The Principle of State Liability:

Indirect effect requires national courts to interpretate domestic law consistently with directives. National courts must disregard domestic law where there is a conflict with Union law.

Francovich: Italy failed to implement a directive for the protection of employees in the event of insolvency of their employer. Held, member states are obliged to make good damage on individuals caused by breaches of EU law for which the state can be held responsible (article 4(2) TEU). The advocate general suggested that temporal effect should be limited i.e. judgement does not take place to past, only to present and future. This was rejected as previous case law had already implied state liability.
The State must be liable for loss and damage caused to individuals as a result of breaches of Community law.” Member states are required to take all appropriate measures to ensure fulfilment of their obligations under Community Law (Art 288 TFEU). Three conditions for state liability must be met:

the result prescribed by the directive should entail the grant of rights to individuals
it should be possible to identify the contents of those rights on the basis of the provisions of the directive
a causal link existed between the breach of the state’s obligation and the harm suffered by the injured parties

Brassierie du Pécheur & Factortame:
Claims for damages of EU law are brought to national courts whom must make available certain remedies so long as:

Claimant must show infringed EU was meant to enforce rights on individuals,

Infringement must be sufficiently serious

Causal link must exist between the injury to the person and the infringement.

From Article 340 TEU, the principle of state liability cannot be deduced.

Liability of Judicial Institutions: Hedley Lomas: Where to defendant state was not called upon to make any legislative choices and has limited discretion, the mere infringement of Union law may be sufficiently serious to constitute to a breach.

Brinkman: Ban based on concern of treatment of sheep in Spanish warehouses was breached. Failure to give give effect to directive within the time limit automatically constitutes to a sufficiently serious breach. Additionally, if damages are not lain down within the time limit this is a breach in itself. Ie. a mere infringement of Community Law= sufficiently serious breach.

Köbler: Infringement by a national court of last resort for failing to refer an issue to the ECJ. If a national court of last resort delivers a decision as a result of which a party is deprived a a right which union law intended them to enjoy and causes them to suffer loss, he can bring proceeding against the case concerned through the principle of state liability. There must be an infringement of Union Law.
Res judicata prevents individuals from constantly re-litigating the same decision once it had reached the highest court. This does not apply if one is "re-opening" the new case with a completely separate/new claim.

Douglas Scott: "as the Treaty did not infer state liability, the court had left itself open to judicial lawmaking, thus undermining the rule of more."

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state liability in eu law