Law of Equity
A mechanism for collective redress has existed in England for over 200 years. It originated under the law of equity in the chancery courts so that a group of parties with “a common interest and a common grievance” could be represented by one or more members of that group. One of the earliest instances of such an action was where certain creditors of a deceased debtor were able to bring a claim on behalf of all the creditors.
Rules of the Supreme Court
Eventually, towards the end of the 19th century, the Rules of the Supreme Court were introduced to codify the law and to bring the common law and the law of equity in this area, and generally, into line. The rules stated that where there are numerous persons with the “same interest”, one or more of those persons may sue or be sued for the benefit of all the interested persons.
Civil Procedure Rules
While English courts were, and still are, able to use their case management powers to manage a group of claims informally, other formal mechanisms became available following the introduction of the Civil Procedure Rules in 1999 (CPR). The introduction of these mechanisms under the CPR was largely in response to an increase in multiparty litigation throughout the 1980s and 1990s.
Amendments since 2000
Representative actions procedure
Rule 19.6 was added to the CPR in May 2000 and provides for a representative actions procedure which, similar to the earlier Rules of the Supreme Court, permits a party to sue, or be sued, as the representative of a class of individuals, provided that one or more of the persons in that class has the same interest as the representative. Historically, this mechanism has been used infrequently due to the strict interpretation and limited scope of the phrase “the same interest”.
However, it was put under the spotlight by virtue of Lloyd v Google (2021) UKSC 50 (“Lloyd”), a high-profile, large-scale data breach action that came before the UK Supreme Court (UKSC) in April 2021. In its long-awaited judgment handed down on 10 November 2021, the UKSC overturned the ruling of the Court of Appeal, thereby disallowing data privacy actions that require an individual assessment of loss or damage to be brought on an “opt-out” basis pursuant to the representative actions procedure. The UKSC’s decision affirms the court’s stringent approach to the “same interest” test. Subsequent representative actions that had been brought against other global technology companies in relation to alleged breaches of data protection rules were later withdrawn by the claimants due to legal uncertainty around privacy class actions in the wake of Lloyd – see 1.2 Basis for the Legislative Regime, Including Analogous International Laws and 4.4 Class Members, Size and Mechanism (Opt In/Out).
The amendments to the CPR in May 2000 also introduced Group Litigation Orders (GLOs) in response to the perceived inadequacy of the existing collective action mechanisms and in order to allow the court to properly manage claims brought by a large number of claimants whose claims shared common issues of fact and law.
In a similar vein, in 2015, an opt-out collective proceedings regime was established by the Consumer Rights Act 2015 (CRA) for bringing private competition claims in the Competition Appeal Tribunal (CAT) as the existing regime for such claims, which operated on an opt-in basis only, was considered to be too narrow to provide effective redress to claimants. Similar to the representative actions procedure, this regime had been used relatively infrequently, although there has been an increase in applications for collective proceedings order (CPOs) following the UKSC decision in Merricks v Mastercard (2020) UKSC 51 (the "Mastercard litigation"). The UKSC ruled that the matter was suitable for a hearing under the regime and on 18 August 2021 the first-ever CPO, since the introduction of the regime in 2015, was granted by the CAT.
In the above case, the UKSC rationalised the "opt-out" collective proceedings regime by quoting from Judge Posner in a US case: "The realistic alternative to a class action is not 17m individual suits, but zero individual suits, as only a lunatic or a fanatic sues for $30."
Since the UKSC’s decision in the Mastercard litigation, several CPOs have been granted by the CAT, with many of these actions being pursued against global technology companies in relation to alleged breaches of competition law.
Representative actions and GLOs in the UK are not modelled on the regime of any other country, having arisen spontaneously and then been enshrined in law.
The representative action and collective proceedings regimes are similar to the US class action regime as they are opt-out regimes. However, both are more limited in scope than the US class action regime, as representative actions are subject to the “same interest” requirement, and only private competition claims can be brought under the collective proceedings regime.
There is no applicable information in this jurisdiction.
The court can use its case management powers pursuant to CPR 3 to manage claims brought by multiple claimants without the use of a formal mechanism. Multiple claimants can bring their claims by issuing a single claim form against one or more defendants. The court also has power under CPR 3.1 to:
These types of actions are referred to in this chapter as “informal group action mechanisms”.
Test cases may be utilised as part of a GLO, but as noted above, they can also be used outside the GLO regime.
Representative actions are governed by CPR 19.6, while CPR 19.6(1) sets out the “same interest” test outlined above.
The rules governing GLOs are set out in Part III of CPR 19, and Practice Direction 19B. CPR 19.10 defines a GLO as an order “to provide for the case management of claims which give rise to common or related issues of fact or law (the ‘GLO issues’)”.
CPR 19.11 empowers the court to make a GLO where there are, or are likely to be, a number of claims giving rise to the GLO issues and it states that a GLO must:
Collective proceedings before the CAT are governed by the Competition Act 1998 (“CA98”) as amended by the Consumer Rights Act 2015. All referenced sections below are to the CA98.
Section 47B(1) provides that collective proceedings may only be brought before the CAT in relation to two or more claims to which Section 47A applies, namely:
Collective proceedings may continue only if the CAT makes a CPO (Section 47B(4)).
Section 47B(6) provides that claims are eligible for inclusion in collective proceedings “only if the Tribunal considers that they raise the same, similar or related issues of fact or law and are suitable to be brought in collective proceedings”. Pursuant to Section 47B(7), a CPO must include the authorisation of the person who brought the proceedings to act as representative, a description of a class of persons whose claims are eligible for inclusion in the proceedings, and it must specify whether an opt-in or opt-out mechanism is to be used. The CAT may authorise a person to act as the class representative even if the representative does not fall within the class itself, provided that the CAT considers it just and reasonable for that person to be appointed as representative (Section 47B(8)).
