April 18, 2014

Firm obtains significant victory for France-based multinational telecom company Orange in competition dispute with Cowes (formerly Subiteo).

The Commercial Chamber of the French Supreme Court recently reversed a December 2012 decision of the Paris Court in the dispute between Cowes, formerly known as Subiteo, and Willkie client Orange, the French multinational telecommunications company. The annulment reiterates that a prior finding of infringement by the French competition authority does not, as such, establish wrongdoing in follow-on actions.

In 2009, Subiteo brought a claim for damages against Orange, arguing that the latter had abused its dominant position by refusing to grant access to its network, ultimately causing Subiteo to withdraw from the market as early as 2001.

In the first instance, presiding judges dismissed in its entirety the action brought by Subiteo. However, on December 21, 2012, the Paris Court of Appeal considered that Subiteo had been the victim of Orange’s abusive practices and ordered Orange to pay €7 million to Subiteo in damages. In reaching its decision to qualify the fault attributable to Orange, the Court of Appeal simply relied on the fact that Orange’s commercial policy had been the object of several Competition Council and telecom regulator decisions rendered between July 1999 and November 2005, without clarifying how Orange’s behavior may have prejudiced Subiteo in any way.

The French Supreme Court quashed this decision, finding that the Court of Appeal did not "measure up the specific facts from which it deduced the existence of fault attributable to Orange." In other words, the French Supreme Court reaffirmed that a claimant in France needs to establish that the defendant has infringed upon the relevant competition law provisions to recover damages and cannot rely solely on previous decisions from the competition watchdog (which, in any case, were unrelated to the case at hand).

The matter was handled by partner Jacques-Philippe Gunther, national partner Adrien Giraud and associate Nicolas Cassauba.

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