Class formation

Standing

What are the standing requirements for a class action?

A class action in France is ruled by restrictive subjective conditions, in particular regarding the entitlement to act or standing: a class action may only be brought by a duly registered association. In order to initiate a class action, an association must be representative at a national level and approved under articles L811-1 and 811-2 of the French Consumer Code for consumer class actions or approved under article L1114-1 of the Public Health Code according to article L1143-1 of the Public Health Code for health class actions, or approved under article L141-1 of the Environmental Code according to L142-3-1 of the Environmental Code for environmental class actions. In the discrimination field the entitlement to act or stand in a class action may be brought by an association declared for five years and acting in the discrimination field according to articles 86 (discrimination) or 87 and 88 (discrimination at work) of Law No. 2016-1547, Justice of the XXI Century dated 18 November 2016, or by a union acting for the employees according to articles 87 and 88 of Law No. 2016-1547. In the data protection field the entitlement to act or stand in a class action may be brought by an association declared for five years and acting in the data protection field, as well as by unions and users’ associations approved under articles L811-1 of the French Consumer Code according to article 91 of Law No. 2016-1547, Justice of the XXI Century.

In the consumer field, only 15 associations are approved under article 91 of Law No. 2016-1547 as having the authority to file a collective action, whereas in the health field, and in the environmental, discrimination and data protection fields, class action is open to all user-approved associations (with no requirement of representativeness at a national level). The number of associations potentially affected by health, environmental, discrimination and data protection class actions is much more significant than the number of associations able to file the consumers’ class action. Indeed, there are plenty of user-approved associations at a national level and at a regional level. The public authorities will obviously extensively increase the number of people who have the ability to introduce a class action in several fields.

Consequently, only the consumer association and user-approved association or union (as claimant) and the professional (as defendant) may be party to a class action proceeding in France, whereas it must be noted that the consumer or user-approved association is not a legal person. In fact, there is a real substitution between the association that is a party to the class action proceeding and the individual person who will later enjoy the benefit of the class action once they make themselves known to obtain a compensation.

Furthermore, to initiate a class action, the registered association must provide evidence for identical cases of victims (two cases minimum) and for its recognition as a consumer or health user-approved association. Before any judgment, the association must show, using factual proof, that the professional can be held liable. At the same time, the association must substantiate its damage and define the adherence criteria of the group. As the action is initiated, it is relevant to mention that no mandate is given to the association by the victims. Such mandates are given only after the professional has been established as liable.

Participation

Do members of a class have to opt in or opt out of the action? Are class members notified that an action has been commenced on their behalf and, if so, how?

In the consumer field, two types of proceedings for collective action are foreseen by the Hamon legislation: the ordinary procedure (opt-in system) and the simplified procedure (opt-out system).

Ordinary procedure

The Hamon Law created an ordinary procedure (articles L623-4 to L623-13 of the French Consumer Code) that is close to the opt-in procedure. This procedure requires an active approach on the part of the consumer, who has to take the initiative to join a consumer group identified by the judge as the group against which the professional is liable.

During this first step of the proceeding, the judge pronounces on the liability of the professional. The judge first establishes the prerequisites to join the group and the time limit to do so. Members of a class have to opt in to the action. If the consumer does not join the group, then the decision will not apply to him or her.

The time limit to join the class action and ask for financial damages is two to six months starting from the date on which the publicity measures ordered by the judge are completed and effective (article L623-8 Consumer Code). The judge decides which publicity measures should be taken to inform consumers of the decision. The information or publicity measures are carried out by the professional at his or her own cost (article L623-7 of the Consumer Code). The information measures can be taken only once the judgment is no longer subject to a further appeal. The judge also specifies whether the consumers have to opt in with the professional or through the association. During this time, the professionals presumed to be liable will not know how many people they will have to indemnify.

Opting in to the group is the only requirement for a consumer to be compensated. Also, opting in to the group does not imply that the consumer has become a member of the plaintiff association.

As a second step, after the consumers have joined the consumer group in order to obtain a compensation from the professional, the judge who decided on the liability will have to rule in a second judgment on the difficulties that may arise in connection with the execution of the first judgment (articles L623-18 to L623-21 of the Consumer Code). He or she will state in a second judgment on each and every claim for compensation to which the professionals did not accede.

Simplified procedure

The Hamon Law created a simplified procedure (articles L623-14 to L623-17 of the Consumer Code) that is close to the opt-out system. The judge makes a statement on the professional’s liability and may order them to indemnify, directly and individually, the consumers whose identity and number are known without any active approach to those consumers (article L623-14 of the Consumer Code). In this procedure, there is no time limit for the consumer to accept the compensation. This procedure is relevant for cases where the company liable has a client file, such as matters concerning insurance or mobile phone contracts. Taking into account the fact that many companies have client files, the simplified procedure is likely to be widely implemented.

