Tag Archives: CAT

Economic complexity: CAT vs High Court

One of the advantages of the Competition Appeal Tribunal is said to be the fact that its three-member panel typically includes an economist. But is that really such a big advantage over the High Court?

The question is particularly topical in light of a couple of recent trends. On the one hand, recent legislative developments have increased the jurisdictional overlap between the CAT and the High Court, so that litigants more frequently face a choice between the two. In making that choice, the CAT’s economic expertise can exert a strong pull. Claimants might plead their case narrowly in order to come within its limited powers. Or, parties might seek to transfer their case across to the CAT from the High Court (not always successfully – see here).

On the other hand, there have been several indications that more could be done to make economic issues accessible to High Court Judges. A high-profile example is the recent Streetmap case, in which the experts gave evidence concurrently in a “hot tub” arrangement. Another example comes from the MasterCard litigation, in which Mr Justice Flaux recently asked whether it might help for the trial judge to be assisted by an expert economist appointed as an Assessor under CPR 35.15. I understand that the suggestion has not been taken any further in that particular case, but the general idea of using Assessors was also endorsed by another judge at a recent lecture on competition litigation.

Another tool which could be used much more widely in competition cases is the use of ‘teach-ins’ at which an independent expert spends time (perhaps a couple of days) educating the judge on the basic economic concepts relevant to the case. Care obviously needs to be taken to ensure that the teacher does not take a stance on controversial issues in the case. But if it is done well, as a recent patent case shows, it can be an invaluable way of helping a judge to prepare for a complex trial.

Of course, all of these techniques could be used in the CAT as well as in the High Court. It is perhaps too easy for parties in the CAT to assume that, just because there is an economist on the Panel, there is no need to do any more to make the economic issues accessible. The economist can only do so much, and the role does not include providing formal training to the other Panellists.

Against that background, it is worth revisiting the advantages of having an economist on the CAT Panel. The first is that he/she is fully involved in the hearing, and able to ask questions of the parties’ expert witnesses. Anyone who appears regularly in the CAT will have seen cases in which it is the economist Panellist who manages to cut through the arguments and identify the central point.

But there is no reason in principle why that advantage could not be replicated in the High Court. An Assessor could be appointed with the function of (among other things) asking question of the expert witnesses.  In practice this would be an unusual request, and of course the parties would need to foot the bill.  But there is no reason in principle why it could not be done.

The other main benefit of having an economist on the Panel is that he/she participates fully in the decision making. He works collaboratively, in private, with the other Panellists as they reach their decision. In contrast, if an Assessor were appointed in the High Court to help the judge reach a decision on the economic issues in the case, his advice would need to be given in public so that the parties could comment on it (see the Court of Appeal’s guidance at paragraphs 18-21 of this patent case). Such a process would be much more cumbersome than that in the CAT, but it would at least ensure that the parties could engage fully with the thinking of every economist involved in the case.

I do not mean to suggest that parties in economically complex cases should flock to the High Court rather than the CAT. But it is worth thinking hard before tailoring a case to fit within the CAT’s limited powers, or getting into a procedural fight over the forum. With a bit of imagination, and provided the parties are willing to pay for it, much can be done to assist the judge in the High Court to match many of the advantages available as a matter of course in the CAT.

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Standalone claims in the CAT: bypassing the transitional rules

We have written before about the problems inherent in the transitional provisions of the new Consumer Rights Act 2015 (see Tom de la Mare QC’s blog here). A recent decision from Mr Justice Barling in the Mastercard litigation places a (small) sticking plaster over some of the difficulties.

One problem is that the transitional provisions appear to severely limit claimants’ ability to bring stand-alone claims in the Competition Appeal Tribunal (“CAT”) – in theory you can bring such claims, but you may face much less favourable limitation rules than you would have faced had you started in the High Court.  It is difficult to see this as anything other than a drafting error, since part of the purpose of the new statutory regime was to do away with the oddity of having a specialist competition tribunal unable to hear such claims.

Barling J has found a partial solution to this problem. In Sainsbury Supermarkets Ltd v MasterCard Incorporated [2015] EWHC 3472 (Ch) (see here), he decided that Sainsbury’s standalone claim, issued in the High Court, could be transferred to the CAT – and that, importantly, such a transfer would preserve the limitation position in the High Court.

