The Competition and Markets Authority v Concordia International RX (UK) Ltd
| Jurisdiction | England & Wales |
| Judge | Mr Justice Marcus Smith |
| Judgment Date | 16 January 2019 |
| Neutral Citation | [2019] EWHC 47 (Ch) |
| Docket Number | Claim No: CP-2017-000009 |
| Court | Chancery Division |
| Date | 16 January 2019 |
[2019] EWHC 47 (Ch)
IN THE HIGH COURT OF JUSTICE
BUSINESS AND PROPERTY COURTS OF ENGLAND AND WALES
COMPETITION LIST (ChD)
Rolls Building
7 Rolls Building
Fetter Lane
London EC4A 1NL
THE HONOURABLE Mr Justice Marcus Smith
Claim No: CP-2017-000009
Mr Jason Beer, QC, Mr Rob Williams and Ms Charlotte Ventham (instructed by The Competition and Markets Authority) for the Claimant
Mr Mark Brealey, QC (instructed by Morgan, Lewis and Bockius UK LLP) for the Defendant
Hearing date: 19 December 2018
Approved Judgment (Open)
I direct that pursuant to CPR PD 39A para 6.1 no official shorthand note shall be taken of this Judgment and that copies of this version as handed down may be treated as authentic.
A. INTRODUCTION
. On 5 October 2017, the Competition and Markets Authority (“CMA”) applied to Mann J for warrants under section 28 of the Competition Act 1998 against, amongst others, the Defendant, Concordia International Rx (UK) Limited (“Concordia”). The application was made by the CMA without notice and in private: this is the default procedure laid down in a practice direction (the “Practice Direction”) that in part governs the making of such applications.
. The application was supported by certain confidential material. This is entirely usual in such applications. After hearing submissions from the CMA, and considering the evidence, Mann J granted various section 28 warrants, including a warrant against Concordia (the “Warrant”).
. The Warrant applied to documents relating to an investigation into suspected anticompetitive behaviours in relation to a number of pharmaceutical drugs (described in the Warrant as “relevant products”). The relevant products – set out in Annex A to the Warrant – included:
(1) Carbimazole 5mg and 20mg tablets (“Carbimazole”); and
(2) Hydrocortisone 10mg tablets (“Hydrocortisone”).
. By an application notice dated 10 October 2017, Concordia applied to have the Warrant discharged to the extent that it applied to Carbimazole and Hydrocortisone. Concordia does not seek to have the Warrant discharged in relation to any other relevant products.
. This Judgment determines that application. It does so pursuant to a process described in my judgment of 12 December 2018 ( [2018] EWHC 3448 (Ch)), whereby I have taken into account in a “closed material procedure” certain material, protected by public interest immunity (“PII” and “PII Material”), that was before Mann J on the ex parte hearing in October 2017.
. Although the use of a “closed material procedure” in cases such as this has been the subject of detailed consideration both in these proceedings 1 and in the Supreme Court, 2 other aspects of the procedure whereby section 28 warrants are to be challenged has received only incidental consideration. Before considering the substance of Concordia's application, it is necessary to consider what that procedure entails.
B. THE PROCEDURE FOR DISCHARGING OR VARYING A WARRANT
. Where a warrant is granted, the Practice Direction provides for a process whereby the warrant may be varied or discharged:
“ Application to vary or discharge warrant
9.1 The occupier or person in charge of premises in relation to which a warrant has been issued may apply to vary or discharge the warrant.
9.2 An application under paragraph 9.1 to stop a warrant from being executed must be made immediately upon the warrant being served.
9.3 A person applying to vary or discharge a warrant must first inform the named officer that he is making the application.
9.4 The application should be made to the judge who issued the warrant, or, if he is not available, to another High Court Judge.”
. Neither the Competition Act 1998 nor the Practice Direction gives any guidance or lays down any procedure for the hearing of applications to vary or discharge a warrant granted pursuant to section 28. As I noted in paragraph 6 above, although the “closed material procedure” has been considered in the courts, other aspects of the procedure whereby a warrant may be challenged have only been considered incidentally.
. Whilst the question of whether a “closed material procedure” could be used remained at large, the CMA's position was that a section 28 warrant granted to the CMA remained valid until quashed. The CMA contended that if there was no “closed material procedure” available in these cases, then the CMA must be presumed to have acted lawfully in executing the warrant unless and until the party the subject of the warrant could provide reasons to the contrary. In this way, the granting of the warrant could be reviewed – albeit in a limited way – without disclosing the PII Material that was deployed on the ex parte application for the warrant.
