C-89/99

OPINION OF MR JACOBS — CASE C-89/99

OPINION OF ADVOCATE GENERAL JACOBS delivered on 15 February 2001 1

1. In this reference from the Hoge Raad der TRIPs Agreement. The primary objective of Nederlanden (Supreme Court of the Neth- the TRIPs Agreement is to strengthen and erlands), the Court is asked a series of harmonise the protection of intellectual questions concerning the application and property on a world-wide scale. 3 interpretation of Article 50(6) of the Agree- ment on Trade-Related Aspects of Intellec- tual Property Rights (the TRIPs Agreement) in the context of proceedings involving the grant of provisional measures to restrain the alleged infringement of a trade mark. 3. Article 1 of the TRIPs Agreement, enti- tled 'Nature and Scope of Obligations', provides in paragraph 1:

(a) to prevent an infringement of any intellectual property right from occur- ring, and in particular to prevent the entry into the channels of commerce in '1. Members shall ensure that enforcement their jurisdiction of goods, including procedures as specified in this Part are imported goods immediately after cus- available under their law so as to permit toms clearance; effective action against any act of infringe- ment of intellectual property rights covered by this Agreement, including expeditious remedies to prevent infringements and remedies which constitute a deterrent to further infringements. These procedures (b) to preserve relevant evidence in regard shall be applied in such a manner as to to the alleged infringement. avoid the creation of barriers to legitimate trade and to provide for safeguards against their abuse.

2. The judicial authorities shall have the authority to adopt provisional measures inaudita altera parte where appropriate, in particular where any delay is likely to cause 2. Procedures concerning the enforcement irreparable harm to the right holder, or of intellectual property rights shall be fair where there is a demonstrable risk of and equitable. They shall not be unneces- evidence being destroyed. sarily complicated or costly, or entail unreasonable time-limits or unwarranted delays.'

4 — See Article XI.

I - 5855

OPINION OF MR JACOBS — CASE C-89/99

4. Where provisional measures have been the applicant, upon request of the defen- adopted inaudita altera parte, the parties dant, to provide the defendant appropriate affected shall be given notice, without delay compensation for any injury caused by after the execution of the measures at the these measures. latest. A review, including a right to be heard, shall take place upon request of the defendant with a view to deciding, within a reasonable period after the notification of the measures, whether these measures shall be modified, revoked or confirmed. 8. To the extent that any provisional mea- sure can be ordered as a result of admin- istrative procedures, such procedures shall conform to principles equivalent in sub- stance to those set forth in this Section.'

tence, of the agreements reached in the trade mark protected under national — Uruguay Round multilateral negotiations and in that case Uniform Benelux — trade- (1986-1994). 5Those agreements are pub- mark law. 11 More recently in Parfums lished as annexes to the Decision. 6They Christian Dior 12 the Court confirmed the entered into force on 1 January 1996 for ruling in Hermès and explained that its the Community and its Member States. jurisdiction to interpret Article 50 of the TRIPs Agreement was not restricted to situations covered by trade-mark law, but also encompassed situations concerning other intellectual property rights falling 9. As a matter of Community law, the within the scope of the TRIPs Agree- TRIPs Agreement is a mixed agreement: ment. 13 competence for concluding it was shared between the Community and its Member States. 7 The Community and the Member States were jointly competent in areas within the scope of the TRIPs Agreement where the Community had already intro- duced only partial harmonisation mea- sures, as in the field of trade marks. With The scheme and aims of Article 50 particular regard to the provisions of the TRIPs Agreement relating to the measures to be adopted to secure the effective protection of intellectual property rights, including the rules regarding provisional 11. Part III of the TRIPs Agreement repre- measures, the Court has stressed that the sents the first attempt to grapple at inter- Community and its Member States were national level with the problems of enforce- jointly competent. 8 ment of intellectual property rights and reflects the fact that, at the time of negotia- tion of the Agreement, the industrialised countries were increasingly concerned about the mounting problems of counter- 10. The Court in Hermès9 ruled that it had feit and pirated goods. Thus for example jurisdiction to interpret Article 50 of the one commentator 14 reports that in 1985 TRIPs Agreement not only in situations industries in selected countries lost over where the national courts were called upon USD 1.3 billion annually from ineffective to order provisional measures for the international copyright protection. Based protection of rights arising under a Com- on these figures, the International Intellec- munity trade mark 10 but also where the tual Property Alliance stressed in its report case concerned the rights arising under a of that year to the US International Trade Commission that 'the US government's goal

