British class-action costs ‘inexplicably high’
Britain’s Competition Appeal Tribunal (CAT) has refused an application for a collective action over an alleged salmon-production cartel after judges found that the litigation would “principally benefit the lawyers and the funder”.
In a unanimous judgment, the three judges said that the proposed representative, Waterside Class Limited, “had failed to demonstrate that the likely benefits to the class would be proportionate to the very substantial costs of the litigation”.
According to the England-and-Wales Law Society Gazette, they also expressed concerns about “the proposed legal costs of the proceedings, as weighed against the anticipated sums which will be returned to the class”.
The estimated loss, the judgment noted, was between £3.10 and £16.91 per household, figures that were “dwarfed” by the proposed £20 million cost of the proceedings, which was described as “inexplicably high”.
‘Highly profitable activity’
The judgment said that the distribution method proposed “raises immediate concerns about what proportion of damages will be distributed to members of the class”.
The judgment also noted that class representative Anne Heal, the sole director of Waterside Class Limited, was charging £300 per hour, a sum that “vastly exceeds the remuneration that would ordinarily be expected for a person engaged in public service”.
“If the class representative is, by reason of the existence of the claim, engaged in a highly profitable activity, their interests are not the same as those of the class,” the judgment stated.
The CAT did not strike out the claim, however, instead inviting the proposed representative to “reconsider how these proceedings could be reformulated to meet the tribunal’s concerns".