The availability of injunctions in cases of infringement of IPRs
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1 Question Q219 National Group: Austria Title: The availability of injunctions in cases of infringement of IPRs Contributors: Reporter within Working Committee: Peter Pawloy, Christian Gassauer-Fleissner [please insert name] Date: Questions I. Analysis of current law and case law The Groups are invited to answer the following questions under their national laws: Availability: Are injunctions for infringement of an IPR available on a provisional/preliminary basis? The respective Austrian Patents, Utility Model, Design Protection, Trademark Protection and Copyright Acts provide that preliminary injunctions may be granted inter alia to secure cease and desist claims (sec. 151b APA, sec. 41 AUMA, sec. 34 DPA, sec. 56 TPA and sec. 87c CA). Are injunctions for infringement of an IPR available on a permanent basis? Regarding Patents, Utility Models, Design Protection, Trademark Protection and Copyright, the respective Austrian Acts also provide for permanent injunctions (sec. 147 APA, sec. 41 AUMA, sec. 34 DPA, sec. 57 TPA and sec. 81 CA). Criteria: 3. If yes to question 1, what are the criteria for the grant of an injunction on a provisional/preliminary basis? With regard to preliminary injunctions, Austrian law focuses on the questions of infringement and validity. According to a lower evidentiary standard in interim proceedings, it is generally sufficient to convince the court that an IPR is valid and that the occurrence of an IP infringement is more likely than the opposite. With regard to patent law, there is an assumption of validity for a granted patent, so if the patent itself is not attacked by defendant, a patentee only has to show a strong 1
2 likelihood of infringement of the patent right in question in order to get a preliminary injunction. Moreover, in Austrian IPR infringement proceedings, preliminary injunctions can be issued regardless of whether or not the plaintiff is able to show that it would suffer irreparable harm without immediate injunctive relief. Unlike other countries legal systems there is no need to demonstrate a particular urgency, either (no periculum in mora). Therefore, the requirements for the issuance of a preliminary injunction are rather low in Austria. On the other hand, the plaintiff is often ordered to lodge a security deposit to safeguard possible damage claims of the defendant, in particular in patent cases. In general, a preliminary injunction may not lead to a situation that cannot be reversed in case it turns out as unfounded in the main proceedings, either. 4. If yes to question 2, what are the criteria for the grant of an injunction on a permanent basis? In general, the same criteria, ie validity of the IPR and infringement, are to be fulfilled. The evidentiary standard is higher in the main proceedings, however. In case of a nullity defence against a patent, the infringement court may suspend the main proceedings to await the outcome of invalidity proceedings pending before the patent office before granting a permanent injunction. 5. If not addressed in answering questions 3 and 4, does the criterion for the grant of an injunction differ depending on whether the injunction sought is on a provisional/preliminary or permanent basis? If so, how? In order to grant a preliminary injunction, it is only necessary to show on a prima facie basis that the IP is valid and the infringement of the IPR in question, whereas in the main proceedings a permanent injunction will only be granted if the infringement is fully proven. In patent infringement proceedings, the infringement court usually appoints an expert on this question, whose opinion is usually followed if it cannot be successfully contested, although the infringement question is a question of law to be decided by the court (according to recent case law of the Commercial Court of Vienna, experts can also be appointed in preliminary patent infringement proceedings). Validity of the IPR in question will also be looked at more closely in main proceedings. As mentioned in point 4. the main proceedings in patent cases are suspended if the nullity of the patent seems to be likely to the infringement court. If the infringement proceedings are not suspended and the decision of the Patent Office on the validity of the patent differs from the decision of the infringement court, the infringement proceedings may be resumed later. 2
3 6. Are the criteria for the grant of an injunction equally applicable to infringement of all IPRs? Yes 7. If no to 6, are there any specific criteria or considerations for the grant of an injunction for particular IPRs? If so, what criteria apply and to which IPRs? In order to be eligible for a preliminary injunction based on a registered trademark, the plaintiff must demonstrate that the trademark was genuinely used within the previous 5 years, ie that the trademark is not subject to cancellation for non-use. 8. Are there any specific criteria or considerations for particular subject matter, for example, pharmaceutical patents? If so, what criteria or considerations apply to what subject matter? In pharmaceutical cases an injunction is already available if the respective infringing medicine has been taken up