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Sensationalist reporting - Morrisons fights the OFT on
all fronts
9 April 2008
Heather Mills has recently attracted many
columns of press comment – and some would say sensationalist
reporting of the much publicised split with Paul McCartney.
However, sensationalist reporting is no longer the preserve of
celebrities. The ongoing battle between large supermarket chains
and the OFT recently took a similar turn. At the end of last year,
the OFT published its "provisional" view that some of the large
supermarket chains had been colluding with dairy providers to fix
the price of dairy products.
Some of the supermarkets, such as Sainsburys
and Asda, have admitted being involved in these anti-competitive
practices. However Morrisons and Tescos both deny any wrongdoing
and continue to defend themselves against the OFT's
allegations.
The provisional view was widely publicised in
a strongly worded press release, issued by the OFT and which,
without qualification, included references to Morrisons as one of
the supermarkets who the OFT accused of price-fixing in 2002 and
2003.
Morrisons took objection to this and as a
result, on 13 December, the OFT published a clarification of its
earlier press release. This clarification made it clear that
Morrisons had not been previously warned by the OFT that such
conduct might be anti-competitive, and that the OFT's provisional
findings on Morrisons were limited to collusion in respect of
certain liquid milk products in 2002.
Last month Mr Justice Davis, sitting in the
High Court, gave Morrisons permission to seek judicial review of
the OFT's decisions in publicising this high profile investigation.
Mr Justice Davis' judgement suggested that the OFT had tried to
attract sensationalist publicity by engaging in such
public relations activities.
It seems that Morrisons may also be bringing
libel proceedings against the OFT for its earlier retracted
statement. Given the widespread negative press for Morrisons and
the other supermarkets involved, which was generated by the OFT's
press release, damages may prove to be substantial. Amongst other
things, the OFT may face criticism for issuing such inflammatory
press releases on its "provisional" decision, before the inquiry is
fully concluded.
The use of both judicial review and libel
proceedings against the OFT at this stage, before the OFT's final
position is set out, is a new departure. However it shows the
willingness of some businesses to use all the legal means at their
disposal to object to what they view as over-zealous regulators. If
the OFT continues to take as aggressive a stance as it has in
recent years towards its investigations, it is possible that
companies in other sectors which are frequently targeted by the
OFT, such as construction and pharmaceuticals, may follow
Morrisons' example.
For more information or advice, please contact
Fiona
Carter or Oliver Sweeeney.
The content of this bulletin is provided for
the purposes of general interest and information. It contains only
brief summaries of aspects of the subject matter and does not
provide comprehensive statements of the law. It does not constitute
legal advice and does not provide a substitute for it.