Opt-in collective proceedings are defined as collective proceedings which are brought on behalf of each class member who opts in by notifying the representative, in a manner and by a time specified, that the claim should be included in the collective proceedings (Section 47B(10)).
Opt-out collective proceedings are those where any class member can opt out by notifying the representative, in a manner and by a time specified, that the claim should not be included in the collective proceedings, although Section 47B(11)(b) excludes class members who are not domiciled in the UK at the time specified and who do not opt in to the proceedings in a manner and by a time specified.
Schedule 8 of the CRA 2015, the Competition Appeal Tribunal Rules 2015 (“CATR” or the “CAT Guide”) set out the relevant procedure for bringing claims in the CAT, as described in 4.2 Overview of Procedure.
In principle, there is no limitation on the areas of law or types of dispute in relation to which informal group action mechanisms or representative actions can be brought.
In practice, representative actions have, to date, only been brought in a small number of claims, although they have included claims by stallholders seeking to restrain the owner of Covent Garden from overcharging them (Duke of Bedford v Ellis (1901) A.C. 1); ship-owners against a lead underwriter and the subscribing market for payment of sums ordered to be paid under an arbitration agreement (Irish Shipping Ltd v Commercial Union Assurance Co plc (1991) 2 QB 206); by both owners and housing association sub-tenants living in a block of flats, in relation to generic defects in the block (Millharbour Management Ltd v Western Homes (2011) EWHC 661 (TCC)); and, more recently, although so far unsuccessfully, large-scale data breach actions.
GLOs can be brought in respect of claims in a variety of areas, including product liability, shareholders’ actions, pension disputes and financial services. They are frequently brought in relation to product liability claims, often those involving pharmaceuticals and medical devices, care home or school abuse claims, taxation disputes, environmental cases (eg, claims relating to landfill and bad odours), and employment-related personal injuries.
Collective proceedings may be brought in relation to two or more claims for damages, another sum of money, or an injunction in relation to competition claims regarding, among other things, agreements preventing, restricting or distorting competition and abuse of dominant position.
CPR 19.6 defines representative actions as: "Where more than one person has the same interest in a claim (a) the claim may be begun; or (b) the court may order that the claim be continued, by or against one or more of the persons who has the same interest as representatives of any other persons who have that interest."
The term “same interest” has been considered by the courts on numerous occasions in cases going back over 100 years. The Court of Appeal’s judgment in Jalla v Shell International Trading and Shipping Co Ltd (2021) EWCA Civ 1389, sets out the following requirements and limitations with regard to representative actions, which also includes a helpful summary of the relevant case law.
The UKSC's judgment in Lloyd v Google (2021) provides clarity on the interpretation of the “same interest” requirement in the context of large-scale data breach actions. In this action, Mr Lloyd brought a claim against Google alleging that it had breached its duty as a data controller under the old Data Protection Act 1998 (DPA 1998) by tracking the internet activity of Apple iPhone users, without their knowledge, and thereafter selling the acquired data. Mr Lloyd brought a representative action on behalf of the class of affected iPhone users (estimated to be approximately 4.4 million), claiming damage for distress and anxiety in relation to the loss of control of the data. The Court of Appeal held that (i) damages are, in principle, capable of being awarded for loss of control of data, even where there is no pecuniary loss or distress suffered by an individual claimant; and (ii) Mr Lloyd met the requirements of a representative action on the basis that those he sought to represent did have the “same interest”. The Court of Appeal held that “the data in possession of Google will be able to identify who is, and who is not, in the class”.
Google appealed to the UKSC, which unanimously allowed the appeal. The UKSC held that to bring a claim for compensatory damages for a breach of the DPA 1998, a claimant must establish that there has been a breach, and that damage, in the form of material damage or distress, has been suffered as a result. As this would involve an assessment of individual damages and loss, the claim could not proceed as a representative action under CPR 19.6 as the “same interest” requirement had not been met.
In cases requiring an individual assessment of damages, the UKSC suggested that the representative action procedure could still be used to determine common issues of fact or law, leaving issues that require individual determination to be dealt with subsequently.
CPR 19.10 defines a GLO as: "an order made under rule 19.11 to provide for the case management of claims which give rise to common or related issues of fact or law (the 'GLO issues')".
CPR 19.11 gives the court the discretion to make a GLO when “there are or are likely to be a number of claims giving rise to the GLO issues”. The granting of a GLO is at the discretion of the court rather than the parties’ right. The court may set up a GLO of its own volition.
There is no minimum number of claims required before the court can grant a GLO: it must be “far more than two” (Alyson Austin v Miller Argent (South Wales) Limited (2011) EWCA Civ 928) but can be fewer than 20 (The Corby Group Litigation).
The test of “common or related issues” is not as narrow as the “same interest” test for representative actions. By way of example, the following were found to fulfil the test:
The following were found not to be suitable for a GLO:
Despite the GLO regime being introduced over 20 years ago, only 110 GLOs have been authorised by the court, of which, just 32 were granted between 2012 and 2022.
Section 47B(6) of CA98 states that claims are eligible for inclusion in collective proceedings “only if the Tribunal considers that they raise the same, similar or related issues of fact or law and are suitable to be brought in collective proceedings”.
This is supplemented by rule 79(1) of the CATR which states that the CAT must be satisfied that the claims “are brought on behalf of an identifiable class of persons... raise common issues... and... are suitable to be brought in collective proceedings”.
When deciding whether the claims are suitable, the CAT takes into account all matters it sees fit, including a number of specific matters:
This definition was recently interpreted by the Supreme Court, and applied by the CAT, in the Mastercard litigation, which made the following findings.
It should be noted that the claimants in the Mastercard litigation already had a finding of breach of statutory duty in their favour which may have assisted their case for collective proceedings.
