Court of Appeal upholds order regarding disclosure of custodians’ personal mobile phones and emails in competition claim

Phones 4u Ltd (in administration) v Deutsche Telekom AG & Ors [2021] EWCA Civ 116

On 2 February 2021, the Court of Appeal upheld a disclosure order made by Roth J on 11 August 2020 (“the Order”). Under the Order, various Defendants to competition proceedings brought by Phones 4u were ordered to write to senior current and former employees with a request that they grant access to their personal mobile phones and emails so that these can be searched for work-related communications that may fall within standard disclosure.

The Court of Appeal (Sir Geoffrey Vos MR, Asplin and Green LJJ) considered for the first time the scope of the power under CPR Part 31 to make orders in relation to documents that are in the possession of non-parties and which may meet the relevant test for disclosure (in this case, standard disclosure). Roth J had himself granted permission to appeal (to some of the Defendants) on the basis that this issue – the “jurisdiction issue”- was of increasing importance as more employees work from home and make use of personal devices and email accounts for work-related communications.

The Jurisdiction Issue

The Defendants argued that Roth J had exceeded his powers under Part 31 because, amongst other things, (i) the mobile phones and email accounts were not themselves within the “control” of the Defendants under CPR, r.31.8 and (ii) the phones and accounts would inevitably contain personal and private documents that were not within the Defendants’ control.

The Defendants relied in this regard on Bank of Dubai Ltd v Galadari, The Times 6 October 1992 (“Galadari”), a pre-CPR case in which the Court of Appeal overturned an order that agents use all lawful means to obtain possession, custody or power of documents held by their undisclosed principals. Reliance was also placed on dicta of Lord Diplock in the House of Lords case Lohnro v Shell [1980] 1 W.L.R. 627.

The Court of Appeal rejected the challenge to Roth J’s power to make the Order. Consistently with Phones 4u’s arguments on the appeal, the Master of the Rolls (giving the Judgment of the Court) reasoned as follows: -

  • it was common ground that the personal mobile phones and email accounts contained some “work-related” documents that were within the control of the Defendants as employers and/or principals;
  • disclosure under the CPR is “an essentially pragmatic process aimed at ensuring that, so far as possible, the relevant documents are placed before the court at trial to enable it to make just and fair decisions on the issues between the parties”, and Part 31 is drafted “in broad terms so as to allow the court maximum latitude to achieve this objective”;
  • Roth J had concluded that the Defendants’ duty of “reasonable search” (under CPR, r. 31.7) extended to conducting searches for the work-related documents on personal mobile phones and in personal email accounts so that these could be disclosed (to the extent they meet the test for standard disclosure);
  • the Order provided the mechanism for that search and, in doing so, specified “how disclosure is to be given” within the meaning of CPR, r. 31.5(8). 

Other Grounds of Appeal

The Court of Appeal also dealt with arguments that the Order, even if within the powers under CPR Part 31, fell outside the proper exercise of Roth J’s discretion. These were given relatively short shrift. Most notably: -  

  • the Court of Appeal re-affirmed the high hurdle for challenges of this nature – “The question we have to answer is whether the judge exercised his discretion in relation to the management of disclosure in this case in such a way that was “so plainly wrong that it must be regarded as outside the generous ambit of the discretion entrusted to the judge”.”
  • Roth J had rightly set out to interfere as little as possible with the privacy rights of the disclosure custodians;
  • whilst there were alternative disclosure mechanisms that might have been used (such as involving independent solicitors), the mechanism in the Order was not “obviously wrong, disproportionate or unreasonable”, and there was implicit in the Order a liberty for the disclosure custodians (or other affected third parties) to apply to Roth J;
  • the Order did not conflict with the General Data Protection Regulation or the Data Protection Act 2018 because any data processing would (i) be with the consent of the disclosure custodians as data subjects (Article 6.1(a) GDPR) and (ii) be necessary for “compliance with a legal obligation to which the [data] controller is subject” (Article 6.1(c) GDPR).

Kenneth MacLean QC and Owain Draper acted for Phones 4u in the appeal and in the competition proceedings, instructed by Ted Greeno of Quinn Emanuel Urquhart & Sullivan LLP. You can find the full judgment here