The UK Supreme Court ('UKSC') has rejected an application to hear an appeal which may have clarified the way in which competition infringement decisions can be relied upon in private 'follow-on' damages claims. The application centred on the extent to which courts are bound by the findings of an antitrust decision.
The administrators of Enron brought an action for damages against English, Welsh & Scottish Railways ('EWS'), following a 2006 ruling by the Office of Rail Regulation ('ORR') that EWS had abused its position on the coal-haulage market. The action was struck out by the CAT on the basis that the conduct in question had not caused actual loss or damage to Enron. Enron disputed this arguing that the ORR's statement in the original decision that Enron had suffered 'competitive disadvantage' was binding on the CAT.
Last November, the Court of Appeal dismissed Enron's appeal, finding that the CAT was entitled to conclude that Enron had not made out its case. The Court of Appeal held that the findings of fact in the infringement decision were binding on the reviewing tribunal, however, it was "not good enough for a party claiming damages in a follow-on claim to root around in the decision of the regulator to find stray phrases" and assert them as findings of fact. In this case, being placed at a competitive disadvantage did not equate to a finding that loss had been suffered and thus the CATs refusal to award damages had not amounted to a departure from the ORR decision. Enron's administrator then applied to appeal this decision to the Supreme Court.
The OFT also took the unusual step of writing to the UKSC to express the view that clarification was required on the extent to which courts must adhere to findings of fact in antitrust decisions. The OFT stated that the Court of Appeal judgement could lead to "uncertainty and confusion for potential claimants in follow-on actions". It was eager to stress however that it took this step "from a policy perspective" and wanted to steer clear of the merits of the case.
However, the UKSC rejected these views and refused to hear the application seemingly on the basis that the case did not raise an arguable point of law of general public importance. It remains to be seen whether future cases may require the Supreme Court to revisit this issue.
To view Community Week, Issue 528; 8th July 2011 in full, Click here.
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.
