England and Wales High Court (Patents Court) Decisions

IN THE HIGH COURT OF JUSTICE
CHANCERY DIVISION
PATENTS COURT

		Royal Courts of Justice Strand, London, WC2A 2LL
		31 May 2002

Mr Justice Laddie:

INTRODUCTION

1. This is the judgment in an application by the claimant, Getmapping Plc ("GM"), for interlocutory relief against the defendant, Ordnance Survey ("OS"). It concerns the issue of whether, or the extent to which, OS is obliged, by virtue of the provision of the Competition Act 1998, to place GM's detailed digital photographs of the United Kingdom on OS's website or to make them accessible from that site. Extensive evidence has been filed. Based on that and the very helpful skeletons produced by Mr Brealey QC, acting for GM, and Mr Barnes QC and Mr Jowell, acting for OS, I set out below the relevant factual background.

FACTUAL BACKGROUND

2. GM is a company listed on the Alternative Investment Market. Its managing director is Mr Tristram Charles Lunel Cary who has provided three witness statements in this application. GM, previously known as the Millennium Mapping Company, was launched in early 1999 with an initial capital of £1m. The company was formed for the purpose of producing a digital colour image of the whole of the United Kingdom, the first version to coincide with the Millennium. It plans to repeat the process of overflying the country and updating its digital colour image of the United Kingdom, known as the "Millennium Map", on at least a five year rolling basis. In April 2000, GM was floated on the Alternative Investment Market ("AIM") with a total capital exceeding £12.5m. GM has already overflown and has made a digital colour image of the whole of England and Wales, most of which was achieved by the end of 2000. It has also photographed over 40% of Scotland and Northern Ireland.
3. There are few in this country who do not know of OS. It is a government department responsible for the official, definitive surveying and topographic mapping of Great Britain. It is run as a separate entity pursuant to the Government Trading Funds Act 1973. It was formed in 1791. It was established as an Executive Agency on 1 May 1990 and started to operate as a Trading Fund from 1 April 1999. It is under the ministerial responsibility of the Secretary of State for Transport, Local Government and the Regions. It aims to satisfy the national interest and customer need for accurate and readily available geospatial data and maps of the whole of Great Britain in the most effective and efficient way.
4. When first established, its mission was to provide accurate maps in order to help England defend itself in case of invasion. After the First World War, funding was cut and the organisation's maps fell into disrepair. The modern day foundations for the OS were established during the 1930's when Sir John Davidson conducted a review of the organisation. This review led to the formation of the National Grid, a unique national referencing system for geospatial information relating to Great Britain. As Mr Keith Murray, Head of Geographic Information Strategy at OS, explains in his first witness statement, in technical terms, the National Grid is a metric grid based on the Transverse Mercator Projection developed by OS in 1936 for use in Great Britain. The establishment of the new mapping based on the National Grid involved a combination of revising the old rural maps and re-surveying urban and mountain and moorland areas and creating new mapping based on a single national system. Some of the old maps, particularly those in rural areas, are not as accurate as are now achievable with modern technology. As a result of this, the nominal accuracy of the mapping provided by the National Grid varies from 40 cm in urban areas to 2 metres or more in some rural areas and 3 metres in mountain and moorland areas. Publication of new mapping based on the National Grid for the whole of Great Britain was completed in 1980.
5. As Mr Murray also explains, in the mid 70's work began on digital mapping. In simple terms, this process involved converting the data stored on paper maps into a computer-compatible format which can then be displayed at will. The purpose behind digital mapping was to facilitate the updating of all OS maps. OS has a large number of field surveyors out in the countryside conducting surveys to ensure that all geographic information is kept as up-to-date as possible. The advantage of digital mapping is that these updates can be fed straight into a digital map, rather than OS having to republish its paper cartographic maps every year or so. The programme was completed in April 1995. At that time OS had built up a database of some 230,000 map "tiles" of geographic data. I am told that OS was the first national mapping agency in the world to have achieved the electronic mapping of the entire national land mass at this level of detail. The database subsequently became known as the National Topographic Database ("NTD").
6. The NTD is used extensively by major Government Agencies, local authorities, utility companies and private sector companies, for example those involved in civil engineering. However it is still based on the National Grid and incorporates the inaccuracies inherited mainly from pre-1938 maps. The result is that OS resolved to engage in a programme, called the Positional Accuracy Improvement Programme ("PAIP"), designed to reduce the inaccuracy in the existing map database. PAIP has been somewhat delayed. Inaccuracies, particularly in rural areas, continue to exist in OS maps and the NTD. For many years OS has produced a standard reference map of Britain called the Ordnance Survey Landline map ("Landline"). It incorporates the inaccuracies referred to above although, over time, it is the intention to remove all of these so that it becomes completely accurate.
7. OS came to the conclusion that a more comprehensive database than that provided by the NTD was needed. The latter contained digital mapping, but it was realised that it would be worthwhile to incorporate other relevant geographic information into a database. For example it would be useful to incorporate data identifying the nature or purpose of individual objects as well as their geographical location. This could then be connected to other types of information, such as economic, social or environmental data. These concepts gave rise to the decision to create the Digital National Framework ("DNF"). This would provide a national framework for geographical data.
8. As Mr Murray explains, the DNF provides the technology underpinning OSMasterMap. OS MasterMap consists, or will consist, of several layers and themes. Customers will be able to choose which layers, or themes, they wish to purchase. OS MasterMap is the collective brand name for the product and services based on the DNF technology. The topographic layer within OS MasterMap was launched on 30 November 2001. More layers are planned to be released later this year. Customers are free to associate their own layers of information with the layers of geographical data contained within OS MasterMap.
9. Among the layers of information included or to be included within OS MasterMap is an imagery layer containing digital colour images of Great Britain. Indeed, for about the last 18 months, OS has incorporated an imagery layer into public presentation slides to demonstrate OS MasterMap to its customers. OS MasterMap will be available to customers from a website operated by OS. When it is up and running, a customer will be able, say, to look up a map on the website and then pull up the equivalent digital colour image. The digital image will show features not to be seen on the map - for example trees. Likewise there will be data visible on the maps which will not be visible on the digital images - for example features which are obscured from view by trees.