14. There will, of course, be other cases in 12. The provisions that now constitute Part which a provisional measure is obtained III, including Article 50, were prompted by where the circumstances are less black and the industrialised nations, in particular the white: there may be a genuine defence to US, Europe, Japan and Australia, in the allegation of infringement — a defence response to those concerns. 16 Article 50 which, if the measure is obtained ex parte was the subject of relatively few drafting (inaudita altera parte), the defendant will battles in the course of negotiation and be unable to advance in the context of the hence suffered relatively little amend- interim application. There may even be ment. 17 It may accordingly be regarded as cases where it is the defendant whose broadly reflecting the desires of the indus- intellectual property rights are infringed trialised countries. by the conduct of the claimant.

I-5858

SCHIEVING-NIJSTAD AND OTHERS

ist ends. That objective, it adds, is in implementing the provisions of this Agree- accordance with Article 41(1) and (2) 18 ment within their own legal system and of the Agreement. Those provisions intro- practice'. duce Part III, which includes Article 50. Article 41(1) it will be recalled requires enforcement procedures to be applied so as to avoid the creation of barriers to legit- imate trade and to provide for safeguards against their abuse. Article 41(2) requires 19. Second, the court hearing the applica- that enforcement procedures should be fair tion for provisional measures (or, if rele- and equitable and should not be unneces- vant, the court hearing an appeal against sarily complicated or costly. The philoso- the grant or refusal of provisional mea- phy underlying those provisions — in sures) is clearly best placed to decide on summary, equilibrium and fairness — certain procedural matters where the should be respected when interpreting the Agreement and national law so permit. paragraphs of Article 50. That court will be aware of the facts and thus be in a position to ensure that in a particular case the requirements of equili- brium and fairness underlying Article 50(6) are met.

17. Finally, I would make the following two points about the effective application of Article 50(6). 20. In the light of those factors, I will now turn to the main proceedings and the questions referred.

22. Route 66 was a famous interstate place on 6 November 1995. On 9 January highway in the United States, named in 1996 the President of the Rechtbank (Dis- 1926 and running for 2 400 miles through trict Court), Assen, granted the relief eight states from Michigan Avenue in claimed by Mr Groeneveld, ordering Mr Chicago to Santa Monica in California. Schieving and Mr Nijstad (1) to desist and Route 66 has become (and has indeed refrain from using the name(s) '(Café) perhaps always been) something of a cul- Route 66' and the marks 'ROUTE 66', tural icon in the United States and further and/or any other sign similar to the regis- afield (there are for example 'Route 66 tered marks 'ROUTE 66', in relation to the Associations' in Norway, Italy, and Japan). goods and services in respect of which It featured in John Steinbeck's The Grapes those marks are registered (including hotel/ of Wrath: described as 'the mother road' it catering services) and (2) to desist and was the route taken by over 200 000 people refrain from using in any other way the who in the 1930s abandoned the dust-bowl marks 'ROUTE 66' and/or any similar sign, of the Mid-West and migrated to Califor- such as the contested name '(Café) Route nia. It also appears in Jack Kerouac's On 66', in such a way that they are unlawfully the Road and has given rise to popular exploited for economic purposes in circum- songs and television series. stances which may infringe the rights of the proprietor(s) of the marks.

23. The form of the pictorial marks regis- tered by Mr Groeneveld is derived from the 26. By judgment of 3 September 1997 the form taken by the road sign indicating Gerechtshof te Leeuwarden (Regional Route 66 at the time when the whole of it Court of Appeal, Leeuwarden) upheld the was still in use. I would in passing mention judgment of the President, subject to a that it seems surprising to me that such a modification of the wording of the judg- sign has been registered as a trade mark. ment so as to bring it into line with the wording of the Uniform Benelux Law on Trade Marks.

28. Noting that the TRIPs Agreement had proceedings are not commenced within entered into force in the Netherlands on 20 working days or 31 calendar days 1 January 1996, Mr Schieving and Mr Nij- (whichever is the longer period), or is a stad had requested the Gerechtshof, in request by the party against whom a reliance on Article 50(6) of that Agree- provisional measure has been ordered ment, to declare that, if and in so far as the (invariably) necessary in order for that orders made by the President in his judg- measure to lapse? ment of 9 January 1996 may have been capable of being upheld or granted, those orders had remained operative for a period not exceeding 20 working days or 31 (3) Where the time-limit within which the calendar days after service, whichever was substantive proceedings must be the longer, after which the orders in ques- brought is not prescribed in the provi- tion must be regarded as having lapsed, sional measures ordered, does it com- since Mr Groeneveld had not instituted mence on: substantive proceedings within that period.

