UPC Court of Appeal: Costs appeal, suspensive effect

The Munich local division has ruled that the defendant in a proceeding about provisional measures has to bear the proceeding costs after it initially left a pre-litigation deadline for submitting a cease-and-desist undertaking unused, but then submitted a cease-and-desist undertaking after the application for provisional measures had been filed. The defendant appeals against this and requests that the appeal has suspensive effect. Pursuant to Art. 74(1) UPCA, an appeal has no suspensive effect unless the Court of Appeal decides otherwise upon a justified request by one of the parties. The Court of Appeal can therefore only grant the request if the circumstances of the case justify an exception to the principle that an appeal has no suspensive effect.

It must be determined whether, on the basis of these circumstances, the appellant's interest in maintaining the status quo until the decision on its appeal is made, exceptionally outweighs the respondent's interest. The appellants convey that cost assessment proceedings would incur further costs to them. However, such an interest does generally not outweigh the interest of the winning party in a quick decision about proceeding costs. Granting suspensive effect may exceptionally be justified if the order under appeal is clearly erroneous. However, this is not the case here (UPC January 18, 2024, CoA 4/2024).