Sunday, August 23, 2009
I've mentioned in previous posts that the Civil Justice Council recommended using collective actions in Europe in its report, "Improving Access to Justice through Collective Actions." The U.K.'s Ministry of Justice has recently published its response to the report in which it unequivocally stated that it "does not support the introduction of a generic right of collective action." Here are a few of the key points that the Government makes in its summary:
• In particular, regulatory options should be considered before introducing court based options. For example, in some sectors it might be appropriate to give regulators power to order the payment of compensation.
• The distinction between opt-in and opt-out models for collective actions is not necessarily clear cut. They are to some extent part of a continuum. There are several options depending on the stage of proceedings at which the class is closed. Some of these may combine the features and benefits of both models.
• The issue of who may bring collective actions is best determined sector by sector. Different criteria and methods of authorisation may apply (including authorisation by the court on a case by case basis).
• The existence of effective ADR mechanisms in any collective action procedure will be crucial. So too will strong case management by the court, including merits and cost-benefit criteria.
• The ‘loser pays’ principle for costs should be maintained to help deter unmeritorious litigation.
• The Government will develop a framework document setting out the issues to be addressed when introducing a right of collective action, with options and, where appropriate, a preferred approach. This will act as a ‘toolkit’ for policy makers and legislators.
• The Ministry of Justice will work with the Civil Justice Council and Civil Procedure Rule Committee to develop flexible generic procedural rules within which any collective action scheme can operate.
My take based on the U.S. experience is that the government is often a poor sole monitor. One need not look too far into the FDA's very recent history to find fault. For those who are interested in this general topic, NYU Law Review hosted a symposium on Tort Law in the Shadow of Agency Preemption and I've written about it a bit here and here.