(a) the day after the date on which the 29. Before the Hoge Raad Mr Schieving court ordered the provisional mea- and Mr Nijstad complained that, by reject- sure in question; or ing that plea and ruling that their applica- tion was to be dismissed, the Gerechtshof had misconstrued Article 50(6) of the TRIPs Agreement. The Hoge Raad accord- (b) the day after the date on which the ingly referred the following questions for a decision ordering the provisional preliminary ruling: measure was served on the defen- dant; or

(6) Is Article 50 of the TRIPs Agreement applicable where that Agreement enters into force in the Member State con- cerned on a date following the closure 'In all cases in which, having regard to the of the trial procedure at first instance interests of the parties, an immediate but before the court seised of the first- provisional measure is necessary on instance proceedings has delivered its grounds of urgency, the application may decision?' be made at a hearing which the President shall hold for that purpose on working days which he shall fix.'

36. The question whether the Netherlands procedure was a 'provisional measure' within the meaning of Article 50(1) of the TRIPs Agreement, and hence whether Arti- cle 50(6) applied to that procedure, was at 39. It follows from paragraphs 47 and 48 issue in Hermès. 20 In his order for refer- of the recent judgment in Parfums Chris- ence in that case, the President of the tian Dior 21 that, in so far as the field of Arrondissementsrechtbank observed that in trade marks is concerned, it is for Commu- interim proceedings under Netherlands law nity law to determine the legal effects of the defendant is summoned to appear, the Article 50 of the TRIPs Agreement on the parties have the right to be heard, and the national rules governing provisional mea- judge hearing the application for interim sures. The legal effects of Article 50 of the measures makes an assessment of the TRIPs Agreement 'in a field in respect of substance of the case, which he also sets which the Community has not yet legis- out in a reasoned written decision, against lated and which consequently falls within which an appeal may be lodged. Moreover, the competence of the Member States' are although the parties then have the right to by contrast to be determined by national initiate proceedings on the merits, in mat- law. ters falling within the scope of the TRIPs Agreement they normally abide by the interim decision.

40. I must confess that it is not easy to understand why Community law governs the effects of Article 50 of the TRIPs 37. In its judgment in Hermès, the Court Agreement not only where a Community ruled that a measure whose purpose was to trade mark is involved but also in situations put an end to alleged infringements of a concerning national (Uniform Benelux) trade-mark right and which was adopted in trade marks. 22 It must be borne in mind the course of such a procedure was a that, according to the Court's own case- 'provisional measure' within the meaning law, Article 50 of the TRIPs Agreement of Article 50(1).

The second question 41. Be that as it may, the Court decided in Parfums Christian Dior that the effect of Article 50 of the TRIPs Agreement was not such as to create rights upon which indivi- 43. By its second question the referring duals could rely before the courts by virtue court asks whether provisional measures of Community law. The Court added, within the meaning of Article 50(1) and (2) however, that the finding that the provi- lapse by operation of law if the substantive sions of the TRIPs Agreement did not have proceedings are not instituted either within direct effect in that sense did not fully the period prescribed in the provisional resolve the problem raised by the national measure or, where no period is prescribed, courts. It went on to state that, in a field to within 20 working days or 31 calendar which the TRIPs Agreement applied and in days (whichever is the longer period), or respect of which the Community had whether a request by the party against already legislated, as in the field of trade whom a provisional measure has been marks, the judicial authorities of the Mem- ordered is necessary in order for that ber States were required by virtue of measure to lapse. Community law, when called upon to apply their national rules with a view to ordering provisional measures for the protection of rights falling within such a field, to do so as far as possible in the light of the wording and purpose of Article 50 of the TRIPs 44. It will be recalled that Article 50(6) Agreement. 24 provides that provisional measures shall, upon request by the defendant, be revoked

