Decision of the Supreme Court on recusal of a non-permanent judge

Case No. (not identified) ¦ Decision of 13 February 2013 (FPC, unpublished)
Case No. 4A_142/2013 ¦ Decision of 27 August 2013 (Supreme Court) ¦ “Ablehnungsbegehren”

For the sake of good order, please note that colleagues of the authors at Hepp Wenger Ryffel are advising and representing clients in the field of the subject matter at stake.

Expectedly, the ongoing legal disputes on coffee capsules have reached the FPC — and the Supreme Court. The following patents are in suit:

However, the present decision of the Supreme Court does not pertain to the merits of the case yet; it only clarifies a question of recusal of a member of the board of the FPC.

Linizo Lungo Capsule (© Nestlé Nespresso SA)
Linizo Lungo capsule (illustrative)
© Nestlé Nespresso SA

The potential appearance of bias of judges is undoubtedly a matter of an ongoing debate amongst practitioners. How comes, you ask? Well, the FPC has been set up with only two permanent judges which are supported by a pool of 36 non-permanent judges (11 with a background in law, 25 with a technical background). Most of the non-permanent judges are attorneys-at-law and patent attorneys, either in private practise or in industry. A non-permanent judge in one case may also act as representative / assisting in patent matters in other cases. Evidently, there are pros and cons of this setup: On the one hand, this makes a lot of technical and legal competence available for the FPC to recruit for a specific case. Mostly, the FPC is thus in a position to handle cases without costly and time-consuming court opinions to be obtained from external experts. On the other hand, it is an intrinsic risk that judges might need to recuse in view of a conflict of interests. Of course, it must not be forgotten that the judges have sworn an oath (or taken a vow) pertaining to fulfilling their duties conscientiously; cf. Art. 15 PatCA. Nevertheless, it was only a matter of time that case-law would figure out the boundaries.

1.  Factual situation

In the present matter, the parties had already been summoned to an oral hearing when they were informed by the president that TSWpat, i.e. the firm of the non-permanent judge Peter RIGLING who was appointed reporting judge in the present matter, meanwhile represents a sister company of one of the defendants in the prosecution of a single trademark application in Switzerland. The president of the FPC had informed the parties that this did not constitute a ground of recusal in the sense of Art. 3 or 4 of the Guidelines on Independence. However, the plaintiffs requested that judge Peter RIGLING shall recuse himself or shall be recused ex officio.

The relationship of parties and persons involved in the present matter is summarized in the following chart (and will become even clearer hereinbelow). The parties to the proceedings are boxed in red; connected undertakings to parties to the proceedings are boxed in green; click image to enlarge:

parties

2.  What was argued

Judge Peter RIGLING outlined in writing, why — in his point of view — there was no reason for him to recuse. First, the affiliated (sister) company is not a party to the present proceedings. Moreover, the subject-matter of the present proceedings has no points of contact with the trademark prosecution handled by his firm. Finally, the trademark matter handled by his firm is not associated with significant income.

Defendants refrained from providing any comments.

Plaintiffs argued that defendant Denner belongs to the Migros group of companies, as well as the applicant of the trademark application handled by the firm of judge Peter RIGLING. Not only Denner, but also Migros sells coffee capsules which are compatible with Nespresso® machines. Consequently, the plaintiffs had sued Migros for patent infringement, too. These proceedings are also pending (no publications on this parallel case are available to date). In both cases, inter alia the interpretation and infringement of one and the same patent is at stake (EP 1 646 305 B1; cf. the EPO Patent Register and Swissreg for more details). To the extent of these similarities, the outcome of the present case will prejudice the proceedings against Migros, in the plaintiffs’ view.

Plaintiffs further argued that Migros is not only proprietor of Denner, but also handles Denner’s intellectual property matters, such as e.g. the administration of trademarks. Plaintiffs also presumed that a representative of Migros would have taken part in the oral hearing. At that time, the parties had already informed the FPC by Email about the persons attending the scheduled hearing, but the FPC did not share this information with the respective other parties.

