ECJ bans patents on transplantation of embryo cells, Brüstle, C-34/10

Professor Olivier Brüstle got the German patent related to neural precursor cells and the processes for their production from embryonic stem cells for therapeutic purposes, but was attacked by Greenpeace and finally lost proceedings before the Grand Chamber of the ECJ.

Professor Brüstle tried to argue that, in fact, he does not work with “embryo”, but the ECJ replied that “embryo” is an autonomous concept of the EU law and gave it the widest sense possible – thus, covering any human ovum after fertilisation, any non-fertilised human ovum into which the cell nucleus from a mature human cell has been transplanted and any non-fertilised human ovum whose division and further development have been stimulated by parthenogenesis (§§ 26, 38).

Professor Brüstle then argued that he does not use embryos for “industrial or commercial purposes” but for “purposes of scientific research” only. The ECJ replied that the word “patent” implies its industrial or commercial application (§§ 41-42). Therefore, according to the Grand Chamber, “industrial or commercial purposes” cover “scientific” ones (§ 46).

Thus, the transplantation of embryo cells became unpatentable.

ECtHR: contradictions between judgments of 2 national supreme courts must be tolerated, Şahin v Turkey, 13279/05

On 16/05/2011, a Turkish military plane crashed on return from an anti-terrorist operation in Iraq (§ 10). Families of 14 victims addressed the Ankara Administrative Court/Turkish Administrative Court and got pensions due to the death of relatives during an anti-terrorist operation (§ 64). However the Şahin family appeared before the 4th Chamber of the Ankara Administrative Court that found that the case shall be forwarded to the Turkish Supreme Military Administrative Court. The latter concluded that this was not a death during an anti-terrorist operation (§ 65). Yesterday, on 20/10/2011, the Grand Chamber of the ECtHR found on appeal that this case law contradiction must be tolerated, that it does not violate the right to fair trial.

The Şahin family tried to argue that this contradiction violates the principle of the consistency of the law, and the principle of legal certainty (§§ 40-41). The 10 v 7 ECtHR majority replied that this conflict of the Turkish Administrative Court and the Military Administrative Court must be tolerated, that it does not undermine legal certainty, that the principle of good administration of justice cannot impose a strict requirement of case law consistency, that one must respect the autonomy and independence of the 2 Turkish Courts, that it is not the ECtHR role to intervene simply due to a conflict of judgments (§§ 83-84, 88).

The minority of 7 judges held that the conflict of judgments gives an impression of “arbitrariness”, that this is contrary to the legal certainty, that consistency is necessary to preserve public confidence in the administration of justice (§§ 3-4, 6 of the dissenting opinion).

I like this kind of cases because it shows the extent of unknowability we live in, and supports the general Critical Legal Studies perspective on indeterminacy of law in slightly more complex cases.

ECJ: contractual clause prohibiting Internet trade is illegal, Pierre Fabre, C-439/09

Pierre Fabre Dermo-Cosmétique SAS manufactures and markets cosmetics and personal care products under brands Avène, Galénic, Ducray and Klorane. Their general contractual clause imposed an obligation on distributors was that the products have to be sold in a “physical space” in the presence of a person with a diploma in pharmacy, which de facto excluded internet trade (§§ 13-14).

Pierre Fabre tried to justify the clause with an intention to provide a personalized advice in order to ensure “cosmetovigilance” (§§ 17, 25), avoiding the risks of counterfeiting and free-riding between authorized pharmacies (§ 23), need to maintain the prestigious image of the products (§ 45). The French Competition Authority decided that the real aim of the clause is to prevent selling the goods to non-authorised distributors, to reduce considerably the ability of an authorized distributor to sell the contractual products to consumers outside its contractual territory, and to restrict competition (§§ 19, 38). Pierre Fabre got a fine of € 17 000.

The ECJ adjudicated that the reasons given by Pierre Fabre did not have a legitimate aim for restricting competition (§§ 44, 46).

