The Competition Appeal Tribunal today ruled that the NHS is not time-barred from pursuing claims for damages against Lundbeck, the Danish pharmaceutical company, and various manufacturers of generic pharmaceuticals, arising out of the “pay for delay” cartel found by the European Commission.

In 2013, the Commission found that Lundbeck, which held various patents in relation to the manufacture of citalopram, a regularly-prescribed treatment for anxiety and depression, had agreed with generic manufacturers that they would abandon their legal challenges to Lundbeck’s patents and stay out of the market in return for payments equivalent to the amount of profit that those generic companies would have made on successful entry.  The Commission found that those agreements breached EU competition law.  In March 2021 the European Court of Justice gave judgment upholding a ruling of the EU General Court that dismissed the companies’ appeals against the Commission’s decision.

The NHS brought an action for damages arising out of the companies’ breach of competition law in the High Court in 2019, just before the sixth anniversary of the Commission’s decision, and that action was transferred to the CAT in 2021.  It was agreed in the transfer order that the NHS would file a claim form in the CAT setting out the details of its claim, which it did in March 2023 (less than 2 years after the Court of Justice’s ruling).

The companies then claimed that the NHS was out of time, under the six year period set out in the Limitation Act 1980, on the basis that it knew or should have known before the date of the decision that it had a cause of action.  The NHS conceded that point, but relied on a separate limitation period under the CAT’s rules that ran for two years from the date of the Court of Justice’s judgment.  The companies accepted that that separate period could have applied, but argued that the filed claim form could not be regarded as a claim form making a new claim, as it was no more than a step in the transferred proceedings.  They also argued that the NHS was estopped from relying on the separate limitation period.

The CAT held that the claim form did have the legal effect of starting proceedings within the separate limitation period, and that proceedings were therefore brought in time.  It also held that there was no estoppel as alleged by the companies.

The NHS’s claim for damages will now proceed.

George Peretz KC represented the NHS before the CAT: he previously represented the European Commission in its successful defence to the appeals in the EU General Court and Court of Justice.

The Administrative Court has handed down judgment in a public law challenge concerning a £2.4bn Private Finance Initiative (PFI) project for Birmingham’s road network.

PFIs are long-term contracts between a private party and a government entity where the private sector designs, builds, finances and operates a public asset and related services, and bears the financial risks of doing so.

In 2010, Birmingham City Council (BCC) entered into a project agreement with a private contractor for delivery of a 25-year PFI project that includes 2,500 km of the city’s road network, up to 100,000 street lighting columns, over 850 highway structures and bridges, three tunnels, 5,000 km of footways and 76,000 street trees. In response to significant contractual disputes between BCC and the contractor (which culminated in a Court of Appeal judgment in favour of BCC), BCC sought Government approval for proposed changes to the project agreement. In November 2023, the Government rejected those proposals on the basis they were unaffordable when set against existing spending commitments.

The Court has quashed, on grounds of procedural fairness, the Government’s decision to reject BCC’s proposals. However, the Court dismissed BCC’s main case that it had unlawfully been deprived of a substantive legitimate expectation that Government would continue to pay PFI credits for the remaining 12 years of the project. In reaching that conclusion, the Court concluded that documentation produced by the Government at the time the PFI was entered into did not restrict the Government’s ability to terminate PFI credits only in “exceptional circumstances”.

The Judgment is available here.

Ewan West KC and Will Perry acted for the Secretary of State for Transport.

R (RK) v London Borough of Newham (JR-2023-LON-001029)

In a judgment handed down on 19^th June 2024, Upper Tribunal Judge Reeds found – as a matter of fact – that the Applicant was of his claimed age.

Khatija Hafesji acted for the Applicant, who had arrived to the UK from Iran as an unaccompanied asylum-seeking child in October 2021. He had been assessed by the Respondent, the London Borough of Newham, to be an adult aged between 21 and 25 years, with a likely age of 22.

In April 2023, Khatija successfully obtained interim relief for the Applicant, with the effect that Newham was ordered to treat him in accordance with his claimed age pending the Tribunal’s determination of his claim.

The matter was determined following a five-day fact-finding hearing heard over February and March 2024. It is of note that the Tribunal: (i) accepted that the “short-form” assessment of the Applicant’s age carried out by the Kent Intake Unit should not be afforded “any weight” by the Tribunal either as evidence of the Applicant’s age or as evidence concerning the Applicant’s credibility; (ii) accepted that the Applicant’s failure to produce an identity document should not support an adverse inference against his claimed age in circumstances where he had a genuine fear of contacting his family in Iran; (iii) gave weight to the evidence of RK’s peers and the evidence of the Applicant’s litigation friend; and (iv) accepted the Applicant’s submission that the nature of the his relationship with his social worker, which the social worker conceded in cross-examination was not “a relationship characterised by trust”, was relevant to the weight the Upper Tribunal could attach to her evidence as to the Applicant’s age.