in the Reimbursement Code of the Main Association of Austrian Social Insurance Institutions (provided the patent is found valid and infringed). No actual market sales have to be shown. Due to price cut mechanisms of the Austrian social insurance system a preliminary injunction application should be filed at the earliest moment possible, which is usually when a company applies for the generic to be listed in the so called Reimbursement Code. 9. Are there any specific considerations relevant to particular IP holders, for example, NPEs? If so, what considerations are relevant and to what IPR holders? The same rules are applicable to all IPR holders. A preliminary injunction based on a trademark may not be granted if the trademark was not genuinely used within the previous five years (see above 7), which may play a role with regard to NPEs. Discretion: 10. Is there any element of judicial discretion in relation to the grant of an injunction for infringement of IPRs? If so, how does the discretion apply? No. If the respective IPR is found valid and infringed in accordance with the lowered evidentiary standard (prima facie evidence) that applies in provisional proceedings, the respective Austrian IP Act provides that a preliminary injunction has to be granted. The same applies with regard to permanent injunctions if validity and infringement are proven according to the higher evidentiary standard that applies in the main proceedings. Judicial discretion factors in when the grant of a preliminary injunction is made subject to a security deposit to be lodged by the plaintiff in order to safeguard potential damage claims of the defendant in case the preliminary injunction turns out as unfounded. 3
4 11. Are there any circumstances in which a court must grant an injunction for infringement of an IPR? If so, in what circumstances? If the criteria mentioned above under 10 are fulfilled, the court has to grant an injunction. 12. Are there any circumstances where infringement of an IPR is proved and no permanent injunction is available? If so, in what circumstances? Considered that litigation sometimes starts shortly before IPRs, eg patents, expire, it is possible that a preliminary but no permanent injunction is granted given the fact that the IPR has already expired at the time a decision is rendered in the main proceedings. Scope: 13. Is an injunction granted only against named parties to the infringement proceeding, or is an injunction available more broadly against potential infringers such as customers or manufacturers who are not parties to the proceeding? An injunction is only granted against the defendant(s); accordingly it only affects the parties of the proceedings. 14. Is there a specific form of words used by your courts to describe the scope of the grant of an injunction? If so, what is the 'formula'? There is no specific formula; the scope of the preliminary injunction depends on the plaintiff s request, the wording of which is modelled on the wording of the statutory provisions the plaintiff relies on. In Patent and Utility Model cases, an injunction uses the wording of the claims, perhaps including obvious amendments falling within the scope of equivalence of such claims. 15. Is the grant of an injunction referable to the item(s) alleged to infringe the relevant IPR, or may the grant of an injunction be broader in scope? If it may be broader, what is the permissible scope of the injunction? The wording of the request for the issuance of a preliminary injunction refers to the prohibition of the infringing acts at issue and may also go beyond these acts where necessary to prevent easy circumvention by the defendant. Specific infringing items are often referred to, eg product names or market authorization numbers of pharmaceuticals, to facilitate enforcement. Such references are non-exhaustive examples, however, and the scope of the injunction is not limited to them. Judicial trends and practice: 16. Is there any discernible trend in your country as to the willingness or otherwise of courts to grant or refuse injunctions for particular IPRs or in relation to particular subject matter? 4
5 In patent infringement proceedings, courts seem to be more willing to grant preliminary injunctions in borderline cases but on the other hand began to demand higher security deposits from the plaintiffs. Another trend that can be observed at the moment is that courts from time to time already appoint experts in preliminary patent infringement proceedings, a practice completely uncommon until recently. 17. What, if any, has been the impact of the ebay v Merc-Exchange decision or any tendency of the courts in your jurisdiction to treat final injunctions as discretionary? Please explain whether the ebay v Merc-Exchange decision has been relied on or cited by your courts, and in what circumstances. Alternatively, or in addition, has there been any legal commentary on any potential implications of the ebay v Merc-Exchange decision in your jurisdiction? To our knowledge, there is no Austrian decision that cites the ebay v Merc- Exchange decision or an Austrian legal commentary referring this decision. Considered the legal framework for junctions in Austria, it is not likely that this decision will have any impact on future Austrian proceedings, either. II. Proposals for harmonisation The Groups are invited to put forward proposals for the adoption of harmonised rules in relation to injunctions for infringement of IPRs. More specifically, the Groups are invited to answer the following questions: Availability of provisional/preliminary injunctions: 18. Should there be a test or criteria for the grant of a provisional/preliminary injunction for the infringement of an IPR? If yes, what should that test or those criteria be? Naturally, whether the IPR is infringed and whether the IPR is valid, whereas the evidentiary standard must be lower than in the main proceedings. 