A unique ‘carriage dispute’ ruling has resolved a dispute between a legal academic and a trade assocation over the right to act as class representative in the latest collective action against a tech platform. In BIRA Trading v Amazon and Stephan v Amazon, the Competition Appeal Tribunal backed an application by Andreas Stephan, a professor of competition law at the University of East Anglia School of Law, over a rival claim proposed by the British Independent Retailers Association (BIRA).
The ruling in a £2.5bn action against Amazon over alleged abuse of a dominant position is likely to set a pattern for the tribunal’s approach to dealing with competing claims to represent large numbers of ‘opt out’ claimants. It is the first time that the CAT has dealt with a carriage dispute in a separate hearing rather than – ‘at very substantial cost’ -during the course of a claim certification hearing.
Noting that carriage disputes are ‘a relatively new phenomenon in the UK, reflecting the nascent nature of our collective proceeds regime’ the tribunal looked to the experience of courts in Australia and Canada before settlign on a ‘multi-factoral assessment’.
A unanimous judgment led by Mr Justice Roth, acting president, found that relevant factors might include:
- The scope of the proposed class. The tribunal was ‘initially concerned’ by the disparity in estimates of the size of the class: BIRA estimated it would amount to 35,000 UK merchants selling goods through Amazon; Stephan estimated the number at over 200,000.
- The class representative. BIRA, as a trade association, ‘would have the benefit of ready access to its retailer members’. However the judges noted that not all BIRA members sell online and a ‘substantial number’ of class members would not be association members. Stephan, while lacking retail experience, has appointed a ‘high-powered consiultative panel’ including former Supreme Court president Lord Neuberger. The litigation budget ‘provides for substantial payments to the panel members’, the judgment notes.
- Funding and adverse costs cover. Stephan’s litigation funding agreement commits the funder to up to £32m for costs and expenses, BIRA’s to £28m; under Stephan’s arrangement the return to funder Innsworth Capital is ‘substantially higher’. However the tribunal found the funding arrangements of the two applications a neutral factor in choosing between them.
- Scope of the claim. The judges found that Stephan’s approach to be more consistent with the goals of access to justice by capturing more viable claims and ‘this is a powerful factor in their favour’.
One factor not relevant, the judges said, is timing: ‘There is certainly no presumption in favour of the “first to file”.’
Finding that Stephan’s advisers had presented ‘an impressively well-developed and thought-through methodology’, the tribunal concluded: ‘The advantage which we find in BIRA as a class representative is clearly outweighed by the factors which favour Professor Stephan, ie the scope of the claims and the expert methodology.’
Amazon did not attend the carriage dispute hearing. A certification hearing before the CAT is expected this autumn.
