In a four-day trial starting on 19 April 2021, rival claimants the Road Haulage Association (RHA) and UK Trucks Claim (UKTC) argued before the Competition Appeal Tribunal (the CAT) that their applications should be approved, enabling them to proceed to trial.[1] Both claimants are potential class action representatives intending to sue the truck manufacturers that were involved in the truck cartel on behalf of injured parties that bought or leased trucks from the cartelists. The CAT will have to decide whether or not to award a “collective proceedings order” (CPO) to one, both or neither of the claims. A CPO is required under the UK class action regime for either claim to proceed.
The claims differ in that the RHA is looking to use an “opt-in” scheme, while UKTC is primarily looking to bring an “opt-out” claim, with an opt-in scheme put forward only as an alternative. Another difference is that the UKTC claim does not extend to second-hand trucks, while the RHA claim covers all trucks, both new and second-hand.
The truck manufacturers argued that neither RHA or UKTC should be awarded certification because their claims did not satisfy the criteria for approval. As early as October 2019, the cartelists tried to have the planned class actions struck out by challenging the funding arrangement underlying the lawsuits, but without success at first instance.[2] A hearing took place in January 2021 in appeal proceedings brought by DAF to challenge this ruling. The appeal continues.[3]
[1] The case references are: 1282/7/7/18 UK Trucks Claim Limited v. Stellantis N.V. (formerly Fiat Chrysler Automobiles N.V.) and Others; 1289/7/7/18 Road Haulage Association Limited v. Man SE and Others.
[2] Competition Appeal Tribunal 28 October 2019, [2019] CAT 26, Case No. 1282/7/7/18, 1289/7/7/18.
[3] According to Mlex, ‘DAF tells UK judges truck-cartel mass suits must be struck out over funding arrangements’, 26 January 2021.
On 14 April 2021, the Court of Appeal in London upheld a High Court decision of February 2020 to the effect that computer company OT Computers was not time-barred from suing chip manufacturers Infineon Technologies and Micron Technology for their role in the memory chips cartel for which the European Commission had fined the companies back in 2010.[1] The chip makers attempted to get the ruling overturned on appeal, arguing that the limitation periods for the claims had passed because the impact of the cartel was investigated by the US Department of Justice years prior to the EU probe into the chip makers’ conduct. This argument did not succeed, as the judge said the EU decision involved information that was essential in order to bring a claim, and the claimants therefore had to wait for the decision. As the limitation arguments were a preliminary issue which has now been decided in favour of OT Computers, the parties can now press ahead with full legal proceedings.
[1] Court of Appeal London 14 April 2021, [2021] EWCA Civ 501, Case No. A4/2020/0658, A4/2020/0672, A4/2020/0675 & A4/2020/0674.
On 6 May 2021, Advocate General Michal Bobek issued an Opinion in one of the cases concerning the air cargo cartel.[1] The Dutch litigation vehicles Stichting Cartel Compensation and Equilib Netherlands instituted proceedings against British Airways, KLM and other airlines after the European Commission established in 2010 that the airlines had made prohibited price agreements with regard to cargo shipments prices. The AG’s Opinion pertained in particular to the question of whether damage could also be claimed for the period prior to 2004, when important competition law came into force. According to the airlines, Articles 104 and 105 TFEU would result in the national courts not having jurisdiction to rule on antitrust damages cases from that period. Advocate General Bobek did not concur with this and thus concluded that national courts could also rule on antitrust damages claims dating from before 2004.
[1] Advocate General M. Bobek, 6 May 2021, case C-819/19 (Stichting Cartel Compensation and Equilip Netherlands/KLM et al.)
On 22 April 2021, another truck cartel Opinion was issued by an Advocate General at the Court of Justice. This time, it concerned the case RH (name kept anonymous) v. Volvo AB, Volvo Group Trucks Central Europe GmbH, Volvo Lastvagnar AB and Volvo Group España SA (“Volvo”), which had been instituted before the Madrid Commercial Court.[1] Acting Advocate General J. Richard de la Tour considered a question of jurisdiction put by the Commercial Court. Volvo took the position that the Madrid Commercial Court did not have jurisdiction to handle the antitrust damages case because “the place where the harmful event occurred or may occur” from Article 7(2) of Brussels I Regulation Recast[2] was not within that Court’s district. According to Volvo, the place in question was the place where the competition arrangements for trucks were established (i.e. where the cartel agreements were made), and that was not in Spain. The claimant had asserted that the place where its registered office was located, within the district of Madrid, could also be considered as such.
The Advocate General concluded that the place where the affected market is located falls under Article 7(2) of Brussels I Regulation Recast. In addition, the Advocate General concluded that the place where the injured party’s registered office is located may also fall under Article 7(2), because this interpretation fosters effective legal protection under competition law. Otherwise, a company that had purchased trucks in various Member States would have to initiate (the same) antitrust damages proceedings in those various States, which would hardly be efficient. The Advocate General did emphasise, however, that Member States are free to give certain courts exclusive jurisdiction to hear antitrust damages cases.
