A more permissive approach to group litigation?
It is known for excellent and independent judges, flexible procedure, expedient interim applications and, of particular appeal to claimants, the prospect of substantial disclosure and the availability of litigation funding1. For would-be group litigants, there are also a number of procedural mechanisms available: such as group litigation orders, representative actions and the collective proceedings regime for competition claims, as well as the ability to bring multiple individual claims, but in parallel and efficiently case managed together.
That said, the history of group or mass litigation claims in the UK has been somewhat mixed. In this update, we ask whether the UK courts are starting to adopt a more permissive attitude to the kind of preliminary issues that have often plagued mass tort actions and other group claims. Will the restoration of the common law to issues of jurisdiction post-Brexit embolden the UK courts yet further? Are we seeing a new dawn for competition and data breach group claims? We briefly take stock of a few significant recent judicial decisions in addressing these questions below.
Mass tort actions
Several similar so-called mass tort claims have recently come before the UK courts. Each of them involved overseas claimants alleging claims for damages against both a non-UK domiciled subsidiary and its UK domiciled parent company in respect of harm alleged to be caused by the subsidiary.
Green lights to overseas claimants – Okpabi and Vedanta
The most recent judgment was the Supreme Court’s decision in Okpabi and others (Appellants) v Royal Dutch Shell Plc and another (Respondents)  UKSC 3, the subject of one of our previous articles which focused more on the parent/subsidiary liability issues.
Very briefly, on the facts of the case, Okpabi concerned approximately 40,000 claimant Nigerian citizens and two defendants, the Shell Petroleum Company of Nigeria Limited (SPDC) and Royal Dutch Shell Plc (RDS). The claimants alleged that oil leaks from pipelines and infrastructure operated by SPDC in Nigeria caused widespread damage, for which SPDC and RDS were responsible. SPDC is incorporated in Nigeria and is a subsidiary of UK-incorporated RDS. In addition to certain Nigerian law-based claims against SPDC, the claimants alleged RDS owed them a common law duty of care under English law because it exercised significant control over material aspects of SPDC’s operations and/or assumed responsibility for SPDC’s operations.
The Supreme Court decision addressed whether the claimants had an arguable case that RDS owed them a common law duty of care in order to ground jurisdiction against the foreign subsidiary SPDC as a necessary and proper party to the proceedings. A similar issue was addressed in the recent Supreme Court decision of Lungowe v Vedanta Resources plc  UKSC 20 and its guidance was followed and re-iterated in Okpabi (see our separate update on Vedanta).
In short, the Supreme Court found that the High Court and the Court of Appeal had wrongly conducted a “mini-trial”. They had focused too heavily on the substantial volume of evidence presented to them, instead of simply examining whether the claim had a prospect of success, and had wrongly discounted the significance of further evidence that might become available to substantiate the claim. The Supreme Court allowed the appeal, finding that it was at least arguable that RDS had assumed a duty of care, effectively clearing the way for the claim to proceed to a full trial.
As it also stressed in Vedanta, the Supreme Court re-iterated that proportionality is important in relation to jurisdiction issues and the analytical focus should be on the particulars of claim and whether, on the basis that the facts alleged are true, the cause of action asserted has a real prospect of success. Save in instances where allegations of fact are demonstrably untrue or unsupportable, the filing and analysis of extensive evidential material is inappropriate at such an early stage – which is suggestive of a lower threshold/level of scrutiny for claimants in commencing these sorts of claims in future.
However, careful attention will still always have to be paid to the facts of each case as demonstrated by two other recent mass tort, “foreign subsidiary/UK parent” cases: AAA v Unilever plc  EWCA Civ 1532 and Município de Mariana & Ors v BHP Group plc, BHP Billiton plc and BHP Group Ltd  EWHC 2930 (TCC). In AAA (admittedly decided prior to the Okpabi and Vedanta decisions), the Court of Appeal held that the foreign subsidiary had managed its own affairs independently such that responsibility for its actions could not be attributed to the UK parent company. More recently in November 2020 Turner J struck out the BHP claims2 as, amongst other things, advanced and expansive proceedings were already on foot in Brazil and significant compensation funds were also available. The evidence fell far short of establishing that substantial justice could not be in Brazil and rather supported the conclusion that to allow parallel English proceedings would have amounted to an abuse of process.
