HP-2020-000016 - [2025] EWHC 1451 (Ch)

Cabo’s pleaded case was that MGA’s conduct was an abuse of a dominant position in three respects: (i) MGA threatened to withdraw supply to its customers, in order to exclude Worldeez; (ii) MGA’s threats to instigate legal proceedings were not a genuine assertion of MGA’s legal rights, but were solely aimed at stifling a competitor; and (iii) MGA disparaged Cabo/Worldeez to toy retailers, in a way recognised by the French Competition Authority as constituting an abuse.

At the hearing, and particularly in its closing submissions, Cabo maintained that each of the three pleaded elements of MGA’s conduct was abusive in its own right, but also said that MGA’s conduct amounted to an “overall anti-competitive campaign to exclude Worldeez from the market” which could be characterised as forming a single abuse or course of abusive conduct. Cabo’s contention was that MGA’s conduct was nakedly restrictive of competition, such that there was no requirement to go further and assess the effects of that conduct; but that in any event the anticompetitive effects were obvious.

MGA’s response, as put in its closing submissions, was that (i) the threats to withdraw supply to customers who stocked Worldeez were a legitimate and proportionate response to a commercial attack, and that save for the cancellation of the initial orders placed by The Entertainer, MGA’s conduct did not cause the retailers not to stock Worldeez; (ii) MGA’s threats of litigation did not amount to abuse on the basis of the criteria set out in the relevant case-law, in particular because there were reasonable grounds to support an allegation of passing off; and (iii) the denigration or disparagement of a competitor is not a recognised category of abuse, and MGA’s conduct was in any event very different from the sort of conduct regarded as constituting an abuse in the French Sanofi Aventis decision.