Diageo DV Limited v Nio SRL (in liquidation) [2025] EWHC 2109 (Comm)

[2025] EWHC 2109 (Comm)Case No LM-2025-000222IN THE HIGH COURT OF JUSTICEBUSINESS AND PROPERTY COURTSOF ENGLAND AND WALESLONDON CIRCUIT COMMERCIAL COURTVenue Royal Courts of Justice, Rolls Building, Fetter Lane, London, EC4A 1NLDate 6 August 2025
Before
DAVID BAILEY K.C.(sitting as a Deputy High Court Judge)
Between
DIAGEO DV LIMITEDClaimantNIO S.R.L. (in liquidation)Defendant
Mr Stewart Chirnside (instructed by Bristows LLP) for Claimant for The Defendant did not appear and was not representedHearing Hearing date: 18 July 2024
JUDGMENTThis judgment was handed down remotely at 4pm on 6 August 2025 by circulation to the parties or their representatives by e-mail and by release to the National Archives.David Bailey K.C. (sitting as a Deputy High Court Judge):
[1]The Claimant is an English company within the Diageo group of companies which carries on business producing and distributing alcoholic beverages worldwide. The Defendant is an Italian company which is currently in voluntary liquidation. Prior to its entry into liquidation, the Defendant carried on business as an investment company and was the previous owner of a category ‘A’ share in another Italian company called Niococktails s.r.l. (“Niococktails”).[2]By an application notice, dated 11 June 2025, the Claimant applied for an interim anti-suit injunction to restrain the Defendant from pursuing, or taking any further steps in, legal proceedings it commenced against the Claimant before the Civil Court of Milan in Italy by a Writ of Summons dated 26 March 2025 with case number RG17199/2025 (“the Italian proceedings”), until further order.[3]The primary basis of the Claimant’s application is that the Italian proceedings have been commenced by the Defendant in breach of an agreement conferring exclusive jurisdiction on the English courts.[4]The application was listed to be heard by me on the afternoon of 18 July 2025. According to the evidence of Ms Anna Cook (a partner in the firm of solicitors representing the Claimant), the Claimant arranged to have the application notice (and related documents) served upon the Defendant in Italy pursuant to the Hague Service Convention. On 8 July 2025, Ms Cook was advised by the Claimant’s Italian lawyers that the bailiff anticipated service would be effected on the Defendant in Italy within a week to 10 days and that the documents had also been sent to the Defendant’s certified email address.[5]I received a hearing bundle (consisting of two witness statements made by Ms Cook with exhibits), a bundle of authorities and a skeleton argument from the Claimant in advance of the hearing. However, I did not receive a skeleton argument (or any other materials) from the Defendant. Instead, at the outset of the hearing, Mr Stewart Chirnside (who appeared on behalf of the Claimant) advised me that his solicitors had received an email that morning from the Defendant’s Italian lawyers asserting that the Defendant had not been validly served with the application and, given the absence of valid service and the short notice, requesting an adjournment of the application to a later date. The Claimant opposed an adjournment primarily on the ground that the application was urgent because, subject to injunctive relief, the Claimant would be required to serve its response to the Italian proceedings on 29 July 2025.[6]I was unable, on the evidence before me, to determine whether or not service had been validly effected on the Defendant in accordance with Italian law. Nonetheless, I intimated to the Claimant that I was prepared to entertain the application for an interim injunction in the absence of the Defendant on an ex parte on short notice basis. In my judgment, this course more closely accorded with the overriding objective than granting an adjournment for the following reasons. First, as the Claimant submitted, the application was urgent given the deadline of 29 July 2025 for filing a response in the Italian proceedings. Secondly, an adjournment was likely to increase the costs overall and there was no certainty that an inter partes hearing could be accommodated before 29 July 2025. Thirdly, if I granted an interim injunction, the order would specifically allow for the Defendant to apply to have it set aside on notice and would also be subject to an early return date before the beginning of next term.[7]At the conclusion of the hearing, I granted an interim anti-suit injunction returnable on 8 September 2025 largely on the terms sought by the Claimant, with reasons to follow. This judgment sets out my reasons for making that order. The Contractual Scheme[8]On 23 November 2023 the parties entered into a Share Purchase Agreement (“the SPA”) pursuant to which the Claimant agreed to purchase the category A share in Niococktails from the Defendant. The purchase price payable by the Claimant comprised:(i) a Completion Payment of €2.75 million;(ii) a Deferred Payment of €1.25 million payable within 10 business days of 31 December 2024 and (ii) and an Exit Payment of at least €1 million which is payable if the Claimant (or another company in the Diageo Group) acquired the entire corporate capital of Niococktails (or there was no Exit) prior to 1 December 2027.[9]By clause 5 of the SPA, the Defendant granted various indemnities to the Claimant. In particular, by clause 5.2 the Defendant agreed to provide an indemnity in respect of Relevant Claims which were defined to include claims made by named companies including Proximo Spirits Inc and McGregor Sports and Entertainment LLC (“the Proximo and McGregor entities”). Clause 6.2 provided that the Claimant would be entitled to withhold a sum equal to the estimated liability for certain defined claims against the Deferred or Exit Payment payable under the SPA. Schedule 3 to the SPA set out the Defendant’s obligations on Completion including at paragraph 1(a) that the parties would execute a Deed of Transfer in agreed form “only for the purposes of Section 2470 of the Italian Civil Code without novation or modification of this agreement, which shall remain in full force and effect in accordance with its terms.”[10]Of central importance for present purposes, clause 24 of the SPA (entitled ‘Governing law and jurisdiction) provided:
“24.1 This agreement and any dispute or claim (including non-contractual disputes orclaims) arising out of or in connection with it or its subject matter or formationshall be governed by and construed in accordance with English law 24.2 Each party irrevocably agrees that any dispute or claim (including non-contractualdisputes or claims) arising out of or in connection with this agreement or its subjectmatter or formation will be determined by the courts of England.”
