Landmark collective actions in the pipeline

As the UK continues to develop a regime for collective actions against major corporations and institutions, it is unsurprising to see that English courts are increasingly at the forefront of judicial decisions. There is undoubtedly room for improvement: an urgent need to control the complexity and the vast costs of bringing group actions in this jurisdiction. However, the number of landmark cases scheduled for the upcoming year – and the anticipated reversal of the potentially damaging though perhaps overhyped consequences of the PACCAR judgment – demonstrate that the group litigation landscape continues to grow.

What is group litigation?

Group litigation is, in short, litigation where a group of individuals with similar claims collectively pursue a claim against individual or multiple defendants. Although the individuals forming the group share a common grievance, the subject matter of the claims is varied, including consumer redress complaints, securities claims, business interruption insurance claims, and environmental claims. The wide range of possible claims is reflected in the manner in which such claims can be brought. This demonstrates the potential flexibility of the English court system to provide a course of redress to those suffering a loss.

Upcoming and ongoing cases

Ad Tech Collective Action LLP v Alphabet Inc. & Others

In claims of worldwide significance, allegations have been made against Google in the EU, Australia, France and the US. These stem from a decision in 2021 by the French competition authority that Google abused its dominant position in relation to ad tech services by engaging in practices which, it is alleged, wrongly preferred its adtech infrastructure, thus distorting competition which could have exerted pressure on Google to lower its pricing.

In England and Wales, proceedings have been brought by Ad Tech Collective Action LLP against Alphabet Inc., Google LLC, Google Ireland, and Google UK on behalf of UK businesses which, the claimants allege, have been harmed by Google’s practices. The claim is valued at about £13.6bn. Economic analysis produced for the claim suggests that Google’s conduct could have reduced publisher advertising revenues by up to 40%. (A Google spokesperson says the company ‘works constructively with publishers across Europe’ to ‘help millions of websites and apps fund their content, and… reach new customers’.)  Similarly to the BT litigation (see below), the claim is being brought on an ‘opt-out’ basis. The certification hearing due to commence on 8 May will ultimately determine the eligibility of the claimants to represent the affected parties and proceed to trial to seek damages.

Telecommunication claims

Justin Le Patourel v BT Group PLC

The founder of consumer group Collective Action on Land Lines, Justin Le Patourel, has brought forward a landmark £600m claim against BT Group on behalf of 2.3m landline-only customers. Patourel’s claim, which was brought to trial on 29 January 2024 and was expected to last eight weeks, constitutes the first collective action under the ‘opt-out’ regime. The claim alleges that BT engaged in unfair pricing practices which resulted in customers being overcharged. BT is contesting the claim on the grounds that it is based on a ‘technical’ issue resolved by Ofcom in 2017.

Justin Gutmann v Hutchison 3G UK Ltd/Telefonica UK Ltd/EE Ltd and BT Group PLC/Vodafone Ltd and Vodafone Group PLC

Spearheaded by former Citizens Advice executive Justin Gutmann, this claim targets the UK’s major mobile network operators, including Three, O2, EE and Vodafone, for the imposition of ‘loyalty penalties’ on customers beyond contract lengths. The claim was filed at the Competition Appeal Tribunal, seeking damages in excess of £3.3bn. Joint case management conferences for these claims are scheduled to take place on 23 May before a full panel. Vodafone is contesting the claim, which a spokesperson described as ‘speculative’.

Environmental claims

Searchflow Ltd and others v Northumbrian Water Ltd and others

The impending judgment in the claim brought by personal search firms is one of a number of group actions being brought against the UK’s major water companies. The claimants contend that Northumbrian Water, Severn Trent, Thames Water and Anglian Water, among others, violated the Environmental Information Regulations 2004 by charging fees for environmental information that should have been provided free of charge. A preliminary issue trial concluded in December 2023. A judgment is expected in the coming months. With a restitution claim exceeding £150m, the case has great significance and could affect industry practices regarding the fees and provision of search reports. Water UK has said the claims are ‘entirely without merit’.

Professor Carolyn Roberts v Water Companies

Professor Carolyn Roberts’ group action against six major water companies alleges the systemic overcharging of customers due to the misreporting to regulators of spills of untreated sewage. As the regulators consider the number of incidents when setting the price the water companies are permitted to charge, Roberts argues that the water companies have been able to charge higher prices, subsequently inflating household bills. Roberts alleges that this amounts to an abuse of a dominant position. A joint case management conference for the claims has been rescheduled for 19 March. A Water UK spokesperson said: ‘This highly speculative claim is entirely without merit.’

Other developments

Legislation that will have the effect of reversing the PACCAR judgment suggests a growing recognition of the importance of group litigation within the UK. The decision in R (on the application of PACCAR Inc and others) v Competition Appeal Tribunal and others has led to uncertainty surrounding litigation funding, as it was held that litigation funding agreements, which entitle the funder to recover a percentage of damages, are damages-based agreements, thus rendering most such agreements unenforceable. Although the funding market moved quickly to address this risk by revising such agreements where necessary, the government this week unveiled legislation to reverse PACCAR. The commitment arises subsequent to increased exposure of the role played by litigation funding in the Post Office Horizon scandal.

 With a number of high-profile, landmark group litigation claims due to be heard in the coming year, and the anticipated legislative response to the PACCAR judgment, the UK group litigation landscape continues to provide an important avenue by which collective redress can be obtained. If that avenue is to remain open for all, however, courts must continue to strive to adopt a pragmatic and cost-effective approach to the operation of such litigation.

Leigh Callaway is a partner at Fladgate LLP and committee member of the London Solicitors Litigation Association. Naiema Begum is a trainee solicitor at Fladgate LLP