Copyright 2008 by The American Law Institute. Reproduced with permission. All rights reserved.
INTELLECTUAL PROPERTY:
PRINCIPLES GOVERNING JURISDICTION, CHOICE OF LAW,
AND JUDGMENTS IN
TRANSNATIONAL DISPUTES
(with Comments and Reporters’ Notes)
Part III
APPLICABLE LAW
Chapter 1
In General
§ 301. Territoriality
Except as provided in §§ 302 and 321-323,
(1) The law applicable to determine the existence, validity, duration, attributes, and
infringement of intellectual property rights and the remedies for their infringement is:
(a) for registered rights, the law of each State of registration.
(b) for other intellectual property rights, the law of each State for which protection
is sought.
(2) The law applicable to a noncontractual obligation arising out of an act of unfair
competition is the law of each State in which direct and substantial damage results or is
likely to result, irrespective of the State or States in which the act giving rise to the
damage occurred.
Comment:
a. Definitions. Rights “exist” in a particular territory if that State recognizes the right at
all, for example, whether it accords an exclusive right to display copyrighted works. The
“attributes” of the right concern its content, for example, whether the display right extends to
private as well as public displays, or whether it is limited to certain kinds of displays, such as
via transmissions.
b. State of registration. The State of registration is the State of the registration of the
right at issue in the litigation, such as the patent, design or model right, trademark right, plant
variety, semiconductor topographies rights, or geographical indications. The law of this State
also governs any formalities of recordation and maintenance.
c. Other rights. Other intellectual property rights, whether or not registered, do not arise
out of registration. These include copyright and neighboring rights, which arise out of the act
of creation or performance; common-law trademarks and commercial-name rights, which in
some States may arise out of adoption and use; and right of publicity (or right to one’s image).
As to these rights, registration is not a relevant point of attachment, either because there has
been no registration, or because registration neither creates nor determines the rights at issue.
The usual point of attachment for determining infringement of these rights therefore will be
the countries where the right owner’s market for the work has been affected. Finally, this
formulation covers artists’ resale rights (droit de suite), where the availability of relief
depends on the territory in which a work of art (or, in some places, a manuscript) is sold.
d. Point of attachment for law applicable to infringement of other rights. The Principles
follow a territorial approach in instructing courts to apply the laws of each State for which the
moving party seeks protection. By eschewing the formulation “country where protection is
sought,” the Principles endeavor to distinguish and disqualify application of the forum’s law
when the sole basis for applying forum law is the bringing of the lawsuit there; see § 103(1).
Moreover, the formulation “law of the country where protection is sought” is unclear: it might
mean that the lex fori applies or that the lex loci delicti applies. The formulation “each
country for which protection is sought” is compatible with a market-oriented approach; it
corresponds to the markets that plaintiff seeks to protect from infringements that are occurring
(or threatened to occur) there. In the case of an unauthorized transmission by satellite or
Internet, for example, the infringement may occur in each of the States of receipt, but the right
holder may confine its claims to those locations that constitute the significant markets for the
work. Finally, the formulation covers declaratory-judgment actions, in which a party seeks a
declaration that its activities do not infringe intellectual property rights in that State.
e. Rights of publicity. Section 301(2) includes rights of publicity (or rights to one’s
image). This provision departs from a choice-of-law rule that treats rights of publicity like
rights of privacy and looks to the law of the residence at the time of creation or at the place of
residence at the time of death. The better view is to consider the right of publicity as an
economic rather than a personal right, because its essence is to control exploitation. By
contrast, privacy rights, which are not covered by the Principles, seek to prevent intrusion.
Illustration:
1. An advertisement is broadcast in the United States and Canada using a picture of the
United Kingdom’s Prince Charming without his permission. Prince Charming sues for
violation of his right of publicity.
Although the United Kingdom does not recognize rights of publicity, the claim will be
governed by U.S. and Canadian laws.
f. Moral rights. The Principles do not propose a special point of attachment for disputes
involving moral rights. Thus, the general approach applies.
Illustration:
2. A is the ghostwriter for a book published under B’s name. A signed a contract
relinquishing attribution rights. The contract does not specify applicable law. The book is
distributed in Xandia and in Patria. In Xandia, contracts waiving authorship attribution are
permissible; in Patria, they are not. A subsequently brings an action against the publisher
demanding that her name appear on the books.
