Bacon: Inappropriate to include comments
The Competition Appeal Tribunal (CAT) has criticised a leading class action law firm for including in evidence an “offensive personal attack” on its president.
The CAT refused to certify part of the potential collective action against Apple and Amazon, and said the rest could go ahead only if the proposed class representative (PCR) agreed to limit his fees.
The CAT described the fees put forward by Justin Le Patourel as “unreasonable and excessive”, and cut his proposed hourly rate of £200 to £170 and the daily cap from £1,250 to £750.
The Class Representatives Network (CRN) hit back, saying the limits meant the class would “pay considerably less for the person responsible for representing their interests and overseeing the claim than they do for the most junior trainee solicitor or paralegal on their team”.
Part of the evidence about remuneration put before the CAT was an anonymised survey of CRN members conducted by Mr Le Patourel’s solicitors, Hausfeld.
The CAT recorded “disappointment that some of the respondents” to the survey regarded it as “an opportunity to air their views on the management of the tribunal more generally, including in one case an offensive personal attack on the president of the tribunal”, Mrs Justice Bacon, who also chaired this panel.
Asked to explain this, Hausfeld accepted that the response contained “irrelevant and inappropriate commentary” outside the scope of the survey but said that it wanted to present the full results in unedited form.
“We do not accept that explanation,” the CAT said. The survey was put forward as part of formal evidence submitted to the tribunal and was relied upon extensively in Mr Le Patourel’s witness statement.
“It was entirely improper for the PCR and its legal representatives to have included, in that evidence, anonymous material that was not only (as Hausfeld accepted) irrelevant and inappropriate, but was also personally offensive to the president of the tribunal.
“It is also quite extraordinary that someone putting themselves forward as a class representative or prospective class representative, in complex, high-value and high-profile litigation in the tribunal, thought fit to make a comment of that nature in evidence intended to be provided to the tribunal in support of certification of a collective action.”
In January last year, the CAT refused to certify [1] the action because the original PCR was insufficiently independent of her solicitors and funder.
As a result, Mr Le Patourel – who has led other collective actions – took over and reissued the claim.
He alleges that Apple and Amazon reached unlawful anticompetitive agreements which restricted third parties from reselling Apple and Beats products on Amazon.
As a result, consumers paid inflated prices for those products when buying them from UK retailers – whether online or in physical stores, outside of a mobile provider contract, from 31 October 2018 to 15 December 2025. The class has an estimated 29m members.
The PCR estimates the loss suffered by people who bought directly from Amazon, the ‘On-Amazon claim’, as being worth from £289m to £306m with interest, which would mean damages of £37 to £39 per customer.
Damages for those who bought products from other retail outlets, the ‘Off-Amazon claim’, could be four times as much.
The CAT said the class representative was not “and should not become, simply another commercial stakeholder in the proceedings”.
This would “create misaligned incentives, by blurring the line between the class representative and the commercial stakeholders such as the funders and lawyers”.
The litigation funding agreement provided that, if the claim succeeded, backer Asertis could charge a multiplier of 3.9 on a “draw down” of £339,500 in fees for the PCR, meaning that claimants could lose £1.7m of their damages.
The CAT said there were “sound justifications” for a daily cap on the PCR’s fees as a means of controlling costs.
A majority of respondents to the CRN survey were willing to act on the basis of a capped daily rate, with a significant number of those willing to accept a cap of up to £750.
In contrast, it considered the hourly and daily rates proposed by Mr Le Patourel to be “unreasonable and excessive”.
The CAT refused to certify the Off-Amazon claim, on the grounds that it could only place “limited weight” on the expert evidence involved. The evidence should be “treated with caution”, but it “can be relied on” for the On-Amazon claim.
The On-Amazon claim could be certified if the PCR agreed to limit his fees to £170 an hour and £750 a day and there was no recovery of costs relating to the original PCR’s proceedings in any funding, insurance or fee arrangements, as had been mooted.
The CRN said the collective proceedings regime must not make it “uneconomic for individuals with the necessary skills and experience to take on the important and demanding role of class representative”.
It added: “We hope that a consultation exercise will now take place, outside the context of individual contested proceedings.”