High Court dismisses claim against Google, holding that, where a pro-competitive innovation by a dominant company is alleged to have harmed competition on a related market, the effect on competition in that market must be serious or appreciable in order to constitute an abuse of dominance.

In a judgment handed down today, the High Court dismissed a claim for abuse of dominance brought against Google by online map provider Streetmap.

Streetmap alleged that, by displaying a clickable image of a map, taken from Google Maps, at the top of its search engine results page in response to certain search queries, Google gave Google Maps an unfair advantage over other online map providers, and thereby abused its (assumed) dominant position in the market for online search.

In an important judgment on the application of competition law (The prohibition on abuse of dominance is contained in Article 102 of the Treaty on the Functioning of the European Union and Chapter II of the Competition Act 1998) in rapidly developing online markets, Mr Justice Roth rejected Streetmap’s case, holding that:

• since the introduction of a clickable map image on its search page was a pro-competitive measure on the market where Google was dominant, for its conduct to be abusive, it had to be reasonably likely to have a serious or appreciable effect on competition in the related market for online maps;
• on all the evidence, the introduction of the clickable map image on Google’s search page had not taken custom away from Streetmap.  Therefore, it was not reasonably likely to gives rise to anti-competitive foreclosure;
• in any event, Google’s conduct was objectively justified.  Since the alternative technical solutions proposed by Streetmap would have entailed significant practical problems, or imposed a substantial additional burden on Google, it had not been required to implement them by any obligation of proportionality.

Google was represented by Jon Turner QC, Josh Holmes and Ben Lask.

To view the full judgment, please click here.

A full case note will be issued shortly.

The Chinese dissident Wang Yam was jailed for life for the murder of the reclusive author Allan Chappelow. In the criminal trial, for unspecified national security and witness protection reasons, the trial judge ordered that the defence case should be heard in secret.

Mr Yam subsequently applied to the European Court of Human Rights in Strasbourg (“ECtHR”), arguing that the secret trial constituted a breach of his right to a fair trial under Article 6 ECHR. By an order of the English court, however, Mr Yam was prevented from disclosing any information regarding the secret aspects of his trial, or the reasons for the secrecy, to the ECtHR.

On appeal, the Supreme Court upheld the order, concluding that it was within the power of the lower court to prevent an applicant from placing material before the ECtHR. It held that it was for the ECtHR to decide whether such disclosure was really required and that, in any event, there was a common law power pursuant to which an order for non-disclosure to the ECtHR could be made. The case in the ECtHR remains ongoing.

A copy of the judgment can be found here.

Nikolaus Grubeck, led by Lord Pannick QC and Kirsty Brimelow QC, acted for the Appellant.

Press coverage includes: BBC, The Guardian, London Review of Books.

In a judgment released today, the Court of Appeal held that the UK Medicines and Healthcare Regulatory Agency had acted lawfully in carrying out inspections of Roche in late 2013 and in communicating material from that inspection to the European Medicines Agency.

On a previous inspection in 2012, critical deficiencies had been found in Roche’s pharmacovigilance system (pharmacovigilance is the obligation on a pharmaceutical company to monitor and pass on to the authorities reports of adverse reactions to, and lack of therapeutic effect of, its medicines).  The European Commission had then asked the EMA to consider action against Roche under the EU Penalties Regulation – action that could result in a large fine against Roche.

The 2013 inspections were carried out under the general MHRA’s powers to inspect: such inspections are routine in cases where critical deficiencies have previously been identified in order to ensure that the deficiencies have been corrected.  Roche’s claim that the MHRA had not acted lawfully centred on the fact that the EMA had, before the inspections, made a request under Article 8(3) of the Penalties Regulation for information derived from the inspections to be passed to the EMA.  Roche claimed that in the circumstances the MHRA had acted unfairly.  Roche also sought a reference for a preliminary ruling from the Court of Justice of the EU on (a) whether the EMA had power to make such a request of the MHRA under Article 8(3) and (b) whether the MHRA was right to take the view, in its reports to the EMA, that the Roche company being inspected was responsible under the Penalties Regulation for pharmacovigilance deficiencies by another group company.

