NYKK v Mark McClaren

The Court of Appeal allowed the appeal against a Competition Appeal Tribunal ruling that the Competition Appeal Tribunal Rules 2015 implied a general prohibition on defendants communicating directly with class members about collective proceedings without the Tribunal's permission. The court held that no such restriction is a necessary implication of the Rules and identified express Rule provisions (including Rule 94) and the structure and purpose of the Rules as pointing against the implication. The court emphasised that the CAT retains broad case management powers under Rules 53-56 and 88 to impose bespoke restrictions where necessary, and concluded that issues such as invasion of litigation privilege, interference with business communications, and comparative experience (notably Canadian jurisprudence) supported a case-by-case approach rather than a universal prohibition. The court also ruled that the correct procedural route for challenging the Ruling was by appeal under s.49(1A) of the Competition Act 1998 and allowed the appeal.

Background and parties. MMCR (Mark McLaren Class Representative Limited) brought follow-on collective proceedings in the Competition Appeal Tribunal on behalf of a wide class of purchasers of new motor vehicles, arising from an EU Commission cartel decision. The Shipping Companies (appellants) wrote letters before the opt-out deadline to 21 large business purchasers warning of possible disclosure obligations; MMCR applied for an order restraining further communications. The Tribunal (President Marcus Smith P, Eamonn Doran and Bridget Lucas KC) ruled that the Rules precluded defendants communicating with class members about collective proceedings without the CAT's permission, and made an order to that effect ([2022] CAT 53). The Shipping Companies challenged the Order.

Procedural posture. The challenge was pursued initially by judicial review but the Court constituted itself as a Court of Appeal and held that the correct route was by appeal under s.49(1A) Competition Act 1998 because interlocutory case-management decisions affecting how damages claims are run are within the scope of that appeal route. Permission to appeal was granted and the court heard the substantive challenge.

Nature of relief sought. The appellants sought to quash the CAT order restraining communications between defendants and class members; MMCR sought to uphold the Order. MMCR alternatively argued the Tribunal would have made the order in exercise of its case management powers.

Issues framed.

1. Issue 1: Do the Competition Appeal Tribunal Rules 2015 impose a general restriction precluding direct communications by defendants to class members about the collective proceedings without the Tribunal's permission?
2. Issue 2: If not, did the Tribunal in fact make the Order in exercise of its case management powers?
3. Issue 3: If the Tribunal did not, should the Order nevertheless be upheld on the basis that the Tribunal would or should have made it as a case management exercise?

Court's reasoning (concise). The court applied conventional principles of statutory interpretation and the high threshold for implying terms: an implication must be necessary and "compellingly clear." The court found no express Rule providing the blanket restriction and rejected the idea that the various provisions vesting formal communication functions in the class representative (e.g. Rules 81, 88, 91, 92, 94) amount to a necessary implied prohibition. Rule 94 (collective settlements) was specifically inconsistent with a universal ban because it prescribes particular handling of settlement offers. The court emphasised the contrast with ordinary civil practice, the existence of powerful case management powers in the Rules allowing tailored restrictions where required, the risk that a blanket prohibition would invade litigation privilege and impede defendants' legitimate business communications, and persuasive Canadian experience where no such general ban exists but courts address improper communications on a fact-sensitive basis. The Tribunal's Ruling did not, on its language, adopt an alternative case-management basis and the court declined to uphold the Order on a new case-management basis itself, leaving such bespoke decisions to the CAT. Article 10 (freedom of expression) issues were identified but not authoritatively decided on the material before the court.

Outcome. The Court of Appeal allowed the appeal: the Rules do not contain the implied prohibition; the Tribunal had not validly made the Order as a necessary implication; and the Tribunal did not demonstrate it had exercised case management powers as an alternative basis. The court remitted any case-specific application for tailored restrictions to the CAT.

Appeal allowed. The Court held that the Competition Appeal Tribunal Rules 2015 do not, as a matter of necessary implication, impose a general ban on defendants communicating directly with class members about collective proceedings without the Tribunal's permission. The restriction the Tribunal imposed was not compelled by the Rules, was inconsistent with express provisions (notably Rule 94), risked unfairly invading litigation privilege and commercial communications, and the CAT has adequate case management powers under the Rules to impose tailored restrictions where necessary. The Tribunal had not made the Order alternatively as a case management exercise, and the Court would not itself uphold the Order on that basis on the material before it. The appeal was therefore allowed and the CAT's Order set aside, with the CAT left free to consider any tailored case-management measures if appropriate.

The order under challenge was made by the Competition Appeal Tribunal in its Ruling of 18 November 2022 and Order of 20 December 2022 (reported at [2022] CAT 53). The appellants commenced judicial review proceedings and the matter was determined by the Court of Appeal sitting also as a Divisional Court; the court concluded the correct procedural route was an appeal under s.49(1A) Competition Act 1998 and allowed the appeal. Related earlier steps include the CPO application and certification proceedings (CPO judgment [2022] CAT 10) and interlocutory proceedings including orders dated 6 April 2023. Previous appeals and authority cited in the judgment include MOL (Europe Africa) Ltd & ors v Mark McLaren Class Representative Ltd [2022] EWCA Civ 1701 (which related to aspects of the same litigation).