May 26, 2009
Continuing Debate over "Opt-Out" Collective Redress in England and Wales
The United States isn't the only country experiencing civil reforms (i.e., Iqbal and Twombly). England and Wales are reevaluating their rules of civil procedure and the debate over class actions or "collective redress" has been brewing for some time. On May 8, 2009, Lord Justice Jackson released his preliminary report, which reviews civil litigation costs. The report follows two reports issued by the Civil Justice Council that recommended adopting an opt-out system of collective redress, introducing American style contingency fees, and doing away with the loser-pays English system. Lord Justice Jackson's preliminary report similarly suggests that abolishing the cost-shifting loser-pays system "merits serious consideration." Moreover, he raises the idea of one-way cost shifting to collective actions where claimants would be awarded their costs upon winning, but wouldn't bear the risk of taking on the defendant's attorneys' fees and costs if they lost.
As for collective redress, Jackson broaches the subject but ultimately refrains from recommending either the current opt-in procedure or a more encompassing opt-out procedure. He does, however, note that the current opt-in model discourages these type of enforcement actions. He invites written comments on the report and requests that they be sent by July 31. The submission information can be found here. Lovells LLP has written a brief and helpful overview of the report, which is available here.
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