ORTHORECTIFIED AND GEOCORRECTED IMAGES.

10. It is the acquisition of digital images of Great Britain by OS which is at the heart of the dispute between the parties to this application. However, before turning to that, I should say something about how the digital images are taken and how they can be manipulated digitally.
11. Images of the country can be acquired from cameras located at a sufficient height above the ground. Thus it is possible to obtain images from cameras aboard satellites. For present purposes however what is in issue are photographs taken from low flying aircraft. For example GM uses a number of aircraft with sophisticated camera equipment on board to photograph the ground while flying to and fro in a regular pattern. The objective is to build up a detailed and complete image of the land. As I have mentioned already, GM has photographed the whole of England. It claims to be the first to have achieved that, although there are a number of competitors who have photographed parts of the country.
12. However, taking photographs of the land is not quite as simple as it sounds. Even if one makes sure that the photographs are only taken in perfect visibility, they are not a perfect record and can be misleading. For example, the lenses in the camera may distort the image. A rectangular field may appear to have curved edges in the photograph. Furthermore, as the plane flies, it will pitch, roll and yaw. Even if it does not, not all parts of the image of the ground below the plane will be photographed from directly above, some will be photographed at an angle. This causes optical distortions, particularly if some parts of the ground are elevated in relation to others. This can be explained by reference to a simple example. Imagine that one is looking out of a third floor window across a street. On the other side of the street there is a motorcycle parked on the road but immediately adjacent the kerb. Because we have two eyes and also have to focus on an image, our brains inform us that the seat of the motorcycle is located immediately over the rest of the vehicle and immediately over the edge of the road. However, if a photograph of the motorcycle is taken, the visual image created is two dimensional, rather like an Egyptian hieroglyph. The seat will appear to be located somewhere on the pavement behind the vehicle. It is only data concerning the angle of the camera, elevation and the like which would enable the photograph to be interpreted properly so as to indicate the proper ground projection of the seat.
13. There are two major methods for correcting or reducing these distortions in the photographs. One is called orthorectification, the other geocorrection. Orthorectification is described as follows in Mr Murray's first witness statement. I do not understand it to be challenged:

"Orthorectification involves the use of height data in the rectification process. Every single pixel in the image is associated with a co-ordinate on the map and a Digital Terrain Model ("DTM") or Digital Elevation Model ("DEM") is used to ensure that the image takes account of terrain features. Further, orthorectification involves a rigorous mathematical modelling of the camera position/direction and the terrain surface at the moment of image exposure. A software process is then able to move each of the pixels in the image individually into its correct National Grid position. The process virtually eliminates the distortions inherent in aerial photography. … An orthophotograph combines the characteristics of a photograph with the qualities of a map. This will provide a best match to its absolute position and to other OS data, save where that data is itself inaccurate."

14. Thus each spot on the digitised photograph is moved to its proper location. The result is that all the distortions in the photograph are removed and an image is created which accurately reflects what would be have been seen if a photograph been taken from vertically above each part of the terrain.
15. Mr Murray describes geocorrection or georectification as follows:–

"Georectification involves taking grid co-ordinates from the map and plotting these onto the same points on the aerial image. The image is then manipulated through a rubber-sheeting or "stretching" process so that the photograph aligns to the grid points on the map. Georectified images are correct at the points where the image links up to the map co-ordinate. Elsewhere on the image however the data is likely to be inaccurate. Additionally, georectification does not take any account of height data. As no account is taken of the displacements of the image due to the height of features above a level surface in the aerial image, there are residual distortions where height data has not been incorporated. The imagery itself will look fine, but it is only when mapping data is put on top of it that discrepancies will appear."

