Follow-up: (Pri­ce) ren­ego­tia­ti­ons in the sup­p­ly chain and risks of preli­mi­na­ry injunc­tion proceedings

Increased ener­gy and raw mate­ri­al pri­ces lead to sup­pli­ers (having to) pass on rising cos­ts to their cus­to­mers and request their cus­to­mers to (re)negotiate con­tracts. If pri­ce ren­ego­tia­ti­on requests are com­bi­ned with the announce­ment that mate­ri­al pro­cu­re­ment is no lon­ger pos­si­ble or only pos­si­ble with dif­fi­cul­ty or that the supplier’s liqui­di­ty is threa­ten­ed, the­re is a risk that a preli­mi­na­ry injunc­tion will be issued at the request of the cus­to­mer wit­hout hea­ring the supplier.

In the con­text of our last news artic­le on this topic, the recent decis­i­on of the Ger­man Fede­ral Con­sti­tu­tio­nal Court is wel­co­me: It shar­pens the con­tours of pro­ce­du­ral equa­li­ty of arms and once more empha­si­s­es the very excep­tio­nal situa­ti­on of not hol­ding a hea­ring in preli­mi­na­ry injunc­tion proceedings.

The hea­ring as a gene­ral principle

In prin­ci­ple, it fol­lows from the right to be heard that the respon­dent (in this case the sup­pli­er) must be heard befo­re a court order gran­ting a preli­mi­na­ry injunc­tion is issued and must thus be given the oppor­tu­ni­ty to influence a forth­co­ming court decis­i­on. The court must equal­ly grant the par­ties the oppor­tu­ni­ty to pre­sent ever­y­thing rele­vant for the court decis­i­on and to assert all pro­ce­du­ral defen­ces neces­sa­ry to ward off the opponent’s claim.

Such an oppor­tu­ni­ty must be gran­ted to the par­ties as a gene­ral rule; howe­ver, the oppor­tu­ni­ty to make a state­ment can be gran­ted in various ways (e.g. by the court giving the respon­dent the oppor­tu­ni­ty to make a state­ment by phone).

No hea­ring as an (utter) exception

The courts may only devia­te from this prin­ci­ple in very strict excep­tio­nal cases. In addi­ti­on to par­ti­cu­lar urgen­cy, the pre­re­qui­si­te is that the pur­po­se of the preli­mi­na­ry injunc­tion pro­cee­dings would other­wi­se be frustrated.

The Ger­man Fede­ral Con­sti­tu­tio­nal Court made it clear that a decis­i­on made (to the respondent’s dis­ad­van­ta­ge) wit­hout hea­ring the respon­dent must cle­ar­ly reve­al that the court was awa­re of the excep­tio­nal natu­re of its pro­ce­du­ral approach. The decis­i­on must explain why a par­ty is being kept out of the pro­cee­dings. A mere­ly for­mu­laic jus­ti­fi­ca­ti­on that “due to urgen­cy” the hea­ring is dis­pen­sed with is not suf­fi­ci­ent. In par­ti­cu­lar, less dra­stic alter­na­ti­ves must have been unavailable, i.e. a hea­ring by pho­ne at short noti­ce must have been impossible.

Con­se­quen­ces and recom­men­ded action

Even in cases of threa­ten­ed deli­very stops and even more so in cases of a request for ren­ego­tia­ti­on, the­re is usual­ly still enough time for the court to give the respon­dent (here the sup­pli­er) the oppor­tu­ni­ty to com­ment, at least by phone.

Sin­ce, not­wi­th­stan­ding this, it can­not be ruled out that courts will devia­te from the gene­ral requi­re­ment of a hea­ring in preli­mi­na­ry injunc­tion pro­cee­dings, sup­pli­ers should not only pay very careful atten­ti­on to their com­mu­ni­ca­ti­on with the cus­to­mer, but they should also make use of their pre­ven­ti­ve legal opti­ons. Sup­pli­ers can and should also coun­ter the eco­no­mic and entre­pre­neu­ri­al risk asso­cia­ted with the issu­an­ce of a preli­mi­na­ry injunc­tion by fil­ing a pro­tec­ti­ve let­ter. This can at least ensu­re that their own descrip­ti­on of the facts is taken into account.