The various mechanisms for bringing a collective redress/class action in the UK have already been described, but are summarised here.
In England and Wales
Across the UK
Section 47B of the CA98, as amended by Schedule 8, paragraph 5 of the Consumer Rights Act 2015, enables consumers and businesses to bring collective proceedings in the CAT in relation to infringements of UK competition law that raise “the same, similar, or related issues of fact or law” (rules 79(1)(b) and 73(2) CATR).
Informal Group Action Mechanisms
There is no specific or special procedure governing claims pursuant to informal group action mechanisms. As set out in 1.1 History and Policy Drivers of the Legislative Regime, the courts will use their case management powers under the CPR to manage claims brought by multiple claimants, which will give the courts flexibility and control over the litigation.
Other than that set out in CPR 19.6 and discussed in previous answers, there are no other specific rules governing the procedure of representative actions.
Practice Direction 19B sets out the procedure for applying for a GLO, the operation of the group register and how the GLO will be managed by the court.
Individual claimants are required to issue their own respective claim forms and apply to join the group register. If a party applies to the court seeking approval for a GLO, a claimant must demonstrate that there are “common related issues of fact or law”.
Where appropriate, the court may make a GLO of its own initiative. For example, in Dominic Lis Waniso Lungowe & ors v Vedanta Resources PLC & anor (2020) EWHC 749 (TCC), the court, of its own volition, made a GLO in circumstances where two claimant law firms commenced separate proceedings for two sets of claimants. Both proceedings shared common issues of fact and law and were therefore suitable for a GLO. Accordingly, Mr Justice Fraser held that the defendant should only have to deal with one single set of proceedings and not two considerable-sized ones.
GLOs benefit from active case management by the court. Upon the granting of a GLO, a case management conference will be fixed at which the court may give directions:
The group register is usually maintained and kept at the court but the court may direct that solicitors for one of the parties take responsibility for it.
GLOs are automatically allocated to the multi-track, which is the track suited to high-value, complex and multiparty litigation. A managing judge will be appointed to manage the GLO and hear the GLO issues. To support the judge with the administration of a GLO, a master or district judge may also be appointed to deal with procedural matters in accordance with directions given by the judge. A costs judge may also be appointed, particularly if the GLO is subject to costs budgeting.
Collective proceedings are a form of procedure and do not establish a new cause of action; each individual claim must be a claim to which Section 47A of the CA98 applies (see 2.1 Collective Redress and Class Action Legislation).
Collective proceedings are governed by rules 75–93 of the CATR. There are four stages to a collective proceedings action:
Unlike ordinary civil proceedings under Section 47A of the CA98, collective proceedings must be approved by the CAT, with such approval comprising authorisation of the class representative and certification of the claim as eligible for inclusion in collective proceedings. The claim can only proceed if a CPO is issued by the CAT.
Similar to GLOs, collective proceedings (particularly under the opt-out regime) are subject to intensive case management by the CAT so as to ensure that the interests of the CAT are adequately protected.
There is also a procedure governing collective settlements, which is described in further detail in 4.12 Settlement and ADR Mechanisms.
Informal Group Action Mechanisms and GLOs
There are no rules or restrictions on standing, where multiple claims are managed by way of informal group action mechanisms or a GLO. Claimants are to commence their own individual actions, before they are managed in accordance with these mechanisms.
In certain GLOs, it may be appropriate for the court to select a sample of the claimant group to act as test claims that will give rise to sufficient common findings to apply to the remaining cohort of claimants.
In contrast, a representative action must be brought by, or against, one or more persons who have the “same interest” in a claim, as discussed in 1.1 History and Policy Drivers of the Legislative Regime.
Collective actions brought in the CAT may be brought by a claimant, or a class representative who need not be a class member. The class representative must be certified by the CAT before it is permitted to commence proceedings. In so doing, the CAT will consider whether it is just and reasonable for the class representative to be appointed, having regard to specific criteria, including whether the proposed CAT representative would fairly and adequately act in the interests of the class members and to ensure that, in relation to the common issues of the class members, it does not have a material interest that is in conflict with the interests of the class members.
In determining whether the proposed class representative will act fairly and adequately in the interests of the class members, the CAT will have regard to a number of circumstances, including:
Informal Group Action Mechanisms
These procedures operate on an opt-in basis, meaning that claims are brought on behalf of identified claimants who have authorised the claims to be brought on their behalf. There are no limits on the number of claimants using these mechanisms. Indeed, they have been used to manage claims brought by very large numbers of claimants.
In Weir v Secretary of State for Transport (No1) (2005) EWHC 812 (Ch), approximately 48,000 shareholders of Railtrack brought an action against Stephen John Byers, the then Secretary of State for Transport, in relation to his decision to force Railtrack into administration. A group of claimants formed an "action committee" which brought a single action in which the 48,000 shareholders were all parties to the proceedings.
Parties whose claim gives rise to the GLO issues must issue a claim and be entered into the group register to be part of the GLO. There is no limit on the number of eligible claimants that may join the group, although the court may give directions that specify a cut-off date after which no claim may be added to the group register unless the court gives permission (CPR 19.13).
There is no limit to the number of eligible claimants that may join a representative action.
Representative actions are based on an opt-out regime. An opt-out action is one that is brought on behalf of those who fall within the class, unless they express their wish not to be represented.
There is no requirement for the represented class to be joined as parties to the action, or to be identified individually. Any judgment or order made by the court is binding on all persons represented in the claim but may only be enforced by or against a person who is not a party to the claim with the permission of the court.
Collective Proceedings in the CAT
Collective proceedings can be brought on either an opt-in or opt-out basis. Historically, collective actions brought in the CAT were only conducted on an opt-in basis. However, this changed following the introduction of the CRA in October 2015, which provides for an opt-out regime. A CPO will state whether the collective proceedings are opt in or opt out and specify the time and manner by which, in the case of opt-in collective proceedings, a class member may opt in and, in the case of opt-out collective proceedings, a class member who is domiciled in the UK on the domicile date may opt out.
