Consumer Collective Redress in European Private International Law

Journal of Private International Law

Volumn 7, Issue 1, 2011, Pages 101-147

  Tang, Zheng Sophia ^a  

^a UNIVERSITY OF ABERDEEN   (United Kingdom)

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EID: 84906857856     PISSN: 17441048     EISSN: 17578418     Source Type: Journal    
DOI: 10.5235/174410411795375614     Document Type: Article

References (235)

1. More than 70% European consumers would be more willing to defend their rights in court in a collective redress. See the survey result in “Consumer Protection in the Internal Market” (October 2008), http://ec.europa.eu/public_opinion/archives/ebs/ebs_298_en.pdf, 78, accessed on 2 November 2009. However, it is also uncertain as to the actual impact that a collective redress may bring to consumers' access to justice. C, Hodges, “Collective Redress in Europe: The New Model” (2010) 3 Civil Justice Quarterly 370, 371
2. 2 Differences, however, exist between class action procedures in different countries. Slight differences also exist in class action procedures in different states in the US. Practices differ greatly as to the scope of its application, the prerequisites to initiate the mechanism, the qualification of the acting party on behalf of all consumers, the way to join claimants in the action, and the binding effect over all claimants in the collective action
3. Various forms of collective-redress mechanisms have been adopted in 13 Member States, and these mechanisms are not widely used in practice. See in general F, Alleweldt, A, Tessler, P, Rott and S, Kara, “Evaluation of the Effectiveness and Efficiency of Collective Redress Mechanisms in the European Union, Final Report—Part I: Main Report” (“Main report”), 26 August 2008, para 3.4, available at http://ec.europa.eu/consumers/redress_cons/finalreportevaluation-studypart1-final2008–11–26.pdf, accessed on 14 October 2010
4. HW, Micklitz and KP, Purnhagen, “Evaluation of the Effectiveness and Efficiency of Collective Redress Mechanisms in the European Union—Country Report: Austria”, 17 July 2008, available at http://ec.europa.eu/consumers/redress_cons/au-country-report-final.pdf, accessed on 12 October 2010, para 1.1
5. See “Main Report”, supra n 3, 5
6. Details of this work can be found on the website of the European Commission, Consumer Affairs, at http://ec.europa.eu/consumers/redress_cons/collective_redress_en.htm, accessed on 20 October 2010
7. This paper only looks at collective redress for damages, and does not include protective actions, such as injunctions. Directive 98/27/EC on injunctions for the protection of consumers' interests [1998] OJ L166/51 permits consumer associations to bring proceedings preventing an action that infringes consumer law in other Member States. The injunction Directive was deemed by Burkhard Hess as not very successful: see B, Hess, “Cross-border Collective Litigation and the Regulation Brussels I” [2010] IPRax Heft 2, 116
8. Such as the Group Litigation Order (GLO) in England, see Part 19III of the Civil Procedure Rules. J, Stuyck, E, Terryn, V, Colaert, et al, “An Analysis and Evaluation of Alternative Means of Consumer Redress other than Redress through Ordinary Judicial Proceedings: Final Report”, 17 January 2007 (“Leuven Report“), http://ec.europa.eu/consumers/redress/reports_studies/comparative_report_en.pdf, 268, 290, accessed on 4 September 2010, para 370
9. Such as the Azione collettiva risarcitoia (Art 140bis of the Consumer Code) in Italy, s 227 in connection with 502 ZPO in Austria, Part 19II of the CPR in England, the joint representative action in Art L422–1 of the Consumer Code in France, and the Sammelklage in Germany. Leuven Report, ibid, para 371
10. Such as s 502 ZPO in Austria, the Musterklage (model claim) in Art 1(3)(8) of the Legal Services Act in Germany. Leuven Report, ibid, para 372
11. The definition and categorisation in the Main Report is different from the article. See Main Report, para 3.3. Cf Leuven Report, supra n 8, para 369. For a study of collective redress mechanisms existing in different Member States in Europe, see D, Fairgrieve and G, Howells, “Collective Redress Procedures—European Debates” (2009) 58 International and Comparative Law Quarterly 379
12. Austria, Bulgaria, Denmark, Finland, France, Germany, Greece, Italy, the Netherlands, Portugal, Spain, Sweden and the UK. See in general “Main Report”, supra n 3; Leuven Report, supra n 8, para 384
13. Leuven Report, supra n 8, 12
