The Supreme Court has upheld the legal position of ART DE LEX in the case of Korea Aerospace

A judge of the Supreme Court of the Russian Federation (SC RF), G. G. Popova, hearing the cassation appeal in accordance with the rules of “the second cassation,” upheld the Intellectual Property Court (IPC) ruling on the illegality of earlier judicial decisions that had awarded Penzenskoye Konstruktorskoye Byuro Modelirovaniya (PKBM) damages in the amount of approximately USD 50 million from the two Korean companies PKBM had accused of violating exclusive rights–Korea Aerospace Industries, Ltd., and Doosan Infracore, Ltd. (case no. A40-56928/2004). The database of arbitrazh court acts recently published the judicial act of the SC RF.

There can be no further challenges to the IPC ruling, according to recent amendments to the Arbitrazh Procedural Code, unless the chief justice of the Supreme Court or his deputies initiate them. The rehearing in the court of the first instance will begin on 2 December 2014.

The ten-year dispute between PKBM and Korea Aerospace Industries, Ltd., is over exclusive rights regarding flight simulators. In the middle of the 1990s, another Korean company, which is not a party in the case, concluded a number of cooperation agreements with the PKBM regulating the interaction and foundations of the companies’ joint activities.

In 2004, PKBM initiated a case before the Moscow Arbitrazh Court for the recovery of damages in the amount of USD 50 million from Korea Aerospace Industries, Ltd., and Doosan Infracore, Ltd.

The court of first instance decided against only one defendant, Korea Aerospace Industries, Ltd. The Appellate Court, however, overturned the judicial award and obliged both codefendants to pay the damages jointly. Afterward, the IPC, acting as a court of cassation, overturned the judicial findings and forwarded the case for reconsideration. The IPC took into account the defendants’ arguments as well as the alleged violation and its consequences. The presentation of the representatives of Korea Aerospace was significant in determining the outcome.

PKBM disagreed with the IPC ruling and challenged it in the Judicial Chamber of the Supreme Court of the Russian Federation on Economic Disputes (the Judicial Chamber), relying on the rules of “the second cassation.” PKBM claimed that the court had erred in interpreting and applying both substantive and procedural law.

The Supreme Court, in its ruling of 7 October 2014, concluded that there were no grounds for initiating a cassation appeal in the Judicial Chamber. As stated in the judicial finding, the arguments in the complaint did not support the claim that the IPC had violated the law.

For information about the finding of the IPC, see the 25 July 2014 posting on this website at http://artdelex.ru/eng/news/ipc-overturns-arbitrazh-decision-in-flight-simulator-software-case.