Rule 158 – Security for costs of a party

1. At any time during proceedings, following a reasoned request by one party, the Court may order the other party to provide, within a specified time period, adequate security for the legal costs and other expenses incurred and/or to be incurred by the requesting party, which the other party may be liable to bear. Where the Court decides to order such security, it shall decide whether it is appropriate to order the security by deposit or bank guarantee.

2. The Court shall give the parties an opportunity to be heard before making an order for security. Rule 354 shall apply to the enforcement of the order.

3. The order for security shall indicate that an appeal may be lodged in accordance with Article 73 of the Agreement and Rule 220.2.

4. The Court shall, when specifying the time period in paragraph 1, inform the party concerned that if the party fails to provide adequate security within the time stated, a decision by default may be given, in accordance with Rule 355.

5. If a party fails to provide adequate security within the time stated, the Court may give a decision by default pursuant to Rule 355. 

Relation with the Agreement: Article 69(4).

Case law

Court of Appeal

IPPT20250114, UPC CoA, Total Semiconductors v Texas Instruments
Justified to allow discretionary review in appeal of orders of the judge-rapporteur (absent panel review) (R. 220.3 RoP, R. 333 RoP). The question whether the judge-rapporteur could decide alone on security for costs of a party and deny leave to appeal is an access to justice issue which the Court of Appeal can raise of its own motion. Possible for judge-rapporteur or the presiding judge to order security for costs. R. 158 RoP does not exclusively reserve orders on security for costs for a panel of the Court. This flexibility allows the judges to organise the proceedings in the most efficient and cost effective manner. Order on security for costs (R. 158 RoP) must be considered a case management order, making it subject to review by the panel (R. 333.1 RoP). System implies a broad interpretation of “case management decision or order”. Judge-rapporteur not competent to decide on leave to appeal in his order on security for cost (R. 158 RoP, R. 220.2 RoP, R. 333.1 RoP). Would circumvent the system with panel review. It is therefore only the panel, after panel review, that can decide on leave to appeal. 

IPPT20211217, UPC CoA, Curio v 10x
Application to the standing judge for suspensive effect of an appeal because of extreme urgency (R. 223.4 RoP) rejected regarding an order to the defendant to provide € 200.000 security for legal costs of the claimant (R. 158 RoP, Art. 69(4) UPCA). Within the discretion of the standing judge to dismiss the application without hearing the respondent. Extreme urgency under R 223.4 RoP is clearly distinct from, and does not require the impugned order to be “manifestly wrong”, but the Court is not convinced that the CFI was manifestly wrong and whether the CFI has given a correct interpretation of R 158 RoP regarding Art. 69(4) UPCA will have to be decided by the Court of Appeal at the end of the appeal proceedings.

IPPT20241129, UPC CoA, Aarke v Sodastream
Criteria for security for costs of a party (R. 158 RoP) Failing any guarantees or other special circumstances […] it is not relevant whether the claimant belongs to a - financially sound - group of companies. It is only the financial position of the claimant itself that is relevant. Whether a claimant is willing to reimburse the defendant if a cost order would be issued in favour of the defendant is not relevant either. The relevant criterion is whether, if that were the case, enforcement would be possible without undue burden. Irrelevant whether a cost order in favour of the defendant is to be expected. The Court should not engage in evaluating the likelihood of the outcome of the case when deciding on a request for security for costs. Not required that it is proven that enforcement is impossible. It is sufficient for a defendant to establish that enforcement of a cost order is unduly burdensome.

IPPT20241127, UPC CoA, Total Semiconductors v Texas Instruments
Discretionary review of an order of judge-rapporteur on security for costs and denying leave to appeal granted because of an access to justice issue which has not yet been decided and which the Court of Appeal can raise of its own motion (R. 220.3 RoP, Article 69(4) UPCA, R. 158 RoP, R. 333 RoP)

IPPT20241009, UPC CoA, Suinno v Micrsoft
Request for discretionary review in appeal (R. 220.3 RoP) only admissible, if leave to appeal against the impugned order is required (R.220.2 RoP) and the Court of First Instance refused to grant leave within 15 days of the order (R.220.3 RoP). Failure to indicate in the order for security that an appeal may be lodged in accordance with Article 73 of the Agreement and Rule 220.2 as required by R. 158.3 RoP cannot be that the unsuccessful party is deprived of its right to request leave to appeal an neither can the absence be understood as an implied leave to appeal. Instead, the unsuccessful party can still ask the Court of First Instance to grant leave to appeal by a separate decision.

