IF YOU THINK THE WHEELS OF JUSTICE CAN GRIND SLOWLY: TRY THE EU! IMPORTANT DECISION ON DISCLOSURE, CONFIDENTIALITY, REDACTION AND THE POWER OF THE COURT TO REVIEW ITS EARLIER ORDERS

October 28, 2014 · by · in Applications, Civil evidence, Civil Procedure, Disclosure

A decision by Peter Smith J in Emerald Supplies Ltd -v- British Airways PLC was considered in the previous post. However another issue arose in the same case which is at [2014] EWHC 3513 (Ch). The application was of an unusual kind, however it contains some interesting, and trenchant, observations. In particular in relation to co-operation from the EC; the use of judicial assistants and the power of the court to review its earlier decisions.

THE APPLICATION

The application was to review the appropriateness/lawfulness of the redactions made by the defendant (and other) airlines to an EC decision. The judge had earlier made an order that an “edited” version of that decision be disclosed.

  1. In the event the document that was produced pursuant to that exercise was and is completely useless because so much has been redacted. That has led to the present application (it looks like the kind of redactions seen in some FOI cases)

THE FIRST TRENCHANT OBSERVATION

  1. Nevertheless it must be appreciated that the necessity for the application arises solely from the one speed molasses like approach of the EC in relation to its determinations. It is a matter of great concern to me that this action has been stymied for many years because of the EC’s failure to proceed with anything like reasonable time for making its decisions. Further it is a matter of even greater concern that despite the fact that there have been considerable delays the EC in communications with me have indicated that there is no procedure whereby the matter can at least be expedited in an attempt to overcome the delays which have occurred or any attempt to address the situation.

THE NEXT SET OF TRENCHANT OBSERVATIONS

PROCEDURAL HISTORY

  1. On 10th February 2014 the Claimants issued an application to inspect the Commission’s Decision together with a separate application for there to be a trial of various preliminary issues. That application was supported by the first witness statement of Boris Bronfentrinker as solicitor and partner in the firm of Hausfeld & Co LLP (“Hausfeld”). As set out in that witness statement the Commission Decision was issued on 9th November 2010 with a press release on the same day confirming it had fined 11 Air Carriers including BA for operating a worldwide Cartel. BA as an addressee of the Decision has a copy of it in its possession. The Claimants have not seen the Decision in its entirety.
  2. Despite the Decision having been issued merely (sic) 4 years ago the Commission has been unable to agree what part or parts of the Decision should be made public. There are obviously a large number of airlines affected in addition to BA. Some are apparently identified in the Decision and allegations or findings are made against them. Others are identified but no findings are made against them. These two categories feature as Part 20 Defendants to a claim brought by BA. Thus some of them have seen the Decision and are in the process of making representations about the wording of the published version. Others have not even seen the Decision, like the Claimants.

EARLIER DELAYS

  1. The Claimants sought a copy of the Decision suitably redacted to address legitimate confidentiality concerns in April 2012. In May 2012 BA refused to provide any. Accordingly the Claimants’ solicitors wrote to the Commission explaining the delay and in its response the Commission stated the following reason by the hearing officer “it will proceed as soon as possible to publish at least a provisional non confidential version of the Decision”. After further correspondence in June 2012 the Commission stated that they hoped it would be possible in the coming weeks to publish a meaningful Provisional Decision, but nothing has happened.
  2. Following the hearing before me on 28th March 2014 the Commission (at the instigation of one of the parties in this action) wrote to me on 23rd April 2014.
  3. Although the letter was addressed to me it was apparently sent to one of the parties to the litigation. The worrying paragraph is the second paragraph which says as follows:-