16. Thus the photograph is stretched and compressed so that selected individual features on it match up with their equivalent on an existing map. For example, assume that there are two cross roads close to each other, the photograph can be digitally compressed or stretched so that they match up with their location on the paper map. The compressing or stretching will also affect points on the photograph between the selected locations. Once geocorrected, the photograph will fit more or less accurately over the map. This is inevitable because the correction process is designed to make it fit to the map. One consequence of this is that, significant errors in the map will be inherited by and incorporated into the geocorrected image. Thus a geocorrected image will almost always fit an inaccurate map more closely than an orthorectified one would.

THE RELATIONSHIP BETWEEN GM AND OS

17. I have already referred to GM's and OS's main activities. To produce and sell its own products, including the Millenium Map, GM needed to use, and in some respects reproduce features from, OS maps. In December 1999 it entered into a licence to allow it to use OS's copyright material for these purposes. On 8 September 2000, GM entered into a standard OS "Representative Agreement". As Mr Murray says, this put in place a relatively straightforward arrangement whereby OS would provide quotations for GM's products to its customers and pass on any orders to GM in return for a commission. Discussions between OS and GM took place with a view to GM supplying imagery for use in DNF. However by the end of December 2000 a decision had been taken within OS to develop its own imagery, at least initially in collaboration with others.
18. At a meeting between OS and GM on 10 January 2001, OS's plans were considered. GM asserted that the idea of incorporating an imagery layer within DNF was "theirs" and that an open tender process was not necessary for that reason. On the other hand OS pointed out that it was under pressure to embark on an open tender and that there was little chance of an exclusive arrangement with GM. OS also favoured a "onestop shop" with imagery incorporated into the DNF. In other words it wanted to set up DNF in a way in which a customer could obtain all its requirements, including map and imagery, from the same site. It appears that this was the first time that OS informed GM of this one-stop option and it is that which is one of the matters complained of now by GM as constituting an abuse of OS' dominant position contrary to s 18 of the Act. Mr Cary says that this development came as a complete surprise to him at that time.
19. On 8 May 2001, OS issued a press release which stated that it intended to market is own colour digital imagery covering the whole of Britain. It indicated that it would be sending its planes up to commence taking photographs later that year. The press release makes it clear that the intention is to work with other suppliers of imagery until OS' own imagery was available. Once again it is made clear that a one-stop shop was to be set up. GM says that OS's decision, communication in this May 2001 letter, to make and sell its own imagery constituted a breach of an implied term not to compete in the Representative Agreement, an "inevitable" breach of confidence owed to it and a further abuse of a dominant position by OS. As Mr Cary puts it in his first witness statement, in June of that year by letter GM "recorded its objection in principle to [OS] procuring its own digital colour imagery".
20. Notwithstanding this objection, at the beginning of August of last year, OS sent to a shortlist of suitable candidates, including GM, an Invitation to Tender ("ITT") for the supply of digital colour images of the United Kingdom to OS for inclusion in the DNF. The ITT made it clear that OS had decided to use orthorectified images. It provided that the preference was to receive such images although, in some circumstances it might be prepared to accept film negatives and raw scans. There was no provision for the acceptance of geocorrected images. This is of particular concern to GM because many of its images are geocorrected. Mr Cary's views on this are set out in the following passages from his first witness statement:

"[T]he Defendant is insisting on imagery that is "ortho-rectified". Orthorectification is a separate, and significantly more expensive, process than geocorrection and is aimed at correcting all distortions to the photographic image caused by the undulations of the terrain. An effect of the ortho-rectification process specified by the Defendant is that, while geographically accurate to the lie of the land, it does not fit exactly the Defendant's Landline map which, through historical surveying error is not fully geographically accurate and can sometimes be tens of metres out. This is because of errors in the Landline data itself . Ortho-rectification also costs about twice as much as geo-correction.

On 9th November 2001 the Defendant effectively excluded the Claimant's imagery from the procurement process . ... a letter from the defendant to the Claimant confirm[s] the reason for this, namely because "your base line proposal does not conform to the specification requested in that it is geocorrected imagery and not orthorectified as required". In short, the Defendant made it plain to the Claimant that it would be competing head on with the Claimant in the market for orthoimagery."

21. In any event, GM participated in the tender exercise. The geocorrected images were excluded but it appears that it is likely to be offered a contract to supply its orthorectified images and raw photography of about 40% of Britain. The rest will come from other sources.
22. The tender process came to an end early this year. Following that, GM commenced the current proceedings in March. The nature of its claims has changed with time.