19. If no, what principles should be considered in determining whether to grant an provisional/preliminary injunction? Availability of permanent injunctions: 20. Should there be a test for the grant of a permanent injunction for the infringement of an IPR? If yes, what should that test be? Again, whether the IPR is infringed and whether the IPR is valid. 21. If no, what principles should be considered in determining whether to grant a permanent injunction? Discretion: 22. In what circumstances, if any, should the grant of an injunction automatically follow a finding of infringement of an IPR? Naturally, whether the IPR is infringed and whether the IPR is valid. 5
6 23. In what circumstances, if any, should the grant of an injunction be denied notwithstanding a finding of infringement of an IPR? If the IPR already has expired at the time a decision is rendered in the main proceedings. Differences between IPRs: 24. Should the above test/principles apply equally to all IPRs? Yes. 25. If no, what should any differences be and why? Scope: 26. Should an injunction be granted only against named parties to infringement proceeding, or should an injunction be available more broadly against potential infringers such as customers or manufacturers who are not parties to the proceeding? Only against named parties. 27. What is the appropriate scope of an injunction prohibiting an infringer from committing further infringing acts? For example, should the injunction relate simply to the IP the subject of the allegation of infringement, or should the injunction be broader in scope? If broader, what is the permissible or desirable scope? An injunction should be limited to the scope of protection of the IPR Note: It will be helpful and appreciated if the Groups follow the order of the questions in their Reports and use the questions and numbers for each answer. If possible type your answers in a different colour. Thank you for your assistance. Summary There exist preliminary and permanent injunctions for infringements of IPR in Austria. The grant depends on the validity of the IPR and the infringement, but the standard of evidence is in main proceedings for permanent injunctions stricter than for preliminary injunctions. If the prerequisites are fulfilled the court has to grant the preliminary or permanent injunction. The scope of the grant depends on plaintiff s request. Judicial discretion applies in regard to the security deposit which may have to be paid by the plaintiff for potential damages of the defendant caused by the granted preliminary injunction. In Austria is a discernable trend that Courts seem to be more willing to grant preliminary injunctions but on the other hand began to demand security deposits or higher security deposits from the plaintiffs. Zusammenfassung Bei Rechtsverletzungen gegen IPR in Österreich stehen einstweilige Verfügungen und Unterlassungsklagen zur Verfügung. Die gerichtliche Bewilligung hängt von der Gültigkeit des IPR und von der Rechtsverletzung ab, aber das Beweismaß ist bei Unterlassungsklagen strenger. Wenn die Voraussetzungen erfüllt sind, hat das Gericht die einstweilige Verfügung oder das Unterlassungsurteil zu erlassen. Der Umfang der Bewilligung hängt von dem 6
7 beantragten Spruch ab. Einen richterlichen Ermessensspielraum gibt es hinsichtlich der Sicherheitsleistung, welche vom Kläger für mögliche Schäden, die dem Beklagten aufgrund der gewährten einstweiligen Verfügung entstehen können, verlangt werden kann. In Österreich ist ein Trend zu beobachten, dass Gerichte vermehrt einstweilige Verfügungen gewähren, dafür werden aber vermehrt Sicherheitsleistungen bzw höhere Sicherheitsleistungen vom Kläger verlangt. Résumé Contre des violations du Droit international privé, il est possible d introduire une action aux fins de s abstenir ou une demande en référé. L autorisation judiciaire dépend de la validité du DIP et de la violation du droit en question, mais la charge de la preuve est plus lourde pour des actions aux fins de s abstenir. Si les conditions sont satisfaites, le tribunal doit rendre l injonction en référé ou l arrêt aux fins de s abstenir. La portée de l autorisation dépend de celle de la demande. Il existe une marge discrétionnaire concernant les sûretés qui peuvent être exigées de la partie demanderesse au regard de possibles dommages pour la partie défenderesse en raison de la mise en œuvre des décisions requises. On peut observer une tendance des tribunaux autrichiens d autoriser un plus grand nombre de demandes en référé, en contrepartie, des sûretés ou des sûretés plus élevées sont exigées de la partie demanderesse. 7
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