THE BUSINESS DIVISION OF THE COURT OF MILAN DECLARES ITS COMPETENCE IN THE FIELD OF FRANCHISING
With decision published on November 28, 2017, the Court of Milan – business division – ruled in favor of the plaintiff, rejecting among others the exception of territorial incompetence of the defendants.
The present judgment has been rendered at the end of a dispute deriving from the conclusion of a franchising agreement between the defendants and the plaintiff. The plaintiff, in particular, complained that the franchisee had continued to use, for at least two months, its distinctive signs, despite the fact that the agreement was terminated due to breach, by the franchisee itself, of the obligation to pay the amount due. For these reasons, the franchisor summoned the counterparty requesting, in addition to the order of payment of the not paid sum, also the order to pay a consistent amount as a penalty for the unlawful use of the plaintiff’s distinctive signs.
In this scenario, the appealed Court of Milan, business division, rejected the preliminary exception of incompetence raised by the defendant, underlining the existence of the competence of the business divisions in a dispute concerning a franchising agreement, when it does not only concern the execution of the contract, but also the exercise of industrial property rights, or the unlawful use of registered exclusive rights. In this case, the Milanese judges pointed out, the IP infringement attracts the competence on the request for fulfilment of the contract with regard to the payment due, with consequent application of the criteria indicated by Legislative Decree no. n. 30/2005 and following amendments.