ECtHR supports squatters, Rhino v Switzerland, 48848/07

About 100 squatters (mostly art students) occupied 3 buildings in the center of Geneva in 1988, and established the squat association “Rhino” (acronym for “Retour des habitants dans les immeubles non occupés” or “Return of inhabitants to non occupied buildings” in English). On 10/05/2007 the Swiss Federal Tribunal prohibited the association due its “illegal aims”, i.e. “subtract the buildings that they occupy from the market and speculation” (§ 45), and on 23/07/2007 police expelled the squatters (§ 28). However on 11/10/2011 the European Court of Human Rights adjudicated that the liquidation of the squatters association violated the freedom of association (Article 11 of the Convention).

The Swiss Government argued that the liquidation of the squatters association was necessary, since they had illegal aims and were implementing those aims with illegal actions (occupying buildings). It was necessary to forbid the association in order to re-establish the rights of the owners of the buildings. The ECtHR replied that there is no link between the protection of property rights and the liquidation of the association (§ 63).

The Court dismissed the argument that the dissolution was necessary in order to preserve public order (§ 64). Chairwoman of the squat association M. Kerchenbaum, secretary M. Pier and treasurer O. Connolly were awarded € 65 651 for pecuniary damage and € 21 949 to cover the lawyers.

Wikileaks proves that MEP Uspaskich is persecuted for political reasons

The European Parliament never saw such a striking case of political persecution as that of Viktor Uspaskich, Member of the EP, Chairman of the Lithuanian Labour Party. His political party was accused of non-payment of certain taxes, and last year the European Parliament waived his immunity. However the question is now re-opened due to the disclosure of secret notes of the US Embassy in Vilnius by Wikileaks:

1. It is stated in the 1st secret document that the State Secretary of the Lithuanian Government told to USA diplomats that it was the Government who “engineered the departure” (or expel) of Mr Uspaskich from Lithuania. It also follows that he also confessed that the real reason of the attack by the State was quite different from the formal one: the suspicion of Ministers that he might be related to Russian secret services. However there is no even a single proof of such a relationship. Therefore, he is formally accused of something else. As a Lithuanian, I would add that we, Lithuanians, have a general cultural-historic tradition to accuse Russians of all possible problems.
2. The 2nd secret document discloses that the Defense Minister of Lithuania told to the US Ambassador that the aim of the Governing Political Party was to remove the opposition leader Uspaskich from the post of head of the Labour Party and to put there someone else. By the way, the 2nd and 3rd Chairmen of the Party signed the final fiscal declarations for 2004 and 2005. Uspaskich (1st chronological Chairman) did not sign them. However nor the 2nd, neither the 3rd leader of the Party are even suspected of anything. Doesn’t it go in line with this secret document?

The scope and danger of this political persecution is much wider than any of the persecutions in cases Blumenfeld, 1-123/84, Amadei, A2-0034/86, Gaibisso, A2-0101/86, Valenzi, A2-0220/86 and A2-0221/86, Herklotz, 1-321/81, Marciani, A5-0422/03, or Brok, A7-0047/2011. The Committee of Legal Affaires of the European Parliament will consider this issue on Monday.

ECHR: Standard of “increased prudence” in a retrospective application of criminal law, Soros v France, 50425/06

Today George Soros lost his case in Strasbourg. In 1998 his investment fund Quantum Fund acquired 160 000 shares of the French bank Société Générale, and sold them several days later. This looked as a participation in a takeover attempt. The operation brought the profit of $ 2.28 million ($ 1.1 million at the French market, §§ 10-11). However in 2007 the Paris Appellate Court convicted Soros of buying shares based on insider information (Mr. P), and imposed a fine of € 940 507.22 (§ 30).

George Soros argued before the European Court of Human Rights that the French judgment had violated Article 7 of the Convention (nulla poena sine lege). The classic understanding of “insider trading” was that it is a use of “privileged information” by a person employed by the respective company or otherwise contractually related (§ 54). Does this conception cover Mr. Soros? The report of the French Commission of Stock Exchange Operations stated that it had been impossible to appraise whether the French law had forbade this kind of operations at the respective time (§ 14). However later the French law was amended in a manner making that operation clearly illegal.