THE CLAIMS MADE BY GM IN THIS ACTION

23. GM's claims fall under a number of heads. First it says that for OS to set up the one-stop shop and supply its own imagery would constitute a breach of confidence and a breach of the implied term not to compete. Second it says, and for the purpose of these proceedings OS admits, that OS has a dominant position in the supply of maps in the United Kingdom. GM says that that setting up the one-stop shop is an abuse of that dominant position. Furthermore it says that entering into competition with GM by carrying out its own colour photography and supplying that for use in the DNF is an abuse of a dominant position. Finally it says that the choice of orthorectification is an abuse of a dominant position in that it is designed to exclude GM from the DNF. Based on these allegations, GM has asked for relief which would exclude OS from competing in the supply of colour digital photography and would require it to accept geocorrected images for incorporation in the DNF. Although the relief sought on the Claims Form continues to be as extensive as this and the interlocutory relief originally sought on this application was similar in scope, the relief now sought is somewhat more restricted. In essence, what is sought is an order which would oblige OS to place GM's geocorrected images in the DNF website so that users who access that site can see and obtain GM's images. Alternatively, and as a fall back position, it seeks an order which would require OS to incorporate high profile links on its DNF site to GM's website so that customers who visit the former can find their way easily to the latter. In relation to this, it should be understood that links between the OS website and GM's website already exist. However GM believes these are not prominent enough and it wants new links at the "front" of the OS site. It does not require the removal of the orthorectified images nor does it seek now to exclude OS from supplying some of the latter. An additional order restricting what OS could say about the benefits of orthorectification was also sought but I understood Mr Brealey not to pursue this.
24. Before turning to the issues which remain live on this application, I would just say something about two of the causes of action advanced in the Particulars of Claim. First is the allegation of breach of confidence. Mr Brealey told me that he did not rely on this for the purpose of the application and that was the basis upon which Mr Barnes prepared for this application. Consistent with this, I was told that it was not necessary to pre-read a small number of witness statements which related exclusively to that issue. In fact I did read them. Towards the end of his opening submissions, Mr Brealey said that, although his client did not rely on breach of confidence as such in its application for interlocutory relief, nevertheless the fact that there had been a "gross" breach was a factor which could be taken into account in determining whether or not to exercise my discretion in favour of the grant of an injunction. In view of the fact that this issue had been expressly dropped before the hearing started, I do not think it would be appropriate to take this issue into account, at least without offering Mr Barnes an opportunity to prepare for it. In any event, the point is hopeless. The pleadings are devoid of all particularity both as to the nature of the confidential material and the acts of breach complained of. There is no evidence on this application to show that there has been any breach of confidence. It is a point without merit.
25. Second, Mr Brealey does not rely on this application on the alleged implied term according to which OS was bound by contract not to compete in the supply of digital photographs. It is sufficient to say that, having read the pleadings, the Representative Agreement and the evidence, I think GM will have very considerable difficulties succeeding on this argument at the trial.

THE APPROACH TO THE GRANT OF INTERLOCUTORY RELIEF

26. On this application GM is asking for an interlocutory mandatory injunction. Mr Barnes points out that, because OS is a government department, no injunction should be granted (see Crown Proceedings Act 1947 s.21(1)(a)). On the other hand he accepts that an equivalent order could be made in the form of an interim declaration (see CPR 25.1(1)(b)). The parties agree that the approach to be adopted is that approved of by the Court of Appeal in Zockoll Group v Mercury Communications [1998] FSR 354, namely that put forward by Chadwick J (as then) in Nottingham Building Society v Eurodyamics Systems [1993] FSR 468 at 474:

"In my view the principles to be applied are these. First, this being an interlocutory matter, the overriding consideration is which course is likely to involve the least risk of injustice if it turns out to be "wrong" in the sense described by Hoffmann J in [Films Rover International and others v Cannon Film Cells Ltd [1986] 3 All ER 772].

Secondly, in considering whether to grant a mandatory injunction, the court must keep in mind that an order which requires a party to take some positive step at an interlocutory stage, may well carry a greater risk of injustice if it turns out to have been wrongly made than an order which merely prohibits action, thereby preserving the status quo.

Thirdly, it is legitimate, where a mandatory injunction is sought, to consider whether the court does feel a high degree of assurance that the plaintiff will be able to establish his right at a trial. That is because the greater the degree of assurance the plaintiff will ultimately establish his right, the less will be the risk of injustice if the injunction is granted.

But, finally, even where the court is unable to feel any high degree of assurance that the plaintiff will establish his right, there may still be circumstances in which it is appropriate to grant a mandatory injunction at an interlocutory stage. Those circumstances will exist where the risk of injustice if this injunction is refused sufficiently outweigh the risk of injustice if it is granted."

27. In passing, it should be noted that the justification for taking into account the degree of assurance that the claimant will establish his right at the trial as explained in this passage and approved by the Court of Appeal must surely apply just as much to prohibitory interlocutory injunctions (see Series Five Software v. Clarke [1996] FSR 273).
28. The issue of the strength of GM's case is of considerable importance on this application. GM now seeks a much more restricted injunction than that sought on the claim form or in the application as originally drafted. Mr Brealey argues that the order now sought could be implemented without too great a dislocation to OS but the benefit to his client would be significant. In those circumstances it would be fair to grant the relief sought even if there are serious doubts as to his client's cause of action. Mr Barnes challenges the assertion that implementation of the order sought would be a trivial matter and he argues that the alleged commercial damage currently faced by GM has been over stated in the evidence. But, even if Mr Brealey's assessment is accurate, a mandatory injunction is, in most cases, unlikely to be granted if it appears that the claimant's rights are very weak or worse. Put in simple terms, applications for interlocutory relief, whether mandatory or prohibitory, should not be seen as means by which a court can be persuaded to grant relief on the basis of a claim to rights which it is fairly confident would not be upheld at the trial. The more confident it is that the claimant will fail at the trial, the less likely it is that an interlocutory injunction will be appropriate.

