On 23 February 2022, the Paris Court of Appeal handed down its judgment in the dispute between SAS 10 Médias and SAS L'Equipe, SA Les Editions P. Amaury and SAS Team Media (Paris, Division 5, Chamber 4, 23 February 2022, Case No. 19/19239).
In this ‘follow-on’ case – i.e. arising from proceedings before the Competition Authority – 10 Médias sought compensation for several heads of damage it claimed to have suffered, relating to both the print newspaper and the website Le10sport.com.
At first instance, the Paris Commercial Court, in its judgment of 11 June 2019 (Case No. 2013004738), had recognised:
- damages for loss of profit during the actual period of publication of the print edition of Le10sport;
- damages for a limited loss of opportunity (a loss-of-opportunity factor of 4 per cent) in respect of the print edition (beyond the actual period of publication);
- damages for loss of earnings in respect of the Le10sport.com website;
- no loss of opportunity in respect of the website.
The Court of Appeal partially set aside the judgment of 11 June 2019 handed down by the Paris Commercial Court (Case No. 2013004738) and held that the civil liability of Editions P. Amaury is not disputed, but that it is for the company that is the victim of the anti-competitive practice to demonstrate the existence of a causal link between that practice and the alleged damage, which cannot be presumed.
However, in this case, the defendants have at length outlined the difficulties facing the press sector to explain the very limited potential that could be expected from the newspaper’s development. Nevertheless, the Court considers that ‘neither the crisis in the traditional daily print press sector since 2008, nor the specific characteristics of the daily sports press – particularly in the “low-price” segment’, nor the newspaper’s inherently poor quality – assuming this to be established – are such as to rule out a causal link between the exclusionary practice committed by the Amaury Group and the alleged damage”.
In this context, the Court will nevertheless uphold the existence of a direct causal link between the sanctioned exclusionary practice and the alleged damage, concluding that:
- the existence of damage in the form of lost profits over the actual period of publication of the print daily Le10sport;
- the absence of loss of opportunity in relation to the print edition, given the lack of any serious prospect of achieving a positive annual profit margin with 10Sport.com;
- the existence of loss of profit in respect of the Le10sport.com website;
- the absence of loss of opportunity in respect of the website;
- the existence of non-pecuniary damage, justified by the fact that the alleged practices would have ‘tarnished the image and reputation of 10 Medias in the eyes of the public’ and ‘undermined the trust and momentum generated by the launch of this new daily newspaper’.
Whilst the total amounts of damages awarded by the Commercial Court and the Court of Appeal are very similar, at around 2 million euros (compared with a claim for more than 52 million euros), we note that both the Commercial Court and the Court of Appeal reached different conclusions on the two main issues at hand:
- the construction of a counterfactual scenario in the absence of an unaffected market;
- the determination of whether a loss of opportunity existed in a market segment that has not yet been exploited.
On the first point concerning the definition of a counterfactual scenario, the Court of Appeal ultimately held that, ‘in the absence of a comparable market in France or Europe for this segment of a low-cost national sports daily newspaper, the Court will rely on 10 Médias’ forecasts derived from the provisional budgets’, thereby holding that the company’s forecasts prior to the newspaper’s launch remain the best available estimate of a market which was ultimately never exploited beyond the limited period during which the newspapers *Le10sport* and *Aujourd’hui Sport* were published.
It is evident that the Court prefers to rely, as suggested by the Commission’s Practical Guide, on the company’s provisional budgets, as it considers it impossible to construct a counterfactual scenario referring to markets unaffected by the practices. This approach differs from that adopted by the Commercial Court, which had, depending on the parameters, either taken into account the actual situation of 10 Médias or L’Equipe (the only national print sports daily, although not in the low-price segment) or assumptions derived from the analyses of the parties’ respective financial experts.
On the second point concerning loss of opportunity, the Court of Appeal dismissed the appellant’s claims, which alleged a loss of opportunity in relation to both the print daily and the Le10sport.com website, on the grounds that, as regards the print daily, there was “no sufficiently serious prospect of achieving a positive annual margin”. The Court of Appeal thus held that “the current and certain disappearance of a favourable prospect cannot be accepted”, whereas the Commercial Court had considered that “the loss of a chance, however slim, is compensable”. The Paris Commercial Court had assessed the “probability of success” of the “favourable prospect” at just 4 per cent, considering “that the market for ‘print’ daily newspapers is not a growing market during the period in question ” and that “growth would have required additional investment”.
With regard to the website, the court considered that this constituted an ancillary loss to the damage suffered by the print edition and that the absence of any loss of opportunity in relation to the latter ruled out the existence of a loss of opportunity for the digital component.
In its judgment, the Court of Appeal also emphasised the need to justify the discounting of a loss arising from the unavailability of funds at a rate different from the statutory interest rate. The Court of Appeal thus held that, “in the absence of evidence of specific loss, the loss of opportunity may be assessed by applying the statutory interest rate corresponding to a risk-free investment to the sum of which the aggrieved company was deprived”. Finally, the judgment also emphasised, with regard to claims for non-pecuniary damage, that “no presumption of damage may be accepted in matters of compensation for anti-competitive practices”.
Contributors: Blanche Feauveaux and Maurice Nussenbaum
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