Page 48 - 2012 Annual Report

VIVENDI l 2012 l Annual Report 48
GROUP PROFILE – BUSINESSES – LITIGATION – RISK FACTORS 1
1
SECTION 3 - LITIGATION
COMPLAINT OF BOUYGUES TELECOM AGAINST SFR
AND ORANGE IN CONNECTION WITH THE CALL TERMINATION
AND MOBILE MARKETS
Bouygues Telecom brought a claim before the French Competition Council
against SFR and Orange for certain alleged unfair trading practices in the
call termination and mobile markets (“price scissoring”). On May 15, 2009,
the French Competition Authority (the “Authority”) resolved to postpone its
decision on the issue and remanded the case for further investigation. On
December 13, 2010, SFR was heard on these allegations by the instructing
magistrate. On August 18, 2011, SFR received a notification of grievances
in which the Authority noted the existence of abusive price discrimination
practices. On December 13, 2012, the Authority fined SFR €65.708 million.
SFR has appealed this decision.
SFR AGAINST FRANCE TÉLÉCOM
On August 10, 2011, France Télécom filed a claim against SFR before the
Paris Commercial Court. France Télécom asked the Court to compel SFR to
stop the overflow traffic at the point of interconnection of their respective
networks.
CLCV AGAINST SFR AND OTHER TELECOM OPERATORS
On January 7, 2013, the French consumer protection association, CLCV
(consumption, housing and quality of life) sued several French telecom
operators, including SFR, before the Paris Tribunal of First Instance. It
is seeking the removal of certain clauses that it considers abusive from
subscription contracts.
PARABOLE RÉUNION
In July 2007, the group Parabole Réunion filed a legal action before
the Paris Tribunal of First Instance following the termination of its
rights to exclusively distribute the TPS channels in Reunion Island,
Mayotte, Madagascar and Mauritius. Pursuant to a decision dated
September 18, 2007, Canal+ Group was prohibited, under fine, from
allowing the broadcast by third parties of these channels or those
replacement channels that have substituted these channels. Canal+ Group
appealed this decision. In a ruling dated June 19, 2008, the Paris Court of
Appeal partially reversed the judgment and stated that these replacement
channels were not to be granted exclusively if the channels were made
available to third parties prior to the merger with TPS. Parabole Réunion
was again unsuccessful in its claims concerning the content of the
channels in question. On September 19, 2008, Parabole Réunion appealed
to the French Supreme Court. On November 10, 2009, the French Supreme
Court dismissed the appeal brought by Parabole Réunion. In the context of
this dispute, various jurisdictions have taken the opportunity to recall that
in the event of the loss of the TPS Foot channel, Canal+ Group must make
available to Parabole Réunion a channel of similar attractiveness. Non-
compliance with this order would result in a penalty. On September 24,
2012, Parabole Réunion filed a claim against Canal+ France, Canal+ Group
and Canal+ Distribution before the enforcement magistrate of the Court
of First Instance of Nanterre (Tribunal de grande instance de Nanterre)
seeking enforcement of this fine (a request for such enforcement having
been previously rejected by the enforcement magistrate of Nanterre, the
Paris Court of Appeal and the French Supreme Court). On November 6,
2012, Parabole Réunion expanded its claim to cover the TPS Star,
Cinecinema Classic, Cult and Star channels.
In parallel with the foregoing proceedings, on October 21, 2008, Parabole
Réunion and its shareholders filed a claim against Canal Réunion,
Canal Overseas, CanalSatellite Réunion, Canal+ France, Canal+ Group
and Canal+ Distribution, seeking the enforcement of the agreement
entered into on May 30, 2008, pursuant to which the companies would
combine their TV channel broadcasting activities in the Indian Ocean.
The execution of this agreement was contingent upon the satisfaction
of certain conditions precedent. As these conditions were not satisfied,
the agreement became null and void. On June 15, 2009, the Commercial
Court rejected Parabole Réunion’s claim. Parabole Réunion appealed this
decision and the appeal was denied. On May 23, 2011, Parabole Réunion
appealed to the French Supreme Court.
This appeal was dismissed on May 30, 2012.
On April 26, 2012, Parabole Réunion filed a complaint against Canal+
France, Canal+ Group and Canal+ Distribution before the Paris Tribunal
of First Instance asking the Tribunal to acknowledge the failure of the
companies of the Group to fulfill their contractual obligations to Parabole
Réunion and their commitments to the Ministry of Economy.
ACTION BROUGHT BY THE FRENCH COMPETITION AUTHORITY
REGARDING PRACTICES IN THE PAY-TV SECTOR
On January 9, 2009, further to its voluntary investigation and a complaint
by France Télécom, the French Competition Authority sent Vivendi and
Canal+ Group a notification of allegations. It alleges that Canal+ Group has
abused its dominant position in certain Pay-TV markets and that Vivendi
and Canal+ Group colluded with TF1 and M6, on the one hand, and with
Lagardère, on the other. Vivendi and Canal+ Group have each denied these
allegations.
On November 16, 2010, the French Competition Authority rendered a
decision in which it dismissed the allegations of collusion, in respect of
all parties, and certain other allegations, in respect of Canal+ Group. The
French Competition Authority requested further investigation regarding
fiber optic TV and catch-up TV, Canal+ Group’s exclusive distribution
rights on channels broadcast by the group and by independent channels
as well as the extension of exclusive rights on TF1, M6 and Lagardère
channels to fiber optic and catch-up TV. On December 17, 2010, France
Télécom appealed the decision before the Court of Appeal. Vivendi and
Canal+ Group joined these appeal proceedings. On July 15, 2011, France
Télécom withdrew its application for an annulment of the decision of the
Competition Authority.
INQUIRY INTO COMPLIANCE WITH CERTAIN UNDERTAKINGS GIVEN
IN CONNECTION WITH THE MERGER OF CANALSATELLITE AND TPS
The French Competition Authority opened an inquiry into compliance with
certain undertakings given by Vivendi and Canal+ Group in connection with
the merger of TPS and CanalSatellite.
On September 20, 2011, the French Competition Authority rendered a
decision in which it established that Canal+ Group had not complied with
certain undertakings – some it considered essential – on which depended
its decision authorizing, in 2006, the acquisition of TPS and CanalSatellite
by Vivendi and Canal+ Group. As a consequence, the French Competition
Authority withdrew the merger authorization, requiring Vivendi and Canal+
Group to re-notify the transaction to the French Competition Authority
within one month. Furthermore, the French Competition Authority ordered
Canal+ Group to pay a €30 million fine.