Josh Holmes QC and Jack Williams appear for Google in General Court

Between 2 May – 4 May 2022, Josh Holmes QC and Jack Williams made oral representations at the General Court of the European Union on behalf of Google in an appeal against a decision of the European Commission imposing a 1.5 billion euro fine on Google in connection with its ad intermediation service, Adsense for Search.

The case (T-334/19) is an important one concerning the meaning and application of the concept of exclusivity obligations within the Article 102 TFEU framework, and the Commission’s legal burdens and investigative duties.

Josh and Jack were instructed by Claire Jeffs of Slaughter and May. Daniel Beard QC was also instructed during the written part of the proceedings.

Court of Appeal refuses the Good Law Project permission to appeal in ‘Pestfix’ PPE procurement challenges

R (Good Law Project and Another) v Secretary of State for Health and Social Care

On Friday 29 April 2022, Lord Justice Coulson refused the Good Law Project permission to appeal against the Order of O’Farrell J dated 15 February 2022 in the group of judicial review challenges often known as ‘PestFix’. This was a ‘family’ of JR challenges, heard together, in respect of the award of various PPE supply contracts by the Secretary of State to PestFix, Clandeboye and Ayanda. In a judgment of 12 January 2022 ([2022] EWHC 46 (TCC)), O’Farrell J rejected the claims. See case news item of 12 January 2022.

The Good Law Project sought to appeal on six grounds. Permission was refused on all grounds. Coulson LJ stated that there was an “overarching reason” why the application must be refused namely that the grounds did not suggest that the judge made any errors of law or principle, but were just “an attempt to reargue the facts”.

The appellants sought to appeal the trial judge’s s.31(2A) SCA 1981 ruling. O’Farrell J found, in respect of the PestFix and Ayanda contracts, that the respondent had acted unlawfully in conferring preferential treatment by allocating them to a ‘High Priority Lane’. However, she went on to find that it was highly likely that, even if they had not been allocated to that Lane, the outcome would not have been substantially different and the contracts would still have been awarded to PestFix and Ayanda. Refusing PTA, Coulson LJ emphasised that the s.31(2A) test is “fact-sensitive and ultimately a matter for the trial judge”.

This brings to an end this high profile and significant litigation, which was named as one of The Lawyer Top Twenty cases of 2021 and described as “one of the most notable cases to emerge from the pandemic”.

Michael Bowsher QC, Ewan West, Imogen Proud, Khatija Hafesji and Alfred Artley acted for the Secretary of State, instructed by GLD.

Alan Bates acted for Pestfix, instructed by Osborne Clarke, and acted for Ayanda, instructed by Lewis Silkin.

EU General Court reduces Cathay Pacific Air Cargo Fine by €10 million

On 30 March 2022, in the most recent judgment in the long-running “Air Cargo” damages litigation, the European General Court upheld, in part, Cathay Pacific’s appeal and partly annulled the Commission’s 2017 decision. This resulted in cut in the fine imposed on the airline, from €57.12m to €47.14m.

The judgment upheld one of Cathay Pacific’s grounds of appeal and annuls the Commission decision in part, on the basis that penalising Cathay Pacific for the infringement in respect of intra-EEA routes and EU Switzerland routes was in breach of the rules on limitation.

British Airways, Japan Airlines, Air Canada, SAS Cargo, LATAM and LAN Cargo also secured partial annulment. However, the General Court upheld the European Commission fines against Air France, KLM and Martinair, along with Cargolux, Singapore Airlines, and Singapore Airlines Cargo, as well as Lufthansa.

See judgment in Case T-343/17 Cathay Pacific v European Commission EU:T:2022:184 here.

See the CJEU’s press release here.

Ronit Kreisberger QC and Nikolaus Grubeck represented Cathay Pacific, instructed by Martin Rees and Erling Estellon of Squire Patton Boggs.

Josh Holmes QC represented the European Commission.