14. Communication from the Commission to the Council, the European Parliament and the European Economic and Social Committee: EC Consumer Policy Strategy 2007–2013, http://ec.europa.eu/consumers/redress/collect/strategy0713_en.pdf, 11, accessed on 26 September 2008
15. Such as the Portuguese Presidency Conference on Collective Redress in Lisbon on the 9–10 November 2007, the Leuven brainstorming event on 29 June 2007, three separate workshops held by the European Commission on 21 May 2008, 29 May 2008 and 6 June 2008 in Brussels, etc. They can be found on http://ec.europa.eu/consumers/redress_cons/collective_redress_en.htm, accessed on 20 March 2008
16. European Commission, ‘Green Paper on Consumer Collective Redress’, COM(2008) 794 final
17. Ibid, 7–8
18. Ibid, 8–9
19. Ibid, 9–12
20. Ibid, 12–14
21. European Commission, “Consultation Paper on the follow-up to the Green Paper on consumer collective redress” (“Consultation Paper”), which is a discussion paper for the hearing on 29 May 2009, available at http://ec.europa.eu/consumers/redress_cons/docs/consultation_paper2009.pdf, accessed on 17 November 2010
22. Ibid, 15–18
23. Eg The Green Paper on Consumer Collective Redress admitted that “the efficacy of cross-border redress needs to be addressed independently”, and “as economic market integration at retail level increasingly leads to consumers participating in retail markets beyond their borders and therefore being affected by the same practices as national shoppers, it is not found useful to make a distinction between cross-border mechanisms for mass claims and purely national mechanisms. Another issue arising is whether instruments possibly to be chosen would apply only to cross-border or also to national cases.” Green Paper on Collective Redress, supra n 16, 2–3
24. Summary of the Leuven Brainstorming Event on Collective Redress, 29 June 2007, collecting thoughts and experiences on collective redress, http://ec.europa.eu/consumers/redress_cons/docs/summary_leuven_event.pdf, accessed on 23 November 2008
25. European Commission–DG Sanco, “Evaluation of the Effectiveness and Efficiency of Collective Redress Mechanisms in the European Union”, 44; Green Paper, supra n 16, 6
26. The European Commission suggested in the Green Paper on Collective Redress (supra n 16, 4) that “As economic market integration at retail level increasingly leads to consumers participating in retail markets beyond their borders and therefore being affected by the same practices as national shoppers, it is not found useful to make a distinction between cross-border mechanisms for mass claims and purely national mechanisms.”
27. Ibid, Option 2, para 23
28. Ibid, para 24
29. Ibid, para 31
30. Ibid, paras 58–59. For more discussion, see infra sections C.1(c) and D.2
31. Ibid, paras 31, 58–59
32. Federation European Direct Selling Association (FEDSA), “Re European Commission Green Paper on Consumer Collective Redress COM(2008) 794 final of 27 November 2008“, 4
33. Ibid
34. All responses are available via the website of the European Commission, DG Health and Consumer, at http://ec.europa.eu/consumers/redress_cons/response_GP_collective_redress_en.htm, last accessed 20 October 2010
35. 35 Although Art 6(1) of the Brussels I Regulation deals with multi-defendant claims, this action is excluded from the consumer collective action that is discussed in the article, where multi-claimants combine their claims against one defendant
36. 36 Brussels I Regulation, Art 2(1)
37. 37 Brussels I Regulation, Art 5(1)
38. 38 Brussels I Regulation, Art 5(3)
39. 39 Brussels I Regulation, Art 5(1)(b).,
40. 40 Brussels I Regulation, Art 5(1)(b)
41. 41 Brussels I Regulation, Art 5(1)(c)
42. 42 Brussels I Regulation, Art s15–17
43. 43 Brussels I Regulation, Arts 8–14
44. 44 Brussels I Regulation, Arts 18–21
45. 45 Brussels I Regulation, Art 6(1). Although this is also a type of collective redress in a broad sense, it is not covered in the article, which only deals with collective redress where multiple claimants aggregate their claims together.,
46. 46 Brussels I Regulation, Art 6(2)
47. 47 S 4 of the Brussels I Regulation.,
48. 48 Art 5(1) of the Brussels I Regulation
49. Case C-96/00 Gabriel [2002] ECR I-6367, paras 35–36; Case C-27/02 Engler [2005] ECR I-481, paras 31–33
50. Case C-26/91 Jakob Handte GmbH v Traitements Mécano-chimiques des Surfaces SA [1992] ECR I-3967; Case 34/82 Martin Peters Bauunternehmung v Zuid Nederlandse Aannemers Vereniging [1983] ECR 987; Case 9/87 Arcado v Haviland [1988] ECR 1539; Case C-51/97 Réunion européenne and Others [1998] ECR I-6511; Case C-334/00 Tacconi [2002] ECR I-7357