3.  Decision of the FPC

By now, the decision of the FPC is not published. From citations contained in the (surprisingly unredacted) decision of the Supreme Court, the following conclusions can be drawn with respect to the reasoning of the underlying decision of the FPC.

The FPC relied on Art. 28 PatCA (considering it as lex specialis to Art. 47 CPC). According to this provision, a judge has to recuse in proceedings where a member of the judge’s law firm or patent law firm or employer represents one of the parties. This is not the case here, since Migros France is not a party to the present proceedings.  With reference to Art. 47 CPC, the FPC held that there are no special circumstances that might point to a potential bias of the objected judge. The whole setup of the FPC hinges on the assumption that the non-permanent judges are not led by considerations like those brought forward by the plaintiff; there is thus no room left for speculations in this respect.

Das System des Bundespatentgerichts […] stehe und falle mit der Annahme, dass die nebenamtlichen Richter sich nicht von solchen Überlegungen leiten liessen. Für Vermutungen in der von den Klägerinnen geäusserten Art bestehe deshalb kein Raum, […].

The FPC thus dismissed the plaintiffs’ request for recusal of judge Peter RIGLING.

4.  Decision of the Supreme Court

First, the Supreme Court emphasizes that any person whose case falls to be judicially decided has the right to have the case heard by a legally constituted, competent, independent and impartial court (Art. 30(1) Federal Constitution of the Swiss Confederation). This constitutional guarantee cannot justify a differentiation between permanent and non-permanent judges involved (r. 2.1.3).

An appearance of bias of a judge may not only arise when a judge represents or has recently represented a party to the proceedings, but also in case of representation of a counterparty of a party to the proceedings at stake (cf. BGE 135 I 14, r. 4.1-4.3, confirmed in BGE 138 I 406, r. 5.3-5.4; BGE 139 III 120, r. 3.2.1); see r. 2.1.4.

The same reasoning holds true when not the objected judge himself but rather a colleague of the same law firm is engaged in either one of the attorney-client relationships outlined above (cf. r. 2.1.5 with further reference to BGE 138 I 406, r. 5.3 and 4A_256/2010, r. 2.5).

The situation can get (and got here!) even more complicated when connected undertakings are involved. The Supreme Court explicitly holds that a schematic approach in the assessment of an appearance of bias is not applicable in such cases (r. 2.1.6).

Angesichts der Vielfalt möglicher Verbindungen zwischen verschiedenen Gesellschaften wäre ein streng schematisches Vorgehen verfehlt: Weder kann ohne Weiteres von der Befangenheit des nebenamtlichen Richters ausgegangen werden, wenn ein offenes Mandatsverhältnis zu einer mit der Prozesspartei irgendwie verbundenen Konzerngesellschaft besteht, noch wäre es im Hinblick auf den massgebenden Gesichtspunkt des Anscheins der Befangenheit bei objektiver Betrachtung angebracht, unbesehen der Konzernwirklichkeit ausschliesslich auf die rechtliche Unabhängigkeit der Verfahrenspartei abzustellen.

It rather depends on the actual circumstances. It needs to be individually assessed whether the indirect relationship (via a connected undertaking) is too close, i.e. comparable to a direct relationship:

Vielmehr ist unter Berücksichtigung der konkreten Umstände zu beurteilen, ob das offene Mandatsverhältnis zwischen dem nebenamtlichen Richter bzw. seiner Kanzlei und einer Konzerngesellschaft mit einer vergleichbaren Nähe zur mit dieser verbundenen Verfahrenspartei einhergeht.

In this respect, it is irrelevant whether such assessment is cumbersome or not.

Entgegen dem, was die Vorinstanz anzunehmen scheint, können praktische Schwierigkeiten bei der Beurteilung von Ausstandsgründen oder der damit verbundene Aufwand nicht dazu führen, bestimmte Beziehungen – wie etwa ein Mandatsverhältnis zu einer verbundenen Gesellschaft – bei der Beurteilung von Ausstandsgründen einfach auszublenden.