Nevertheless, Okpabi and Vedanta (as well as Josiya & others: see footnote 1) offer strong encouragement to would-be overseas claimants in mass tort actions that perceived jurisdiction and preliminary issues may now be more readily overcome.
The post-Brexit jurisdictional landscape
Although the jurisdictional landscape post-Brexit is still evolving (and we do not cover governing law or enforceability issues here), it is worth briefly noting that the abovementioned cases proceeded prior to Brexit (or, in the case of Josiya & others, was issued prior to the end of the Brexit transitional provisions), under the then applicable Recast Brussels Regulation. These claims benefited from Article 4 of the Recast Brussels Regulation providing that the proper place for suing the anchor, UK defendant parent companies was in their place of domicile. This will no longer be the case for similar mass tort claims coming before the English courts, with the Brussels Recast Regulation no longer applying post-Brexit. At the time of writing, with the UK’s potential accession to the Lugano Convention still uncertain (and actively opposed by the European Commission), and the 2005 Hague Convention providing no answer to these kind of mass tort claims where there are no jurisdiction clauses to consider, future mass tort claims will be decided under the common law.
The common law’s rules on jurisdiction have traditionally been broad and expansive and should not, in principle, impose a worse starting point for claimants generally. For example, physical service on a prospective Defendant whilst in the jurisdiction has traditionally often been sufficient to seize English jurisdiction. Conversely, Brussels Recast required UK courts to decline jurisdiction in a number of circumstances (e.g. if an entity had a presence in the UK but was domiciled in another Member State, the default position would have entitled the entity to be sued in that Member State).
The “forum non conveniens” doctrine will temper the reach of these rules by seeking to ensure that litigation only proceeds in England if it is the proper forum for the litigation. For example, the location of individual claimants, witnesses and documents in a foreign jurisdiction will militate against England as the proper forum (even if those obstacles are, individually, capable of being overcome with efficient case management and modern technology). That said, it is likely that the availability – or lack thereof – of substantial justice in the foreign jurisdiction will be a significant factor in any forum analysis (providing continuity with judicial comments in Vedanta and BHP).
Competition class actions
Another context where the UK courts’ ability to hear expansive group claims has ignited recently is that of competition class actions.
In Merricks v Mastercard, the Supreme Court confirmed in December 2020 that the initial hurdle for parties to clear in seeking to bring competition class actions in the UK is lower than initially applied by the UK’s specialist tribunal in that case at first instance. We have discussed this in a previous article, but the ruling is likely to breathe new life into the UK’s class action regime. Prior to the judgment, Mr Merricks’ claim - a £14bn class action against Mastercard, the largest damages claim in English legal history - had failed in the Competition Appeal Tribunal (the “Tribunal”) at the critical preliminary “certification” stage. Again, in echoes of the “mini-trial” criticisms levelled in Okpabi, the Supreme Court found that the Tribunal had wrongly demanded too much at the certification stage, particularly in relation to matters such as data availability for use in expert evidence. The case was remitted back to the Tribunal which has now approved the certification of the class in its judgment in August 2021, so allowing the claim to proceed. A backlog of other cases, stayed pending the Supreme Court’s decision, have also been the subject of their own certification hearings, with the judgments awaited at present.
None of the above is to detract from the very significant difficulties often encountered by claimants in these sorts of actions in proving and quantifying loss/damage. All of the cases referred to above related to decisions at the very preliminary stages of those proceedings, rather than substantive decisions on the overall merits, and there remain a number of options open to defendants to put pressure on weak claims of this type.
However, given the direction of travel in mass tort claims and competition collective proceedings referred to above it is possible to detect a slightly more permissive approach to such claims in their early stages. In addition, the Supreme Court’s hotly anticipated judgment in Lloyd v Google – a case with potentially wide ramifications for the scope of representative actions and data protection claims in the UK – is set to be handed down later this year (see our separate article for further detail), so we should be braced for further developments in relation to UK’s approach to mass claims.
These developments, combined with the resurgent common law rules, mean the UK courts are very much open for business as a forum for mass claims.
1 For example, and although not discussed further in this update, see the recent High Court judgment in Josiya & Ors v British American Tobacco PLC & Ors  EWHC 1743 (QB) where the claimants needed to obtain disclosure to properly formulate their claim.
2 Although the Court of Appeal has recently granted permission to appeal against the strike out (see Município de Mariana and others v BHP Group plc and another  EWCA Civ 1156 (27 July 2021)).