Wrestling litigation leviathans – Summarising the Court of Appeal's landmark rulings in Trucks and Forex

On 25 July 2023, the Court of Appeal handed down two seminal collective proceedings judgments in the Trucks and Forex proceedings:

• UK Trucks Claim Limited v Stellantis NV (formerly Fiat Chrylser Automobiles NV) & Others and Traton SE & Others v Road Haulage Association Limited [2023] EWCA Civ 875 (Trucks); and
• Mr Phillip Gwyn James Evans v Barclays Bank Plc & Ors and Michael O’Higgins FX Class Representative Limited v Barclays Bank PLC & Ors [2023] EWCA Civ 876 (Forex).

In the Forex judgment, Lord Justice Green noted that in the collective proceedings regime the Competition Appeal Tribunal (CAT) has the task of "bringing order and control to what otherwise risks the unleashing of litigation leviathans". A question to be debated in future cases will be whether the guidance from the Court of Appeal in these two cases helps or hinders that task.

Overview

Both cases involved appeals from certification judgments of the CAT; both involved multiple Proposed Class Representatives (PCRs) seeking to take “carriage” of the same or similar claims; and both were handed down by identically constituted courts.

The Court of Appeal judgments are likely to have a significant impact on the collective proceedings regime in a number of ways. In particular, the judgments assist in clarifying: the test for determining whether collective proceedings should be certified on an opt-in or opt-out basis; the test for determining carriage and how the carriage process should be conducted; and how to resolve potential conflicts of interest within the class. The judgments also contain a number of other important statements (some of which are obiter, in other words indications of judicial thinking but non-binding in terms of precedent) which may have implications for the collective proceedings regime.

Background

By way of brief background on the appeals:

• In Trucks, which concerns follow-on claims from a European Commission finding of infringement relating to anti-competitive exchanges between truck manufacturers, the CAT had held at certification that the Road Haulage Association’s (RHA) application for an opt-in Collective Proceedings Order (CPO) should be certified. Moreover, it held that, while UK Trucks Claim Limited’s (UKTC) application for an opt-out CPO did meet the certification criteria, it would be preferable to only certify one claim and that the RHA’s application was preferred. This judgment was appealed on several grounds by UKTC and two of the respondents to the RHA’s application.
• In Forex, which concerns follow-on claims from a European Commission  infringement decision relating to anti-competitive exchanges between foreign exchange traders at certain banks, the CAT had held at certification that neither the application of Mr Phillip Evans (Evans) nor the application of Michael O’Higgins FX Class Representative Limited (O’Higgins) should be certified on an opt-out basis. However, it would be willing to certify an application on an opt-in basis. The CAT also held that, if it did have to certify one application, it would have preferred the Evans application. This judgment was appealed by both PCRs.

Key issues considered by the Court of Appeal

The Court of Appeal grapples with a range of important questions in these judgments, including:

• Whether the issues in dispute should be dealt with by way of appeal, or judicial review.
• The issue of "carriage", ie, deciding between two competing PCRs.
• How to decide whether opt-in or opt-out collective proceedings are more appropriate in a particular case.
• The application of the so-called "Microsoft test" and the role of pass-on when assessing a PCR's proposed aggregate damages methodology.
• How to deal with the potential for conflict of interest within a class.
• Questions of admissibility and evidential value of other judgments and decisions.
• The extent to which the public interest in wrongdoers not retaining their unlawful gains is one of the policy objectives of the collective proceedings regime.
• The appropriate constitution of the CAT upon remittal.
• The CAT's approach to future certification hearings.

For a more comprehensive analysis of the judgments and these questions, read our original blog post here.  

Key takeaways

The Trucks and Forex judgments both demonstrate the Court of Appeal’s deference to the CAT’s wide discretion when it comes to certification, in particular, as regards carriage disputes, and that the Court of Appeal will not interfere unless there is a clear error of law:

• In Trucks, the Court of Appeal upheld the CAT’s decision that the RHA should be the only class representative certified to act (and dismissed UKTC’s argument that it should have been certified as the sole class representative instead).
• In Forex, the Court of Appeal also upheld the CAT’s decision on carriage and held that Evans (rather than O’Higgins) should act as a class representative, noting that the CAT was "vastly better placed" than the Court of Appeal to reach a view on carriage.

However, on the issue of opt-in vs opt-out, the Court of Appeal did conclude in Forex that the CAT had erred in deciding that opt-in proceedings were more appropriate. While it considered the CAT did have jurisdiction to reach this conclusion in circumstances where both PCRs were only seeking certification of opt-out proceedings, it concluded that opt-out proceedings should have been certified in the circumstances of this case. It is clear from the judgment that while respondents can proactively raise an opt-in argument in future even where claimants bring opt-out claims, the circumstances in which that argument will succeed look increasingly limited. This is true even if the prospective class is comprised of businesses (and particularly if the choice is between opt-out proceedings or no proceedings at all). The case has now been remitted to the CAT for further case management.

The proceedings in Trucks have also been remitted to the CAT, for directions to address a conflict of interest within the RHA’s class, including as to the establishment of sub-classes. The judgment provides a blueprint for how and when to deal with conflicts of interest when a prospective class includes purchasers at different levels of the supply chain.

Both judgments also provide further guidance for the CAT to assist it in considering certification, with a clear indication that the Court of Appeal considers the process can be done more efficiently, and it appears likely that the Court of Appeal will hear fewer appeals of CAT certification and carriage decisions moving forward.

This is a summary analysis based on an in-depth assessment originally published on our blog, Competition Notes. Click here for the extended article.