CMA closes fourth abuse of dominance investigation into pricing of hand sanitiser

CMA closes fourth abuse of dominance investigation into pricing of hand sanitiser

The Competition and Markets Authority (CMA) has closed the final abuse of dominance investigation it started in June 2020 into suspected unfair and excessive pricing of hand sanitiser by four pharmacies and convenience stores.

The CMA closed three of the investigations in July.

The CMA closed the fourth investigation having had regard to its prioritisation principles.

The CMA considers that it is unlikely that the suppliers’ prices infringe competition law.  It concludes that further investigation to reach a definitive view would deliver limited, if any, consumer benefits.

The CMA’s decision to close the case does not prevent it from opening an investigation in the future if it were to receive new evidence that changed its assessment.

https://assets.publishing.service.gov.uk/media/5f50df3f8fa8f535b650435c/3_September_2020_case_closure_statement.pdf

CMA secures director disqualification in pharmaceutical cartel proceedings

 

 

CMA secures director disqualification in pharmaceutical cartel proceedings

The Competition and Markets Authority has secured a competition disqualification undertaking by Mr Robin Davies, director of Alissa Healthcare Research Limited.

The disqualification undertaking relates to his involvement in breaches of UK and EU competition law in relation to the exchange of commercially sensitive information in connection with the drug nortriptyline.  Alissa and King Pharma admitted to the illegal conduct and received fines of £174,912 and £75,573, respectively.  Lexon did not settle and was fined £1.2 million.

The Company Directors Disqualification Act empowers the CMA to ask the court to disqualify a director from holding company directorships or performing certain roles for a specified period, if the director’s company has breached competition law.

Davies undertakes not to act as a director of any UK company for two years as of 24 November 2020.

Davies is the 18th director to agree to a director disqualification undertaking.

Separately, but arising out of the same competition law investigation the CMA has applied to the High Court to seek the disqualification of Mr Pritesh Sonpal, a director of Lexon (UK) Limited.

 

https://www.gov.uk/cma-cases/suppliers-of-antidepressants-director-disqualification

Supreme Court hands Unwired Planet victory in FRAND dispute

Supreme Court hands Unwired Planet victory in FRAND dispute

In a long awaited judgment, the Supreme Court has confirmed that Unwired Planet (Unwired) did not abuse its dominant position when seeking an injunction against the use by Huawei of its standard essential patents (SEPs).

The Court found that Unwired had been willing to grant a licence to Huawei and ZTE on fair, reasonable and non-discriminatory (FRAND) terms.

The Court also confirmed that Unwired did not act abusively when it sought an injunction when the putative licensees objected to its licensing terms.

The Court defeated Huawei’s antitrust claims, including the argument that Unwired had acted in a discriminatory manner by offering Huawei royalty rates that were higher than those offered to Samsung.

The ruling marks the end of a dispute going back to 2014 and will be welcomed by SEP holders.  The analysis revolved mostly around contract law and industry practice.  Parties seeking to rely on competition arguments in defence to claims of IPR infringement will need to consider their position carefully in light of the judgment.

[2020] UKSC 37 On appeals from: [2018] EWCA Civ 2344 and [2019] EWCA Civ 38

https://www.supremecourt.uk/cases/docs/uksc-2018-0214-judgment.pdf

Royal Mail ordered to continue freepost service to medical testing company

Royal Mail ordered to continue freepost service to medical testing company

 

The High Court has granted an interim injunction ordering Royal Mail to continue providing a freepost service to Preventx, a medical testing provider.  It found that Royal Mail’s contractual terms could amount to an abuse of a dominant position, including through the imposition of an unreasonably short notice period for migrating to new terms.

Preventx had not set out an arguable case in its application for an injunction as regards its allegations of unfair trading terms and limitation of the market.