Applying the general rule designating the laws of the States for which protection is
sought, A will have a claim in Patria, but not in Xandia.
g. Unfair competition. Many States entertain these claims together with claims of
violations of intellectual property rights such as trademarks, tradenames, or neighboring
rights. Thus, it makes sense for the same or similar choice-of-law rules to apply to the entire
dispute. The characterization of an act as violating an intellectual property right, or as giving
rise to an unfair-competition claim, may vary from State to State. The protection of trade
secrets and of databases not covered by copyright furnishes examples of such subject matter.
The Principles recognize that acts in one State may affect competition in another location. In
such cases, the law of the place where competition is taking place should accordingly apply.
Illustration:
3. A develops a customer list in Patria, keeps it secret, and agrees to license it to B in
Xandia. On the way to delivering it to B, A stops in Tertia, where C acquires and uses (but
does not publish) the customer list without A’s consent. Tertia does not recognize this
material as a protectable trade secret.
If harm occurred to A’s or B’s commercial interests only in Tertia, Tertia’s law will
apply, and no protection is available. If, however, C also exploits the list in other jurisdictions
(for example, where the listed customers are located) and A or B suffers direct and substantial
damage there, then the laws of those jurisdictions will also apply, and damages may be
awarded for those jurisdictions whose laws recognize the trade-secret status of customer lists.
h. Facilitation of infringement. An increasing number of transnational intellectual
property controversies concern the acts of persons or enterprises that facilitate infringement,
rather than (or in addition to) the acts of the end user/direct infringers. In some States,
facilitation (or “authorization”) of infringement may itself be an infringing act, distinct from
the infringements committed by those benefiting from the facilitator’s assistance. In such
cases, the law that governs the determination of primary infringement applies.
Illustration:
4. Grumpster.com distributes from the State of Chaos peer-to-peer file-sharing software
to users around the world. Grumpster.com helps users locate files on other users’ computers;
Grumpster.com does not carry any music or motion-picture content on its own website. Users
seeking to copy music or movie files contact the Grumpster.com site to acquire the software
and to initiate their searches for other file-sharers. The offering or copying of files from one
user’s computer to another’s infringes the rights of the copied works’ copyright holders.
The copyright holders may have two claims. One is for facilitating infringing
downloads in Chaos. This is determined by the law of Chaos, which may characterize the
facilitation as a direct infringement, or as a basis for secondary liability. The other claim is for
facilitating downloads outside of Chaos, which is determined by the laws of the States in
which the unauthorized end uses occur. Whether the basis of liability in those States is direct
or indirect will depend on those States’ characterizations.
i. Remedies. The Principles require courts to apply the remedies available under the
applicable law, even if that remedy would be unavailable under forum law. This situation is to
be distinguished from the case in which a court cannot order a remedy because the mechanism
for implementing it is not available under forum law. It should also be distinguished from
cases involving acts occurring in multiple jurisdictions in which a remedy cannot be awarded
for a given jurisdiction because the intellectual property right at issue has not been violated
(or does not exist) in that jurisdiction. Finally, when devising means of redress, the court
should have particular regard to the ability to secure enforcement of those remedies in the
other jurisdictions concerned.
Illustrations:
5. A, a resident of Patria, and B, a resident of Xandia, enter into a licensing agreement
governed by the law of Patria requiring B to make milestone payments for use of A’s patented
research tool. B does not make the payments required, and A sues B in Xandia. The remedy
law of Patria allows for periodic payments.
Even if the only form of relief in Xandia is a lump-sum payment, a Xandian court
should grant the relief requested by A under Patrian law, which governs the agreement.
However, if Xandia lacks a mechanism to supervise periodic payments, Xandia can refuse to
grant that relief.
6. Database producer A sues B, a competitor that has systematically copied information
out of A’s database. B distributes its database in Patria, Xandia, and Tertia. The latter two
countries provide for sui generis protection of databases against the systematic extraction of
substantial portions of their contents. Patria does not. B’s copying does not amount to
copyright infringement under any of these countries’ laws. Thus, B has not violated any
intellectual property rights in Patria.
No accounting for profits should be ordered with respect to B’s sales in Patria. But
because B’s sales in Xandia and Tertia violate those countries’ sui generis protections, A
should be able to obtain relief against B under the laws of Xandia and Tertia.
In some cases, the lack of remedial procedure may present challenges when another
State’s court is asked to enforce the judgment. See §§ 411-413.
