Extension and concentration of actions on appeal
HRC Düsseldorf, Judgment of 18.02.2021 – 2U 33/20
The Second Senate of the Higher Regional Court Düsseldorf had to deal with the question under which conditions an action can be extended to include further IP rights in appeal proceedings. In doing so, the Senate primarily included Section 145 PatG in the question of whether an extension to further patents in suit is expedient in the sense of Section 533 ZPO (Code of Civil Procedure) or not.
The plaintiff at first instance asserted the infringement of claims of the patent in suit (hereinafter “patent in suit A”) relating to “securing access to multimedia content by authenticated distance measurement”. The attacked device was a streaming adapter offered and distributed in Germany, which is used to transmit video content to a television via an HDMI input, whereby the HDMI standard allows the so-called HDCP technology as copy protection.
The method claim of the patent in suit A asserted at first instance provides, inter alia, that “a distance measurement between a first and a second communication device is to be performed and it is to be checked whether the measured distance is within a predefined distance interval”. The patent in suit A further provides that “the first and second communication devices share a common secret and said common secret is used”.
The Regional Court dismissed the action at first instance. The plaintiff appealed and extended the action to include a further patent in suit (hereinafter “patent in suit B”) which provides, inter alia, that “a distance measurement is carried out between the first and second communication devices“. Furthermore, it provides that the secret shared by the first and second communication devices is already shared before the distance measurement is carried out, whereby the patent in suit B defines the sharing of the secret in more detail by further features. Both patents belong to the same patent family.
The HRC Düsseldorf dismissed the extension of the action at second instance as inadmissible. In the reasons for its decision, however, the HRC did not only deal with the case at hand, but above all made general considerations as to the conditions under which an extension of the action to include a further patent in the appeal proceedings may or may not be expedient.
Whether the extension of the action is admissible in the appeal proceedings depends on § 533 ZPO (Code of Civil Procedure). The extension of the action must be expedient if the opponent does not consent to it. It is expedient if it is procedurally economical. The question is therefore whether the extension of the action prevents another legal dispute. However, it has to be taken into account that every plaintiff already expressed his or her will to enforce the claim by merely extending the action. Therefore, further litigation is nearly always prevented by an extension of the action. Prevention is therefore not a suitable criteria for determining the if an extension of the action is expedient in similar cases.
Therefore, the expediency is to be assessed according to whether the previous subject matter of the proceedings is usable for the assessment of the new motions (i.e. based on the newly introduced patent in suit) or not. If so, the extension of the action is expedient. If, however, the previous subject-matter of the proceedings is not usable in relation to the new motions, the extension would be inadmissible in principle.
If the action is extended to a further IP right, the previous subject-matter of the proceedings is generally not usable and the extension of the action is therefore inadmissible. This is because each IP right must always be interpreted on its own merits, even if the descriptions of the IP rights are partly identical. If necessary, further findings of facts were required, e.g. in the case of new or deviating claim features. This applied all the more if the prospects of success of an appeal against the grant of the further patent in suit or the protectability of a newly introduced IP right had to be examined and the prior art is also unknown till then.
The case could be different, however, if the plaintiff is forced by Sec. 145 Patent Act to assert the other IP rights in the same infringement dispute. In view of the vagueness of the requirements of Sec. 145 Patent Act (“the same or similar act”), it is sufficient if the plaintiff has to reckon with the serious possibility that Sec. 145 Patent Act would be held against him. However, this is contradicted by the interpretation of § 533 (2) ZPO (Code of Cicvil Procedure). The purpose of the appeal is to check and correct errors, but not to expand the facts.
The HRC Düsseldorf therefore is of the opiniion that an extension of the action is in any case expedient if the plaintiff, through no fault of his own, runs the risk of incorrectly assessing the requirements of Section 145 Patent Act. It is not its fault if the IP right could not yet be asserted in the first instance, e.g. because the IP right was not granted or the plaintiff was not entitled to sue.
However, the plaintiff caused the situation himself as soon as he was able to assert the IP rights at first instance, but did not due to procedural reasons. In addition, a number of disadvantages of the defendant must be taken into account, such as the lack of a factual instance, the late initiation of nullity proceedings or the possibility of the plaintiff to enforce the appeal judgement without providing security. In such a case, a careful examination of the individual case is required.
Thus, an extension is expedient if there are no substantial differences between the IP right asserted in the first instance and the IP right asserted only in the appeal instance, so that the previous subject-matter of the proceedings can be adopted. The case is similar if the infringement of new features is undisputed or if the realisation of these new features can be established on the basis of the findings of facts of the Regional Court.
In contrast, the extension of the action is not expedient if new findings of facts are necessary and/or a new comprehensive interpretation is required. The HRC Düsseldorf also assumed the latter in the present case. While patent in suit A provides for a specific distance measurement, patent in suit B only required an undefined distance measurement. In addition, patent in suit B provides that the “secret” between the first and second communication device has to be carried out before the distance measurement. This required a new definition of the scope of protection and thus also a new analysis of infringement.
Although the HRC Düsseldorf’s statements are comprehensible, the ruling does not seem to be consistent in the result.
On the one hand, the HRC emphasizes that an extension of the action is expedient if the realization of newly added or differently formulated features can already be assessed on the basis of the findings of facts made by the Regional Court.
On the other hand, however, it dismissed the extension of the action in the present case as inadmissible because a comprehensive redefinition of the scope of protection of the patent in suit B is required and many of the questions arising in determining the scope of protection of the new patent in suit B have to be examined for the first time in the appeal proceedings. However, this is a pure question of law. Once this legal question has been clarified, the HRC would be in a position to assess whether the realization of the newly added or differently formulated features can be assessed on the basis of the findings of facts made by the Regional Court. Whether this was the case in the present case cannot be inferred from the reasons for the judgement.
As a result, the patentee is advised to assert all comparable patents from its portfolio (in particular patents from the same family) at first instance and not to wait until the appeal for reasons of procedural economy. As the case at hand shows, such a presumably procedurally economical approach can be uneconomical for the patent proprietor in the end.
by Martin Koszycki