“The Commission understands the Court’s concern at the delay in publishing a non-confidential version of the Decision. Under the present state of European Union law however, it is not possible for the Commission, within a reasonable timeframe, to override the numerous confidentiality claims made by addressees of the Decision, which prevent publication of a meaningful non-confidential version of the Decision. In this respect, I would refer you to an interim order made by the General Court in Case T-462/12 R, Pilkington Group Ltd v Commission and, on appeal, by the Court of Justice in Case C-278/13 p(R), Commission v Pilkington Group Ltd. The Court of Justice upheld an order made at first instance by the General Court restraining the Commission from publishing a non-confidential version of another cartel decision, the European Courts accepting the applicant’s argument that the publication of material over which confidentiality was claimed could cause irreparable harm to the applicant. The determination of whether the material in question is indeed deserving of protection as confidential is a matter that will only be decided in the final judgment.l In the light of the position taken by the Court in Pilkington, the Commission finds it is unable to publish a non-confidential version of the Decision, given the widespread objections to publication on grounds of confidentiality: the addressees would be able to rely on Pilkington to obtain interim measures from the European Courts preventing publication of a non-confidential version of the Decision. The further implication of the Commission’s inability to override the addressees’ confidentiality claims is that the Commission is unable to explain to the non-addressees the exact context in which they are mentioned in the Decision. The Commission is therefore not in a position to provide the non-addressees with the information necessary for them to make a substantiated application to your Court of the sort that appears to be contemplated by paragraph 8(2)(i) of your Order. The Commission has only been able to confirm, either in writing or orally and without any reference to any paragraphs of the Decision, that the non-addressees are mentioned in the factual part of the Decision. The Commission hopes therefore that you will understand that any applications made pursuant to paragraph 8(2)(i) of your Order by non-addressees of the Decision cannot be substantiated further than a request that any reference to the non-addressee making the application be removed from the Redacted Decision to be prepared pursuant to paragraph 10 of your Order. “

  1. Further the Commission gave no assistance and ultimately as appears from a later extract left how the Decision should be dealt with to me:-

“As the Commission has confirmed to non-addressees that it intends to redact the names of third parties from the non-confidential version that will ultimately be published, and as it appears that the steps set out in your Order are intended to substitute for the absence at present of a published non-confidential version of the Decision, the Commission would respectfully suggest that it may be unnecessary for non-addressees to make applications pursuant to paragraph 8(2)(i) of your Order. In the light of Pergan, the Court could simply order that the Defendant’s solicitors remove the names of any third parties from the Redacted Decision that they are to prepare pursuant to paragraph 10 of your Order. This would also save costs and deal with the concern expressed to the Commission by some non-addressees that, by making an application pursuant to paragraph 8(2)(i) of your Order, they will thereby reveal their identity, and thus undermine the very purpose of the application pursuant to paragraph 8(2)(i). “

  1. Although the letter was sent in the “spirit of co-operation” between the national courts and the EC there does not with respect to the Commission seem to be much co-operation from it. Despite the fact that it must be self-evident that 4 years even just to consider working out the non confidential part of the Decision is completely unacceptable no steps are being made to speed up that process and no indication is given as to when the whole process will be finalised.
  2. As I said in reply to their letter the spirit of co-operation must be a mutual thing but it does not with respect appear to be very mutual. I do not think it is acceptable for these kinds of delays to be imposed on the Courts within this jurisdiction. The events go back some 17 years and I was told at the hearing in March 2014 that it was possible that matters would not be finished within the European system until 2020. These proceedings are already stale as they are already nearly 6 years old and they have not moved beyond close of pleadings. There has been no disclosure, no exchange of witness statements and as will appear below there are apparently restraints on this jurisdiction in the “spirit of co-operation” in coming to decisions which might be at variance with the decisions that the Commission make.
  3. Of course there are well established procedures within these courts to protect people’s confidentiality. I have come to the conclusion as I shall set out below that together with restrictions on the Claimants’ ability to bring proceedings against anybody other than those already in the Part 20 proceedings without permission of the court provide a more than ample protection of the so-called confidential issues in the Decision.

THE NEXT TRENCHANT POINT: THE PARTIES WERE ENTITLED TO A REVIEW OF THE JUDGE’S EARLIER DECISION

The judge had made an earlier decision in relation to redaction.  He felt it was possible for the parties to apply for him to review that decision.