Parties can be added to an issued claim form although the court’s permission is required if the claim form has been served (CPR 19.4(1)).
See 4.4 Class Members, Size and Mechanism (Opt In/Out) which notes that there is no limit on the number of eligible claimants that may join a GLO or representative action.
For collective proceedings, an application can be made to the CAT for permission to add a party to the proceedings (Rule 38 CATR). An application for permission must be served on all the parties and may be made by an existing party or a person who wishes to become a party. Before the expiry of the relevant limitation period, the CAT may order a person to be added as a new party if adding that party can aid the CAT to resolve the matters in dispute, or if there is an issue involving the new party and an existing party that is related to the matters in dispute.
The court’s case management powers under CPR 3 are described in the responses above and apply generally to the informal group action mechanisms, GLOs and representative action procedures.
GLOs are subject to more stringent case management by the court. In addition to the case management powers provided by CPR 3, the court is empowered to give directions, including varying the GLO issues, providing for one or more claims on the group register to proceed as test claims and appointing the solicitor of one or more parties to be the lead solicitor for the claimants or defendants (CPR 19.13). Where the court has given directions for a claim or claims in the group register to proceed as a test claim to address a specific issue or fact or law, the outcome will be applied to the cohort of remaining claims. Should a test claim be resolved, the court may order that another claim in the group register be substituted as the test claim.
As with GLOs, collective proceedings are subject to extensive case management. The CAT has broad case management powers and may, at any time, give directions for case management, order similar claims to be heard together, and add or substitute parties. It also has the power to strike out claims.
The length and timetable for group actions and collective proceedings brought in the court or the CAT is subject to various factors, including the number of parties, the complexity of the issues, the volume of factual and expert evidence, and the collective value of the claims.
Although representative actions are few and far between, recent actions have lasted several years. In Jalla & Others v Shell, the Court of Appeal’s judgment was handed down in September 2021, nearly four years after the commencement of proceedings.
GLOs have also been known to span several years. For example, the DePuy Pinnacle Metal on Metal Hip Group Litigation Order was granted on 31 July 2014 but the trial did not commence until October 2017. The trial was listed for the entire Michaelmas term (four months), with judgment handed down in May 2018.
Collective proceedings are less drawn out as the procedure is more streamlined in accordance with the CATR. Where appropriate, certain collective proceedings may be appropriate for the CAT’s fast-track procedure. Rule 58 of the CATR empowers the CAT to make an order, either on application by a party or on its own initiative, that the proceedings be subject to the fast-track procedure. In determining whether the fast-track procedure is suitable, the CAT will take into account all relevant circumstances, including:
Acceleration of Claims
While the courts in England and Wales operate quickly in comparison with many other jurisdictions, litigation can span several years. In accordance with the overriding objective, the court has a duty to actively manage cases to ensure that they are dealt with expeditiously and fairly. However, in circumstances of real urgency, the court can order an expedited trial. When considering an application for an expedited trial, the court will have regard to:
The CAT provides for a fast-track procedure as described above.
The court can use its case management powers to:
The CAT has similar powers pursuant to rules 41–43 of the CATR.
Informal group action mechanisms, GLOs and representative actions
CPR 44 sets out the rules governing costs in England and Wales. The court has discretion to award a party costs, the amount of those costs and when they are to be paid (CPR 44.2). Costs may be awarded on a "standard basis", ie, costs are recoverable only in so far as they are reasonably incurred and proportionate to the issues, or on an indemnity basis, ie, they are presumed to be reasonably incurred and proportionate.
The general rule is that the losing party pays the costs of the successful party, in addition to bearing their own costs. Given the significant costs typically generated by group actions, this general rule has been a factor in deterring unmeritorious group actions being pursued through the courts.
Parties to group actions brought in the High Court after 1 April 2013 may be required to submit a costs budget. In the context of a complex group action, these can be subject to intense scrutiny by the court. In Maurice Hutson & Ors v Tata Steel UK Ltd (2020) EWHC 771 (QB) which involved a GLO of more than 300 claimants, the High Court rejected an application by the claimants to retrospectively revise a previously approved costs budget and reduced a future budget by more than half.
In addition to the general rules on costs, there are specific rules for GLOs set out in CPR 46.6. GLOs will generate individual costs, being the costs incurred in relation to an individual claim on the group register, and common costs, which comprise:
Generally, group litigants on the register are severally liable in respect of an order for common costs, with each litigant bearing an equal proportion of the common costs, unless the court orders otherwise.
In addition to their share of the common costs, group litigants are also liable for the costs of their own individual, respective claims.
Like the court, the CAT has discretion as to costs and at any stage of the proceedings may make an order it considers fit in relation to payment of costs for the whole or part of the proceedings. In making such an order, and to determine the amount of costs, the CAT may take into account:
Third-party litigation funders who have provided funding to losing claimants may be liable to pay significant litigation costs. In Sharp and others v Blank and others (2020) EWHC 1870 (Ch), the court ruled that the funder was jointly and severally liable for the defendants’ costs in shareholder litigation subject to a GLO and ordered it to pay GBP17 million.
There are various methods of funding available to claimants in England and Wales.
Third-party litigation funding
While these funding methods continue to be available to claimants bringing group actions, the emergence of third-party litigation funding (TPLF) over recent years and, in particular, the proliferation of US funders in England and Wales, has resulted in an increase in group actions being funded on this basis.
In the Volkswagen emissions litigation (Crossley & Ors v Volkswagen Atkiengesellschaft & Ors (2019) EWHC 783 (QB)), discussed below, lawyers representing over approximately 91,000 claimants obtained funding via Therium Capital Management, a global provider of litigation finance and arbitration funding. Similarly, Mr Merricks in the Mastercard litigation, and other actions pursued in the CATs, are also supported by litigation funders.