The Judge held that it did not matter whether or not the claim could have been started in the CAT (and he did not decide that particular issue). What mattered was that it could be transferred there.

The ability to transfer standalone claims to the CAT has obvious advantages for those cases which would benefit from the CAT’s economic and industry expertise. It is somewhat clunky for claimants to have to issue in the High Court (and incur fees there) only to then transfer to the CAT, but it is better than nothing.

It also means that claimants who wish to take advantage of the different limitation provisions in the High Court (in general, better for standalone claims) and in the CAT (in general, better for follow-on) now have the option of starting claims in both jurisdictions and then seeking to consolidate them in the CAT.

Of course, Barling J’s decision does nothing to fix the other problems highlighted in Tom’s blog. Most obviously, it does nothing for standalone class actions, which cannot be started in the High Court and still face the usual problems in the CAT. It is, however, a helpful ‘workaround’ which will go some way towards mitigating the problems caused by the transitional arrangements.

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PRIVATE ACTIONS: The CRA 2015 giveth; and the 2015 CAT Rules taketh away

Introduction

Today, on the 1st October 2015, when we are supposed to be celebrating the brave new world of the Competition Act 1998 (“CA”) as amended by the Consumer Rights Act 2015 (“CRA”), cartelists and other competition law infringers up and down the land[1] must be rubbing their hands in glee at the transitional provisions contained in Rule 119 of the Competition Appeal Tribunal Rules 2015 (“the 2015 CAT Rules” or the “New Rules”).[2]

The glee stems from the fact that these transitional provisions are very broad in temporal and material scope and yet very narrow in terms of gateway they provide into the new promised lands of flexible standalone claims,[3] and of collective redress leading to effective enforcement of private damages claims.   The problem, in essence is this: these transitional rules set in aspic for an unnecessarily long time the old CAT regime and all its manifest defects, defects which were the express cause for reform in the first place. Continue reading

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Skyscanner: CAT quashes commitments in the online booking sector

In a judgment handed down on Friday, the Competition Appeal Tribunal has quashed the Office of Fair Trading’s decision to accept commitments in the online hotel booking sector. As the first case to consider such commitments, Skyscanner Ltd v CMA [2014] CAT 16 contains some helpful guidance, albeit that Skyscanner’s success actually hinged on a fairly narrow point of regulatory law. Continue reading

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Dogma in telecoms, cream for the CAT: 08- numbers in the Supreme Court

The Supreme Court yesterday handed down judgment in British Telecommunications plc v Telefónica O2 UK Ltd & Ors [2014] UKSC 42. Reversing the decision of the Court of Appeal (blogged on here by Emily Neill), Lord Sumption for a unanimous Supreme Court held that there had been no basis for Ofcom to disallow BT’s introduction of “ladder pricing” in wholesale termination charges for certain non-geographic telephone numbers (specifically 080, 0845 and 0870, whence the litigation’s popular name among telecoms lawyers: “08- numbers”). Continue reading

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Cats, bags, rings and rooms: the problem of confidentiality

Dealing with confidential information in competition cases can be tricky.  The CAT’s recent judgment in BMI Healthcare and others v Competition Commission [2013] CAT 241 provides some help.

The core problem of confidentiality in the context of competition law is that many of the arguments deployed by litigants and regulators rely upon information which is highly commercially sensitive.  Revealing one party’s business secrets to another – letting the cat out of the bag2 – not only risks aggravation to the cat’s owner but has the potential for serious economic harm. Continue reading

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Conspiracy in the CAT: the scope of section 47A

What kinds of “follow-on” claims may be brought in the CAT?  ‘[A]ny claim for damages, or any other claim for a sum of money which a person who has suffered loss or damage as a result of the infringement of a relevant prohibition may make in civil proceedings brought in any part of the United Kingdom’, according to section 47A(1) of the Competition Act.  A ‘relevant prohibition’ for this purpose is of course defined as any of the Chapter I and II prohibitions or the prohibitions in Articles 101 and 102 of the Treaty.

The most obvious section 47A claim is a claim in tort for breach of statutory duty.  But what other causes of action fall within the scope of the section?

That question has been considered judicially for the first time in W. H. Newson Holding Ltd & ors. v IMI plc & ors. [2012] EWHC 3680 (Ch), a case arising out of the copper plumbing tubes cartel. Continue reading

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