The ECHR majority (4 versus 3) ruled on introduction of additional tests.

1. The 4 judges stated that he had “to doubt” about that operation, since previously the French first instance tribunals had ruled that an insider employed by a company could not use privileged information for such a personal benefit (§§ 56-58). Note: this question never went to appeal or cassation stage.
2. They qualified George Soros as “institutional investor”, and since he was this kind of person, he had to bring a “proof of increased prudence” (§ 59).

The minority opinion of 3 judges insists that the criminal law interpretation must be strict. The very fact that after the operation the French Government had to amend the written law shows that it was not precise at the respective time. The minority underlines the difference between “unavoidable imprecision” and “avoidable imprecision” of criminal law, and proposes to use this as a judiciary test.

Competition law policy of the ECHR

ECHR adjudicated that the competition law must be assimilated with the criminal law for the purposes of the European Convention of Human Rights in case A. Menarini Diagnostics SRL v Italy, 43509/08, § 44. This Florence company was subjected to a fine of € 6 million by the Italian competition authorities for a participation in a cartel fixing prices and dividing the market of tests for diagnosis of diabetes.

A. Menarini Diagnostics insisted on violation of the right to court, i.e. the right to a full review of the competition authority decision: as the Administrative Tribunal of Latium had recognized, the judicial control of competition cases is “weak”, “it is prohibited to the judge to exercise an in-depth control”, the judge cannot substitute its appraisal to that of the competition authority, the judge can only apply the legal norms identified by the competition authority, cannot modify the elements of the investigation and the very decision. The judicial control is limited to the verification of legality, of the logic and coherence of the decision (§ 52).

Nonetheless, the ECHR considers that the Italian Courts have a full jurisdiction in competition cases, since they can examine the elements of proof, verify whether the administration used the powers in an appropriate manner (§ 63), verify the reasonableness and proportionality of the choices within a decision, verify the technical things (§ 64), and change the sanction (§ 65).

ECHR: company tax litigation is a criminal and property case

Moldovan company Agurdino SRL producing chemical products was ordered to pay Value-Added Tax of € 126 000, and a fine of € 101 000. The Moldovan Supreme Court of Justice found in favour of the company, since it was operating in the Expo-Business- Chişinău Free Economic Zone, and therefore hadn’t been obliged to pay VAT (§§ 6-7). However then the Moldovan Parliament adopted an Act on Interpretation of the Act on the Free Economic Zone (§ 8). On the basis of this Act, the Supreme Court of Justice re-opened the case and ordered the Agurdino SRL to pay the money (§ 11).

Since the fine of € 101 000 has the purpose to deter re-offending rather than merely imposing a pecuniary compensation, the tax litigation must be qualified as “criminal” (§ 23). The money that could be kept after the first Supreme Court of Justice judgment is covered with the category of “possession” (§ 40).

The ECHR qualified re-opening the file after issuing a legislative interpretation as “appeal in disguise” violating the principle of legal certainty and property rights.

ECJ: in the absence of “complementary elements”, controlling 98 % of shares does not presume liability of the mother company, Elf Aquitaine, C-521/09 P

The ECJ annulled the decision of the European Commission ordering mother company Elf Aquitaine SA to pay the fine of € 45 million jointly with its daughter company Arkema SA for a participation in cartel AMCA at the monochloroacetic acid market. The EU General Court held the mother company liable due to the fact that it controls 98 % of the daughter’s shares (§ 158). The ECJ set aside this judgment and dismissed the conclusions of its own Attorney General.

Elf Aquitaine argued that she is a “pure holding” without operational functions, the daughter company never got any instructions from the mother company, the daughter company did not inform the mother company, the daughter company was financially autonomous and could act without any authorization, and the daughter company was perceived as autonomous by the third parties (§ 160).

