Strand, London, WC2A 2LL
B e f o r e :
| NATIONAL GRID ELECTRICITY TRANSMISSION PLC
|- and -
|(1) ABB LTD
(2) ABB POWER T&D LIMITED
(3) ABB LIMITED
(4) ABB HOLDINGS LIMITED
(5) ABB ASEA BROWN BOVERI LTD
(7) ALSTOM LIMITED
(8) ALSTOM UK HOLDINGS LIMITED
(9) ALSTOM HOLDINGS
(10) AREVA SA
(11) ALSTOM GRID (UK) LIMITED (formerly known as Areva T&D UK Limited)
(12) T&D HOLDING
(formerly known as Areva T&D Holding SA)
(13) SIEMENS AG
(14) SIEMENS TRANSMISSION & DISTRIBUTION LIMITED
(15) VA TECH REYROLLE DISTRIBUTION LIMITED
(16) SIEMENS PLC
(17) VA TECH (UK) LIMITED
(18) SIEMENS HOLDINGS PLC
(19) VA TECH
SCHNEIDER HIGH VOLTAGE GMBH
(20) VA TECH TRANSMISSION & DISTRIBUTION GMBH & CO KEG
(21) SIEMENS AKTIENGESELLSCHAFT ÖSTERREICH
(22) ALSTOM GRID SAS
(formerly known as Areva T&D SA)
(23) ALSTOM GRID AG
(formerly known as Areva T&D AG)
for the Claimant
Mr M Hoskins QC (instructed by Freshfields Bruckhaus Deringer LLP)
for the 1st to 5th Defendants
Mr S Morris QC (instructed by Hogan Lovells International LLP)
for the 6th to 9th, 11th to 12th and 22nd to 23rd Defendants
Ms M Demetriou QC (instructed by Clifford Chance LLP) for the 13th – 21st Defendants
Ms K Bacon (instructed by Shearman & Sterling (London) LLP) for the 10th Defendant
Mr Nicholas Khan (Legal Service of the European Commission) for the European Commission by way of written intervention
Hearing dates: 8-9 November 2011
Crown Copyright ©
Mr Justice Roth :
"… 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. Unless the preparation of the follow on action continues then the parties will not be on an equal footing because NGET will not know what are the relevant issues or what documents relevant to those issues, particularly causation, are available."
"The Commission's general duty of loyal co-operation pursuant to Article 4(3) of the Treaty on European Union requires that it transmits information in its possession to requesting national courts, except: (i) when this would jeopardise the protection of information covered by the obligation of professional secrecy or (ii) in case of overriding reasons relating to the need to safeguard the interests of the Union or to avoid any interference with its functioning and independence, in particular by jeopardising the accomplishment of the tasks entrusted to the Commission.
"… I consider that, in the very particular circumstances of this case, the disclosure of the requested documents would not unduly interfere with the functioning of the Union. In this respect, the Commission firstly notes that, having regard to point 26 of the Notice on Cooperation with National Courts, you have excluded leniency documents (as defined in paragraph 10 of your judgment of 4 July 2011 in this case) from the scope of your Article 15(1) request (see paragraph 12 of your judgment). I also consider the following elements to be particularly relevant: (i) your request comes at a time that the Commission has already adopted its decision in the GIS case and (ii) other parties asserted impediments to disclosure under French law (Alstom and Areva), thereby rendering a disclosure order under English rules of civil procedure more difficult, if not impossible."
The adjourned disclosure application
i) the confidential version of the Decision;
ii) the responses (including any accompanying documents) to the Commission's Statement of Objections by investigated companies in the ABB defendant group;
iii) the responses by the investigated companies in the ABB defendant group to requests for information made by the Commission that explain the meaning of pre-existing documents relating to the operation and/or effects of the cartel, or otherwise provide information on the operation and/or effects of the cartel;
iv) save insofar as disclosed pursuant to the order of 4 July 2011, the responses by investigated companies in the Alstom and Areva defendant groups to requests for information made by the Commission that explain the meaning of pre-existing documents relating to the operation and/or effects of the cartel, or otherwise provide information on the operation and/or effects of the cartel.