The increased availability of such funding – coupled with what appears to be a cultural shift by claimants in favouring it over traditional methods – can be said, among other factors (such as the increasing presence of US law firms with class action expertise) to have facilitated the proliferation of group actions brought in England and Wales in recent years.
TPLF is self-regulated by the Association of Litigation Funders. Nevertheless, TPLF arrangements will be subject to close scrutiny by the court. In the Mastercard litigation, the CAT was keen to ensure that the proceedings were to be conducted in the best interests of the class members, which should prevail over the interests of the funder, while at the same time recognising that the funder is entitled to protect its legitimate commercial interests. The CAT independently scrutinised the funding agreement, particularly in relation to provisions that permitted the funder to terminate the agreement where it considered that the proceedings were no longer commercially viable. The CAT was concerned that this put Mr Merricks at risk of his funding arrangements being terminated during the course of the proceedings and ruled that the terms of the funding agreement should include a requirement that the funders' views had to be based on independent legal and expert advice.
Furthermore, the CAT considered the ability of the proposed class representative to pay any adverse costs order made against it and ruled that Mr Merricks should be authorised as the class representative, providing that his litigation funders provided a suitable undertaking to Mastercard that they would discharge a liability for costs ordered against Mr Merricks.
The disclosure of documents forms part of all civil claims brought in England and Wales and is governed by the rules of civil procedure. Although there are no specific or special rules governing disclosure in group or collective actions, the ordinary disclosure rules provide the court and CAT with the necessary flexibility to determine how disclosure is to be managed in group and collective actions, which are often complex in nature and involve multiple parties.
The court and CAT have power to order pre-action disclosure where the applicant can demonstrate that they and the respondent are likely to be a party to subsequent proceedings and that disclosure sought extends to the documents, or classes of documents, that would have been provided by the respondent by way of standard disclosure, had the proceedings started. Standard disclosure requires a party to disclose the documents on which it relies and the documents which adversely affect its own case or another party’s case, or support another party’s case.
The applicant must also demonstrate that the provision of pre-action disclosure will:
Disclosure during proceedings
For informal group action mechanisms, GLOs and representative actions brought in court, once proceedings are issued, the court may make an order for either standard or specific disclosure. A party’s duty of disclosure is limited to documents which are or have been in their control. When giving standard disclosure, a party is required to conduct a reasonable search for documents, with the "reasonableness" of the search determined by the number of documents involved, the nature and complexity of the proceedings, the ease and expense of retrieval of any particular document, and the significance of any document located.
For collective proceedings brought in the CAT, the CAT will decide at a first case management conference whether and when a disclosure report and Electronic Documents Questionnaire should be filed. At a subsequent case management conference, the CAT will decide what orders to make for disclosure, having regard to the need to limit disclosure to that which is necessary to deal with the case justly. At any point, the CAT may give directions as to how disclosure should be given, including the nature of the searches to be undertaken, whether lists of documents are required, the format in which the documents are to be disclosed and whether disclosure is to take place in stages.
Although the rules governing disclosure in the court and CAT are similar, their application varies between the different regimes. For example, since the represented class in a representative action is not party to the proceedings, the members of the class are regarded as third parties for the purposes of disclosure. Accordingly, the represented class is not subject to the usual standards of disclosure and will be subject to the specific requirements governing disclosure by third parties (CPR 31.17).
The CAT has power to order disclosure to be given by any party to the proceedings, the class representative and any represented person to any other represented person (including a person within a different sub-class), the class representative or the defendant, on any terms it deems fit.
There are no special or specific rules governing privilege in group or collective action proceedings so the standard rules governing privilege apply.
Parties can withhold documents from inspection on grounds of legal professional privilege. This comprises:
Parties may disclose a privileged document to a co-party or a third party on grounds of "common interest privilege" where the co-party or third party has a common interest in the claim.
Parties can also withhold "without prejudice" communications which were produced as part of a genuine attempt to resolve issues in dispute.
The types of remedies and relief available will depend on the type of action brought, as well as the basis of the claim.
Broadly, the following remedies are available to claimants in all aforementioned group action regimes brought in England and Wales, save as noted below.
Remedies – Application to Group Action Regimes
In Lloyd v Google (2021), the UKSC held that the potential for claiming damages in a representative action is limited by the nature of the remedy of damages at common law, ie, to put the individual claimant in the same position as if the wrong had not occurred. As this requires an individual assessment of loss and damage that raises no common issue and cannot be carried out without the participation in the proceedings of the individuals concerned, the representative action procedure is not the correct mechanism for bringing such claims.
Although a GLO may have addressed common issues of fact or law relating to the losses claimed by the claimants, damages are calculated on an individual basis for each claimant. Damages are not awarded on a combined basis, nor are they aggregated.
Damages can be awarded on an aggregate basis, either by way of a lump sum or by reference to a formula to determine the sum due to each claimant, without requiring individual claimants to prove their losses. Punitive damages may not be awarded in collective proceedings. The CAT does not have jurisdiction to grant declaratory relief.
There is no cap on the level of damages awarded by the court in any of the above group action mechanisms.
As for all civil cases, ADR is available for all types of group actions. Forms of ADR may include mediation or informal without-prejudice round table meetings between the class representatives and defendants.
During the course of proceedings, parties are encouraged to consider the possibility of ADR and settlement. The overriding objective (CPR 1) provides that the court must actively manage cases by encouraging parties to use an ADR procedure if the court considers this appropriate, and facilitating the use of such procedure.
The CPR Practice Direction on Pre-action Conduct and Protocols also states that before commencing proceedings, the court will expect the parties to have exchanged sufficient information to understand each other’s position, to try to settle the issues without proceedings, consider a form of ADR to assist with settlement and reduce the costs of resolving the dispute. Litigation should be a last resort.
