The Preclusive Effect of U.S. Class Action Judgments in Switzerland: Does a Judgment in an Opt-Out Class Action before a U.S. Court Preclude Absent Plaintiff Class Members from (Re)-Litigating Their Individual Claims in Switzerland?

Abstract

The Swiss legislator has so far refused to implement any substantial form of representative litigation into national civil procedure law. As an indirect consequence of the absence of domestic group litigation in Switzerland, it is unclear how Swiss courts have to deal with foreign class actions. One crucial question is whether money judgments in foreign class actions are enforceable in Switzerland, i.e. whether a class representative is able to enforce a judgment in favor of the class in this country. Yet foreign class actions also raise the additional issue whether absent class members are precluded from individually litigating their claims, particularly in case the class action was unsuccessful. While, according to the concept of U.S. opt-out class actions, individual claimants are generally barred from suing upon their own causes of action that have already been litigated in the context of a class action, the same issue is so far unresolved in the international context. Absent a relevant statutory provision or case law regarding this question, the opinions in Switzerland differ considerably.In the United States, the issue of preclusion of class members in other countries has attracted increasing interest over the last few years. Acknowledging the risk that plaintiff class members might attempt to (re-)litigate their claims in foreign jurisdictions, U.S. courts have started to take the anticipated recognition/non-recognition of the class action judgment in the plaintiffs’ home countries into account when asked to certify an international plaintiff-class.In this article, I will analyze the issues arising when a defendant argues in a Swiss court proceeding that the plaintiff was part of a class which has already litigated its members’ claims in the United States and that the plaintiff should therefore be precluded with his individual lawsuit. Then, I will examine how well Switzerland fares with its current provisions on the international level, in particular in light of the mentioned development in U.S. law regarding transnational class actions.