German Court Holds Indirect Purchasers Have Standing, Defendants May Invoke Passing-On Defense

The German Federal Civil Court (BGH) has held that both direct and indirect purchasers may sue for antitrust damages, but defendants may raise the passing-on defense. Through the passing-on defense, defendants try to demonstrate that plaintiffs suffered no financial harm, as they passed on the overcharge to their own customers. The BGH's decision of 28 June 2011 could spark an increase in antitrust litigation in Germany, as it confirms that indirect purchasers have standing (an issue on which German courts disagreed in the past). The fact that the passing-on defense is now available to defendants is unlikely to deter litigious purchasers, as the key to making pass-on a successful defense is in the evidence, and Germany does not allow discovery.