51. Eg consumers A and B bring a group action against one defendant concerning damages arising out of contracts between the defendant and each claimant. The dispute between each consumer and the defendant concerns “matters relating to a contract”. The group action only congregates two contractual matters into one proceeding for the purpose of convenience, without changing the nature of the claim into any other type
52. See supra section A
53. Case C-265/02 Frahuil SA v AssitaliAspA [2004] ECR I-1543, para 20
54. Ibid, para 21
55. Green Paper on Collective Redress, supra n 16, para 58
56. Case C-26/91 Handte v Traitements [1992] ECR I-3967, para 15
57. Case C-167/00 Verein für Konsumenteninformation v Karl Heinz Henkel [2002] ECR I-8111
58. Ibid, paras 38 and 39
59. Ibid, para 39
60. Ibid, para 38
61. Case C-265/02 Frahuil SA v AssitaliAspA [2004] ECR I-1543
62. Ibid, para 26
63. Davenport v Corinthian Motor Policies at Lloyd's 1991 SC 371
64. Ibid, 379
65. Case C-51/97 Réunion européenne SA v Spliethoff's Bevrachtingskantoor BV [1998] ECR I-6511
66. Ibid, para 23
67. Ibid, para 19
68. See infra subsection C(1)(c). The European Commission has adopted the “subject-matter” approach by suggesting Art 5(1) applies to representative actions
69. This issue also concerns the limitation imposed by nexus requirements, which is discussed below. See infra subsection C.2
70. See the scope of protection provided by Art 15 of the Brussels I Regulation
71. 71 Brussels I Regulation, Art 16(1): “A consumer may bring proceedings against the other party to a contract either in the courts of the Member State in which that party is domiciled or in the courts for the place where the consumer is domiciled.” Art 16(2): “Proceedings may be brought against a consumer by the other party to the contract only in the courts of the Member State in which the consumer is domiciled.”,
72. 72 Brussels I Regulation, Art 17: “The provisions of this Section may be departed from only by an agreement: 1. which is entered into after the dispute has arisen; or 2. which allows the consumer to bring proceedings in courts other than those indicated in this Section; or 3. which is entered into by the consumer and the other party to the contract, both of whom are at the time of conclusion of the contract domiciled or habitually resident in the same Member State, and which confers jurisdiction on the courts of that Member State, provided that such an agreement is not contrary to the law of that Member State.”,
73. Case C-89/91 Shearson v TVB [1993] ECR I-139, para 18
74. Examples can be found in numerous US cases: In re DirecTV Early Cancellation Litigation, 2010 WL 3633 079; Ruhl v Lee's Summit Honda, 2010 WL 3441 256; Fensterstock v Education Finance Partners, (2010) 611 F3d 123, CA2(NY); In re Checking Account Overdraft Litigation 2010 WL 2489 976; Omstead v Dell (2010) 594 F3d 1081; Cohen v Chase Bank (2010) 679 FSupp2d 582; Pendergast v Sprint Nextel (2010) 592 F3d 1119; Cicle v Chase Bank USA (2009) 583 F3d 549, CA8(Mo); Kalt-wasser v Cingular Wireless (2009) 350 FedAppx 108, CA9(Cal); Trombley v Bank of America (2009) 636 FSupp2d 151; Stachurski v DirecTV (2009) 642 FSupp2d 758; Keefe v Allied Home Mortg (2009) 393 IIIApp3d 226; Credit Acceptance v Davisson, (2009) 644 FSupp2d 948; Dalie v Pulte Home (2009) 636 FSupp2d 1025; Oestreicher v Alienware 2009 WL 9023 41; Adler v Dell 2009 WL 6468 85; Murphy v Check ‘N Go (2007) 156 CalApp 4th 138; Lozano v AT & T Wireless Services (2007) 504 F3d 718
75. 75 Art 17 of the Brussels I Regulation
76. 76 93/13/EEC. Art 6(1) further provides that “Member States shall lay down that unfair terms used in a contract concluded with a consumer by As seller or supplier shall, as provided for under their national law, not be binding on the consumer and that the contract shall continue to bind the parties upon those terms if it is capable of continuing in existence without the unfair terms.”
77. 77 Art 3 of the Unfair Contract Terms Directive. Art 3(1) provides “[a] contractual term which has not been individually negotiated shall be regarded as unfair if, contrary to the requirement of good faith, it causes As significant imbalance in the parties' rights and obligations arising under the contract, to the detriment of the consumer.” Art 3(2) explains that “[a] term shall always be regarded as not individually negotiated where it has been drafted in advance and the consumer has therefore not been able to influence the substance of the term, particularly in the context of a pre-formulated standard contract.”