48. The latter interpretation is confirmed by the French and the Spanish versions of the provision, the only other authentic texts. 27 In both those languages the words 45. It may of course be that in some 'upon request by the defendant'28 follow systems — as before this Court 26 — an the words 'shall... be revoked or otherwise application for provisional measures may cease to have effect',29 thus making it clear be made only if proceedings on the merits that the defendant's request is necessary in are commenced at the same time or have either event. In my view therefore, and as already been commenced. The interpreta- Mr Groeneveld, the United Kingdom and tion of Article 50(6) sought by the national the Commission submit, Article 50(6) court will be relevant however to those applies only where there is a request by systems where an application for provi- the defendant, whether the provisional sional measures may be made before pro- measures cease to have effect by revocation ceedings on the merits are commenced. or 'otherwise'.

issue of proceedings on the merits. As ordering the provisional measure became discussed above, 30 that provision aims to definitive and no longer open to challenge. balance the interests of the parties most concerned by the grant of provisional measures in proceedings for the protection of intellectual property rights. In my view, that balance is not upset if the defendant is granted more extensive protection than that conferred by Article 50(6) provided that the interests of the owner of the 51. Since there is nothing in Article 50(6) intellectual property rights at issue are not itself which provides the answer to this at the same time unduly prejudiced. A question, I consider that, in the absence of national rule that provisional measures any relevant Community legislation, it is automatically lapsed if the main proceed- for the domestic legal system of each ings were not issued on the same day would Member State, provided in each case that clearly not respect the necessary balance of the national rule at issue adequately reflects interests; a rule that provisional measures the wording and purpose of Article 50(6). automatically lapsed if the main proceed- Subject to that qualification, to which I will ings were not issued within one month, on return, it would in my view be unwise to the other hand, might well respect that seek to read into that provision further balance. detailed procedural requirements which the authors of the TRIPs Agreement did not see fit to prescribe.

the provisional measures, unless deter- request, in Germany (generally between mined otherwise by the court. 31 two weeks and one month from service of the decision ordering the time-limit). In England and Wales the court must require the applicant to undertake to commence the main action immediately; in Scotland 54. By December 1990, when the Draft and Ireland32 the practice is similar. In Final Act Embodying the Results of the Greece the court may order a time-limit Uruguay Round of Multilateral Trade (not less than 30 days). In Belgium, France Negotiations was submitted to Ministers and Luxembourg the practice is generally, in Brussels, the text of Article 50(6) was but not universally, for the court to order a identical to that in the Agreement as time-limit which varies from case to case. adopted. The reference to time running The position in the Netherlands is that from notification of the measures had been there is no statutory or express judicial deleted and no other indication of when power but judges are currently tending to time should start to run had been put in its impose time-limits of several months from place. That also supports the view that the several possible starting points (for exam- negotiators considered it appropriate to ple, after the decision ordering the provi- leave the matter to the domestic laws of sional measures has become definitive, or the Members. when the defendant lodges a request for the revocation of the provisional measures) which do not include the date of the order or its service.

in respect of which the Community has 58. The answer to the national court's third legislated, 33 may be served by procedural question is thus in principle to be found in rules which vary slightly in the detail. Thus national law. As can be seen from the above it seems to me that the wording and summary of national rules and practices, purpose of Article 50(6) are not prejudiced however, in a minority of Member States by national rules according to which the national law does not appear to provide a time-limit may run variously from the date readily ascertainable rule or practice on the of (or the day after) the decision ordering basis of which it may be determined when the provisional measures or from the date time starts running where the court order- of (or the day after) service of that decision. ing the provisional measures does not (It should be noted that time-limits often prescribe a time-limit for the commence- run not from the event but from the ment of the main proceedings. In those following day: see for example Arti- circumstances, I consider that it will like- cle 80(1)(a) of the Rules of Procedure of wise be consistent with the wording and the Court of Justice.) Since in the case of purpose of Article 50(6) for time to run provisional measures adopted inaudita either from the date of the decision order- altera parte Article 50(4) of the TRIPs ing the provisional measures or from the Agreement already requires that the defen- date of service of that decision (or again in dant should be given prompt notice ('with- either case from the day after the relevant out delay after the execution of the mea- date). sures at the latest'), the decision should in any event be promptly served.

bringing proceedings on the merits is again 63. The United Kingdom notes that an a matter for the domestic legal system of appellate court will be as aware of the each Member State. That follows as Arti- facts and matters giving rise to the dispute cle 50(6) expressly provides that the deter- as a court of first instance; thus where the mination of a reasonable period by the court of first instance has failed to deter- judicial authority ordering the measures mine what constitutes a reasonable period, arises only where a Member's law so it is desirable that the appellate court permits. As is apparent from paragraph should do so on the basis of the facts, 55 above, in many Member States a provided that it is permitted to do so under mandatory time-limit is fixed by statute: national law. The Commission similarly in such States it is clearly not relevant to considers that it is not obvious why only ask whether the court may or must fix a the court of first instance should be the time-limit. 'judicial authority ordering the measures': the appellate court may be the first to impose provisional measures or may affirm or modify them in the course of the appeal.

