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2024-10-29 App_53031_2024

Source: 
Application for suspensive effect, Intermediary, Order to provide security
Art. 21 UPCA - Requests for preliminary rulings, Art. 34 UPCA - Territorial scope of decisions, Art. 63 UPCA - Permanent injunctions, Art. 74 UPCA - Effects of an appeal, Art. 76 UPCA - Basis for decisions and right to be heard
Rule 102 – Referral to the panel, Rule 113 – Duration of the oral hearing, Rule 223 – Application for suspensive effect, Rule 263 – Leave to change claim or amend case, Rule 266 – Preliminary references to the Court of Justice of the European Union, Rule 352 – Binding effect of decisions or orders subject to security
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The following text is not a complete transcript of the decision/order:

Reference numbers:
UPC_CoA_549/2024
APL_51838/2024
App_53031/2024

Order
of the Court of Appeal of the Unified Patent Court
of 29 October 2024
concerning an application for suspensive effect

HEADNOTES:
1. Pursuant to R.223.2 RoP, the Application for suspensive effect shall set out: (a) the reasons why the lodging of the appeal shall have suspensive effect and (b) the facts, evidence and arguments relied on. This means that such an application must in and of itself enable the Respondent to prepare its position and must enable the Court of Appeal to decide on this application, if necessary without further information. References to pleadings and documents in the files at first instance are admissible, provided that the text passages referred to are sufficiently specific.
2. Suspensive effect may be ordered if the order against which the appeal is directed is manifestly erroneous. Whether there is a manifest error is assessed on the basis of the factual findings and legal considerations that underpin the order or decision at first instance. If these findings or legal considerations already prove to be flawed in the summary examination that is to be carried out, suspensive effect must generally be ordered. As a rule, this applies regardless of whether the impugned order or decision may prove to be correct with other findings or on the basis of other legal considerations.
3. A director of a patent-infringing company represents that company. That company cannot therefore be a “third party” in relation to this director within the meaning of Art. 63 UPCA and Art. 11 of Directive 2004/48. Therefore, pursuant to Art. 63 para. 1 sentence 2 UPCA, liability as an intermediary cannot arise solely from a person’s role as a director of a patent-infringing company.
4. Pursuant to R.352.1 RoP, the rendering of a security must be ordered when the decision or order is issued.

KEYWORDS:
- Application for suspensive effect
- Intermediary
- Order to provide security

APPELLANTS AND APPLICANTS / DEFENDANTS IN THE MAIN PROCEEDINGS BEFORE THE COURT OF FIRST INSTANCE
1. Aschheim, Germany,
2. Belkin GmbH, Aschheim, Germany,
3. Belkin International Inc., El Segundo, California, United States of America,
4. Belkin Limited, Wellingborough, Northamptonshire, United Kingdom,
5. Wellingborough, Northamptonshire, United Kingdom,
6. Wellingborough, Northamptonshire, United Kingdom,
(hereinafter for all in the singular: ‘Belkin’, for Defendants 1, 5, 6 hereinafter: ‘Defendant Directors’,
for Defendants 2 to 4 hereinafter: ‘Defendant Companies’)
represented by: Attorney-at-law Dr. Philipp Cepl, Attorney-at-law Dr. Constanze Krenz, Attorney-at-law Dr.
Benedikt Hammerschmid, Attorney-at-law Julia Ortel, Attorney-at-law Dr. Joschua Fiedler und Attorney-at-law
Dr. Carl Prior, DLA PIPER UK LLP Rechtsanwälte, Munich

RESPONDENT / CLAIMANT IN THE MAIN PROCEEDINGS BEFORE THE COURT OF FIRST INSTANCE
Koninklijke Philips N.V.
(hereinafter ‘Philips’)
represented by: Attorney-at-law Dr. Tilmann Müller, Bardehle Pagenberg, Hamburg

LANGUAGE OF PROCEEDINGS
German

PANEL AND DECIDING JUDGES
Panel 2,
Rian Kalden, legally qualified judge and presiding judge,
Ingeborg Simonsson, legally qualified judge,
Patricia Rombach, legally qualified judge and judge-rapporteur
Alain Dumont, technically qualified judge
Uwe Schwengelbeck, technically qualified judge