78. COM(2008) 794 final
79. Ibid, para 58
80. Eg Hess, supra n 7, 118
81. 81 See Art 16 of the Brussels I Regulation
82. 82 Suppose all the consumers but one have their domiciles in England and the only non-English consumer has his domicile in Ireland. They have similar contractual claims against the same defendant, a German company. A group action brought by all the consumers cannot be brought in England because an English court has no jurisdiction to hear the dispute between the Irish consumer and the Germany company. If they want to bring an action covering all claimants, the group action can only be brought in the defendant's domicile; otherwise the Irish consumer cannot join the action
83. 83 Such as jurisdiction over multiple-defendants in Art 6(1)
84. It was held in Case C-381/08 Car Trim GmbH v Key Safety Systems Srl [2010] ECR (not yet reported) that the place of delivery was the place “where the goods were physically transferred or should have been physically transferred to the purchaser at their final destination” (para 60)
85. Case C-386/05 Color Drack GmbH v Lexx International Vertriebs GmbH [2007] ECR I-3699
86. Ibid, para 45
87. Ibid, para 16
88. Case C-204/08 Rehder v Air Baltic Co [2009] ILPr 44
89. Case C-19/09 Wood Floor Solutions Andreas Domberger GmbH v Silva Trade SA [2010] 1 WLR 1900
90. Case C-204/08 Rehder, supra n 88, paras 37–38
91. Ibid, paras 39–44
92. Case C-19/09 Wood Floor, supra n 89, paras 24–29
93. Ibid, paras 38–42
94. Case 266/85 Shenavai v Kreischer [1987] ECR 239, para 19. But these decisions are inconsistent with others, eg Case C-420/97 Leathertex Divisione Sintetici SpA v Bodetex BVBA [1999] ECR I-6747. For more discussion, see infra subsection (2)
95. Rehder, supra n 88, para 37; Wood Floor, supra n 89, para 37
96. Rehder v Air Baltic only says “The factors on which the Court based itself in order to arrive at the interpretation set out in Color Drack are also valid with regard to contracts for the provision of services, including the cases where such provision is not effected in one Member State” (para 36). Regardless of the lack of justification in Rehder v Air Baltic, this decision has been followed in the later ECJ decision in Wood Floor v Silva Trade
97. Color Drack, supra n 85, para 32
98. Ibid, para 33
99. Ibid, para 34
100. Ibid, para 35
101. For more criticism, see M, George and J, Harris, “Service Contracts, Carriage by Air and the Brussels I Regulation” (2010) 126 Law Quarterly Review 30, 34
102. Case C-68/93 Shevill v Press Alliance [1995] ECR I-415
103. Case 21/76 Bier v Mines de Potasse d'Alsace [1976] ECR 1735, para 11
104. Shevill, supra n 102, para 33
105. Case C-420/97 Leathertex Divisione Sintetici SpA v Bodetex BVBA [1999] ECR I-6747
106. Ibid, paras 39–40
107. 107 See subsection 2(a) above.,
108. Eg CMV, Clarkson and J, Hill, The Conflict of Laws (Oxford University Press, 3rd edn, 2006), 75: “The jurisprudence spawned by the original version of article 5(1) suggests that the English court has jurisdiction under article 5(1)(b) only in relation to disputes arising out of goods which were (or should have been) delivered in England, even if similar goods were (or should have been) delivered in another place and the same legal issues arise in relation to both deliveries.”
109. 109 Recitals 11 and 12 of the Brussels I Regulation
110. 110 Recital 12 of the Brussels I Regualtion
111. Hodges, for example, recommended a three-pillar model for EU collective redress, namely encouraging voluntary settlement, regulatory assistance in restitution, and judicial collective procedures. See Hodges, supra n 1, 374–75. See also Consultation Paper, supra n 21, para 42. The UK government, for example, clearly states its preference for settlement and regulatory-oversight approaches to judicial redress. See “UK Government's Response to the Civil Justice Council's Report, Improving Access to Justice through Collective Actions (Ministry of Justice, July 2009)”, at http://www.justice.gov.uk/about/docs/government-response-cjc-collec-tive-actions.pdf, accessed on 6 December 2010
112. The Dutch Civil Code (Art 7:907–10) and the Dutch Code of Civil Procedure (Art 1013–18). For more introduction, see I, Tzankova and DL, Scheurleer, “Class Actions in the Netherlands: Netherlands National Reports“, paras 5 and 12, at http://globalclassactions.stanford.edu/sites/default/files/documents/Netherlands_National_Report.pdf, accessed on 6 December 2010; H, van Lith, “The Dutch Collective Settlements Act and Private International Law” (2010), available at http://www.wodc.nl/onderzoeksdatabase/internationaal-privaatrechtel-ijke-aspecten-van-de-wet-collectieve-afhandeling-massaschade-wcam.aspx?cp=44&cs=6796#, accessed on 3 January 2011, 16–22
