What are the so-called “other expenses”? CJEU ruling dispels doubts in this regard
In its judgment of 28 April 2022 (ref. C-559/20), the CJEU addressed the issue of legal costs in the context of other expenses referred to in Directive 2004/48/EC. Pursuant to Article 14 of that Directive, Member States are required to ensure that reasonable and proportionate legal costs and other expenses incurred by the successful party in an intellectual property case are borne by the unsuccessful party, unless justice does not allow it.
The preliminary question in Case C-559/20 was whether the costs of an attorney’s fees associated with a summons to an intellectual property infringer at the pre-litigation stage (the stage of attempting amicable settlement) fall within the concept of legal costs or other expenses.
The CJEU has held that “Directive 2004/48 applies to both judicial and non-judicial proceedings, since both may be necessary to ensure the enforcement of intellectual property rights”. Accordingly, calls for amicable (out-of-court) dispute resolution are covered by Directive 2004/48/EC.
Other expenses should furthermore be understood as expenses strictly and directly related to the proceedings in question. Thus, if a summons to the infringer is necessary to ensure the enforcement of intellectual property rights and it is intended to avoid or even replace court proceedings, the costs associated with the summons are recoverable.
Pursuing liability for infringement of intellectual property rights often involves significant costs. Entitled persons should not find themselves bearing additional costs related to the protection of their rights infringed by the infringer. The ruling in case No. C-559/20 determines that also the stage of attempted amicable settlement of a dispute is covered by the obligation to reimburse costs. It is worthwhile for the entitled parties to raise this argument in their pleadings when claiming reimbursement of costs related to summonses and legal services at this stage of the proceedings.
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