Veranova Bidco LP v Johnson Matthey Plc & Ors
| Court | Queen's Bench Division (Commercial Court) |
| Judge | Sean O’Sullivan KC |
| Neutral Citation | [2025] EWHC 707 (Comm) |
| Date | 25 March 2025 |
| Year | 2025 |
| Counsel | Tony Singla Kc,Michael Bolding,Jessie Ingle,Simon Rainey Kc,David Caplan,Ruihan Liu |
Neutral Citation Number: [2025] EWHC 707 (Comm)
Case No: CL-2023-000277
IN THE HIGH COURT OF JUSTICE
BUSINESS AND PROPERTY COURTS OF ENGLAND AND WALES
KING'S BENCH DIVISION
COMMERCIAL COURT
Royal Courts of Justice, Rolls Building
Fetter Lane, London, EC4A 1NL
Date: 25/03/2025
Before :
Sean O’Sullivan KC (sitting as a Deputy Judge of the High Court)
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Between :
VERANOVA BIDCO LP Claimant
- and -
(1) JOHNSON MATTHEY PLC
(2) JOHNSON MATTHEY INVESTMENTS
LIMITED
(3) JOHNSON MATTHEY INCORPORATED Defendants
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TONY SINGLA KC, MICHAEL BOLDING and JESSIE INGLE
(instructed by Linklaters LLP) for the Claimant
SIMON RAINEY KC, DAVID CAPLAN and RUIHAN LIU
(instructed by Herbert Smith Freehill LLP) for the Defendants
Hearing dates: 14 March 2025
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Approved Judgment
This judgment was handed down remotely at 10.30am on 25 March 2025 by circulation to the
parties or their representatives by e-mail and by release to the National Archives.
.............................
Sean O’Sullivan KC
Approved Judgment
V B v J M
Sean O’Sullivan KC (sitting as a Deputy High Court Judge):
1. On 14 March 2025, I heard an application by the Defendants (“the Ds”) for summary
judgment/ strike out in respect of one element of the Claimant (“C”)’s claim. At the
end of the hearing, I refused the application and indicated that my written reasons
would follow. This judgment sets out those reasons.
The background
2. The background is that, on 16 December 2021, the parties entered into a number of
contractual documents pursuant to which the Ds sold a particular business (“the
Health Business”) to C. One of these contractual documents was a share purchase
agreement (“the SPA”). Another was a disclosure letter (“the Disclosure Letter”).
Completion took place on 31 May 2022.
3. C’s core complaint is that it was not told, prior to the transaction, that one of the
Health Business’s most important customers, Alvogen Incorporated (“Alvogen”), had
triggered a price review mechanism in its contract with the Health Business in relation
to a particular pharmaceutical product, Buprenorphine HCl (“BHCL”).
4. As to that, it appears to be common ground that the supply agreement with Alvogen
required Alvogen to purchase a minimum of 75% of its annual requirements for active
pharmaceutical ingredients from the Health Business. That agreement contained a
price adjustment mechanism whereby, upon notification by Alvogen of a bona fide
offer from a third-party manufacturer to supply BHCL at a lower price, Alvogen
would be entitled to purchase from that alternative supplier if the Health Business
failed to match the competing offer.
5. While the negotiations for the SPA were ongoing, the Health Business was notified by
Alvogen of a competing offer from a third party that was very significantly below the
existing BHCL price the Health Business charged to Alvogen. This competing offer
was verified by the Health Business as bona fide on 10 December 2021 (i.e. six days
before the SPA was signed).
6. C contends that, by at least that date, the Ds were well aware that they would need to
match the competing offer in order to retain Alvogen’s business, resulting in a price
reduction that would have a very serious consequential impact on the value of the
Health Business.
7. On 20 December 2021, two working days after the SPA was signed, the Third
Defendant offered to supply BHCL to Alvogen at a price only very slightly above the
competing offer. Then, on 22 December 2021, the Third Defendant agreed with
Alvogen to match the competing offer.
8. C says that it was not told about the triggering of the clause by Alvogen or the price
which the third party had offered, and hence that it was misled about the price at
which the Health Business was expecting to sell BHCL going forwards.
9. That core complaint gives rise to two different, if overlapping, types of claim. The
first is for breach of two warranties given in the SPA. One aspect of this complaint is
that disclosures made in the Disclosure Letter are said to have been insufficient
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