17    THE NETHERLANDS

17.1    LEGAL FRAMEWORK

The judicial process is one of those matters which has been only harmonized a little within the European Union. Each member state, including The Netherlands, is relatively free to set the rules for procedures conducted before its national courts. However, states must act in accordance with the general principles, issuing, in particular, from the European Convention on Human Rights.

17.2    GENERAL PRINCIPLES OF CIVIL PROCEDURAL LAW

The main principles under the Netherlands civil procedural law can be summarized as follows:

1)            Most civil proceedings require the preparation of written position. Even when the law allows itself to be limited to oral considerations, it is recommended at most times to file, in addition, written evidence (see also paragraph 0).

2)            In civil matters, each party must notify the other in writing, in principle at the beginning of the proceedings, regarding the pieces of evidence on which the legal action is based. The risk of a last minute surprise or of a hidden item, discovered during the hearing, is relatively low in the Netherlands.

3)            Civil proceedings in the Netherlands are initiated either by writ of summons (dagvaarding) or by petition (verzoekschrift). In that respect a distinction is usually made between contentious and voluntary jurisdiction of the courts. There are no clear criteria by which both types of jurisdiction can be distinguished. As a rough-and-ready rule one could say that contentious jurisdiction covers the matters in which the court has to resolve a dispute between parties, while voluntary jurisdiction sees to matters in which the court is requested to grant a general provision or an appropriate measure.

4)            In civil proceedings there are special legal measures available for plaintiffs to obtain provisional relief affecting property of debtors to obtain security for judgments to be obtained. A distinction must be made between a conservatoir beslag, i.e., protective measures by attachment which anticipate a later judgment and executoriaal beslag, i.e., enforcement measures by attachment to be taken after the  judgment has been obtained. As a result of the relatively new requirements (2011) for the petition for attachments, it has become somewhat more difficult, costly and time-consuming for a creditor to lay an attachment on the assets of its debtor: a creditor is required to provide more information and background to the case (and earlier proceedings), before it will be able to obtain leave from the competent judge to lay a conservatory attachment.

5)            Under the Netherlands law, a party is required to submit documents and information (whether electronically stored or not) if and in so far as they relate to a specific legal relationship (tort, contract); are described with sufficient specificity and are in the possession of the party that is being asked to submit them (exhibitieplicht).

6)            The adversarial principle is the basic guideline in civil law proceedings; unilateral measures are the exception. Unilateral measures are those taken at the request of a party, without the judge hearing the other party. They are generally reserved for cases in which the judge recognizes that the element of surprise is necessary (f.i ex parte injunctions in IP matters). Sometimes, it is extreme urgency that justifies the assumption of ‘surprise’ but it is relatively rare (it must be demonstrated that the urgency is such that it is necessary to derogate from the fundamental principle of adversarial proceedings in court).

7)            There is a significant difference between substantive proceedings on the merits and preliminary proceedings. Substantive proceedings on the merits are basically intended to definitively decide the dispute (subject to a party making an appeal). In preliminary proceedings, the judge does not decide the dispute but has the power, under certain conditions, to

arrange a provisional situation. Preliminary injunction proceedings are increasingly common, especially in cases related to IP and innovation. This is one of the first things to check, because if this is the case, there is no time to lose (see paragraph 0 below).

17.3    TWO TYPES OF CIVIL PROCEEDINGS

All civil proceedings in the Netherlands are conducted before professional judges. Jury trials do not exist in The Netherlands. In the context of IT/IP disputes the following types of proceedings are common: preliminary proceedings (kortgeding) and substantive proceedings on the merits (bodemprocedure). For patent cases, there is also a specific type of proceedings on the merits available, i.e. ‘accelerated proceedings on the merits’ (Versneld Regime in Octrooizaken (VRO)).

17.3.1    Preliminary proceedings

In general, preliminary proceedings are the manner in which IT/IP disputes are litigated in The Netherlands. The plaintiff needs to have and assert an urgent interest for preliminary relief for the matter to be admissible in preliminary proceedings. In general, trade mark or copyright infringement in fact implies an urgent interest. The plaintiff first sends a draft of the writ of summons to the District Court. The court will then set a date for oral argument, taking into consideration the schedule of the court and the schedules of the counsel(s) (to an extent). Usually, a hearing will be scheduled within two to eight weeks after the writ has been submitted. The proceedings are started by serving the writ of summons upon the defendant.

