German case law has so far been skeptical of the pursuit of large portfolios of antitrust damages claims under the so-called assignment model. This development now seems to have been stopped and Germany is once again becoming a more attractive forum for antitrust litigation.
Previous development
Many German plaintiffs assert their claims for damages against cartel members under the so-called assignment model (Abtretungsmodell). In this model, a group of consumers or companies assign their claims to a third party (debt collection service provider). This third party then asserts the claims in or out of court on a bundled basis and usually receives a contingency fee. For a long time, the admissibility of this type of collective redress was disputed in Germany, and courts denied the right of debt collection service providers to sue because of alleged violations of the German Legal Services Act (Gesetz über außergerichtliche Rechtsdienstleistungen, RDG). The Federal Court of Justice ruled in favour of the assignment model in two landmark decisions in 2021 (II ZR 84/20) and 2022 (VIa ZR 418/21) but lower instance courts were reluctant to receive these judgments. The main reason given was that the complexity of antitrust law would require special expertise which debt collection service providers typically do not have. The courts referred to corresponding provisions in the RDG, which requires legal service providers to have sufficient expertise in certain core areas of law. However, this development now seems to have been stopped. Both the Higher Regional Court of Munich (OLG München) and the Higher Regional Court of Stuttgart (OLG Stuttgart) follow the view expressed by the Federal Court of Justice and affirmed the legality of the assignment model.
Truck Cartel (Higher Regional Court of Munich)
The earlier judgment of the Regional Court of Munich, which declared the assignment model to be invalid, has been set aside by the Higher Regional Court of Munich (judgment of 28 March 2024 – 29 U 1319/20). Contrary to the Regional Court’s view, the assignment model is considered to be permissible. It is expressly recognized by the Higher Regional Court that a debt collection service provider may very well enforce claims in any area of law, including antitrust law. The action relates to the truck cartel. The European Commission imposed fines totaling almost four billion euros on truck manufacturers DAF, Daimler, Iveco, Scania and Volvo/Renault for price-fixing between 1997 and 2011. MAN was granted immunity from fines for voluntarily disclosing the cartel. In the action, claims for approx. 70,000 trucks are bundled totaling EUR 560 million in damages plus interest. In the first instance, the action had failed because the Regional Court of Munich denied t that the claims has been validly assigned to the debt collection service provider. The court cited alleged violations of the Legal Services Act in its reasoning. On appeal, however, the Higher Regional Court of Munich came to a different conclusion. The Higher Regional Court held that the plaintiff’s actions are permissible under the Legal Services Act and that the claims were validly assigned to the debt collection service provider. The Higher Regional Court rules that the claims are founded and referred the case back to the Regional Court of Munich for quantification of the damages. The defendant has filed an appeal on points of law against the judgment which is now pending in front of the German Federal Court of Justice.
Log cartel (Higher Regional Court of Stuttgart)
In addition, and most recently, the 2nd Civil Senate of the Higher Regional Court of Stuttgart (OLG Stuttgart) also ruled in favour of a claim for damages from the assigned rights of 36 sawmills (judgement of 15 August 2024 – 2 U 30/22). The case concerns 36 sawmills that assigned their cartel damages claims to a legal service provider. The sawmills see themselves as victims of the so-called “log cartel”, which allegedly fixed log prices for itself and other forest owners between 2005 and 2019. Specifically, the lawsuit seeks compensation for damages incurred by the sawmills as a result of purchasing logs at prices allegedly inflated by the cartel. Contrary to the Regional Court of Stuttgart, the Higher Regional Court of Stuttgart denied that the assignment model per se violated the Legal Services Act in the field of antitrust law. The assignment model and the assertion of claims do not constitute an inadmissible debt collection service. This is therefore possible in principle, and the assignments are therefore effective, provided that the assignment is sufficiently proven.
Conclusion
‘Due to the fundamental importance’ of the case, both the Higher Regional Courts of Stuttgart allowed an appeal on points of law to the Federal Court of Justice. However, it is expected that the Federal Court of Justice will adhere to its previous case law and confirm the validity of the assignment model also in antitrust cases, thus paving the way for companies and consumers harmed by cartels to assert antitrust damages claims more broadly and possibly more quickly in Germany. In addition, the German Verbandsklagegesetz, which is based on the Representative Actions Directive (EU) 2020/1828, may also cover antitrust damages claims, as it is also intended to allow small companies to bring collective actions for damages.
Moritz Lorenz & Lars Hettstedt