Jurisdiction in multi-party software dispute

19 May, 2021

On 19 May 2021, judgment was issued in Trappit S.A. & others v. American Express Europe LLC & another [2021] EWHC 1344 (Ch) by Mr Justice Snowden sitting remotely in the Intellectual Property List of the Chancery Division in the High Court in London.  This judgment concerns a challenge to jurisdiction heard over two days in January 2021.

The underlying dispute involves allegations of plagiarism and misappropriation of confidential information concerning an online flight booking system which was previously the subject of criminal proceedings at the suit of Trappit Tec (second claimant) before the Madrid Court during 2015-2020 (“Spanish Proceedings”).  The Spanish Proceedings, which included a claim for civil damages, were provisionally dismissed in August 2020.  The provisional dismissal was upheld on appeal by the Provincial Court in October 2020 (“Spanish Appeal Decision”).  In the meantime, the claimants commenced proceedings in this jurisdiction seeking damages for essentially the same substantive allegations.  The defendants challenged jurisdiction under CPR  Part 11 on the basis of Articles 25, 29 and 30 of Regulation (EU) No.1215/2012 (“Brussels Recast”) and by reference to the Court’s inherent jurisdiction to prevent abuse of process.  The jurisdiction challenge was amended in light of the Spanish Appeal Decision to remove reliance upon Article 30 and revise the abuse of process basis.

In summary, Snowden J found that: (1) the English Court lacks jurisdiction in respect of the claim between Trappit S.A. (first claimant) and American Express Europe LLC (first defendant) (“AEE”) pursuant to Article 25 Brussels Recast, because all such claims – whether contractual or non-contractual – fell within an exclusive jurisdiction clause in favour of the Madrid Courts contained in a Non-Disclosure Agreement between the original contracting parties according to Spanish law (Judgment [66] to [98]); (2) the same position applies in respect of claims by Trappit Tec (second claimant) against AEE which accrued prior to and were transferred as part of an assignment of rights between such claimants in March 2015, but clause 18 did not otherwise apply as between non-contracting parties as a matter of Spanish law (Judgment [99] to [138]); (3) Article 29 Brussels Recast was not engaged in light of the Spanish Appeal Decision, because the effect of provisional dismissal was that the Madrid Court was no longer seised of the Spanish Proceedings at or by the time of determination of the jurisdiction challenge (Judgment [139] to [160]); and (4) the commencement and pursuit of the English proceedings, although duplicative of the substantive allegations in the Spanish Proceedings, did not amount to an abuse of process in the absence of any res judicata or issue estoppel arising from the Spanish Appeal Decision (Judgment [161] to [194]).

As regards (4) above, Snowden J observed that the present case was “very close to the margins of an abuse or misuse of the process of the English courts” (Judgment [182]).  He further observed (at [190]) that other mechanisms were available to the defendants for seeking summary determination or dismissal of the remaining claims, commenting in this context as follows: “The power to strike out repeat proceedings for vexation is conceptually different from the power to strike out a hopeless case.

A link to the judgment can be found here

Stephen Houseman QC (leading George Spalton QC at 4 New Square) was instructed by Mark Howarth of Eversheds Sutherland (International) LLP on behalf of the Defendants.