IPPT20240927, UPC CoA, Volkswagen v NST
Information meant in R. 158.4 RoP – that if the party fails to provide adequate security within the time stated, a decision by default may be given in accordance with Rule 355 – does not necessarily have to be given in the Order to provide security for costs. In its Statement of appeal and grounds of appeal, Volkswagen had not requested that this information be included in the Order itself either. The Court thus does not see the necessity for rectification of the Order (R. 353 RoP). It therefore suffices that the information as meant in R.158.4 RoP is provided to NST by this separate order.

IPPT20240917, UPC CoA, Audi v NST
Security for legal costs and expenses (Article 69(4) UPCA, R. 158 RoP) requires a legitimate and real concern to be substantiated and proven by the party making the request, while the relative financial position of the parties is not as such a criterion, especially where the (limited) level of funding provided to a special purpose patent enforcement entity is a deliberate business decision. 

IPPT20240916, UPC CoA, ICPillar v ARM
Bank guarantee issued by a bank licensed in the US does not provide adequate security (R.158 RoP). As the reason for not allowing a bank guarantee to be issued by a US licensed bank is not solely based on nationality, but on substantive grounds, this is not contrary to any prohibition of discrimination, as ICPillar has suggested.

IPPT20240826, UPC CoA, Ballinno v Kinexon Sports
Adequate security for legal costs and other expenses equally available in appeal (Article 69(4) UPCA, Rule 158(1) RoP, Rule 222(2) RoP). Ballinno ordered to provide security for legal costs in appeal in the (total) amount of € 25.000.  The provision of security for costs does not hamper access to justice. (Article 47 EU Charter)

Court of First Instance

IPPT20250113, UPC CFI, LD Munich, Huawei v Netgear
Withdrawal of the provisional measures; each party shall bear its own costs,  Security released (R. 265 RoP,  R 158 RoP) 

IPPT20241227, UPC CFI, LD Düsseldorf, Ona Patents v Google 
€ 500.000 security for costs (R. 158 RoP). There are no apparent financial reserves other than the minimum amount of share capital. Even any financial support from third parties, such as the licensee, is not certain, apart from the question of whether it would be sufficient from a legal point of view. Finally, the Claimant seems to have no other significant assets beside other patents.

IPPT20241227, UPC CFI, CD Paris, Microsoft v Suinno - II
A request for additional security actually amounts to a request to modify the security already granted by increasing its amount (R. 158 RoP). The first two arguments (increasing of costs related to the progression of the written procedure and respondent’s admission in the appeal proceedings of lack of financial resources) constitute new facts that must be considered in the assessment on whether to amend its previous order. The Court is of the view, however, that these circumstances are not such as to require a reassessment of the adequacy of the security already ordered.

IPPT20241227, UPC CFI, CD Paris, Microsoft v Suinno - I
An order granting security for costs (R. 158 RoP) can be revoked or amended by the Court if there is a change in the factual circumstances underlying the order. Granting this opportunity to the parties, even in absence of a specific and direct legal provision, is necessary to render the measure consistent with its purpose, namely to address the risk of non-recovery or significant difficulty in recovering costs of the proceedings. Security amount for costs determined by the “value” of the action which is to reflect the “objective interest pursued” by the claimant at the time of the filing of the action (R. 370.6 RoP) and any subsequent modifications – like a subsequent reduction of damages – is of no relevance

IPPT20241217, UPC CFI, CD Munich, Nanostring v Harvard
Request to release the security rejected (R. 352(2) RoP). The Court has the power to release a security for legal costs and other expenses imposed under Rule 158 RoP on the basis of Rule 352.2 RoP. Despite the absence of a specific provision as part of Rule 158, the Court has the power to release a security on the basis of Rule 352.2 RoP, either directly or, if necessary, by way of analogy. Chapter 6 of the RoP (“Security for Costs”) – in which Rule 158 RoP is placed – does not contain a provision for the release of a security for legal costs and other expenses that has been imposed by the Court on a party. A security should be released when the reasons for imposing the security have ceased to exist. This will generally be the case where a final and non-appealable judgement has removed the possibility of the event for which security was ordered. Further, if the facts and circumstances that led to imposing the security order have materially changed so that the balance of interests is in favour of releasing a security, this can also be a reason to release the security.