I - 5869

OPINION OF MR JACOBS — CASE C-89/99

of its own motion, it seems to me that the 69. Third, national law determines when wording and purpose of Article 50(6) are the time-limit within which the substantive best reflected if that court normally does so proceedings must be brought commences as a matter of practice even in the absence where it is not prescribed in the decision of application by one of the parties. ordering the provisional measures. It is Although a time-limit set at first instance consistent with the wording and purpose of may, as suggested above, call for variation Article 50(6) for time to run either from the in certain circumstances, other circum- date of the decision ordering the provi- stances may equally be envisaged in which sional measures or from the date of service it would be appropriate for the original of that decision (or in either case from the time-limit to stand notwithstanding an day after that date). appeal.

70. Fourth, national law determines whe- ther a court which orders a provisional measure must of its own motion fix a time- limit within which substantive proceedings are to be instituted. Conclusions on the first five questions

71. Fifth, if permitted by national law, an 66. It may be useful at this stage to appellate court ordering, confirming or summarise the conclusions so far reached varying a provisional measure may of its on the interpretation of Article 50(6). own motion prescribe a time-limit within which proceedings on the merits must be commenced.

67. The answer to the first question is given by the Parfums Christian Dior judgment. The sixth question

74. In order to answer the national court's final question, it must first be determined whether 'acts' in Article 70(1) means solely the acts of infringement allegedly commit- ted by the defendant or whether 'acts' is intended in the broader sense which would encompass a judicial act such as the interlocutory order given at first instance 77. Since it may be assumed that the act of on 9 January 1996. The former interpreta- infringement allegedly committed by the tion seems more consistent with the general defendants in the present case (namely the tenor of Article 70, most of which makes operation of a café called 'Route 66'), being clear links between the date of entry into in the nature of a continuing act, continued force of the Agreement and the status of the at least until the date of judgment (9 Jan- subject-matter of intellectual property uary 1996) and hence occurred both before rights: see for example paragraphs (2) and and after the date of application of the (3). In addition, Article 70(4) uses the term Agreement for the Netherlands (1 January 'acts' in a context which is clearly limited 1996), it seems clear that Article 50 is to factual rather than legal acts. applicable.

78. Article 50 was accordingly applicable when the President of the Rechtbank, 75. Moreover 'act' is used in Article 41(1) Assen, ordered the provisional measures in the phrase 'act of infringement'. Judg- at issue (by judgment of 9 January 1996) ments in the general sense however are and when the Gerechtshof te Leeuwarden referred to as 'judicial decisions' or 'deci- upheld those measures on appeal (by judg- sions' (see Article 41(3), 41(4)). ment of 3 September 1997).

(2) Under Article 50(6) of the TRIPs Agreement, a request by the party against whom a provisional measure has been ordered is necessary in order for that measure to be revoked or otherwise cease to have effect. I - 5872

SCHIEVING-NIJSTAD AND OTHERS

(3) Where a decision ordering a provisional measure within the meaning of Article 50(6) of the TRIPs Agreement does not prescribe a commencement date for the time-limit within which proceedings on the merits must be initiated, the national law of the Member State concerned determines when that time-limit commences. It is consistent with the wording and purpose of Article 50(6) for time to run either from the date of the decision ordering the provisional measures or from the date of service of that decision (or in either case from the day after that date).

(4) The national law of the Member State concerned determines whether a court which orders a provisional measure within the meaning of Article 50(6) of the TRIPs Agreement must of its own motion fix a time-limit within which proceedings on the merits must be initiated.

(5) The national law of the Member State concerned determines whether an appellate court may of its own motion prescribe a time-limit within which proceedings on the merits must be initiated.

(6) Article 50 of the TRIPs Agreement is applicable where that Agreement enters into force in the Member State concerned on a date following the close of proceedings at first instance but before the court seised of the first-instance proceedings has delivered its decision, provided that the act of infringement in respect of which a provisional measure within the meaning of Article 50(6) is ordered is committed or continues after the TRIPs Agreement has entered into force.