Tucked away at the back of last week’s Supreme Court decision on time-limits for follow-on claims is a very important development for private competition actions.
The context is section 47A of the Competition Act 1998, a provision which has generated an extraordinary amount of litigation in view of the fact that it was intended to streamline private damages actions. Continue reading
Filed under Abuse, Agreements, Damages, Procedure
The Court of Appeal yesterday delivered a judgment that should finally draw a line under one of the Office of Fair Trading’s more troublesome cases – and which will presumably bring a great sigh of relief from the Competition and Markets Authority, the body that has now taken over the OFT’s functions. Continue reading
Filed under Agreements, Procedure
In its recent decision in British Sky Broadcasting Ltd v Office of Communications [2014] EWCA Civ 133 the Court of Appeal has sent a strong message to the CAT, criticising the Tribunal for its failure to properly consider the reasons underpinning Ofcom’s original decision to impose licence conditions on British Sky Broadcasting Ltd (“Sky”). Continue reading
Filed under Mergers
With legislation to introduce collective actions currently making its way through Parliament (see our previous blog here), we are pleased to welcome a guest blog from Elaine Whiteford of King & Wood Mallesons LLP and Oliver Gayner of Burford Capital (UK) Ltd. They highlight a litigation funding problem which will arise under the proposed new regime, and suggest an ingenious solution. Continue reading
Filed under Abuse, Agreements, Damages, Policy, Procedure
In a decision of 13 February 2014, the Court of Justice of the European Union (“CJEU”) added a little gloss to an otherwise well-trodden path in relation to the binding aspects of a Commission Decision. For instance, it is well established that assessments made in recitals to a decision “are not in themselves capable of forming the subject of an application for annulment” unless they are “the necessary support for its operative part” (see Case T-138/89 Nederlandse Bankiersvereniging and Nederlandse Vereniging van Banken v Commission [1992] ECR II-2181 at [31]). What of statements of position by the Commission subsequent to its Decision, e.g. in order to facilitate its enforcement at national level? Continue reading
It is again time for a round-up of recent competition law developments which have caught our attention.
Most attention-grabbing of all was the European Commission’s genius/bizarre/inexplicable decision to publish a comic book which is probably best described as a bureaucrat’s fantasy. A young Commission official (Thomas) starts talking to a beautiful woman (Chloe) in an airport departure lounge. Instead of ignoring his slightly creepy advances, Chloe turns out to want nothing more than to hear about the Commission’s antitrust work. Indeed, when Thomas false-modestly suggests that he might be boring her, she insists she wants to hear more:
And so starts the most fascinating hour of Chloe’s life. I should thank the Legal Cheek blog for bringing this important piece of work to my attention. Continue reading
Filed under Abuse, Agreements, Conflicts, Damages, Economics, Mergers, Pharmaceuticals, Policy, Round-Up, Telecoms
The Court of Appeal handed down two important decisions last week on the application of conflict of law principles to cartel follow-on damages claims: Deutsche Bahn AG & Ors v Morgan Advanced Materials plc & Ors [2013] EWCA Civ 1484 and Ryanair Limited v Esso Italiana Srl [2013] EWCA Civ 1450. The defendants in each case challenged the jurisdiction of the English courts to hear damages claims arising from their cartel activities. Continue reading
Filed under Agreements, Conflicts
In W.H. Newson Holding Limited & ors v IMI plc & ors [2013] EWCA Civ 1377, the Court of Appeal has made some important new law regarding the scope of section 47A of the Competition Act 1998 and the tort of common law conspiracy.
The Court upheld Roth J’s decision (on which see Tom Richards’ blog) that it is in principle possible to advance in the CAT a follow on claim based on common law conspiracy. However, it held that because the claim followed on from a Commission Decision which did not contain a specific finding that the Defendant intended to injure the Claimant, the cause of action could not be made out without inviting the CAT to make additional findings – an invitation which the CAT was bound to decline in the light of Enron 1 and Enron 2. Continue reading
Filed under Agreements, Damages, Policy
It is trite law that a parent company will be liable for antitrust infringements committed by a subsidiary where the parent exercises “decisive influence” over the conduct of the subsidiary. Earlier this year the Court of Justice of the European Union (“CJEU”) illustrated just how difficult it will be for a company to rebut the presumption of “decisive influence” in the context of a wholly-owned subsidiary (see Kieron Beal’s post here). In two decisions published on Thursday last week, the CJEU pushed the boundaries of parental liability even further, holding that parent companies may be liable for infringements committed by their joint venture companies.