"(1) Whether the ruling in Pfleiderer applies, directly or by analogy, to disclosure of leniency materials in the context of a decision by the Commission;
(2) Whether the national court has jurisdiction to determine an application for disclosure of documents containing leniency materials submitted to the Commission or whether such a request has to be made to the Commission pursuant to Article 15(1) of Regulation 1/2003;
(3) If the national court has jurisdiction to order disclosure of such materials, what are the factors which militate in favour of or against an order being made that are to be weighed in accordance with paragraphs 30-31 of the ruling in Pfleiderer."
"Are the provisions of Community competition law – in particular Articles 11 and 12 of Regulation No 1/2003 and the second paragraph of Article 10 EC, in conjunction with Article 3(1)(g) EC – to be interpreted as meaning that parties adversely affected by a cartel may not, for the purpose of bringing civil-law claims, be given access to leniency applications or to information and documents voluntarily submitted in that connection by applicants for leniency which the national competition authority of a Member State has received, pursuant to a national leniency programme, within the framework of proceedings for the imposition of fines which are (also) intended to enforce Article [101 TFEU]?"
"25 …, as maintained by the Commission and the Member States which have submitted observations, leniency programmes are useful tools if efforts to uncover and bring to an end infringements of competition rules are to be effective and serve, therefore, the objective of effective application of Articles 101 TFEU and 102 TFEU.
26 The effectiveness of those programmes could, however, be compromised if documents relating to a leniency procedure were disclosed to persons wishing to bring an action for damages, even if the national competition authorities were to grant to the applicant for leniency exemption, in whole or in part, from the fine which they could have imposed.
27 The view can reasonably be taken that a person involved in an infringement of competition law, faced with the possibility of such disclosure, would be deterred from taking the opportunity offered by such leniency programmes, particularly when, pursuant to Articles 11 and 12 of Regulation No 1/2003, the Commission and the national competition authorities might exchange information which that person has voluntarily provided.
28 Nevertheless, it is settled case-law that any individual has the right to claim damages for loss caused to him by conduct which is liable to restrict or distort competition (see Case C-453/99 Courage and Crehan  ECR I-6297, paragraphs 24 and 26, and Joined Cases C-295/04 to C-298/04 Manfredi and Others  ECR I-6619, paragraphs 59 and 61).
29 The existence of such a right strengthens the working of the Community competition rules and discourages agreements or practices, frequently covert, which are liable to restrict or distort competition. From that point of view, actions for damages before national courts can make a significant contribution to the maintenance of effective competition in the European Union (Courage and Crehan, paragraph 27).
30 Accordingly, in the consideration of an application for access to documents relating to a leniency programme submitted by a person who is seeking to obtain damages from another person who has taken advantage of such a leniency programme, it is necessary to ensure that the applicable national rules are not less favourable than those governing similar domestic claims and that they do not operate in such a way as to make it practically impossible or excessively difficult to obtain such compensation (see, to that effect, Courage and Crehan, paragraph 29) and to weigh the respective interests in favour of disclosure of the information and in favour of the protection of that information provided voluntarily by the applicant for leniency.
31 That weighing exercise can be conducted by the national courts and tribunals only on a case-by-case basis, according to national law, and taking into account all the relevant factors in the case.
32 In the light of the foregoing, the answer to the question referred is that the provisions of European Union law on cartels, and in particular Regulation No 1/2003, must be interpreted as not precluding a person who has been adversely affected by an infringement of European Union competition law and is seeking to obtain damages from being granted access to documents relating to a leniency procedure involving the perpetrator of that infringement. It is, however, for the courts and tribunals of the Member States, on the basis of their national law, to determine the conditions under which such access must be permitted or refused by weighing the interests protected by European Union law."
Does Pfleiderer apply to the Commission leniency programme?
Does the Commission have exclusive jurisdiction to determine the disclosure of leniency materials submitted under its leniency programme?
