Title: Class actions
1Class actions
- Comparative profiles and protection of the
consumers - Short report of
- the conference carried out in Padova, 18 19 May
2The program,18 may
- Prof. Andrea Giussani introduction on the class
actions as the best way for the protection of the
consumers. - Avv. Lorenza Bergamo examples of collective
actions in Italy and connected problems. - Prof. Sergio Chiarloni protection of the
consumers in Italian system and bills in order to
introduce class actions. - Rachael Mulheron?English Group Litigation
- Prof. Francesco Shurr?? collective protection of
the consumers in the European Union legislation. - ?(Reader, Department of Law, Queen Mary
University of London) - ??(University of Innsbruck)
3The program,19 may
- Rachael Mulheron medical class actions and group
litigations in a comparative perspective. - Francesco Shurr the German collective action.
- Prof. Marco De Cristofaro the protection of the
mass and collective interests between the Italian
civil code and civil procedure. - Prof. Andrea Giussani is it possible to
introduce the class actions in Italy?
4Giussani introduction on the class actions as
the best way for the protection of the consumers
- Italian civil code, rule 1469 sexies C.Civ. (but
now it is in the Consumer Code). - The associations and trade unions of consumers
can sue the companies and the producers that put
in the contract illicit condictions. - They can obtain an injunction or declaration
against the corporations / producers to stop the
illicit practice. - - Differences between art. 1469 sexies and U.S.A.
Rule 23 (Fed. R. Civ. P. 23).
5Giussani introduction on the class actions as a
the best way for the protection of the consumers
- In the U.S.A. system the access to the justice is
simpler than in Italy. - Because in U.S.A. there are contingency fees
agreement. - Instead of this, in Italy there is the rule of
victus victori (the party who loses the action
must pay expenses lawyers also of the other
parties). - For the consumers there is less expensive to sue
the corporate in U.S.A. than in Italy.
6Avv. Lorenza Bergamo examples of collective
actions in Italy and connected problems.
- Financial Crack (e.g. Agertinian bond Cirio
Corporation Crack Parmalat) has offered the
opportunity to experiment collective actions. - Many of them are still in Tribunal (Padova and
Treviso). - Collective action under the Consumer rule, by
now, are brought by the Federconsumatori - Federconsumatori is the association that pick
up a lot of persons, who are generally called
consumer the consumers for being able to be part
of a collective action must be enrolled to the
association. - The association is the party in the process, but
needs the authorization of each one of the
persons enrolled who want to sue the same
defendant.
7Avv. Lorenza Bergamo examples of collective
actions in Italy and connected problems.
- Example
- 500 workers of a company that used asbestos v.
INPS (Italian government body for public
welfare) - Much more complicated case for the judge
- Many individual claims put together because of a
common issue of fact/law - The judge rejected the action
- The expenses lawyers have been divided between
all the workers
8Prof. Sergio Chiarloni protection of the
consumers in Italian system and bills in order to
introduce class actions.
- The bills to the examination of the Parliament
- Many different opinions the major points
- Copy the North American model (injunctive and
damages class action) - Perfect and improve the model of collective
action (that still exits in the Consumer Code) - He prefers this way, because it should be less
difficult to realize in Italy.
9Prof. Sergio Chiarloni protection of the
consumers in Italian system and bills in order to
introduce class actions.
- Problems in the bills (2model)
- Only the associations are able to bring
collective action. - Should be used procedure for business action
(d.lgs. N. 5/2003, very complicated rules). - punitive damages (against the Constitution).
- No provisions about certification categories of
types of class actions. - - Both models (1,2) use ambiguous concepts and
mix terms of one and the other model.
10Prof. Francesco Shurr collective protection of
the consumers in the European Union legislation.
- directives of the European community to fight
unfair competition. - Most of them preview injuctive remedies.
- Problems
- Every country must compare them with its own
legal principles. - often they delay to perform them.
- the consumers and the judges do not have
incentives for resort to the E.C.J and perfom its
decisions. - The sentences of E.C.J. against the states are
too much low and so they do not stimulate to
perform and enforce the E.U. law.
