German court calls for better enforcement of preliminary injunctions in patent infringement case
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German court calls for better enforcement of preliminary injunctions in patent infringement case

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Christian Meyer of Maiwald looks at the ineffective enforcement of a preliminary injunction in a German case concerning the requirements for a bank guarantee as security

The Higher Regional Court of Düsseldorf specified the requirements for a bank guarantee as a security for enforcement of a preliminary injunction (decision of June 25 2020, docket no. I-2 U 51/19).

In the underlying case, the injunction plaintiff first obtained a temporary injunction for patent infringement against the injunction opponent before the Düsseldorf Regional Court, the enforcement of which, as usual in such cases, is dependent on the provision of a security.

In order to enforce an interim injunction, it must be ‘executed’ within one month, otherwise it loses its effect (Section 929 (2) German Code of Civil Procedure). In the case of an injunction issued after oral proceedings, the so-called enforcement period begins with the pronouncement of the judgment. If enforcement is dependent on the provision of security, this must also be rendered and proven within the one-month period.

The injunction plaintiff submitted a surety bond (pursuant to Section 108 p 2 German Code of Civil Procedure) to the injunction opponent within the enforcement period, citing as the sole circumstances for the security the "revocation or modification of the injunction award from the regional court judgment."

In the appeal brought against the Regional Court’s judgment, the opponent invoked, inter alia, the insufficiency of the guarantee submitted. The Düsseldorf Higher Regional Court allowed the appeal and confirmed that the declaration of surety was insufficient. The court explained that the above-mentioned circumstance for the security was common for provisionally enforceable titles with respect to the principal claim and also sufficient in terms of content. However, due to the possibility of liability for damages under Section 945 German Code of Civil Procedure, the wording was not sufficient for provisional injunction proceedings, as it did not address the case of a lapse of the executed provisional injunction without cancellation or amendment.

Rather, the required security, if provided in the form of a guarantee, must address all liability scenarios so that no ‘reasonable doubt’ can arise as to the scope of the guarantee.

The present decision makes it clear that, despite the generally existent interest in the prompt enforcement of interim injunctions, sufficient care is required not only in the drafting of the application for an injunction, but also in the context of the subsequent enforcement of the injunction. In this regard, particular attention must also be paid to the wording of the common templates frequently used by banks or savings banks following a corresponding order to issue a declaration of guarantee, to ensure that this is suitable for the specific individual case.

 

Christian Meyer

Principal, Maiwald

E: meyer@maiwald.eu

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