Moreover, the Supreme Court holds that Art. 28 PatCA is not a lex specialis to the CPC in a general sense. Art. 28 PatCA explicitly deals with the situation where a member of the judge’s law firm or patent law firm or employer represents one of the parties. This was not the case here. There is no room for an argumentum e contrario based on Art. 28 PatCA, i.e. that only the specific situation governed by Art. 28 PatCA might constitute a reason of recusal; cf. r. 2.2.

Finally, the Supreme Court states that the plaintiff had the right to consult the case files and to obtain copies thereof; cf. Art. 53(2) CPC. This also pertains to the Email communication prior to the scheduled hearing (cf. Section 2, above). Apparently, there is no conflict with overriding public or private interests. In the said Email, the head of the legal department of the Migros-Genossenschafts-Bund (MGB) was announced to be present at the hearing, with authorization of Denner AG. The Supreme Court thus holds that it was evident for the judges that Migros has an immediate interest in the outcome of the present proceedings. Consequently, it cannot be decisive whether Migros itself is formally party to the proceedings or not.

Aus dem fraglichen E-Mail vom 25. September 2012 geht hervor, dass auf Seiten der Beschwerdegegnerinnen die Leiterin Rechtsabteilung des Migros-Genossenschafts-Bunds an der vom Bundespatentgericht angesetzten Instruktionsverhandlung mit Vollmacht der Denner AG teilgenommen hätte. Der Migros-Genossenschafts-Bund ist demnach am Ausgang des vorliegenden Patentverletzungsverfahrens – für die Richter erkennbar – unmittelbar interessiert, womit es für die Beurteilung des Ausstandsbegehrens nicht darauf ankommen kann, ob er selbst oder seine Tochtergesellschaft Denner AG formell Verfahrenspartei ist.

Consequently, the Supreme Court approved the appeal and decided to recuse judge Peter RIGLING.

Reported by Martin WILMING and Thorsten MÜLL

BIBLIOGRAPHY

Case No. (not identified) ¦ Decision of 13 February 2013 (FPC, unpublished)
Case No. 4A_142/2013 ¦ Decision of 27 August 2013 (Supreme Court) ¦ “Ablehnungsbegehren”

(1.) Société des Produits Nestlé SA
(2.) Nestec SA
(3.) Nestlé Nespresso SA

./.

(1.) Denner AG
(2.) Alice Allison SA

Subject(s):

  • Patent infringement / Recusal

Composition of the Board of the FPC:

  • (not identified)

Representative(s) of Plaintiff:

Representative(s) of Defendant:

Dr. iur. Thierry CALAME (Lenz & Stähelin)

Full text of the decision of the Supreme Court right here:

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3 Replies to “Decision of the Supreme Court on recusal of a non-permanent judge”

  1. From the European Patent Register in the matter of EP 1 646 305 B1, it is evident that EP 1 757 212 B1, EP 2 103 236 B1 and EP 2 181 629 B1 are divisionals within the same patent family.

    From the online files, I note that the President of the FPC requested accelerated proceedings in view of infringement proceedings pending with the FPC (Case No. O2012_042). The acceleration request pertains to EP’236 (within the same patent family of EP’305 but not in suit here), EP’629 (within the same patent family but not in suit here, either) and EP 2 205 133 B1 of yet another patent family (not in suit here).

    EP 2 103 236 B1 was revoked by a BoA on October 10, 2013; cf. Tufty the Cat (with further reference).

  2. In Resolution Chemicals ./. Lundbeck in the U.K., the judge was faced with a request to recuse. Arnold J did not recuse. It’s interesting to read his reasoning.

    In sum, both the risk of subconscious bias and public perception of that risk is to be avoided, and the test is to be objective and assessed by the fair-minded and informed observer. Factors which that person would take into account include:

    (i) the overall context of the case – patents are a specialist area and many of the participants know each other;

    (ii) the nature and extent of the judge’s past association with […];

    (iii) the passage of time and the change in status of the judge and […]; and

    (iv) the judicial approach – English judges are equipped by their training and experience to identify and combat their own cognitive biases.

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