In the health field there is only one type of procedure.

Law No. 2016-41 introduces a procedure that differs from the ordinary proceeding provided in the Hamon Law.

Indeed, Phase 1 is similar to Phase 1 provided in the Hamon Law: once informed about the judgment, the users can join the class action by addressing an individual compensation assignment either directly to the guilty defendant or to the claimant association.

Nevertheless, Law No. 2016-41 provides a delayed opt-in system: the judge will fix the deadline for a consumer to join the class action, which cannot be less than six months and not more than five years (article L1143-4 of the Public Health Code); the delay to opt in is thus much longer than in the Consumer Code (two to six months). Furthermore, a user whose claim was not compensated may introduce an individual action before the judge, who rendered the first decision on the liability of the professional, and ask him or her to rule on the compensation of his or her own damage (article L1143-11 of the Public Health Code), whereas articles L623-19 and L623-20 of the Consumer Code only provide that the judge may rule on every difficulty or on the enforcement of the judgment that was not executed by the professional. This procedural divergence takes the specificities of the physical damages and in particular the occurrence delay of some physical injury into account.

In the environmental, discrimination and data protection fields there is only an ordinary procedure (no simplified procedure).

Title V of Law No. 2016-1547, passed on 18 November 2016, known as the Justice of the XXI Century Law, and Decree No. 2017-888 dated 6 May 2017, introduced new articles in the Code of Civil Procedure (articles 826-2 to 826-24) and in the Code of Administrative Justice (articles L77-10-1 and following and articles R77-10-1 and following) and created a common legal framework for the class action proceedings relative to compensation claims introduced before the French civil or administrative court. In a first step, the judge renders a decision on the liability and establishes the prerequisites to join the group and the time limit to do so; there is no maximum delay to opt in fixed by the Law (articles 66 and 85 of the Justice of the XXI Century Law (L77-10-7 Code of Administrative Justice)). The judge decides which publicity measures should be taken to inform the concerned persons of the decision (article 67 and 85 of the Justice of the XXI Century Law (L77-10-8 Code of Administrative Justice)). Furthermore, a user whose claim was not compensated may introduce an individual action before the judge who rendered the first decision on the liability of the professional and ask him or her to rule on the compensation of his or her own damage (articles 71 and 85 of the Justice of the XXI Century Law (L77-10-12 Code of Administrative Justice)). As a second step, after the users have joined the group in order to obtain a compensation, the judge who decided on the liability will have to rule in a second judgment on the agreement found between the parties or on the execution of the first judgment (article 73 and 85 of the Justice of the XXI Century Law (L77-10-14 Code of Administrative Justice)).

Certification requirements

What are the requirements for a case to be filed as a class action?

According to article L623-1 of the Consumer Code and article L1143-2 of the Public Health Code, in order to initiate a class action, the registered association must provide evidence for identical cases of victims (two cases minimum) and for its recognition as a consumer association.

Two consumers or users are theoretically considered as a sufficient number of persons to form a group of consumers or health users. The legal doctrine considers that only 12 consumers are needed to form a group of consumers or health users. The criteria of adherence to the group are defined by the association when the liability of the professional is in question. Once the professional is held responsible, the judge becomes the one determining these criteria.

According to article L623-1 of the Consumer Code and L1143-2 of the Public Health Code, to articles L141-1 and L142-3-1 of the Environmental Code, and to articles 86, 87, 88 and 91 of Law No. 2016-1547, Justice of the XXI Century dated 18 November 2016, only an agreed consumer or health-user association, an association declared for five years and acting in the discrimination field, a union or an association declared for five years and acting in the data protection are authorised to take legal action in order to obtain a compensation.

Furthermore, in the discrimination, data protection and environmental fields according to articles 64 and 85 of Law No. 2016-1547, Justice of the XXI Century dated 18 November 2016, a prerequisite for the introduction of the class action is the sending of a formal notice to the respondent. The class action may thus be introduced only four months after the reception by the respondent of this formal notice requesting him or her to remedy the failure or to compensate the damage.

A class action must be filed on the basis of the group’s common interest.

Regarding the pleading requirements, the class action is introduced by the registered consumer, the union or user-approved association according to the rules laid down by decree of the Council of State (article L623-3 of the Consumer Code and article L1144-1 of the Public Health Code, articles L141-1 and L142-3-1 of the Environmental Code and articles 86, 87, 88 and 91 of Law No. 2016-1547, Justice of the XXI Century dated 18 November 2016) and to the general and special procedural rules applicable in France (articles 56 and 752, 862-2 and following, 905 and 1575 of the French Code of Civil Procedure, article R1143-1 of the Public Health Code and articles L77-10-1 and following and articles R77-10-1 and following of the Code of Administrative Justice and article L211-9-2 of the Judiciary Organisation Code).