This further affirmation that antitrust liability truly is a “family affair” is likely to have significant and far-reaching implications for the shareholders of such joint ventures. Continue reading
Filed under Abuse, Agreements, Penalties
This week has brought further news on the Libor interest rate fixing saga, with UK broker ICAP receiving an $87m fine.
However, whilst the media spotlight remains on the worldwide regulatory and criminal proceedings, a large number of potential claimants are waiting in the wings to bring private damages claims against those responsible for fixing the rates. Perhaps the biggest problem facing such claimants is how to quantify their loss. It is enormously complex, and therefore expensive, to try to work out whether the rate fixing harmed a particular person, and if so by how much.
Anyone trying to think of a way around this problem should pay attention to last week’s case management decision in Deutsche Bank AG and others v Unitech Global Limited and another [2013] EWHC 2793 (Comm). Continue reading
Filed under Agreements, Damages
The 10 July judgment in the American e-books case (US v Apple) addresses an important question not yet examined under European competition law: what determines the liability of the vertical participant (“B”) in an A-B-C information exchange? Continue reading
Filed under Agreements
The judgment in Akzo Nobel NV v Competition Commission [2013] CAT 13 is an important decision on the ability of the Competition Commission (“CC”) to block transactions between companies outside of the UK. However, neither party to the appeal will be entirely happy with the Competition Appeal Tribunal’s (“CAT”) legal analysis. There must therefore be a chance that – in a future case even if not in this one – the decision will be subject to attacks from both directions. Continue reading
Filed under Mergers
The UK government on Wednesday published a consultation on streamlining regulatory and competition appeals. The press spin was that the proposals are all about preventing “armies of lawyers” from blocking consumer-friendly measures. In reality, although it is true that the proposals are designed in part to put a lid on litigation, the consultation contains a series of thoughtful suggestions – many of which are likely to attract widespread support.
Take, for example, the suggestion that there should be greater consistency in the available appeal routes. Someone at the Department for Business, Innovation and Skills has had fun mapping out the existing appeal routes for different decisions in the regulated sectors. The resulting table speaks for itself (figure 3.5 of the consultation):
The trio of documents published by the Commission last week mark an important moment in private competition enforcement in the EU. After years of debate and consultation, it is now clear that, whilst the Commission is determined to take some important steps to assist claimants in private actions, it is not prepared to bring about the sorts of fundamental changes which would be needed to realise the full potential of private enforcement.
The three documents each deserve close scrutiny. This blog is intended only to provide a broad overview. Continue reading
Filed under Abuse, Agreements, Damages, Policy, Procedure
Things occasionally have an air of unerring certainty about them. It will rain on the May Day bank holiday weekend. Tottenham will be pipped to fourth place in the Premier League on the last day of the season. Attempts to challenge a Commission finding that a group of companies constitute a single economic entity will fail. So it has proved for Eni SpA, in its failed appeal against the judgment of the General Court in Case T-39/07 Eni v. Commission [2011] ECR II-0000, GC. Continue reading
Filed under Abuse, Agreements
On 19 April 2013, the OFT announced that it had issued a Statement of Objections following its investigation into patent litigation settlement agreements (PLSAs) in the pharmaceutical sector. The underlying factual complaint related to GlaxoSmithKline’s alleged conduct in defence of one of its blockbuster drugs, Seroxat, which is a prominent anti-depressant (paroxetine). The central allegation is that GSK concluded PLSAs with three generics companies – Alpharma Limited (Alpharma), Generics (UK) Limited (GUK) and Norton Healthcare Limited (IVAX) – which had sought to compete with their own paroxetine medicines. It is alleged that at particular points between 2001 and 2004, GSK sought to challenge its competitors’ entry into the market by threatening or instigating patent litigation. It then concluded the agreements which offered financial sums in exchange for the generics’ commitment not to supply paroxetine independently for a relevant period within the patent protection of Seroxat – although they were able to do so before this protection had ended. Continue reading
Filed under Abuse, Agreements, IP, Pharmaceuticals
A landmark recent judgment of the Grand Chamber of the CJEU was the first occasion on which the CJEU has considered the validity of a decision authorising enhanced cooperation. This is particularly topical given the flurry of initiatives relying upon this mechanism, some of which are now being challenged (such as the UK’s proposed proceedings against the Financial Transactions or “Tobin” Tax). However, it also calls for a post in this blog as it raises a number of interesting practical and legal issues for competition practitioners. Continue reading
The Competition Appeal Tribunal today delivered that rarest of beasts: a judgment awarding damages in a follow-on claim. After its decade-long fight, Albion Water has been awarded around £2 million for Dŵr Cymru’s abuse of dominant position in relation to the price it was prepared to charge Albion for the use of its water pipes.