The Tribunal accordingly accepted that the Applicant was of his claimed age.

Khatija Hafesji represented the Applicant and was instructed by Alex McMahon of Osbornes Law Solicitors.

International Distribution Services Limited (formerly Royal Mail plc) has been served with a £878m collective action on behalf of an estimated 290,000 purchasers of bulk mail.

In 2018, Ofcom found that Royal Mail abused a dominant position in 2014 to exclude a competing provider, Whistl, from the market for bulk mail delivery services. Ofcom fined Royal Mail £50m for that conduct. Ofcom’s conclusions and the fine were upheld on appeal by the CAT and Court of Appeal.

The claim is brought on behalf of all persons who purchased or paid for relevant bulk mail services at any time after 10 January 2014. Bulk mail is a type of mail typically sent by organisations such as NHS Trusts, retailers, charities, local authorities, banks, utility companies, advertisers and publishers.  It includes bills, council tax statements, bank statements, charity fundraising appeals, advertising mail and some magazine subscriptions.

Paul Harris KC, Ben Rayment and Will Perry are instructed by Lewis Silkin LLP for the Proposed Class Representative, Bulk Mail Claim Limited.

Mr Robin Aaronson, the PCR’s sole director, was previously a member of the Competition Commission and PostComm.

For press coverage, see The Guardian.

Vicki Shotbolt, a prominent campaigner for children’s digital rights, has launched opt-out collective proceedings in the Competition Appeal Tribunal against Valve Corporation. Valve operates Steam, the world’s largest PC game distribution platform. The claim, which is brought on behalf of around 14m gamers, alleges that Valve has abused a dominant position with the result that consumers have been overcharged for games and in-game content on Steam and other platforms. Proceedings are estimated to be worth up to £656m. The claim website is here.

Robert Palmer KC, Julian Gregory and Will Perry are instructed by Milberg London LLP for the class representative. The claim is funded by Bench Walk Advisors and supported by economists from the Berkeley Research Group.

Media coverage includes the BBC, City AM and The Independent.

In the latest round of the dispute between Sports Direct and Newcastle United about the supply of the club’s replica kit, the Court of Appeal today confirmed the earlier decision of the Competition Appeal Tribunal not to grant Sports Direct an interim injunction, but found that the Tribunal had erred in finding that there was no serious issue to be tried.

Sports Direct had argued that it should be entitled to supply of Newcastle replica kit for the 2024/5 season and beyond, having been a retailer of the kit for many years, and had sought an interim injunction to secure supply in time for the planned summer launch and ahead of a trial of the matter.  In April, the Tribunal refused the application, deciding that Sports Direct had not established a “serious issue to be tried”, and that in any event the balance of convenience lay in favour of the club. It nevertheless held that the matter should proceed to a speedy trial.

Following an expedited, rolled up hearing, the Court of Appeal upheld that decision. It found that the Tribunal had been wrong to decide that there was no serious to be tried, but that this did not affect the Tribunal’s reasoning on the balance on convenience.

As regards the question of whether there was a serious issue to be tried, the Court held that the Tribunal fell into error in disregarding contested facts. It should have approached the question on the basis that “the claimant’s allegations of primary fact must (unless plainly fanciful, which is not the case here) be accepted as true and allowance must be made for the possibility that further facts may emerge on discovery or at trial”. The Tribunal had thus been incorrect to find that Sports Direct had not met the requisite standard. The Tribunal had been entitled though to take into account its view of the weakness of Sports Direct’s case in relation to the balance of convenience.

Alison Berridge appeared for Newcastle United, and Stefan Kuppen appeared for Sports Direct.

The Court of Appeal’s judgment is available here.

Spottiswoode v Nexans France SAS & others [2024] CAT 31

Clare Spottiswoode CBE has been authorised by the Competition Appeal Tribunal to act as the class representative in collective proceedings seeking to recover damages for any loss which flowed through to domestic electricity bills in Britain from the power cables cartel identified by the European Commission.

Fiona Banks and Jack Williams act for Prysmian, led by Jemima Stratford KC (instructed by Macfarlanes LLP).

Michael Armitage acts for NKT, led by Victoria Wakefield KC (instructed by Addleshaw Goddard LLP).

The full judgment can be read here.

On 30 April 2024, the Competition Appeal Tribunal approved a settlement for rail passengers in the ‘Boundary Fares’ collective proceedings against Stagecoach South Western Trains. The collective settlement marks the first time that consumers stand to receive compensation under the collective proceedings regime since it was introduced in 2015.

