The continuing impact of Brexit on IP disputes was evident in a June 2024 design case decided by Mr Justice Zacaroli in the English High Court.
Zacaroli J’s judgment in Praesidiad Holding BVBA & Anor v Zaun Ltd concerned a registered Community design (RCD) for fence posts owned by Praesidiad (formerly Betafence).
UK and EU design invalidity proceedings
The litigation began when Betafence began infringement proceedings against Zaun in the UK in 2018. In response, Zaun sought a declaration of invalidity at the EU Intellectual Property Office (EUIPO). The High Court, as a Community design court, was therefore required to stay the action.
The EUIPO invalidity action was finally dismissed in June 2023 following a decision of the EU General Court, meaning the validity of the RCD was upheld.
In August 2023, Zaun filed a counterclaim in the High Court action seeking a declaration that the RCD and the re-registered UK design were invalid. Betafence applied to strike out Zaun’s counterclaim, saying it was an attempt to re-run the EUIPO invalidity challenge. In his judgment, Mr Justice Zacaroli agreed with Betafence.
Final determination
The judge said that Article 86(5) of the RCD Regulation prohibits a counterclaim for a declaration of invalidity once an Office has finally determined the matter between the same parties.
As the proceedings were instituted before the end of the Brexit transition period (31 January 2020), Article 67 of the Withdrawal Agreement was relevant. This states that the provisions of the RCD Regulation continue to apply.
Moreover, said Zacaroli J, Article 86(5) is a provision regarding jurisdiction and has not been disapplied by paragraph 9(2) of Schedule 1A to the Registered Designs Act 1949.
Res judicata
In any event, Zacaroli J concluded that Zaun was precluded by the common law principle of res judicata from re-litigating the question of invalidity of either the RCD or the re-registered (UK) design.
Crucially, he found that EUIPO was a “court of competent jurisdiction” and Article 86(5) applies a statutory form of res judicata throughout the EU. He said:
“It would in my judgment take more than an implied disapplication of the particular form of statutory res judicata in Article 86(5) to justify the conclusion that it was parliament's intention to disapply the well-established principles of res judicata and abuse of process.”
He also said that:
“a declaration of invalidity in proceedings before the EUIPO (in pending proceedings as at IP Completion Day) in respect of a registered community design must be reflected in a declaration of invalidity of the re-registered design which derives from the registered community design.”
Even if that were not true, a counterclaim for a declaration of invalidity in respect of a re-registered design is res judicata where the same issue of invalidity has been litigated to a final conclusion in respect of the related RCD.
What does this mean?
This case shows that, eight years after the UK voted to leave the EU, Brexit continues to throw up new issues relating to IP protection and jurisdiction.
Given that trade mark and design proceedings that include appeals to the EU General Court (and EU Court of Justice) can take many years to resolve, it is likely that there are other cases initiated before the end of the transition period that are still pending.
This judgment therefore provides useful guidance on how the UK courts will approach trade mark and design cases with parallel actions before the EUIPO.
To find out more about the issues raised in this blog contact Rosie Burbidge, Intellectual Property Partner at Gunnercooke LLP in London - rosie.burbidge@gunnercooke.com