IPPT20241126, UPC CFI, LD Munich, GXD-Bio v Myriad
Claimant to provide security of € 112,000 for legal costs and other expenses (Article 69(4) UPCA, R. 158.1 RoP). Based on the undisputed facts, there is legitimate and real concern that a possible cost order might not be recoverable and/or the likelihood that a possible cost order by the UPC may not, or in an unduly burdensome way, be enforceable. There are significant doubts as to whether the Claimant, in the event of losing the proceeding, has sufficient funds for covering Defendants´ recoverable costs of the current lawsuit

IPPT20241203, UPC CFI, LD Düsseldorf, 10x Genomics v Curio Bioscience
Defendant to provide security for legal costs and other expenses to the Claimant in an amount of EUR 200,000. Defendant can also be ordered to provide security for legal costs (R. 158 RoP, Article 69 UPCA). It follows from the above that there is no conflict between Rule 158 RoP, in accordance with which a security may be imposed on a “party”, which includes a defendant, and the UPCA. In particular, there is no conflict with Article 69(4) UPCA, which does not exclude imposing a security on a defendant, and there is also no conflict with Article 56(1) UPCA as Article 69(4) provides the legal basis for a security, which may also be ordered against a defendant. In other words, the RoP comply with the UPCA (cf. Article 41(1) UPCA). Accordingly, the Defendant´s interpretation, on which its admissibility objections are based, is dismissed. In the absence of information on actual costs an amount of  EUR 200,000 is deemed adequate security 

IPPT20241014, UPC CFI, CD Paris, Kinexon v Ballinno
Ballinno ordered to provide security for legal cost of claimant  Kinexon in revocation action (Article 69(4) UPCA, R. 158 RoP). It is not necessary that the party claiming security has the formal position of a defendant in the lawsuit in which it claims security. It only matters whether it reacts to a claim of the other party. Therefore, a party is also defendant in the sense of Art. 69 (4) UPCA if it responds with a revocation action against an application for provisional measures. Irrevocable commitment to the Claimant in the proceedings not to further pursue its infringement case unless and until the Court of Appeal provisionally rules that the method and system, which Kinexon provided to UEFA infringes a valid EP 067 […] does not alter the risk that a possible cost order against Ballinno might not be recoverable by Kinexon and does not change the fact that Kinexon has costs which arise in reaction to Ballinnos application for provisional measures.

IPPT20240927, UPC CFI, CD Paris, Microsoft v Suinno
Suinno to provide security of € 300,000 for legal costs (Article 69(4) UPCA, R. 158 RoP). Undisputed that respondent’s business model is exclusively characterized by the enforcement of patents, namely the patent-in-suit, and asserting corresponding license claims; respondent does not generate sufficient income or other cash flow and no equity capital at all, does not maintain any other business, let alone has any physical assets, and does not even have an own office space.

IPPT20240906, UPC CFI, LD Düsseldorf, Sodastream v Aarke
Request for panel review of dismissal of security for costs by judge-rapporteur dismissed (R. 333.1 RoP, R. 158 RoP)The judge-rapporteur correctly held that, under these principles, neither a financial risk nor a likelihood of unenforceability is presented to the Court. The Claimant, as part of the PepsiCo group, is financially able to comply with a decision on costs. This has not, in any event not sufficiently, been contested by the Defendant. In fact, the Defendant confirms in its Application (par. 6 “no insolvency risk is at hand”.) The fact that the Pepsico group is not a party to these proceedings (par. 29-30 Application) does not mean that the Claimant is unable to comply with a possible decision on costs. 

IPPT20240820, UPC CFI, RD Nordic-Baltic, Edwards v Meril - II
Application for security for legal costs dismissed (Article 69 UPCA, Rule 158 RoP). No indication that the Claimant would lack assets or will to pay costs of the proceedings and other costs incurred (or to be incurred) by Defendants, which the Claimant may have to bear. Nor is there any evidence suggesting that a possible order for costs by the UPC would not, or only in an unduly burdensome way, be enforceable in the United States.

