Collective Redress Research Articles

Vulnerable to Inadequate Representation?

Abstract Collective redress mechanisms pose manifold challenges for the individualistic two-party paradigm of civil procedure. The EU Representative Actions Directive – transposed into German law with the Consumer Rights Enforcement Act (Verbraucherrechtedurchsetzungsgesetz – VDuG) – is built on a representative mechanism: Qualified entities (ie mostly consumer organisations) may bring actions on behalf of consumers for injunctive or redress measures against traders infringing consumer protection law. An often-neglected facet of collective redress is the vulnerability of absent plaintiffs, if collective judgments bind absent plaintiffs regardless of the adequacy of their representation. Consumers relying on their representatives could lose their actually well-founded claims as a result of inadequate representation by the representative consumer organisation and its attorneys. This article considers post-judgment safeguards against inadequate representation: As a procedural remedy, so-called collateral attacks would allow consumers to negate the binding effect of the collective judgment in cases of inadequate representation. Complementarily, the analysis turns to remedies in substantive law and considers the viability of liability actions against the representative consumer organisation or its attorneys.

A Comparative Analysis of Remedies and Challenges in the Protection of Stakeholders Rights: OHADA vs. English Corporate Law

This article provides a comparative analysis of the remedies and challenges in the protection of stakeholder rights under OHADA (Organization for the Harmonization of Business Law in Africa) and English corporate law. The study focuses on key legal remedies available to stakeholders, including the derivative action model, the unfair prejudice remedy, personal right of action, remedies for breach of contract and torts, representative actions amongst other remedies. Under OHADA, the uniform legal framework aims to harmonize business laws across member states, promoting legal certainty and economic growth. In this context, the derivative action model allows minority shareholders to seek redress for wrongs committed against the company, while the unfair prejudice remedy protects stakeholders from actions that harm their interests. Personal right of action and remedies for breach of contract and torts provide additional avenues for stakeholders to seek justice. Representative actions further enable collective redress for affected parties. In contrast, English corporate law, rooted in a common law tradition, offers flexibility and judicial interpretation in protecting stakeholder rights. The derivative action model in English law allows shareholders to bring claims on behalf of the company, while the unfair prejudice remedy addresses situations where minority shareholders are treated unfairly. Personal right of action and remedies for breach of contract and torts are well-established, providing robust protection for stakeholders. Representative actions in English law facilitate collective litigation, enhancing access to justice. In tandem with the foregoing, this paper explores challenges in the practical enforcement of these remedies, including differences in legal culture, enforcement mechanisms, and jurisdictional issues. By comparing OHADA and English corporate law, the study provides insights into the effectiveness of various legal frameworks in protecting stakeholder rights and offers recommendations for enhancing stakeholder protection through legal reforms and policy initiatives. Through a content analysis of primary and secondary data, we uphold that this article contributes to the discourse on corporate governance and stakeholder theory, offering valuable perspectives for policymakers, legal practitioners, and scholars interested in the protection of stakeholder rights in diverse legal environments.

From recipe to reality: the Polish way of collective redress

In comparison to other Member States, Poland has had experience in dealing with mass claims for quite some time, having introduced the Act of Pursuing Claims in Group Proceedings way back in 2009. This paper includes a brief overview of the legislative framework for collective redress in Poland with special consideration of consumer claims. Further, it examines the evidence-based reality of group proceedings with the purpose of identifying and addressing the problems in functioning of this mechanism in practice. To achieve this aim, it delves into a case study of one of the most significant group proceedings so far – that related to the so-called ‘Swiss loan crisis’ in Poland.

Article: The Great Saga of Collective Redress in EU Competition Law: All Cry and No Wool?

The paper presents the evolution of attempts at regulating antitrust collective redress in Europe, and the omission of listing competition law infringements in the annex to Directive 2020/1828 on consumer collective actions and thus from its scope of application. It attempts to understand why the non-availability of antitrust collective actions is the result of the long-lasting drafting processes on the EU level that typically covered competition law, taking into account that the collective redress mechanism is the only real option for consumer private enforcement of antitrust. It calls for the European Commission, the European legislator and the Member States to finally regulate collective actions in the field of competition law as otherwise access to justice for victims of antitrust breaches is not guaranteed. consumer collective redress, collective actions, antitrust collective actions, Directive 2020/1828, Directive 2014/104, follow-on, scope of application, antitrust, competition law

Article: Public Compensation for Private Harm: Fair Funds for Consumer Competition Law Redress

This paper discusses the use of the concept of Fair Funds for consumer competition law enforcement from an EU perspective. With such Fair Funds, the US Securities and Exchange Commission distributes collected fines and disgorged profits to compensate victims of securities law violations. The paper explains the use of Fair Funds in US law, highlights similarities, and adapts the concept for use in European competition law enforcement. It places an emphasis on the usefulness of such a concept against the role of consumers, but the conclusions can equally be drawn for small and medium enterprises’ private enforcement or private enforcement of competition law in general. It shows the advantages and disadvantages of including a system of Fair Funds. The paper argues that Fair Funds can serve as an alternative form of compensation, particularly for large groups of individual victims harmed in a small amount, such as consumers, with that overcome the lack of a harmonized collective redress system on EU level, and improve the coordination between public and private enforcement. private enforcement, consumers, collective redress, damages, compensation, fines, disgorgement, US, EU, financial law

