First competition law class action issued in the CAT

On 21 June 2016 the Competition Appeal Tribunal (CAT) published details of the first application to bring a class action under the UK's controversial new competition law collective proceedings regime. The regime was introduced in October 2015 (see here) and allows representatives to bring collective proceedings in the CAT on behalf of consumers or businesses. Claims can be brought on either an opt-in or an opt-out basis subject to certification from the CAT: in opt-out cases the claim can be brought on behalf of a defined group, and aggregate damages awarded to the group, without the need to identify all the individual claimants and specify their losses. UK claimants within a class are automatically included in an action unless they take specific steps to opt-out.

Having threatened to bring an action earlier this year, lawyers for Dorothy Gibson, the General Secretary of the National Pensioners Convention (NPC), have now issued an application for an opt-out collective action seeking damages from Pride Mobility Products Limited on behalf of purchasers of Pride-branded mobility scooters. Despite it being widely expected that the first collective actions would be brought in cartel cases, the NPC claim instead relates to a form of resale price maintenance. It is based on a decision of the Office of Fair Trading, now the Competition and Markets Authority, in which the OFT found Pride had infringed competition law by prohibiting its retailers from advertising prices online below its recommended retail prices.

According to the CAT's summary of the  application (see here), the proposed class is any person who purchased a new Pride mobility scooter in the UK in a specified period, and the issue common to all class members is whether the relevant infringements raised prices for consumers, and if so by how much. The application argues that the claim should be certified on an opt-out basis given the low level of individual damage and the vulnerability of affected customers. It also notes that the class members are easily identifiable, and that as they are final consumers there are no issues of passing-on that might complicate the analysis. The level of individual damages claimed, and potential difficulties in bringing individual claims, as well as the fact that the class members are final consumers, are likely to be important factors in the CAT's analysis of the application.

The next step will be for the CAT to hold a Case Management Conference to hear arguments on whether the collective action should be certified and if so on what basis. The CAT's decision will be closely watched, and the approach it takes is likely to have a significant impact on claimants' appetite to bring claims under the new procedure.

For a more detailed briefing from our Competition Disputes team please click here.