[11]Completion under the SPA occurred on 1 December 2023. In accordance with paragraph 1(a) of Schedule 3 of the SPA, the parties executed a Deed of Transfer dated 1 December 2023 which was in agreed form pursuant to which the A Share was transferred by the Defendant to the Claimant.[12]Article 2 of the Deed of Transfer provided that the Completion Payment of €2.75 million (which had been paid into escrow by the Claimant pursuant to the SPA) would be paid to the Defendant on the signing of the Deed of Transfer. The same article also recorded that the parties agreed that additional sums “may be payable” by the Claimant “depending on what is separately agreed between the parties”. The Claimant submitted that this was a reference to the agreement to pay the deferred portions of the Purchase Price provided for under the terms of the SPA.[13]Article 8 of the Deed of Transfer contained an exclusive Italian jurisdiction clause in the following terms:
“Any dispute concerning this agreement, as well as any amendments and/or additions thereto, including, but not limited to, those relatingto its validity, effectiveness, interpretation, execution and termination, shall be referred to the exclusive jurisdiction of the Court of Milan, without prejudice to the mandatory provisions of law.”
The Dispute[14]Prior to the SPA, in August 2023, Niococktails had entered into a letter of intent and a promotional services agreement with the Proximo and the McGregor Entities. As envisaged by the SPA, after completion of the SPA in December 2023, Niococktails entered into discussions with the Proximo and McGregor Entities with a view to terminating these prior agreements. In response, the Proximo and the McGregor Entities threatened to bring claims of up to US$12 million against Niococktails for damages and lost profits. Following negotiations, Nicococktails settled these claims for US$1 million in August 2024. In November 2024, the Claimant gave notice to the Defendant that it intended to set off the settlement amount against the Deferred Payment pursuant to clause 6 of the SPA.[15]In due course, in January 2025, the Claimant paid the Deferred Payment due under the SPA in the sum of €469,992.00. This sum was calculated as the Deferred Payment of €1.25 million less €780,008.00 (being the euro equivalent of the settlement amount) which was withheld by the Claimant pursuant to clause 6 of the SPA. It is this conduct on the part of the Claimant that has given rise to the dispute between the parties. In particular, the Defendant disputed the Claimant’s entitlement to withhold the settlement sum on various grounds (including an allegation that the Claimant had breached clause 5 of the SPA) and, in March 2025, it commenced the Italian proceedings seeking to recover the sum of €780,008.00 which the Defendant contends was wrongfully withheld by the Claimant from the Deferred Payment.[16]Paragraph 1.1 (vii) of the Italian Writ of Summons asserts that the Court of Milan has exclusive jurisdiction over the claims made in the Italian proceedings pursuant to Article 8 of the Deed of Transfer. By contrast, the Claimant maintains that the claims made in the Italian proceedings in fact fall within the exclusive jurisdiction of the English courts pursuant to clause 24 of the SPA.[17]In particular, the Claimant submits that(i) clause 24.2 of the SPA is a binding and exclusive jurisdiction agreement in favour of the English courts;(ii) on their proper construction, clause 24 of the SPA (rather than Article 8 of the Deed of Transfer) governs the subject matter of the dispute in the Italian proceedings;(iii) that the commencement and pursuit of the Italian proceedings constitutes a breach of clause 24 of the SPA by the Defendant; and(iv) there are no strong reasons to refuse to grant an anti-suit injunction against the Defendant. Relevant Principles[18]Clause 24 of the SPA is a jurisdiction agreement to which the 2005 Hague Convention on Choice of Court Agreements applies. By reason of Article 3(b) of that Convention, clause 24 is deemed to be an exclusive jurisdiction clause in favour of the English courts.[19]Where the dispute in question potentially arises under or in connection with one or more jurisdiction clauses in related agreements, it is a question of construction in each case as to which disputes are covered by which jurisdiction clause. The primary focus, therefore, will be on the wording of the relevant clauses but it is unlikely that reasonable commercial parties would have intended that a dispute would be within the scope of two inconsistent jurisdiction clauses. As the editors of Dicey, Morris & Collins on the Conflict of Laws (16th ed. 2022) at paragraph 12-082 explain:
“What is required is a broad, purposive and commercially-minded construction, in the light of the transaction as a whole, taking into account the overall scheme of the agreements and reading sentences and phrases in the context of that overall scheme. This may include enquiring under which or a number of inter-related contractual agreements a dispute actually arises, and seeking to do so by locating its centre of gravity and thus which jurisdiction clause is closer to the claim.”
