Patent registered in France / Exclusive licensing agreement for France / Recourse to national courts for the ordering of provisional measures does not exclude arbitrators' jurisdiction / Jurisdiction of national courts over issuance and validity of patents does not waive arbitrators' jurisdiction over disputes concerning exploitation of patents

'The relations between the parties arise out of a contract signed in 1978 and a rider of 1984; both documents have been submitted to the Arbitral Tribunal.

. . .

The Contract is a typical exclusive patent licensing agreement. The patent holder is Claimant 1 and the licensee is the Defendant, who was given exclusive rights for France, while Claimant 2 finds itself in the same legal position as Defendant, being a company which received from the patent holder (Claimant 1) the exclusive right to market the goods in Germany.

. . .

Defendant claims that the Arbitral Tribunal is without jurisdiction, given that the dispute has already been submitted to national courts several times within the framework of "referee" proceedings.

These circumstances are not sufficient to deprive the arbitrators of jurisdiction. Article 8(5) of the Rules of Arbitration clearly states the principle (generally applied in international arbitration-Geneva Convention of April 21, 1961, art. VI - 4) according to which the intervention of a national court within the framework of provisional or emergency measures does not exclude the arbitrators from exercising their jurisdiction, to which, in fact Claimants have referred in the said court proceedings.

Defendant also asserts that the Arbitral Tribunal is without jurisdiction in the field of patents, a subject matter within the exclusive jurisdiction of the courts according to Article 68 of the French law on patents of January 2, 1968.

It should be specified that the present arbitral proceedings only relate to the parties' adherence to the provisions of the 1978 and 1984 agreements, as was agreed by the parties themselves in the Terms of Reference, and clearly flows from the claims submitted to the Arbitral Tribunal, referring on the one hand (for Claimants) to the termination of a contract for the exploitation of two French patents and, on the other hand (for Defendant), to the existence of a violation of the rights of exclusivity resulting from the contract.

Article 68, cited above, gives the national courts exclusive jurisdiction over disputes involving public policy, i.e., the issuance, cancellation, or validity of patents; yet it is nevertheless clear that disputes relating to the exploitation of a patent remain beyond doubt arbitral. All of the sources cited (both in case law and legal literature) by the parties (both Claimants and Defendant) agree on this and it therefore does not really seem tenable to insist that the Arbitral Tribunal lacks jurisdiction to rule or settle differences of a contractual nature.

The above comments are indirectly confirmed by Defendant. Defendant indicates that it has initiated an action before the Tribunal de Grande Instance in Marseilles, seeking the cancellation of the patents because of their lack of novelty, and thus asserting a claim that the contract of 1978 and its rider of 1984 are null and void. According to Defendant, there would thus be a parallel action pending in the national courts, in which case the Arbitral Tribunal can only decline to exercise its jurisdiction and order the parties to pursue the cancellation proceedings pending before the Tribunal de Grande Instance.

Alternatively, Defendant claims that the Arbitral Tribunal should at least postpone its decision until the Marseilles Tribunal de Grande Instance renders its judgment.

The Arbitral Tribunal, taking into consideration Article 100 of the French Code of Civil Procedure, decides that there are in fact no parallel proceedings in the two disputes, since they are not identical; while the parties, indeed, are the same, neither their interest in the case (causal pendent) nor the purpose of their claim (petite) are the same; there are thus not in this case two "equally competent jurisdictions" since, on the one hand, the Arbitral Tribunal could not rule on issues relating to the validity of patents and, on the other hand, national courts, because of the existence of an arbitration clause, would not have jurisdiction to deal with issues relating to the contract. Lastly, the exceptional nature of arbitral jurisdiction removes the possibility of such a situation of parallel proceedings existing between a national court and an arbitral panel.'