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Antitrust and digital regulations update – November 2024

European Union – antitrust

European Commission

Commission fines Pierre Cardin and its licensee Ahlers €5.7 million for restricting cross-border sales of clothing

On 28 November 2024, the European Commission imposed fines totaling €5.7 million on Pierre Cardin and its largest licensee, Ahlers, for breaching European Union (EU) antitrust rules. The companies were found to have restricted cross-border sales of Pierre Cardin-branded clothing and sales to specific customers, violating Article 101 of the Treaty on the Functioning of the European Union (TFEU) and Article 53 of the European Economic Area (EEA) Agreement.

Pierre Cardin, a French fashion company, licenses its trademark to third parties for the manufacture and distribution of Pierre Cardin-branded clothing. Ahlers, the largest licensee in the EEA during the infringement period, was subject to an investigation launched by the Commission following unannounced inspections on 22 June 2021. Formal proceedings were initiated on 31 January 2022, with a Statement of Objections issued on 31 July 2023.

The investigation revealed that between 2008 and 2021, Pierre Cardin and Ahlers engaged in anticompetitive agreements and concerted practices to ensure Ahlers’ territorial protection. These agreements would have:

1. Prevented other Pierre Cardin licensees and their customers from selling, online and offline, branded clothing outside their licensed territories.

2. Restricted sales to low-price retailers such as discounters, limiting consumer access to lower-priced goods.

These alleged absolute territorial protection practices would have distorted the internal market by preventing parallel trade, which typically fosters price competition and benefits consumers with lower prices and greater product diversity.

Fines were calculated based on the Commission’s 2006 Guidelines, considering the gravity, geographic scope, and duration of the infringement. A claim for inability to pay under point 35 of the Guidelines led to a fine reduction. The final penalties were €2,237,000 for Pierre Cardin and €3,500,000 for Ahlers.

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Antitrust and digital regulations update – October 2024

EU antitrust updates

European Commission Fines Teva EUR 462.6 Million Over Patent System Misuse and Disparagement Campaign

On 31 October 2024, the European Commission imposed a EUR 462.6 million fine on Teva for abusing its dominant position to delay competition against its multiple sclerosis treatment, Copaxone. The Commission found that Teva misused patent procedures to extend Copaxone’s exclusivity and disseminated misleading information about a competitor’s product to hinder its market entry and uptake.

Teva, a global pharmaceutical firm, held a basic patent for the active ingredient glatiramer acetate in Copaxone, which expired in 2015. The Commission’s investigation revealed that Teva extended Copaxone’s market exclusivity in multiple EU countries through two main strategies:

The Commission determined that Teva’s actions collectively violated Article 102 of the Treaty on the Functioning of the European Union (TFEU), marking the first time the Commission has fined a company for these specific practices. Teva’s conduct may have prevented price reductions, impacting public health budgets. Following inspections of Teva’s facilities in 2019, the Commission opened proceedings in 2021 and issued a Statement of Objections in 2022.

  1. Patent Manipulation: As its original patent neared expiration, Teva filed multiple divisional patent applications, creating a web of secondary patents focused on production processes and dosage. Teva used these patents to initiate injunctions against competitors. When it appeared likely that these patents would be revoked, Teva withdrew them, avoiding formal invalidity rulings and prolonging legal uncertainty for rivals.
  2. Disparagement Campaign: Teva launched a systematic campaign to undermine a competing glatiramer acetate product, spreading misleading information about its safety and efficacy despite approval from relevant health authorities. This campaign targeted key stakeholders, including healthcare professionals and policymakers, to slow or block market entry in several EU states.
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Actual competition. Going digital and beyond

Over the last two years, during which I really got introduced to the competition law world, I copped onto at least three remarkable things. The first one is that there is a tendency for EU and national trustbusters and judges across the board to grasp at straws by sticking to a stale legal framework that has never been so clearly obsolete as it is now in the digital era. In stark contrast stands the second one, that is, the unprejudiced view that I’ve spotted in many not-always-so-young with the strange habit to think out the box. As a glimmer of hope in this paradoxical picture, the third is the realisation not only that innovative ideas may have more value than we think but also that they can be put forward by the same ‘disruptive’ means that are pushing the outer boundaries of the antitrust tectonic plate. Continue reading “Actual competition. Going digital and beyond”