[1] Advocate General J. Richard de la Tour, 22 April 2021, case C-30/20.
[2] Regulation (EU) No 1215/2012 of the European Parliament and of the council of 12 December 2012 on jurisdiction and the recognition and enforcement of judgments in civil and commercial matters.
On 15 April 2021, European Advocate General Giovanni Pitruzella issued an Opinion in one of the many truck cases,[1] specifically that of the Spanish company Sumal S.L. v. Mercedes Benz Trucks España S.L., a Daimler subsidiary. Although the Spanish truck company was not mentioned in the European Commission’s decision of 19 July 2016 in which a fine was imposed on Daimler, Suma S.L. took the view that liability towards it could also be imputed because Mercedes Benz Trucks España S.L. formed a single economic unit with the parent company.[2] It is a generally accepted doctrine that a parent company can be liable for anti-competitive conduct by a subsidiary if they together form an ‘economic unit’. This is termed ‘bottom-up liability’. Advocate General Pitruzzella concluded that, if such an economic unit exists and the subsidiary contributed substantially to the infringement, ‘top-down liability’ is also possible.
[1] Advocate General G. Pitruzella, 15 April 2021, case C-882/19.
[2] See here for all European Commission documents in the case AT.39824 Trucks v. Daimler et al..
After commencing investigations against Facebook, Inc. in January 2021, the Bundeskartellamt reported in press releases on 18 May and 25 May 2021 that it had initiated proceedings against Amazon, Inc. and Google, Inc., respectively, based on the new rules for large digital companies.[1]
The 10th amendment to the German Competition Act (GWB Digitalisation Act) came into force in January 2021. A key new provision set forth in Section 19a GWB enables the authority to intervene earlier and more effectively, in particular against the practices of large digital companies. In a two-step procedure, the Bundeskartellamt can prohibit companies which are of paramount significance for competition across markets from engaging in anti-competitive practices.
In the case against Amazon, the Bundeskartellamt stated that they were examining whether Amazon was of such paramount significance. An ecosystem which extends across various markets and thus constitutes an almost unchallengeable position of economic power is particularly characteristic in this respect. According to the president of the Bundeskartellamt, this could apply to Amazon with its online marketplaces and many others, above all digital offers.
Similar proceedings have been initiated against Google Germany GmbH, Hamburg, Google Ireland Ltd., Dublin, Ireland, and Alphabet Inc., Mountain View, USA. Due to the large number of digital services offered by Google, such as the Google search engine, YouTube, Google Maps, the Android operating system or the Chrome browser, the company could be considered to be of paramount significance for competition across markets. A second set of proceedings will undertake an in-depth analysis of Google’s data processing terms, as Google’s business model relies to a very large extent on processing data relating to its users. The main question is whether users have sufficient choice as to how Google will use their data.
On 21 June 2021, the Bundeskartellamt also initiated such an inquiry into Apple to assess whether Apple’s new privacy policy, its App Store rules, and the pre-installation of its apps on iPhones require intervention. The assessment will examine the extensive integration of the
[1] Proceedings against Amazon based on new rules for large digital companies (Section 19a GWB); Proceeding against Google based on new rules for large digital players (Section 19a GWB) – Bundeskartellamt examines Google’s significance for competition across markets and its data processing terms; Apple faces German antitrust probe under country’s new tech rules.
On 13 April 2021, the Federal Court of Justice rendered another antitrust damages judgment, this time regarding the truck cartel.[1] Daimler initiated the appeal in cassation after it had lost before Schleswig-Holstein Higher Regional Court in a case against an (anonymised) freight forwarder that claimed damages from the manufacturer for nine trucks it had purchased from Daimler and DAF. Daimler, along with DAF, Volvo-Renault, MAN and Iveco, was fined in 2016 for infringing agreements on prices and introduction of emission standards in the period 1997-2011. In 2017, Scania was also fined for these infringements. The lower courts had therefore ruled that the infringing acts caused damage to the anonymous claimant and had ordered Daimler to compensate it. In April 2021, the Federal Court of Justice ruled that Schleswig-Holstein Higher Regional Court had correctly held that the cartel was likely to have caused damage due to a price increase, but the Higher Regional Court had failed to take sufficient account of the fact that the price increases could (partly) be passed on to customers of the injured party. Moreover, Daimler and DAF had submitted their own economic investigations that concluded that no price increases had been observed. According to the Federal Court of Justice, those investigations were insufficiently taken into account in the assessment. The Federal Court of Justice referred the case back to the Schleswig-Holstein Higher Regional Court for further assessment.