"In proceedings for the application of Article  or Article  of the Treaty, courts of the Member States may ask the Commission to transmit to them information in its possession …"
Application of Pfleiderer in the present case
"Even where claimants are in a position to describe and prove the actual elements necessary for finding an infringement, having to demonstrate in detail the causation and quantification of their damages remains a particular difficulty in competition cases. To establish their damage, claimants have to compare the anti-competitive situation to a situation which would have existed in the absence of the infringement, i.e. a hypothetical competitive market. In a breach of contract case, a claimant can normally use market prices at the time of the breach of contract as the benchmark for calculating his loss. However, in a typical competition case, the claimant cannot rely on the prices at the time of the infringement and has to establish what the price would have been in the absence of the restriction of competition. For this purpose, he will often depend on information that is in the sphere of the defendant and possibly their partners in the infringement: for example, notes on the price overcharges agreed secretly between cartel members, details on how and when they influenced price and other parameters of competition, or internal documents of the infringer showing his analysis of market conditions and developments. Also the reconstruction of a hypothetical competitive market to quantify the damage caused by the infringer usually presupposes knowledge of facts on the commercial activities of the infringer and other players on the relevant market. The same or similar types of difficulty arise in the context of causation, e.g. when claimants try to identify the precise elements of anti-competitive behaviour by an infringer that have caused the claimants damage, or the extent to which several infringers had individually contributed to the damage caused."
(a) Other sources of information
"At both the worldwide level and the European level, the participants took elaborate precautions in order to disguise or conceal their contacts and meetings. These concealment measures existed since the start of the cartel and multiplied from 2002 onwards. The participants continued to use these measures until the end of the cartel."
"(114) … Japan on one side and the European domestic markets of the European members of the cartel on the other side (where some of them had their stronghold) were respectively allocated as a block (100%) to the Japanese group or to the European group. Those territories were known as 'home markets' or 'home countries'. Thus, Japanese projects did not need to be discussed with the European members and European projects originating in 'home countries' did not need to be discussed with the Japanese counterparts. Consequently, none of those projects had to be accounted for.
(115) Also amongst the European members of the cartel there was the understanding that projects in 'home countries' within Europe (see recitals (133) to (138) below) were to be left to 'home producers'. Sometimes there were several 'home producers' for a single 'home country'. The other European cartel members were not supposed to intervene in the arrangement amongst 'home producers'. Therefore, European projects originating in 'home countries' did not need to be discussed with the other European producers and they did not have to be accounted for.
(125) The worldwide sharing of projects relied on the 'common understanding' that (a) the Japanese should not quote for projects in Europe and vice-versa, and (b) Japan and the European countries where the European cartel members had their stronghold were reserved to the cartel members concerned, without interference by the others….
(133) The cartel applied a 'home-producer' principle, that is to say, certain national markets were reserved for one, sometimes several, companies with a traditional stronghold in these markets. These were the 'home countries' or 'home markets'. They were not discussed amongst the rest of cartel members and the volumes sold in these countries were left outside the quota calculation both at worldwide and at European level, unlike the volumes sold in the other markets."
"The judge has a discretion whether or not to inspect the documents. But if the party seeking discovery shows that the production of the documents may be necessary for the fair disposal of the action an order should normally only be refused after the court has examined the documents and considered them in the light of the material already in the applicant's possession. Indeed, as is apparent from the speech of Lord Wilberforce in the Nassé case  AC 1028 the court will need to inspect the documents where relevance is admitted but it is asserted that the documents are confidential. Similarly, inspection is likely to be the only safe course where it seems probable that the documents contain a version of events given soon after their occurrence and at a time when the recollection of the witness would have been fresh."
The Request for Further Information
"(a) please identify who were the main individuals acting on behalf of your company in relation to the agreement and/or implementation of the cartel between 15 April 1988 and 2 March 2004 (the "relevant periods");
(b) save insofar as covered by (a) above, please identify who were the main individuals acting on behalf of your company in relation to the Agreement and/or implementation of the cartel in the relevant period in the UK;
(c) please set out the roles that were played in the cartel by each individual referred to in (a) and (b) above, in relation to each period of time during which they took part."