The 130-page judgment consists largely of a detailed analysis of the counterfactual – i.e. what would have happened, and what profits would Albion have made, if Dŵr Cymru had not behaved abusively. It is, however, worth highlighting two points which will be of more general interest. Continue reading
Late in 2011, the Office of Fair Trading was forced to concede before the Competition Appeal Tribunal that it could no longer defend the theory of harm contained in its Decision on alleged pricing agreements between tobacco manufacturers and retailers.
However, the OFT refused to simply give up, and instead tried to persuade the CAT to allow it to run a new case. One of the barristers before the CAT (step forward Dinah Rose QC) described the OFT’s new case as “Frankenstein”, a corpse stitched together from components of the abandoned Decision. She invited the CAT to bury the corpse. It duly did so: the OFT was not allowed to run a new case, and the Appellants succeeded in their appeals.
The OFT’s original Decision, however, was not quite dead. Continue reading
Filed under Agreements, Procedure
The ECJ’s judgment in Case C-309/99 Wouters – that the Dutch legal regulator was an association of undertakings for the purposes of competition law, but that its prohibition on partnerships between lawyers and accountants nevertheless fell outside Article 101(1) having regard to its context and objectives – was a controversial one.
To some it suggested the emergence in European competition law of a “rule of reason”. Professor Whish preferred to treat it as an example of a standalone doctrine of “regulatory ancillarity” that enabled the courts to overlook the incidentally anticompetitive effects of primarily regulatory measures. Whatever the explanation, it was clear that the ECJ had introduced a doctrine which cut across the express wording of Article 101(1) and allowed measures of certain types to benefit from an unwritten exemption. It was unclear whether that doctrine was a new beginning or an evolutionary dead-end. Continue reading
In his recent blog “Down the rabbit hole,” Tom Richards described the “quasi judicial review within an appeal” contained in s.193(7) Communications Act 2003 as something of a Wonderland.
Last Wednesday it was the turn of the Court of Appeal to enter Wonderland. However, the judgment of Moses LJ in Everything Everywhere Ltd v Competition Commission and ors [2013] EWCA Civ 154 gives important general guidance on the evidence needed for an appeal “on the merits”. It is likely to be of assistance to appellants in a variety of contexts, whether or not they have ventured into this particular statutory Wonderland. Continue reading
Stand alone, follow on and hybrid damages claims arising out of multijurisdictional cartels are generating some of the most novel and interesting current problems in conflicts of laws, both in relation to issues of jurisdiction and applicable law. On the jurisdictional side conventional wisdom has it that there are three main routes by which Claimants can seize English jurisdiction.
First, you can find a so-called “Anchor Defendant” that is a cartelist (and it must be an addressee cartelist if in the CAT so long as Mersen is good law) domiciled here, against which you can proceed as of right under Article 2 of the Brussels Regulation. Then you can bring in other cartelists under Article 6 (i.e. a defendant against whom the claim is closely connected to that against the anchor defendant such that determining them together avoids the risk of irreconcilable judgments). Where the Anchor Defendant is an addressee of the decision this tactic is unproblematic. Continue reading
The big news from last week’s UK announcement on reforming private competition enforcement is that the government plans to introduce opt-out class actions for competition claims.
The proposals incorporate various “safeguards” designed to ensure that the perceived excesses of US class actions do not become a problem here. Some of the safeguards are really no more than statements of the obvious – no-one can be surprised that we will not have US-style triple damages, or that law firms won’t be able to bring a claim without even having a claimant. On the other hand, some safeguards – such as the prohibition on contingency fees – will surely serve to limit the usefulness of UK class actions.
Financing aside, the big unanswered question is how attractive claimants will find such class actions (or “collective actions”, as the government prefers to call them, emphasising the differences with the US). Continue reading
Filed under Abuse, Agreements, Damages, Policy, Procedure
On 25 October 2012 the Office of Fair Trading announced that it had written to the head teachers of almost 30,000 State schools to draw attention to the high price of school uniforms. The high price is caused in part by 74% of schools requiring parents to purchase uniforms from a single, named retailer or from the school itself. This has created a captive market for chosen suppliers, allowing them to charge an additional £52 million per year (see para 2.3 of the OFT’s 2006 school uniforms review).