The EU private international law framework for civil disputes concerning credit ratings: Exploring the status quo and prospects of reform

This article addresses the EU private international law framework for cross-border disputes concerning credit ratings. It argues that investors harmed by faulty ratings face considerable challenges when enforcing claims against credit rating agencies. These challenges arise not only due to the high standard of proof for damages claims and additional barriers rooted in substantive law but also from the limited territorial reach of the common EU civil liability regime of Article 35a of the amended Regulation (EC) No 1060/2009. Additionally, uncertainties concerning the determination of the concurrently applicable national law and the lack of unified European cross-border collective redress mechanisms in the area of capital markets law compound the problem. Against this background, this article discusses the options for reforming the existing private international law regime to enhance investors’ access to justice in disputes with CRAs.

Collective Redress in Environmental Matters - A Private International Law Perspective Through the Lens of the Dieselgate Scandal

Collective Redress in Environmental Matters - A Private International Law Perspective Through the Lens of the Dieselgate Scandal

Litigating the Algorithmic Boss in the EU: A (Legally) Feasible and (Strategically) Attractive Option for Trade Unions?

Workers subject to algorithmic management, both in platform work and in conventional employment settings, often face a justice gap in enforcing their rights, due to the opacity characterizing most automated algorithmic decision-making processes. This paper argues that trade unions are in a more favourable position than individual workers to fill this justice gap through litigation, especially when collective redress mechanisms are available. However, this becomes possible only when the legal system is favourable to this type of litigation. This article analyses three legal domains at EU level where justiciable rights are more likely to be violated through algorithmic management devices, in order to assess whether it is legally feasible for trade unions to promote algorithmic litigation under EU law. Even when the legal framework is conducive to this type of litigation, it cannot be automatically expected that trade unions will more frequently resort to it to better enforce the rights of workers subject to algorithmic management devices. Previous research shows that trade unions are traditionally keen on turning to litigation only when they are able to link it to their broader strategies. This paper claims that this may be the case against employers using algorithmic management. For trade unions, resorting to litigation can be strategically instrumental not only to fulfil the legal purpose of alleviating the justice gap faced by workers through a better ex post enforcement of their rights, but also to achieve the meta-legal purpose of mobilizing them and the para-legal purpose of strengthening collective bargaining, especially considering that this would constitute an effective means to induce stronger ex ante compliance. Algorithmic Management, Platform Work, Algorithmic Transparency, Algorithmic Discrimination, Employment Protection, Data Protection, Trade Unions, Algorithmic Litigation, Collective Redress, Legal Mobilization, Collective Bargaining

A brief overview of collective consumer redress in the European Union and South Africa and moving towards the increased use of a consumer class action in South Africa – part two

Building upon the groundwork laid in part one of this two-part article, which illuminated the landscape of collective consumer redress within the European Union (EU), part two delves into the unique trajectory of this legal phenomenon in South Africa. While collective consumer redress is still a burgeoning concept in these jurisdictions, the dynamics governing it display distinctive characteristics, especially in a consumer context. This article commenced by considering the position in South Africa, where class actions under section 4(1) of the Consumer Protection Act 68 of 2008 are specifically scrutinised. Surprisingly, there is a paucity of such actions, prompting a closer examination of the reasons for this. The article seeks to elucidate the status of collective consumer redress in South Africa and to uncover potential insights from the European Union. By scrutinising these frameworks, the article aims to assess whether South Africa could derive benefits from adapting certain elements to enhance the efficacy of its own consumer class actions under the act. Ultimately, the overarching goal of this two-part article is to identify strategies that optimise consumer class action, paving the way for enhanced access to justice for South African consumers. As we navigate through the legal landscape of South Africa, our pursuit is guided by the quest for a more robust and equitable collective redress system that aligns with the evolving needs of consumers in these jurisdictions.

Is it Still Too Early for Collective Redress in Arbitration? – The Boundaries and Opportunities in European Perspectives

As has been often stated in judicial practice, collective redress simply reflects the rise of mass production, the diversification of corporate ownership, the advent of the mega-corporation, and the recognition of environmental wrongs. Although the American opt-out class actions are the first thing that comes to mind when one thinks of collective redress, European legislators have been particularly wary regarding the possibility of the US “toxic cocktail" finding their way into European legislations. On the other hand, arbitration, in its basis, is a private way of resolving disputes which is a creation of the parties in the dispute. In its basis there must be consent of the parties to submit the particular dispute to be resolved in arbitration proceedings. Therefore, the possibility to incorporate collective redress mechanism in arbitration proceedings might raise many questions.

