Roche Products Ltd. & Ors v Provimi Ltd

At the interlocutory stage, a claim for damages for infringement of Article 81(1) of the EC Treaty is arguable where a company forming part of the same undertaking as the cartel participant implemented the cartel, even without a pleaded concurrence of wills between those companies. Causation is also arguable where implementation may have contributed to cartel prices, although the claimant did not purchase from that company. Under Article 6(1) of Council Regulation 44/2001, closely connected claims should be heard together where potentially divergent national approaches create a risk of irreconcilable judgments. Contractual jurisdiction clauses are confined by their proper scope. Swiss, German and French clauses were insufficient to cover secret-cartel damages claims characterised as tortious or involving fraud.

The European Commission found that vitamin manufacturers had operated cartels contrary to Article 81 of the EC Treaty. Purchasers brought four Commercial Court actions against companies in the Roche and Aventis groups, alleging that companies within the relevant undertakings had participated in, implemented and given effect to the cartels.

The defendants applied to strike out parts of the claims, obtain summary judgment, or establish that the English court lacked jurisdiction. The issues included whether subsidiaries implementing cartel arrangements could themselves be liable for infringement and loss; whether Article 6(1) jurisdiction could be used to join foreign defendants; and whether Swiss, German or French jurisdiction clauses covered the claims.

The applications were rejected. The claims of Trouw Germany against the English companies were allowed to proceed, and the related jurisdiction challenges failed.

1. Article 81 claims. Article 81 of the EC Treaty imposed obligations directly enforceable in English law under section 2(1) of the European Communities Act 1972. Following Garden Cottage Foods Ltd v Milk Marketing Board [1984] 1 AC 130, the pleaded cause of action was capable of being a claim for breach of statutory duty. A company forming part of the same undertaking as the cartel participant could arguably infringe Article 81(1) by implementing a cartel entered into by its parent company and independent undertakings. A separate pleaded concurrence of wills between the companies within the same economic unit was unnecessary. The court distinguished Viho v Commission [1996] ECR I-5457, which concerned arrangements internal to a single economic unit.
2. Causation and strike-out. At this stage the claimants needed only to show an arguable case or real issue. It was arguable that, without the cartels, competition between the Roche and Aventis undertakings might have produced lower prices. Each company implementing the cartel could therefore arguably have contributed to the alleged loss, even where the claimant had not purchased from that company.
3. Article 6(1). The claims against the defendants were closely connected because they arose from the same alleged infringements and were identical private-law damages claims. The undeveloped state of the law and the possibility of different national approaches created a real risk of irreconcilable judgments. It was therefore expedient to hear the claims together under Article 6(1) of Council Regulation 44/2001.
4. Jurisdiction clauses. The claimant had to show that it had much the better of the argument, having regard to the interlocutory nature of the applications. Under Articles 17 and 23 of the applicable instruments, validity and formal requirements were governed by those instruments, but the scope of a clause was determined under the applicable national law. The Swiss clauses were confined to disputes reasonably foreseeable when the contracts were made and did not cover secret-cartel damages. The German clauses were insufficiently clear to cover claims based on fraud or a tort of intent, and the courts could not rewrite them. The French claims were probably tortious; neither the 1998 nor 1999 clause was wide enough to cover them. The defendants therefore could not rely on the clauses to displace English jurisdiction.