At the hearing both parties can argue their case and it is only at that occasion that the defendant has to present the true scope and nature of its defence. Preliminary proceedings take place before one judge only, and only allow for preliminary measures to be awarded. The nature of preliminary proceedings is informal and the judge has large discretionary powers, in particular in matters of evidence. Evidence is primarily in the form of documents that have to be submitted to the court before the oral hearing. As a general rule, live testimony by witnesses is not available in preliminary proceedings. A judgment can be obtained within approximately 2 to 3 months from the date of the writ of summons.

Please note that TRIPS and the Dutch Code of Civil Procedure provide that the plaintiff will have to start substantive proceedings on the merits within a “reasonable period” after an injunction has been obtained in preliminary proceedings, failure of which will lead to the lapse of the judgment. When taking a preliminary injunction, the preliminary judge determines the “reasonable period” for bringing the claim to the substantive proceedings on the merits (frequently 6 months after the preliminary injunction). However, in many cases parties reach a settlement after preliminary proceedings in order to avoid lengthy proceedings on the merits.

17.3.2    Substantive proceedings on the merits

In regular substantive proceedings on the merits each party will have the opportunity to file procedural documents. The plaintiff will file a writ of summons and the defendant a statement of defence.

At the judge’s discretion the parties will have to appear in court (to provide more information and/or to try to reach a settlement) and/or will have the opportunity to file further briefs. Once all briefs have been filed the court can schedule oral pleadings on the request of either party. If the court is of the opinion that parties have had sufficient opportunity to orally discuss the case during a prior personal appearance it may decide not to schedule oral pleadings. Oral pleadings are usually held 12 to 18 months after the start of the proceedings and a judgment can then be expected within 6-12 weeks from the date of the oral pleadings. The Court may persist a judgment if it suits her.

17.4    MILESTONES OF THE CIVIL LAWSUIT

17.4.1    Competence of the court in first instance

There is an important dispute concerning the question of which court has jurisdiction. The Netherlands is divided into eleven districts, each with its own court. The district court is made up of a maximum of five sectors. These always include the administrative sector, criminal sector, the civil sector and the sub-district sector.

• The “absolute competence” (absolute competentie) refers to the type of court which has jurisdiction to deal with the lawsuit. In first instance, as a rule, the district court has jurisdiction. The court of appeal has jurisdiction in appeal cases. The national supreme court has jurisdiction in cassation cases. As from 1 July 2011, the sub-district of the district court (sector kanton van de rechtbank) has jurisdiction with regard to claims with a maximum of € 25,000. Furthermore, the sub-district of the district court deals with all cases involving rents, hire purchase and employment. The civil sector of the district court (civiele sector van de rechtbank) handles cases not specifically allocated to the sub-district.
• The “relative competence” (relatievecompetentie) refers to the regions in which the dispute must be brought to justice. The main rule is that the competent court is determined by the domicile of the defendant.

It happens that a dispute involves several countries. This is even more true when the internet comes into play. The first thing to do is to

identify the country in which the proceedings have to be introduced (in defence, the attorney-at-law should check also the means of challenging the jurisdiction of the court, if necessary). The issue is regulated by European legislation, but that legislation is complex.

17.4.2    Written pleadings in first instance

In principle, it is the plaintiff who initially produces a writ of summons (or petition). The defendant responds. The plaintiff may further respond (if the case is complex and permitted by the court) and so on.

The writ of summons (or petition) must contain the date upon which the case will be submitted to the court and a thorough description of the claim. It must also identify evidence, including prospective witnesses, to substantiate it. The summons must also contain a description of the defendant’s counter arguments if known. The reason for this is to concentrate litigation as much as possible. In The Netherlands, it is common to hand in the exhibits on the first scheduled date on the “role” (eersteroldatum). This is an administrative action at the courts and not a “real” oral hearing. If the defendant is outside the EU, there are deadlines to allow him to take knowledge of the existence of a trial and organize himself taking into account the distance.

Under the Netherlands professional rules for attorneys-at-law (advocaten) it is not allowed to issue a writ of summons without first summoning the other party separately. Only when a matter is of such importance that this earlier summoning cannot be waited for, this general rule does not apply.

Whenever pleadings (processtukken) are exchanged, they must be accompanied the exhibits (contracts, correspondence, statements etc.) referred to therein, unless these exhibits have been previously submitted. These exhibits are an important part of the evidence in civil proceedings (see also paragraph 0).

Deadlines are set early in the process and it is extremely difficult to change them later. This has the advantage of predictability, but the rigidity of the system is sometimes excessive.