Consumer Collective Redress in Turkey: The Need for Reform in Light of the EU Regime

Consumer Collective Redress in Turkey: The Need for Reform in Light of the EU Regime

История развития и современное регулирование коллективных исков в Японии

The author is tracing the development of collective redress in Japan beginning from feudal times till today. He comes to conclusion that Japanese lawmaker shows restrictive and cautious approach to implementing collective procedures in civil litigation. Current regulation of representative and class actions in Japan is characterised by opt-in model of member participation. In addition, the class litigation is based on the mechanism of an organisational action. Such choice of the legal construction has different consequences: on the one hand, it gives no chance to induce a private initiative in the class litigation, but on the other it has a form which is well-tested in European jurisdictions, and that makes the class action stable. The author enphasises creative basis in building an original model of the class action in Japan. It shows itself in adoption of standards of a legal regulation in this field from European countries and the Anglo-Saxon legal world. One of the realised elements of the Japanese regulation was a bifurcation, which could also be implemented in Russia. At the end of the article questions of cross-border litigation are discussed concerning the use of the class action in Japan.

2022 in review: a look at key developments in opt-out collective redress in the UK

2022 in review: a look at key developments in opt-out collective redress in the UK

Collective redress mechanisms in minority protection: the case of Hungary

Collective redress mechanisms in minority protection: the case of Hungary

For Justice, Not Profit: Public Funding of Collective Redress

For Justice, Not Profit: Public Funding of Collective Redress

The legal framework of data subject representation

The GDPR provided for new rules on the right of the data subjects to an effective judicial remedy against a controller or a processor where they consider that their rights have been infringed under the Regulation as a result of the processing of personal data. Art. 80 of the GDPR, on the representation of data subjects, is intended to favour private enforcement of EU data protection law, providing for the representation of data subjects by a body or entity which must meet specific requirements in order to exercise the rights conferred to the data subject regarding an effective judicial remedy. The representation of data subjects by a third party in legal actions is possible in two cases: on the one hand, the situation where a data subject mandates the body or organization to represent them or, on the other side, when a body or organization, has the right to lodge a complaint and exercise the rights to effective judicial remedies provided by the GDPR independently of a mandate. This paper will detail the legal framework of this private enforcement tool and analyse the links between data protection and consumer protection from the perspective of collective redress and representation of the interests of a data subject.

A Behavioural Analysis of the Future of Collective Redress for Financial Consumers Following the Supreme Court Decision in Merricks v Mastercard

One of the biggest problems faced by consumers seeking redress for financial harm is the prohibitive expense and impracticality of bringing low-value individual legal proceedings. The Consumer Rights Act 2015 introduced a new regime for collective redress for competition law infringements whereby for the first time, claims may be brought on an opt-out basis. The new regime was examined by the Supreme Court in its recent decision in Merricks v Mastercard. The Mastercard claim raises important questions about consumer remedies, access to justice, litigation funding and practical enforcement issues. This paper examines the decision through the lens of behavioural science, seeking insights into the availability and accessibility of redress for consumers and considering the implications for the regulation of lenders in the future. The influence of behavioural science on the development of the law is reviewed, the progress of the Mastercard claim and the Supreme Court’s decision is analysed, and some conclusions are proposed about possible future developments and the effectiveness of the collective redress regime from a behavioural perspective.

Strategic litigation before the European Committee of Social Rights: Fit for purpose?

This article examines the structural elements of the Collective Complaints Procedure, seen as an avenue of socio-economic rights strategic litigation, that potentially enable or impede NGOs and trade unions in addressing violations of the European Social Charter before the European Committee of Social Rights. The findings show that the procedure is a unique form of collective redress in the human rights system, with exceptional structural characteristics, which render it an avenue of strategic litigation by its nature. Its main strength lies in that it enables the participation of organisations and vulnerable groups of people that are denied access in political or judicial fora, either at the domestic or supranational level, to deliberate on social policy issues and put pressure on States to address social issues on the basis of economic and social rights.

An Effective On-line Dispute Resolution Network for Enhancing Collective Redress in Europe: How to Handle Mass Small Claims Through an Integrated Approach

The ESCP disappointing results, the scarce interconnection between Reg. 861/2007, ADR legislation and Directives 2019/2161 and 2020/1828, as well as the suboptimal functioning of the ODR platform urge for a global rethinking. The Author points out some possible interventions to implement consumers’ and users’ protection in relation to small and homogenous claims, hoping that the European Institutions will soon consider a reform aimed at establishing an online integrated justice service in which court procedures merge with mechanisms of amicable solution.

Closing the Floodgates on Privacy Class Actions: Lloyd v Google LLC

In Lloyd v Google LLC [2021] UKSC 50, the Supreme Court overturned the Court of Appeal's decision, which had allowed a claim under the Data Protection Act 1998 to proceed as a representative action under CPR 19.6. This is significant because the Court of Appeal's decision arguably paved the way for further data protection/privacy claims to be brought as opt‐out ‘class actions’ using this procedure. This case note summarises the Supreme Court decision and assesses its implications for both the procedural law of collective redress and the substantive law of privacy in England. It argues that the Supreme Court's reasoning in relation to both of these areas is sound as a matter of precedent and statutory construction. As a matter of public policy, the decision is likely to re‐enliven debate about the availability of collective redress in English law and whether the existing collective proceedings regime should be broadened.