Godo Kaisha IP Bridge 1 v Huawei Technologies Co. Ltd & Ors

Where a defendant is resident in a state that is party to the Hague Service Convention, convention service is the normal and primary method. Alternative service requires a good reason and, where the state has objected under article 10, exceptional circumstances.

The court must assess the particular facts and balance the relevant factors. Delay or additional expense alone is insufficient. Delay may contribute to exceptional circumstances when combined with litigation prejudice, or when it is exceptionally long and incompatible with the due administration of justice. Normal commercial prejudice, possible delay in obtaining royalties, the desire for injunctive relief and parallel foreign proceedings did not meet that threshold.

Godo Kaisha IP Bridge 1 brought English patent infringement proceedings against three members of the Huawei group concerning standard-essential patents and related FRAND obligations. The First and Second Defendants were companies incorporated in China, while the Third Defendant was a UK subsidiary.

Following a without-notice order permitting service out of the jurisdiction and alternative service in the United Kingdom, the First and Second Defendants applied to set aside the alternative-service provisions. They also sought an extension of time for any jurisdictional challenge. The central issue was whether the circumstances justified departing from service under the Hague Service Convention.

1. The Extension Application was dealt with by agreement. Time for any CPR r.11(1) jurisdictional challenge was extended until determination of the Set Aside Application.

2. The court had power to permit service by an alternative method or at an alternative address under CPR r.6.37(5)(b)(i) and r.6.15(1). Such an order required a good reason and, where the defendant’s state had objected under article 10 of the Hague Service Convention, exceptional circumstances. The essential concern was that the defendant should be adequately informed of the claim. Convention service remained the prime method.

3. Whether exceptional circumstances existed depended on the particular facts and required a balancing exercise. Mere delay or additional expense was insufficient. Delay could contribute to exceptional circumstances if coupled with litigation prejudice or if it was so exceptional in length that it was incompatible with the due administration of justice. Urgent interim relief and relief under the Arbitration Act 1996 were examples of potentially relevant factors.

4. The likely period for Hague service in China was uncertain, but the Defendants’ offer to accept alternative service after 11 months meant that the relevant delay was not exceptionally long. The Claimant’s loss of royalties, desire for an injunction, and the existence of related German and Chinese proceedings were ordinary or insufficiently established forms of prejudice. The possibility of a Chinese Behaviour Preservation Order was unsupported by adequate evidence and did not justify departing from international comity. The fact that proceedings against the UK subsidiary could continue was relevant but did not make the circumstances exceptional.

5. Taking the factors individually and collectively, the court found no exceptional circumstances. The order of Chief Master Marsh dated 22 February 2021 was set aside insofar as it permitted alternative service on the First and Second Defendants.

First-instance decision. The judgment records that the Set Aside Application was a rehearing rather than an appeal.