(CN) - A dispute between EU executives and translation software developer Systran should have been fought in the national courts, an adviser to the EU's high court said.
Systran and the European Commission have a long history going back to 1975, when U.S.-based World Translation Center developed and installed English-French translation software called Systran for the regulatory body. France's Gachot later acquired the U.S. company and renamed it Systran SA.
From 1976 through 1991 - and enhanced by a 1987 agreement improving the system to include present and future EU languages - Systran provided translation software used by the commission.
In 1997, Systran agreed to migration agreements that allowed the software to operate on UNIX and Windows platforms.
But when the commission opened bidding for maintenance and enhancement of the system in 2003, Systran said such workwould likely infringe on its intellectual property rights. The commission disagreed and awarded two of eight contracts to Gosselies SA.
Systran sued the commission for copyright infringement in the EU General Court. After deciding that the dispute was not contractual in nature, ensuring jurisdiction, the court awarded Systran nearly $16 million for what it called a "serious breach" of noncontractual liability.
The commission appealed to the Court of Justice, claiming that the dispute relied on a series of written agreements and other mail exchanges, and that the lower court broke its own rules by involving itself in a contract fight.
An adviser to the high court agreed Thursday.
"The approach followed by the General Court led it to make an error in law in its examination of the relationships which were established, in a very marked contractual context, between the commission and the various companies in the Systran group which have developed or contributed to the development of the various versions of the Systran software," Advocate General Cruz Villalon said in a statement. "Therefore, the General Court wrongly declared itself as having jurisdiction to hear and determine the action for compensation for the damage allegedly caused to Systran by the Commission's conduct."
The high court should find that the lower court had no jurisdiction in the case, and then refer the matter to the appropriate national courts, Villalon said.
If the high court decides that the General Court had jurisdiction, the adviser said the commission should prevail on several points.
"This applies, in particular, to the argument according to which the General Court erred in finding that the directive on copyright, concerning acts not requiring authorization by the rightholder, was intended to apply only to works carried out by the legitimate acquirer of the program and not to works entrusted to a third party acquirer," according to the statement about Villalon's opinion. "The commission was also correct to argue that the General Court had erred in law in concluding there was a causal link without examining whether Systran had shown reasonable diligence in preventing or limiting its loss or damage."
Villalon opined that the lower court also erred in finding "a sufficiently direct and immediate casual link between the commission's alleged conduct and the various components of the damage alleged by the companies." It also failed to give sufficient reasons for awarding $6 million in supplementary damages to Systran, he added.
Ironically, the Court of Justice did not make its opinion available in English.
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