Putting the brakes on post-Brexit?

12/05/23

On 12 May 2023, Butcher J handed down judgment granting two applications challenging the Commercial Court’s jurisdiction to try follow-on claims brought by Mercedes on forum non conveniens grounds.

On 21 February 2018, the European Commission found that certain companies in the Continental, Bosch and ZF Groups of companies had infringed Article 101(1) TFEU by exchanging information regarding hydraulic braking systems for passenger cars (the “Infringement”).

On 13 September 2022, Mercedes issued proceedings against seven companies in the Continental and ZF groups claiming damages as a result of the Infringement. Two of those companies are based in England or Wales (the “UK Defendants”) and the remaining five are based in Germany (the “German Defendants”). 

The UK Defendants brought applications to stay the proceedings on forum non conveniens grounds and the German Defendants brought applications to set aside service of the proceedings on them in Germany on the same basis.

Mercedes contended that the English court was familiar with follow-on proceedings and that the well-known principles articulated by Lord Goff in Spiliada Maritime Corp v Cansulex Ltd [1987] AC 460 had to be applied in light of the realities of litigation in the third decade of the twenty-first century, including the transmissibility of modern documents and the ease with which witnesses can travel. However, notwithstanding those realities, Butcher J held that Germany was the forum with which the dispute had its closest and most real connection and granted the applications accordingly.

Butcher J’s decision is the first to consider the application of the forum non conveniens principles in follow-on litigation after Brexit. It raises interesting questions about the ability of claimants to rely on English “anchor” defendants to found jurisdiction and the application of the Spiliada principles to modern competition litigation more generally.

The judgment is available here.