Daniel Jowell QC, Brick Court ChambersDaniel Beard QC, Monckton ChambersDr Cristina Caffarra, Charles River Associates
THE DOW AND NATIONAL GRID LITIGATION
LESSONS FROM RECENT FOLLOW-ON DAMAGES CASES:
23 September 2014, Herbert Smith Freehills LLP
DANIEL BEARD Q.C.
NATIONAL GRID V ABB & ORS
DANIEL JOWELL Q.C.
COOPER TIRE V DOW
The drunken woman and her dog, the blindfolded man walking across a bar,
and the man looking for his keys under the lamppost…
A tale of cartel overcharges
Cristina Caffarra, 23 September 2014
Issues
• Complexity
• Link between quantitative analysis and factual evidence
• Prior beliefs
Synthetic rubber
Jan 92 Jan 94 Jan 96 Jan 98 Jan 00 Jan 02 Jan 04 Jan 06 Jan 08 Jan 10
price cost excess demand
Deflated using correct cost index: no overcharge
Deflated using incorrect cost index:positive overcharge
45
67
8P
rice
1990 1995 2000 2005 2010 2015Year
Observed (Nominal) pricesCorrectly-deflated pricesDeflated prices with overly-steep index
GIS: Choice of index makes overcharge find more likely
Deflating by wrong index can lead to finding overcharge when none exists
Indices with steep s-shape make finding overcharge more likely
RELEVANT FACTUAL EVIDENCE ON OVERCHARGE
• Nature of the cartel: were the terms clear and specific?
• Transparency: could adherence to the cartel be monitored?
• Buyer power/buyer resistance • Substitute products outside cartel (e.g. natural rubber)• Existence of producers within the region outside the
cartel (Kaucuk/TS)• Import of the products from outside the region• Non compliance/cheating; absence of enforcement
THE DEUTSCHE BAHN ISSUE
• Original Commission decision: Kaucuk and Trade Stomil cartelists• Original pleading: Kaucuk and Trade Stomil defendants • Case T-44-45/07, T-53/07 General Court: Kaucuk and Trade Stomil not
cartelists• Amended pleading: claim against Kaucuk and Trade Stomil withdrawn,
but umbrella claim in respect of their sales against other Ds • Case C-557/12 Kone • Deutsche Bahn [2014] UKSC 24 esp. paras. 27-28• Re-Amended pleading: Dow jointly and severally liable for K and TS sales• Cooper Tire v Dow Deutschland [2014] EWHC 1578 (Comm) –
amendment allowed, no reference yet as “no doubts” as to Supreme Court’s approach
DANIEL BEARD Q.C.
PASS ON ISSUES IN NATIONAL GRID
Indirect purchasers/passing on
Bad plc
Passin’ Thru LTD Low Margin Co.
Kind Ltd Sweet Ltd Innocent Ltd
x + £1 x + £1
y + £1 y y
BIG plc Ugly plc
Indirect purchasers/passing on
Bountiful plc
Buyer power inc Mega dist co.Y
Optimist Chancer
x + £1x + £1
Beautiful plc Unjustified criticism plc
Fleecer
Indirect purchasers/passing on
Bountiful plc
Buyer power inc
Pretty much everyone
x + £1
Beautiful plc Unjustified criticism plc
Regulatory controls
a ladder
SETTLEMENT TACTICS
QUESTIONS?
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