Seven Licensing Company Sarl & Anor v FFG-Platinum SA & Ors

Under Article 28, a court second seised has a discretion to stay proceedings concerning related actions. The applicant bears the burden of showing that a stay is appropriate. Relatedness requires a sufficiently close connection and a value judgment that hearing the actions together is expedient to avoid irreconcilable judgments. Relevant considerations include the degree of connection, the risk of inconsistent decisions, the stage and likely timing of each proceeding, and which court is best placed to decide the issues. Exclusive jurisdiction clauses and the governing law of the parties’ agreements may be important. A stay should be refused where the foreign proceedings are narrower, involve different parties, are unlikely to determine the underlying dispute, or are unlikely to produce conflicting judgments.

The claimants brought English proceedings concerning unpaid instalments and related obligations under agreements for the sale and licensing of intellectual property rights. The agreements were governed by English law and contained exclusive English jurisdiction clauses.

The defendants sought a stay under Article 28 of Council Regulation (EC) No 44/2001, relying on Greek proceedings concerning whether Greek banks were required to honour a bank guarantee for one instalment. The Greek proceedings involved different parties and were not expected to be heard until a substantially later date. The issue was whether the English and Greek proceedings were sufficiently related, and whether a stay was expedient to avoid irreconcilable judgments.

1. Application dismissed. The defendants failed to establish that the English and Greek proceedings were so closely related that it was expedient to hear and determine them together.
2. Article 28 applies where the court is second seised and Article 27 does not apply. The power to stay is discretionary, and the burden of proof or persuasion remains on the applicant. There is no presumption in favour of a stay.
3. The court applied a broad, commonsense assessment of relatedness. The relevant question was whether there was a sufficiently close connection, together with a sufficient risk of irreconcilable judgments, to justify a stay. The assessment was not mechanical and required a value judgment.
4. Relevant considerations included the extent of the connection, the risk of irreconcilable decisions, the stage reached in each proceeding, the likely time before judgment, and which court was best placed to decide the issues. The likely delay in the first-seised proceedings could properly be taken into account.
5. The Greek proceedings were narrow. They concerned payment under the second bank guarantee, involved the banks and FFG-DH, and did not bind SLC or FFG-IP. The English proceedings concerned the wider underlying payment obligations, including further instalments and disputes between all material parties.
6. The English court was best placed to determine the underlying obligations because the relevant agreements were governed by English law and contained exclusive English jurisdiction clauses. The Greek court could then determine the distinct Greek-law issues concerning the bank guarantee against the background of the English court’s findings.
7. The defendants’ proposed revised payment schedule and authorisation arguments were weak and could not establish a sufficiently substantial connection. The proceedings could be determined in England before the Greek proceedings were likely to reach an effective trial. The application for a stay was therefore refused.