Jon Turner QC leads for British Airways as EU Court partly annuls Commission’s 2017 decision, reducing fine by €20 million.

On 30 March 2022, in the most recent judgment in the long-running “Air Cargo” damages litigation, the European General Court upheld, in part, British Airways’ appeal and partly annulled the Commission’s 2017 decision. This resulted in a near 20% cut in the airline’s €104 million fine for the airline.

In 2010, after the Commission found a group of airlines guilty of price fixing for air cargo services, a large number of damages claims by air cargo shippers were brought together against British Airways. Since that time Jon has been retained as the lead counsel for British Airways, which brought in a group of other airlines as contribution defendants. The long-running damages litigation came to an end in 2019, but an arm of the litigation involved appeals against the European Commission’s infringement decision in the European courts.

This most recent judgment upheld one of British Airways’ grounds of appeal and annuls the Commission decision in part, in so far as it finds that they participated in the element of the infringement relating to the refusal to pay commission on the surcharges.

Japan Airlines, Air Canada, Cathay Pacific, SAS Cargo, LATAM and LAN Cargo also secured partial annulment. However, the General Court upheld the European Commission fines against Air France, KLM and Martinair, along with Cargolux, Singapore Airlines, and Singapore Airlines Cargo, as well as Lufthansa.

See judgment here

Jon Turner QC represented British Airways, instructed by Slaughter and May.

Alan Bates represented the European Commission.

George Peretz QC acted for the European Commission in both the LAN Chile:LATAM and Air Canada appeals.

CAT refuses to certify forex collective claims on an “opt-out” basis

The Competition Appeal Tribunal has refused to certify two applications for collective proceedings on an “opt-out” basis.

The two competing applications were brought by O’Higgins (represented by Scott+Scott) and Mr Evans (represented by Hausfeld & Co). Both advanced claims against major banks seeking compensation for alleged losses sustained by buyers and sellers of G10 currencies in foreign exchange markets.

The Tribunal, by majority, upheld the objection of the banks and refused to certify the applications on an “opt-out” basis. It also granted three months to O’Higgins and Mr Evans to decide whether or not to amend their applications so as to proceed on an “opt-in” basis.

Collective proceedings which are certified on an “opt-in” basis will usually be much smaller, and hence much harder to fund, than proceedings which are certified on an “opt-out” basis. Indeed, both O’Higgins and Mr Evans submitted to the Tribunal that forcing them to proceed on an “opt-in” basis would have the effect of stifling their claims.

A link to the judgment is here.

Ronit Kreisberger QC and Thomas Sebastian acted for MUFG (instructed by Herbert Smith Freehills).

Daniel Beard QC, Rob Williams QC and Daisy Mackersie acted for JP Morgan (instructed by Slaughter and May).

Josh Holmes QC appeared on behalf of the NatWest/RBS Respondents in Cases 1329 and 1336 (instructed by Macfarlanes LLP).

Philip Moser QC wins again vs MIB in Court of Appeal – MIB liable to victim if insurance voided post-accident

Colley v Motor Insurance Bureau, Court of Appeal, Judgment 22 March 2022, [2022] EWCA Civ 360

The Court of Appeal has dismissed the appeal in Colley v Shuker & ors (the first instance decision is discussed here). Philip Moser QC acted for the successful claimant/respondent.

The claim is by Mr Daniel Colley, the passenger victim of a road traffic accident who suffered catastrophic injuries in a car crash in 2015. He claims Francovich damages by his directly effective rights under the Codified Motor Insurance Directive 2009/103/EC (“the Directive”).

The claim is against the Motor Insurers’ Bureau (“the MIB”), which was held to be the appropriate UK body for claims under the Directive in MIB v Lewis (see news item here). The MIB nonetheless denied liability, claiming that it was not the appropriate body for the particular obligation in this case.