IMPUGNED DECISION OF THE COURT OF FIRST INSTANCE
□Date: 13 September 2024
□Reference numbers of the Court of First Instance: ORD_598464/2023, ACT_583273/2023,
UPC_CFI_390/2023

PATENT AT ISSUE
EP 2 867 997

FACTS AND REQUESTS OF THE PARTIES
1. The Respondent (hereinafter “Philips”) is bringing an action against Belkin for infringement of the
European patent EP 2 867 997 (patent at issue) seeking injunctive relief, recall, disclosure of
information, damages, and publication of the judgment.
2. Defendants 2 to 4 are companies of the Belkin group. Defendant 1 is the director of Defendant 2 and
the director of Defendant 4. Defendants 5 and 6 are directors of Defendant 4.
3. Defendant 2 filed an action for revocation of the patent at issue with the German Federal Patent
Court on 10 March 2022. The action for revocation was rejected by (not-legally binding) judgment
on 12 July 2024.
4. On 10 August 2019, Philips brought an action with the Düsseldorf Regional Court against Defendants
2 and 4 for infringement of the German part of the patent at issue. By judgment dated 20 March
2023 (Case No. 4a O 49/22), the Düsseldorf Regional Court rejected the action. The Higher Regional
Court (Oberlandesgericht) of Düsseldorf dismissed the appeal against this judgment as inadmissible
on 18 April 2024.
5. Philips, in its request A.1 of the action requested before the Local Division (with respect to
Defendants 2 and 4, subject to the limitation specified in request G that its actions within the territory
of the Federal Republic of Germany are excluded), that the Defendants be ordered to refrain from
offering, placing on the market, using, or importing or possessing for the aforementioned purposes
the power transmitters specified in greater detail in the request for a system of inductive power
transfer in the Federal Republic of Germany, Belgium, France, Finland, Italy, the Netherlands, Austria,
and Sweden, provided that the power transmitter for inductive power transfer uses chips other than
those manufactured and/or sold by or its affiliated companies.
6. At the oral hearing before the Local Division, the presiding judge provided a preliminary assessment
of the dispute regarding the interpretation and infringement of the patent at issue and further stated
as follows:
“Regarding the counterclaim for revocation, which is to be considered next, we would focus on the
discussion of the argument concerning added matter. The other arguments, such as lack of novelty,
inventive step, etc., have already looked at by us, but we currently do not see any need for further
discussion” (around minute 14:25 of the first audio recording).
In the further course of the hearing (at approximately minute 2:37 of the third audio recording),
Belkin’s representative posed the following question:
“ Mr. presiding judge, excuse me, may I ask a follow-up question regarding validity? Because the fact
is that both the Federal Patent Court and our submission are based on a narrower interpretation,
and the reference is also based on the interpretation of the Regional Court, and D6 was not the
subject of the reference. I understand you correctly, however, that you do not wish to discuss in the
hearing the prior art that was not the subject of the reference.”
7. The presiding judge replied: “We will then subject that to an assessment, yes.”
8. The Munich Local Division, in its decision on the merits of 13 September 2024, granted the claims against the Defendant Companies concerning injunctive relief, disclosure of information, damages, and publication of the judgment (the latter with the stipulation that the General Data Protection Regulation must be observed).
9. The Local Division, in accordance with Item D, ordered the Defendant Directors
“to refrain from exercising their duties as director of Defendants 2 and 4 in such a way that the actions listed under B.I (Note: B.I describes the actions prohibited for the Defendant Companies) are carried out by Defendants 2 and 4 outside the territory of the Federal Republic of Germany.”
10. Apart from that, the Local Division rejected the action. Belkin’s applications to stay the proceedings and their counterclaims for revocation of the patent at issue were rejected.
11. Belkin is appealing the decision in its unfavourable parts.
Parties’ requests
12. Belkin requests
the Court to order suspensive effect of the appeal dated 20 September 2024, action number 51838/2024, against the decision of the Munich Local Division dated 13 September 2024, action number UPC_CFI_390/2023, ACT_583273/2023, ORD_598464/2023 pursuant to Art. 74 UPCA and Rule 223 RoP, specifically concerning items B.I, B.II, B.III, and/or item D of the operative part. It is further requested that, to the extent the application cannot be fully granted, the suspensive effect be ordered in relation to one or more of these items.
In the alternative:
to suspend the enforcement of the decision of the Munich Local Division dated 13 September 2024, action number UPC_CFI_390/2023, ACT_583273/2023, ORD_598464/2023, pursuant to Rule 352 RoP, against the provision of security, with the amount of the security to be determined at the discretion of the Court.
In the further alternative:
to permit the enforcement of the decision of the Munich Local Division of 13 September 2024, action number CFI_390/2023, ACT_583273/2023, ORD_598464/2023, pursuant to Rule 352 RoP, only against the provision of security in the amount of at least EUR 6,000,000.
