Fieldfisher prevails over Addleshaws in “David v. Goliath” competition case
European law firm Fieldfisher has won a hard fought stand-alone competition case in the Competition Appeal Tribunal for its client Achilles Information Limited ("Achilles"), against Addleshaw Goddard acting for Network Rail.
The claim arose from changes to the way in which Network Rail, which owns and operates almost the entirety of the GB rail network, controlled access to rail infrastructure contract opportunities.
Any business which wants to have access to Network Rail infrastructure contracts must satisfy a number of different conditions, including that its management systems have been audited. Historically, that audit and reporting function had been carried out by Achilles, a global supply chain risk and performance management company.
In 2018, Achilles, together with all suppliers and contractors in the rail sector were told by Network Rail that the only assurance scheme that it would recognise was RISQS (the Railway Industry Supplier Qualification Scheme). The "RISQS-only" rule, coupled with the fact that Network Rail was a 'must-have' partner for any business wishing to work in the rail sector, meant that Achilles was effectively precluded from making a credible offering of supplier assurance services to businesses in the rail sector.
John Cassels, Co-Head of Fieldfisher's Regulatory Team, who led the winning team commented that the case was a real 'David versus Goliath' situation for Achilles, as well as being a difficult decision for Achilles to pursue the case.
"Achilles was extremely reticent about challenging Network Rail when the case was essentially about Achilles seeking to be allowed to offer its services to the GB rail sector, as it had done previously. Clearly, Achilles had to weigh up the pros and cons of bringing forward a case with a partner it had previously worked with on a regular basis, particularly when that partner is Network Rail.
"For its part, Network Rail was vigorous in its defence, even to the extent of bringing in the independent regulator, the Office of Rail and Road, to give evidence in support of Network Rail."
Network Rail had argued that the RISQS-only rule was needed to ensure safety on the railways. However, this argument was undermined by the fact that in the course of correspondence with Achilles prior to the case, Network Rail had not mentioned safety at all. Some of Network Rail's witnesses seemed to be unaware of the functionality of RISQS, how it was used within Network Rail, and the fact that changes had been made to relevant standards of which they seemed to be unaware.
"Achilles had argued there should be the potential for choice of different supplier assurance schemes available to both buyers and suppliers in the rail sector and we are very pleased that the CAT found unanimously in our favour on both Chapter I and Chapter II," said Mr Cassels.
The Competition Appeal Tribunal's decisions on the case means that the Network Rail rules on supplier qualification schemes are immediately void and unenforceable. This means Achilles will be able to compete in the rail sector, which will encourage innovation and competition for assurance services.
Gavin Partridge, General Counsel of Achilles commented:
“I would like to thank John Cassels and the Fieldfisher team for what they did in helping us win such a tough case. We felt from the outset that we had strong and legitimate case to bring to the Competition Appeal Tribunal, not just on behalf of Achilles, but also for the wider rail sector.
“Achilles has 30 years’ experience in offering supplier assurance across complex, regulated and safety critical industries. We believe that giving customers the potential to choose from different supplier assurance schemes can bring benefits similar to those we see in other sectors. The dynamics of a competitive market will encourage higher standards, innovation within the supply chain, and ultimately, customer choice.
“Achilles has a very longstanding relationship with the rail industry, and we look forward to working closely with existing and new partners in the sector.”