THE ALLEGED ABUSE IN THIS CASE

29. GM's allegation of abuse is as follows. OS holds a dominant position in the UK map market and it is therefore under an obligation not to abuse that position. Neither of those propositions are disputed for the purpose of this application. GM says that OS will effectively destroy the competition in the imagery market by allowing OS's own imagery in the one stop shop which it is setting up. It is said that the vice lies in the fact that OS will be cross subsidising its own imagery from its maps business, using public funds to sell the imagery and using its privileged position in the mapping market to compete with GM in the imagery market. This submission was modified somewhat during the course of argument because OS will be taking competitors' images for the one stop shop. It is only at some time in the future - 2004 at the earliest - that OS might be selling only its own imagery. In any event, for present purposes, GM does not seek an order preventing OS taking and using its own imagery or using ortho-corrected imagery both from GM and other sources. The complaint is centered on OS' ability to use its dominance in mapping to set up the one stop shop. I can not summarise Mr Brealey's case more succinctly than he does in his skeleton argument:

"In the present case, Getmapping's submission is simple [paragraph 46 (a) of the Particulars of Claim]. OS is leveraging its market power and privileges in its mapping market to gain a competitive advantage in the imagery market. By displaying its imagery in the one stop shop OS is not competing on the merits. The whole of OS's infrastructure (from the NTD to the new digital Master Map) has been built with the aid of public funding. Further, so far as Getmapping can ascertain, OS imagery is merely taking a free ride on the association and the links with OS's mapping data. The competitive advantage given to OS's imagery is likely to have a drastic effect on competition in the imagery market. Consequently, if OS's imagery is in the one stop shop it is essential for Getmapping to be there as well."

30. This argument, and particularly the last sentence in the latter passage, presents a problem. If, as GM asserts, OS has abused its dominant position to set up the one stop shop, then the remedy is to close it down. Allowing GM in on terms which, presumably, will be set by OS does not cure the alleged abuse although it may make it less painful to GM.
31. Ignoring this point for the moment, it is necessary to understand the legal basis upon which GM's case is founded. Mr Brealey puts it as follows. Although competition law recognises dominant companies' freedom to contract, the dominant company may be forced to contract with a third party where (a) the dominant company unfairly leverages its market power in the dominant market to gain a competitive advantage in the nondominant market (e.g. cross-subsidising the non-dominant market) or (b) the conduct risks eliminating competition in the non-dominant market or (c) the service denied constitutes an essential service or facility. Mr Brealey argues that a class (a) abuse exists here.
32. At first blush, one might have expected GM to have advanced an essential facilities case. However Mr Brealey expressly disavows this. He accepts that the OS website through which the imagery will be made available to the public is not a bottleneck monopoly. GM will not obliterated if it is not on the site (or the link to it is not made more prominent or moved closer to the "front" of the shop). It is still open to it to sell its imagery to all and sundry. It can make it available on the internet and it can supply it to others to do so. Indeed, as Mr Barnes has been at pains to point out, there are many places in the evidence where GM or Mr Cary have stated privately and publicly that they are able to meet the competitive challenge represented by their geocorrected material not being selected for inclusion in the OS site. But although GM does not say that this is an essential facilities case, it is convenient to analyse the legal principles by reference to such cases first. Although this case concerns the effect of the Competition Act, there is no dispute that in all respects relevant to this case, the Act replicates the equivalent provisions in the Treaty of Rome and that the jurisprudence developed under that applies directly to our domestic legislation.
33. The starting point is Case C-7/97 Oscar Bronner [1998] ECR I-7791, a case concerning a dispute between two newspaper groups. Bronner published a daily newspaper in Austria which held about 3.6% of the market by circulation and 6% of the relevant advertising revenue. It complained about the activities of its largest competitor, the Mediaprint group. The latter also sold daily newspapers however its products held 46.8% of the market by circulation and 42% of the relevant advertising revenue. Mediaprint owned the only nation-wide home delivery network for newspapers. Bronner argued that only home delivery could ensure arrival of the daily newspaper to the subscriber in the early morning hours. Because of its small size, it could not afford to set up a distribution network like Mediaprint's. It wanted its newspapers delivered by the Mediaprint network against payment of reasonable remuneration. Advocate General Jacobs analysed the arguments and came to the conclusion that there was no obligation on Mediaprint to allow Bronner access to its home-delivery network. This was so because:

"Although Bronner itself may be unable to duplicate Mediaprint's network, it has numerous alternative - albeit less convenient - means of distribution open to it." (Opinion paragraph 67)

