This applies, on the one hand, to the threshold of proof for the occurrence of damage under civil procedure law, the exceeding of which is a prerequisite for a basic judgment. On the other hand, the FCJ places an equitable limit on the passing on of cartel-related price increases to the next market level as (damage-excluding) equalization of benefits if the occurrence of scattered damages would ultimately relieve cartel participants from being held liable.

Course of proceedings

In the appeal decision overruled by the FCJ, the Higher Regional Court (OLG) Dusseldorf had to rule on a claim for damages following price, quota and customer agreements sanctioned by the Federal Cartel Office. The plaintiff had purchased track materials from one of the manufacturers involved in the “rail tracks cartel” during the period of the prohibited agreements.

In the first instance, the Dusseldorf Regional Court had awarded the plaintiff, a public transport company, damages and expert costs on the merits. The basic judgment challenged on appeal was based on a prima facie evidence of the cartel involvement and assumed that the plaintiff was likely to have suffered damages as a result.

The OLG Dusseldorf confirmed the decision in its ruling of January 23, 2019 (Case No.: U (Kart) 19/17) and did not allow an appeal. For the assumption of damage, it explicitly relied on a factual presumption according to which an antitrust infringement in cartel affected transactions also leads to damage for the claimants on the opposite side of the market. The OLG Dusseldorf rejected the objection of equalization of benefits by passing on the damage to the passengers, because the defendants had not plausibly argued that a pass-on of the damage was likely here.

Key messages from the FCJ

The FCJ reversed the judgment of the OLG Dusseldorf and referred the case back to another court chamber for a new hearing and decision.
In particular, the FCJ counters the criticism of its landmark decision “Schienenkartell I” by the OLG Dusseldorf. Contrary to the OLG Dusseldorf, the fact that a transaction is affected by a cartel does not give rise to a rebuttable factual presumption of the likelihood of damage that could justify a basic judgment. Rather, the probability of the occurrence of damage is to be determined within the framework of an overall assessment of all circumstantial facts that have been presented for and against the occurrence of the damage.

Furthermore, the FCJ specifies the relationship between benefit sharing and the effectiveness of private enforcement, whereby the objection of passing on damages (“passing-on defense”) in the case of “scattered damages” ultimately burdening the passengers is not excluded for factual but for legal reasons.

  • The (rebuttable) presumption of likely damages due to the conclusion of transactions affected by the cartel, on which the appeal decision is based, is not in line with the case law of the FCJ. It is true that the cartel does indeed give rise to the presumption that the prices achieved under the influence of the cartel are generally higher than under undistorted competitive conditions. This factual presumption also gains weight with the duration and effect of the cartel, but does not justify a reversal of the burden of proof. Accordingly, the parties to the cartel do not have to prove that no damage has occurred at all. They rather have to present circumstantial evidence that speaks against the occurrence of damage. The trial court must then, within the framework of a comprehensive overall assessment, evaluate all the circumstantial facts speaking for and against the occurrence of the damage in accordance with Section 287 (1) German Code of Civil Procedure (ZPO), with regard to the probability of the occurrence of the damage.​
  • In order to defend itself against a claim by passing-on cartel-related price increases to the next market level, defendants must plausibly demonstrate that a passing-on of the damage is a viable option on the basis of tangible evidence (in particular market conditions). The standard for this is set out in Section 287 ZPO requiring a probability assessment only. A secondary burden of proof on the part of the directly injured party only applies in exceptional cases. However, the preventive purpose of cartel damages limits the equalization of benefits. The passing-on defense would relieve the cartel participants unfairly, especially if the indirectly injured parties themselves had no incentive to pursue their claims. For example, in cases of minor scattered damages – in the present case the mass business of local public transport – the prohibition of unfair relief for the directly injured party can be set aside.

Implications for future court decisions

With its statements, the FCJ continues to remind the lower courts to make a comprehensive overall assessment of the factual circumstances of the case. When assessing the damage, particular attention must be paid to the influence of all market factors and, if necessary, to reliable private expert opinions. The claimant must substantiate the damage, even if far-reaching rules of experience can help him in asserting the claim.

With regard to a passing-on defense, the FCJ puts a limit on the damage-excluding equalization of benefits, at least in the case of scattered damages, in the interest of the effectiveness of law enforcement. The cartel participant’s passing-on defense will only be successful if indirectly injured parties could at least pursue their claims and have sufficient incentives to do so.

(19 January 2021)