12 May 2022
Collective action: Rulings like in the Google case will not help in civil litigation
In two recent judgments, the Competition Appeal Tribunal (CAT) has declined to order the proposed class representative (PCR) to give disclosure of the after-the-event (ATE) insurance premium, most recently in Coll v Alphabet Inc and others [2022] CAT 6, following closely on Kent v Apple Inc [2021] CAT 37.
In Coll, the PCR, Elizabeth Coll, had applied for a collective proceedings order (CPO) pursuant to section 47B of Competition Act 1998 on behalf of around 19.5m consumers said to have suffered losses due to allegedly abusive conduct by various Google entities in relation to app distribution and payment processing services.
The PCR had disclosed the litigation funding agreement, the ATE policy, a litigation plan and a litigation budget but, pursuant to rule 101 of the CAT Rules 2015, requested confidential treatment for part of the litigation funding agreement and ATE policy on the grounds of commercial confidentiality, strategic sensitivity and privilege. Accordingly, the documents disclosed had been redacted. The proposed defendants objected.
Tactical questions
By the time of and during the case management conference, agreement had been reached on many issues but two remained outstanding: the proposed redaction of information about the deposit premium under the ATE policy, and whether the success fee percentage under conditional fee agreements with solicitors and counsel should be disclosed.
Section 47B(8) provides that the CAT may authorise a person to act as class representative only if it considers it is just and reasonable for that person to do so; and rule 78 of the CAT rules sets out the factors to be taken into account, which include whether the PCR will be able to pay the defendant’s recoverable costs if ordered to do so and whether it has prepared a litigation plan which includes any estimate of fees and details of arrangements about costs, fees or disbursements which the CAT had ordered it to provide. Rule 101 defines information which may need to be excluded.
The PCR objected to the point being taken at all, on the grounds that the documentation was to all intents and purposes identical to that in Kent. As a starting point, the CAT held that the proposed defendants were entitled to litigate the question despite Kent, because they could not be regarded as bound by a decision in proceedings to which they were not a party.
However, it cited Mr Justice Jacobs in Tuke v Hood [2020] EWHC 2843 (Comm), in turn citing Lord Neuberger in Willers v Joyce [2016] UKSC 43: puisne judges should generally follow the decision of a court of coordinate jurisdiction unless there is a powerful reason for not doing so.
The CAT in Coll examined and agreed with the approach in Kent to privilege and confidentiality but also looked at and agreed with the CAT’s ruling in BGL (Holdings) Ltd v Competition and Markets Authority [2021] CAT 33: a wide confidentiality regime is prejudicial to and at odds with the principle of open justice.
The starting point must be that the whole of a proposed class representative’s funding arrangements are relevant to assessment of an application for a CPO. Thus, subject to issues of privilege or confidentiality, the presumption should be that if the litigation funding arrangement or ATE policy is relevant, then all of its terms are relevant and redaction must be properly justified.
An order maintaining confidentiality may be made, however, not just where information is privileged but also where another party might gain an “unfair tactical advantage” in relation to the litigation, noting that this formulation stressed the need to identify both the tactical advantage said to arise from disclosure, and the element of unfairness that would result should disclosure be required. The term “strategic sensitivity” should not lead to dilution of these requirements.
Unfair advantage
On the facts, the CAT held that the deposit premium in Coll, as in Kent, should remain redacted. ATE premia were possibly subject to legal advice privilege and, if not, disclosure might give rise to an unfair technical advantage because they reflected the insurer’s assessment of the merits. Here the deposit premium was not relevant to the issues to be determined at the hearing for the CPO, and further there was a risk of giving an unfair tactical advantage to the proposed defendants if disclosure were given.
Should it be appropriate to revisit the issue at some future point, the CAT did not consider that the proposed defendants would be prevented from making a further application, or the CAT from raising the point of its own motion.
The CAT stressed that that it was incumbent upon a PCR, if it wished to seek confidential treatment, to make its request clearly in writing and to provide clearly and specifically articulated reasons why the release of the relevant documentation or information will, or might, cause material harm.
The CAT also decided that the proposed defendants had not made out a case for being provided with information about success fees. As the CAT pointed out at [22], the collective proceedings regime is quite different from general civil litigation under the CPR.
It seems unlikely that the decisions in Coll and Kent would assist in decisions in such general civil litigation. They are, however, of great importance in the high-stakes world of the CPO regime.
This article was first published in 39 Essex’s 3+9=Costs newsletter
Judith Ayling QC is a barrister at 39 Essex. She was a junior for UKTC in PACCAR and others v (1) RHA (2) UKTC [2021] EWCA Civ 299.