In the proceedings, Mr Gutmann, the Class Representative, alleged that Stagecoach had abused a dominant position by failing to make Boundary Fares sufficiently available, or to use its best endeavours to ensure a general awareness among customers of Boundary Fares. Boundary Fares are a type of extension ticket for use in conjunction with a TfL Travelcard. Stagecoach denies liability.

In an oral ruling, the Tribunal held that the proposed settlement, as revised over the course of the hearing, is just and reasonable. A written ruling is expected to follow.

The proceedings against London & South Eastern Railway, Govia Thameslink Railway Limited and First MTR South Western Trains continue, with a trial on the alleged abuse due to start in June 2024.

Philip Moser KC, Stefan Kuppen and Alexandra Littlewood (instructed by Charles Lyndon Ltd) represented Mr Gutmann.

James Bourke (instructed by Slaughter and May) represented First MTR.

The Chancellor of the High Court has refused an application for permission to appeal brought by Ms Julie Hunter against the ruling of the Competition Appeal Tribunal, which determined that the nature of the claim brought by Mr Philip Hammond against Amazon on behalf of UK consumers made him more suitable than Ms Hunter to act as the proposed class representative.  The Chancellor cited the remarks of Green LJ in Evans v Barclays Bank [2023] EWCA Civ 876 at [146] (a case which also concerned a “carriage” dispute as to which of two candidates should be the class representative in collective proceedings): “’The choice made by the CAT majority was a quintessential multifactorial evaluation. The CAT considered in the round a variety of factors relevant to who could conduct the proceedings best. The challenge is as to the weight the CAT attached to the various considerations as to which the CAT, as the expert in how proceedings play out at the nuts and bolts level, is vastly better placed than the Court of Appeal to form a view. The threshold for persuading the Court of Appeal to reverse the CAT’s decision is commensurately high.’ That statement of principle is equally applicable here, where the CAT has engaged in exactly that multifactorial evaluation and has preferred the methodology of Mr Hammond and his expert to that of Ms Hunter and her expert.”

Applying that approach the Chancellor concluded: “I do not consider that there was any error in the Ruling, let alone an error of law. The CAT simply preferred Mr Hammond’s expert’s methodology, a multifactorial evaluation which it was entitled to make. The proposed appeal comes nowhere near satisfying the high threshold for interference by the Court of Appeal to which Evans refers.”

The ruling on permission underlines the high bar which the losing party to a carriage dispute will have to overcome in or der to appeal to the Court of Appeal.

Philip Moser KC and Ben Rayment are instructed for Mr Hammond by Charles Lyndon Limited and Hagens Berman EMEA LLP.

Jon Turner KC is instructed by Herbert Smith Freehills LLP for Amazon.

The Tribunal today rejected an application by Sports Direct for an interim injunction requiring Newcastle United Football Club to supply it with replica kit for the 2024/5 season.

Sports Direct argued that the club was dominant in the supply of Newcastle replica kit, and that refusing to supply that kit to Sports Direct was an abuse of that dominance; alternatively, that exclusivity arrangements the club had entered into with JD Sports were anti-competitive and therefore unlawful. It further argued that if it did not have supplies of the replica kit for the 2024/5 season, it would suffer harm that could not be compensated by damages.

Applying the principles in American Cyanamid, the Tribunal considered whether Sports Direct had established a “serious issue to be tried”, and found that it had not. It was not arguable that ceasing an existing supply arrangement was – of itself and without more – an abuse, even assuming dominance. In the present circumstances Sports Direct had a low expectation of continuing supply, and the new owners of the club were entitled to revisit the distribution arrangements for the club’s replica kit. The Tribunal further found that, if an infringement of the Chapter II prohibition was arguable, it could also be argued that the exclusivity arrangements the club had entered into were improperly collusive but, conversely, that absent an arguable claim in regard to the Chapter II prohibition, it could not discern any arguable infringement of the Chapter I prohibition.

Although that finding was sufficient to dispose of the application, the Tribunal went on to consider the remaining stages of the analysis in American Cyanamid. It concluded that neither party could be adequately compensated in damages in relation to the granting or not granting of the injunction, as the potential losses were material and difficult to quantity. Finally, it determined that the balance of convenience weighed against the granting of an injunction, in particular because it would disturb the business arrangements the club had put in place for the 2024/5 season.

The Tribunal indicated that it considered that its refusal of interim relief made the need for a speedy trial of the matter more urgent, and urged the parties to give careful consideration as to how quickly a trial could come on, focussing on the necessary (and not merely desirable) procedural steps in the run up to trial.

Alison Berridge appeared for Newcastle United, and Stefan Kuppen appeared for Sports Direct.