The High Court granted an injunction to restrain Royal Mail until trial or further order from: 1) refusing to continue to provide its Freepost Standard service to Preventx for returns of test samples for so long as it cannot offer its Tracked returns service and 2)  refusing to process and deliver test samples returned to Preventx bearing labels for the Freepost Standard service.

The Court found that Royal Mail’s £3.50 offer to process returned test samples is “substantially higher” than the current rate and is “in effect a coercive threat to persuade Preventx” to use the tracked service.

Preventx Limited v Royal Mail Group Limited [2020] EWHC 2276 (Ch)

Google and Facebook sued in class action in crypto-advertising

Google and Facebook sued in class action in crypto-advertising

A class action has been launched against Google and Facebook in Australia alleging that they breached competition law through a ban on all crypto-advertising.

The action is brought by JPB Liberty CEO Andrew Hamilton in the Australian Federal Court. Reports state that the class comprising crypto industry members and investors has incurred $600 million in damages claims, potentially increasing to $300 billion.  In addition to damages, the action seeks an order that Facebook and Google provide free advertising to the class members

JPB Liberty was established to pursue litigation “against those who attack the Cryptocosm [companies powered by blockchain technologies] unlawfully”.

The lawsuit has an interesting parallel in Europe where in August 2019 the European Commission opened a preliminary investigation into Facebook’s Libra over concerns with its data collection practices.  However, it appears that Facebook has more limited plans for Libra.  Also in 2019 the Australian Competition and Consumer Commission released its digital platform inquiry report finding that Google and Facebook have substantial market power in multiple segments of their markets.  This echoed concerns of the UK Competition and Markets Authority in its own probe into the sector

https://res.cloudinary.com/gcr-usa/image/upload/v1597398251/First_Statement_of_Claim_13_Aug_2020_dtehqg.pdf

CMA fines Pentland and JD Sports for breach of Initial Enforcement Order

CMA fines Pentland and JD Sports for breach of Initial Enforcement Order

 

The Competition and Markets Authority has fined Pentland Group Limited (Pentland) and JD Sports Fashion plc (JD Sports) for their failure to comply with an initial enforcement order (IEO) in the context of the completed acquisition by JD Sports of Footasylum plc.

The breaches arose from the service of a break notice by Footasylum to close its Wolverhampton store.  Specifically, the parties failed to comply with the IEO by not procuring that, except with the CMA's prior written consent or in the ordinary course of business for the separate operation of the Pentland business and the Footasylum business.

The CMA did not consider that the impact of COVID-19 on the parties’ financial resources was sufficiently material to impact the level of the penalty.  However, given the significant short-term impact of COVID-19, the CMA has deferred the deadline for the payment of the penalty for nine months.

https://assets.publishing.service.gov.uk/media/5f2975608fa8f57acc8d8231/IEO_breach_-_Final_-_web_version_---_pdf_a.pdf

CMA clears Amazon’s acquisition of minority stake in Deliveroo

CMA clears Amazon’s acquisition of minority stake in Deliveroo

The Competition and Markets Authority (CMA) has cleared the acquisition by Amazon of a minority (16%) shareholding in Roofoods Ltd (Deliveroo).

The unconditional clearance follows a phase 2 investigation.  The CMA concludes that the acquisition would not be expected to result in a substantial lessening of competition in the supply of online restaurant platforms or online convenience grocery in the UK.

The CMA found that absent the transaction Amazon would be likely to re-enter the online restaurant platform market in the UK, but it would not in any event substantially lessen competition.

The CMA also concluded that Amazon’s investment in Deliveroo is unlikely to discourage Deliveroo from competing on online convenience grocery services, nor would it remove the strategic benefit to Amazon of developing its own competing service.

The decision focuses on Amazon’s 16% interest in Deliveroo amounting to material influence.  If Amazon were to acquire a more significant interest amounting to a stepping up in the level of control, this would trigger a new relevant merger situation and would invite further scrutiny by the CMA.

https://www.gov.uk/government/news/cma-clears-amazons-16-investment-in-deliveroo