IP Law Daily, PATENT NEWS: UPC Court of Appeals confirms jurisdiction for damages despite prior national ruling, (Jan 21, 2025)

By Saurabh Kashyap, B.A., LL.B., LL.M.

The appellate court found that Article 32(1)(a) UPCA permits the UPC to retain jurisdiction over standalone damages claims arising from prior infringement decisions.

The Court of Appeal of the Unified Patent Court (UPC CoA) has reversed a decision by the Hamburg Local Division, holding that the UPC has jurisdiction to determine damages even in cases where a national court has previously established infringement liability. The appellate court emphasized that the UPC's jurisdiction extends to claims arising from European patents that remained valid as of the Unified Patent Court Agreement's (UPCA) effective date, regardless of when the infringing acts occurred (Fives ECL, SAS v. REEL GmbH, UPC_CoA_30/2024, Jan. 16, 2025).

Background. Fives ECL, SAS (Fives), a French company, initiated patent infringement proceedings against REEL GmbH (REEL), a German competitor, before the Landgericht Düsseldorf in 2016. The litigation concerned European Patent No. EP 1 740 740, which pertains to a compact service module used in installations for aluminum electrolytic production. On 9 August 2022, the Düsseldorf court issued a final judgment, finding that REEL infringed the German part of the patent and ordering REEL to compensate Fives for all damages incurred from 2 December 2016 onward. This ruling was not appealed.

On 8 August 2023, Fives filed a separate action with the UPC’s Hamburg Local Division under Articles 32(1)(a) and 68 UPCA, seeking €6.5 million in damages, plus interest. Fives argued that the UPC, as a specialized patent court, was better positioned to assess damages in line with the harmonized framework envisaged by the UPCA. REEL opposed the claim, filing a preliminary objection under Rule 19.1 RoP, asserting that the UPC lacked jurisdiction. The local division agreed, dismissing Fives’ action on the grounds that the UPC’s jurisdiction did not extend to isolated damages actions based on prior national judgments.

Parties’ arguments. Fives contended that Article 32(1)(a) UPCA grants the UPC jurisdiction over all actions arising from patent infringement, including standalone claims for damages. According to Fives, the phrase “actions for actual or threatened infringements of patents” encompasses claims based on previously established infringements, provided the patent remains in force. It further argued that jurisdiction under the UPCA promotes uniformity in damage calculation methodologies across Contracting Member States (CMSs), aligning with the agreement’s objectives.

REEL argued that the UPCA does not authorize the UPC to hear isolated damages claims following a national court's judgment. It asserted that the scope of Article 32(1)(a) UPCA is limited to actions where infringement is directly at issue and that the rules of procedure, particularly Rule 125 RoP, treat damages as ancillary to infringement proceedings. REEL also warned that allowing the UPC to adjudicate damages in such cases could lead to inconsistent outcomes and encourage forum shopping.

Jurisdictional analysis. The appellate court reversed the local division's decision, concluding that the UPC has jurisdiction to decide damages in this case. It broadly interpreted Article 32(1)(a) UPCA, holding that claims for damages based on a national court's determination of infringement fall within the provision's scope. The court emphasized that neither the UPCA nor its Rules of Procedure limit jurisdiction to cases where the UPC itself adjudicates infringement. Instead, the court found that the UPCA's goal of harmonizing patent enforcement across CMSs supports jurisdiction in such cases.

Additionally, the court noted that Article 3(c) UPCA explicitly extends the UPC's jurisdiction to European patents that remained valid as of 1 June 2023, the agreement's effective date. According to the court, this provision ensures continuity in enforcement rights and allows the UPC to address claims arising from older patents, provided they were still in force when the UPCA came into effect.

Temporal applicability. REEL contended that the UPC lacked jurisdiction over acts of infringement committed before the UPCA’s effective date. The appellate court rejected this argument, clarifying that the timing of infringing acts does not preclude UPC jurisdiction as long as the European patent at issue was in force on 1 June 2023. The court noted that the UPCA does not impose temporal limitations restricting jurisdiction to post-enforcement activities, a position further supported by the harmonized nature of the UPC’s mandate.

Conclusion. The Court of Appeal set aside the Hamburg Local Division’s ruling, affirming the UPC’s jurisdiction to determine damages in standalone actions derived from prior national judgments. The case was remanded to the local division for further proceedings on the merits, underscoring the UPC’s role in promoting consistency in cross-border patent enforcement.

Judge: Kalden, R.

The case is No. UPC_CoA_30/2024.

Attorneys: Konstantin Schallmoser (Bonabry) for Fives ECL SAS. Benjamin Schröer (Hogan Lovells International) for REEL GmbH

Companies: Fives ECL, SAS; REEL GmbH

News: Patent