This week, the Competition Appeal Tribunal (CAT) issued its judgment in Justin Le Patourel v BT Group PLC, dismissing the claim in its entirety. This ruling is a landmark decision, marking the first-ever opt-out competition collective action case under the Consumer Rights Act 2015 to be brought to trial in the UK. Oxera’s team acted as the expert economic advisers for BT and its legal team throughout the case led by Helen Jenkins as Expert, Felipe Flórez Duncan as Project Director and Michael Weekes as Project Manager.

The Class Representative had alleged that BT abused its dominant position by charging excessive prices for standalone fixed voice services (SFV), such as landline telephone access and calls purchased separately from other telecom services. The claim sought £1.3 billion in damages.

While the CAT concluded that BT’s prices were “excessive” when compared to costs, it found the extent of the excess to be far less than claimed by the Class Representative, since proper account had not been taken of the fact that firms in competitive markets should enjoy a considerable degree of flexibility in how they recover common costs. This significant difference meant that the CAT’s starting point for assessing the potential “unfairness” of BT’s prices was markedly different from the approach advocated by the Class Representative.

In addition, the CAT’s findings considered other factors, including the economic value that BT provided to its SFV customers and the range of prices observed in a competitive market, including those of BT’s competitors. Based on this analysis, the CAT concluded that BT’s prices were not unfair.

Felipe Flórez Duncan, Partner at Oxera, commented on the ruling: “We are proud to have assisted BT and its legal team in this landmark case, as well as to see the CAT acknowledge that the professional and constructive approach by the economic experts greatly assisted them in reaching their conclusions. The judgment that BT did not abuse its dominant position and that the claim has been dismissed will have significant implications for future cases brought under the UK collective actions regime, as well as for excessive pricing cases more broadly.”