(a) identify which of the individuals referred to in paragraph 1 above are still within your employment;
(b) state whether, during the relevant period, any of these individuals still within your employment who took part in the cartel in the UK gave, or were given, an estimate of the amount by which the prices of GIS or GIS projects, or particular descriptions of GIS or GIS projects (such as a 400 kV equivalent bay), were, would be, or may be, raised, or of the extent to which your company or any participant in the cartel would or may benefit, as a result of any of the activities of the cartel (i) generally; or (ii) in the UK; or (iii) in relation to any of the projects listed in Appendix 2 to the Particulars of Claim.
(c) if the answer to (b) above is Yes, please provide details of the estimate."
"Please state, insofar as this is within the knowledge of the individuals still within your employment who took part in the cartel in the UK, how the "home country" cartel arrangement in the UK was operated in the relevant period, by explaining and setting out:
(a) what was the "UK forum", what were its rules, how it was operated, and which representatives of your company or of other participants in the cartel were involved in it at any material time;
(b) to which particular cartel members the supply to UK customers were reserved, and for which period and in what shares or proportions or amounts;
(c) how these shares or proportions or amounts were calculated, based on different elements of GIS;
(d) how the cartel arrangement in the UK was implemented to ensure that each relevant cartel member supplied no more than the shares or proportions or amounts allowed;
(e) in particular (without prejudice to the foregoing), having regard to document SD009823 [CONFIDENTIAL] and to the methodology referred to briefly in recital 165 of the Decision, what pricing or weighting formulae were used (and explain precisely how were they used) in order to value different elements of GIS such as 400kV bays or 132kV bays, and to value GIS projects as a whole;
(f) how the cartel arrangement in the UK was monitored to ensure that each relevant cartel member supplied no more than the shares or proportions or amounts concerned, and what "compensation" arrangements were applied under the cartel rules."
"The court may at any time order a party to –
(a) clarify any matter which is in dispute in the proceedings; or
(b) give additional information in relation to any such matter,
whether or not the matter is contained or referred to in a statement of case."
"A Request should be concise and strictly confined to matters which are reasonably necessary and proportionate to enable the first party to prepare his own case or understand the case he has to meet."
"The guiding principle in this field must be that laid down in R.S.C. Ord. 26, r.1(1), that interrogatories must be necessary either for disposing fairly of the cause or matter or for saving costs. Necessity is a stringent test. It cannot be necessary to interrogate to obtain information or admissions which are or are likely to be contained in pleadings, medical reports, discoverable documents or witness statements unless, exceptionally, a clear litigious purpose will be served by obtaining such information or admissions on affidavit. As a general statement we would agree with the statement in the Guide to Commercial Court Practice, paragraph 11.6 (Supreme Court Practice 1995, volume 1, para. 72/A14) endorsed by Coleman J. that
"Suitable times to interrogate (if at all) will probably be after discovery and after exchange of witness statements."
Interrogatories should not be regarded as a source of ammunition to be routinely discharged as part of an interlocutory bombardment preceding the main battle. The interrogator must be able to show that his interrogatories, if answered when served, will serve a clear litigious purpose by saving costs or promoting the fair and efficient conduct of the action."
By ABB and Siemens
(1) From the confidential version of the Decision, the following recital paragraphs:
15, 22, 27, 34, 40, 44, 48, 56, 60, 63, 68, 76,
119 - footnote 65: first two sentences (ending "on a national basis")
127 - first sentence
134 - footnote 92
135 (excluding footnotes)
136 (excluding footnotes)
137 (including footnote)
138 (excluding footnotes)
165 - Table V
192 to 196 (excluding footnotes)
202 (excluding footnote)
205, 207 (excluding footnote), 208, 209, 213 (excluding footnote)
(2) From Arriva's response to the Commission's request for information dated 5 November 2004:
The answer to question 17 (pages 29-30)
(3) From the response to the Commission's request for information dated 4 October 2004:
Part 2: answers to questions (5) to (8)
Part 3: answers to questions (9) - (11)
(4) The updated "List of Abbreviations" provided in response to the Commission's information request dated 18 October 2005 and labelled Exhibit 37