Where appropriate, the court may order that the parties take steps to engage in ADR. A party may risk adverse costs consequences for unreasonably refusing to engage in ADR.
While the CATR do not expressly provide that the class representative or class members engage in pre-action ADR, they state that the CAT may encourage and facilitate the use of an ADR procedure if it considers it appropriate to do so. Furthermore, the CATR provide that:
Settlement of claims subject to a GLO and representative actions is no different to settlement in ordinary, individual civil claims brought in the court. Generally, the CPR contains no express provisions or guidance in relation to the management of settlements or settlement agreements.
To the contrary, the CA98 contains express provisions governing settlement in both opt-in and opt-out collective proceedings brought in the CAT.
A judgment issued by the court in an informally managed group action will be binding on all named parties to the proceedings.
A judgment issued by the court in respect of a GLO issue will be binding on all other claims on the group register, unless otherwise ordered by the court. A claimant who was entered on the group register post judgment may apply to the court for an order that the judgment is not binding on them. The court may also give directions as to the extent to which a judgment or order is binding on parties to any claim that is subsequently added to the group register. Parties have the power under CPR 19.12(3) to appeal any judgment or order if they consider that they are adversely affected by it.
Similarly, unless the court directs otherwise, any judgment given in a representative action is binding on all persons represented in the claim, but it may only be enforced by or against a person who is not a party to the claim with the permission of the court (CPR 19.6(4)).
A judgment made by the CAT in collective proceedings may specify the sub-class of represented persons or individual represented persons to whom it does not apply. The class represented is required to give notice of any judgment to all represented persons in a manner approved by the CAT.
There are growing calls from claimant law firms and consumer action groups for a generic opt-out class action regime beyond the scope of competition law claims in the CAT. However, in light of the developments noted in 5.2 Legislative Reform, these calls are likely to go unanswered in the short term.
Nevertheless, there has been a marked increase in group actions in recent years and an apparent willingness of the courts to approve such actions, including those pursued by foreign claimants seeking redress from UK parents companies in respect of the actions of their foreign subsidiaries. An example is the recent decision of the Court of Appeal in Municipio de Mariana v BHP Group UK Ltd (formerly BHP Group Plc) & another (2022) EWCA Civ 951 in which the court granted permission for more than 200,000 Brazilian claimants to proceed with their claims against the defendant UK parent company arising from the catastrophic collapse of the Fundão Dam in South-East Brazil.
On 20 July 2021, the Department of Business, Energy and Industrial Strategy (BEIS) published a consultation, “Reforming competition and consumer policy”, to assess, among other things, whether there is a case for strengthening the UK’s collective redress regime. However, as noted in the government’s response published in April 2022, given the differing perspectives presented during the consultation, the government does not intend to take any action in relation to the UK’s collective redress regime, save for extending the CAT’s jurisdiction to grant declaratory relief.
As a result of Brexit, the UK will not be required to implement the Directive of the European Parliament and of the Council on representative actions for the protection of the collective interests of consumers (2020/1828) into UK national law.
Nevertheless, it is clear that the UK is following in the same direction of travel as the EU, as there has been a marked increase in group actions in recent years, as well as a drive towards widening the scope of opt-out actions in the UK.
The depth and scale of disruption caused by the COVID-19 pandemic across all business sectors globally has undoubtedly given rise to an environment conducive to class actions, particularly in the UK where large-scale, opt-out US-style class actions are becoming more widely available. This is further fuelled by US law firms, in tandem with sophisticated third-party litigation funders, establishing themselves in the UK and harvesting support for group actions.
However, it is not apparent that there has been a sudden proliferation of group actions or any indication of legislative reform in this area specifically arising from the pandemic.
Although we are yet to see any sudden proliferation of group actions arising from the pandemic, it is quite possible that they may come to fruition in due course.
With many businesses forced to operate remotely and online for a significant period of time, as well as restrictions on the supply of goods, there has been significantly increased use and reliance upon data-driven technologies. This has the potential to give rise to large-scale cyber and data breach actions, for which there is certainly a growing appetite. In this regard, although the UKSC’s ruling in Lloyd v Google (2021) has abated this risk for the time being, the UKSC made it clear that its decision was made with consideration to the DPA 1998 only, leaving it open for claimants to attempt to bring future, similar data privacy claims arising from breaches of the GDPR pursuant to the representative action procedure. Claimants and their funders may also be tempted to test whether the CAT may be willing to hear data privacy actions within the collective proceedings regime given the inextricable link between the use of data and the activities of companies operating in the "Big Tech" market. This link is being borne out in new initiatives and regulation such as the UK’s proposal for a new pro-competition regime for digital markets and its Plan for Digital Regulation.
Looking ahead, the turbulent geopolitical climate, the instability of the global economy and an increase in ESG risks may also give rise to group actions in other areas, including the environment, employment, competition, securities and supply chains.
Distinctive UK Collective Redress Schemes
As outlined in the EU chapter of this guide, sweeping reform in this area has seen the EU Directive (2020/1828) on representative actions for the protection of the collective interests of consumers (the "EU Collective Redress Directive") establish an EU-wide mechanism for collective redress which has never before been in place. The Directive was published in the Official Journal on 4 December 2020.
This EU regime was not implemented by the UK prior to its departure from the EU, and will not be transposed into UK national law. The UK’s system is therefore unique among its neighbouring European countries.
The below-mentioned historical mechanisms for collective redress will continue to be the mainstay mechanism in the UK for the time being, in contrast to the EU regime currently being implemented into local laws by EU member states.
In the UK, there are several avenues for pursuing multiparty litigation, including the three main formal mechanisms as follows.
There are several distinctive features of UK collective redress mechanisms.
