Germany: Advocate General: Removal of the Only German Participant in a Cartel Damages Case From Litigation Does Not Prevent the Claim From Being Pursued in Germany

On Dec. 11, 2014, Advocate General Niilo Jääkinsen advised that a German court could retain jurisdiction over a cartel damages claim even after the only German defendant company has reached a settlement.

In May 2006, the European Commission fined the members of a hydrogen peroxide cartel. Several companies that claimed to have suffered damages as a result of this cartel assigned their rights to any damages from actions against the cartel members to a Belgian company called Cartel Damages Claims Hydrogen Peroxide SA (CDC). CDC brought a claim before a German regional court against six of the cartel members, one of which was a German company.

Under the Brussels I regulation, a company must generally be sued in the Member State in which they are domiciled. Where there are several defendants, they may be sued in a Member State where any one of them is domiciled if the claims are closely connected enough that it would be desirable to hear them together to avoid contradictory judgments on the same facts being made in different Member States.

In September 2009, the German defendant and CDC reached a settlement and CDC withdrew its claim against this company. The other companies against which CDC had a claim then challenged the jurisdiction of the German court on the basis that none of them were domiciled in Germany. The German court requested that the Court of Justice of the European Union rule on several questions on international jurisdiction within the EU.

Jääkinsen stated that the general rule regarding jurisdiction should not apply in this case because the cartel's operation had been substantial enough to have affected the whole of the EU. He advised that the infringement had been a single ongoing action over a long period and a wide area. Therefore, there was a risk that allowing the case to be heard in the courts of more than one Member State would lead to unequal treatment of the defendants. Consequently, he concluded that the Brussels I regulation allowed for the companies all to be tried in the same court.

Jääkinsen warned that this opinion must not be applied abusively to allow forum shopping. The opinions of the Advocate General aren't binding on the Court of Justice, which will issues its ruling next. The case reference is C-352/13 and Jääkinsen's opinion is available 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.