White & Case secures victory for Orbia in more than €1 billion private antitrust damages claim in ethylene cases

Global law firm White & Case LLP has successfully represented Orbia in evidentiary hearings before the Amsterdam District Court, which dismissed two major lawsuits by petrochemical sellers against Orbia's Vestolit business that sought more than €1 billion in antitrust damages.

The antitrust lawsuits were brought by ethylene producers Shell Chemicals Europe B.V. (SCE) and Repsol as damages actions in the wake of a 2020 European Commission judgment that Vestolit and three other ethylene purchasers had bilateral discussions of an ethylene price index, the Monthly Contract Price or MCP. The Commission's decision did not find that Orbia's conduct caused any harm or damages.

The victory over Shell Chemical and Repsol occurred after a series of evidentiary hearings before the Amsterdam Court, including hearing the views of a number of prominent economists. The court in Shell considered "a total of seventeen reports from experts they [the defendants] (jointly) engaged: Compass Lexecon, Analysis Group, Oxera, Case Associates and BRG." (Shell Judgment ¶12.4 (English trans.)).

After evaluating the internal documentary evidence, transaction data and the expert presentations, the Dutch court dismissed the claims of Shell and Repsol on the ground that the claimants had failed to meet their threshold requirements for demonstrating that Orbia's conduct had any plausible effect on the market.

White & Case partner Mark Gidley, who leads the matter, added: "We are thrilled that the Amsterdam Court recognized the upside-down nature of these petrochemical producers' antitrust damages cases, and rejected these major ethylene sellers' attempts to use the competition laws to obtain billions of additional profits at a time of rising profit margins from consumers like Vestolit."

The Amsterdam Court expressed skepticism that Shell was underpaid for its ethylene when Shell at the same time was achieving record gross margins:

• "SCE [Shell] has not thereby refuted that: the steam cracker margins achieved by ethylene suppliers—as this Court understands it, including, at least, the Shell Group—rose significantly during the infringement period . . . ." Shell Judgment ¶12.46 (English trans.).
• "Given these circumstances, this Court therefore finds that the margins achieved by ethylene suppliers (including SCE [Shell]) on the sale of ethylene during the infringement period most likely actually increased. This therefore provides no evidence that the MCP was successfully manipulated downward." Shell Judgment ¶12.47 (English trans.).

The Court observed that Shell analysts would have noticed any manipulation of the MCP index:

• "SCE [Shell] had a finance department with specialized (market) analysts, which means that an 'undervalued' MCP—and certainly an MCP that was systematically adjusted downward—and consequently the price of ethylene—must have caught its attention." Shell Judgment ¶12.49 (English trans.).

The White & Case team secured cross-border discovery through 28 U.S.C. §1782. The 1782 US court ruling led to the release of MCP pricing pairs data—the MCP data from at least four firms in arm's-length negotiation. That MCP pairs data was cited prominently in the Amsterdam Court judgments:

• "The defendants provided data covering the infringement period, which they had obtained from ICIS, regarding the parties involved in the settlements . . . . the factual accuracy of which has not been disputed by the Foundation [Repsol]." Repsol Judgment ¶8.21.2 (English trans.; emphasis in original).
• This ICIS data demonstrated that "ethylene suppliers had plenty of alternatives," which "has also been demonstrated in practice, given the settlements between suppliers and customers other than the defendants, as mentioned above in section 8.21.5 above." Repsol Judgment ¶8.21.7 (English trans., emphasis in original).
• "Given the nature of the MCP settlement process," the Amsterdam Court concluded that defendants could not have dominated the MCP as Repsol claimed, "because a settlement must always have the consent of a supplier." Repsol Judgment ¶8.21.5 (English trans.).

The lawsuits received extensive coverage in international media and the legal press.

Additional details can be found in the Amsterdam District Court's press release (English translation).

The White & Case team was led by Mark Gidley, Frank Hogue (both in Washington, DC), Kelly Newman, Dan Medici (both in Boston), Mark Powell, Diego Garcia Adanez and Mia Monas (all in Brussels).

White & Case worked with the Dutch litigation team at Houthoff, led by Rick Cornelissen, and included Davide Ballestrero, Paul Sluijter and Didi Koenders, together with German counsel Johann Brück of Hermanns Wagner Brück.

Economists Chris Feige of Analysis Group, Nicole Rosenboom of Oxera and Cento Veljanovski of Case Associates made detailed presentations to the Amsterdam Court on Vestolit's behalf.

This result is thanks to the daily involvement and commitment provided by Orbia and its in-house legal team, led by Orbia General Counsel Sheldon Hirt, Vestolit General Counsel Jorge Pruneda and Orbia Litigation Head Andrea DeShazo.

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