All those in relevant industries who may find themselves at risk of collective group action, including manufacturers, hospitality management organisations and airlines, should be aware of these trends for future-proofing their businesses, particularly in terms of minimisation of legal risks where possible. Consumers and those in the wider general public who may seek to utilise the growing opportunities offered by the various legislative frameworks should be aware of their rights under these mechanisms.
Representative actions under Part 19.6 of the CPR are proving to be an increasingly popular route by which claims may be brought on an opt-out basis for damages stemming from breaches of data protection law.
The case of Lloyd v Google (2019), a data breach claim, is credited with breathing life back into a mechanism that has long existed but seldom been utilised. Mr Lloyd brought the action in relation to Google’s “Safari Workaround” used in 2011 and 2012, which he alleged allowed tracking and collection of information from phone users’ browser-generated information without their knowledge or consent. In bringing the action, Mr Lloyd is not alleging he or any claimant suffered any financial loss or distress, which is a key issue in this claim. At first instance, the court declined to permit the representative action to proceed on the basis that the members of the class did not have the “same interest”, because they were likely to have suffered different types of damage, if any, depending on their individual circumstances. In addition, the court felt that there would be significant issues in verifying whether any given individual fell within the class.
Following Mr Lloyd’s appeal, the Court of Appeal (CA) permitted the use of the opt-out representative action procedure, reversing the lower court’s decision that the action had not met the requirements of a representative action and granting Mr Lloyd permission to serve a representative action on Google in the US on behalf of approximately 4.4 million iPhone users.
Google’s appeal of the CA’s decision was heard by the UK Supreme Court (UKSC) at the end of April 2021 when the court was asked to determine three key issues, the latter two being relevant to collective redress mechanisms more generally:
The UKSC held that to bring a claim for compensatory damages for a breach of the DPA 1998, a claimant must establish that there has been a breach, and that damage – in the form of material damage or distress – has been suffered as a result. As this would involve an assessment of individual damages and loss, the claim could not proceed as a representative action under CPR 19.6 as the “same interest” requirement had not been met. In cases requiring an individual assessment of damages, the UKSC suggested that the representative action procedure could still be used to determine common issues of fact or law, leaving issues that require individual determination to be dealt with subsequently, and that future claims arising under the UK GDPR regime might be decided differently. Claimants have since sought to further test the court’s resolve in respect of the representative action procedure, with subsequent representative actions being pursued against big tech companies, although these actions were subsequently withdrawn due to legal uncertainty over data privacy litigation in the wake of Lloyd.
In August 2021, after initially refusing to grant a CPO to allow a collective action to proceed, the CAT re-considered Mr Merricks’ application and approved certification of the class in the Merricks v Mastercard (2021) CAT 28 competition action, allowing the claim to proceed as a collective proceeding. The case concerns the claim that Mastercard contravened competition law for almost 16 years by charging excessive "interchange fees" – fees paid by businesses when transactions are made using a Mastercard – which ultimately, it is alleged, resulted in higher prices being charged to consumers. The claim was brought on behalf of all UK shoppers – unless they choose to opt out – and will affect anyone who was living in the UK and of working age between 1992 and 2008, even if they did not have a Mastercard. The claim is worth approximately GBP14 billion. Arguably, the CAT certification has potentially opened the floodgates for similar large-scale competition actions and has set a precedent for what is potentially the largest damages award in legal history.
Although the collective proceedings regime is currently only available for private competition claims, in light of the EU Collective Redress Directive and the outcome in certification of the Merricks case, CPO legislators in England and Wales may be forced to consider widening the scope of the collective proceedings regime to allow other types of claims to be pursued by this, or a similar mechanism, to ensure the framework in England and Wales continues to travel in the same direction as the EU.
Group Litigation Orders
To date, 109 GLOs have been ordered, in cases ranging from tax litigation to medical negligence to child abuse. Historically, the mechanism has received some criticism, however it continues to provide the main procedure for determining a large number of disputes concurrently. While it is likely that GLOs will continue to provide the main process by which large numbers of affected claimants conduct court proceedings in the UK for the foreseeable future, those seeking to make use of this mechanism should be aware of the pitfalls of making an application for a GLO prematurely. As seen in the case of Waterfield v Dentality Ltd (Dentality @Hoddeston) (2020) 8 WLUK 90, courts remain quick to dismiss applications for GLOs that they deem to be “inadequate and premature”, particularly in circumstances where actionable loss has not been satisfactorily proven and it is not clear if the claimants seriously intend to proceed to litigation.
"Dieselgate" and Claims Against Original Equipment Manufacturers (OEMs)
The so-called "dieselgate" litigation has captured the attention of many claimants and claimant law firms across Europe over the past several years and continues to gain momentum. Claims have been and continue to be brought against various OEMs.
The principal issue against OEMs centres around allegations of installation of so-called "defeat devices", allegedly installed to help vehicles "defeat" emissions tests. For example, the "defeat device" allegedly inserted in vehicles manufactured by the Volkswagen (VW) group was a programme in the engine software that allowed vehicles to perceive if they were being driven under test conditions by measuring conditions associated with a driving test, such as distance, speed and even the position of the wheel, and utilise anti-pollution measures accordingly. Similarly, software in Mercedes-Benz engines is alleged to have activated a special temperature control, referred to as a "thermal window", allowing the coolant circuit to be kept artificially cooler and delaying the warm-up of the engine oil. This resulted in nitrogen oxide (NOx) levels remaining below the legal limit for emissions testing, while in normal driving conditions, the software would deactivate, allegedly allowing emissions levels to surpass legal limits.