  1. accept that the hearing on 27th and 28th March 2014 on the question of whether the addressees could invoke Pergan at that time I decided it against the Claimants. I offered them the opportunity for a reasoned decision but neither they nor any of the other parties then sought one. As a consequence of that order the parties attempted a regime whereby all parties potentially interested in this process could make redactions that they required under the 3 headings of Leniency, Pergan and Legal Professional Privilege and present the Claimants with the Decision thus redacted. The procedure was a farce.
  2. In my view given the abject failure of the procedure the Claimants were entitled to seek a review of my decision of 27th and 28th March 2014. Under powers I have under the overriding objective under CPR 3 I also have a power to vary or revoke an order under CPR 3.1 (7). The failure of the process of redaction is sufficient reason to invoke that power. However I do not accept that CPR 3.1 (7) needs a material change of circumstances or a statement of facts. It requires an exceptional factor for the Court to vary or revoke an existing order so as to ensure that the procedure is not abused. Thus the Court should be alert to ensure that it is not an attempt to a backdoor appeal. The Court should equally be astute to see that repeated applications to review orders are not made. It is the exception not the rule. The circumstances of the failure of the redaction process or rather its inadequacy justified revisiting that decision.
  3. I reviewed all of these authorities in ITS v Noble [2010] EWHC 3275 at paragraphs 90-101 and concluded (as the wording of the paragraph makes clear) the Court has a power for review of an existing order (although it should hardly ever happen but it can happen). Nothing in Tibbles leads me to any different conclusion now.
  4. The Claimants have persuaded me in the light of that failed redaction process that I should revisit that decision.
  5. There is nothing in the case of Tibbles v SIG Plc [2012] 1 WLR 2591 which curtails the ability of the Court in an appropriate case to revoke a previous order. Indeed paragraph 39 of Rix LJ’s judgment in many ways confirms that power but affirms the rarity of a successful invocation of that power. Even in that situation Rix LJ observed that exception is a dangerous and misleading word but affirmed revocation of an order (whether final or otherwise) is something out of the norm. Whilst it might be out of the norm this procedure has existed (for example) in the Insolvency Rules for some considerable time see Mond v Hammond Suddards [2000] Ch 40. It has even extended in my view to final orders see Paragon Finance v Pender [2003] EWHC 2834 paragraph 74.

TRENCHANT OBSERVATION AS TO ASSISTANCE

  1. The Claimants in frustration have issued the present application. It modified the existing one as a result of the debates that took place before me in March 2014.
  2. The Claimants by their application sought to create a regime whereby I would have the doubtful privilege of reading the entirety of the Decision, trying to understand it despite having no detailed knowledge of the background of the case and the issues and then decide which part or parts of the Decision ought to be redacted.
  3. The plain fact is that unlike the various teams that have appeared in front of me with unlimited resources the Judge (in this case myself) has no resource whatsoever. The Claimants’ suggestion was that I should be provided with a legal assistant to give me guidance and help. They suggested somebody who according to his CV has considerable experience in this area. One preliminary difficulty was that in his former career as a solicitor he had instructed me at the Bar but that was over a decade ago and that was not a problem. More significantly he was no longer practising as a solicitor and had been called to the Bar and this summer joined my former chambers.
  4. Unsurprisingly all the other parties objected to this procedure for various reasons. In my view it was a well intentioned proposal and the objections bordered on the ludicrous to the insulting. The idea that I as a Judge would be overborne by a legal assistant and effectively defer the Decision to that legal assistant is ludicrous. Several of the Judges (including myself) have the benefit of legal assistants provided by firms of solicitors over the course of the legal year. Indeed my current legal assistant is employed by one of the firms of solicitors in front of me. No one thought that was objectionable.
  5. I do not see this assistance as a matter of principle would be any different to assessors. He would provide the logistical support which I do not have.
  6. However I have come to the conclusion that the task for me even with assistance is an impossible one and is objectionable. If the parties cannot agree what should be redacted I do not see why I as a Judge should be forced into doing that exercise bereft as I am of detailed information of the background and of the issues to enable me to edit out the Decision.
  7. I therefore decline to contemplate reading the Decision with or without assistance.

THE JUDGE’S DECISION

The judge reviewed the earlier decision that redacted copies should be disclosed, less material known as “leniency material” and privileged material.

  1. In my judgment the confidentiality ring with the restrictions on the Claimants as I have set out above not only addresses all of the concerns expressed by the Court in Pergan but also provides more than adequate protection. In addition of course it enables the present dispute to be pursued by all parties on an equal arms basis i.e. all of them as opposed to some of them have the benefit of the Decision. As the action proceeds the confidentiality can be maintained so that there can be no damage caused by the Decision and whatever it might say about any party to this action going in the public domain and affecting that company’s goodwill.
  2. The parties have accepted the Claimants’ understanding of the leniency regime and I accept that parts of the Decision which could be the subject matter of legal professional privilege should be redacted. If there is a dispute over those then I propose to deal with those. I do not of course need a legal assistant to help me to decide those.
  3. For all of the above reasons it is in my view appropriate to revisit my earlier decision and sever the Gordian knot by ordering the un-redacted Decision, minus leniency material and material for which legal professional privilege is claimed, to be disclosed to all parties subject to the confidentiality ring and subject to the restraint on the Claimants that I have set out above.
  4. When I hand this judgment down I would like the parties to have attempted to agree further directions for the progress of this action. It is essential that the action proceeds with expedition and the“relaxed attitude of the EC to its procedures should not be allowed further to delay these proceedings”.
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