On 30 October 2014, the UK High Court ruled that the 6 year limitation period for bringing competition claims will be interpreted strictly. The Court struck out claims brought against a credit card company by a number of high street retailers on the basis that those claims related to damage incurred over 6 years ago. The retailers had argued that claims over 6 years should be recoverable due to the nature of the defendant’s offence.
They alleged that the defendants were implicated in a price fixing agreement in the credit card market centring around multilateral interchange fees (MIFs) and the nature and extent of the agreement including the level of price fixing had remained secret. The defendant’s have now bought their claims following the 2012 European General’s Court dismissal of MasterCard’s appeal against the 2007 MasterCard Decision. The MasterCard decision is the basis of the claimant’s evidence as there is no regulatory decision against the current defendants.
The UK High Court did not share this view and interpreted the limitation period strictly. The Court in particular did not share the claimant’s view that the exception in section 31(1)(b) of the Limitation Act 1980 extended to the retailer’s circumstances. In the Court’s view, the case against the defendant was not so concealed that the retailers could not have bought their claim earlier, therefore, any claim older than 6 years would be out of time.
The Court held that the claimant had not conclusively established any factual reason why they should not have brought their claim earlier and thus been in a position to recover a much higher level of damages. The Court held that the claimant’s current case was built on facts that were known over 6 years ago and that the general nature of the price fixing cartel at that point had been known. The exact level of the cartel price fixing was held to be immaterial to bringing a claim.
Following this case, it is clear that a UK claimant for competition law damages is put on notice when the general nature of the cartel or claim becomes public. They are not entitled to freeze historical claims over 6 years old and thaw them as such when the full and technical details of the cartel have become clear.
There are two things of further note about this particular case. The first is that the Court were not sympathetic to any pleading by the claimant’s that the 6 year limitation period being considered in the Court’s way would deny them over £500 million in potential damages. The Court held that the level of potential damages was not a legitimate consideration when examining challenges to the limitation rule.
The second aspect of note is the upcoming EU Directive of Private Actions which will create a new EU wide limitation period of at least five years that it is interrupted or suspended from the moment a competition authority starts investigating an infringement until at least one year after the infringement decision has become final. This means that victims will have at least one year to claim damages following the decision of a competition authority. The Court considered the incoming Directive but noted that the Directive itself made provision for any claims (brought prior to national legislation bringing the Directive into force) to be unaffected.
Until the EU Directive comes into force, this is now the leading case on competition limitation claims and should act as strict guidance for those considering bringing claims following competition law infringements. What appears important to the court was establishing a degree of certainty for companies and the ready availability of evidence in upholding the integrity of the 6 year statutory limitation rule in section 2 of the Limitation Act 1980.
Arcadia Group Brands Ltd & Ors  EWHC 3561 (Comm), judgment of 30 October 2014