34. He went on to note:

"To accept Bronner's contention would be to lead the Community and national authorities and courts into detailed regulation of the Community markets, entailing the fixing of prices and conditions for supply in large sectors of the economy. Intervention on that scale would not only be unworkable but would also be anti-competitive in the longer term and indeed would scarcely be compatible with a free market economy." (Opinion paragraph 69)

35. His explanation for this conclusion included the following. First he identified the substance of the question referred to the ECJ by the national court:

"The purpose of the national court's first question is to discover whether an undertaking in Mediaprint's position commits an abuse, in the absence of any other factors such as cut-off of supplies, tying of sales or discrimination between independent customers, if it refuses to allow another newspaper publisher to have access to a distribution system which it has developed for the purposes of its own newspaper business." (Opinion paragraph 54)

36. He pointed out that the right to choose one's trading partners and freely to dispose of one's property were generally recognised principles in the mercantile laws of Member State and that incursions on those rights "require careful justification" (Opinion paragraph 56). He went on to say that the justification in terms of competition policy for interfering with a dominant undertaking's freedom to contract requires a careful balancing of conflicting considerations but that;

"... the mere fact that by retaining a facility for its own use a dominant undertaking retains an advantage over a competition cannot justify requiring access to it." (Opinion paragraph 57)

37. He then considered Magill [1995] ECR I-743, the case in which television companies were held to be obliged to offer licences on reasonable terms to third parties who wanted to use their copyright lists of programme schedules. That case has been widely viewed as exceptional and it was so treated by the Advocate General in Bronner. His explanation for the decision in that case to force the holders of the dominant position to give access to their copyright works was expressed as follows:

"It seems to me that intervention of that kind, whether understood as an application of the essential facilities doctrine or, more traditionally, as a response to a refusal to supply goods or services, can be justified in terms of competition policy only in cases in which the dominant undertaking has a genuine stranglehold on the related market. That might be the case for example where duplication of the facility is impossible or extremely difficult owing to physical, geographical or legal constraints or is highly undesirable for reasons of public policy. It is not sufficient that the undertaking's control over a facility should give it a competitive advantage." (Opinion paragraph 65 – emphasis added)

38. This paragraph incorporates a number of principles. First, the fact that a dominant trader has, by virtue of his dominance, a competitive advantage over competitors is not an abuse. It is to be recalled that neither the Treaty of Rome nor our Competition Act prohibits the existence of a dominant position. They only proscribe abuses of it. Second, an abuse may exist only when the dominant trader has a stranglehold on the related market. It is not suggested that any such stranglehold exists here. However this point is also of interest for another reason. Mr Brealey seeks to place clear water between the facts and arguments in the current case and Bronner by suggesting that the latter is only concerned with a dominant trader exercising his dominance in his own market, not an allied one, whereas in this case OS' dominance is said to be in mapping and the abuse is said to take place in a different market, namely making digital colour imagery available to the public. It is not said that OS currently holds a dominant position in the latter market. Third, the Advocate General was clearly not restricting his comments to essential facilities cases.
39. The judgment of the ECJ followed the Advocate General's Opinion. However there is one paragraph in it which is of significance:

"Therefore, even if that case-law on the exercise of an intellectual property right were applicable to the exercise of any property right whatever, it would still be necessary, for the Magill judgment to be effectively relied upon in order to plead the existence of an abuse within the meaning of Article 86 of the Treaty in a situation such as that which forms the subject-matter of the first question, not only that the refusal of the service comprised in home delivery be likely to eliminate all competition in the daily newspaper market on the part of the person requesting the service and that such refusal be incapable of being objectively justified, but also that the service in itself be indispensable to carrying on that person's business, inasmuch as there is no actual or potential substitute in existence for that home-delivery scheme." (Judgment paragraph 41)

40. It will be appreciated that what the ECJ was saying was that even if the dominant trader was able to eliminate all competition and that the service it was withholding was indispensable to carrying out the competitor's business, there was still no abuse unless the refusal to allow access is "incapable of being objectively justified". Once again, this emphasises the difference between the existence of the dominant position and its abuse. An objectively justified exclusion or restriction on trade is not an abuse.
41. Although Mr Brealey does not assert that this is an essential facilities case, he does rely on Bronner. There is one paragraph in the Opinion of the Advocate General which is the foundation for his argument. It reads as follows:

"Under US law the freedom to deal or not to deal is regarded as a fundamental aspect of freedom of trade. US antitrust law, embodied in section 2 of the Sherman Act 1890, essentially aims to protect competition by prohibiting the acquisition or maintenance of monopoly power, rather than by regulating the actions of companies in dominant positions. Nevertheless, the US courts have ruled that there will be an obligation to enter a binding contract where the essential facilities doctrine applies or a company is using monopoly power on one market to achieve dominance of another by anticompetitive means (`leveraging') or where a refusal to deal is intended to eliminate competition and create a monopoly. A refusal to deal by a monopoly is permissible where the intention is simply to choose the company's clients or improve efficiency. It will not be permissible where the refusal leads to reduced competition and higher prices, or reduces in any other way the quality of service or goods in relation to price to the consumer." (Opinion paragraph 46)

