Media-Saturn Holding GmbH & Ors v Toshiba Information Systems (UK) Ltd & Ors

The claimants sued a number of Toshiba and Panasonic group companies for damages arising from a CPT cartel the Commission found in Case COMP/39437 and relied on Article 101 TFEU (and Article 53 EEA). The defendants (principally TIS and PE) applied to strike out and/or obtain summary judgment. Central legal issues were (i) whether members of corporate groups could be held liable by reason of 'decisive influence' or on the so-called Provimi basis, (ii) whether entities that sold transformed products (CTVs incorporating cartelised CPTs) could be said to have implemented the cartel, (iii) whether parent-company knowledge could be attributed to subsidiaries by means such as shadow/de facto directorship or EU law attribution, and (iv) whether English economic tort claims (unlawful means conspiracy / unlawful interference) were tenable.

The judge held that the EU law claims against TIS and PE were not suitable for summary disposal: there was an arguable factual case that TIS and PE had implemented or participated in the cartel (including via transformed products), and both the Decisive Influence and Provimi lines of attribution remained arguable in the light of the Commission Decision and subsequent EU case law (including Biogaran and other authorities). The court granted permission to amend to plead shadow/de facto directorship issues. By contrast the English economic tort claims were struck out against TIS and PE because there was no arguable evidence that either defendant had the requisite intention to injure the claimants as required by Newson/Emerald and related authority. Finally, the court held that Article 8(1) Recast Brussels Regulation provided a good arguable basis for jurisdiction over PME and PI (the Panasonic defendants to the Second Claim) and refused to decline jurisdiction on the grounds advanced by those defendants; the EU claims against PME and PI were also held to be arguable but the economic tort claims against them were not.

The claimants are Media-Saturn and associated retail entities. They sued Toshiba and Panasonic group companies for damages for overcharges on colour televisions allegedly resulting from a cartel in colour picture tubes (CPTs) found by the European Commission in Case COMP/39437. The First Claim was brought against Toshiba entities TIS, TEEG and TEG and against PE (originally PE, later substituted by Panasonic Europe B.V.). A separate Second Claim was brought against PME and PI. None of the claimants purchased in the United Kingdom; most purchases occurred in Germany.

Relief sought: strike out and/or summary judgment by defendants under CPR 3.4 and CPR 24 in respect of the First Claim; orders that the English court lacks jurisdiction over certain defendants under Article 8(1) RBR; permission to amend and consolidation.

Issues framed by the court:

• whether the particulars disclosed reasonable grounds and a real prospect of success for EU law claims (Article 101 TFEU / Article 53 EEA) against TIS and PE;
• whether knowledge and liability could be attributed by (a) the Decisive Influence Ground, (b) the Provimi Ground, or (c) by shadow/de facto directorship principles;
• whether conduct consisting of sales of transformed products or intra-group transfers can amount to 'implementation' of a cartel;
• whether English economic torts (conspiracy to injure by unlawful means; unlawful interference with business) were arguable, in particular whether the defendants had the necessary intent to injure;
• whether the English court had jurisdiction under Article 8(1) RBR to hear claims against PME and PI.

Court's reasoning (concise):

• The judge applied established strike-out and summary judgment principles (CPR 3.4, 24.2 and authorities such as Easy Air / Swain v Hillman), but allowed that cartel cases feature information asymmetry; nonetheless pleadings must be sufficient and summary disposal is possible where claims lack any real prospect of success.
• On the EU law claims the judge found that it was at least arguable that TIS and PE engaged in activities that could amount to participation or implementation of the cartel (notably manufacture and sale of CTVs incorporating cartelised CPTs, intra-group sales, bonus agreements and group structures). The Commission had found implementation through transformed products; the CJEU jurisprudence (including LG/Philips on transformed products) supported that view. The Decisive Influence Ground was established in principle by CJEU authority (Evonik Degussa and related cases) and the Provimi point remained arguable, particularly in light of the General Court's subsequent Biogaran decision which supported attribution within a single economic unit where components contributed to the infringement.
• The court refused to strike out the EU claims against TIS and PE and granted permission to amend to plead shadow/de facto directorship so as to seek to attribute parent knowledge to subsidiaries; that allegation was not bound to fail at this stage.
• By contrast, on the English economic tort claims the judge followed Newson and Emerald and held that the claimants had no real prospect of proving the necessary intention to injure. Mere foreseeability that the overcharge might be passed on (or not) did not suffice; the typical cartel situation did not show the requisite intention to injure a particular claimant. Accordingly the domestic tort claims failed against TIS and PE (and likewise against PME and PI on the material before the court).
• On jurisdiction the judge held that Article 8(1) RBR could be relied upon; it was reasonably foreseeable that PME and PI might be sued in England in circumstances where an anchor defendant was domiciled there and the claims were closely connected. The 'sole purpose' ousting argument was not established.

Wider context: the judgment emphasises the courts' caution about summary disposal in cartel damage claims because of information asymmetry but confirms that domestic economic torts remain limited by the requirement of an intention to injure and that EU attribution doctrines (decisive influence, single undertaking / Provimi-style arguments and successor liability principles such as discussed in Skanska) can be fact-intensive and are often unsuitable for summary disposal.

First instance judgment: The court dismissed the defendants' applications to strike out or obtain summary judgment in respect of the EU law claims against TIS and PE, concluding those claims had a real (arguable) prospect of success because participation/implementation (including via transformed products), and attribution under the Decisive Influence and Provimi grounds, were each arguable on the pleaded and evidential material. The court granted permission to amend to plead shadow/de facto directorship. Conversely, the court struck out the English economic tort claims (conspiracy by unlawful means and unlawful interference) against TIS and PE for want of the requisite intention to injure. The court also held that Article 8(1) Recast Brussels Regulation provided a good arguable basis for jurisdiction over PME and PI and found the EU claims against PME and PI to be arguable, but concluded the English economic tort claims against PME and PI lacked a real prospect of success for the same reasons as applied to TIS and PE.