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U.K. class action proposals: don't worry about Americanization?

Pending proposals in the English courts would take a large step toward American-style practice by opening up so-called "opt-out" actions, in which class members are automatically counted as plaintiffs unless they go to the trouble of withdrawing their names. In this Times Online column, lawyers Antony Corsi and Ian Pegram dismiss fears of

a deluge of unmeritorious claims brought by aggressive and mercenary lawyers to force settlements from corporate defendants.

The CJC [Civil Justice Council, a law-reform body] is alert to that perceived risk and recommends that group lawsuits are carefully monitored. It proposes that claims should be closely supervised by specialist judges, including court certification that collective action is the most suitable method of resolving a particular dispute. It also recommends fairness hearings to approve any settlements and to protect the interests of all parties.

One hopes the safeguards being planned go farther that this brief description would indicate. After all, the U.S. already has, and has had all along, a certification stage in which judges are supposed to assess the suitability of a case for class action treatment, along with a fairness hearing stage to approve settlements and protect the interests of all parties. The combination of the two has not sufficed to prevent massive abuse.

The only definite departure from U.S. practice on the list is the use of specialist judges. Of course other features of the U.K. system, such as the far greater discouragement given to forum-shopping and the possibility of levying costs against losing parties, also diverge from the U.S. pattern. If abuse fails to materialize under the new rules, it may be these features that deserve some of the credit.

More: Paul Karlsgodt.

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Rafael Mangual
Project Manager,
Legal Policy

Manhattan Institute


Published by the Manhattan Institute

The Manhattan Insitute's Center for Legal Policy.