The railway construction cartel also brought about three judgments of the German Federal Court of Justice (Bundesgerichtshof) of 13 April 2021. These concerned antitrust damages cases initiated by two (anonymous) regional transport operators from Dortmund, Duisburg and Cologne against (anonymous) railway construction companies.[1] The lower courts ruled in both cases that the price cartel created a suspicion of damage, that the cartelists had not sufficiently refuted that suspicion and therefore that they must compensate the damage. The Federal Court of Justice held that this was an interpretation of the burden of proof rule that is not in line with previous case law from the highest court. The rule that damage is suspected in a cartel case is a rule based on experience, but it does not automatically mean that the burden of proof is reversed. The Federal Court of Justice found: “Taking such a principle of experience into account does not, however, lead to reversal of the burden of proof. The principle of experience in question should rather be taken into account in the context of the general assessment of all circumstances that argue in favour of or against the occurrence of the damage“. Consequently, the rule of suspicion of damage may only alleviate the claimants’ obligation to provide substantiation, but cannot lead to a different division of the burden of proof. The Federal Court of Justice therefore referred the cases back to the relevant appellate courts, as the Federal Courts of Justice cannot rule on the facts and circumstances. These judgments were only published on 19 July 2021 and 27 August 2021[2] and may have consequences for all previous judgments rendered by lower courts in relation to the railway construction cartel.
[1] Federal Court of Justice 13 April 2021, case KZR 98/18 and Federal Court of Justice 13 April 2021, case KZR 95/18 and Federal Court of Justice 13 April 2021, case KZR 40/19.
[2] “German transport operators’ train-tracks cartel damages suits sent back for review”, MLex 19 July 2021; “Cologne mass-transit operator’s train-tracks cartel damage lawsuit referred back to lower court”, MLex 27 August 2021.
On 3 February 2021, Dortmund Regional Court (Landgericht) ruled that a transport association from North Rhine-Westphalia (its name has been anonymised) is entitled to compensation for damage caused by a railway construction cartel.[1] This association had acquired companies that paid too much for railway superstructure materials as a result of a cartel. On 18 July 2013, the German competition authority, the Bundeskartellamt, imposed a fine of EUR 97.64 million on a large number of producers of railway building materials (also anonymised). According to the penalty decision, the cartelists made price, quota and customer protection agreements on the private market in Germany from 2001 to 2011. The Regional Court found that it may be suspected that all tenders for the rail materials in question fell under the cartel during that period. With regard to the damage, Dortmund Regional Court referred to a general study by Oxera from 2009[2] which shows that 93% of price cartel cases results in a price increase. Given the duration of the cartel (10 years) and the size of the cartel (90% of the market participated), damage could be suspected in this case as well. Because the claimants had taken over the damage-suffering companies, they could lodge the claims for damages. The cartelists provided insufficient proof to the contrary and must therefore compensate the damage. The court assumed a prohibited price increase of 10%. Other claims were rejected because although another company had purchased material from the defendants, this company had not indicated why these transactions fell under the cartel.
[1] Dortmund Regional Court, 3 February 2021, ECLI:NLDE:LGDO:2021:0203.8O116.14KART.00.
[2] Oxera, 2009: Quantifying Antitrust Damages: Towards Non-Binding Guidance for Courts.
On 23 June 2021, in an action for damages with regard to the lift cartel, Rotterdam District Court ruled that the possibility of damage is plausible for 41 housing corporations represented by the claimant Stichting De Glazen Lift (DGL).[1] In its interlocutory judgment of 29 May 2019, the District Court gave DGL the opportunity to enter documents into evidence showing that during the period of the cartel each member of the foundation had purchased at least one lift from the cartelists or had had at least one lift maintained or modernised by the cartelists.[2] In this judgment, the District Court confirms that evidence of a single transaction is sufficient to (be able to) make the possibility of damage plausible and to achieve the threshold for referral to the determination of damages, at which stage the scope of the damage can be addressed.[3] DGL has sufficiently done so by submitting the additional documents; the District Court rejected the cartelists’ defences against these.
The District Court then discussed the pass-on defence put forward by the cartelists, with regard to which the District Court had ruled in the interlocutory judgment that it would be up to them to substantiate this defence and, if necessary, prove it, for which purpose DGL should, however, offer sufficient starting points by submitting documents unavailable to Kone and Otis.[4] Kone and Otis argued that DGL did so insufficiently, that they are therefore unable to substantiate the passing on, and that DGL’s claims should therefore be denied. The District Court agreed with Kone and Otis that DGL submitted a very limited number of documents, but the District Court nevertheless did not proceed to deny the claims because, based on the documents, the District Court in any event deemed it plausible that the participants did not or could not pass on all additional costs, so that it was nevertheless plausible that the members suffered damage.[5]
The District Court issued a declaratory judgment to the effect that Kone and Otis are jointly and severally liable for the damage suffered by the participants and refers the case to follow-up proceedings for the determination of damages.
[1] Rotterdam District Court 23 June 2021, ECLI:NL:RBROT:2021:6635.
[2] Para. 2.1.
[3] Para. 2.6.
[4] Paras. 2.1, 2.11
[5] Para. 2.13.
