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10 key themes

Antitrust in court

The future for class and collective actions

New legislation in Europe to facilitate mass claims

The EU continues its initiatives to facilitate mass claims before national courts. The proposed Directive on Representative Actions enables qualified entities to bring claims for compensation on behalf of groups of consumers who have suffered harm when a trader has breached certain EU legislation. There are concerns that some of the proposals, with different treatment of domestic and cross-border actions such as on funding, will lead to forum shopping and claims being brought in the country with the least safeguards. However, following adoption of a formal position by the Council on 28 November 2019, the new regime is looking likely to become law in 2020.

Mass claims, including in the competition sphere, are being encouraged in the EU and will continue to be risks that companies will need to take into account.

Onno Brouwer
Antitrust Partner,
Amsterdam and Brussels

The Commission is also due to publish its evaluation of the impact of the Antitrust Damages Directive. It has, in the meantime, enacted guidance for national courts to help them deal with such claims. The latest is the draft communication on the protection of confidential information for the private enforcement of EU competition law by national courts, which will most probably be adopted early in 2020.

The UK’s regime will develop apace as key cases are decided

In the UK, all eyes are on the Supreme Court appeal in the seminal Merricks v Mastercard case, to be heard in May 2020. That case, in which we are defending Mastercard, will decide fundamental issues that will influence the future direction of UK collective proceedings under the UK’s Consumer Rights Act 2015 regime, including the threshold for certification of claims and whether class action aggregate damages awards need to reflect the compensatory damages principle. Other UK class actions (relating to trucks, rail tickets and FX instruments), currently stayed, will revive after the Merricks decision and the regime will move forward.

The rail tickets case is the first UK class action that does not rely on a prior infringement finding of a competition authority and the first UK class action relating to an alleged abuse of dominance. The case seeks to expand the boundaries of antitrust class actions as it is based on alleged mis-selling to consumers, not a conventional antitrust breach. This trend is likely to continue, for example by claimants seeking to frame alleged data privacy breaches as antitrust infringements.

Whatever the result of the Merricks v Mastercard appeal, competition class actions are here to stay and there will be a rush of activity in late 2020 as the stayed cases all revive. We can expect the regime to develop apace thereafter.

Mark Sansom
Antitrust and Dispute Resolution Partner,

German claims models put under scrutiny

In the absence of a true class action regime in Germany, plaintiffs’ lawyers have set up special purpose vehicles to which potential cartel damage claims have been assigned. In some cases, the special purpose vehicles pursue claims on behalf of more than 3,000 assignors in consideration of a significant share of the outcome of the litigation. Defendants have challenged such business models which are now under detailed scrutiny by the courts, for example in Munich and Hanover.

In 2020, we might also see whether a model declaratory action (Musterfeststellungsklage), introduced in 2018 to allow collective redress by consumers, will be brought in the context of cartel damage claims, which so far has not been the case.

2020 will be an exciting year for class actions in cartel damages cases in Germany as we will hear the courts’ views on the business model of bundling thousands of claims in special purpose vehicles by way of assignments.

Roman Mallmann
Dispute Resolution Partner,

Claimants gearing up for the new Dutch regime

From 1 January 2020, new Dutch legislation (Wet Afwikkeling Massaschade in een Collectieve Actie (WAMCA)) will modernise and improve the current regime for collective actions. Claims vehicles will be able to claim monetary damages on behalf of injured parties and not mere declaratory judgments as before.

But claims vehicles will be subject to stricter requirements in terms of governance, objective, representation and funding. The court will appoint a US-style quasi-lead plaintiff (exclusive representative) and there must be a sufficiently close connection with the Netherlands based on the residency of the majority of the class, the seat of the defendant or the location of the damage event.

Class members domiciled in the Netherlands may opt out whereas an opt-in regime applies for those who are domiciled elsewhere. Claimants are reportedly gearing up for the introduction of the legislation.

Major revisions of the regime for collective actions in 2020 are expected to bring more mass claims to the Netherlands. The new law will enable damages claims on behalf of the injured parties, so improving the position of claimants seeking redress.

Ulrike Verboom
Dispute Resolution Principal Associate,

High stakes for class certification in the US

In the US, federal courts have ruled against class certification in several highly visible cases, primarily due to the inclusion of uninjured class members in the class definition. If, during class certification, claimants offer no method to show injury and causation on a class-wide basis by common evidence or to exclude uninjured claimants, US courts are increasingly likely to deny class certification. In re Asacol (1st Cir. 2018) and In re Rail Freight (D.C. Cir. 2019) suggest that US courts consider the existence of more than de minimis uninjured class claimants to be a serious hurdle to class certification. Going forward, class counsel is likely to propose a method for dealing with uninjured claimants to certify a class.

US courts of appeal have again followed the Supreme Court in resolving significant evidentiary issues before certifying a class action. Counsel need to appreciate the heightened stakes at the certification stage and will come prepared to deal with uninjured claimants.

Eric Mahr
Antitrust Partner,
Washington DC

Looking ahead in 2020:

EU: while the European Commission continues its work to facilitate antitrust damages and collective consumer actions across the EU, member states are keen not to dilute their own, sometimes recently adopted or improved, collective consumer claims legislation. Either way, we will see many more of such claims arising in Europe.

UK: given the lead that the UK has within Europe in the development of antitrust class actions, we can expect such claims to be a prominent feature of the UK competition landscape post-Brexit, given that there will remain clear advantages to bringing such claims in England.

US: litigating uninjured claimant issues is now a threshold factor in US class actions, forcing defendants to confront the complexity and costs of economic experts before class certification. Courts have certified classes that include up to 6 per cent uninjured claimants but have refused to certify classes with 10 per cent or more uninjured claimants, taking into account both the ratio and the total number of uninjured claimants.

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