13. Philips requests that the applications be denied.
SUBMISSIONS OF THE PARTIES:
Belkin essentially submits the following, in summary:
14. The Munich Local Division, with the impugned decision, has severely violated Belkin’s fundamental procedural rights.
15. The Local Division violated the principle of orality and the right to be heard, and thereby the right to a fair trial, as Belkin was not at any point in the oral hearing permitted to comment on the prior art and on the issues of novelty and inventive step. Belkin’s representative would not have explicitly sought clarification if she had not intended to discuss the prior art. This inquiry should be regarded as a request to hold discussions on the prior art. The presiding judge had already made up his mind before the question arose: “We do not currently consider it necessary to repeat in detail during the public hearing any validity arguments that have already been submitted in writing”. Against this background, demanding that the word “request” be used is mere formalism, particularly since it is not the responsibility of the parties to formally “request” an oral hearing on evidently significant core issues of patent validity, such as the prior art.
16. The simple remark by the presiding judge that the prior art “is not convincing” deprived Belkin of any opportunity to adequately address the panel´s concerns, as it had not been specified where the problems were perceived.
17. It is unacceptable that the Local Division interpreted the qualified indication from the Federal Patent Court regarding the issue of patentability as binding, yet did not acknowledge a similar binding effect for the interpretation underlying this indication, which would have inevitably led to a finding of non-infringement. At the very least, the Court should have specified during its introduction which features in the prior art were considered not disclosed. This applies particularly to D6 and D7, which had not even been assessed by the Federal Patent Court at the time of the oral hearing.
18. In particular, there is a complete lack of any indication regarding D7 that the introduction of new prior art would be considered an amendment to the action under R. 263 RoP, which is why Belkin was also unable to make any further submissions on this matter.
19. Furthermore, the grounds for the decision reveal that the ruling on the validity of the patent does not, at least in part, rely on the division’s own assessment. The statements regarding the original disclosure and feasibility were taken verbatim from the judgment of the Federal Patent Court without this being made apparent. It cannot be ruled out that the Local Division might have reached a different decision had it independently assessed the validity of the patent.
20. The Local Division did not rule on several of Belkin’s applications in its decision.
21. The Local Division dismissed Belkin’s submissions as an amendment to the case but, at the same time - despite Belkin’s repeated objections regarding late submissions - took into account Philips’ decisive submissions concerning acts of use outside Germany, which were only presented in the Reply. These submissions, by the standards applied to Belkin’s submissions, should not have been admissible. The judgment is therefore not only obviously incomplete, as Belkin’s objection to the late submissions was not addressed, but the omission also results in an irreconcilable contradiction, as the introduction of new submissions was assessed differently.
22. The operative part of the contested decision is, insofar as it concerns the Defendant Directors, vague and therefore not enforceable.
23. Furthermore, the decision concerning the liability of the Defendant Directors goes beyond the applications made by Philips and violates Art. 76(1) UPCA. The Court held the Defendant Directors liable as “intermediaries” within the meaning of Art. 63(1), sentence 2, UPCA, without a corresponding application from Philips. Liability as an intermediary does not constitute a more limited claim (“Minus”), but rather constitutes another cause of action and thus something else (an “aliud”) compared to the liability sought by Philips under Art. 63(1), sentence 1, UPCA.
24. In this respect, the decision is also manifestly erroneous. The Defendant Directors cannot qualify as intermediaries under Art. 63(1), second sentence, UPCA, because the company cannot be considered to be a third party in relation to its director within the meaning of this Article.
25. The contested decision is contrary to fundamental principles of European law and disregards the scope of the res judicata of the Regional Court of Düsseldorf’s judgment concerning Defendant 3. The question arises as to how far the res judicata effect applies under Art. 36 of the Brussels I Regulation. It is undisputed that the present proceedings involve the same contested embodiments, the same patent at issue, and the same method of distribution via the website www.belkin.com/de, which was already the subject of the German proceedings. The Local Division based Defendant 3’s liability solely on the fact that this party was the domain owner and was mentioned in the website’s terms and conditions. Since the Court of Justice of the European Union recently ruled that the provisions of the Brussels I Regulation must not be interpreted restrictively (judgment of 8 June 2023 - Case C-567/21), a clarification by that court would have been necessary to determine whether the narrow interpretation of Article 36 of the Brussel I Regulation is consistent with European law. In any case, regarding the issue of stay of the proceedings, the Court of Appeal adopted a broad interpretation (CoA, procedural order of 17 September 2024, UPC_CoA_227/2024).