IPPT20240805, UPC CFI, LD Düsseldorf, Sodastream v Aarke
Security for costs dismissed (Rule 158 RoP). Neither a financial risk nor a likelihood of unenforceability is presented to the Court. It is not disputed by the parties that the claimant, as part of the PepsiCo group, is financially able to comply with a decision on costs. The defendant's sole argument that it had doubts as to the claimant's compliance with a decision could not be substantiated by facts. 

IPPT20240730, UPC CFI, LD Vienna, Swarco v Strabag
Intervention admissible on the condition that the intervener deposits a security for costs in the amount of EUR 134.000 with the UPC by 20 August 2024 ((Rule 314 RoP). While Article 69(4) UPCA only provides for the provision of a security for costs by the plaintiff, Rule 158 RoP extends the circle of addressees of such an order to "the parties" and thus also to the intervener if it is admitted. Legal interest in the result of the action requires a direct and present interest in the issuance of the order or decision requested by the supported party, which in any case can be affirmed if it is alleged that the product purchased from the intervener infringes the patent in suit (Rule 313(1) RoP).

IPPT20240521, UPC CFI, LD Paris, ARM v ICPillar
Security for costs of € 400.000 ordered because of potential inability for Claimant to cover the legal costs in case of losing (Article 69(4) UPCA, Rule 158(1) RoP). Factors to be considered when ordering a security order include the financial position of the other party that may give rise to a legitimate and real concern that a possible cost order might not be recoverable and/or the likelihood that a possible cost order by the UPC may not, or in an unduly burdensome way, be enforceable. In the present case, there are no exceptional circumstances that would be considered as unduly burdensome to justify the order. Nor does the mere fact that the Respondent is domiciled in the United States of America justify an order for security for costs. Potential risk of inability to cover the legal costs of the other party in case of losing the litigation. Respondent in its written comments did not provide any indication of its financial situation. Insurance taken out to cover the financial risks is insufficient for two reasons. Firstly, the purpose of this type of insurance is to provide a financial protection for ICPILLAR (the insured party), and not to protect the potential rights of the ARM entities (the applicants of the Security for cost request). Secondly, the full terms of the said insurance have not been disclosed and it is hence unclear what are the actual terms of the insurance.

IPPT20240514, UPC CFI, LD Hamburg, Ballinno v UEFA
Insolvency risk of the plaintiff is the relevant factor for security for costs of a party, not enforcement not enforcement risk in case of an EU domiciled plaintiff (Article 69(4) UPCA, Rule 158(1) RoP). Claimant to provide security for the legal costs of the Defendants in the (total) amount of € 56.000. As the starting point the undisputed facts point into the direction of the argument of the defendants that there is a risk of insolvency of the claimant when it comes to the reimbursement of the costs of the present proceedings. […]. In the present case the Panel has especially considered that the patent in suit was not only just recently assigned to the claimant, but that the transfer was performed months after the assignor entered into a pre-trial correspondence about a possible patent infringement with the defendants 2) and 3). This raises the concern that the purpose of this transfer might be to facilitate this litigation without any financial risk to applicant. 

IPPT20240430, UPC CFI, LD Düsseldorf, 10x Genomics v Curio Bioscience
No security for legal costs of Defendant in urgent proceedings (Article 69(4)) UPCA, Rule 158 RoP, Rule 211.1(d) RoP).

IPPT20240423, UPC CFI, LD Munich, Volkswagen et al. v NST 
Request for security denied: balance of interests in favour of the Plaintiff (Article 69, Rule 158 RoP). Factors to be taken into account when issuing an order for security include the financial position of the other party which may give rise to a legitimate and real concern that a possible order for costs may not be recoverable and/or the likelihood that a possible order for costs by the UPC may not, or in an unduly burdensome way, be enforceable. The imposition of a security for legal costs serves to protect the position and (potential) rights of the defendant, who has not chosen to commence the main proceedings. The protection of the defendant must be balanced against the burden on the claimant caused by an order to provide security. The fact that the Plaintiff has its registered office in a non-EU country, i.e. in the United States, cannot be relevant, as this would be a form of a priori discrimination, based precisely on the nationality of its registered office/domicile, which is not provided for in any source of law.

