National Grid Electricity Transmission Plc v ABB Ltd & Ors

A national court considering a follow-on competition claim has a general discretion to decide when proceedings should be stayed while a Commission decision is under appeal. The court must prevent a judgment conflicting with the Commission or the Community courts, while applying the overriding objective and balancing the parties’ prejudice, expense, delay and evidential needs.

An immediate stay is not automatic. The court may permit pleadings and appropriate preparatory steps, including consideration of disclosure, where that is necessary to preserve evidence and place the parties on an equal footing. A claimant relying on a Commission decision must still prove loss and causation.

The claimant brought a High Court follow-on damages action arising from the European Commission’s decision concerning a cartel involving gas insulated switchgear. Several defendants had appealed the Decision to the Court of First Instance, with possible further appeals to the European Court of Justice.

The defendants sought an immediate stay pending completion of those appeals. The claimant accepted that the action could not proceed to trial before the Commission decision became definitive, but sought permission to serve and respond to defences and begin preparatory work. Siemens also sought further information concerning the alleged breaches and loss.

The issues were when the stay should take effect and whether Siemens was entitled to further information before serving a defence.

1. Stay. The court had to apply the principle in Masterfoods Ltd v HB Icecream Ltd [2000] ECR I-11369 and ensure that the action was not tried before the exhaustion of the relevant appeals. That did not require an immediate stay of all interlocutory steps. The timing of the stay was for the national court under its own procedural law.
2. The discretion had to be exercised in the light of the overriding objective. Relevant considerations included avoiding conflicting decisions, saving expense, proportionality, expedition, fairness, the parties’ equality of arms and the preservation of evidence. The principles stated by the Competition Appeal Tribunal in Emerson III [2008] CAT 8 were unobjectionable, but that decision concerned permission to commence proceedings and did not determine the different question before the court.
3. The Commission Decision established the relevant infringement against the undertakings to which it was addressed, but the claimant still had to prove loss. That included establishing the alleged overcharge and addressing whether any loss had been passed through to consumers. Delay could prejudice that inquiry because relevant evidence and documents might become unavailable.
4. Applying the approach in MTV Europe v BMG Records (UK) Ltd [1997] 1 CMLR 867, the proper balance required the action to proceed at least to the close of pleadings. The parties were to consider the scope of disclosure and return to court for case management. The action was not to be fixed for trial against any defendant until three months after that defendant had exhausted its rights of appeal.
5. Siemens’ requests for further information were dismissed. The action was in the High Court, so CAT practice directions did not govern it. Further information about loss was premature before Siemens had served a defence and before relevant disclosure.

First-instance decision. No prior appellate decision is stated in the judgment.