The October 2012 letter advises schools either to cease specifying from whom uniforms may be obtained, or to award the right to supply on a basis that takes into account the cost to parents. The letter does not specify what the OFT will do if the schools fail to comply, but I want to suggest that action against the schools is possible under the Competition Act 1998. Continue reading
The duty of “sincere cooperation” set out in Article 4(3) TEU requires Member States to take appropriate measures to “ensure fulfillment of the obligations arising out of the Treaties or resulting from the acts of the institutions of the Union” as well as to “refrain from any measure which could jeopardise the attainment of the Union’s objectives“. When and in what way are Member State authorities required to act – or desist from acting – in order to comply with this duty?
This was the key issue in two cases decided this year regarding EU and national merger control (Ryanair Plc v OFT [2012] EWCA Civ 643 and Ryanair Plc v Competition Commission [2012] EWCA Civ 1632). Continue reading
As today is the first day of the new court term, I thought it would be a good moment for a round-up of last term’s competition cases – and, of course, the customary plug of our own blogs.
If there was a theme to the Michaelmas term, it was the highs and lows of follow-on claims. Few pieces of legislation can have attracted so much judicial attention in so short a time as s.47A of the Competition Act 1998. It has now gone as far as the Supreme Court, which confirmed in BCL Old Company Ltd v BASF plc [2012] UKSC 45 that the rules governing limitation periods for bringing follow on claims in the CAT are not so unpredictable as to breach European principles of legal certainty (a topic which I blogged on here). Continue reading
Filed under Abuse, Agreements, Damages, Penalties, Pharmaceuticals, Policy, Procedure, Round-Up, Telecoms
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
Filed under Agreements, Damages, Procedure
In a judgment handed down this afternoon, the Competition Appeal Tribunal largely upheld Tesco’s appeal against the OFT’s decision that it had participated in unlawful agreements relating to the price of cheese: see Tesco Stores Ltd v Office of Fair Trading [2012] CAT 31.
Tesco’s victory is essentially on the facts: it persuaded the CAT that the OFT had misunderstood the evidence. The case is therefore yet another example of the facts of a case appearing very different when placed under forensic examination before the Competition Appeal Tribunal than they did when considered by the regulator (other recent examples are the tobacco litigation and the BSkyB case).
The OFT is plainly keen to strengthen the quality of its decisions. It has recently revised its Competition Act procedures guidance with precisely that goal in mind. It will therefore want to examine this latest judgment to see whether any further steps should be considered. Two points stand out. Continue reading
Filed under Agreements
The Court of Justice of the European Union (CJEU)’s much anticipated early Christmas present for generic producers has arrived in the form of its judgment in the AstraZeneca case (Case C-457/10 P AstraZeneca AB and AstraZeneca plc v European Commission, 6 December 2012). The decision upheld that of the General Court and the Opinion of Advocate General Mazák, and suggests that the pharmaceutical industry may soon be faced with emboldened competition authorities.
At issue was the Commission’s finding of abuse of dominance (under Article 102 TFEU) for two abuses of the patent system by AstraZeneca (AZ). Firstly, the Commission found that AZ had made “misleading representations” to national patent offices in several Member States which enabled it to extend patent protection of one of its headline gastrointestinal treatments longer than should have been possible. Secondly, the selective deregistration of an older form of the drug had deprived generic producers of the simplified procedure for obtaining a marketing authorisation for their products under Article 4(3)(8)(a)(iii) of Directive 65/65. Continue reading
Filed under Abuse, Pharmaceuticals
The famous Victorian cricketer WG Grace is reputed once to have offered the following advice:
“When you win the toss – bat. If you are in doubt, think about it, then bat. If you have very big doubts, consult a colleague – then bat.”
The recent Emerson decision [2012] EWCA Civ 1559 is another illustration that bringing a follow on claim in the CAT rather than in the High Court is the law’s equivalent of choosing to bowl.
Emerson was yet another interlocutory skirmish arising from the CAT’s notoriously troublesome follow on jurisdiction under section 47A of the Competition Act 1998. Continue reading
Filed under Agreements, Procedure
Competition Bulletin 