CDC’s activities in relation to the German cement cartels have attracted considerable attention both in Germany and internationally. CDC subsequently brought two lawsuits in Germany concerning damage claims acquired by more than 35 companies harmed by the cartel. The first action for damages was filed in 2005 before the Regional Court of Düsseldorf, and the second one in 2015 before the Regional Court of Mannheim.
In 2002, the German Federal Cartel Office (FCO) initiated investigations in the cement industry due to suspected cartel activities. Subsequently, several cement producers, starting with Readymix AG, applied for leniency. They confirmed that, together with other cement producers, they had entered into illegal quota and market-sharing agreements throughout Germany since the beginning of the 1990s at the latest.
In April 2003, the FCO imposed fines totalling EUR 702 million on twelve companies and their representatives for their participation in the German cement cartels, EUR 660 million thereof on the six largest German Producers:
- Alsen AG (now Holcim Deutschland AG)
- Dyckerhoff AG (now Dyckerhoff GmbH)
- HeidelbergCement AG
- Lafarge Zement GmbH
- Readymix AG (now Cemex Deutschland AG)
- Schwenk Zement KG
In June 2009, the Higher Regional Court of Düsseldorf confirmed the findings on the competition law infringements (Case VI-2a Kart 2-6/08 OWi). However, it lowered the fines imposed to EUR 330 million because of incomplete data for setting the fines. The Court confirmed that the cartel agreements resulted in illegal profits.
In February 2013, the German Federal Court of Justice ultimately confirmed the findings of the Higher Regional Court and rebutted the subsequent appeals brought by some cartel members (Case KRB 20/12).
The courts concluded that the cartel agreements covered the whole territory of Germany. These arrangements had been triggered by a meeting of the cement producers represented in the Presidium of the Federal Association of the German Cement Industry in March 1990. Though, the courts did not find one German-wide cartel, but rather separate cement cartels in four sales regions in Germany which constituted different regional markets.
Previously, the European Commission had already confirmed the finding of Europe-wide cement cartel on 30 November 1994 (Case IV/33.126 and 33.322). This cartel included the protection of ‘home markets’ and the traditional pattern of cement trade in Europe. Dyckerhoff, HeidelbergCement, Lafarge and Alsen among others were found to have participated in this cartel. The Commission imposed record fines and the European Courts confirmed this decision on the merits (judgment of 15/03/2000 Cimenteries et al. and judgment of 07/01/2004 Aalborg Portland).
Lafarge, Cemex, HeidelbergCement and Dyckerhoff, respectively affiliated companies, have been found to have also participated in a Polish Cement Cartel. In 2013, a Polish court confirmed the finding of the Polish competition authority that the cement companies operated a cartel in Poland from the 1990s to 2009. According to the competition authority, one of the aims of the cartel was the prevention of exports to Germany.
Further information on the German cement cartels:
- German FCO, Activity Report 2001-2002, p. 147 (DE)
- German FCO, press release dated 14/04/2003 (EN)
- German FCO, Activity Report 2003/04, p. 110 (DE)
- Higher Regional Court of Düsseldorf, judgment of 26/06/2009 (VI-2a Kart 2-6/08 OWi) (DE), together with accompanying press release of 29/06/2009 (DE)
- Press release of the German Federal Court of Justice in relation to its decision of 26/02/2013 (KRB 20/12) (DE)
- European Commission, decision of 30/11/1994 (Cases IV/33.126 and 33.322) (EN)
- European Court of First Instance, judgment of 15/03/2000 (ECLI:EU:T:2000:77) (EN)
- European Court of Justice, judgment of 07/01/2004 (ECLI:EU:C:2004:6 Aalborg Portland) (EN)
- Polish competition authority, press releases of 10/12/2009 (EN) and 31/12/2013 (EN)
In August 2005, after a comprehensive analysis of the damages caused, CDC filed a first damage action against three (later six) members of the German cement cartels before the Regional Court of Düsseldorf (Case 34 O (Kart) 147/05). The action was extended twice in order to include additional claims purchased by CDC from further companies. The damages claimed amounted to approximately EUR 176 million plus interest.
The claim was based on the findings in the administrative proceedings and relevant data collected from numerous damaged companies. This included nearly 300,000 documents on purchase transactions (e.g. invoices and credit notes). CDC’s analysis showed clear price effects of the cement cartels. A parallel external research conducted by the Centre for European Economic Research (ZEW Zentrum für Europäische Wirtschaftsforschung) in Mannheim, Germany, found that the cartels implemented price increases of 20.3 % to 26.5 %.
Applications of the defendants to obtain a suspension of the damage proceedings until the end of their appeals against the fining decision of the FCO were rejected by both the Regional Court (decision of 09/03/2006, Case 34 O (Kart) 147/05) and the Higher Regional Court of Düsseldorf (decision of 03/05/2006, Case VI-W (Kart) 6/06).
With judgment of 21 February 2007, the Regional Court of Düsseldorf confirmed the admissibility of the action. The Higher Regional Court of Düsseldorf upheld this decision without allowing further appeal (decision of 14/05/2008, Case VI U (Kart) 14/07). Dyckerhoff contested the latter decision nonetheless, but the Federal Court of Justice rejected this attempt on 7 April 2009 (Case KZR 42/08) finally confirming that the action was admissible.
The Regional Court of Düsseldorf continued proceedings almost three years later. It finally dismissed the action on 17 December 2013 (Case 37 O 200/09) basing its decision essentially on the alleged invalidity of the assignments of claims by the damaged companies to CDC. Further, it held that the limitation period had already commenced in 2003, as victims of the cartels would have had sufficient knowledge of the facts in order to file an action in a reasonable way due to media coverage on the decisions of the FCO. By contrast, in the administrative proceedings, the Düsseldorf Higher Regional Court heard about 40 witnesses on 36 days of the trial since 11 December 2008 in order to shed light upon the facts.
