Domestic Courts and "Foreign" Infringement: What is the Law?- I

I am happy to bring these series of guest posts from Mihir Naniwadekar, a good friend of mine whose mind I have immense regard for. Mihir passed out of National Law School, Bangalore last year and has been practicing before the Bombay High Court. 

Mihir is a prolific blogger himself who, besides running his own blog, is also a contributor to the Indian Corporate Law blog. Without much ado, here are Mihir’s thoughts on a domestic court’s power to exercise its jurisdiction over a person resident within its territory for acts of infringement committed in a foreign land.

Domestic Courts and "Foreign" Infringement: What is the Law? 

Does a domestic Court have the jurisdiction to enforce a foreign copyright on the basis of in personam jurisdiction over the alleged infringer? This seemingly straightforward question was at the heart of the matter in a recent decision of the United Kingdom Supreme Court in Lucasfilm v. Ainsworth [2011]UKSC 39.

The case also involved intricate issues over the interpretation of UK statutes; this series of posts, however, discusses only the private international law issue.

The issue was this: “whether the English court may exercise jurisdiction in a claim against persons domiciled in England for infringement of copyright committed outside the European Union in breach of the copyright law of that country?” The Court of Appeal had held that foreign copyrights are not justiciable in an English court, on account of the Mocambique principle.

By way of some background, it will be useful to note that the Mocambique rule was one which developed in the context of land (thus, in a sense, Lucasfilm involved intricate questions over how far intellectual property is similar to other (real) types of property). The Mocambique rule refers to the rule in British South Africa Co v Companhia de Mocambique [1893] AC 602.

In the words of Dicey & Morris (Rule 39, 1^st edition, 1896), this case was cited as the main authority for the proposition that an English Court “has no jurisdiction to entertain an action for (1) the determination of the title to, or the right to the possession of, any immovable situate out of England … or (2) the recovery of damages for trespass to such immovable…”

Since then, the rule has been elevated to gospel – actions for enforcement of rights in relation to immovable property lie (subject to some exceptions) in the Court within whose jurisdiction the property is situated.

But, where is intellectual property situated? This question started troubling the Courts early in the 20^th century, and cases such as Potter v Broken Hill Pty Co Ltd [1905] VLR 612 appeared to extend the Mocambique rule to actions for infringement of patents. Potter was a case where the question of title was involved; however, in Hesperides Hotels Ltd v Aegean Turkish Holidays Ltd [1979] AC 508, the Mocambique rule was applied in where no question of title to the property was involved.

Lord Wilberforce’s judgment in Hesperides effectively stated that it was for Parliament to change the law. This, Parliament did promptly: Section 30(1) of the Civil Jurisdiction and Judgments Act 1982 confirmed the jurisdiction of English Courts to entertain suits in relation to property outside England, “unless the proceedings are principally concerned with a question of the title to, or the right to possession of, that property.”

How far these Hesperides developments applied to intellectual property remained controversial, however, for Section 30(1) expressly dealt only with immovable property. By the early 1990s, the cases seemed to suggest that it was not possible to bring an action in England for enforcement of a foreign copyright.

For instance, Dicey & Morris stated in their 12^th edition, “Nor can the holder of a French patent, trade mark or copyright sue in England for its infringement in France. Since the French patent, trade mark or copyright is territorial in its operation… the act complained of would not be a tort if committed in England…”

This was confirmed in Tyburn Productions Ltd v Conan Doyle [1991] Ch 75, where it was held that it was not possible to sue in England for infringement of United States copyright. Now, it can be seen that the basis of the statement in Dicey & Morris (12^th edition) is that “the act complained of would not be a tort in England…”

This implies that in such cases, the proper law is the law of England, and not the law of the place of infringement. This was changed by the Private International Law (Miscellaneous Provisions) Act, 1995. In principle, the law of the place of infringement would be the applicable law. Despite this, in Coin Controls Ltd v Suzo International (UK) Ltd [1999] Ch 33, Laddie J. held that “the court had no jurisdiction to try claims for infringement of German and Spanish patents…”

One reason for this view is that a patent involves the grant of a right dependant on the grant of authority by a State. In such a case, a foreign Court examining the validity of the patent (as opposed to merely determining issues of infringement) would amount to an examination of the sovereign acts of a foreign state.

This would, perhaps, be seen as militating against the comity of nations, a principle of some importance in private international law.

Given this background, the next post will examine the decision of the Supreme Court in Lucasfilm.