42. Although Mr Brealey also relies on Deutsche Post, DHL case No IV/M1168, a decision of the Commission, it is the above paragraph in the Advocate General's Opinion which is the backbone of his argument. Based on this, GM says it can complain about OS' creation of the one stop shop. It appears to me that there are significant problems with Mr Brealey's argument which are set out at paragraphs 29 and 30 above.
43. The paragraph in the Advocate General's Opinion which Mr Brealey relies on is directed to summarising an area of US, not European or UK, anti-trust law. As the Advocate General points out in the paragraph, US law proscribes obtaining a dominant position. That is rather different to what is at issue under s 18 of the Competition Act namely whether an otherwise unobjectionable dominant position has been abused.
44. Furthermore of the three categories of US cases identified by the Advocate General, it is only the second, namely where "a company is using monopoly power on one market to achieve dominance of another by anticompetitive means ('leveraging')" which is relied on here. However the alleged abuse consists of nothing more than a trader in a dominant position in one market using his financial muscle to assist him in entering another.
45. Even if the factual allegation of cross subsidisation were correct, it is difficult to see how this amounts to an abuse in competition law. Indeed, it is apparent from what the Advocate General said that a dominant trader's entry into another market is not an abuse per se. On the contrary, the vice consists of achieving dominance of the new market by anticompetitive means. This is consistent with the decision of the Court of First Instance in Case T-175/99 UPS v Commission (20 March 2002) concerning Deutsche Post AG's decision to acquire joint control of DHL International Ltd ("DHL"). Deutsche Post AG ("DP") enjoyed a reserved postal market in Germany. UPS argued that DP was not entitled to use its exclusive rights for purposes other than complying with its obligation to provide the service of general economic interest with which it was entrusted. In particular it argued that it was not permissible for DP to use the profits from its exclusive market to gain entry into another market. The CFI stated the issue it had to consider in the following terms:

"It is therefore necessary to examine the more specific question as to whether there is an abuse within the meaning of Article 82 EC where an undertaking uses ...profits which it derives from activities for which it enjoys a legal monopoly in order to finance the acquisition of control in a company which is active on a non-reserved market. The Commission considers that this question is to be answered in the negative. Even companies to whom member States have granted an exclusive right in a particular area are not prevented by Article 82 from expanding into other areas. This is without prejudice to the possibility that Article 82 could apply to the behaviour of these companies on the markets for which they enjoy monopoly rights." (paragraph 20)

46. The CFI stated that

"60. The mere fact that [DP] possessed funds enabling it to effect the acquisition at issue does not justify presuming the existence of abusive conduct in the reserved market.

61. In the absence of any evidence to show that the funds used by [DP] for the acquisition in question derived from abusive practices on its part in the reserved letter market, the mere fact that it used those funds to acquire joint control of an undertaking active in a neighbouring market open to competition does not in itself, even if the source of those funds was the reserved market, raise any problem from the standpoint of the competition rules and cannot therefore constitute an infringement of Article 82 EC or give rise to an obligation on the Commission to examine the source of those funds in the light of that article."

47. It follows that it is not a per se abuse for a trader dominant in one market to use his financial muscle to move into a new market. Indeed, were it otherwise, not only would UPS v Commission have been decided the other way, so also would Bronner, since the Advocate General made clear in that case that what Mediaprint was accused of doing was using its muscle in the publishing world to give it a stranglehold in a "related market", namely newspaper distribution.
48. Mr Brealey argues that the vice here is not just that OS has moved into a new market but that it has used public money to achieve that. He did not suggest that there was any authority to support the suggestion that to use public money in this way (assuming it was so used) was an abuse. In my view there is no reason to expect it to be so. If anything, UPS v Commission points in the other direction. DP's profits were obtained as a result of it having a State-granted reserved postal market. No doubt it was able to charge customers higher prices as a result. Furthermore UPS relied on the fact that the German Government had waived its entitlement to the dividends due to it as a shareholder in DP. To that extent, the German Government could be said to be funding DP. Based on these facts, UPS argued that this obligation was the only possible justification for its exclusive right and that "any other use of profits derived from an exclusive right inevitably constitutes an abuse." (paragraph 41). However the CFI stated that

"... the mere fact that an exclusive right is granted to an undertaking in order to guarantee that it provides a service of general economic interest does not preclude that undertaking from earning profits from the activities reserved to it or from extending its activities into non-reserved areas." (paragraph 52)

