A new report from global law firm CMS finds that 121 claims were filed in 2022 alone, up from 55 in 2018, and that no sector is immune.
The legal landscape in Europe is witnessing an unprecedented surge as the number of class actions continues to skyrocket, according to global law firm CMS’ 2023 European Class Action Report.
An astounding 121 claims were filed in 2022 alone, with notable figures from the preceding years—55 in 2018, 72 in 2019, 119 in 2020 and 120 in 2021—underscoring the steadfast growth and marking a trend that seems set to endure.
As the Representative Actions Directive (RAD) takes hold across member states of the European Union, the continent braces for a tidal wave of consumer-driven legal movements. This monumental shift over the past five years not only illustrates the internationalisation of class actions but also underscores the growing risk that businesses across all sectors face.
The report also demonstrates the burgeoning accessibility of litigation funding for class actions across Europe. For instance, the rise in collaboration between claimant law firms and third-party funders is facilitating greater awareness and accessibility to litigation funding. Technological advancements are also streamlining the co-ordination of large-scale class actions.
Kenny Henderson, partner at CMS, said: “Our comprehensive data demonstrates the relentless march of class action risk across Europe. 2023 emerges as a pivotal juncture, particularly as European Union member states were bound by the obligation to integrate the minimum provisions of the RAD into their national legislations by June 25. Although not all member states have met this deadline, and varying degrees of consistency mark those that have, the overarching message remains unambiguous: no sector remains unaffected to the far-reaching impact of mass litigation. The same goes for the UK, which remains the highest risk jurisdiction in Europe for class actions.”
CMS’ analysis of the key trends in class action filings for the year 2022 and preceding years revealed the following:
- Continued growth in class actions: The report underscores the steady growth in class action filings across Europe, reflecting the internationalisation of these actions and the escalating risk that they pose. Figures show a continuous rise in claims: 55 in 2018, 72 in 2019, 119 in 2020, 120 in 2021 and 121 in 2022.
- Diverse trends in types of claims: It reveals that no sector remains immune to class actions, with the financial services (+71 per cent), consumer products and life sciences (+44 per cent), tech (+33 per cent) and data protection (+38 per cent) sectors experiencing unique shifts in claims patterns in 2022.
- Quantifying class actions impact: A significant addition to this year’s report is the data on claimed quantum in issued class action claims, focusing initially on the UK and the Netherlands, which revealed staggering numbers. As of 2022, class actions in the UK seek more than $120 billion, with almost half of the value of the UK’s class actions (approximately 48.4 billion US dollars) found in the mining, energy and transport sector, followed by financial products/professional services (approximately 31.6 billion euros) and technology (approximately 17.3 billion euros). In the Netherlands, technology and consumer claims dominate, comprising 95 per cent of total quantum. Strikingly, financial product claims in Dutch class actions make up just one per cent of the claim value.
- Five-year snapshot of claims across diverse range of jurisdictions: Whilst the UK, the Netherlands, Germany and Portugal remain at the forefront of class action filings, comprising 76 per cent of all actions, the report identifies emerging trends in less traditional jurisdictions. The inclusion of France, Slovenia, Austria, North Macedonia, Romania and Sweden, alongside the aforementioned top performers, underlines the evolving landscape. Spain, Italy, Croatia, Scotland, Poland, Norway and Montenegro collectively account for approximately five per cent of overall claims.
- Emerging jurisdictions show growth: Whilst the UK and the Netherlands continue to be dominant, Germany and Portugal exhibit strong growth trends of around 70 per cent and 100 per cent, respectively, over the past five years. Remarkably, Slovenia experienced a substantial increase in class actions in 2022 (15 claims), driven by a surge of claims against financial institutions related to consumer credit contracts and interest calculation practices.
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