REPORTERS’ NOTES
1. Territoriality. Scholarship exemplifies the debate prompted by the pressure that the
pervasiveness of digital communications puts on traditional choice-of-law rules. Compare
Andreas P. Reindl, Choosing Law in Cyberspace: Copyright Conflicts on Global Networks,
19 Mich. J. Int’l. L. 799 (1998) (favoring application of a single law to certain worldwide
disseminations) with Graeme W. Austin, Domestic Laws and Foreign Rights: Choice of Law
in Transnational Copyright Infringement Litigation, 23 Colum.-VLA J.L. & Arts 1 (1999)
(advocating the application of a multitude of laws to worldwide infringement actions);
Graeme W. Austin, Social Policy Choices and Choice of Law for Copyright Infringement in
Cyberspace, 79 Or. L. Rev. 575 (2000) (addressing the social-policy issues involved in the
debate surrounding “single governing law” approaches to transnational infringement cases);
Graeme W. Austin, Valuing “Domestic Self-Determination” in International Intellectual
Property Jurisprudence, 77 Chi.-Kent L. Rev. 1155 (2002) (addressing related sovereignty
issues).
2. Characterization of connecting factors. The international conventions on intellectual
property, when applicable, do not characterize with certainty the connecting factor or factors,
nor do they, as a general matter, clearly set forth a choice-of-law approach. For example,
although art. 5(2) of the Berne Convention states that “the extent of protection, as well as the
means of redress afforded to the author to protect his rights, shall be governed exclusively by
the laws of the country where protection is claimed,” many scholars contend that art. 5(2) of
the Berne Convention should not be construed as a rule on conflicts of law. See, e.g., Roberto
Mastroianni, Diritto Internazionale e Diritto d’Autore 390-397 (1997); François Dessemontet,
Conflict of Laws for Intellectual Property in Cyberspace, 18 J. Int’l Arb. 487, 489 (2001)
(“Article 5(2) of the Berne Convention is a rule on the treatment of foreigners, rather than a
rule on conflicts of law.”) and Maria Martin-Prat, Jane Ginsburg, Shira Perlmutter, & Graeme
Dinwoodie, Commentary and Panel Discussion on Choice of Law, in 7 International
Intellectual Property Law and Policy 99-1 (Hugh C. Hansen ed., 2002). For an extensive
rebuttal of the characterization of art. 5(2) of the Berne Convention as a choice-of-law rule,
see Mireille van Eechoud, Choice of Law in Copyright and Related Rights: Alternatives to the
Lex Protectionis, 106-110 (2003).
Article 5(2), moreover, is unclear as to the precise characterization of the connecting
factor, i.e., “where protection is claimed,” especially when the infringement is committed on
the Internet, and also as to the exact scope of the applicable law. For example, the reference to
the country “where” protection is claimed could mean the substantive or the conflicts law of
the forum State, or it could mean the substantive law of the country (or countries) “for which”
protection is claimed. As an example, suppose a copyright infringement suit is brought in the
United States regarding an unauthorized transmission from Canada of a U.S. work, received
in France. “[T]he country where protection is claimed” in this instance might mean the lex
loci delicti, which, in turn, might mean the place(s) of commission/initiation of the
infringement (Canada), or the place(s) of its impact (France). Alternatively, “where protection
is claimed” might mean the lex fori, the law of the forum State where the action is brought
(the United States). In other words, even if the Berne Convention purported to announce
choice-of-law rules, the disagreement as to what those rules are counsels clear enunciation of
choice-of-law rules in these Principles.
Art. 8(1) of the EC Rome II Regulation designates that for intellectual property rights
other than a “unitary Community intellectual property right,” “the law of the country for
which protection is claimed” controls infringement (emphasis added). The same approach is
taken here.
3. Moral rights. A principle designating the author’s residence as the point of
attachment for moral rights was considered, on the ground that a personal point of attachment
was consistent with the personal nature of moral rights. Nonetheless, it was rejected as
impractical. First, countries that enforce foreign authors’ moral rights are likely to continue to
do so under their public policies or mandatory rules; see Court de cassation, première
chamber civile [Cass. 1e civ.], May 28, 1991, Bull. civ. I, No. 172 (Huston v. La Cinq) (Fr.).
Thus, the law of the country for which protection is sought is likely to apply, one way or
another. Second, having the law follow the residence of the author can create problems for
exploiters whose conduct with respect to the work may be permissible at one point in time,
but impermissible later, when the author changes residence.