CDC’s appeal against the judgment was dismissed by the Higher Regional Court of Düsseldorf by judgment of 18 February 2015 (Case VI-U (Kart) 3/14). The Court shared the view that the assignments were invalid; it further heavily relied on procedural arguments. For details on both judgments please see our press releases dated 19 December 2013 and 25 February 2015.
The main reason for declaring the assignments invalid was an alleged collusive shift of the cost risk from the damaged companies to CDC which allegedly did not have the financial capacity to bear the adverse costs. In 2005, in contrast, the Düsseldorf Regional Court ruling on the value in dispute had assumed that CDC’s economic situation would not be seriously jeopardised if CDC had to bear the costs of litigation in the event of losing the case. In fact, CDC has made advance payments of court fees totalling more than EUR 713,000 at the end of the day. Furthermore, CDC has made full cost reimbursements to all opposing parties after its action and the appeal were dismissed, totalling more than EUR 3.5 million. Thus, all costs have been paid.
The Higher Regional Court of Düsseldorf has not admitted a further appeal against its appeal judgment of 18 February 2015. It therefore has become final.
Further information on cement cartels proceedings initiated in 2005:
- Regional Court of Düsseldorf, decision of 27/09/2005 (34 O (KART) 147/05) on the adjustment of the value in dispute (DE)
- Regional Court of Düsseldorf, decision of 09/03/2006 (34 O (Kart) 147/05) (DE), and Higher Regional Court of Düsseldorf, decision of 03/05/2006 (VI-W (Kart) 6/06) (DE) on suspension of proceedings
- Higher Regional Court of Düsseldorf, decision of 14/05/2008 on the admissibility of the action, together with the accompanying press release (DE)
- Federal Court of Justice, decision of 07/04/2009 (KZR 42/08) (DE) on the admissibility of the action, together with the accompanying press release of 17/04/2009 (DE)
- Regional Court of Düsseldorf, judgment of 17/12/2013 (37 O 200/09 (Kart)) (DE) dismissing the action, together with CDC’s accompanying press release of 19/12/2013 (EN)
- CDC’s application to the Regional Court of Düsseldorf for correction of facts in the judgment, dated 27/12/2013 (DE), together with the Court’s decision of 14/04/2014 (37 O 200/09 [Kart]) (DE)
- Higher Regional Court of Düsseldorf, appeal judgment of 18/02/2015 (VI-U (Kart) 3/14) (DE), together with CDC’s accompanying press release of 25/02/2015 (EN)
- CDC’s application to the Higher Regional Court of Düsseldorf for correction of facts in the appeal judgment, dated 12/03/2015 (DE), together with the relevant chapter titled ‘Streitwertanpassung’ (adjustment of the value in dispute) of CDC’s statement of claim dated 5 August 2005 (DE), and the following decision of the Higher Regional Court of Düsseldorf dated 30/03/2015 (VI-U (Kart) 3/14) (DE)
- Higher Regional Court of Düsseldorf, decision of 18/02/2015 (VI-W (Kart) 1/15) on the value in dispute for third-party interveners as regards the main proceedings in first instance (DE)
- Higher Regional Court of Düsseldorf, decision of 30/03/2015 (VI-U (Kart) 3/14) on the value in dispute for third-party interveners as regards the main proceedings in second instance (DE)
On 16 September 2015, CDC filed a second damage action relating to the German cement cartels before the Regional Court of Mannheim against HeidelbergCement. With this action, CDC claims more than EUR 110 million in damages resulting from cartel agreements in the South and East of Germany (Case 2 O 195/15).
The new action strictly follows the binding findings in the administrative antitrust proceedings as ultimately confirmed by the Federal Court of Justice in 2013. Accordingly, HeidelbergCement participated in illegal agreements on market-sharing and sales quotas regarding the South and East of Germany from the beginning of the 1990s until, at least, spring 2002.
CDC’s new action concerns cartel damages of 23 mostly medium-sized cement purchasers which have assigned their claims to CDC. Against the background of the judgment of the Higher Regional Court Düsseldorf of 18 February 2015, CDC has taken measures to secure adverse legal costs for three instances. CDC has provided a precautionary security of more than EUR 2.3 million to the benefit of the defendant and the state.
Bringing the new action shows the dedication and persistence of CDC when it comes to the enforcement of antitrust damage claims.
On 24 January 2017, the Regional Court of Mannheim confirmed that the new action is admissible. In particular, it is not excluded by the previous judgments on CDC’s first action in the cement case in Düsseldorf. However, on the merits, the Mannheim Court rejected the claim in its entirety as time barred. The Court thereby followed its appeal court, the Higher Regional Court of Karlsruhe, which had decided in a judgment of 9 November 2016 in a parallel case that a specific statutory provision suspending limitation periods in antitrust damages cases was not applicable to claims which arose prior to the entry into force of that provision. In this regard, the Higher Regional Court of Karlsruhe followed a minority opinion. It diverges from judgments of several other Higher Regional Courts, as well as from many recent first instance judgments, throughout Germany.
CDC has thus filed an appeal against the judgment of the Regional Court of Mannheim. The Higher Regional Court of Karlsruhe will now reconsider its legal position. It is likely that this key issue for private enforcement in Germany will ultimately have to be decided upon by the Federal Court of Justice.
Further information on cement cartels proceedings initiated in 2015:
CDC Consulting SCRL
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