Thursday, June 5, 2014
Opt Out Competition Law Class Actions – An American Perspective On The Consumer Rights Bill Pending in the UK Parliament
Larry Popofsky (Orrick) presented a paper at the Oxford Competition Law Centre on Opt Out Competition Law Class Actions – An American Perspective On The Consumer Rights Bill Pending in the UK Parliament.
ABSTRACT: Currently pending before the UK Parliament is a sweeping consumer rights bill which is likely to be passed in the relatively near future. Among its extensive provisions is a proposed reform of British competition laws in which a controversial opt out class action procedure would be enacted for the first time. By its terms violations of UK and EU competition laws can be asserted on behalf of a defined class either on an opt out or out in basis. Such claims would be filed before the Competition Appeal Tribunal (CAT) which would superintend all aspects of the litigation under an expanded grant of jurisdiction With respect to the new opt out procedures the bill’s draftsman sought to ensure that the proceedings would not introduce into Britain what is generally considered to be a undesirable American litigation culture. It is the thesis of this paper that the Bill if passed will succeed in meeting that goal for six interrelated reasons: The proposed statute 1) prohibits exemplary damages unlike the American where treble damage are a statutory right; ; 2) prohibits contingency fee arrangements unlike in America and in other types of British litigation; 3) would not alter the general British rule that the loser pays all legal costs including the attorney’s fees of the victor; 4) prohibits trial by jury unlike in America where such trials are viewed as a constitutional right however complex the subject matter; 5) does not expand the newly enhanced British pretrial disclosure procedure to include such American discovery features as broad document production and compelled pretrial testimony under oath either by opposing or third parties; and perhaps most important 6) by draft CAT rule provides that in deciding whether to certify a class or subclasses on either an opt out or opt in basis the CAT may consider the merits of the asserted claim though the draft rules do not specify how this is to be done. This paper concludes by broadly describing two Visa cases in the last decade which may be thought to exemplify the supposedly undesirable American system and concludes with the opinion that there is virtually no possibility that the proposed British class action reforms will be adopted in America.