26. The Local Division did not justify "its application" of Article 36 of the Brussels I Regulation and did not rule on the application.
27. It is unclear what the Local Division's remark on page 18 of the grounds for the decision refers to, stating that Belkin had not asserted the res judicata of the Higher Regional Court's judgment beyond Article 36 of the Brussels I Regulation. Aside from the fact that the claim is incorrect, the Local Division was obligated to consider the conflicting res judicata effect of other decisions of its own motion, which it evidently failed to do.
28. Moreover, the Local Division infringed the primacy of European Union law with the contested decision when it states that a stay under Article 30 of the Brussels I Regulation is not warranted because Article 34 UPCA grants the UPC exclusive jurisdiction.
29. The Federal Patent Court, in its decision in the German revocation proceedings, adopted an interpretation of the patent under which an infringement would be ruled out, thereby creating a significant likelihood that the judgment will be overturned in an appeal.
30. The Local Division did not conduct an interim conference at any point. No case management order was issued during the interim proceedings. In particular, Belkin was not informed until the oral hearing that the Division did not have the intention to deliberate on the prior art or that parts of the submissions could be dismissed as late.
31. The balance of interests also favours Belkin and the requested order for suspensive effect. Philips is primarily pursuing a monetary interest, which can be compensated regardless of the outcome of the appeal proceedings, and is, in any case, obligated to grant a license due to the IPC Policy of the standard-setting organization (WPC) underlying the Qi standard. In contrast, Belkin would suffer irreparable harm from enforcement. In particular, enforcement against the Defendant Directors could place them in a situation threatening their livelihoods, especially if it were required (which remains unclear) that they could no longer hold their office.
32. In any case, any potential interest of Philips was sufficiently addressed by Belkin’s power to avert enforcement.
33. However, in any event, enforcement of the judgment must be preceded by a substantial security deposit.
Philips essentially submits the following in summary:
34. As is evident from the interplay of the provisions on the right to be heard, the principle of orality, and case management powers, the UPC system does not require that the parties provide a comprehensive statement on the facts of the case during the oral hearing in order to issue a decision on the merits.
35. The principle of the right to be heard does not establish a right for the parties to have the court’s legal opinion disclosed before the decision, nor for the parties to be given the opportunity to comment on it. An exception may apply only if the court bases its decision on a legal point that even a conscientious and knowledgeable party to the proceedings could not have been expected to anticipate, even considering the range of reasonable legal interpretations.
36. The Local Division had prioritised the matter in its introduction, which, moreover, was only provisional. It did not indicate any intention to reject any further submissions. Belkin also did not request permission to make oral submissions on any additional aspects.
37. In his introduction, the presiding judge explicitly pointed out that the submission of prior art documents D7 and D8 in relation to the main application had been made late, and that Belkin had not explained why these documents had not been submitted earlier. Philips also objected to the delay in its rejoinder to the counterclaim for revocation dated 11 April 2024 (see pp. 10 ff. therein). Belkin also had the opportunity to make submissions regarding the requirements of Rule 263 RoP and did so in its rejoinder to the application to amend the patent dated 13 May 2024.
38. Belkin’s objection that all submissions extending beyond Germany were late was implicitly dismissed by the Local Division, as the decision on the merits referenced the relevant submissions. In this respect, the situation is entirely different from the case of D7.
39. The operative part of the judgment was also sufficiently specific with regard to the Defendant Directors. Compliance with the cease-and-desist order was also possible for them.
40. Moreover, the defence of impossibility would remain available to Belkin within the framework of enforcement proceedings, even without the need for suspensive effect.
41. The Local Division did not award more than what was requested. The application implicitly includes, as a lesser element, an application to issue an order against the Defendant Directors prohibiting them from continuing to perform their duties as directors of the Defendant Companies in such a way that would enable a continuation of the infringement.
