On 8 July 2020, The German Lower Regional Court of Dortmund ("Court") recently handed down its ruling regarding follow-on damages against a specialist wholesale company for sanitary and heating products. Damages were sought following a fine of the German Federal Cartel Office ("FCO") relating to coordinated of price calculations. In its ruling, the Court comments on the general liability of group companies for damages caused by the economic unit they belong to as well as the necessary evidentiary burden placed on the plaintiff for the assertion of damages in follow-on antitrust proceedings.
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- In accordance with the Skanska judgment, the Court considers a (group) company may be liable for damages resulting from a violation of competition law committed by another entity within the same group.
- The claimant needs to establish and prove sufficient facts with respect both being affected and actually harmed by the anti-competitive conduct. It is not sufficient to simply refer to general economic evidence which does not cover the specific dispute at hand.
- In instances where claimant meets such requirements, the court may estimate the damages to be awarded "free-handed". In such cases, the court may also consider the specifics of the respective anti-competitive behaviour.
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One of the hot topics in private enforcement of competition law at the moment is the question of to whom liability for damages caused by anticompetitive behaviour extends. This question is particularly important in instances when a claim is brought against a (group) company which was not itself found to have infringed competition law, but which belongs to the same "economic unit" as the group entity that was subject to an infringement decision.
In its ruling, the Court challenges the positions of other German courts of first instance. The Court confirmed, drawing on the principles of the ruling of the European Court of Justice in Skanska, that group companies are generally liable to cartel damage claims regarding breaches of competition law by other companies of the same group.
The Court, however, did not need to take its assessment any further as the action was unsubstantiated with respect to other prerequisites for liability under German law. The action was thus dismissed. Nevertheless, the Court seemed to sympathize with the a "free-handed" estimation of the amount in damages to be awarded by the judge. However, it was stressed that such an estimate requires the claimant to substantiate its claim, i.e. to properly establish the facts to base such estimate on.
In the present case, the Court found the claimant to have not met this requirement, since it only submitted a vast number of documents (much of which did not relate to the concerned products) and had relied on generic references to studies in order to determine the damage suffered. The Court ruled that a "free-handed" approach to calculating damages is only applicable if the facts presented allow the other party to effectively defend itself against such claim; in addition, the specific circumstances of the anti-competitive conduct also needs to be considered.
