Transcript Pay for delay agreements: an unworthy target?

Private Damages Actions
in the UK
Laura Elizabeth John
Barrister
Monckton Chambers
Andrew B. Bullion
Partner
Hausfeld & Co LLP
Overview
1. Engagement and funding
2. Prepare claim for filing
3. Choose the parties: main claim and contribution claims;
representative actions
4. Obtain the relevant regulatory decision
5. Disclosure
6. Witness statements
7. Experts’ reports
8. Pre-Trial Review
9. Hearing
10. Post-hearing quantification exercise?
1. Engagement Structure and Funding of private damages claims
Engagement
•
Following the Civil litigation reform (“Jackson reform”) of 1 April 2013, two contingency fee engagement
structures are available to competition lawyers:
 Conditional Fee Agreements (CFA) – On success, solicitor recovers their fees (i.e. the “base rate”) and
a success fee which can be up to 100% of the base rate (section 44(4) LASOP 2012). The success fee is
only recoverable from the client not the Defendant.
 Damages Based Agreements (DBA) – If the claim succeeds, solicitor can receive up to 50% of the
client’s damages but no fee arises if the action fails. But:
 Any solicitors’ fees and Counsel’s fees recovered from the Defendant must be deducted from the
contingency fee to which the solicitor would otherwise be entitled;
 Contingency fee acts as a cap on the amount recoverable from a Defendant; and
 Other “expenses” e.g. expert fees can be recovered from the client in addition to the contingency
fee to the extent not recovered from the Defendant.
Funding
•
There is a growing market in litigation funding whereby litigation funders “invest” in claims for a return on
their investment if damages are awarded or settlement is reached
Insurance
•
ATE premium cannot now be recovered from the Defendant (s46(1) LASPO 2012)
2. Preparing a Claim
•
Period of the infringement and affected markets
•
Purchase data
•
Overcharge and pass-on considerations
•
Umbrella damages
•
Applicable law
•
Choice of forum
 High Court
 6-year limitation period suspended “until the claimant knows or ought to have known of the injury”.
 Competition Appeal Tribunal (“CAT”)
 2-year limitation period from the date on which the infringement decision became final as against
each individual addressee (i.e. when the time for that individual addressee to appeal the
infringement decision expired, or the appeal against infringement was finally determined). Limitation
periods are individual to each addressee and unaffected by the ongoing appeals of any other
addressee (Deutsche Bahn [2014] UKSC 24).
 Consumer Rights Bill (expected to come into force in October 2015)
 Expands the jurisdiction of the CAT to hear stand-alone as well as follow-on claims.
 Aligns the limitation periods for High Court & CAT at 6 years from the date on which the cause of
action accrued.
3A. Parties: Main Claim/Contribution
•
Cartelists are jointly and severally liable for the loss caused by a cartel, therefore a Claimant
may pursue one cartelist for the whole loss suffered as a result of the cartel.
•
For claims against multiple Defendants domiciled in different Member States:
 The general rule under Article 2(1) of the Brussels Regulation is that Defendants should
be sued in the country in which they are domiciled.
 Where Defendants are domiciled in different jurisdictions, Article 6(1) of the Brussels
Regulation allows the claim to be brought in the jurisdiction which any of the Defendants
is domiciled provided the claims are “closely connected” (this condition is satisfied where
a claim is brought in respect of the same cartel).
•
Contribution Claims – CPR Part 20:
 Where the claim is not brought against all of the cartelists, a Defendant will commonly
seek to bring contribution proceedings against their fellow cartelists, for contribution or
indemnity.
 While such claims can be brought up to 2 years from the date of judgment in the main
claim, Defendants will commonly seek to file such proceedings earlier to involve the other
cartelists in the claim at an early stage.
3B. Parties: Representative Actions
• Opt-in class actions already possible under s47B CA98 (as
amended by EA 2002)
• To date, only one such action has ever been brought cf. JJB
Football Shirts
• Legislative Developments:
 Consumer Rights Bill - expected to become law in October 2015:
Introduces opt-out collective actions for UK domiciled Claimants and
extends opt-in collective actions to non-UK domiciled Claimants.
These actions can be brought in the CAT.
 In March 2014, the CAT published its draft Rules on Collective Actions
which set out more detail on the procedure relating to collective
proceedings and collective settlements.
Making Progress
National Grid Electricity Transmission v ABB & Others [2009] EWHC
1326 (Ch), para 44
“… the proper balance, in my judgment, requires me to allow this action to
proceed at least to the close of pleadings. In addition I consider that it is
premature to decide that no disclosure should take place before the conclusion
of the applications and appeals to the CFI and the ECJ. In principle, therefore, I
accept the submissions of counsel for NGET that the action should proceed to
the stage of the close of pleadings, the parties advisers should meet to consider
the scope and basis for proceeding with disclosure and that that topic and the
need or desirability for other directions should be reconsidered at a case
management conference to be held in October 2009. I reach this conclusion
because I consider that in the circumstances of this case, in particular the time
which has already elapsed since the occurrence of the relevant events, the need
for the follow on action to be processed so as to be as ready for trial as soon
after the conclusion of the proceedings before the CFI and ECJ are concluded as
is reasonably possible outweighs the need to avoid expenditure which may be
wasted if and to the extent that it is not compensated for by an award of costs...”