42. The liability of the Defendant Directors as intermediaries does not, contrary to Belkin's view, constitute a different subject matter from the requested action. There is no divergence regarding the facts, as they are linked to the same actual conduct by Belkin, namely the patent infringement.
43. In this respect, there is also no evident error in the judgment. Contrary to Belkin’s opinion, the services of the directors, within the meaning of Article 63(1), sentence 2, UPCA, are being used by the company "to infringe a patent." This is because the instructions issued by the directors of a company to their subordinate employees constitute the very basis for the company's ability to commit patent infringement.
44. As the Local Division correctly determined, recognition of the judgment of the Higher Regional Court of Düsseldorf with respect to Defendant 3 is not applicable. The liability of Defendant 3 constitutes a liability that is independent of the liability of Defendants 2 and 4. This represents a significant difference from the liability of the Defendant Directors, as assumed by the Local Division, as intermediaries of Defendants 2 and
45. There is no violation of the right to be heard regarding Belkin’s request for a referral to the Court of Justice of the European Union. Belkin only submitted this request as a subsidiary measure, in the event that the court did not recognize the judgment of the Higher Regional Court of Düsseldorf. The Local Division, however, did recognize the judgment concerning the Defendant Directors. The fact that recognition was not granted with regard to the liability of Defendant 3 is irrelevant, as Belkin's referral application pertained to the liability of the Defendant Directors.
46. It should also be noted that the decision on whether to refer the matter to the Court of Justice of the European Union is at the discretion of the Local Division, pursuant to R.266.1 RoP, Art. 21 UPCA in conjunction with Art. 267 TFEU. The Local Division exercised its discretion without erring in law.
47. An argument against a referral in the present case is the acte clair doctrine, as there cannot reasonably be any doubts regarding the interpretation of the concept of res judicata and thus the recognition of decisions under Article 36 of the Brussels I Regulation. According to the EU law concept of res judicata, not only the operative part of the decision but also the reasoning supporting it are taken into account (CJEU, judgment of 15 November 2012, C-456/11, para. 40). Neither the judgment of the Düsseldorf Regional Court nor that of the Düsseldorf Higher Regional Court contained any findings regarding the infringing actions of Defendant 3.
48. The Local Division exercised its discretion regarding the stay of the proceedings under Art. 30(1) of the Brussels I Regulation (recast) without erring in law. In doing so, the Local Division did not merely rely on a reference to Art. 34 UPCA and the exclusive jurisdiction of the UPC. Rather, it emphasized that the German revocation proceedings only concern the German part of the patent at issue, while this case also involves the infringement and validity of the Belgian, French, Finnish, Italian, Dutch, Austrian, and Swedish parts of the patent at issue. This marks a distinction from the decision of the Court of Appeal dated 17 September 2024 (UPC_COA_227/2024). In that case, the proceedings were suspended primarily because both appeal procedures concerned only the German part of the European patent. Thus, the subject matter of the litigation was almost identical, unlike in the present case.
49. Moreover, different auxiliary requests were submitted in the present proceedings and the German revocation proceedings. This further confirms that the subject matter of the disputes is not almost identical and that stay of the proceedings is not warranted.
50. Furthermore, Philips has a "particular interest" in the decision on the counterclaims for infringement and revocation, as claims for damages have been asserted.
51. It should also be taken into account that there is no risk of conflicting decisions in this case. This is because both the Federal Patent Court and the Local Division confirmed the validity of the patent at issue at first instance.
52. Finally, it is to be assumed that the Court of Appeal in the present proceedings will reach its decision more quickly than the Federal Court of Justice in the parallel German revocation proceedings, making a stay of the present legal dispute unwarranted for reasons of procedural efficiency.
53. Belkin has neither quantified specific damages nor demonstrated concrete enforcement disadvantages that could not be remedied even if the appeal were successful.
54. Belkin’s application for the suspension of enforcement against provision of security has no legal basis. As an exceptional provision, Rule 352 RoP must be interpreted narrowly. In any case, the application is untimely.
55. Therefore, the application for the imposition of an enforcement security under Rule 352.1 RoP is also untimely. No reasons for excusing the delay have been presented or are apparent. The application is also clearly unfounded, as no specific enforcement damages have been asserted.

