Case C-419/15, Thomas Philipps – licensees and standing [judgment 2016, ECLI:EU:C:2016:468]

Is the ability to mount an infringement action limited to the holder of a registered Community design right, or can a mere licensee bring that action in the German courts?

Background
A German company based in Saarbrücken is a licensee of a registered Community design on a spherical-shaped tablet of washing powder.

However, it suffered financial harm arising from the fact that another German company had been advertising and selling similar spherical tablets of washing-machine powder both via a website, and via commercial activities in 200 German shops.

Consequently, the licensee decided to sue the other German company for damages.

At first instance, the licensee won. However, the defendant then appealed on the ground that the relevant EU legislation does not allow a licensee to bring an action in respect of a Community design right.

The Oberlandsgericht in Düsseldorf did not know how to decide this ground of the appeal. It recalled that the court at first instance had held that the exclusive licensee of a Community design could, with the consent of the right holder (who in this case was a Swiss company), bring an action on its own and claim damages for losses pursuant to Article 32(3) of Council Regulation (EC) No 6/2002 on Community designs, even though the licensee had not been entered in the register of Community designs.

Nevertheless, it appeared to the appellate court that the success of the appeal turned on the correct interpretation to Article 33(2) of the Regulation which governs ‘Effects vis-à-vis third parties’ and provides:

1. ….

2. However, as regards registered Community designs, legal acts referred to in Articles 28, 29 and 32 shall only have effect vis-à-vis third parties in all the Member States after entry in the register. Nevertheless, such an act, before it is so entered, shall have effect vis-à-vis third parties who have acquired rights in the registered Community design after the date of that act but who knew of the act at the date on which the rights were acquired.

3. Paragraph 2 shall not apply to a person who acquires the registered Community design or a right concerning the registered Community design by way of transfer of the whole of the undertaking or by any other universal succession.

However, if the licensee would not be precluded from bringing an action, then the appellate court did not know whether the licensee could bring an action for damages in their own right (pursuant to Article 32(3)) or merely intervene in infringement action (pursuant to 32(4))?

Article 33 on ‘Licensing’ provides:

1. A Community design may be licensed for the whole or part of the Community. A licence may be exclusive or non-exclusive.

2. Without prejudice to any legal proceedings based on the law of contract, the holder may invoke the rights conferred by the Community design against a licensee who contravenes any provision in his licensing contract with regard to its duration, the form in which the design may be used, the range of products for which the licence is granted and the quality of products manufactured by the licensee.

3. Without prejudice to the provisions of the licensing contract, the licensee may bring proceedings for infringement of a Community design only if the right holder consents thereto. However, the holder of an exclusive licence may bring such proceedings if the right holder in the Community design, having been given notice to do so, does not himself bring infringement proceedings within an appropriate period.

4. A licensee shall, for the purpose of obtaining compensation for damage suffered by him, be entitled to intervene in an infringement action brought by the right holder in a Community design.

5. In the case of a registered Community design, the grant or transfer of a licence in respect of such right shall, at the request of one of the parties, be entered in the register and published.

In that context, the judges recalled that earlier on in the year, they had already made a preliminary reference to the CJEU about the German concept of Prozessstandschaft and the ability of people to mount litigation in their own right, and the correct scope of Article 23(1) of the Community Trade Mark Regulation – that a reference having been docketed by the CJEU as Case C-163/15, Youssef Hassan.

Questions Referred
According to the Curia Website, the Oberlandsgericht Düsseldorf has asked:

1. Does the first sentence of Article 33(2) of Council Regulation (EC) No 6/2002 of 12 December 2001 on Community designs […] preclude a licensee who has not been entered in the register of Community designs from bringing claims for the infringement of a registered Community design?

2. In the event that the first question is answered in the negative: may the exclusive licensee of a Community design, with the consent of the right holder, bring an action on its own claiming damages for its own loss under Article 32(3) of Council Regulation (EC) No 6/2002 of 12 December 2001 on Community designs or can the licensee only intervene in an action brought by the right holder for an infringement of its Community design under Article 32(4) of that regulation?

Update – 22 January 2016
The Oberlandsgericht Düsseldorf has made another reference concerning jurisdiction and EU design law; see further, Case C-24/16, Nintendo – jurisdiction by design.