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4. The regulatory decision:
the problem…
• The Commission cannot publish:
 Leniency material: Leniency Notice, para 40
 Confidential information: Article 30(2) of Regulation 1/2003
 Findings of infringement against non-addressees: Case T-474/04
Pergan Hilfsstoffe [2007] ECR II-4225
• Where there is a dispute, publication must await a determination
by the GC: Case C-278/13P(R) Commission v Pilkington Group,
EU:C:2013:558
• Regulation 1049/2001 does not assist: Case T-380/08 Netherlands
v Commission, EU:T:2013:480
• Article 15(1) of Regulation 1/2003 does not assist: Case T-164/12
Alstom v Commission, EU:T:2012:637
4. The regulatory decision: the Court’s
attempted solution…
Can national courts require the parties to disclose?
• Based on an individual assessment of the passages in question:
National Grid v ABB & Others [2012] EWHC 869 (Ch)
• After obtaining the Commission’s comments under Article 15 of
Regulation 1/2003: Secretary of State for Health & Others v Servier;
WM Morrison Supermarket v MasterCard
• Subject to a confidentiality ring and a prohibition on use outside the
instant proceedings: Emerald Supplies v British Airways [2014]
EWHC 3513 (Ch) (on appeal to the Court of Appeal, not yet
decided)
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5. Disclosure
“Standard” disclosure
“Specific” disclosure
CPR Rule 31.6
(a) the documents on which he
relies; and
(b) the documents which –
CPR Rule 31.5(1)
(b) the court may dispense with or limit
standard disclosure; and
(c) the parties may agree in writing to
dispense with or to limit standard
disclosure
CPR Rule 31.12(2) An order for specific
(i) adversely affect his own case;
(ii) adversely affect another party’s
case; or
(iii) support another party’s case;
and
(c) the documents which he is
required to disclose by a relevant
practice direction.
disclosure is an order that a party must
do one or more of the following things
(a) disclose documents or classes of
documents specified in the order;
(b) carry out a search to the extent stated in
the order;
(c) disclose any documents located as a
result of that search
6. Witness Statements
CPR Rule 32.(2): The court will order a party to serve on the other
parties any witness statement of the oral evidence which the party
serving the statement intends to rely on in relation to any issues of fact
to be decided at the trial.
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6. Witness Statements: the
defendants’ dilemma?
AstraZeneca v KRKA [2014] EWHC 84 (Pat)
“Where a party elects not to adduce evidence available to it in relation
to a relevant matter, the court may draw inferences of fact against that
party: Wisniewski v Central Manchester Health Authority [1998] Lloyds
Rep Med 223, 240; Herrington v British Railways Board [1972] AC 877,
930G-H (Lord Diplock); The Law Debenture Trust Co. Plc v Elektrim
[2009] EWHC 1801 (Ch), [176]. Since it must have been obvious to AZ
that evidence about its own cost-benefit analysis comparing the UK and
European markets would be relevant to assessment of this issue, which
had been raised by AZ itself, but it chose not to adduce such evidence, I
consider that the just and appropriate approach in the circumstances of
this case is to assess the counterfactual scenario on the footing that AZ
would not have dropped the price for Nexium in the face of significant
inroads into its market share by Emozul...”
7. Experts’ evidence
• Reports and reply reports: mutual exchange or sequential?
• CPR Rule 35.12: Meeting, and list of
agreement/disagreement
(1) The court may, at any stage, direct a discussion between experts for the
purpose of requiring the experts to –
(a) identify and discuss the expert issues in the proceedings; and
(b) where possible, reach an agreed opinion on those issues.
(2) The court may specify the issues which the experts must discuss.
(3) The court may direct that following a discussion between the experts they
must prepare a statement for the court setting out those issues on which –
(a) they agree; and
(b) they disagree, with a summary of their reasons for disagreeing.
7. Experts’ evidence: ‘hot-tubbing’
Concurrent expert evidence: Practice Direction 35, paragraph 11
11.1 At any stage in the proceedings the court may direct that some or all of the experts from like
disciplines shall give their evidence concurrently. The following procedure shall then apply.
11.2 The court may direct that the parties agree an agenda for the taking of concurrent evidence, based
upon the areas of disagreement identified in the experts' joint statements made pursuant to rule 35.12.
11.3 At the appropriate time the relevant experts will each take the oath or affirm. Unless the court
orders otherwise, the experts will then address the items on the agenda in the manner set out in
paragraph 11.4.
11.4 In relation to each issue on the agenda, and subject to the judge's discretion to modify the
procedure –
(1) the judge may initiate the discussion by asking the experts, in turn, for their views. Once an expert
has expressed a view the judge may ask questions about it. At one or more appropriate stages when
questioning a particular expert, the judge may invite the other expert to comment or to ask that
expert's own questions of the first expert;
(2) after the process set out in (1) has been completed for all the experts, the parties' representatives
may ask questions of them. While such questioning may be designed to test the correctness of an
expert's view, or seek clarification of it, it should not cover ground which has been fully explored
already. In general a full cross-examination or re-examination is neither necessary nor appropriate; and
(3) after the process set out in (2) has been completed, the judge may summarise the experts' different
positions on the issue and ask them to confirm or correct that summary.
10. Post-hearing quantification?
AstraZeneca v KRKA [2014] EWHC 84 (Pat)
•
•
Claim by a competitor
Brought under a cross-undertaking in damages
“76. I believe that these findings resolve the relevant outstanding
disputes between the parties, and allow for a final damages calculation
to be agreed by Mr MacGregor and Dr Jenkins. The parties should now
seek to agree the final figures and the order to be made by the court.
They have liberty to make further representations if other matters
require to be resolved by the court before a final order can be made.”
+44 (0)20 7405 7211
Laura Elizabeth John
Andrew B. Bullion
[email protected]
Monckton Chambers
[email protected]
Hausfeld & Co LLP