GROUNDS FOR THE ORDER
A. Main request
I. Admissibility of the Application for suspensive effect
56. The Application for suspensive effect is admissible, and in particular admissible pursuant to Art. 74 UPCA and R.223.1 RoP.
II. Merits of the Application for suspensive effect with regard to the Defendant Directors
57. The Application for the appeal to have suspensive effect is successful insofar as it concerns the enforcement against the Defendant Directors. In all other respects, the application must be dismissed.
1. Conditions for ordering suspensive effect
58. Pursuant to Art. 74 para. 1 UPCA, an appeal has no suspensive effect unless the Court of Appeal decides otherwise at the motivated request of one of the parties. The Court of Appeal can therefore grant the application only if the circumstances of the case justify an exception to the principle that the appeal has no suspensive effect. In that context, it must be examined whether the appellant's interest in maintaining the status quo until the decision on its appeal exceptionally outweighs the respondent's interest (UPC Court of Appeal, Order of 18 January 2024, UPC_CoA_4/2024, App_100/2024 p. 5; Order of 19 June 2024, UPC_CoA_301/2024, App_35055/2024, para. 7; Order of 19 August 2024, UPC_CoA_388/2024, APL_39884/2024, para. 6).
59. In particular, suspensive effect may be ordered if the order against which the appeal is directed is manifestly erroneous (UPC Court of Appeal, Order of 18 January 2024, UPC_CoA_4/2024, App_100/2024 p. 5; Order of 19 August 2024, UPC_CoA_388/2024, APL_39884/2024, para. 7) or if the enforcement of the impugned decision would make the Appeal largely devoid of purpose (UPC Court of Appeal, Order of 6 November 2023, UPC_CoA_407/2023, App_584588/2023; Order of 2 May 2024, UPC_CoA_177/2024, APL_20002/2024 para. 10).
60. Whether there is a manifest error is assessed on the basis of the factual findings and legal considerations that underpin the order or decision at first instance. If these findings or legal considerations already prove to be flawed in the summary examination that is to be carried out, suspensive effect must generally be ordered. As a rule, this applies regardless of whether the impugned order or decision may prove to be correct with other findings or on the basis of other legal considerations.
61. Furthermore, the violation of fundamental procedural rights, such as the principle of the right to be heard, may also justify the ordering of suspensive effect if it cannot be ruled out from the outset that the court would have come to a different conclusion without the violation.
62. Pursuant to R.223.2 RoP, the Application for suspensive effect shall set out: (a) the reasons why the lodging of the appeal shall have suspensive effect, and (b) the facts, evidence and arguments relied on. This means that such an application must in and of itself enable the Court of Appeal to decide on this application, if necessary without further information. References to text passages in pleadings and documents in the files at first instance are admissible, provided they are sufficiently specific.
2. Ruling on the Defendant Directors
63. With these principles in mind, suspensive effect must be ordered insofar as the Defendant Directors have been ordered to carry out their duties as directors of the Defendant Companies in such a way that the Defendant Companies do not carry out the prohibited activities outside the territory of the Federal Republic of Germany (operative part D, hereinafter: the injunction). The same applies to the decision on costs and the permission to publish the decision at the Defendant Directors’ expense.
a) Manifest error of law
64. In the impugned decision, the Local Division justified this injunction with regard to the Defendant Directors as follows. For Defendant 1, the Claimant had not demonstrated its own acts of use within the meaning of the case law of the CJEU. Defendant 1 had neither acted as a seller of his own products nor had he given the impression during trading that he was the person marketing the products at issue in his own name and for his own account. However, Defendant 1 could be held liable as an intermediary pursuant to Art. 63 (1) sentence 2 UPCA since, due to his function as director of Defendant 2 and director of Defendant 4, he had the opportunity to influence their outcomes. As a director, he had provided services in relation to Defendants 2 and 4 which had been used by them to infringe the patent in suit. As a director, he could also influence the infringement by issuing corresponding instructions to his subordinate employees. The Local Division employed similar reasoning in the cases of the other Defendant Directors.