The question on appeal was: Is the obligation of the MIB under Articles 3, 10 and 12 of the Directive an obligation limited to providing compensation where there is an unidentified vehicle or a vehicle in respect of which there is no policy of insurance in being at the time of the incident giving rise to liability? Or does the obligation also extend to a case where there is a policy of insurance in being at the time of the incident giving rise to liability, but that policy is subsequently avoided ab initio?

The Court of Appeal (Stuart-Smith LJ giving the judgment of the Court) held that the MIB’s obligation to pay the victim does extend to such a case.

It was not in dispute in the appeal that UK implementation of the Directive was in breach of EU law. As a consequence of this breach Mr Colley did not receive the compensation from the Insurer that, as a matter of European law, he should receive.

The MIB’s (directly enforceable) obligation under Article 10 to provide compensation for personal injuries caused by “a vehicle for which the [Article 3] insurance obligation … has not been satisfied” is coextensive with the Article 3 obligation on the State and the MIB must therefore make good the shortfall between what should have been provided and what was provided as a result of the non-compliance (which was nothing).

In so finding the Court of Appeal followed and applied the CJEU cases Case C-409/11 Csonka and Case C-287/16 Fidelidade and reaffirmed its own case law in Delaney (see news item here) and Lewis (see news item here).

Philip Moser QC was instructed by Irwin Mitchell LLP. A link to the judgment is here.

CAT grants permission to serve Meta and Facebook Ireland outside the jurisdiction

The Competition Appeal Tribunal has granted Dr Lovdahl Gormsen permission to serve a collective proceedings claim form on Meta and Facebook Ireland out of the jurisdiction.

Dr Lovdahl Gormsen is the Proposed Class Representative in a claim for abuses of dominance, brought on behalf of some 45 million Facebook users.

The President of the Competition Tribunal held that it is “seriously arguable that the matters relied on and alleged constitute abusive conduct” and that “there is a serious issue to be tried on the merits of the case against Meta, and Facebook Ireland”. He also considered “that the UK (and this Tribunal) is clearly and distinctly the appropriate forum for the trial of this action”.

The President’s Reasoned Order is available here.

Ronit Kreisberger QC and Nikolaus Grubeck act for Dr Lovdahl Gormsen, instructed by Quinn Emanuel.

Treasury Select Committee hears evidence on the Swift Report

John Swift QC’s independent lessons learned review of the FCA’s supervisory intervention on interest rate hedging products was published in December 2021.

On 16 March 2022, John Swift QC appeared before the Treasury Committee with Nikolaus Grubeck and David Capps of Ashurst LLP to answer questions about the review. Kristina Lukacova also worked on the Review and attended the hearing as part of the Review team.

A video link is available here.

The Report is available here.

Court of Appeal restores £1.4 billion claim in an important judgment on jurisdiction

On 25 February 2022, the Court of Appeal (Sir Julian Flaux, Chancellor of the High Court, Phillips and Stuart-Smith LJJ) handed down judgment in the case of SKAT v Solo Capital Partners [2022] EWCA Civ 234, a case raising important issues on jurisdiction.

The Claimant is the Danish tax and customs administration (SKAT). It alleges that it was the victim of a tax fraud by various businesses, investors and individuals in the  period between 2012 and 2015. It brings claims in London against these individuals totalling around £1.4 billion.

The preliminary issue before the Court of Appeal was whether SKAT’s claims were barred by application of the Common Law rule against the enforcement of acts of foreign public law. This is set out in Rule 3(1) of Dicey, Morris & Collins on the Conflict of Laws, 15th ed “English courts have no jurisdiction to entertain an action … for the enforcement, either directly or indirectly, of a penal, revenue or other public law of a foreign State”. A closely analogous issue arose under Article 1(1) of Brussels I (recast) regulation on the jurisdiction and the recognition and enforcement of judgments. The question arose as to whether SKAT’s claim fell outside the scope of the regulation which does not extend to “revenue, customs or administrative matters or to the liability of the State for acts and omissions in the exercise of State authority (acta iure imperii)”.

