On 3 March 2014, the Milan Court of Appeal overturned a decision issued by the Court of Milan, which declared inadmissible a class action brought by an Italian consumers' association, Altroconsumo, against a local railway operator named Trenord.
Class actions law in Italy
Class actions law in Italy was introduced by Act no. 99/2009 and came into effect on 1 January 2010. The new provisions are encompassed in the Consumers' Code (Legislative Decree no. 206/2005) under Article 140 bis, titled Class Actions ("Azioni di classe").
Article 140 bis provides that "individual homogeneous rights of consumers and users", as well as "collective interests", may be enforced through class actions, in relation to: (i) contractual rights of a group of consumers/users in homogenous circumstances vis-à-vis the same company (such as standard term agreements); (ii) homogeneous rights of end consumers and final users of a product vis-à-vis the manufacturer (irrespective of a direct contractual relationship between them); and (iii) homogeneous rights of consumers in respect of unfair business practices or anti-competitive conduct. It is worth noting that Act no. 99/2009 also provides that section 140 bis applies only to conduct after 15 August 2009. Following a recent reform, besides seeking redress, claimants can also ask the court to assess and declare a defendant’s liability without necessarily awarding damages.
The first instance decision
Altroconsumo brought a class action to seek compensation for damages suffered by Trenord subscribers on account of severe disruption to rail services between 9 and 19 December 2012.
The class action was declared inadmissible by the Court of Milan on 8 November 2013, as the rights in issue lacked the homogeneity requirement. The Court, inter alia, found that whilst the cause of the disruption was homogenous, this was not the case in respect of the damage suffered by Trenord subscribers. In the Court's view, as the damage was not deemed homogenous, this prevented the Court from deciding the different cases through a single class action proceeding.
The admissibility decision
Altroconsumo appealed the decision issued by the Court of Milan on the ground that the Court had not correctly interpreted Article 140 bis of the Consumers' Code. The Milan Court of Appeals upheld Altroconsumo's appeal as it found that, in assessing the admissibility of a class action, the Court is not asked to verify whether the damage allegedly suffered by claimants is homogenous or identical. Instead, in accordance with the wording of Article 140 bis, the Court must assess whether the rights alleged by the claimants and the grounds thereof are homogenous.
Accordingly, the diversity of the consequences that each Trenord subscriber suffered due to the disruption on the railway service was not relevant in determining the admissibility of the class action; rather, damage is only relevant for quantifying the compensation for each subscriber.
Due to its strict admissibility provisions, class actions law in Italy has not achieved the anticipated success in the years immediately following its introduction. Nonetheless, more recently, this trend seems to be slowly changing and the courts, such as in this case, appear to be more willing to declare class actions admissible and protect consumers' rights.