65. Belkin rightly criticises this as a manifest error of law. There is no reasonable doubt that directors of a company cannot be held liable as intermediaries within the meaning of Article 63(1) sentence 2 UPCA solely on the basis of their function as directors.
66. A director of a patent-infringing company represents that company. That company cannot therefore be a “third party” in relation to this director within the meaning of Art. 63 UPCA and Art. 11 of Directive 2004/48. Therefore, pursuant to Art. 63 para. 1 sentence 2 UPCA, liability as an intermediary cannot arise solely from a person’s role as a director of a patent infringing company.
b) Weighing of interests
67. In view of the manifest error of law, the Defendant Directors' interest in maintaining the status quo prior to the decision pending the outcome of the appeal proceedings outweighs Philips' interest in enforcement.
68. The same applies insofar as the Defendant Directors were ordered to pay the costs of the litigation and insofar as Philips was authorised to publish the impugned decision in whole or in part in public media, in particular on the Internet, at their expense.
III. Order for suspensive effect in all other respects
69. Insofar as Belkin seeks an order granting the appeal suspensive effect in all other respects, the Application is unsuccessful.
70. In this respect, Belkin's submission does not indicate an infringement of fundamental procedural rights (in particular the right to be heard and the right to a fair trial) or a manifest error. In particular, it is not apparent from the submission that Belkin was prevented at the oral hearing from also making statements on novelty and inventive step within the time frame granted to Belkin (see R.113.1 RoP), the appropriateness of which was not disputed. In this respect, there is no need for a decision as to whether R.113.3 RoP would allow such a material restriction. Although Belkin asserts that no decision was issued regarding certain applications, these have been at least implicitly decided. Nor does the decision on the merits lack reasoning which would justify the granting of suspensive effect.
B. Auxiliary requests
71. The auxiliary requests are unsuccessful.
72. There is no need for a decision as to whether the Court of Appeal can also order suspensive effect as a milder measure under a resolutory or suspensive condition of security. This would only come into consideration if the circumstances of the case justified an exception to the principle that the appeal has no suspensive effect. Such circumstances are not present in this case, insofar as this is to be decided in the context of the auxiliary requests.
73. Although pursuant to R.352 RoP a decision or order may be subject to the rendering of a security by a party to the other party, the rendering of such a security must be ordered when the decision or order is issued. This follows from the wording of R.352.1 RoP, according to which a decision or order "may be subject to", as well as from the systematic position in Chapter 10 ("Decisions and Orders"). There is therefore no need to decide on whether R.352 RoP also provides for a power to avert [“Abwendungsbefugnis” which means that the defendant may avoid the enforcement by providing security of a certain amount – not in the original order].
C. Deciding judges
74. The judge-rapporteur has referred the decision to the panel for a decision in accordance with R.102.1 RoP.

ORDER:
I. The appeal against the decision on the merits of the Munich Local Division, issued on 13 September 2024 (ORD_598464/2023, ACT_583273/2023UPC_CFI_390/2023), is granted suspensive effect insofar as it allows enforcement against Defendants 1, 5 and 6.
II. The further requests are dismissed.

Issued on 29 October 2024

Rian Kalden, legally qualified judge and presiding judge,
Ingeborg Simonsson, legally qualified judge,
Patricia Rombach, legally qualified judge and judge-rapporteur,
Alain Dumont, technically qualified judge
Uwe Schwengelbeck, technically qualified judge

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