. This approach – deriving from a series of cases beginning with Inland Revenue Commissioners v. Rossminster Ltd 3 – was considered by the Supreme Court in Haralambous at [48]:
“The approach taken in Rossminster was therefore (i) to treat the onus as being on the applicant for judicial review to establish that the warrant should be quashed and (ii) to treat the applicant as unable to satisfy this onus, in circumstances where the original decision-maker had access to material withheld on public interest grounds from the person affected seeking judicial review; (iii) this result followed from the application of the maxim omnia praesumuntur rite esse acta.”
. The Supreme Court considered the Rossminster approach to be unattractive “in that it is in some circumstances capable of depriving judicial review of any real teeth”. 4 The Supreme Court considered that it was undesirable to create a mismatch between the material before the judge considering whether a warrant should be granted ex parte and the material before the judge reviewing that decision. 5 The Supreme Court ensured that there was no such mismatch, even in a case involving PII Material, by holding that any review of the granting of a warrant, where that warrant had originally been granted after
. I considered – albeit for a different purpose 7 – the nature of the application to vary or discharge a section 28 warrant in my earlier judgment in these proceedings. There, I drew an analogy with the return date for injunctions obtained ex parte. 8 In its written submissions to me, Concordia contended that the analysis contained in my earlier judgment was correct. In its written submissions, the CMA drew a limited analogy to the the process whereby an order permitting service out of the jurisdiction is challenged. 9 In light of the decisions of the Court of Appeal and the Supreme Court, it seems to me that the process whereby an order permitting service out of the jurisdiction is challenged constitutes a good starting point for an analysis of the present jurisdiction more generally. That is the starting point that I propose to adopt. But, I stress, it is only that – a starting point, which must be adjusted in light of the specific process before me.
. The process whereby an order permitting service out of the jurisdiction can be challenged was considered in Microsoft Mobile Oy Ltd v. Sony Europe Limited: 10
91. If a party served pursuant to such an order is minded to challenge it, this will be done on the inter partes return date of the applicant's original ex parte application for permission to serve out of the jurisdiction. At this point, the court will reconsider, and decide de novo, by way of rehearing, whether permission to serve out should be given. It is for the party seeking to serve out – Microsoft Mobile – to demonstrate that this is a proper case for service out. The position is clearly explained in Briggs, Civil Jurisdiction and Judgments, 6th ed. (2015) (hereafter “Briggs”) at p.460:
“The application is made without the opponent's being notified that it is being made; the court will almost always grant permission unless there is a very obvious flaw in the application. If permission is granted, as in practice it almost always is, and service is effected in accordance with it, the defendant may dispute the jurisdiction by challenging the order which granted permission, and the service which was made pursuant to it, by applying under CPR Part 11. The inter partes procedure which then follows marks the point in the process at which the court will investigate whether permission to serve should have been granted. The fact that permission was granted to the claimant in the first place is largely irrelevant at this point: it leaves no footprint; no onus is placed upon the defendant who applies to have the permission set aside; the application is in effect a rehearing of an application for permission, with the onus lying on the party who needed the permission in the first place. The court is not inhibited from discharging or varying the order, and for which the claimant now in substance (if not in form) reapplies, by reason of the fact that it has already been made.”
92. However, the question on the re-hearing is whether it was proper to grant permission on the date upon which the order to serve out was granted, not (in the light of changed circumstances or fresh evidence) whether it would be right to grant it as at the time of
the inter partes application. In ISC Technologies Ltd v. Guerin [1992] 2 Lloyd's Rep. 430 at 434, Hoffmann J. stated:“Mr. Crystal said I should look at the position today. An application under R.S.C. O.12, r.8 is a rehearing of the application to the Master and the exercise of a fresh discretion. It should therefore take into account whatever has since happened. I do not agree. The application is under R.S.C. O.12, r.8(1)(c) to discharge the Master's order...
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Hydrocortisone tablets: alleged excessive and unfair pricing, anti-competitive agreements and abusive conduct (50277)
...other evidence the CMA obtained that 31 The Competition And Markets Authority v Concordia International Rx (UK) Ltd, [2019] WLR(D) 20, [2019] Bus LR 1000, [2019] EWHC 47 (Ch) (16 January 2019) (see www.bailii.org/ew/cases/EWHC/Ch/2019/47.html) (see paragraphs 33 and Page 34 of 1077 represen......
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United Kingdom
...of any document that is a privileged communication. 225. The Competition And Markets Authority v. Concordia International Rx (UK) Ltd. [2019] EWHC 47 (Ch) (16 Jan. 2019). United Kingdom-51 Act. A warrant is required whenever the CMA wishes to enter domestic premises in relation to an invest......