113. DES, Court of Appeal Amsterdam, 1 June 2006, NJ (2006), 461; Dexia, Court of Appeal Amsterdam, 25 January 2007, NJ (2007), 427; Vie d'Or, NJ (2009), 448; Shell, NJ (2009), 506; Vedior, Court of Appeal Amsterdam, 15 July 2009, JOR (2009), 325; Converium, Court of Appeal Amsterdam, 12 November 2010–the Dutch version of the last case is available at http://zoeken.rechtspraak.nl/weekoverzicht/default.aspx?details=true&datum_tussen_tm=2010–11–17&rechtsgebieddissplay=Civiel&instantietype=Gerechtshoven&instantie=Gerechtshof%20Amsterdam&searchtype=ljn&ljn=BO3908&u_ljn=BO3908, accessed on 10 January 2011, the English introduction can be found at http://Conflictoflaws.net/2010/jurisdiction-of-the-amsterdam-court-of-appeal-in-the-converium-settlement-case/, accessed on 12 December 2010; W Boom, van and T, Arons, “Beyond Tulips and Cheese: Exporting Mass Securities Claim Settlements from the Netherlands” (2010) 21 European Business Law Review 5; van Lith, supra n 112 19–22
114. Converium, ibid
115. Case C-26/91 Jakob Handte v Traitements Mecano-chimiques des surfaces SA [1992] ECR I-3967, para 15; Base Metal Trading Ltd v Shamurin [2005] 1 All ER (Comm) 17, 27 (CA, per Tuckey LJ); Case C-51/97 Reunion europeenne SA v Spliethoff's Bevrachtingskantoor BV [1998] ECR I-6511, para 17; Case C-334/00 Fonderie Officine Meccaniche Tacconi SpA v Heinrich Wagner Sinto Maschinenfab-rik GmbH [2002] ECR I-7357, para 23; Case C-265/02 Frahuil SA v AssitaliAspA [2004] ECR I-1543, para 24; Case C-27/02 Petra Engler v Janus Versand GmbH [2005] ECR I-481, para 50
116. Art 6(1) of the Brussels I Regulation. For more on the article, see HM, Watt, “Arts 6–7” in U Magnus, P, Mankowski et al, Brussels I Regulation (München, Sellier, 2009), 248ff; ZS Tang, “European Jurisdiction in Multiple Defendant Litigation” (2009) 34 European Law Review 80; Case C-51/97, Réunion européenne SA [2000] QB 690; Case 189/87 Roche Nederland BV v Frederick Primus [2006] ECR I-6535; Case 189/87 Kalfelis [1988] ECR 5565; Watson v First Choice Holidays [2001] Lloyd's Rep 339 (CA); Case 150/80 Elfanten Schuh GmbH v Jacquemain [1981] ECR 1671
117. van, Lith, supra n 112, 36–37
118. A, Briggs, Civil Jurisdiction and Judgments (London, Informa, 5th edn, 2009), 201
119. van, Lith, supra n 112, 37–38
120. R, Polak, “Approval of International Class Action Settlements in the Netherlands”, in The International Comparative Legal Guide to Class & Group Actions 2009. A Practical Insight to Cross-border Class and Group Actions Work (London, Global Legal Group, 2009), available at www.iclg.co.uk, 11; van, Lith, supra n 112, 38
121. van, Lith, supra n 112, 38–39
122. Cf ibid, 39
123. Ibid, 40. This is not As specific problem only for cross-border collective settlement, but an inherent problem of Art 6(1), which does not provide any conditions for who the “anchor” defendant should be and is not concerned whether it grants jurisdiction to the most appropriate forum. See Case C-103/05, Reisch Montage AG v Kiesel Baumaschinen Handels GmbH [2006] ECR 6827; Case C-98/06 Freeport v Arnoldsson [2007] ECR I-3819
124. C-539/03, [2006] ECR 6535
125. J, Stuyck, “Class Actions in Europe? To Opt-In or to Opt-Out, That Is the Question” (2009) 20 European Business Law Review 483, 502; van, Lith, supra n 112, 41
126. 126 Recital 15 of the Brussels I Regulation
127. 127 Brussels I Regulation, Art 27(1): “Where proceedings involving the same cause of action and between the same parties are brought in the courts of different Member States, any court other than the court first seised shall of its own motion stay its proceedings until such time as the jurisdiction of the court first seised is established.” Art 27(2): “Where the jurisdiction of the court first seised is established, any court other than the court first seised shall decline jurisdiction in favour of that court.”,
128. Brussels I Regulation, Art 28(1): “Where related actions are pending in the courts of different Member States, any court other than the court first seised may stay its proceedings.”
129. Case C-406/92 The Tatry [1994] ECR I-5439
130. “The same subject-matter” does not exist in the English, German, Irish and Danish versions of Art 27(1) of the Brussels I Regulation (Art 21 of the Convention), but exists in the other language versions. It is suggested in The Tatry that provision must be construed in the same manner as “the majority of the other language versions in which that distinction is made” (para 38). See Case C-351/96 Drouot Assurances v CMI and Protea, GIE [1998] ECR I-3075, Opinion of AG Fennelly, fn 24
131. Case 144/86 Gubisch Maschinenfabrik v Palumbo [1987] ECR 4861, para 17
132. JL and J, Carruthers, Cheshire, North and Fawcett: Private International Law (Oxford University Press, 14th edn, 2008), 306; The Tatry, AG opinion, para 18; Mecklermedia Co v DC Congress GmbH [1998] Ch 40; Jacobs & Turner v Celsius [2007] CSOH 76, para 46
133. Case C-406/92 The Tatry [1994] ECR I-5439
134. Ibid
135. Case C-351/96 Drouot Assurances v CMI [1998] ECR I-3075
136. Ibid, para 25
137. Ibid, para 19
138. However, Art 28 on related actions may be relevant. See infra subsection 5(b)
139. European Commission, Directorate General Health and Consumers, “Overview of the Results of the Consultation on Consumer Collective Redress”, http://ec.europa.eu/consumers/redress_cons/docs/overview_results_coll_redress_en.pdf, at 6, accessed on 10 September 2010
