General Court orders EU to pay damages for excessive delay in court proceedings

The General Court has ordered the EU to pay damages of more than EUR50,000 to Gascogne due to the excessive duration of proceedings before the European courts in dealing with its appeal against the Commission’s decision in the industrial bags cartel.

The Court considered that the right to adjudication within a reasonable period, embodied in the Charter of Fundamental Rights, was infringed as a result of the excessive length of proceedings of some five years and nine months.

The award amounts to around 1 per cent of Gascogne’s original claim for EUR4 million in respect of “material harm” that it suffered in the course of the litigation. The award is intended to cover the costs of the Gascogne group companies’ bank guarantee and compensation for non-material harm to cover unreasonably high amounts of uncertainty due to excessively long litigation.

The award confirms an important point of principle on the merits, although the level of the award suggests that companies appealing for an award that is higher than their litigation costs will face an upward struggle.  It is hoped that this award will provide an incentive to accelerate court proceedings in competition cases, but the Court has given itself some flexibility by noting that a long decisional period might be justified by the special circumstances of the case, for example in cases that are highly complex or involve multiple issues.

There are also four other damage claims before the European courts in respect of the excessive duration of proceedings in the copper fittings, industrial bags and flat glass cases.

Case T-577/14 - Gascogne Sack Deutschland and Gascogne v Court of Justice, judgment of 10 January 2017