Mass Actions and Collective Redress – Landscape and Outlook
Today’s business world is characterised by mass production, global supply chains and digitisation, trends that are likely to continue unabated. This substantially increases business risk: a single mistake, event or circumstance can have widespread consequences, affecting large numbers of consumers and other customers. The phenomenon of mass actions – including class, group and representative proceedings – exposes businesses to potential claims and liabilities on unprecedented scales and across sectors, areas of law, regulation and geographical territories. Examples include allegations of price-fixing in relation to manufacturing components; forced labour and other ESG issues within supply chains; greenwashing; and claims relating to alleged misuse of personal data on popular platforms.
Some legislators, judges and legal market participants have looked for ways to deliver redress more readily to claimants seeking to pursue mass claims. The legal market has been very active in testing different methods of bundling together and bringing mass claims. This includes the use of innovative marketing and book-building approaches, the involvement of intermediary claims management companies, the use of legal tech, third-party funding arrangements, and the creative use of court procedures.
Jurisdictions are currently experimenting with a range of approaches to the handling of mass actions and collective redress. In Europe, Member States are implementing legislation on collective redress satisfying certain minimum standards, under an EU Directive which required them to do so by June 2023.
However, there is no real prospect of full harmonisation of procedures for mass actions and collective redress. This creates a diverse playing field, with associated challenges for stakeholders. Jurisdictions may compete as to who offers the most attractive forum for dealing with mass claims. Many claimants will have choices as to where and how to bring claims, leading to forum-shopping.
Defendants need to think carefully about strategies for early screening of potential mass actions, and how they protect themselves against such claims. In the current mass actions environment, market players.
In the current mass actions environment, market players need far more than classic legal advice to stay ahead of the game. Handling these proceedings requires comprehensive support on various fronts, many not involving traditional ‘legal’ expertise: international reach to track developments and handle matters across borders; comprehensive experience across a wide range of different types of action as well as up-to-date knowledge of legal and market developments; a deep understanding of the varying dynamics and demands of the different types of case and the importance of developing a creative, bespoke strategy for each matter at the earliest stage possible; legal tech solutions; flexible resourcing; the provision of non-legal services such as project management, damages assessment and e-data analysis; and a network of service providers to cover any other needs.