News In Focus 12 September 2023

Wistrand partner Jörgen Eklund and associate Lisa Hedbäck contributes to CMS European Class Actions report

The European Class Action report, produced by CMS, provides comprehensive insight into the landscape of class action litigation. The legal landscape in Europe is witnessing an unprecedented surge as the number of class actions continues to skyrocket, according to the report, with 121 claims filed in 2022, up from 55 in 2018. With the Representative Actions Directive’s adoption in EU states, Europe expects a surge in consumer legal action. However, Jörgen Eklund and Lisa Hedbäck, who contributed to the report, state that since the Group Proceedings Act (2002:599) came into force in 2003, there have only been a few class actions per year in Sweden. The proposed act on class actions for the protection of the collective interests of consumers, which implements the Representative Actions Directive, is deemed to improve consumers’ access to justice and lead to a higher level of consumer protection.

See below for a summary of the report.

Europe and UK continue to see record-high number of class actions

In an effort to provide comprehensive insights into the landscape of class action litigation, CMS, a leading global law firm, has released its annual European Class Actions report detailing the prominent trends in class action filings for the year 2022 and the preceding years.

The report delves into various aspects, including overall numbers of claims, geographical distribution, types of claims, and industry-specific focus. It is the only study to analyze data from class action proceedings across Europe and to map a true picture of class action risk.

Key highlights from the report include:

  1. Record Numbers of Class Actions in Europe and the UK

The data reveals a persistent surge in class action filings across Europe and the UK. Over the past three years, the number of claims has consistently reached unprecedented levels, with this year witnessing a staggering 121 claims filed. This surge comes as the Representative Actions Directive is poised to be implemented across the EU, indicating a potential for further increases in the years to come.

Notable figures from previous years include: 2018 (55 claims), 2019 (72 claims), 2020 (119 claims), and 2021 (120 claims).

  1. Quantifying Class Actions Impact

European class actions are on the rise, but distinctions abound. This year, we introduce a groundbreaking addition to our report: data on claimed quantum in issued class action claims, focusing initially on the UK and the Netherlands.

  • UK: Class actions seek €100 billion+, led by tech and finance, with notable mining and energy sector impact.
  • Netherlands: Tech and consumer claims dominate, comprising 95% of total quantum. Strikingly, financial product claims in Dutch class actions make up just 1% of the claim value.
  1. Five-Year Snapshot of Claims Across Jurisdictions

While the UK, the Netherlands, Germany, and Portugal remain at the forefront of class action filings, comprising 76% of all actions, the report identifies emerging trends in less traditional jurisdictions. The inclusion of France, Slovenia, Austria, North Macedonia, Romania, and Sweden, alongside the aforementioned top performers, underlines the evolving landscape. Spain, Italy, Croatia, Scotland, Poland, Norway, and Montenegro collectively account for approximately 5% of overall claims.

  1. Noteworthy Growth in Emerging Jurisdictions

A significant shift in claim filing numbers has been observed in the past year. While the UK and the Netherlands continue to be dominant, Germany and Portugal exhibit strong growth trends of around 70% and 100%, respectively, over the past five years. Remarkably, Slovenia experienced a substantial increase in class actions in 2022, driven by a surge of claims against financial institutions related to consumer credit contracts and interest calculation practices.

  1. Diverse Trends in Types of Claims

The report underscores the prevalence of three key claim types:

  • financial products/securities (31%)
  • competition (26%)
  • product liability consumer law and personal injury (24%).

These categories have reached historical peaks simultaneously. However, the report identifies a relative decrease in data protection class actions. Despite this, data protection claims remain a focal point for businesses, showcasing lower growth compared to other claim types.

  1. In-Depth Analysis of Competition Claims

The report highlights competition claims as a high-risk area, with 2022 surpassing the previous year’s record. The UK emerges as the riskiest jurisdiction for competition class actions.

  1. Sector Focus and Implications

From financial services to tech and beyond, industries are experiencing unique shifts in claims patterns.

  • Financial Services – A surge in financial products, shareholder, and facilities claims (+71%)
  • Tech Industry – Rise in competition (+33%) and data protection claims (+38%)
  • Consumer Products and Life Sciences – Soaring products liability/consumer law, and personal injury claims (+44%)

Read the full report here.