11Rachael Mulheron English Group Litigation
- A. England has a representative rule the
earlier versions is of 1873. - B. In 2000 representative rule was repeated and
introduced G.L.O. (Group Litigation Order). -
- A. Representative rule
- Where more than one person has the same interest
in a claim, the claim may be begun or the court
may order that the claim be continued, by or
against one or more of the persons who have the
same interest as representatives of any other
persons who have that interest.
12Rachael Mulheron English Group Litigation
- Difficulties
- - In application to most group litigation (e.g.
Markt Co Ltd v Knight Steamship Co Ltd, where a
ship sank, in 1910, during a war and all cargo
aboard went lost). - Barriers to bring litigation for many reasons
separate contracts separate defenses separate
damages claims separate final decisions and res
judicata. - Traditionally the representative rule contains an
opt-in regime. - Group litigation brought, prior to 2000, gave the
lack of utility of the representative rule (e.g.
in 1996, the Creutzfeldt-Jakob litigation ).
13Rachael Mulheron English Group Litigation
- B. Group litigation orders (GLOs)
- Definition (Civil procedure rules, part 19
section 10 rule 19.10) - A group litigation order means an order made
under rule 19.11 to provide for the case
management of claims which give rise to common or
related issues of fact or law (called the GLO
issues). - Group litigation order (rule 19.11)
- The court may make a GLO where there are or
likely to be a number of claims giving rise to
the GLO issues.
14Rachael Mulheron English Group LitigationThe
opt- in approach advantages and disadvantages
(compared to opt-out models)
- Advantages
- opting-in preserves the liberty of the individual
to choose whether to sue. - a person who does not want to litigate should
not find himself roped in to a class action as
a result of mere silence. - Under opting-in, class members will be bound by
the result only if they intend to be so bound.
- Disadvatages
- Opting-in is little more than a permissive
joinder device, for people who want to sue
together. - Opting-in is a barrier to participation in the
litigation, for people who are vulnerable and
subject to barriers. - Opting-in does not promote access to justice as
opt-out regimes do.
15Rachael Mulheron English Group Litigation
- opt-in regimes reduce the possibility of the
litigation becoming unmanageable. - The opt-in approach assists the defendant to know
the size of the potential class - Opt-in helps to reduce the problem of future
claimants emerging over time. - Opt-in regimes are consistent with the ordinary
procedures for commercing a legal proceeding.
- A person may not learn, until too late, of his
right to opt-in, which he would have exercised,
if he had known. - Establishing an opt-in register too early in the
action can encourage weak claims. - Multiple proceedings for the defendant are more
likely under opt-in. - Identifying all class members can be very
difficult for claimants lawyers at the time that
the register is closed. - Opt-in does not fulfill the deterrent function of
the law, because it can lead to under-compensation
16Rachael Mulheron English Group Litigation
- Application of the GLO
- A wide variety of scenarios have been covered to
date under the GLO regime (e.g. holiday packages,
care homes alleged abuses, pension disputes, tax
payment disputes, allegedly defective medical
products, landfill nuisance claims). - Number until now there have been 52 Group
Litigation Orders it mans that the rule has been
used on a fairly modest scale. People are not
encouraged to ask for GLO. - Why? The major problem, probably, is this the
GLO is too much brief and this is a value but it
could be also a problems.
17Rachael Mulheron English Group Litigation
- 5 Criteria for the commencement of a GLO to
bring a multi-party action following requirements
are necessary - A number of claims
- Giving rise to common or related issues of fact
or law - must be consistent with the overriding objective
of the CPR, which is to enable the court to deal
with cases justly - Consent of the CJ (Lord Chief Justice, if it is
in Queens Bench division) or VC
(Vice-Chancellor, if the order is in a county
court) is required - No GLO if, for example, the representative rule
wuold be more appropriate for the case.
18Rachael Mulheron English Group Litigation
- Anyway, a lot of problems with this procedural
device remain. - Other ad hoc representative rules and proposals
(and bills) - Competition Act 1998, c41, s47b.This rule
permitts representative actions to be brought on
behalf of consumers in respect of antitrust
violations and anti-competitive practices - A variety of EU consumer protection directives.