4. Unfair competition. The text of the provision applies the substance of the solution
found in art. 99 § 2(2) of the Belgian Code of Private International Law (“l’État sur le
territoire duquel le dommage est survenu ou menace de survenir” [territory where damage
occurred or threatens to occur]).
On divergent protection of databases (not covered by copyright), compare Council
Directive 96/9/EC of 11 March 1996 on the Legal Protection of Databases, arts. 7-11, 1996
O.J. (L 77) 20, available at http://eur-lex.europa.eu/LexUriServ/LexUriServ.
do?uri=CELEX:31996L0009:EN:HTML (last visited Jan. 3, 2008) with Bundesgesetz gegen
den unlauteren Wettbewerb [UWG], Loi fédérale contre la concurrence déloyale [LCD]
[Federal Law on Unfair Competition] Dec. 19, 1986, SR 241, RS 241, art. 5(c) (Switz.),
available at http://www.admin.ch/ch/d/sr/c241.html (last visited Jan. 3, 2008) (in German);
http://www.admin.ch/ch/f/rs/c241.html (last visited Jan. 3, 2008) (in French);
http://www.wipo.int/clea/docs_new/pdf/en/ch/ch016en.pdf (last visited Jan. 3, 2008) (English
translation). Regarding phonograms, see Geneva Convention for the Protection of Producers
of Phonograms Against Unauthorized Duplication of Their Phonograms art. 3, Oct. 29, 1971,
866 U.N.T.S. 67, available at http://www.wipo.int/treaties/en/ip/phono
grams/trtdocs_wo023.html (last visited Jan. 3, 2008) (allowing member States to protect
against unauthorized reproduction of phonograms by means of copyright or neighboring
rights, or through an unfair-competition claim).
5. Rights of publicity. The Principles’ choice of law for rights of publicity is
inconsistent with the choice of law applied in U.S. cases; see, e.g., Cairns v. Franklin Mint
Co., 292 F.3d 1139, 1149 (9th Cir. 2002) (applying the law of the plaintiff’s domicile);
Rogers v. Grimaldi, 875 F.2d 994, 1002 (2d Cir. 1989) (same); Bi-Rite Enterprises, Inc. v.
Button Master, 555 F. Supp. 1188, 1197 (S.D.N.Y. 1983) same; Southeast Bank, N.A. v.
Lawrence, 489 N.E.2d 744, 745 (N.Y. 1985) (same). The genesis of this rule, which mirrors
the choice-of-law approach to privacy claims, probably lies in the U.S. right of publicity’s
initial conception as a facet of the right of privacy, in William Prosser’s formulation, W. Page
Keeton et al., Prosser and Keeton on the Law of Torts § 117 (5th ed. 1984). Although
plaintiff’s reputation may be harmed where the plaintiff lives, the right of publicity protects an
economic interest. Thus, the rule expressed here follows the general rule for other intellectual
property rights. For example, in Illustration 1, following the U.S. rule would deny Prince
Charming the ability to control the economic exploitation of his name and image, even in
countries where those rights are recognized.
With respect to enforcement in a State that does not recognize the right of publicity of a
foreign judgment awarding damages for violation of the right of publicity, see § 403,
Comment c and Illustration 2.
6. Facilitation of infringement. Different jurisdictions may consider acts of facilitation
of infringement as giving rise to derivative liability; others may deem those acts torts in their
own right, see, e.g., Moorhouse v. University of New South Wales (1976) R.P.C. 151 (H.C.
Austl. 1975); Universal Music Australia Pty Ltd v Sharman License Holdings Ltd. (2005)
F.C.A. 1242 (Austl.); and still other jurisdictions may rule some kinds of facilitation
independently tortious, but subject others to a secondary- liability analysis. Compare 17
U.S.C. § 1201(b) (direct liability for trafficking in devices primarily designed to circumvent
technological protection measures) with Sony Corp. of Am. v. Universal City Studios Inc.,
464 U.S. 417, 456 (1984) (no secondary liability for sale of devices that facilitate
infringement if devices are capable of substantial noninfringing uses). Moreover, among (or
within) jurisdictions that characterize facilitation as a form of secondary liability, the standard
for establishing a violation may vary. Compare the analysis of Sony in Metro-Goldwyn-
Mayer Studios Inc. v. Grokster, Ltd., 125 S. Ct. 2764, 2787 (2005) (Breyer, J., concurring)
(capacity for substantial noninfringing use met even if substantial majority of uses are
infringing) with id. at 2783 (Ginsburg, J., concurring) (defendant must show there are in fact
substantial noninfringing uses). For a decision applying the law of the end-user’s State to acts
occurring elsewhere, see MEMC Electronic Materials, Inc. v. Mitsubishi Materials Silicon
Corp., 420 F.3d 1369 (Fed. Cir. 2005) (manufacture and sale in Japan of patented silicon
technology may be considered “inducement” under U.S. law when ultimate customers were
located in the United States).
