civile, per which, in a non-contractual dispute, a plaintiff may initiate proceedings in “the court of the place of the event causing liability or the one in whose district the damage was suffered”.
The judge noted that, if the anti-suit motion was granted in the U.S., IPCom would suffer harm in France. Therefore, the French judge had jurisdiction over the petition for an anti-anti-suit injunction.
Third, Lenovo raised an objection due to lis pendens and related proceedings.
Since a lawsuit was already pending in California, the French judge should defer to the U.S. court, Lenovo argued. Once again, the juge des référés disagreed, noting that the present action related to a different matter from the one in front of the U.S. court; and that it would not be proper (in the original text: “pas d’une bonne administration de la justice“) to defer to the U.S. court when the very purpose of IPCom’s petition is to prevent the U.S. proceedings from interfering with the French proceedings.
Finally, the judge was able to address the petition on the merits, so to speak.
The judge stated that article 808 Code de procédure civile empowers her to order any measure which is not serious challenged or which is justified by the existence of a dispute, if there is an emergency.
In the present case, the existence of an emergency was easy to establish, in view of the pending motion in front of the U.S. court.
Then, the judge stated that anti-suit injunctions are not allowed among member states of the EU.
With regard to a non-EU country such as the U.S., the judge held that an anti-suit injunction would violate the French international public order – except if a jurisdiction clause or an arbitration clause was at stake, which was not the case here.
Wrote the judge:
Indeed, the anti-suit injunction (except in the cases mentioned above) is an interference with the jurisdiction of the courts and indirectly results in violating the exclusive jurisdiction which each state enjoys in order to freely define the international jurisdiction of its courts.
Therefore, the judge granted IPCom’s petition.
Lenovo was ordered to immediately withdraw their motion for anti-suit injunction, insofar as it relates to legal proceedings which could be initiated by IPCom in France regarding EP 1841268. Lenovo was ordered not to file any other similar motion anywhere in the world. This order was issued under a penalty of 200,000 euros per violation and per day of non-compliance.
All in all, this ruling is a quite spectacular affirmation of sovereignty from the French court. The docket was fast-tracked at quasi-light speed, including with the interim issuance of the ex parte order mentioned above (which is rather exceptional), to make sure that the anti-anti-suit injunction was issued before the U.S. court could rule on the motion for anti-suit injunction.
My initial reaction is that this judgment fully makes sense. Patent infringement is a matter of national law, and it would thus be shocking if a patent proprietor could be prohibited by a foreign court to even attempt to assert its IP.
Accordingly, I understand that the high court in the UK also granted IPCom an anti-anti-suit injunction in the same case (see here). A few months earlier, in a different case and under different circumstances, an anti-anti-suit injunction was also issued in Germany (see here).
That said, without knowing of course who is acting in more or less good faith or bad faith, I do also have some sympathy with Lenovo’s position to some extent. The central issue in this dispute is that of setting the terms and conditions of the FRAND license for the IPCom portfolio. If the parties cannot agree, litigation must solve the issue.
But once the matter has already been brought in front of a court of law, what is the point in filing patent infringement suits here and there, beside exerting additional pressure on the would-be licensee?
To Lenovo’s point, centralized litigation makes more sense on a global standpoint.
But then again, on the other hand, there is something wrong in the notion that the first party to act can choose the forum that they please and then stop and freeze any possible initiative of the other party outside of that forum.
Why should the first one to pull the trigger always have the upper hand? After the Italian torpedoes which were in fashion some time ago, Lenovo tried to launch a U.S. torpedo, but it fizzled out.
Anyway, the case can easily make one think of a house of mirrors. It seems like an endless source of paradoxical questions.
To wit:
- Could Lenovo have filed a motion for anti-anti-anti-suit injunction in the U.S.? And so on? Is there any theoretical end to this game?
- By issuing the anti-anti-suit injunction, didn’t the French judge achieve exactly what she wanted to avoid in the first place, i.e. interfere with another court’s business? In other terms, if an anti-suit injunction is per se illegitimate, isn’t there some illegitimacy in an anti-anti-suit injunction as well?
- What if the anti-suit injunction had been granted in the U.S.? What would the effect have been in France? The injunction would have targeted the patent proprietor, not the French court itself. So, could the French court have thwarted the effect of the injunction by e.g. granting damages to the patent proprietor for any loss suffered due to non-compliance with the U.S. injunction? Would the court have had jurisdiction to do so?
Anyway, now that a few months have passed since this ruling, I bet that multiple new developments have taken place in this multinational game of 3D procedural chess, and I would be delighted to be updated by any readers in the know.
CASE REFERENCE: Tribunal de grande instance de Paris, ofronnance de référé, November 8, 2019, IPCom GmbH & Co. KG v. Lenovo Inc. et al., RG No. 19/59311.
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