Court of Appeal overturns CAT's refusal to certify the MasterCard collective action claim

In its judgment of 16 April 2019 the Court of Appeal overturned the Competition Appeal Tribunal's (CAT) decision refusing certification in the MasterCard collective action claim and remitted the case back to the CAT for a re hearing. The CAT's refusal to certify the claim and grant a Collective Proceedings Order (CPO) had been based on two principal reasons: the lack of availability of the sort of data that would be necessary for the applicant to prove that any overcharge had been passed on to consumers and the level of this, and the fact that the CAT did not see a plausible way of calculating the loss each individual claimant suffered at the distribution stage.

On the issue of overcharge, the Court of Appeal held that the CAT's approach to the expert evidence was based on a misdirection. The appropriate test should have been whether the CAT was satisfied that the proposed methodology is capable of or offers a realistic prospect of establishing loss to the class. At certification stage it was not necessary for the proposed representative to be able to produce all the evidence and data available to operate that methodology or to enter into a detailed debate about its probative value. Certification is a continuing process and a CPO may be varied or revoked at any time, so the CAT could always terminate a CPO if it subsequently transpired that the claim lacks sufficient data to calculate the rate of pass-on.

On distribution of damages the Court of Appeal held that the CAT had been wrong to consider that the aggregate award had to be distributed according to what each individual claimant had lost. It found that there is nothing in the legislation or the CAT Rules which requires aggregate damages to be distributed on a compensatory basis, and distribution is in any case a matter for the trial judge to consider following the making of an aggregate award, not for the CAT at certification stage. The Court of Appeal also referred to the rationale behind the legislation that introduced the collective actions regime, which was "to facilitate a means of redress which could attract and be facilitated by litigation funding, and had Parliament considered it necessary to limit this new type of procedure by what would be required for the assessment of damages in an individual claim, it would have said so".

Read the full briefing here.

Contacts