The registered association has a summons before the competent high court or administrative court served on the concerned professional by a bailiff or by the secretary of the administrative jurisdiction seized by the claimant. For this proceeding before the competent high court or the administrative court, the association must be represented by a lawyer of the competent jurisdiction.

How does a court determine whether the case qualifies for a class action?

After the introduction of the class action by the registered consumer or user-approved association through summons served on the professional, the proceeding before the high court or the administrative court is governed by the general procedural rules applicable before the high court or the administrative court, respectively.

In general, the proceeding before the high court or the administrative court is a written procedure – the judge sets up a calendar for the exchange of submissions and evidence of claimant and respondent.

There are three different steps in the ordinary class action proceeding, as detailed below.

During the first phase of the proceeding (the liability phase) leading to a first judgment on the liability of the professional, the association has to provide proof that the professional is responsible for a prejudice endured by a group of consumers. Hence, the burden of proof is on the plaintiff, namely, the association.

After a certain amount of time the judge closes the exchange of submissions and evidence and sets up a hearing, at which both parties’ lawyers plead the case.

After the pleading hearing, the judge renders a first judgment on the liability of the professional.

In the consumer field, to render this first judgment, the judge must verify the requirements set by article L623-1 of the Consumer Code regarding the association and the action itself. The judge determines whether the case qualifies for a collective action by analysing the proof provided by the association. For such qualification, the association has to provide evidence that the professional has damaged the group and that a common interest induced by the prejudice may be sought.

The judge first strives for acknowledgment of the veracity of the common interest presented. He or she then decides whether the professional implicated is the one that may be held responsible for the prejudice alleged as having caused the common interest.

This first judgment thus has to address the following points (articles L623-4 to L623-13 of the Consumer Code):

  • admissibility of the class action brought by the registered association according to article L623-1 of the Consumer Code;
  • liability of the professional;
  • definition of the consumer group against which the professional is held liable and definition of the criteria for being considered as belonging to this group;
  • definition of the damages that may be compensated for each consumer or each consumer category constituting the group it defines, and definition of the amount of each damage or of any elements allowing the evaluation of the said damages;
  • definition of the appropriate publicity measures to be taken in order to inform the consumers potentially belonging to the defined consumer group;
  • definition of the time limit within which the consumers may join the collective action to obtain compensation for their damage (two to six months maximum);
  • determination of the modalities for joining the collective action; and
  • determination of the time limit for the payment of compensation by the professional and of the time limit after which the consumers may refer to the judge any difficulties regarding the payment of compensation by the professional.

 

Similarly, regarding healthcare, article L1143-2 of the Public Health Code provides that the judge has to determine in the same decision which physical damages could be compensated for the users of the class action, as well as the class action attachment criteria and the publicity measures to be taken by the professional.

Regarding the discrimination, data protection and environmental fields, the judge also renders a first decision on the liability and establishes the prerequisites to join the group and the time limit to do so. There is no maximum delay to opt in fixed by the law (articles 66 and 85 of the Justice of the XXI Century Law (L77-10-7 Code of Administrative Justice)). Then the judge decides which publicity measures should be taken to inform the concerned persons of the decision (articles 67 and 85 of the Justice of the XXI Century Law (L77-10-8 Code of Administrative Justice)).

An appeal may be lodged against this first judgment regarding liability conforming to the general procedural rules if the total amount claimed is not yet known or is higher than €4,000 (see articles 35 and 40 of the Civil Procedure Code and R211-3 of the Judiciary Organisation Code).

After this judgment, the proceeding enters into the second phase, the ‘compensation phase’, which is conducted by the association between the claimants and the professional, outside the court. The professional must pay compensation to the claimants according to the conditions set out in the above-mentioned judgment.

However, the judge still remains in charge of the case during this second phase of the proceeding.

During the third phase of the proceeding (the ‘implementation phase’), the judge assesses any difficulties relating to the payments of compensation by the professional, states on the execution of the first judgment and proceeds to liquidation of the damages that have not been compensated in a final judgment.

Consolidation

Is there a process for consolidating multiple class action filings?

No process for consolidating multiple class action filings is provided for in the Hamon Law in Law No. 2016-41 of 26 January 2016, or by Law No. 2016-1547, Justice of the XXI Century passed on 18 November 2016. However, an association may voluntarily join another pending proceeding, whereas the judge has no obligation to join the different proceedings.

Furthermore, when a judgment is rendered on a claim brought up using a class action, the decision applies to every association, even the ones that did not file the complaint. Also, associations are considered interchangeable in a proceeding; an association may ask the judge to be allowed to ‘step in the right’ of another association in a proceeding if the latter encounters a lack of funding (see article L623-31 of the French Consumer Code and article L1143-19 of the Public Health Code).

In France there are no mechanisms or resources such as databases that allow plaintiffs and courts to find out about competing actions in other fora and to decide which should progress.