The ECJ adjudicated that the right to motivation required the European Commission to bring “complementary elements” showing an interference of the mother company into the commercial behavior of the daughter company.

EU General Court: USSR coat of arms may not be registered as a trademark, Couture Tech Ltd., T-232/10

UK company Couture Tech Ltd. tried to register Soviet coat of arms as a trademark. The EU General Court refused because this symbol is prohibited in Hungary, Latvia and Czech Republic, and therefore is contrary to public policy and morality (§ 60).

Couture Tech argued that, unlike the swastika, the political connotation of the USSR coat of arms has been diffused and transformed into a provocative one, connected with the concept of the avant-garde, so that the trademark applied for had acquired “a new distinctiveness” (§ 46).

The EU General Court replied that it is still perceived as a political symbol (§ 64).

“Incontrovertible and direct proof” standard prevents oil company YUKOS from getting the desired victory, YUKOS, 14902/04

Russian oil company YUKOS led by businessman and politician Mikhail Khodorkovsky bankrupted in 2007 due to the fiscal debt of € 16 billion for 2000-2003. The Parliamentary Assembly of the Council of Europe fully supported YUKOS and declared this persecution political. However on 20/09/2011 YUKOS failed to prove the same before the European Court of Human Rights.

YUKOS argued that the circumstances of the tax assessment and enforcement, the prosecution of Mr Khodorkovsky and other owners and officials of the company, as well as the statements of the highest State officials show the intention of the Russian Government to destroy the company and to take control of its assets (Article 18 of the Convention, § 661).

The ECHR recognized a violation in the speed with which the Russian courts had conducted the tax assessment for 2000, and in defining the penalties. However the position of YUKOS concerning Article 18 was destroyed in 2 steps:

1. Article 18 (principle prohibiting application of restrictive measures for purposes other than the public ones) is applicable only where the restrictions are permitted under the Convention. In this manner the Court cut off the violations where the restrictions had not been permitted.
2. The Court applied the “incontrovertible and direct proof” standard. The statement of the highest State officials do not meet this standard – especially taken in their respective context – for the purpose of proving that the aim of Russian authorities was to destroy the company for political reasons (§ 665).

This result was foreseeable after the judgment in case Khodorkovsky. The same YUKOS arguments could have more chances under the classic Article 6(1) on fair and impartial trial.

Transfer of responsibility from mother to daughter company, Koninklijke Grolsch, T-234/07

The EU General Court annulled the anti-competitive agreement fine of € 31 658 000 imposed on Koninklijke Grolsch NV, since it was not directly involved in the agreement with other major Dutch beer producers Heineken, InBev, and Bavaria. It was its filial Grolsche Bierbrouwerij Nederland.

Contrary to the reply of Koninklijke Grolsch to the European Commission’s communication (§ 45), individuals P.P.S., R.S., H.O.B., P.M., K.H., L.S. were not employed by Koninklijke Grolsch, but by Grolsche Bierbrouwerij Nederland (§ 47). Thus, the judges say that they did not act on behalf of Koninklijke Grolsch.

According to the EU General Court, the notes of Mr. J.T., President of Administrative Council of Koninklijke Grolsch, on the invitation to a meeting with coordination of prices agenda dated 08/01/1999, and his 2 telephone conversations with directors of Heineken around 05/07/1999, do not prove the participation of Koninklijke Grolsch in the cartel agreement (§§ 61, 63). Previously Mr. J.T. had participated in the agreement only as a Director General of Grolsche Bierbrouwerij Nederland.

Documents of InBev company mention the participation of the “group Grolsch” in the cartel but do not indicate Koninklijke Grolsch as such (§ 56).

At the level of legal strategy, this case shows the way for transferring liability to a filial.