The Court of Appeal rejected its claim of unfairness and refused a reference.  On the question of unfairness, Sales LJ (giving the lead judgment) agreed with the trial judge (Carr J) that there was no unfairness.  The Court agreed with the MHRA’s submissions that the legislative framework clearly contemplated that information from routine inspections could be passed to the EMA and used in for the purposes of the Penalties Regulation.  The Court also agreed with the MHRA that it “rather strained credulity” that Roche’s experienced representatives during the inspections were “ingénus” who could not be taken to have understood that that was likely to happen.  In her concurring judgment, Arden LJ noted that where the EU legislator had created a regime such as the Penalties Regulation, with a number of procedural protections, the English court should be slow to find a breach of the common law duty of fairness.

The Court went further than had Carr J in upholding the MHRA’s case that it was acte clair that Article 8(3) permitted the EMA to make the request that it had made to the MHRA: there was therefore no basis for a reference to the CJEU.  But the Court also agreed with Carr J that, since the Article 8(3) request had not in fact affected to Roche’s disadvantage the information that would have been passed to the EMA in any event, the Court would not anyway have granted declaratory relief about that issue.  As to the question of Roche’s responsibility under the Penalties Regulation for deficiencies of its group company, the Court of Appeal agreed with the MHRA’s submissions that the situation where the MHRA might have expressed views to the EMA and European Commission (which would then have to decide if those views were right, any decision being challengeable on appeal to the General Court) was far from the type of situation where a court would grant declaratory relief of a view expressed by a Government department.

The judgment is important both for its account of the relationship between the Penalties Regulation and the powers of inspection set out in the Medicines Directive, but also more generally in dealing with the situations in which the Court will make references to the CJEU in a context where what is being sought is declaratory relief.

George Peretz QC represented the MHRA.

A copy of the judgment can be found here.

The High Court has today dismissed Enfield Council’s judicial review of the Department for Transport’s minimum service specification for the ongoing East Anglia rail franchise competition.

The East Anglia franchise serves 131 train stations, extending to Peterborough, Southend, Felixstowe and Cambridge, and includes a significant part of London.  A competition is underway to select the train operating company that will take over the operation of the rail services when the current franchise comes to an end in October 2016.

In September 2015 the Department for Transport issued to intending bidders for the franchise an Invitation To Tender (ITT), to which was attached a Train Service Requirement document setting out the minimum services to be provided at each station.  Enfield Council issued a judicial review claim challenging the ITT because, contrary to the Council’s expectation, the Train Service Requirement did not specify a service of 4 trains per hour throughout the day for Angel Road train station.  Instead, the Train Service Requirement specified a service for Angel Road station reaching 4 trains per hour only during the evening peak hours, meaning that the station is likely to be served by fewer trains at other times of the day.

The Council’s challenge alleged that the ‘failure’ to specify a service of 4 trains per hour throughout the day was unlawful because it breached the Council’s legitimate expectations arising from certain assurances given by Department for Transport officials.  The Council also alleged that the Department for Transport was unreasonable in basing its service specification on economic modelling that took account only of transport-related costs and benefits, and therefore did not give any weight to the risk to the viability of a new housing development project (known as the ‘Meridian Water’ scheme) in the Angel Road area in circumstances where a 4 trains per hour service was not provided.  The Council also argued that, by not taking account of that risk to a development that could make available a significant number of new ‘affordable homes’ in London, the Department for Transport had breached its duties under the Public Services (Social Value) Act 2012.

Dismissing the challenge in full, Mrs Justice Elisabeth Laing held that the Council did not have a legitimate expectation for a 4 trains per hour service; and, further, the Department for Transport had been entitled to rely on economic modelling focussed on transport-related costs and benefits, and therefore to leave out of account the risk to the Council’s Meridian Water development scheme.  Such an approach was not contrary to the Public Services (Social Value) Act 2012.

Monckton barrister Alan Bates appeared on behalf of the Department for Transport.

In judgments handed down yesterday the General Court of the EU has annulled the Commission’s 2010 decision finding the applicant companies to have infringed the competition rules by participating in a cartel to fix surcharges for air freight and imposing heavy fines upon them.

The basis for the Court’s ruling was that the reasoning in the decision found a single infringement: however, the final part of the decision setting out the infringement (“the operative part”) set out four separate infringements with different airlines participating in each.  The Commission argued at the hearing that that was because, over the period of the cartel, the EU Treaty, the EEA agreement, and the EU/Switzerland Agreement applied to different routes (e.g. the EU/Switzerland Agreement applied only to routes between the EU and Switzerland) and that the airlines listed in relation to each of those provisions were the airlines that flew the routes to which the provision applied (so that only airlines that flew between the EU and Switzerland were listed as having infringed the EU/Switzerland agreement).  However, the Court considered that there was such a contradiction between the reasoning in the decision and the operative part that the decision had to be annulled on the basis of contradictory reasoning.

