Albion v D ŵ r Cymru Implications for Damages Litigation Meredith Pickford Barrister Monckton Chambers Matthew Cook Barrister One Essex Court, Temple 1

Quantification of damages and evidence Loss of a chance Counterfactual in compensation claims Interest in compensation claims Exemplary damages Overview 2

See Commission Staff Working Document – Practical Guide on Quantifying Harm (11 June 2013) Determination of the Effect of the Infringement i.e. how would the market have operated in the absence of the infringement. May involve price effects or exclusionary effects. For price case, have to determine what the level of prices would have been without the infringement and so extent of overcharge. Consider Volume Effect Has loss been passed-on Quantification of Damages 3

Comparator Based Method – looking at periods before/after infringement or markets unaffected by infringement Economic Simulation Model – prediction of market behaviour through economic theory Cost based – estimates prices that would have emerged based on cost plus reasonable profit Finance method – estimates effect of infringement based on financial performance of the claimant or defendant. Options for Quantifying Overcharge 4

The infringement involved a breach of the Chapter II prohibition based on overcharging. What could DC lawfully have charged? What would DC have charged if it had acted lawfully? Albion – Simple case of Overcharge 5

A rise in prices can lead to less demand. Quantify any reduction in demand and consequent loss of profit. Not relevant in Albion Quantifying the Volume Effect 6

What percentage of the loss has been passed on to customers. In Albion, contract determined how reductions in price would be shared between Albion and its customer. Passing-On 7

Factual Evidence – what would relevant companies have done in hypothetical counterfactual. Economic Evidence. Accounting Evidence. Evidence 8

Allied Maples Group Ltd v Simmons & Simmons [1995] 1 WLR 1602 Where loss depends on the hypothetical actions of a third party which would have conferred a benefit on the Claimant, the Claimant has to show he had a substantial chance rather than a speculative one of obtaining that benefit. If so, the evaluation of the substantial chance is a question of quantification of damages. Contract with third party (Corus) – reduction of 33%. Loss of a Chance 9

The but for world had the abuse not been committed Livingstone v The Rawyards Coal Co (1880) 4 App Cas.25 at 39 – classical test in tort Cited in Devenish v Sanofi [2009] 3 WLR 198 at [43] Enron Coal v EWS [2009] CAT 36 at [90] Counterfactual 10

DC: Assume DC would have charged the highest price that able to establish at trial would have been lawful Rejected by the Tribunal: Practicability Principle Alternatives (Banque Bruxelles v Eagle Star [1997] AC 191) Counterfactual: Excessive pricing context 11

Damages – requires a counterfactual National Grid v GEMA [2010] EWCA Civ 114 – no counterfactual required Counterfactual: Interrelationship with Substantive Test 12

Albion: sought compound or 8% simple. Basis for compound claim – Sempra Metals v IRC [2008] 1 AC 561 Tribunal: 2% above base rate Government: a matter for legislation Interest 13

Rookes v Barnard (No 1) [1964] AC 1129 Outrageous and contumelious behaviour. Needed to show: DC knew, or probably knew, that its conduct was unlawful Nonetheless cynically calculated that the benefits from such conduct outweighed the likely damages that would be payable Non bis in idem and related points Exemplary Damages 14

Questions? 15

Meredith Pickford Monckton Chambers Matthew Cook One Essex Court 16