In England, the first dieselgate claims were brought against the Volkswagen (VW) group (owner of Audi, Seat, Škoda and VW brands) on behalf of over 90,000 affected car owners, including individuals and businesses, for vehicles with EA189 engines, allegedly fitted with unlawful "defeat devices" that cheated EU emissions tests. In May 2018, the High Court granted a GLO on this matter with the trial of the GLO issues scheduled for January 2023, to address the defining issues, including:
In May 2022, this action resolved in an out-of-court, GBP193 million settlement with the affected vehicle owners.
In July 2021, another dieselgate claim was issued in the High Court against the VW group. This claim potentially covers a much bigger group of affected cars, including some Porsche vehicles. Several sets of proceedings have also been issued against Mercedes-Benz in response to the recall order issued by the German road vehicle authority, the KBA, in June 2018. In addition, claims have now been issued against Fiat Chrysler, Nissan, Renault, Ford, PSA (Peugeot Citroën), Vauxhall and Jaguar Land Rover.
Claimant law firms have also been asking consumers of other brands including BMW, MINI, Volvo, Kia and Hyundai to register their interest in potential claims for similar emissions concerns and it is therefore anticipated that further applications for GLOs will follow in due course.
While the UK has played host to this recent surge in momentum, the emissions litigation is also part of a wider trend, with various claims against OEMs having been made across Europe.
Over recent years, there has been an increase in foreign claimants pursuing group litigation in the UK.
As discussed further here, this is in part attributable to the increased availability of third-party litigation funding, allowing more claimants to pursue group litigation where they would otherwise face financial difficulty in doing so within their own jurisdiction. It is also arguable that the overseas claimants may be attracted to the increasingly sophisticated regime in the UK that allows claimants more opportunities to seek collective redress than those offered within other jurisdictions.
Of note is the UKSC decision in Okpabi and others v Royal Dutch Shell Plc and another (2021) in which a group of Nigerian claimants brought an action in respect of environmental damage as a result of oil leaks from pipelines and associated infrastructure operated in and around the Niger Delta by Shell Petroleum Company of Nigeria Limited (“SPDC”). The UKSC addressed whether the claimants had an arguable case that Royal Dutch Shell owed them a common-law duty of care in order to ground jurisdiction against the foreign subsidiary, SPDC, as a necessary and proper party to the proceedings. The UKSC allowed the appeal, clearing the way for the claim to proceed to a full trial in England and Wales. A similar issue was addressed by the UKSC in Lungowe v Vedanta Resources plc (2019) UKSC 20. More recently, the Court of Appeal in Municipio de Mariana v BHP Group UK Ltd (formerly BHP Group Plc) and another, (2022) EWCA Civ 951, granted permission for more than 200,000 Brazilian claimants to proceed with their claims against the defendant UK parent company, arising from the catastrophic collapse of the Fundão Dam in South East Brazil.
Against the backdrop of a growing, global trend of ESG-related litigation, these actions are demonstrative of the English courts’ willingness to entertain mass tort environmental actions brought by foreign claimants against UK parent companies, as well as their reluctance to allow the procedural and case management difficulties that typically arise in collective actions to hinder such actions from proceeding through the English legal system.
US Law Firms
There has been a notable uptick in US law firms experienced in class action procedures setting up shop in the UK. These UK-based US firms have been and continue to be involved in several high-profile UK group actions, including:
Third-Party Litigation Funding
Previous restrictions on litigation funding have meant that, in the past, there have been few high-profile product liability actions in the UK, as claimants have historically relied on conditional fee agreements and after-the-event insurance as a means of pursuing any claim.
With the backing of newly established US law firms, and in correlation with the growing appetite for collective redress, the UK has also seen a proliferation of third-party litigation funders in recent years. England and Wales is the first and only jurisdiction globally to have a code of conduct for litigation funding, authored and enforced by the Association of Litigation Funders (ALF). With this comes a rich diversity of funding companies, notably based in London, offering funding services to a variety of collective actions.
The increase in utilisation of third-party funding has seen the cost of capital become less expensive for litigation funders as more funders use insurance protection, issue corporate bonds and deploy debt structures to raise money on better terms. While litigation funding is arguably not yet a mainstream source of finance, the volume of transactions and expansion of opportunities have facilitated the development of a multibillion-pound global market and consequently, the fees required of litigants themselves have dropped. The availability of such litigation funding and lower associated costs, coupled with the expansion of opt-out group action mechanisms, are now key factors that are encouraging claimants to pursue litigation in England and Wales as opposed to other jurisdictions where the cash flow barrier is significantly higher and therefore obstructive.
ESG-Related Class Actions
Environmental, social and governance issues continue to dominate corporate agendas. In particular, businesses across all sectors are subject to increasing scrutiny by consumers and regulators in relation to the actions they are taking to tackle other ESG-related issues such as climate change, human rights and diversity and inclusion. This is borne out in the EC’s proposals for a Directive 2022/0051 on Corporate Sustainability Due Diligence, which provides a pathway for companies, in respect of their products’ life cycle and/or their business activities, to implement the necessary due diligence procedures to enable them to better identify, prevent, mitigate and bring to an end adverse impacts of their activities on human rights and on the environment that may occur within their value chains or operation structures, such as child labour, exploitation of workers and pollution.
This mounting pressure on businesses to navigate these new and complex ESG-related risks and achieve fair and sustainable practices, coupled with increasingly available opt-out class action mechanisms, provides fertile ground for group litigation. Although ESG-related group litigation is still somewhat in its infancy in the UK, it is expected such actions will be pursued in the near future. As demonstrated by the aforementioned Okpabi, Lungowe and Municipio de Mariana actions, the English High Court has already demonstrated a willingness to entertain mass tort environmental actions brought by foreign litigants. Furthermore, a report by the London School of Economics in 2021 revealed that a number of high-profile actions have been pursued in the UK and EU against companies in the food, transport and plastics sectors, with allegations ranging from misleading environmental claims or conveying false impressions of their products (known as “greenwashing”) to an alleged failure to reduce carbon emissions.