In The Netherlands, the processing of the pleadings may be assigned to a judge who takes care of this matter only (rolrechter). This has the advantage of flexibility. If a problem arises, the judge may decide on it immediately.

In principle motions (incidenten) challenging the jurisdiction of the court, and to join an indispensable third party (impleader) must be filed before presenting the defence; a counter claim must be initiated together with the statement of defence, otherwise these rights are barred. Third parties who can demonstrate sufficient interest, may intervene before the last document is filed.

17.4.3    The oral hearing in first instance

After defense and counter claim, the court will set a date for oral hearings, unless the judge managing the case finds it necessary that both parties file a reply and rejoinder. This only happens when a matter is complicated.

During the oral hearing, at which parties have to appear in person with counsel, the judge either tries to encourage parties to settle the matter (which happens in approximately 50% of all the cases) or sets a date for final judgment or an interim judgment requiring further documentary

evidence or testimony by witnesses or experts. In more complex cases, f.i. patent cases, the judge may consent to oral pleadings before judgment. At the oral pleadings, the attorneys-at-law may submit their oral notes to the court  (and they will be part of the case files).

17.4.4    Judgment in first instance

After the hearing, the lawyers will receive the written judgment, often by post or electronic transmission. This may take a weeks or months (or even more than a year), depending on the number of cases to be treated, their complexity and the potential urgency.

In preliminary IP proceedings and IP proceedings on the merits a court may impose an injunction on the infringing party to refrain from any further infringements. The court may also order a recall of infringing products, publication of a rectification, supply of information regarding the infringement, such as the identity of customers or suppliers of infringing products and the details of such transactions. These court orders will be given under penalty of a fine. In proceedings on the merits the court may, in addition, order the infringing party to pay damages or surrender its profits made.

Once a judgment is rendered in a civil matter, its execution within the European Union is facilitated by the adoption of a number of Regulations that arrange recognition of decisions in the European Union.

17.4.5    Appeal at the court of appeal

Most of the time, an appeal can be made. The appeal proceedings are to be regarded as “new proceedings”. The proceedings follow the same principles as set out above. Despite rumours, it has never been demonstrated that having won or lost in the first proceedings has any impact on the chances of success at appeal.

17.4.6    Cassation at the national supreme court

The appeal in cassation is relatively rare. The Cassation court is not concerned with the facts and does not say who is right or wrong.  It will only verify that the procedure has been followed, and that the judge has applied the law correctly. It is therefore not a matter of re-hearing

the case, contrary to what occurs on appeal.

17.5    THE PRELIMINARY RULING (EUROPEAN COURT OF JUSTICE)

In disputes involving technology, IP and/or innovation, the rules are very often derived from a European directive or regulation.

When a judge in a national court has doubts as to the exact scope of a European directive or regulation or questions the compatibility of national legislation with the European statute from which it is derived, the judge has opportunity to ask a question to the Court of Justice of the European Union.

There is only one Court of Justice for the European Union, located in Luxembourg. It is the sole authority to interpret a directive or European regulation. In principle, all lawyers are admitted to plead before the Court. However, it is recommended to hire someone with some experience of this specific procedure.

In its considerations, the Court will not decide the dispute submitted to it. It will only inform the judge in the national court on the exact scope or meaning of the Directive or the European law in question, and tell the judge whether national law is compatible with the European statute. It will then be for the judge in the national court which has asked the question to settle the dispute, in strict interpretation of what has been laid down by the European Court.

17.6    LAWYERS FEES

At the end of the proceedings, the judge has the opportunity of imposing all (only in IP matters i.e. copyright, trademarks, patents and trade names) or part (in other matters) of the defence costs of the winning party on the unsuccessful party. In IP matters the court is relatively free to decide which costs are to be considered as realistic. The amount vary from case to case – simple and complicated. In other civil matters a base rate (liquidatietarief) is provided for in rules and the judge may only increase or decrease this to some extent to take into account the specificities of the case. The basic amount is determined according to the claim that is at stake.

17.7    DAMAGES

In substantive proceedings on the merits the court may award damages or order the defendant to surrender its profits (f.i. in case trade mark infringement).

For example, in IP matters these are only awarded if the defendant can be held responsible for the IP infringement and/or has acted in bad faith.

In preliminary proceedings, it is not possible to claim damages (generally speaking). It is only possible under certain circumstances to receive an advance payment for damages or surrender of profits.