[20]An exclusive English jurisdiction clause includes not simply a positive obligation to bring any proceedings within its scope in England but a negative obligation not to commence proceedings in any other forum: AES Ust-Kamenogorsk Hydropower Plant LLP v Ust-Kamenogorsk Hydropower Plant JSC[2013] 1 W.L.R. 1889 at [23].[21]The power to grant an anti-suit injunction to enforce an exclusive English jurisdiction agreement arises under section 37 of the Senior Courts Act 1981 and is well established. In summary, as the Claimant accepted, it had to satisfy me to a ‘high degree of probability’ that an exclusive English jurisdiction agreement existed and that the dispute in question fell within its scope. If it does so, the Court will ordinarily exercise its jurisdiction to restrain the pursuit of foreign proceedings unless the Defendant can show ‘strong reasons’ why it should not do so, see (for example): QBE Europe SA/NV v Generali Espana de Seguros y Reaseguros [2022] 2 CLC 389 at [10]. Discussion[22]In my judgment, the central issue that arises on the Claimant’s application for an interim anti-suit injunction is whether the dispute forming the subject matter of the Italian proceedings falls within the scope of clause 24 of the SPA or Article 8 of the Deed of Transfer.[23]As I have explained, the resolution of this issue is essentially a matter of construction. Having had regard to the wording of the SPA and of the Deed of Transfer and to the detailed allegations contained in the Italian Writ of Summons, I have been persuaded (to the requisite standard) that the dispute forming the subject matter of the Italian proceedings falls within the scope of clause 24 of the SPA and not within Article 8 of the Deed of Transfer. Accordingly, it follows that the Italian proceedings have been commenced by the Defendant in breach of contract. I have reached this conclusion for the following principal reasons.[24]First, the SPA contains a comprehensive account of the rights and obligations assumed by both parties in relation to the purchase by the Claimant from the Defendant of the category A share in Niococktails. In particular, the SPA determines the total consideration payable (including the Deferred and Exit Payments) by the Claimant, the indemnities granted by the Defendant and the circumstances and basis on which the Claimant can withhold part of the purchase price. By contrast, the Deed of Transfer is much narrower in scope and, as expressly stated in the SPA, was required “only” for the purposes of section 2470 of the Italian Civil Code. The final sentence of Article 2 of the Deed of Transfer makes clear that the parties obligations in relation to the payment of any further sums additional to the Completion Payment are beyond the scope of the Deed of Transfer and governed by separate agreements (i.e. those contained within the SPA).[25]Secondly, the language of clause 24 of the SPA is broad in scope and confers on the English court exclusive jurisdiction in relation to any claim or dispute arising out of or in connection with the SPA. By contrast, the language of Article 8 of the Deed of Transfer is narrower in scope and gives the Court of Milan exclusive jurisdiction in relation to any dispute concerning the Deed of Transfer.[26]Thirdly, it is clear from the Writ of Summons that the essential complaint underlying all of the Defendant’s claims in the Italian proceedings is that the Claimant failed to pay the Deferred Payment under the SPA in full. The alleged breaches of the terms of the SPA clearly fall within the scope of clause 24 of the SPA. Moreover, even though several claims are formulated by reference to various articles of the Italian Civil Code, the substance of the Defendant’s claims are that the Claimant failed to comply with its obligations under the SPA and acted improperly in withholding the sum of €780,008.00 from the Deferred Payment due under the terms of the SPA.[27]Fourthly, the centre of gravity of the dispute which forms the subject matter of the Italian proceedings falls within the scope of clause 24 of the SPA rather than Article 8 of the Deed of Transfer.[28]In these circumstances, absent strong reasons not to do so, this is a case in which it is just and reasonable to grant the Claimant interim injunctive relief to enforce its rights under clause 24 of the SPA. Having considered the evidence of Ms Cook, I was satisfied that there were no (let alone strong) reasons not to grant the interim injunctive relief sought by the Claimant in this case. Conclusion[29]For all these reasons, in my judgment the Claimant is entitled to an interim anti-suit injunction and I made the order accordingly. All issues as to costs have been reserved to the Judge hearing the application at the return date.

Cited in 1 later judgment