Freshfields secures significant victory for Infineon in defence of competition damages claim and clarifies rules on limitation in England and Wales

The UK Supreme Court has refused an application for permission to appeal a finding that a near-€500m competition damages claim brought by Gemalto against Infineon and Renesas (following on the European Commission’s Smart Card Chips infringement decision) was time-barred for being filed after expiration of the relevant limitation period.

The Supreme Court’s Order confirms the ruling of the Court of Appeal, in our client Infineon’s favour, that the limitation period for Gemalto to bring its claim began running prior to the European Commission’s infringement decision and that Gemalto was accordingly out of time by the date it filed its claim. 

The result is a resounding success for Infineon, which prevailed on its limitation arguments both at first instance in the High Court and in the Court of Appeal. The case also created new law on the legal test applicable to limitation in cases of deliberate concealment. 

Overview

On 10 June 2022, the UK Court of Appeal handed down an important judgment dismissing claimant Gemalto’s appeal against the ruling that its follow-on claim for competition damages (valued at nearly €500m) was time-barred.

In a unanimous judgment, the Court of Appeal upheld the decision of the High Court that Gemalto brought its claim more than six years after the limitation period began to run under the specific limitation rules postponing the running of time in cases of deliberate concealment. Significantly, both courts held that, on the facts of this case, Gemalto had all the information needed to plead its claim, or to embark on the preliminaries to issuing a claim, from the time the European Commission announced that it had issued a statement of objections in its Smart Card Chips investigation.

On 13 December 2022, the Supreme Court refused Gemalto’s application for permission to appeal the Court of Appeal’s judgment and ordered Gemalto to pay the costs of Infineon and its co-defendant.

The Court of Appeal’s judgment is of importance to any claim where a limitation period is alleged to have been extended due to deliberate concealment on the part of a defendant under the Limitation Act 1980 and is of particular importance to any companies facing actual or threatened damages claims following on from decisions by competition authorities. The decision of the Supreme Court to not hear Gemalto’s appeal means that the Court of Appeal’s judgment will stand as the most authoritative judgment on this subject.

The Supreme Court’s decision is the conclusion of these proceedings against Infineon (save for the issue of Infineon’s recovery of costs).

Our briefing contains an in-depth analysis of the reasoning of the Court of Appeal and discusses some of the consequences of the Court’s clarifications to the application of the Limitation Act in cases of deliberate concealment.

Freshfields represented Infineon at every step of its successful defence of this claim. The Freshfields team was led by London partner Mark Sansom, senior associates Daniel Hunt and Jessica Steele and associates Adrian Wright and Alisha Wright.