Business

ESB sued over admitted inadvertent disclosure of firm’s pricing structure to competitors

Causeway Geotech claims it will suffer loss and damage as a result

The Four Courts. The Electricity Supply Board is being sued over the admitted inadvertent disclosure of a firm’s confidential pricing structure to four competitors as part of a tender process

Mon Jun 10 2024 - 17:49

The Electricity Supply Board (ESB) is being sued over the admitted inadvertent disclosure of a firm’s confidential pricing structure to four competitors as part of a tender process.

Causeway Geotech Ltd, a ground investigations contractor based in Ballymoney, Co Antrim, has brought High Court proceedings against the ESB and ESB Networks DAC claiming it will suffer loss and damage as a result of the disclosure and affect its chances of success in future tender processes.

In April, Causeway brought proceedings seeking damages for matters including infringement of European Union law on procurement, breach of confidence and wrongful interference with its contractual and/or economic interests.

On Monday, the matter was admitted to the fast-track Commercial Court on the application of Causeway with no objection from the ESB defendants. The case returns in October.

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Causeway carries out ground investigations in advance of planned building projects to reduce and control ground-related risks during construction. It employs 122, operates in Ireland and the UK and forecasts an annual turnover of £50 million (€59 million) by 2030.

In an affidavit, Causeway director Paul Dunlop said the firm was one of a number of companies shortlisted by the ESB for carrying out ground investigations.

In August 2023, the ESB issued a request for tenders under the multi-contractor framework agreement for site investigation services. Causeway submitted its tenders which included its prices for the work which Mr Dunlop said is highly confidential and commercially sensitive.

On February 19 last, the ESB informed Causeway, via the “eTenders” system, that it had completed an initial evaluation of responses.

However, Mr Dunlop said, attached to this message was a zip folder entitled “Causeway.zip” which contained the firm’s pricing information.

Two days later another message was sent via eTenders saying it had come to the ESB’s attention that “due to a technical error, commercially sensitive information was inadvertently disclosed”.

Later that day, ESB said it was pausing the tender process pending an analysis review and on February 29th said it was cancelling the entire process due to “unforeseen circumstances”, Mr Dunlop said.

When Mr Dunlop queried what had happened, he said the ESB eventually responded saying that the Causeway information was “inadvertently issued to other tenderers involved in this competition”.

Mr Dunlop told the ESB this breach of confidentiality meant competitors “have gained an unfair advantage in all future public- and private-sector bidding by tailoring their bids accordingly, eroding our ability to compete on a level playing field”.

In one subsequent email the ESB said it believed it could put measures in place “to de-risk the process”, he said.

Further correspondence followed between Causeway’s lawyers and the ESB including seeking a proposal to compensate the firm. Ultimately, due to time constraints for bringing cases under EU procurement law, proceedings were issued.

Mr Dunlop said the market for ground investigations on the island of Ireland is relatively small with no more than 12 companies competing for work.

The disclosure of its rates to competitors is likely to have a significant impact on the turnover, margin and profitability of Causeway’s business, may also result in redundancies and ultimately put the business at risk of failure, he said.

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