On 11 December 2014, Advocate General Niilo Jääskinen issued his opinion in Case C-352/13, CDC Cartel Damage Claims Hydrogen Peroxide v. Evonik Degussa and Others on the jurisdiction of Member State courts under the Brussels I Regulation in the context of private damages actions for competition law infringements.
In 2006, the European Commission issued a decision finding that nine companies had participated in a cartel relating to hydrogen peroxide and perborate. In 2009, Cartel Damage Claims (CDC), a Belgian litigation funding company, filed a claim for damages before the Regional Court of Dortmund, Germany, against six of the addressees of the Commission's decision, including Evonik Degussa GmbH. Only Evonik Degussa was based in Germany, but in September 2009, CDC and Evonik Degussa settled, leaving the action to continue before the German court without a German defendant.
Several defendants objected that the Regional Court of Dortmund did not have jurisdiction over the dispute. In this respect they claimed that it was not the proper forum under Regulation 44/2001 on jurisdiction and the recognition and enforcement of judgments in civil and commercial matters (the "Brussels I Regulation"), or at minimum that it did not have jurisdiction after the withdrawal of the German "anchor" defendant. The defendants also contended that the court's jurisdiction was precluded by an arbitration clause. The Regional Court of Dortmund therefore referred the preliminary question of its jurisdiction to the Court of Justice of the European Union ("ECJ").
Advocate General Jääskinen first examined whether the German court could have jurisdiction over the non-German defendants under Article 5(3) of the Brussels I Regulation, which provides that in matters relating to tort, delict, or quasi-delict, a defendant may be sued in the Member State where the harmful event occurred. The Advocate General considered that, if applying Article 5(3) to competition law damages actions was not to be excluded in principle, it was nonetheless inappropriate for a case involving a horizontal infringement over a long duration with a complex structure, which as a result involved participants and victims dispersed across the EU. In such a case, contrary to the very purposes of the Article, applying Article 5(3) would result in jurisdiction being proper in a multitude of courts, rather than in the identification of the court having the closest link to the action or best placed to assess liability. The Advocate General therefore took the view that Article 5(3) would not be an appropriate basis for jurisdiction in this case.
Advocate General Jääskinen next addressed the application of Article 6(1) of the Brussels I Regulation, which effectively allows the use of an "anchor" defendant to tie multiple defendants to a single action in one jurisdiction if "the claims are so closely connected that it is expedient to hear and determine them together to avoid the risk of irreconcilable judgments resulting from separate proceedings". Case law has established that "irreconcilable judgments" in this sense refers to divergences in the context of the same situation of fact and law. The Advocate General considered the defendants to be in such a situation despite differences in when and where they participated in the cartel, because they were nonetheless parties to a single and continuous infringement. In this context, the possibility that defendants could face joint and several liability in some Member States but not in others could in principle present a risk of irreconcilable judgments, though it was for the national courts to assess the existence of this risk.
The Advocate General further addressed whether the withdrawal of the claim against the "anchor" defendant affected the national court's continuing jurisdiction over the matter. Here, the Advocate General considered that, once the court has properly acquired jurisdiction, it is not relevant whether claims against a given defendant are withdrawn. However, an exception would arise where the use of the "anchor" defendant under Article 6(1) had been abusive. Such abuse would occur, for example, where the settlement with that defendant had already been effectively agreed before the claimant brought the action, but the claimant and defendant had concealed this in order to establish jurisdiction over the remaining defendants in the settling defendant's domicile.
Finally, the Advocate General addressed whether account could be taken of an arbitration or jurisdiction clause in the relevant supply contracts. The Advocate General considered that such a clause is not per se inapplicable in the context of an action arising from a competition law infringement, but that it would however deprive the prohibitions of Article 101 TFEU of useful effect if the claimant were unaware of the infringement at the time they adhered to the arbitration or jurisdiction clause. The Advocate General expressed doubt that, in the case of a secret cartel, the claimants would have had sufficient knowledge of the infringing agreements and of their illegality to give valid consent to an arbitration or jurisdictional clause covering claims arising from those illegal agreements.
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.
