Volkswagen v Network System Technologies (CFI, ORD_12483/2024, 23 April 2024)

Dhenne Avocats · 10 October 2026

Our analysis

Summary

By an order of 23 April 2024 (UPC_CFI_513/2023, ACT_597691/2023, App_11431/2024, App_11444/2024 and App_11835/2024), the Munich Local Division (Zigann, presiding and judge-rapporteur, Pichlmaier, Perrotti) dismissed the applications for security for costs brought by Volkswagen AG and Audi AG, and by Texas Instruments Incorporated and Texas Instruments Deutschland GmbH, against Network System Technologies LLC (NST), the claimant in the infringement action on EP 1 552 669 B1. On the same day the division dismissed the parallel applications in actions UPC_CFI_514/2023 and UPC_CFI_515/2023 between the same parties. The order demands concrete evidence: a seat outside the EU and the claimant’s lean structure are not enough.

Question

Must a US claimant with two employees and no physical assets provide security for costs under Art. 69(4) UPCA and Rule 158.1 RoP?

Decision

No. Security may be ordered in main proceedings at any stage, but the division has discretion: it balances the defendant’s protection against the claimant’s right to an effective remedy, having regard to the claimant’s financial position and the likelihood that a costs order would be unenforceable or enforceable only with undue burden. The party seeking security must put forward specific facts. The defendants offered only general allegations. Relying on the non-EU seat would amount to a priori discrimination based on nationality, nothing showed that UPC decisions are hard to enforce in the United States, NST’s lean organisation reflects its business model and its patent portfolio could be seized. The costs of the applications follow those of the main proceedings. Leave to appeal was granted.

Key points for practice

• Practical point: an application for security against a lean foreign claimant must be backed by concrete evidence on solvency or enforcement obstacles, the location of the registered office alone carries no weight.

Provisions applied

Agreement on a Unified Patent Court

Art. 69(4)

Rules of Procedure

Rules 158.1 and 220.2

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)

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.