MasterCard’s renewed application for a stay of damages proceedings dismissed

15/10/13

On 11 October 2013, Mr. Justice Field dismissed a renewed application by a number of Defendant entities within the MasterCard Group for an immediate stay of the proceedings brought by 12 large UK retailers for damages.  In those proceedings,  Morrisons and eleven other high-street retailers are claiming damages in respect of losses allegedly suffered as a result of the arrangements for the setting of multi-lateral interchange fees ("MIFs") on MasterCard transactions from 1992 onwards.  Interchange fees are fees paid on payment card transactions by acquiring banks to issuing banks and MIFs are those fees which apply by default between issuers and acquirers in the absence of a bilateral agreement.  The Claimants allege that the MasterCard arrangements infringed both European and UK competition law and they are claiming damages in sums ranging between  £400 million to £1billion, depending on the applicable limitation period,  thereby making this one of the largest private damages actions ever to have been brought before the English courts.  The arrangements for setting the European and UK MIFs have been the subject of various regulatory investigations and proceedings over many years.  In December 2007 the European Commission adopted an infringement decision concerning the European MIF.  The Commission Decision was addressed to various MasterCard entities which, having appealed unsuccessfully to the General Court, are now appealing against it to the CJEU.  

An earlier stay application was dismissed by the same judge on 3 May 2013 (see news report).  The Defendants argued now that the Court should reconsider its position given that the oral hearing had taken place in the appeal before the CJEU, the Advocate General would be handing down his Opinion at the end of November 2013, that it was likely that the CJEU would hand down its judgment in the Spring of 2014 and that if the stay was not granted, the Defendants could be subject to very onerous disclosure requirements.  The judge refused the application, relying once again on the principles that were established by the Chancellor in National Grid Electricity Transmission plc v ABB Limited and others [2009] EWHC 1326.  He allowed an application by the Claimants for a split trial to allow liability to be determined before quantum.  He also ordered that matters of applicable law and limitation be tried as preliminary issues, with disclosure on those issues going back to 1992.  Insofar as standard disclosure was concerned, the judge ordered that it should initially be restricted to the ordinary period of 6 years, until the issue of limitation had been determined.  Finally, he stated that he would write to the European Commission and the OFT in relation to documents that they held in connection with their respective investigations into the EEA and UK MIFs, with a view to their disclosure by the Defendants in the context of the present proceedings.

The judgment is here.