§ 302. Agreements Pertaining to Choice of Law
(1) Subject to the other provisions of this Section, the parties may agree at any time,
including after a dispute arises, to designate a law that will govern all or part of their
dispute.
(2) The parties may not choose the law that will govern the following issues:
(a) the validity and maintenance of registered rights;
(b) the existence, attributes, transferability, and duration of rights, whether or not
registered; and
(c) formal requirements for recording assignments and licenses.
(3) Any choice-of-law agreement under subsection (1) may not adversely affect the rights
of third parties.
(4) (a) Except as provided in subsection (5), a choice-of-law agreement is valid if
it is valid under the designated law.
(b) Capacity of a party to enter into the agreement is determined by the internal
law of the State in which that party was resident at the time the agreement was
concluded; if that party had more than one residence, capacity will be recognized if it
existed under the law of any one of its residences.
(5) (a) In addition, choice-of-law clauses in standard form agreements are valid
only if the choice-of-law clause was reasonable and readily accessible to the nondrafting
party at the time the agreement was concluded, and is available for subsequent
reference by the court and the parties.
(b) Reasonableness under subsection (a) is determined in light of:
(i) the closeness of the connection between the parties, the substance of the agreement,
and the State whose law is chosen, and
(ii) the parties’ residences, interests, and resources, taking particular account of the
resources and sophistication of the nondrafting party.
(6) If the choice-of-law clause is not valid under this Section, the applicable law is
determined according to the other provisions of Part III.
Comment:
a. Scope of the rule. The Principles are premised on party autonomy with respect to
choice of court (§ 202), and with respect to contractual allocation of ownership rights
(§§ 311-313), but not all questions can be determined by a law chosen by the parties. In
general, the public-law aspects of intellectual property must be adjudicated under the laws
that give rise to the rights in each jurisdiction concerned. These include the mandatory nature
of administrative procedures and fees to obtain or maintain registered rights, the validity of
registered rights, and the formal requirements for recording assignments and licenses. These
also encompass the existence, attributes (specific content), transferability, and duration of
rights (whether or not registered). In addition, if portions of the dispute are not appropriate for
resolution under the law chosen by the parties, the court should nonetheless give effect to that
choice for those issues that are amenable to such resolution. Further, as a consequence of §
302(3), the law applicable to the effect on persons not parties to assignments or licensing
agreements cannot be elected by the parties to those agreements.
Illustration:
1. A and B enter into an agreement to distribute photographs produced by A through a
purely mechanical process without human intervention. The threshold for copyrightability in
Patria is extremely low; A’s photographs would therefore be protectable in Patria. Xandia and
Tertia, however, require a level of originality that A’s photographs do not meet. A and B
agree that Patrian law will apply to the photographs in all countries of distribution, including
Xandia and Tertia.
If C, who is not a party to the contract, reproduces and distributes the photographs in
Xandia, Xandia’s law will apply (and no infringement will be found) because A’s and B’s
agreement does not affect third parties. If B stops paying royalties to A for B’s exploitation of
the photographs in Xandia and Tertia, A’s copyright infringement claim will fail because the
A-B agreement cannot create intellectual property protection in jurisdictions where none
exists. But A may claim remedies for breach of contract.
The parties may validly choose a single law to adjudicate claims deriving from alleged
infringements. For example, if several States are impacted by an alleged infringement, the
parties may elect to apply the law of one State to compute damages for all infringing acts.
