In a decision setting a new precedent in French competition law, a French court orders the stay of proceedings in a French follow on damages case against two defendants which were condemned by a European Commission cartel decision. The reason for the stay was that the defendants in question were appealing the validity of the Commission’s Decision before the European General Court.
The decision in Ordonnance du Juge de la mise en état du Tribunal de Grande Instance de Rennes of 17 October 2013, n° 13/00136 stayed the French proceedings in the follow-on damages claim. The proceedings were stayed on the grounds that under Article 378 of the French Civil Procedural Code, the French court has the power to stay proceedings in a domestic case until the final judgment is delivered where a EU Commission’s Decision has been challenged.
The facts of the case relate to an animal feed cartel, condemned by the Commission in 2010. The two defendants in the present case were beneficiaries of the leniency programme in connection with this cartel and were named in the subsequent Commission Decision. However they have now appealed the validity of the Commission’s Decision to the General Court where the case is currently pending. Following the publication of the Commission’s Decision in 2010, victims of the animal feed cartel sued the two defendants for follow-on damages in France on the basis that they were implicated in the Commission’s Decision. The two defendants asked for an immediate stay of the domestic proceedings until the conclusion of the appeal at the European General Court.
The granting of this stay seems a pragmatic decision of the French courts and is not unusual in similar types of cases in other jurisdictions. The effect of the ruling will however cause significant delay and will further frustrate the victims of the cartel in their quest for follow on damages.