Directors’ liability in case of patent infringement
A significant ruling by the UPC Court of Appeal defines when a director’s conduct may give rise to personal liability for acts of patent infringement committed by the company they manage.
On 3 October 2025, the Court of Appeal of the Unified Patent Court (UPC) delivered a landmark decision in Koninklijke Philips N.V. v. Belkin Companies, addressing whether, and under what conditions, managing directors can be personally liable for patent infringements committed by their companies.
In summary:
- the UPC Court of Appeal has clarified the boundaries of directors’ personal liability in cases of patent infringement;
- the mere role in the board does not automatically entail personal liability for directors;
- direct liability arises only in cases of conscious or intentional conduct by the directors;
- negligent conduct, when lacking awareness or intent, is not sufficient to establish personal liability.
Background
Philips had sued several Belkin group companies and their managing directors for infringement of European Patent EP 2 867 997, seeking injunctive relief and damages.
The Munich Local Division issued a first instance decision holding the companies liable and considered the directors as “intermediaries” under Article 63 UPCA, ordering them to refrain from managing the companies in a way that led to further infringement. Both the companies and the directors appealed.
Decision
The Court of Appeal fully upheld the directors’ appeal, setting aside the Local Division’s decision insofar as it concerned them, and dismissing all claims against them.
In particular, the Court held that the notion of an “infringer” under the UPCA includes those who directly commit or knowingly contribute to infringement, but it does not automatically extend to directors. The mere status of managing director is not enough to automatically trigger personal liability; this latter arises only where the director’s conduct goes beyond ordinary management duties, for instance where:
- the director uses the company deliberately to commit infringement, or
- the director knows about the infringement and fails to act despite being in a position to prevent it.
Furthermore, the decision of the Court clarifies that directors who seek and rely on qualified legal advice may do so safely until a judgment by a first instance Court establishes the company’s infringement.
Finally, directors cannot be considered “intermediaries” under Article 63 UPCA, since such provision applies to third-party service providers, not corporate officers. In particular, the Court ruled that the directors of a company cannot be considered “third parties” with respect to such company.
Implications
This decision provides valuable guidance for corporate governance and patent litigation under the UPC:
- it delineates the limits of directors’ personal liability;
- clarifies the distinction between management decisions and personal participation in infringement;
- reinforces the importance of legal advice and compliance procedures in patent matters.
Ultimately, the UPC Court of Appeal confirms that personal liability of the directors of a company infringing a patent requires awareness and intent — and not mere participation in the Board of Directors.
The UPC Court of Appeal’s ruling provides valuable guidance not only from a legal standpoint but also for practical corporate governance.
In light of the Court’s reasoning, boards of directors should take proactive steps to strengthen their IP risk management and compliance frameworks, by:
- formalizing internal IP compliance procedures,
- assessing and documenting any decisions involving potential infringement risk,
- seeking specialized legal advice where uncertainty arises, to mitigate exposure to findings of conscious or intentional conduct.
A robust governance structure, supported by experienced counsel, remains the most effective safeguard against potential personal liability under the UPC framework.
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