IPPT20240304, UPC CFI, LD The Hague, Plant-e v Arkyne
Possible for the parties by mutual agreement to establish an “attorneys’ eyes only’’ restricted-access group for confidential information and exclude access by a natural person from each party, provided that fair trial is not affected. (Article 58 UPCA, Rule 262A RoP, Article 9 Trade Secret Directive). Principle of fair trail not likely to be impaired where the confidential information is a side issue (providing security for costs of a party, Rule 158 RoP). Confidential Information:non-public financial information concerning sales and investments is information that is generally considered to be confidential, especially vis-à-vis a competitor.

IPPT20240213, UPC CFI, LD The Hague, Plant-e v Arkyne
Defendant’s request for security for costs (“cautio iudicatum solvi”) rejected (Article 69(4) UPCA; Rule 158 RoP, Article 24 UPCA). Protecting the rights of the defendant should be balanced against the right of the claimant to enforce its patent rights. The main rationale for the cautio is to secure the enforceability of a potential cost order. If such order is directly enforceable after it is granted, it can serve as grounds not to allow a cautio at the start of or during the proceedings. UPC decisions and orders are directly enforceable in the Netherlands in accordance with Art. 82 UPCA, Art. 71d Brussels and R. 354.1 RoP. A cautio in this case is hence not justified because of the risk that a possible cost order in favour of Bioo will not be directly enforceable. This contrasts with the situation decided by the CD Munich [IPPT20231030]  – [....] – on which Bioo relies. In that case the relevant claimant was domiciled outside the EU and no treaty regarding the execution of judgments was in place. As a rule, the court finds that a cautio based solely on (expected) material unenforceability should be awarded in exceptional circumstances only. The court agrees that under the circumstances in the present situation, which involves two competing SMEs with limited finances, the financial strain on the claimant can be a serious impediment to enforcement of its rights and to access to justice, and hence for granting a cautio. Lastly the court takes into consideration that according to Dutch national procedural law it is not possible to give a cautio vis-a-vis plaintiffs domiciled or residing in the Netherlands (and hence in the EU) under any circumstances, and also if there is good reason to doubt the possibility of recovery of a potential cost order due to the financial situation of the claimant.

IPPT20231030, UPC CFI, CD Munich, Nanostring v Harvard

Order to provide security for legal costs and other expenses pursuant to Rule 158.1 RoP to the amount of EUR 300,000. Additional (procedural) burden and uncertainty on the party seeking to enforce a UPC (cost) judgement in the UK compared to other (EU) jurisdictions. This is a factor that weighs in favour of ordering a security. Legitimate concern that the Claimant will not have adequate financial means to cover the legal expenses that it may be liable for. Submitted that the injunction ordered in other case by Munch Local Division would be “existence-threatening”. Claimant has not provided any information as to its own, independent, financial position nor has it pointed at any of its own assets that could be suitable for redress should it be liable for any legal costs. Instead, it relies solely on the cash position of its group of companies. The group, however, in its own words, has never been profitable and therefore relies on money from investors.

IPPT20231020, UPC CFI, LD Helsinki, AIM Sport Vision v Supponor

No security for costs (Rule 158 RoP). No sufficient evidence of  risk of insolvency and evidence indicates that the Applicant will have the financial means to cover any potential legal costs. Not appropriate for the Court of First Instance to order security for the costs of potential future proceedings in the Court of Appeal.

IPPT20230929, UPC CFI, LD Munich, Edwards Lifesciences v Meril

No security for the legal costs and other expenses (Rule 158 RoP) ordered. It requires a showing that the financial circumstances of the other party give rise to fears that any claim for reimbursement of costs cannot be served or that, despite sufficient financial resources, enforcement of a decision on costs appears to be impossible or fraught with particular difficulties. In the United States of America, judgments of foreign courts and the associated cost decisions can generally be recognised and enforced. It has not been submitted or is otherwise apparent that this could be different with decisions and orders of this court or is seriously to be expected. Such a request cannot be made the subject of Preliminary objection (Rule 19 RoP). The possible subjects of a Preliminary objection are exhaustively listed in Rule 19(1) RoP. Motions pursuant to Rule 158(1) RoP are not listed. 

IPPT20230828, UPC CFI, LD Helsinki, AIM Sport Vision v Supponor
Procedural order in main proceedings and provisional measures proceedings concerning issues to be addressed in written submissions, invitation to an oral hearing in front of the whole panel, including a technically qualified judge, and instructions regarding oral hearing.