Fast track CAT injunctions

26.06.2014

Earlier this month, I attended an interesting lecture at the Law Society given by Mr Justice Roth, President of the Competition Appeal Tribunal (CAT). The lecture dealt with the current reforms to private competition litigation in the EU and UK, including the recently adopted antitrust damages directive and the CAT’s draft rules on collective actions – both of which have received significant media attention. Mr Justice Roth also spoke briefly on the less well publicised – but potentially very significant – proposals to empower the CAT to hear standalone competition actions, grant injunctions and set-up a ‘fast track’ procedure aimed primarily at smaller companies seeking injunctive relief for alleged infringements of competition law.

The proposals require Parliament to pass the Consumer Rights Bill, which looks set to happen later this year or early next year (it has gone through the Commons and is now in the House of Lords). What’s the IP / Competition interface angle? Well, a number of injunction disputes under the existing rules in the High Court have been in the IP heavy sectors (e.g. InteCare & Chemistree) – these sorts of cases may in future be considered for the CAT’s fast track. This is a topic close to my heart, as it was on this subject that I spoke at the 8th Junior Competition Conference in January this year (and for which I featured for the first time in a tweet). But to get back on track: one of the key issues for the fast track is deciding which cases will actually be ‘suitable’ for fast-tracking. The fast track will offer a number of procedural advantages to claimants – in particular caps on liability for costs and a cap on damages for any cross-undertaking in damages given for interim injunctions. So it is clear that there will big disputes over ‘suitability’ between claimants keen to get their claims fast-tracked and defendants trying to avoid fast-tracking at all costs.

Consideration of the fast track proposals is still at an early stage. Mr Justice Roth explained some of the current options for deciding suitability include the following:
• whether the case could be tried within 6 months of the claim being lodged,
• whether the trial could be heard within 3 sitting days,
• whether little or no disclosure would be necessary,
• whether little or no expert evidence would have to be called.
Roth J also indicated that the CAT would seek to draw lessons from the introduction of the Intellectual Property Enterprise Court (IPEC) which has handled smaller IP disputes very successfully. The current proposals are yet to be finalised, once drawn up the draft rules will be published and subject to a public consultation.

I look forward to seeing the draft rules. I would hope that the rules adopted are more flexible than those outlined above appear to be. Whilst a relatively short and predictable timeline to trial is a good thing, if trials are organised too hastily this might increase cost and erode the quality of justice that the CAT can dispense. I doubt that every fast track trial needs to be resolved within six months. In my view, a limit to the length of a trial is a good thing, this would also probably be the best criterion for deciding suitability for fast-tracking, but 3 days is highly ambitious. The IPEC deals with all cases within 2 days, but IP disputes typically require significantly less fact evidence than do competition cases. Without sufficient fact and expert evidence, the court will reach judgments essentially on the basis of the burden of proof, as seems to have occurred in the recent Martin Retail case – a one day preliminary issue tried before the Central London County Court. This is far from ideal. Restrictions on disclosure will help reduce cost, but I would expect that some very targeted disclosure will be necessary in virtually all cases. I do not think expert economics evidence can ever be dispensed with if the CAT is to reach sound judgments, I very much doubt that written expert evidence alone is adequate. There is a good case for tightly regulating oral testimony, but the CAT should be extremely cautious to dispense with it entirely. Time is needed to test fact and expert evidence, which is why trial length should be considered carefully.

For those interested to learn more about the background to the Fast Track proposals, what lessons might be drawn from the IPEC, and a few other thoughts, I have recently had an article published on just this topic in the latest edition of the Competition Law Journal. Jordan Publishing Limited has very kindly given permission for this to be reproduced. For a link to the article click here.