Car Shipping Cartel Faces £150M Class Action

Source: Law360 | Author: Joanne Faulkner

Five shipping companies fined for running a cartel for transporting cars to the U.K. have become the target of a £150 million ($189 million) U.S.-style class action in London led by law firm Scott+Scott UK LLP.

The claim has been filed in the U.K. Competition Appeal Tribunal to start an “opt out” collective action against MOL, “K” Line, NYK, WWL/EUKOR and CSAV, the law firm said Sunday. The legal action follows a European Commission decision to fine the companies €395 million in 2018 for violating competition law. 

The lawsuit claims dealers and buyers were overcharged because of a price-fixing cartel by five car-shipping companies.  U.K. motorists and companies who bought or leased new cars affected by the operation between October 2006 and September 2015 are automatically included in the class and would be eligible for compensation if it is successful.

The claim, which was filed by Mark McLaren under the Consumer Rights Act 2015, is believed to be worth in excess of £150 million or up to £60 per new car or light commercial vehicle, Scott+Scott said.

“When U.K. consumers and businesses purchased or leased a new car, they paid more for the delivery of that car than they should have done, as a result of a long-running cartel by five of the world’s leading maritime shipping companies,” said McLaren.

The collective action is being funded by Woodsford Litigation Funding.

The case follows a ruling by the European Commission in 2018 that found the shippers had coordinated rates, allocated tenders, coordinated reductions of capacity in the market and exchanged commercially sensitive information to maintain or increase the price of intercontinental shipping of new vehicles.

Four of the five firms were fined for these practices. MOL was granted immunity from fines because of early cooperation with the investigation.

The cartel affected passenger cars and light commercial vehicles from several well-known car brands including Ford, Vauxhall, Volkswagen, and BMW.

“Claims of this kind, where very large numbers of class members each suffered losses that are too small to litigate individually, are precisely the types of claim that the U.K. collective actions regime was designed to facilitate,” said David Scott, a partner at Scott+Scott UK LLP said:

The shipping companies have been subject to investigations and regulatory decisions by regulators all around the world, including Australia, China, Japan, Korea, Mexico, the U.S., Peru, Brazil, South Africa and Chile.  Outside the European Union, regulatory fines have exceeded $755 million, Scott + Scott said.

Representatives for the shipping companies did not immediately respond to request for comment Monday.

–Editing by Tom Mudd.

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