Join Us in Our Campaign for a Fair Deal
09th Nov 2018
To European Consumers,
We have arrived at a critical moment for the future of the European Union’s legal system. Earlier this year, the European Commission put forth a “New Deal for Consumers”— a package of legislation that includes a proposal for a pan-EU system for collective action lawsuits.
These lawsuits would look very similar to costly U.S.-style class actions. Though they were billed as an easy way for a group of consumers to seek redress, the reality has been much different.
European consumers don’t just want a new deal – they deserve a fair deal. It’s important that European consumers have a pathway to redress, should they need one. But the current proposal would leave the system wide open to the same abuses that currently plague the American system of class action lawsuits.
As it is currently drafted, the European Commission’s proposal lacks key provisions, or safeguards, that would protect the collective redress system—and consumers— from abuse.
For example, did you know that under the proposed system, lawyers can sign you up for a new lawsuit without your knowledge or permission? Or that in some cases you would not receive any payment from the lawsuit, with the money instead going to a third party?
Those are just a few issues with the proposal, and there are many, many more. Only 13 percent of EU consumers support the current version of the proposal.
In the U.S., I’ve seen how class action lawsuits have warped our legal system. Now that the EU is on the verge of making the same mistakes, my organisation, the U.S. Chamber Institute for Legal Reform, wants to warn European consumers of what may lie ahead.
Here, a consumer receives an average class action award of $32, while the average award for lawyers is $1 million. The European Commission says their proposal will not lead to these outcomes because only “Qualified Entities”, such as consumer organisations, will be eligible to bring claims. However, nothing would prevent law firms from working with or fronting Qualified Entities and still taking a portion of any award.
The Fair Deal campaign is making the case for strong safeguards in the final EU proposal by providing substantive research on collective actions and lessons learned from the U.S. class action system.
Join us as we advocate for a redress system that is fair to all parties involved.
Lisa A. Rickard
President, U.S. Chamber Institute for Legal Reform