Survey Says US-Style Litigation Coming to UK
Posted Oct 30, 2007 7:19 PM CST
By Martha Neil
Although class actions have long been unique to America, that is starting to change—and fast, one major U.S. law firm is predicting. It is basing this projection, in part, on what potential corporate defendants themselves expect to see happening in Europe soon.
A survey sponsored by St. Louis-based Bryan Cave found that about 60 percent of possible defendants expect class actions to catch on in London within the next three years, albeit at a lower cost to defendants than what their counterparts pay in unsuccessful litigation here in the U.S. Conducted by the Economist Intelligence Unit, the survey also found that approximately two-thirds of respondents expect products liability to be a big focus of such litigation and more than one-third anticipate that some form of U.S.-style contingent attorney fee is likely to be instituted concerning class actions, the law firm explains in a press release.
"The results of this research paint a sobering picture for European companies, especially in the U.K.," says Lawrence Scarborough, a Bryan Cave partner who was scheduled to present the survey findings today at an in-house counsel conference in London. "Businesses that have not examined their contingency plans for such legal action could be placing themselves at great risk, especially as plaintiffs' lawyers are getting better at deploying evidence across jurisdictions."
Potential defendants are gearing up for likely class action litigation, the survey found, by "implementing systems to monitor customer complaints (38 percent), training employers in changing safety rules and directives (36 percent), seeking early settlement of cases that could escalate (33 percent), ensuring that insurance policies cover collective claims (29 percent), implementing corporate early-warning systems (26 percent) and keeping detailed records on product development and testing (25 percent)."
The survey interviewed 240 company executives and lawyers last month.
Notes Legal Week, in an article about the survey: "The results come after U.S. class action specialist Cohen Milstein Hausfeld & Toll—which is currently leading a class action in the U.S. against Virgin Atlantic for its involvement in a price-fixing scandal over fuel surcharges—said it was considering starting the UK’s first collective action, with a number of supermarkets and dairies set to be targeted over alleged price-fixing." An earlier Legal Week article details the class action.
The Cohen firm opened a London office earlier this year, and other U.S. plaintiffs firms are starting to send lawyers to London, too, with the idea that business there, while not yet booming, soon will be, adds the International Herald Tribune. "The change is expected to come amid tougher enforcement of anti-cartel laws in Europe, which included fuel price-fixing case against British Airways and Virgin Atlantic this year. Consumer goods companies are expected to be targeted the most, followed by pharmaceutical firms and banks, according to the study."