The Italian Supreme Court rules out the Italian jurisdiction over the infringement of the German portion of an international design registration

Picture by Matthias Lemm from pixabay.com

Jurisdictional issues have always been of great interest in the field of intellectual property. In Italy, the most debated issues in the past were the so-called “torpedo” actions in patent litigation, which we talked about here and here in this blog. Recently, the United Chambers of the Court of Cassation instead discussed jurisdiction in a case of declaration of non-infringement of an international design (order no. 13504/2023).

The German company Alfa had requested its compatriot Beta to cease marketing, in Germany, a tap produced by the Italian company Gamma,  which was in alleged violation of its international design. In response, Gamma had taken action before the court of Milan against Alfa and its Italian subsidiary requesting the Court to declare, in summary:

1) the nullity of the Italian portion of the Alfa design registration;

2) that the production and marketing of the Gamma tap did not infringe on Alfa’s design rights or amount to an act of unfair competition to the detriment of the latter;

3) that Alfa's behavior constituted unlawful interference in the relationship between Gamma and its German distributor Beta.

Alfa objected, citing lack of jurisdiction for claims 2 and 3 and Gamma subsequently appealed to the Court of Cassation for a regulation on jurisdiction, following which the Court’s United Chambers upheld Alfa's complaints. In fact, they declared the Italian judge’s lack of juristiction on all claims except 1 (which was not under discussion). The Court reached this conclusion on the following grounds.

a.     Based on Art. 4 EU Reg. n. 1215/12, persons domiciled in a Member State must be sued before the courts of that State.

b.     According to the Art. 7, alternatively, in the matter of torts they can also be summoned before the courts of the "place where the harmful event occurred or may occur". This rule, the Court recalls:

i)       also applies to actions for the declaration of non-infringement;

ii)     covers both the place where the harmful conduct took place and the place where the damage occurred. However, the latter is only the place where the harmful event or so-called "initial damage" occurred, hence:

·       it is not possible to act in any place where negative consequences have subsequently occurred;

·       it cannot generally be assumed that the initial damage occurs at the domicile of the injured party, simply due to the fact that it has assets there and would suffer damage resulting from pecuniary losses suffered elsewhere;

·       the principle sanctioned by the EU Court of Justice in C-523/10 for trademark infringement must be applied, according to which jurisdiction must be attributed, "in respect of damage occurred, the Courts of the Member State in which the right at issue is protected".

c.     Based on both the above provisions, the jurisdiction therefore lies with the German judge, given that the defendant is a German company and had sent a warning to another German company for the infringement of the German portion of its registered design, in Germany.

d.     On the other hand, the jurisprudence of the CJEU in C-194/16 referred to by Gamma is not applicable, as it "concerned a completely different case ― and entirely distinct, due to the functioning of the Internet network ― of the infringement of the rights of a legal person through the publication, on the Internet, of allegedly inaccurate data concerning them”. Instead, the damage claimed by Gamma concerned the interference in the contractual relationship with its German reseller Beta, which allegedly took place in Germany.

e.     The jurisdiction of the Italian judge cannot even be based on the fact that Gamma had also sued the subsidiary of Alfa, and therefore on art. 8 of the Regulation. Indeed:

-        pursuant to this provision, in the event of multiple defendants domiciled in different member States, these can be summoned together before the courts of the domicile of only one of them "provided the claims are so closely connected that it is expedient to hear and determine them together to avoid the risk of irreconcilable judgments resulting from separate proceedings”;

-        this close connection "does not exist when it comes to assessing the infringement of different national portions of the same industrial property right, since these portions must be considered autonomous and therefore assessable separately on the basis of each domestic legislation, without the risk of conflicting decisions (EU Court 13 July 2006, case C-539/03)”;                                                             

-        summoning a defendant who is "merely fictitious, but in reality disinterested, on the basis of a pretext or prima facie ungrounded allegations" is not sufficient to establish the jurisdiction of a State. In the specific case, Alfa's Italian subsidiary had not exercised or claimed any rights to the German portion of the Alfa design, so there was no "plausible reason " for its involvement in the proceedings for the declaration of non-infringement of the German portion of the Alfa design.

Hence, in conclusion, the Italian judge’s jurisdiction was deemed to be limited to the request for a declaration of non-infringement of the Italian portion of Alfa’s international design registration, which in fact was not under discussion.