Network System Technologies v Volkswagen (CFI, 23 April 2024)

Dhenne Avocats · 10 October 2026

Our analysis

Summary

By an order of 23 April 2024 (UPC_CFI_514/2023, ACT_597692/2023, App_11434/2024, App_11453/2024 and App_11833/2024), the Munich Local Division (M. Zigann, T. Pichlmaier, P. Perrotti), in the infringement action on EP 1 875 683 brought by Network System Technologies LLC (NST) against Volkswagen AG, Audi AG, Texas Instruments Incorporated and Texas Instruments Deutschland GmbH, dismissed the defendants’ requests for security for costs. The order declines to infer an enforcement risk from the mere light structure of a claimant based outside the EU.

Question

Must a US patent-holding company with no tangible assets and a light structure provide security for costs under Art. 69(4) UPCA and Rule 158.1 RoP?

Decision

Art. 69(4) UPCA is not confined to the situations in Articles 59 to 62, and Rule 158.1 RoP allows security at any time, including in the main proceedings. The court considers the party’s financial position and the likelihood that a costs order may not be enforceable, weighing the defendant’s protection against the claimant’s right to an effective remedy (Art. 47 of the Charter). The applicant for security must file a reasoned request, which the other party must then rebut in a substantiated way. Here, no concrete evidence showed an enforcement risk: a seat outside the EU cannot count without a priori discrimination, difficulty in enforcing a UPC decision in the United States was not shown, and NST’s light structure fits its business, its patents being available for seizure. Costs follow the main proceedings and leave to appeal was granted.

Key points for practice

• Practical point: a request for security for costs must rest on concrete signs of insolvency or non-enforceability, the claimant’s light structure and its US seat are not enough.

Provisions applied

Agreement on a Unified Patent Court

Art. 54, 69(4) and 73(2)(b)(ii)

Rules of Procedure

Rules 158, 220.2 and 224.1(b)

Charter of Fundamental Rights of the European Union

Art. 47 and 52(1)

Case law cited

Munich Local Division, 29 September 2023 (UPC_CFI_15/2023), Helsinki Local Division, 20 October 2023 (UPC_CFI_214/2023), Munich Central Division, 30 October 2023 (UPC_CFI_252/2023), Paris Central Division, 13 November 2023 (UPC_CFI_255/2023), The Hague Local Division, 13 February 2024 (UPC_CFI_239/2023), CJEU, 15 September 2016, Joined Cases C-439/14 and C-488/14

Prepared by Dhenne Avocats from the official decision, consulted on 10 October 2026. The database is updated every week, on Friday. Only the official text is authoritative.