ECHR: possession right covers any kind of money

The judgment 25575/08 provides a new interesting light on all cases involving money litigation. Moldovan individual enterprise Dragostea Copiilor-Petrovschi-Nagornii owned a secondary school in Chişinău. In 2001 the Rascani District Court ordered the enterprise to pay $ 78 400 to Mr M. (§ 5). This Order was executable for 3 years but Mr M. made a formal enforcement request only some 5 years later. Therefore, on 18/07/2007 Chişinău Court of Appeal dismissed M’s action due to the missed deadline (§ 8). From this point, the ECHR starts to consider $ 78 400 as “possession” of the individual enterprise (§ 40).

However on 13/07/2007 the Department for the Execution of Judgments wrote him a letter recognizing that his enforcement warrant had been registered within the 3 year deadline. The Moldovan Supreme Court of Justice allowed Mr M.’s appeal, since this letter could have been obtained later than 18/07/2007 (§ 13). Nonetheless, the ECHR replied that such a position does not preserve a “fair balance”, and is contrary to Article 1 of Protocol no. 1 to the Convention.

This case leads us to re-think lots of other litigations involving money.

ECHR: the son of French President de Gaule could not insult Harki, since they are not defined, Boumaraf, 32820/08

Mr. Philippe de Gaulle, while making a comment on his book about his father Charles de Gaulle, implied that 100 000 Harki were traitors – at least as Mr. Amar Boumaraf understood this. The Harki are usually understood as Muslim Algerians who served as auxiliaries in the French Army during the Algerian War from 1954 to 1962.

Initially the question was whether the Harki are a “sufficiently limited group”. There are three judgments (15/10/1985, 06/12/1994, 12/09/2000) of the French Court of Cassation recognizing the existence of this group. Before the ECHR, the question was transformed into whether these three judgments are a “well-established jurisprudence”. The ECHR replied that despite a clear definition of the Harki in the judgment dated 12/09/2000, it “alone” cannot create a “well-established jurisprudence”.

ECJ: European immunity of an MEP does not cover defamation, Patriciello, C-163/10

A Member of the European Parliament (MEP) has two kinds of immunity: the one guaranteed by the EU law in cases related to her opinions, and in other cases it is provided or not by national law. Italian MEP Aldo Patriciello has publicly declared that a police officer falsified the time concerned when booking several drivers whose vehicles were parked in contravention of road traffic laws. Thus, he made a “false accusation of a public official with aggravating circumstances” according to the prosecution (§ 11).

On 05/05/2009 the European Parliament decided to defend the immunity of Mr. Patriciello in arguing that this declaration is a political opinion expressing the right of the citizens to have an easy access to a hospital, which had an important impact on the daily life of his constituents. The MEP did not act for his own interest, and did not intend to insult the policewoman (§ 12).

However according to the ECJ this kind of opinion accusing the police officer did not have a “direct and obvious” connection with “parliamentary duties” (§§ 35-36). It must be underlined that this interpretation is applicable to the immunity directly provided by the EU law, but not to that existing under national law.

Extracting fraud investigation documents from the OLAF, Tillack, 943/2007/PB

Fraud is an old problem of the EU. After the memorandum of whistleblower Paul van Buitenen dated 07/03/2002, and inaction of the OLAF (Office of Anti-Fraud Fight), journalist Hans-Martin Tillack published 2 articles on the subject in Stern. The OLAF decided to punish the journalist. He was accused of handing over € 8000 for certain investigation documents to an OLAF official. The OLAF requested the German prosecution to open an investigation, but Germans closed it (§ 3).

The complainant in case 943/2007/PB requested the OLAF to disclose the name of the OLAF official who signed the letter to the German prosecution, as well as the letter itself, to disclose the instructions to the relevant OLAF staff who negotiated starting the “swift action” against journalist Tillack with the Hamburg prosecution, as well as to disclose other documents on possible fraud within the European Commission.

The complainant filed the same request twice but the OLAF ignored it. Only after filing a complaint to the European Ombudsman the OLAF disclosed the name of its official who initiated the persecution of the journalist (§ 40), as well as provided a partial access to the documents.