The Court found it unnecessary to deal with any of the other arguments put forward by the applicants contesting their participation in the infringement or the amount of the fine.

As matters stand, to the extent that the decision is annulled, it no longer stands against any of the applicants to the Court, and no longer binds national courts (which are currently considering a number of follow-on actions based on the Commission’s decision).

George Peretz QC, Josh Holmes, Alan Bates and James Bourke acted for the European Commission; Jon Turner QC acted for British Airways and Ronit Kreisberger acted for Cathay.  In the follow-on damages actions in the English High Court: Paul Harris QC, Ben Rayment and Anneliese Blackwood are acting for Emerald Supplies Limited, Rob Williams acts for the Allston Landing Claimants, Jon Turner QC and Michael Armitage are acting for British Airways, Michael Bowsher QC, Tim Ward QC, Daniel Beard QC, Kassie Smith QC, Meredith Pickford QC, Ronit Kreisberger, Philip Woolfe, Laura Elizabeth John and Thomas Sebastian are acting for numerous Part 20 Defendants.

The Chartered Institute of Library and Information Professionals (CILIP) today announced that it was challenging the Department of Culture Media and Sport concerning its oversight of library services under the Public Libraries and Museums Act 1964.

Part of its campaign entitled My Library My Right championing public access to quality library services, CILIP is asking the Secretary of State to issue clear statutory guidance on the duty of local authorities to provide a “comprehensive and efficient” library service under section 7 of the 1964 Act.

Eric Metcalfe is acting for CILIP. Please click here for media coverage by the Guardian.

Leeds City Council v HM Revenue and Customs [2015] EWCA Civ 1293

The Court of Appeal has rejected Leeds City Council’s EU law challenges to the former 3 year limitation period in section 80(4) of the Value Added Tax Act 1994 on claims for VAT over-declared and overpaid in VAT periods ending on or after the introduction of the cap in December 1996 (so-called “Scottish Equitable” claims).  Dismissing Leeds’ appeal against the “impeccable” decision of the Upper Tribunal (Tax and Chancery Chamber), the Court of Appeal rejected various EU law arguments (invoking the principles of effectiveness, equivalence and legal certainty) that the 3 year cap had to be disapplied in relation to Leeds’ claims in circumstances where Leeds did not know it had claims and HMRC’s (erstwhile) public position had been inconsistent with the correct tax treatment of the supplies in question.

Andrew Macnab acted for HM Revenue and Customs

To view the full judgment please click here.

 

The High Court has discharged an injunction that was obtained by Packet Media Limited (“PML”) against Telefonica UK (“TUK”) in July 2015. PML operates GSM Gateways and provides telecommunications services to its own business customers. The use of those Gateways was contrary to TUK’s Gateway Policy. PML sought to restrain TUK from disconnecting the SIM cards that PML were using to provide access and origination services to its customers. It did so on the basis that it was arguable that TUK were dominant on the market for the wholesale supply of access and origination services and was abusing that dominance. TUK had been given liberty to discharge the injunction and applied to do so by reference, inter alia, to public statements by Ofcom that that market was highly competitive. The Court found that the contention that TUK were dominant on that market did not give rise to a serious to be tried. The injunction will be discharged within two weeks and the Claim was struck out.

Brendan McGurk acted for Telefonica

In a case which it described at the permission stage as one of “particular public interest”, the Supreme Court has allowed an appeal by the Competition and Markets Authority (CMA) against the decision by the Court of Appeal that the acquisition by Eurotunnel of 3 out of Seafrance’s 4 ferries, together with certain other business assets, which had not traded at the time of the acquisition for some seven and a half months, did not amount to an “enterprise” (i.e. “the activities or part of the activities of a business”) so as to give rise to a “relevant merger situation” over which the CMA had jurisdiction.   This was the first time the jurisdiction provisions of UK merger control had been considered by the UK’s highest court for over 20 years.   The appeal raised the issue of when acquired assets are simply “bare assets” and when the can be considered to involve the acquisition of a business (or part of one) and therefore subject to UK merger control.  As part of its analysis the Court considered when employees can be said to be transferred as part of an acquisition in the absence of a transfer of employment contracts.

Ben Rayment was instructed by the CMA

For a copy of the Supreme Court’s Judgment click here.