02 Dec 2022

Majority of UK public would join a class action – even if awareness of them remains low

Support for group claims comes despite lingering suspicion over perceived US ‘import’ into UK legal system, study finds

The £14bn Mastercard competition claim involves 46 million potential claimants andreykuzmin

A major survey testing the UK public’s enthusiasm for class actions has found that 60% of respondents would join a claim against a company if directly affected by its alleged illegal activities.

Portland Communications’ third annual Class Action Survey, which polled more than 2,000 people in the UK, concludes that enthusiasm for class actions ‘remains high’ despite the fact that that group claims ‘continue to carry a degree of reputational baggage risk as a US “import” into the English legal system’.

Notably, 67% of the UK respondents were prepared to sue corporates for harming the environment while 55% were prepared to sue their employers, despite fears this may lead to repercussions.

Awareness of class actions, however, remained low among the UK sample, with only 20% having high awareness of claims, a contrast to 41% of the 2,000-plus US respondents.

This underlined the need for better communications, with only a marginal increase of 2% in awareness since 2021, the report found.

Philip Hall, head of Portland’s litigation and disputes practice, noting an exponential 120% rise in class actions across Europe between 2018 and 2021, said: “The old adage that information is power is as true in the world of class actions as it is elsewhere.”

Byfield Consultancy’s managing director, Gus Sellitto, said UK consumers were prepared to seek redress, but to sustain that momentum, as class actions took off, affected consumers should be kept informed throughout the lifecycle of a claim

“Placing good PR and communications at the heart of the claims administration process will be key to this, and in continuing to build trust amongst consumers who are part of a class action,” Sellitto added.


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Where participants were aware of high-profile Competition Appeal Tribunal (CAT) cases, like the Mastercard litigation, another round of which ended in victory for the claimants earlier this week, 58% of respondents were willing to join interchange fee claims. 

Finance was not the only industry respondents were happy to sue. Perhaps inspired by the energy crisis, the energy industry was the joint top sector respondents flagged up for litigation. 

Kenny Henderson, a London-based disputes partner at CMS, said such actions would become increasingly prevalent, stretching the scope of competition law, with ESG claims also increasingly being brought for greenwashing, ‘most likely focusing on corporate claims concerning products that impacted buying choices’.

Herbert Smith Freehills partner Gregg Rowan, who has a special interest in class actions, said they had been “an increasingly important part of the UK litigation landscape for some years” with greater public awareness of cases and increased willingness to take part.

"This highlights the need for businesses in all sectors to be mindful of class actions risk – particularly though not exclusively in the competition sphere where the availability of opt-out procedures heightens the risk of huge claims,” Rowan said. 

Anthony Maton, global co-chair at Hausfeld, said while class actions were often misunderstood, the survey indicated welcome progress in public understanding, not just in the environmental sphere, but also in the finance, technology, healthcare and retail sectors. 

“These are the industries where we see the most abuse also,” he noted. “Tellingly, this is where big players have become dominant in the last 10 years, without consumers fully realising the negative side effects that brings.” 

Lianne Craig, Hausfeld’s London managing partner, whose team has filed eight collective actions at the CAT, pointed out that so far, no compensation had been awarded from ongoing actions. Craig concluded: “Once that materialises, the expectations from the UK public around the ability of class actions to secure compensation and hold organisations to account will rocket”.
 

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