140. C, Hodges, “Global Class Actions Project: Summary of European Union Developments”, 6, globalclassactions.stanford.edu, accessed on 20 March 2008
141. According to the responses to the Commission's Green Paper, three out of four respondent stakeholders are against the opt-out model. Consumer Policy Evaluation Consortium (CPEC), “Assessment of the Economic and Social Impact of the Policy Options to Empower Consumers to Obtain Adequate Redress—Final Analytical Report on the Green Paper on Consumer Collective Redress” (06/05/2009), http://ec.europa.eu/consumers/redress_cons/docs/feed-back_statement.pdf, at 12, accessed on 10 September 2010; see also Hess, supra n 7, 120. However, in the view of US lawyers, the concern against US class actions is “empirically unclear and might be mythical”. See Hodges, supra n 1, 373; DR Hensler, “The Globalisation of Class Action: An Overview” in D, Hensler, C, Hodges, and M, Tulibacka (eds), The Globalisation of Class Action (The Annals of the American Academy of Political and Social Science, 2009), 622
142. They may also have the same cause of action. The cause of action issue will be discussed below, infra subsection 7
143. Art 28(3) of the Brussels I Regulation; see also recital 15.,
144. Art 28(1) and (2). The Trademark Licensing v Leofelis SA [2009] EWHC 3285 (Ch)
145. The Tatry; Report on the Convention on jurisdiction and the enforcement of judgments in civil and commercial matters [1979] OJ C59/1 (“Jenard Report”), 41; Casio [2001] ILPr 43; Gas-coigne v Pyrah [1994] ILPr 82; Case C-539/03 Roche Nederland BV v Primus [2006] ECR 6535
146. Jenard Report, supra n 145, 41
147. A, Briggs and P, Rees, Civil Jurisdiction and Judgments (London, LLP, 4th edn, 2005), 245; Secret Hotels 2 Ltd v EA Traveller Ltd [2010] EWHC 1023 (Ch)
148. See Hess, supra n 7, 119
149. C-129/92 Owens Bank v Bracco [1994] QB 509
150. Eg in Cooper Tire Co v Shell Chemicals UK [2009] EWCH 2609 (Comm) the application to stay under Art 28(1) was refused because the first seised court was likely to take too long (four years at least) to make a decision
151. Ibid, AG Lenz opinion, para 76
152. See discussion supra subsection C.2
153. 153 Art 28(2): “Where these actions are pending at first instance, any court other than the court first seised may also, on the application of one of the parties, decline jurisdiction if the court first seised has jurisdiction over the actions in question and its law permits the consolidation thereof.”,
154. 154 Art 28(2).,
155. Report from the Commission to the European Parliament, the Council and the European Economic and Social Committee on the application of Council Regulation (EC) No 44/2001 on jurisdiction and the recognition and enforcement of judgments in civil and commercial matters (COM(2009) 0174 final), para 3.5 (“Report on Brussels I Review”)
156. G, Cuniberti, “The First Stage of the Abolition of the Exequatur in the European Union” (2007) 14 Columbia Journal of European Law 371
157. 157 Brussels I Proposal, 4; Green Paper on Brussels I Review, 2–3
158. Brussels I Proposal, 4. For more discussion on the issue, see Cuniberti, supra n 156; G, Cuniberti and I, Rueda, “Abolition of Exequatur: Addressing the Commission's Concerns”, University of Luxembourg Law Working Paper Series, Paper Number 2010–03; P, Beaumont and E, Johnston, “Abolition of the Exequatur in Brussels I: Is a Public Policy Defence Necessary for the Protection of Human Rights?” [2010] IPRax 105; P Beaumont and E Johnston, “Can Exequatur be Abolished in Brussels I Whilst Retaining a Public Policy Defence?” (2010) 6 Journal of Private International Law 249
159. Brussels I Proposal, Art 37(2) excludes judgments obtained
160. “in proceedings which concern the compensation of harm caused by unlawful business practices to a multitude of injured parties and which are brought by i. Astate body; ii. a non-profit making organisation whose main purpose and activity is to represent and defend the interests of groups of natural or legal persons, other than by, on a commercial basis, providing them with legal advice or representing them in court, or iii. a group of more than twelve claimants.” Another area that is excluded is defamation.,
161. Brussels I Proposal, 6. See also “Main Report”, supra n 3, 5
162. Green Paper on Brussels I Review, supra n 16, 3. See eg Regulation 4/2009 on jurisdiction, applicable law, recognition and enforcement of decisions and co-operation in matters relating to maintenance obligations, [2009] OJ L7/1, which harmonises applicable law, provides Aspecial review procedure and, at the same time, abolishes the exequatur
163. Green Paper on Brussels I Review, supra n 16, 2
164. Report on Brussels I Review, supra n 155, 4
165. Centre for Strategy & Evaluation Services, “Data Collection and Impact Analysis—Certain Aspects of a Possible Revision of Council Regulation No 44/2001 on Jurisdiction and Recognition and Enforcement of Judgments in Civil and Commercial Matters (‘Brussels I’)”, 17 December 2010, http://ec.europa.eu/justice/doc_centre/civil/studies/doc/study_CSES_brussels_i_final_17_12_10_en.pdf, accessed on 14 January 2011
