A recent ruling by the Dutch Court of Appeal confirmed that claimants will need to sufficiently substantiate their claim that they suffered loss due to a cartel, even in follow-on cases. Despite a presumption that sales or service contracts concluded during the cartel period have been affected by the cartel, claimants will still need to provide the courts with concrete, detailed and uncluttered information showing (i) which party purchased (ii) which products from (iii) which manufacturer for (iv) which amount, preferably with copies of the relevant agreements.
Burying the courts under paperwork without any further specification or explanation will not do.
On 5 February 2019, the Court of Appeal of Arnhem-Leeuwarden ruled on the appeal brought by East West Debt B.V. (“EWD”) in the elevator cartel case. The Court confirmed an earlier judgment of the District Court of the Middle-Netherlands [see our August 2016 Newsletter] and dismissed all claims brought by EWD.
EWD based its claim on a 2007 Commission Decision, in which the defendant elevator manufacturers were held liable for a competition law infringement on the Dutch elevator market. The Court of Appeal held that this breach of European competition law does not automatically imply the existence of civil liability. To establish civil liability, the requirements of national tort law must be satisfied. Dutch tort law requires unlawfulness, imputability, relativity, loss and causation before a claim for damages can be successful. Each of these elements needs to be alleged and – if contested – proven by the claimant.
The Court of Appeal held that while the 2007 Commission Decision established that subsidiaries of the elevator manufacturers engaged in unlawful conduct which can be imputed to those entities, it does not automatically mean that claimants suffered loss due to competition law infringements. The bundling of claims by EWD through assignments does not change the fact that the claims brought forward by EWD are individual claims. These claims should be individually considered. Relying on the European principle of effectiveness, the Court of Appeal was prepared to assume that sales or service contracts entered into during the cartel period were affected by the cartel. However, that does not relieve the claimant from the burden to allege and prove the quantum of damages and causal link.
The Court of Appeal held that EWD simply failed to provide sufficient facts to substantiate its allegation that each of the assignors from whom EWD had acquired its claims had in fact been affected by the cartel. More specifically, the Court of Appeal considered that EWD failed to provide concrete information showing which party purchased which products from which manufacturer for which amount. According to the judgment, EWD could not content itself with providing unstructured aggregated data to the court and the defendants. Importantly, EWD’s argument that defendants should have searched for relevant information themselves was rejected. The Court of Appeal also held that since the assignment documentation referred to contracts entered into with the defendants only, EWD could not claim damages for loss caused by other elevator manufacturers that were not a defendant in the proceedings ("umbrella claims").
Finally, the Court mentioned that it had considered whether or not it should provide EWD with another opportunity to substantiate its claims. However, the Court held that in light of the principles of due process EWD should not be given another opportunity, given that EWD had already had several opportunities to substantiate its claims, had persisted in its procedural posture and the oral hearing on appeal had already taken place.
This article was published in the Competition Law Newsletter of February 2019. Other articles in this newsletter: