One of the largest competition infringement related damages cases ever tried in Finland.

Stora Enso

Helsinki Court of Appeal Dismissed Metsähallitus’ Damages Claim against Stora Enso

01/06/2018

We successfully represented Stora Enso Oyj in an extensive antitrust damages trial in which Metsähallitus claimed a capital amount of nearly 125 million euros in damages jointly and severally from Finnish forestry companies Stora Enso, UPM-Kymmene Oyj and Metsäliitto Cooperative based on the forestry companies allegedly having purchased roundwood from Metsähallitus below market prices in 1997–2005.

The Helsinki District Court dismissed Metsähallitus’ claim in its entirety on 22 June 2016 and ordered Metsähallitus to compensate the forestry companies’ legal costs in full. Metsähallitus appealed the District Court’s decision to the Helsinki Court of Appeal, which upheld the District Court’s decision.

Metsähallitus filed its claim against the forestry companies in March of 2011, so this exceptionally extensive case took over seven years before the Court of Appeal rendered its judgment.

  • In 2009, the Market Court found that Stora Enso, UPM-Kymmene and Metsäliitto Cooperative had exchanged information on the roundwood market during 1997–2004 in a manner prohibited by the Competition Restrictions Act.
  • In its follow-on damages claim filed in 2011, Metsähallitus alleged that the forestry companies had purchased roundwood from Metsähallitus below market prices during and after the competition infringement found by the Market Court.
  • The Helsinki District Court dismissed Metsähallitus’ claim in its entirety on 22 June 2016 and ordered Metsähallitus to pay the forestry companies’ legal costs in the District Court in full.
  • Metsähallitus appealed the District Court’s decision to the Helsinki Court of Appeal on 14 October 2016. The main hearing in the Court of Appeal was held from 16 October 2017 to 25 January 2018 and included over thirty session days.
  • The Helsinki Court of Appeal dismissed Metsähallitus’ claim on 21 May 2018 and ordered Metsähallitus to compensate the defendant companies’ legal costs in the Court of Appeal in full.

Outset

In its final decision from 2009, the Market Court found that Stora Enso, UPM-Kymmene and Metsäliitto Cooperative had exchanged information on the Finnish roundwood market during 1997–2004 in a manner prohibited by the Competition Restrictions Act. In its follow-on damages claim, Metsähallitus alleged that the forestry companies had purchased roundwood from Metsähallitus below market prices during and after the competition infringement found by the Market Court.

Helsinki District Court dismissed Metsähallitus’ claim by a unanimous decision on 22 June 2016 and ordered Metsähallitus to compensate the forestry companies’ legal costs of 8.5 million euros from hearing the case in the District Court in full.

Metsähallitus appealed the District Court’s decision to the Helsinki Court of Appeal. In the Court of Appeal, Metsähallitus primarily claimed a capital amount of nearly 125 million euros in damages jointly and severally from the forestry companies for the roundwood purchases allegedly made from Metsähallitus below market prices. Metsähallitus’ secondary claims were separate based on the roundwood transactions it had made with each defendant company. The secondary claim against Stora Enso amounted to approximately 68 million euros, which covered over half of the total amount claimed by Metsähallitus.

In addition to the capital amounts of the damages claim, Metsähallitus claimed profit and penalty interest, which increased the amount of Metsähallitus’ overall claim significantly.

During the trial, Metsähallitus had reduced its claims substantially. The initial amount claimed jointly and severally by Metsähallitus at the District Court totalled nearly 283 million euros. However, during the District Court proceedings, Metsähallitus specified its claims and jointly and severally claimed a total amount of approximately 159 million euros. At the Court of Appeal, Metsähallitus further reduced its claims by approximately 34 million euros, since this amount of the claims was found to be statute barred based on Supreme Court ruling KKO 2016:11. This Supreme Court's preliminary ruling concerning the statute of limitation of compensation debt was issued in another trial concerning the same competition infringement. We also successfully represented Stora Enso in this trial.

Results

The Helsinki Court of Appeal rendered its judgment in the matter on 21 May 2018. The Court of Appeal upheld the District Court’s decision and dismissed Metsähallitus’ appeal and claim. The Court of Appeal also obligated Metsähallitus to compensate the forestry companies’ legal costs from hearing the case in the Court of Appeal in full. The forestry companies’ legal costs in the Court of Appeal were approximately 4 million euros in total.

The Court of Appeal was presented essentially with the same evidence as the District Court. The evidence on the alleged harm from the competition infringement was very extensive and consisted of both factual evidence as well as a considerable amount of expert evidence regarding the roundwood market and economic analyses.

The Court of Appeal accepted the position taken by Stora Enso and the other forestry companies and unanimously dismissed Metsähallitus’ claims. In its judgement, the Court of Appeal evaluated the evidence in detail and for the most part in the same manner as the District Court. Based on the evidence, the Court of Appeal found that Metsähallitus had not produced sufficient evidence to prove that Metsähallitus would have suffered damage in the delivery sales between Metsähallitus and the forestry companies due to the violation of the Act on Competition Restrictions.

The damages trial between Metsähallitus and the forestry companies is one of the largest damages cases related to a competition infringement ever tried in Finland.

The Team

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