Infringement of registered Community design and sudden breach of established business relationships: limits of the exclusive jurisdiction of Civil courts

Published onSeptember 2016

French law provides that the entire litigation for designs, trademarks and patents, including the actions and claims on a related issue of unfair competition shall be brought before specific Civil courts (articles L.522-2, L.716-3 and L.615-17 of the French Intellectual Property Code respectively).

In line with recent decisions (see our article Is the Patent Court the patent license court?) the Cour de Cassation, the French Highest Civil Court issued a reminder that these provisions must be strictly construed (decision of the Commercial Chamber, 6 September 2016, case 15-16108).

In this case, the owner of a registered Community design had taken its principal business partner before the First Instance Civil Court of Paris for compensation for damages resulting from infringement of its Community design, unfair competition, as well as unlawful and sudden breach of established business relationships and abuse of economic dependence.

When the defendant contested the material competence of the civil court regarding the claims based on the sudden breach of established business relationships and abuse of economic dependence, the Court of Appeals of Paris considered that all claims were interrelated:

[…] acts of infringement, unfair competition, breach of established business relationships and abuse of economic dependence […] were, in fact, chained to the same period and affect the relationships between the same parties who maintained a flow of business; it is in this context that the designs were presented as simple “tests” to the company XXX, which used the same in a way that degraded their relationships; because of this connection and of the potential influence of the solution given to each of the actions initiated, it is useful to hear and judge them together”.

The Cour de Cassation annulled this ruling, since it was in breach with Article L.522-2 of the French Intellectual Property Code.

This decision must be approved. The text provides for two cumulative conditions so that civil courts can have jurisdiction: (i) acts must be interrelated with or connected to an IP infringement and (ii) acts must characterize unfair competition. The sudden breach of established business relationships is not covered by the same provision as that related to unfair competition, but falls within the provisions of Article L.442-6-I-5 of the Commercial Code. Therefore Commercial courts have exclusive jurisdiction over this highly technical type of litigation.

You know the proverb: “Do not bite off more than you can chew”. The exclusive jurisdiction of specialized courts for specific areas requiring a high level of technical expertise is the guarantee of an improved legal predictability for litigants. One of the downsides is the multiplication of lawsuits when different technical areas are involved even if the parties are the same. Surely this is the price to pay for better justice.

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