A professor of law whose bid to lead a collective action against tech giants Amazon and Apple was rejected by the court has been ordered to pay costs of more than £3 million to the would-be defendants.
Consumer law specialist Professor Christine Riefa of the University of Reading was the proposed class representative in a £500m claim on behalf of victims of alleged anticompetitive practices over the sale of Apple products on the Amazon marketplace. However in January the Competition Appeal Tribunal refused to grant a collective proceedings order (CPO) because of concerns over Riefa's role. 'A class representative is not, and cannot be, merely a figurehead for a set of proceedings being conducted by their legal representatives,' the tribunal ruled.
It was the first time that the tribunal had rejected a CPO application on that basis.
In a subsequent order published on Friday, the tribunal ordered Christine Riefa Class Representative Limited to pay interim costs of £1,695,797.16 to Apple and £1,355,347.77 to Amazon within 21 days. The payment to Amazon takes account of £77,171.75 awarded to the proposed representative for the costs of responding to an unsuccessful disclosure application by Amazon.
Following the row over Merricks v Mastercard settlement, the costs order is likely to generate further debate over the legal costs generated by opt-out collective actions in the tribunal.
In the latest ruling in Christine Riefa Class Representative Limited v Apple Inc & Ors, three judges led by The Honourable Mrs Justice Bacon noted that Amazon had originally claimed £3,368,812.94, which included solicitors’ fees of £2,472,337.91, counsels’ fees of £302,758.75 and experts’ fees of £629,784.36. Apple's original claim was £2,697,523.58, including solicitors’ fees of £1,798,418.69, counsel’s fees of £586,592.94, experts’ fees of £311,071.96. The class representative meanwhile claimed £109,397.17, including solicitors' fees of £51,178.50.
Ruling on the papers without a separate hearing, the judges said the substantial solicitors’ fees claimed are 'a reflection, in part, of very high hourly charge out rates'. Amazon’s solicitors charged a top hourly rate of £1,254.78, for example. The relevant Guideline Hourly Rates ranged from £512–£566.
The judgment notes that the claim had after-the-event (ATE) insurance for up to £20 million.
Rejecting a proposal that the costs liabilities could be stayed pending a revival of the action, the judges ruled: 'in the present case the [proposed class representative] has failed entirely in its application for certification and should bear the costs associated with that failure. It is difficult to see how it could possibly be right for costs which have been incurred in these proceedings to be transferred to a future hypothetical claim brought by an entirely different PCR, or a differently constituted PCR.'
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