Simpson Thacher error leaves client unable to challenge CMA merger block

Simpson Thacher’s client Aramark, a US food services and facilities management group, must unwind its merger with UK catering company Entier after the law firm missed the deadline to appeal the competition regulator’s decision blocking the deal.

In a judgment handed down on Tuesday (10 March), the Competition Appeal Tribunal refused to extend the statutory time limit after the appeal was filed one day late.

The tribunal said the firm had “misinterpreted the rules” when calculating the deadline for lodging the appeal.

Simpson Thacher had informed Aramark that the deadline was 13 February and that they would file a day earlier on 12 February. In fact, the deadline was 12 February, meaning the appeal ultimately filed on 13 February was a day late.

After Aramark was informed of the missed deadline, they sought a second opinion from Shoosmiths and engaged Latham & Watkins on possible next steps.

Deal blocked

The dispute stems from a January decision by the Competition and Markets Authority ordering Aramark to unwind its purchase of Entier.

The regulator concluded the deal combined two of the three main providers of catering, cleaning and maintenance services to offshore facilities such as ships and oil rigs in the UK.

Aramark had four weeks to challenge the decision before the CAT.

One day late

In his ruling, tribunal chair James Wolffe KC acknowledged the “substantial prejudice” to Aramark from losing the opportunity to challenge the CMA’s decision but said the circumstances did not justify extending the deadline.

“I take fully into account the substantial prejudice which Aramark sustains by reason of losing the opportunity to obtain a review of the [CMA] decision, and that the underlying reason why this has happened is an error by its solicitor in computing the time limits,” he said.

“I do not consider that these are exceptional circumstances which justify an extension to the statutory time limit.”

The CAT can extend filing deadlines in exceptional circumstances, but such extensions are rare and the rules governing competition appeals have been in place since 2003.

The ruling leaves Aramark without a route to challenge the CMA’s decision before the tribunal.

Possible claim

Later in the judgment, Wolffe noted that “the consequences for Aramark of the failure to file timeously are mitigated by the availability of that claim,” referring to the possibility that Aramark could pursue a negligence claim against its lawyers over the missed deadline.

In a statement, Aramark said: "We are very disappointed with the decision of the Competition Appeal Tribunal and are reviewing our options including an appeal."

Simpson Thacher could not be reached for comment by the time of publication.