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Commercial court gives limitation judgment in DRAM competition damages claim

25/02/20

Mr Justice Foxton today handed down his judgment following the trial of a preliminary issue concerning limitation in a follow-on action arising out of the DRAM cartel. He found that the claims brought by Granville Technology Group (and the connected company VMT) were time-barred but that the claim brought by a third company – OTC – was not.

The Defendants, Infineon Technologies AG and Micron Europe Ltd, were found by a European Commission decision of May 2010 to have participated in a cartel that covered DRAM, a type of computer memory, from 1998 to 2002. Granville, VMT and OTC were computer manufacturers who purchased DRAM at that time. All of the Claimants subsequently went into liquidation between 2002 and 2007. In May 2016, just under six years from the date of the Commission’s decision, the liquidators filed claims for follow-on damages on behalf of the companies.

The Defendants pleaded that the claims were time-barred and a preliminary issue on limitation was ordered.

The Claimants argued that, although the claims related to conduct of 20 years ago, s.32(1)(b) of the Limitation Act 1980 applied so that time did not start running until the announcement of the Commission’s decision. The Defendants argued that time started running far earlier because there was information in the public domain from 2002 about the US Department of Justice (“DOJ”) investigation into the DRAM cartel. The Claimants accepted that Granville and VMT (but not OTC) had actual knowledge of the DOJ investigation but denied that this sufficed to plead a standalone claim for breach of EU competition law in respect of purchases made in the UK.

Mr Justice Foxton found that a standalone claim against the Defendants in the EU could have been brought earlier, based on what was known and/or knowable about the Defendants’ conduct. As a result, he found that the claims brought by Granville and VMT were time-barred.

However, Mr Justice Foxton found that OTC was in a different position because it had gone into liquidation prior to any reports into the DOJ investigation. He held that the fact of OTC’s liquidation affected the test for constructive knowledge. In particular, he rejected the suggestion that OTC should be assumed for the purposes of s.32(1)(b) to have the same knowledge as a trading computer manufacturer that was still involved in the acquisition of DRAM. Rather, he found that a reasonably diligent liquidator would not have been on notice of any facts triggering a need to investigate further. He therefore concluded that OTC’s claim was not time-barred.

The judgment is here.

David Scannell acted for the Claimants (instructed by Osborne Clarke).

Sarah Ford QC and Tim Johnston acted for the First Defendant, Infineon (instructed by Slaughter & May). Zahra Al-Rikabi is also instructed by Slaughter & May for Infineon in the proceedings.

Daniel Jowell QC and Emily MacKenzie acted for the Second Defendant, Micron (instructed by Allen & Overy).