The Court of Appeal found that SKAT’s claims (as alleged) were admissible before the English court, on the basis that the claims were not for unpaid tax but to recover monies which had been abstracted from SKAT’s general funds by fraud. The sovereign act principle was therefore inapplicable. On this basis, SKAT’s claims were found to fall outside the scope of the Common Law Revenue Rule as against all Defendants, and should proceed to trial.

However, SKAT had not challenged the trial judge’s finding that the case against one group of defendants (the “ED & F Man” defendants) fell within the scope of the Revenue Rule. The court therefore found that by parity of reasoning the claim against ED & F Man must also fall outside the scope of the Brussels Regulation, rejecting SKAT’s argument that the claim was a “civil or commercial” matter within the meaning of the Brussels Regulation, and that this precluded reliance on the Common Law Revenue Rule. The claim against ED & F Man was therefore barred from proceeding in the English courts.

The Court of Appeal’s judgment sheds further light on the scope of the prohibition at Common Law on the enforcement of foreign public law and will be of significance in any further cases raising such issues.

Robert Palmer QC, Christopher Vajda QC and Conor McCarthy, instructed by Simons Muirhead Burton, acted for one group of defendants in the proceedings. Their submissions on the effect of the Brussels Regulation were upheld by the Court of Appeal.

The judgment is here.

 

Seven Monckton barristers act for NHS claimants in milestone judgment against pharma company Servier in its attempt to limit damages in “pay for delay” perindopril case

The High Court has ruled in favour of the NHS and against Servier, the French pharmaceutical giant, and its attempts to limit damages for serious infringements of competition law in the sale and supply of the widely prescribed blood pressure drug, perindopril (brand name Coversyl).

The 109-page judgment by Mr Justice Roth is a major victory for the NHS.

The case concerns actions between 2005 and 2007, in which Servier entered into “pay for delay” agreements with four generic drugmakers to stall competition for perindopril, and committed alleged abuses of a dominant position. These practices are estimated to have cost the NHS hundreds of millions of pounds.

Servier was found to have engaged in anticompetitive practices by the EU Commission, and the Commission’s decision was upheld in part by the General Court in 2018. The General Court found that the pharmaceutical company had committed a very serious breach of competition law, by agreeing with providers of generic alternatives to delay entering the market with less costly versions of the drug. The General Court did not find that there was a sufficient basis for a finding of dominance for the purposes of the abuse of dominance allegations, and this point is currently on appeal by the Commission to the European Court of Justice (just as the “pay for delay” issues are on appeal by Servier). In the NHS damages actions, the abuse of dominance claims are not pursued pending the outcome of the further appeal to the European Court of Justice.

The NHS claimants are seeking, as damages, the difference between the prices they paid and what the prices that they estimate they would have paid if the price had been determined under conditions of normal competition.

In the latest stage of this action Servier contended that damages to the NHS should be reduced because the NHS should have taken appropriate steps to avoid buying Servier’s product, by encouraging the use of cheaper alternatives, even though at the time Servier was actively promoting its drug to clinicians, including on the basis that it was different from those alternatives.

Mr Justice Roth in rejecting this argument, commented that “…a disinterested observer might find it surprising that such arguments would, or could, be advanced by a defendant found to have committed a very serious infringement of competition law”.

The final judgement in the European proceedings is anticipated later this year and a full trial to determine the level of damages due to the NHS will follow.

See full judgment here.

Jon Turner QC and Josh Holmes QC for the Claimants collectively.
Philip Woolfe (instructed by Peters & Peters Solicitors LLP) for the English Claimants.
Julian Gregory and Alexandra Littlewood (instructed by RPC LLP) for the Scottish / NI Claimants.
Laura Elizabeth John and Ciar McAndrew (instructed by Geldards LLP) for the Welsh Claimants.