Illustration:
2. Same facts as above, except that A’s photographs meet minimum originality
standards in all three jurisdictions. The parties may choose Patria’s law to adjudicate A’s
damages claim against B, but, absent a valid agreement with C, not against C.
b. Choice-of-law clauses. These Principles recognize the freedom of the parties to select
the law applicable to their transaction when transferring ownership or licensing rights in
intellectual property. The principle of unfettered party autonomy is widely recognized in
business-to-business transactions. It admits the choice of a third legal order, not being that of
the grantor or of the recipient, even when the chosen law lacks any relationship to the parties,
to the right, or to the territory of use. Indeed, the chosen law could be “soft law” such as the
UNIDROIT Principles for international commercial contracts. This freedom goes together
with the freedom to select a court (or an arbitration tribunal) sitting in a third State and
instructed by the parties to apply the law chosen by them, which will often be the law of the
place of dispute resolution.
A contractual relationship between the parties in cases of infringement may be rare.
Nonetheless, if there is a preexisting relationship, the parties may validly enter into a
negotiated choice-of-law agreement before the dispute arises. Moreover, after the litigation
begins, the parties should also have the ability to enter into contracts that simplify resolution
of their dispute and make outcomes more predictable. In cases that cannot settle because the
parties cannot agree on the facts or the application of law to the facts, the opportunity to try
the case under an agreed law allows a court to clarify the disputed issues expeditiously. The
claim is most likely to be resolved expeditiously if the parties agree that the court will apply
its own law.
It can be argued that this choice derogates from the sovereign interests of the States
whose law would otherwise be applied. However, those interests are mainly related to the
validity of registered rights and other public-law issues, which are not subject to this
provision. Further, if policies in a State expressed through substantive rules are so strongly
held that they would be outcome-determinative, it seems unlikely that a litigant disfavored by
those rules would agree to their application in a negotiated agreement. A standard form
choice-of-law agreement will be enforced only to the extent it is reasonable, under the
considerations set out in § 302(5). Finally, the interests of the States are protected by §§ 322-
323 on public policy and mandatory rules. Recognition and enforcement of the judgment are
also subject to the safeguards of §§ 401-413.
c. Effect on third parties: The Principles’ commitment to party autonomy does not
permit the parties to choose law that affects the rights of others. Third-party rights could arise
in the context of sublicenses or of security interests, see § 317.
d. Capacity and validity. The Principles apply similar safeguards for choice-of-law and
choice-of-forum clauses. See § 202(3) and (4) and Comments c, d, and g, and REPORTERS’
NOTES 2 and 3.
REPORTERS’ NOTES
1. Party autonomy generally. Party autonomy is an important value undergirding these
Principles. This approach is consistent with evolving international norms. For example, Rome
Convention art. 3 poses a general principle of party autonomy. The increasing amenability
over the last 30 years of intellectual property issues to arbitration; see, e.g., 35 U.S.C. § 294
(rendering “valid” and “enforceable” clauses for “[v]oluntary arbitration” of “any dispute
relating to patent validity or infringement arising under [a] contract”), demonstrates that some
States now are willing to commit to party autonomy intellectual property disputes whose
resolution the State previously confined to courts in that State. The danger of selecting a law
disproportionately favorable to one party is reduced because of the close scrutiny to which the
Principles subject any standard form agreement.
Limitations on the freedom of the parties derive from the scope of the issues to be
adjudicated under the applicable law. Competition law, currency regulations, protection of
consumers, product liability, or transferability restrictions under domestic intellectual property
law cannot be contracted away by the parties through a choice-of-law agreement. The law
chosen by the parties applies to contractual issues such as the common will and intent of the
parties, its existence, its interpretation, its effects, avoidance and termination of the contract,
warranties and guarantees, consequences of a material breach such as the duty to put the other
party on notice to remedy it, contractual damages and accounting for lost profits,
confidentiality, best-efforts clause, or the status of affiliated companies and subsidiaries.
2. Infringement actions. Under the Principles, the parties may choose the law applicable
to an infringement action after the dispute arises. Recent codifications of private international
law accept this notion. See, e.g., Swiss Law on Private International Law art. 110(3); Belgian
Code of Private International Law art. 104(2) (for quasi-contractual relations). However,
Rome II, while it poses a general rule permitting the parties to a dispute to choose the
applicable law, art. 14 precludes party autonomy for intellectual property infringement
actions; see id. art. 8(3). The Principles do not follow the Rome II approach because
efficiency interests are better served by allowing the parties to agree among themselves on the
law that will determine what will usually be the monetary consequences of their conduct.
Injunctive relief brings the public policies of the affected States more closely to the fore, but
the Principles’ preservation of local mandatory rules (see § 323) allows a court to take those
interests into account notwithstanding the otherwise applicable law. See also §§ 403(1)(e) and
412(1)(b).