166. Art 34(1) and (2). Case C-7/98 Krombach v Bamberski [2000] ECR I-1935
167. 166 Brussels I Proposal, 6, and proposed Arts 45 and 46
168. See supra section 4
169. 168 Brussels I Proposal, 6
170. 169 If there is an ancillary establishment in a Member State, the defendant would be deemed to have a domicile in that Member State. See Art 15(2) of the Brussels I Regulation.,
171. Art 4(1) of the Brussels I Regulation. These approaches differ between each Member State and cannot be discussed in detail here. For a comprehensive study of the residual jurisdiction of each Member State, see A, Nuyts, “Review of the Member States' Rules concerning the ‘Residual Jurisdiction’ of their courts in Civil and Commercial Matters Pursuant to the Brussels I and II Regulation—General Report”, final version dated 3 September 2007, available at http://ec.europa.eu/civiljustice/news/docs/study_residual_jurisdiction_en.pdf, last accessed on 26 September 2010
172. Report on Brussels I Review, supra n 155, 4–5
173. Green Paper on Brussels I Review, supra n 16, 3. See European Commission, “Proposal for a Regulation on jurisdiction and the recognition and enforcement of judgments in civil and commercial matters” (“Brussels I Proposal”), COM(2010) 748 final, 2010/0383 (COD), 7
174. Green Paper on Brussels I Review, supra n 16, 3; Brussels I Proposal, supra n 172, 7
175. Ibid. Brussels I Proposal, proposed Arts 25 and 26
176. This may be another reason to reject the adoption of an opt-out model, which can be considered radical by many countries without Asimilar mechanism and may infringe international courtesy
177. 176 It has been reported by relevant research that the public funds for collective redress actions are scarce and insuffi cient. Some Member States, such as Germany and the UK, provide legal aid to group actions, but it is doubtful whether such financial support is available to consumers in other countries. See Civic Consulting of the Consumer Policy Evaluation Consortium (CPEC), “Study regarding the problems faced by consumers in obtaining redress for infringements of consumer protection legislation, and the economic consequences of such problems: Final Report” (“Part I: Main Report”), 57
178. However, in certain circumstances, lis pendens of collective action in a European court and a third country may be necessary to protect European citizens' access to justice. See section C.4(b)
179. As the general jurisdiction rule in Art 2(1) grants a court broad jurisdiction based on the defendant's domicile. Case 412/98 Group Josi Reinsurance v Universal General Insurance Company (UGIC) [2000] ECR I-5925
180. Supra section C.1(c)
181. 180 Art 5(1)(b)
182. 181 Art 5(1)(b)
183. Jurisdiction may be possible under Art 5(1)(a) if the obligation in question relied on by the claimant is not the delivery of the goods or the provision of the services and the place of performance of that obligation is in an EU Member State: see P, Beaumont, “The Brussels Convention Becomes a Regulation: Implications for Legal Basis, External Competence, and Contract Jurisdiction”, in J, Fawcett (ed), Reform and Development of Private International Law: Essays in Honour of Sir Peter North (Oxford University Press, 2002), 9, 20
184. See supra section C.2(a)
185. Arts 27 and 28. Clarkson and Hill, supra n 108, 97; Case C-129/92 Owen Bank v Bracco (No 2) [1994] ECR I-117
186. Case C-128/01 Owusu v Jackson [2005] ECR I-1383. Cf Re Harrods (Buenos Aires) Ltd [1992] Ch 72
187. Fawcett and Carruthers, supra n 132, 326; Clarkson and Hill, supra 108, 115. Cf Antec Inter national v Biosafety USA [2006] EWHC 47 (Comm), paras 17–26
188. Opinion 1/03, Competence of the Community to conclude the new Lugano Convention on jurisdiction and the recognition and enforcement of judgments in civil and commercial matters [2006] ECR I-1011 45, paras 143–51
189. Ibid
190. 189 Art 4(1)
191. Clarkson and Hill, supra n 108, 96–97; Fawcett and Carruthers, supra n 132, 201–02. The European Commission proposes to provide the courts of Member States with a discretion to apply lis pendens to deal with concurrent proceedings between the Member State and a third country. Brussels I Proposal, 7, and proposed Art 34
192. See infra subsection (3) on the recognition and enforcement issue
193. A Pinna, “Recognition and Res Judicata of US Class Action Judgments in European Legal Systems” (2008) 1 Erasmus Law Review 31, 40; JCL Dixon, “The Res Judicata Effect in England of a US Class Action Settlement” (1997) 46 International and Comparative Law Quarterly 134
194. Pinna, supra n 192, 56–59. For more discussion, see infra subsection C.4(c)
195. C, Hodges, “Global Class Actions Project: Summary of European Union Development”, available at http://www.law.stanford.edu/library/globalclassaction/PDF/EU_Report_2007.pdf, 9, accessed on 4 September 2010; Leuven Report, supra n 8, 268, 290, accessed on 4 September 2010; H, Micklitz and Astadler, “The Development of Collective Legal Actions in Europe, Especially in German Civil Procedure” [2006] European Business Law Review 1473, 1499. But for counter-arguments, see the Leuven Report, Ibid, 290–91