The Ombudsman explained that the institution must give valid reasons enabling the applicant to decide whether the non-disclosure is grounded, and not limit itself with a simple statement that “it carried out a concrete and specific examination” (§ 58).

"The Economist" establishes hegemony over other languages

Spanish trademark "El Economista" lost appellate proceedings to the UK trademark "The Economist" before the OHIM on 05/08/2011.


The Board of Appeal concluded that the trademarks are "visually similar at least to an average degree", since both contain the word "ECONOMIST", "THE" and "EL" have a common letter "E", and the Spanish letter "A" is at the end (marginality)(§ 28). Thus, the Board did not give any meaning to the colors (orange v black style), and to the fact that colors distinguish "ECO" from "NOMISTA" in the Spanish version.


According to the Board, the letters "ECONOMIST" are pronounced in the same manner, and it means that the aural similarity is "above average" (§ 29). Thus, the fact that in English we make accent on "CO", and in Spanish on "MI", did not had a value.


According to the Board of Appeal, both trademarks are conceptually "similar" (§ 30), and the fact that these are different languages is not a decisive factor.

In certain cases this decision will delete linguistic borders among Germanic, Romanic, and possibly also Slavic and Baltic languages.


EFTA Court orders opening a formal State aid investigation procedure against the will of the European Commission, Konkurrenten, E-14/10

I like this judgment of 22/08/2011, since it shows how a competitor may successfully attack a decision of the EFTA Surveillance Authority or the European Commission (both had the same view here) not to open the formal investigation procedure.


From 1997 to 2004 bus enterprise SA Oslo Sporveier owned by the Oslo City got an aid of NOK 1.124 billion (€ 144.4 million, §§ 17-18). Competitor bus company Konkurrenten.no SA lodged a complaint, and in 4 years received a Surveillance Authority decision not to open the procedure. The EFTA Court considered that it was not clear whether this aid had not been excessive for the purpose of compensating the operation of non-profitable scheduled bus services, and whether the aid had been kept separate from any other commercial activities carried out by Oslo Sporveier, such as operating tour buses (§ 77).


The Surveillance Authority supported by the European Commission tried to convince the Court that it was an existing aid, and therefore compatible with the EEA law. They argued that the difficulty in this kind of calculation was ignorable, since in general the aid had been "existing".

Benelux Court of Justice - the most minimal space for the loosing party's position in its judgment

For a postmodern lawyer, the position of the loosing party is one of the most interesting things. Among all the Courts that are reviewed in this blog, the Benelux Court of Justice has with no doubt the most minimal space in its judgments for the parties to a litigation. For instance, in judgment Salvatore Sileci, A 2010/4, it just mentions that Mr Sileci filed 3 procedural documents. If you are clever enough you can try to deduce the positions of the parties from the preliminary questions of the Belgian Court of Cassation.

For contrast, the WTO Panel, the Permanent Court of Arbitration, the ILO and the European Ombudsman provide maximum space, and even describe the content of each procedural document. Apparently, the EU OHIM starts publishing the very documents on its website, and thus making a record on representing the ideas of the parties.


The ECJ, the ECHR, and the UN HRC are, in turn, situated between the Benelux Court of Justice and the adjudicators providing the maximum space.

Permanent Court of Arbitration downgrades international organisations in contractual relations, Polis Fondi, 2010-8

Polis fondi immobiliari di Banche popolare SGR.p.A. won an arbitration case against UN agency International Fund for Agricultural Development. The UN agency was refusing to pay the rent of € 265 734.47 for its Roma headquarters, since the Italian Government approved for reimburse only 80% of this sum. Therefore, according to the UN agency, the rent amount was modified under the Headquarters Agreement concluded between the UN agency and the Government - especially from the perspective of good faith principles. The UN agency argued that the Polis fondi had to be aware of the latter Agreement.

However the Permanent Court of Arbitration found that this would be "an exceptionally onerous burden on private parties" requiring "an unreasonable level of familiarity regarding the intricacies of international organizations as subject of private law".