On November 29, 2022, the German Federal Court of Justice (“FCJ”) overturned a decision by the Frankfurt am Main Court of Appeal dismissing a damages action by the insolvent drugstore chain Schlecker. The FCJ held that, in the case of an anticompetitive exchange of price-related information, there is a factual presumption of causal damage. The matter has been sent back to the Frankfurt am Main Court of Appeal for a new decision because, in the opinion of the FCJ, it had attached too light weight to a factual presumption.
Schlecker’s insolvency administrator, Arndt Geiwitz, claimed € 212 million in damages (plus interest) from several drugstore product manufacturers involved in an anti-competitive information exchange on personal care products, detergents, and cleaners fined by the German Federal Cartel Office concerning. Like the first instance court, the Frankfurt am Main Court of Appeal dismissed the claim, but on different grounds: Geiwitz had not sufficiently proven that Schlecker had suffered damages as a result of the information exchange. In doing so, the court had left open the question of whether a factual presumption of harm could apply, as such a presumption would carry only little weight due to numerous indications that the information exchange did not have a price-increasing effect.
The FCJ overturned the appeal ruling and referred the case back to the Frankfurt am Main Court of Appeal. First, it confirmed—in agreement with the Frankfurt am Main Court of Appeal’s ruling—its standing case law that the binding effect of the fine decision does not extend to the question of causal harm. It recognized that a mere exchange of information—unlike an agreement to behave on the market in a certain way—may even have positive effects, i.e., transparency can result in efficiency gains.
According to the FCJ, the anticompetitive exchange between competitors of secret information concerning current or planned price-setting behavior vis-à-vis a common buyer, on the other hand, creates a factual presumption that the buyer has suffered harm. The ruling significantly expands the scope of empirical evidence of cartel damages, which previously only applied to hardcore cartels (i.e., price-fixing, customer protection, and quota protection cartels).
At the same time, the FCJ clarified that the factual presumption is only indicative and does not constitute prima facie evidence nor does it reverse the burden of proof. Therefore, the court must still weigh all circumstantial evidence in an overall assessment as to whether it confirms or invalidates the factual presumption in the specific case. For example, the FCJ pointed out that while a long duration of an infringement of competition law is a strong indicator of an effect, a short duration of the information exchange does not indicate that no harm was caused. However, the lack of cartel discipline and an improvement in the buyer’s conditions during the period of information exchange compared to the periods before and after can indicate that the violation had no effect.
 For more information on the decision, please see our Antitrust Watch blog article available here. Frankfurt am Main Court of Appeals decision (11 U 98/18) of May 12, 2020, only available in German here. See the Press Release, May 20, 2020, only available in German here.
 Most recently Truck Cartel (KRZ 35/19), FCJ decision of September 23, 2020, only available in German here. For more information on the decision, please see our Antitrust Watch blog article available here. See also Lottoblock II (KZR 25/14), FCJ decision of July 12, 2016, only available in German here.