49. In the absence of contrary authority, it seems to me that the provenance of the funds which enable a dominant trader to enter a new market is irrelevant to the issue of abuse. As long as those funds are not obtained by abusive behaviour in the market in which the trader is dominant and are not used in an abusive way in the new market, there is no breach of s. 18 of the Act. In relation to this I accept Mr Barnes' submission that using funds from the dominant market to allow predatory pricing in the new market would be an abuse, but merely entering the market and enjoying a commercial advantage over others is not. It follows that even if, as GM complains, OS is obtaining a competitive advantage in the imagery market, that does not indicate an abuse of a dominant position.
50. Although Mr Brealey's arguments concentrated on the issue of setting up the one stop shop, behind much of GM's evidence is the suggestion that OS' choice of orthorectification for its digital images is also abusive and that this amounts to some form of unlawful discrimination against GM. Since this case may go further, it might be useful to explain why there is no substance in this point.
51. Mr Brealey conceded that if the court came to the conclusion that it was objectively justifiable for OS to make only one type of digital imagery available on its site, then it could not be an abuse to decide to have only one type of image available. He also conceded that if it was objectively justifiable to choose only orthorectification, then it could not be an abuse so to choose. This may understate the position. As noted above, at paragraph 41 of Bronner the ECJ stated that a trader's refusal to allow a competitor access to his service can only be an abuse where such refusal is "incapable" of being objectively justified.
52. As I think Mr Brealey accepts, to demonstrate that OS' choice of orthorectification is incapable of being objectively justified demands more than showing that a rational trader in OS' position could have made a different choice. In substance it means that OS' choice has to be clearly unjustified. GM gets nowhere near making that out. It is apparent that OS took the view that its digital data should be as accurate as possible. It decided that, even though some existing mapping data was inaccurate, it was undesirable to take that through to the new digital imagery. Having done that, it was driven to choose orthorectification over geocorrection. It is true that Mr Cary criticizes that choice. He says it is fundamentally flawed for three reasons. First he argues that most users of aerial photograph want it to match LandLine and are not interested in the exact true geographical position of every pixel in the photograph - something which orthorectification provides. Second geocorrection is much cheaper than orthorectification and most customers regard price as an important factor. Third the current errors in LandLine may persist for more than 5 years because PAIP has been postponed.
53. Mr Barnes does not challenge the sincerity of Mr Cary's views nor does he suggest that they are irrational. But that does not mean that OS' choice was not objectively justifiable. Mr Murray gave the following evidence relating to the choice of this system of imagery:

"Orthorectified imagery is the standard used throughout the world by most national mapping agencies. Countries with a less detailed national database of geographic information (for example Holland, Finland or Germany) have been using orthorectified imagery for 15 to 20 years in order to update their geographic information."

54. This evidence was not challenged. OS wants to adopt the most accurate system now, not to perpetuate the historic errors in LandLine. Its evidence is that many of its most important customers have a strong preference for orthorectified images. Furthermore, literature produced in GM's own evidence says that in some locations and for some customers geocorrection is preferable to orthorectification while for others it is the reverse.
55. Furthermore, OS has decided only to have one type of imagery in the DNF. An inevitable consequence of the way orthorectified and geocorrected images are manipulated is that they will give different and incompatible views of the same piece of terrain. Some of those incompatibilities will be substantial. OS' evidence is that it does not want to have two incompatible types of imagery in the DNF. It fears that some customers would be confused. Even if that fear proves to be exaggerated, it has not been suggested that this choice was irrational or even unreasonable.
56. I have come to the conclusion that there is no credible case, at this stage, upon which GM could argue that OS' decision to use only one system of digital imagery and to choose orthorectification is incapable of objective justification.
57. For the above reasons, I have come to the conclusion that GM's assertion of breach of s 18 of the Act is very weak. I need go no further than that on this application.
58. I can deal rather more briefly with the other factors which need to be taken into account in deciding whether an interlocutory injunction or declaration should be made here. First, I accept that the financial damage which will be inflicted on GM as a result of a failure to have its geocorrected images on OS' site will be significant. However on a number of occasions Mr Cary has stated that GM is more than capable of meeting the competition from OS and its orthorectified product. Furthermore it should be recalled that GM is about to get the contract to supply OS with 40% of the orthorectified imagery of Britain. There is no reason to believe that GM will be irreparably harmed if it fails to achieve the broadest form of relief sought on this application. On the other hand, I am not persuaded that the more limited relief consisting of requiring OS to put links to GM's website in a more prominent location than they already are on the OS site will significantly improve GM's position pending the trial.
59. As against this, I accept that granting an interlocutory order would prove inconvenient to OS and might result in some of its customers being confused by the presence of two, incompatible, digital photographs of the same area. However I do not think that this inconvenience, though significant, is insuperable or would harm OS as much as exclusion of geocorrected imagery will harm GM.
60. Taking all the above factors, including in particular the weakness of GM's case, I have come to the conclusion that interlocutory relief is not appropriate. In so doing, I have not found it necessary to take into account Mr Barnes' argument that GM has been guilty of excessive delay in seeking interlocutory relief.
61. Notwithstanding the above, it obviously makes sense not only to the parties but to their customers that the issue of what imagery is available on DNF is resolved as soon as possible. I will hear counsel on the issue of whether there should be an order for a speedy trial, and, if so, the timetable necessary to achieve it.