- English reform proposals in 2006
- Representative Actions for the Enforcement of
Intellectual property rights - Representative Actions in Consumer protection
legislation - Damages Actions for Breach of the EC Antitrust
rules.
19Rachael Mulheron English Group Litigation
- Comparison with the other models of class action.
- 1. A lot of differences with the definition of
the U.S.A. class action - A class actions in USA is a procedural device
which enables the claims of a number of persons
against the same defendant to be determined in
the one suit. - In a class action, one or more persons (the
representative plaintiff) may sue on his own
behalf and on behalf of a number of other persons
(the class) who have a claim to a remedy for the
same wrong, and who have claims that share
questions of law or fact in common with those of
the representative plaintiff (the common issues).
Only the representative plaintiff is a party to
the action. - The class members are not usually identified as
individual parties, but are merely described. - The class members are bound by the outcome of the
litigation on the common issues, whether
favourable or adverse to the class.
20Rachael Mulheron English Group Litigation
- 2. Other examples of class actions, for example
- Federal Court of Australia Act 1976
- Class Proceedings Act 1992 (Ontario and most
other Canadian common law provinces in the years
thereafter). - 3. CONCLUSIONS
- Major differences in operation between the
English GLO and the USA class action - a. The conduct of certification, to consider
- Numerosity requirements (what minimum number of
class members is required?) - Commonality (what common issues of fact/law exist
and how predominant must the common issues be
over the individual issues?)
21Rachael Mulheron English Group Litigation
- Superiority (what factors indicate that a class
action is the best or preferable way of
determining the dispute between the class members
and the defendant?) - Adequacy of representation (is the representative
claimant suitable and able to adequately
represent the class members?). - b. Opt-out regimes advantages and disadvantages.
- c. Class definition instead of indentification of
class members.
22(19 May)Prof. Marco De Cristofaro the
protection of the mass and collective interests
between the Italian civil code and civil
procedure.
- Which and how principles of civil code and civil
procedure code could be modified? - It is political problem and it is necessary to
divide the consumers into three categories - consumers who have suffered a light injury (e.g.
phone companies for the telephone rates) . - Consumers who have suffered a little greater
injury (e.g. antitrust violations). - Consumers who have suffered serious injury (e.g.
mass torts).
23(19 May)Prof. Marco De Cristofaro the
protection of the mass and collective interests
between the Italian civil code and civil
procedure.
- The possible solutions
- a. If damages are small or little greater it is
better (cases 1,2) for the consumer to aggregate
in a class to recover them. - In this case (a) the principles (e.g. fair
process and representation the right to have
trial ) will be minimally compromised. - b. If there are serious damages (case 3) it will
be better for the person to act alone and bring
an individual lawsuit. - - In this case (b) if there was a collective or
class action the principles would be mainly
compromised
24(19 May)Francesco Shurr the German model of
collective action.
- Gesetz zur Einfuhühurng von Kapitalanleger
Musterverfahren (KapMuG) law for the
introduction of the model procedures for the
investors - It is effective since 1 November 2005.
- History More than 15.000 investors sued Deutsche
Telekom in more than 2500 individual lawsuits
with 700 lawyers the courts were incapable to
manage all the causes and they were too much
complicated to put together before one court. - Consequences German Costitutional Court
enforced the Legislator to create a collective
action in order to avoid what succeded in
Deutsche Telekom case
25(19 May)Francesco Shurr the German model of
collective action
- Targets
- to bring a collective action and so put together
in the same judgment all the persons who have
suffered the same damage to reduce individual
lawsuits. - To fight forum shopping
- To avoid the problem of contrasting decisions.
- Fields
- (KapMuG ) can be certified only in case of unfair
advertising (very limited application).
26(19 May)Francesco Shurr the German model of
collective action
- Procedure
- Ask the court to bring the collective action
(KapMuG) there must be at minimun 9 individual
actions. - Give notice publishing it in the Official
Journal. - Exhibition order to the plaintiffs and
defendants. - Possible to appeal the exhibition order.