Case law on the calculation of damages has not been very well developed in The Netherlands. If damages are awarded a party is entitled to compensation of actual damages, but determining these damages is in most cases not an “exact science”. In this regard, it is important that Dutch courts tend to take a conservative approach towards the calculation of damages. Awarding punitive damages or awarding double or triple damages is not possible under Dutch law. Alternatively, one can ask for the surrender of profits made by the infringement, but determining these profits can be a cumbersome exercise as well.

Against this background, most IP cases are about obtaining injunctive relief and not about damages.

17.8    EVIDENCE IN CIVIL PROCEEDINGS

17.8.1    Burden of proof

As a general rule, the burden of proof in proceedings on the merits is primarily on the plaintiff, i.e, the party that claims a particular position.

For example, it is up to the plaintiff to sufficiently clearly assert the scope of his trade mark right and how the defendant is infringing on that trade mark. To prove ownership of the trade mark – in principle – an extract of the trade mark register would be sufficient. If the defendant claims that the plaintiff is not the owner and/or the trade mark is invalid because of non-use, the defendant will have to prove this.

In case of copyright cases with a foreign author the plaintiff also has to provide evidence that the copyright also existed at the time of creation under the foreign law system.

However, Dutch law is relatively lenient in distributing the burden of proof between the parties in litigation. Principles of reasonableness and fairness will primarily determine which party has to produce certain evidence.

The same applies in preliminary proceedings except for the fact that parties do not have to submit indisputable evidence, but parties have to make their assertion sufficiently plausible.

17.8.2    Discovery of documents

Most evidence used in litigation in The Netherlands is in the form of written evidence. Generally, the concepts of “discovery” of documents (as in the United States of America) or “saisicontrefaçon” (as in France) are not available under Dutch law.

Under Dutch law a party with a legitimate interest can request the court to order the opposing party to submit certain documents concerning the legal relationship of the parties. The attorney-client privilege is not affected by this provision.

17.8.3    Language

In The Netherlands judges do not like pieces of evidence written in a foreign language. If there is correspondence or contracts to be produced in court, they must be translated into the language of the proceedings. Otherwise, one risks seeing the piece of evidence altogether excluded from the proceedings in court. On the other hand, most of the time, a simple translation should be sufficient (mostly, it is not necessary to use a sworn translator).

17.8.4    Witnesses

In practice witnesses only play a role in proceedings on the merits and not in preliminary proceedings. Witnesses will not be heard at the trial itself. Witnesses can be heard within the framework of ‘pre-trial’ depositions, which can be conducted prior to or during the proceedings. Witness depositions take place before a judge who has the lead in the questioning of the witness.

The judge drafts a statement that summarizes what the witness has declared. In most situations testimony is only taken after an interim judgment in proceedings on the merits. In that judgment the court indicates on which particular issues it needs further evidence. Witnesses usually do not play a role in infringement cases.

17.8.5    Experts

The parties can submit reports by party appointed experts. The parties can also ask the court to appoint independent experts, either within the framework of a pre-trial expert’s report or at a later stage after an interim judgment has been rendered. In such an interim judgment the court indicates on which issues it wants advice from experts. The parties will be heard on the appointment of experts.

17.9    CRIMINAL PROCEEDINGS

Criminal proceedings (public law) operate under different rules. Without going into the details of these specific proceedings, we can report the following main thrusts:

On the level of evidence, the suspect has not much to do. Once the criminal authorities are notified of a complaint, they will organise the investigation and take the necessary measures. This has a significant advantage in terms of costs. On the other hand, this shows once again the loss of control of the suspect in relation to their complaint.

The investigation is conducted by authorities who are neutral in principle. They will instruct on uptake and completion. The prosecutor and the investigating judge (rechtercommissaris) do not judge, they investigate. Once the investigation is complete, they pass the case to another judge who will make a judgment after having heard the parties at a public hearing.

In general, the investigation is confidential. Depending on the circumstances, this confidentiality may even be opposed by the parties that are involved. Whether you are suspect, it is often difficult to know in which direction the investigation is moving. Moreover, regular leaks in the press are to be deplored. In sensitive cases, this means that one

must be always ready to respond in terms of communication.

When a case involves both a criminal investigation and civil or commercial proceedings, it is the criminal investigation which takes precedence (in principle). Civil proceedings will normally be suspended while the criminal investigation is ongoing.

As a result of the workload of the investigators and also the frequency of cases that involve several countries, it is not uncommon for criminal proceedings to last for several years. They may also be dismissed (geseponeerd).