case law

id : 20335

id: 20335

Warsaw Appellate Court judgment

dated 16 April 2008

Case No. I ACa 1334/07

Summary by arbitraż.laszczuk.pl:

In 2005 “E.-n.” sp. z o.o. brought an arbitration proceeding before the Internet Domains Arbitration Court at the Polish Chamber of Information Technology and Telecommunications against R.F., sole proprietor of an Internet business selling home appliances and electronics, alleging trademark infringement and unfair competition. In 2006 the arbitration court issued an award denying the claim. The claimant filed a petition with the regional court to set aside the award, alleging that the arbitration court had violated the arbitration rules and that the award violated public policy. The regional court denied the petition.

The claimant alleged that the arbitration court had violated the adversary principle by performing its own Google search of the key terms in dispute (“euro” and “rtv”), and reviewing the parties’ websites, before the hearing began and without being requested to do so by the parties. The arbitrators subsequently informed the parties, and they did not object. The claimant also alleged that the award violated public policy by denying trademark protection on the Internet.

The appellate court denied the appeal, finding that the alleged procedural violations did not have a material impact on the decision and that the arbitration court did not deny the claimant trademark protection but merely found that there was little risk of confusion when the claimant traded mainly in brick-and-mortar stores while the respondent traded solely on the Internet.

Excerpts from the text of the court’s ruling:

1. It should be borne in mind that the arbitration court, which is not bound by provisions on procedure before the court (Civil Procedure Code Art. 1184 §2), has greater discretion than in a civil proceeding shaped by the Civil Procedure Code.

2. The arbitration court ... took evidence on its own initiative from the review of the websites and a review of the search capabilities of the Google Internet search engine with respect to the words in dispute ..., without being requested to do by the parties to the proceeding and without citing specific circumstances of the case justifying such initiative by the court, but in the view of the Appellate Court this does not constitute a serious violation of the adversary principle.

3. Taking evidence not in compliance with the rules set forth in Civil Procedure Code Art. 235–237 ... is not equivalent to violation of fundamental rules of procedure within the meaning of Civil Procedure Code Art. 1206 §1(4), which limits the ability to set aside an arbitration award to the principles of a fair trial and procedural violations material enough that they could influence the arbitration award.

4. An arbitration award will also be set aside if the award is contrary to fundamental principles of the legal order of the Republic of Poland. … This does not have to do with internal inconsistency of the form of the ruling, i.e. inconsistency between the specific parts of the ruling. This provision, which is an exception to the rule that when considering a petition to set aside an arbitration award, the state court generally does not review the resolution by the arbitration court on the merits, and in particular does not review whether the award is founded on the facts cited in the justification or whether such facts were correctly determined (as it is undisputed that arbitrators should have greater discretion than a state court in interpreting and applying the law), restricts substantive review of arbitration court rulings only to instances of violation of the principles of the legal order, i.e. instances where the effects of the arbitration court ruling would cause a material violation of such principles, which should be understood to mean the principles of the political and socioeconomic system. This means that the state court proper to consider the petition may not consider the substantive side of the dispute..., and an allegation of violation of specific provisions of substantive law may be effective only insofar as the violation of specific norms also violates the principles of the legal order.

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