- Certification of the model plaintiff (like
class representative). - Dicover and suspend all the judgment connected
with one that is already certificated (this, in
practice, takes a very long time). - Possible to opt-in in the class (not if the
judgment is suspended). - There are not contingency fees.
27(19 May)Francesco Shurr the German model of
collective action
- Why (KapMuG) is different from all other
countries. - The judgment must be started as indivudual by one
plaintiff. - This plaintiff (or the defendant) should ask for
the collective action. - If there are requirement to proceed as a
collective action (KapMuG) the court will
consider the predominant common questions of
fact/law this is the collective phase. - Decision on common questions is binding for all
the members of the action (only for the party who
opt-in the class). - After that everyone of the individual judgments
stared continue again to decide the individual
questions (the issues that are different for
every single case). - the judgment begins individual and ends still
individual, after one common phase.
28(19 May)Francesco Shurr the German model of
collective action
- Conclusions
- Germany courageously has decided to experience an
absolutely new model. - The model will be in force (effective) until 1
November 2010.
29Rachael Mulheron medical class actions and group
litigations in a comparative perspective.
- How do group medical class actions arise?
- In England there are several possibilities. Which
causes of action are possible - Tort negligence breach of statutory duty.
- Breach of contract.
- Equity fiduciary breaches.
- Statute consumer Protection Act 1987.
- Major problem actions may be brought against
several possible defendants.
30Rachael Mulheron medical class actions and group
litigations in a comparative perspective.
- Examples of medical class actions
- England Davies v. Eli Lilly (1987) Benoxaprofen,
for arthritic treatment. - Australia Bray v. F Hoffmann-La Roche Ltd (2003)
vitamins pills. - Canada Anderson v. Wilson (1999) Hepatitis B
among patients who attended a clinic for an ECG
test, and who were cared for a techician who was
Hepatitis B-positive. - USA In re Telectronics Pacing Systems Inc.
(1996) Defective pacemaker leads.(but also Abbott
Laboratories)
31Rachael Mulheron medical class actions and group
litigations in a comparative perspective.
- Potential problems with medical class actions
- 1. The problem of multiple defendants
- The crucial question is if it is necessary for
each representative plaintiff and each class
member to have a claim and a cause of action
asserted against each defendant. - Different views from different countries
32Rachael Mulheron medical class actions and group
litigations in a comparative perspective.
- Canada (Ontarios more permissive rule)
- Bendall v. McGahn Medical Corp (1994) leaking
silicon breast implants. - It is not necessary for the class representative
to be able to sue each defendant - Necessary to prove only a cause of action
asserted agaist one defendant.
33Rachael Mulheron medical class actions and group
litigations in a comparative perspective.
- Australia (stricter position)
- Nixon v. Philip Morris Ltd (1999)
- It is necessary to prove
- the cause of action
- against each defendant.
34Rachael Mulheron medical class actions and group
litigations in a comparative perspective.
- 2. The problem of proving commonality
- The common issue do not have to detemine
liability of the defendant although the number
of individual issues impacts upon the analysis
(e.g. diagram before). - Proving causation in medical negligence in
medical product in pharmaceutical product. - Claims can be very tricky and hard to bring for
the plaintiffs. - It will be essentially an individualized enquiry
for each class member. - Could be useful sub-classes when two different
theories of liability are being advanced by the
class (that is what happened in Anderson v.
Wilson (1999).
35Rachael Mulheron medical class actions and group
litigations in a comparative perspective.
- 3. The problem of limitation periods
- Usa class action rule the limitation period for
all class members is stopped - Contrast with it the position under the English
GLO, where the limitation period continues to run
against all group members (because they have to
file their individual claims and after they enter
the group)
36(19 May)CONCLUSIONSProf. Andrea Giussani is
it possible to introduce the class actions in
Italy?
- He is sure that Italy can adopt USA class
actions. - They would be the only and best way to protect
the rights of persons who, otherwise, would not
be able to get protection with the same positive
effects. - If Italy will not make all the possible to take
in class actions it will lose its sovereignty,
more and more to the time. - - About this problem the U.S.A. jurisdiction is
very receiving and many persons have already part
of a class actions (e.g. Argentinian bond)
37