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28 May 2024FeaturesPatents ChannelDavid Fuentez Lahoz, Bird & Bird

A practical guide to protective letters in Spain

David Fuentes Lahoz of Bird & Bird explains how protective letters work in Spain and what parties need to know to use this anticipatory defence against potential ex parte preliminary injunctions.

What is a protective letter?

A protective letter is a brief of submissions filed by a party which has reasons to believe that a right holder might file with a court a request for an ex parte PI seeking the ban of the import, manufacture, commercialisation, implementation or possession for those effects of a device, product, service or method, that the right holder might believe to be infringing its IP rights.

The party filing the protective letter will develop arguments seeking to explain why its product, service, device or method does not infringe the IP right that might be asserted by the right holder; and/or challenge its validity/the entitlement or expose the procedural reasons—ie lack of urgency, lack of proportionality—that should lead to the dismissal of a prospective application for an ex parte PI.

Finally, the applicant of the protective letter should state its willingness to enter an immediate appearance with the court and attend an inter partes hearing in the event that the right holder files a request for a PI.

In short, the objective of the applicant of a protective letter is to convince the court that an application for a PI is not justified, would cause an irreparable harm to the applicant, and should be dismissed.

Can a protective letter be filed with respect to any IP right?

Protective letters were first admitted by the Decision of the Commercial Court of Barcelona No. 4 of January 18, 2013 (Celecoxib case) through the so-called voluntary jurisdiction (as a non-contentious matter), which was an innovative way to solve eventual procedural problems.

Finally, protective letters were implemented into Spanish law with the adoption of the Spanish Patents Act 24/2015, of July 24 (the SPA). In this sense, Article 132 of the SPA regulates protective letters for, specifically, patent-related matters.

Likewise, there is a Protocol on the Mobile World Congress Barcelona, approved by the Commercial Court of Barcelona and the European Union Trademark Court of Alicante, which expressly addresses protective letters as a procedural tool to be used in the framework of IP matters.

In addition, Spanish Courts have already admitted protective letters in IP matters outside the framework of the Mobile World Congress. In that regard, a protective letter can be filed with respect to any IP right, including copyright.

(See the Decision of the Commercial Court of Barcelona No. 8, of February 25, 2020—Pasapalabra case—and the Decision of the Commercial Court of Barcelona No. 6, of May 6, 2021—Sargadelos case, in which the company that filed a protective letter because it had reasons to believe that Sargadelos could file with a court a request for an ex parte PI was represented by Bird & Bird’s Spanish IP team) and acts of unfair competition (see the Decision of the Commercial Court of Barcelona, of March 29, 2023).

It is, moreover, widely considered that, under the principle of effective judicial protection and the principle of equivalence (Judgement of the Court of Justice of the European Union, of March 13, 2007, case C-432/05), protective letters can be admitted outside the patent field by analogy with the above-mentioned Article 132 of the SPA.

However, some Spanish decisions (eg the Decision of the Commercial Court of Madrid, of March 31, 2023) have rejected the analogical application of the SPA to unfair competition matters.

Where can a protective letter be filed?

The Spanish judiciary does not have a centralised register of protective letters. Protective letters can be filed with a competent court in Spain. Once the protective letter has been admitted and the court has rendered the order allowing the protection, the court will send a communication to the other Spanish competent courts in the field of IP to which the protective letter refers (patents, trademarks, etc) to inform them that a protective letter has been filed.

Subsequently, the applicant of the protective letter must notify the order to the IP right holder which will be required to mention the existence of that order if it decides to request a PI against the applicant of the protective letter. In other words, the IP right holder is not obliged to file the application for a PI with the same court that rendered the decision allowing the protective letter. Protective letters are exempt from court fees.

Once the protective letter is filed, it will be registered with a court reference number, the court shall order the initiation of a special procedure, it shall decide to grant the protection required by the protective letter, and it will notify the decision to the IP right holder (ie the potential applicant for a PI).

Only if the IP right holder enters a voluntary appearance in this procedure, some Spanish courts require serving a copy “as filed” of the protective letter and its annexed documents to the holder. In this context, note that, in any case, the potential applicant for a PI could request an inter partes PI under the already open proceedings.

Nonetheless, it should be noted that if the protective letter is filed after the application for a PI was already filed, the protective letter will not produce any legal effect since, as stated above, a protective letter is an anticipatory defence explaining why a potential ex parte PI would lack legal merit.

What types of preliminary injunctions are recognised in Spain?

A preliminary injunction (PI) is a provisional order rendered by a court, before, concurrently or after the proceedings on the merits are brought, to stop the defendant from initiating or continuing a particular behaviour, in order to preserve the factual status quo before a decision on the merits is rendered, either lifting the PI or turning it into a permanent injunction.

PIs are often requested by IP rights holders as a key step in their enforcement strategy.

In Spain, as a rule, applications for a PI are channelled through an inter partes hearing, where the defendant/alleged infringer has the right to use any means of evidence which he/she may deem pertinent either to deny the infringement or to challenge the validity of the asserted IP right. Exceptionally, a PI may be granted ex parte.

In an inter partes application for a PI, the corresponding court hears both sides’ submissions before deciding to grant or dismiss the application, while in an ex parte application for a PI, only the applicant is heard.

In this context, if the alleged infringer did not appear in an inter partes PI hearing, the hearing would therefore be similar in practice to the one that would have been held in case of an ex parte application for a PI. (See the Decision of the Commercial Court of Alicante No. 2 (ie the European Union Trademark Court of Alicante), of September 8, 2021 (Cintracar case), in which the applicant of the PI was represented by Bird & Bird’s Spanish IP team.)

A PI granted ex parte may be challenged by the defendant once it has been granted and enforced. Spanish courts can only grant ex parte PIs if the matter is urgent; therefore, the grant of ex parte orders is extremely exceptional—although not impossible—in Spain.

How to know as soon as possible if the holder has filed an application for a PI?

It is usual for the IP rights holder to first send a warning letter to the alleged infringer to inform of the situation and, if necessary, to reach a settlement agreement. In these cases, the risk of an application for a PI being filed will be higher.

In any event, when risks are present, recurrent monitoring of the court dockets by, for example, an authorised court agent could be highly recommended in order to know as soon as possible if the holder has filed an application for a PI.

What information should be included in a protective letter?

A protective letter should basically contain information and evidence that may lead the court to understand that there is a prima facie appearance that the holder may file an application for an ex parte PI.

A protective letter should also contain substantive and procedural reasons justifying non-infringement, lack of entitlement, invalidity, lack of urgency, proportionality and, in standard-essential patents cases, lack of essentiality.

In essence, the protective letter should contain a written statement of factual and legal allegations, with the main purpose of avoiding the admission of an ex parte PI, or with the subsidiary purpose of setting a date for an inter partes PI hearing to be held in the court.

Is there an expiry date for a protective letter?

According to Spanish case law (see, by way of example, Decision of the Commercial Court of Barcelona, of January 5, 2017) and Article 132 of the SPA, the main period of “validity” of a protective letter is three months, but it can be subject to further extensions for identical periods of three months.

Nevertheless, the efficacy of protective letters is generally limited to six months (ie Spanish courts usually admit just one extension for a period of three months, but additional extensions may be granted on a case-by-case basis). After that date, the protective letter is not likely to be justified for lack of urgency and, therefore, it shall expire, and consequently the proceedings shall be closed.

David Fuentes Lahoz is an associate in Bird & Bird’s IP team (Spain). For further information on this or related topics he can be contacted at: david.fuentes@twobirds.com.

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