196. Hodges, Ibid; the Leuven Report, supra n 8
197. Art 32 of the Brussels I Regulation provides that “[f]or the purposes of this Regulation, ‘judgment’ means any judgment given by a court or tribunal of a Member State”.,
198. Green Paper on the Brussels I Review, supra n 4, 4. No proposal for reform is made by the Commission in its Brussels I Proposal of December 2010 and they note that most stakeholders want this matter to be dealt with in a multilateral context, at 6
199. FEDSA, supra n 32, 4
200. Report on Brussels I Review, supra n 155, 5; Green Paper on Brussels I Review, supra n 4, 4
201. Recital 32 of the Rome II Regulation, for example, permits each Member State to consider the application of such damages according to the ordre public of the forum
202. CA Paris, 21 September 1995, Recueil Dalloz-Sirey 1996, somm 168. See also Pinna, supra n 192, 53–54
203. No 109,0 1 December 2010 (09–13.303)–Cour de cassation–Première chambre civile; English brief can be accessed at http://Conflictoflaws.net/2010/french-supreme-court-rules-on-punitive-damages, accessed on 9 December 2010
204. [2004] 1 WLR 692
205. Pinna, supra n 192, 51–52. E, Kellman, “Enforcement of Judgments on Blocking Statutes, Lewis v Eliades” (2004) 53 International and Comparative Law Quarterly 1025
206. FEDSA, supra n 32, 5
207. Eg English courts have the power to review whether the foreign court is competent according to English rules by considering the submission to the foreign jurisdiction or the sufficient connection between the debtor and the foreign jurisdiction. See Clarkson and Hill, supra n 108, 134–50; Fawcett and Carruthers, supra n 132, 516–31
208. D, Bassett, “'US Class Actions Go Global: Transnational Class Actions and Personal Jurisdiction” (2003) 72 Fordham Law Review 41. cf Pinna, supra n 192, 58
209. See the “due process” requirement in Art 6 ECHR. See supra section C.4(b)
210. 209 The special difficulty associated with recognition and enforcement of foreign judgments in collective redress has been acknowledged in the Green Paper on Brussels I Review. See the Brussels I Review Green Paper, 2, and fn 6 therein
211. 210 Art 6(1) and (4).,
212. 211 Art 6(1)
213. 212 Art 6(2).,
214. See supra section C.1(b)
215. 214 CPR, Part 19, r 19.10.,
216. OGH 31.3.2005, 3 Ob 275/054v. Micklitz and Purnhagen, supra n 4
217. 216 Only in such circumstances can the chosen law apply systematically to the contract. See Art 6(1) of the Rome I Regulation
218. This situation can be rare in practice, as most businesses simply insert one choice-of-law clause choosing the law of their own habitual residence in all contracts
219. 218 Suppose the group action in n 82 is brought in the defendant's domicile, Germany, the Irish company may not be able to join because there is no choice-of-law clause in their contracts and the Irish law applies to his contract in contrast to English law applying to others', or with a choice-of-law clause choosing German law, but the mandatory rules of Ireland and England differ
220. DG Sanco, “Feedback Statement on Draft Consumer Collective Redress Benchmark Consultation”, 2, http://ec.europa.eu/consumers/redress_cons/docs/feedback_benchmark_en.pdf, accessed on 10 October 2010. Also see in general CPEC, supra n 141, where business representatives primarily support the idea that no change should be made to the current law
221. Leuven Report, supra n 8, para 375
222. FEDSA, supra n 32
223. See supra section C.2
224. See in general the business representative's rejection to radical reform on consumer collective redress in CPEC, supra n 141
225. European Commission, supra n 139
226. See business representatives' response to the Green Paper on Collective Redress in CPEC, supra n 141
227. See supra section C.4(b)
228. Green Paper on Collective Redress, supra n 16, para 59
229. Art 4(1) of the Rome I Regulation provides that in the absence of parties' choice of law, “(a) a contract for the sale of goods shall be governed by the law of the country where the seller has his habitual residence; (b) a contract for the provision of services shall be governed by the law of the country where the service provider has his habitual residence.”,
230. Enhancing consumer confidence and stimulating sound trade conduct are two aims of the internal market. See Consultation Paper, supra n 21, para 1
231. Green Paper on Collective Redress, supra n 16, para 59
232. For the support of the minimum protection approach in European consumer choice of law, see Z Tang, Electronic Consumer Contracts in the Conflict of Laws (Oxford, Hart Publishing, 2009), 251–63
233. See supra section C.6(c); Lewis v Eliades, supra n 203
234. 233 Eg Annex 8 of the “Main Report” has shown the number of collective redress cases reported in different Member States
235. A similar view is reached by M, Danov, “The Brussels I Regulation: Cross-Border Collective Redress Proceedings and Judgments” (2010) 6 Journal of Private International Law 359, 393