(Yicai) Nov. 13 -- A Dutch court has overturned the evidence seizure order  Jaguar Land Rover had obtained against BYD and ordered the British carmaker to arrange for the destruction or return of the seized materials, marking a setback for Jaguar Land Rover in its ongoing intellectual property dispute with the Chinese auto manufacturer.

In its procedural ruling published on Nov. 11, the District Court of The Hague cited Article 705, paragraph 2 of the Dutch Code of Civil Procedure (Rv), and found that the seized materials were not necessary to establish whether BYD’s Ti7 infringed Jaguar Land Rover’s intellectual property rights.

The court also noted that both parties acknowledged that the Ti7 had not yet been sold in the European Union. Coventry-based Jaguar Land Rover had therefore failed to demonstrate that it had suffered market losses. The possibility of future infringement was not sufficient grounds for obtaining evidence at this stage.

On this basis, the court found that maintaining the seizure was unnecessary and that Jaguar Land Rover’s claim for damages appeared, on initial observation, unsubstantiated.

In August, Jaguar Land Rover alleged that BYD’s Ti7 infringed the EU design rights tied to its Defender model designation L663, and applied to a Dutch court for an order to preserve evidence.

On Aug. 24, bailiffs carried out the seizure at BYD's European headquarters and two Dutch offices in Schiedam and Hoofddorp. The materials taken reportedly included Ti7 launch plans, technical data, financial information and BYD's internal research records relating to the Defender, according to local media reports.

Under the ruling, Jaguar Land Rover must instruct the bailiff or judicial custodian to destroy the seized materials within 24 hours of formal service of the judgment. It must then provide Shenzhen-based BYD with confirmation of the materials' destruction within 24 hours of its completion. Failure to comply carries a penalty of EUR50,000 (USD55,300) per hour, capped at €500,000.

The court also rejected Jaguar Land Rover's separate claim for BYD to pay EUR500,000 (USD553,053) in contractual penalties.

This procedural ruling is not final. The judgment discloses that Jaguar Land Rover has separately filed preliminary-injunction proceedings. One is in The Hague concerning the Defender’s design rights, and another is in Rotterdam over its copyright and alleged "slavish imitation." Both cases are still pending.

Analysts say that intellectual-property disputes between Chinese automakers and established European carmakers are attracting increasing attention as Chinese brands accelerate their expansion into the European market.

The ruling shows that companies seeking to obtain competitors' internal business information through legal proceedings abroad must still meet local legal requirements on the necessity and relevance of the evidence.

Yicai has reached out to BYD for comment on the ruling and the ongoing legal proceedings, and as of publication had not received a response.

Editor: Kim Taylor