A group of 7,000 Farmers file first claims in the Spanish Milk Cartel

In 2019, the Spanish National Markets and Competition Commission (CNMC) fined ten of the largest Spanish and international dairy companies and associations, including Danone, Nestlé and Lactalis, €80.6 million for cartelist behaviour. Their illegal conduct contributed to milk prices in Spain being among the lowest in the EU causing thousands of Spanish farmers to suffer serious losses.

  • A group of 7,000 farmers, representing 60% of the total numbers of farmers which have chosen to file a claim, have filed their first claims before several courts in key jurisdictions of Spain with the objective of conducting the milk cartel litigation in an orderly, efficient, and responsible way.
  • The farmers are represented by a stellar line up of legal talent taking the lead, including Eskariam, a Spanish legal services firm specialising in class actions, and Hausfeld, an international litigation law firm specialised in competition disputes and collective redress.
  • The team has instructed Paul Hitching (Hitchings & Co) - one of the most respected competition litigators in the Spanish market - as the Legal Director on the case and Compass Lexecon to provide economic evidence.

Spain, 2 December 2022

Six Milk Cartel claims were filed on behalf of a small number of farmers represented by Eskariam and Hausfeld before the Courts in a number of key jurisdictions in Spain. These lawsuits are part of a group of 7,000+ farmers with a total claim value of €800 million.

Between 2000 and 2013, ten of the largest Spanish and international dairy companies and associations, including Danone, Nestlé and Lactalis, exchanged information on purchase prices, purchase volumes and the level of surplus milk – both at a national and regional level, with the objective of acquiring milk from farmers across Spain at a lower price than that available under normal market conditions.

In 2019, the CNMC sanctioned the cartelists with fines totalling €80.6 million (Resolución S/0425/12: Industrias Lácteas 2).

A different way of litigating mass claims 

With the group representing over 60% of the total number of farmers affected by the cartel which have chosen to file a claim, filing thousands of claims at the same time is likely to overwhelm the Spanish Courts such as was the case in the Trucks Cartel. Opting for a responsible approach to litigation, the legal team filed a mix of individual claims and claims that group a small number of farmers instead. The selection of claims will show the Courts an accurate picture of the different typologies of affected clients the firms represent. The smaller number should be helpful to the judiciary, making it procedurally simpler and encouraging a swifter resolution of the claims.  

Agaprol, the largest association of milk producers in Spain, said:

Dairy farmers have been paid below the cost of production for years. This situation, enforced by the cartelists, has resulted in the closure of thousands of farms; the loss of economic activity and depopulation - a dire state of affairs for rural areas. The success of these claims would mean compensation for the losses caused over the years and would ensure that our industry can continue to supply our food chain with an indispensable product such as milk, in a viable manner.

Lianne Craig, Managing Partner of Hausfeld London, highlights:

“Given the size of our client group, it is key that their claims are litigated efficiently in order that they can be compensated for their losses promptly and fairly. We have seen how the filing of thousands of claims in the Trucks Cartel case has put an enormous strain on the Spanish Court system and we wanted to take a more strategic and streamlined approach to our clients’ cases here that would benefit all parties and the system pending any developments that might take place in due course allowing for a more effective and efficient form of collective redress within Spain.

David Fernandez, CEO of Eskariam, concludes:

“In a first phase, we filed claims in a number of key jurisdictions, so that the judiciary can assess key aspects of the claims. This way, we can avoid the courts being blocked or paralysed for years when asked to deal with 7,000 claims simultaneously. We would like to encourage a different way of litigating on behalf of those affected, especially given that Spain does not yet operate a class action or collective claims system which allows for high volumes of claims to be processed in the same manner."

First class team to act on behalf of over 7,000 dairy farmers   

ESKARIAM is a Madrid-based firm specialising in mass litigation of complex claims. The company brings collective claims using the most advanced technology in the sector to offer solutions of high legal value. Created in 2018, backed by private equity firm Moira Capital, ESKARIAM has a team of expert lawyers and other professionals specialised in the different sectors where the company operates with a focus on high-value mass claims. Its legal team has successfully handled hundreds of legal claims against financial institutions and insurers.

Hausfeld has almost 15 years of experience of recovering hundreds of millions of euros for clients in private damages claims across Europe, including in emerging jurisdictions like Spain, and has acted on some of the most complex damages claims of the last decade: with the largest client representation in Europe in the Trucks Cartel litigation; on the “Interchange Fee” litigation against Visa and Mastercard and in claims against Apple and Google in the UK and Portugal, together with Eskariam, in respect of their App Stores.  

Hitchings & Co, a firm launched in 2021, offers specialised services in competition litigation on both the claimant and defendant sides. The legal team for the case is led by Paul Hitchings, with 20 years of experience in this area, in Spain and across Europe. He has litigated over 750 Trucks claims in Spain; led the legal team on the EU Pass-on study and was lead counsel in the pioneering case where, for the very first time, a Spanish Commercial Court awarded damages in a claim arising out of a breach of Competition Law.

Compass Lexecon and its group of economic experts assist with antitrust expertise.

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