The opt-in model proposed requires consumers, or class members, to “join” a suit actively to claim compensation. However, where only minor damages can be claimed, the report suggests that an opt-out model may come into play – opt-out meaning that an action is brought against a trader or the like on behalf of all consumers which, if settled in favour of the latter, entitles all the affected consumers to claim damages. The Committee further recommends that the Danish Consumer Ombudsman [DCO] be authorised to present collective claims of this kind in court until further notice.
The DCO, Hagen Joergensen states: “I am very pleased with the recommendations outlined in the report. As empirical evidence shows that only few consumers bring forward claims of damages because legal costs often exceed the compensation awarded, class action lawsuits will make it possible to guard even more consumers against misleading marketing practises. Hopefully the parties heard will back up the motion.”
The model suggested resembles the one that may take effect in Norway in 2007, but class action is widely known and used, for instance in the Americas.
However, consumers are not the only ones who may benefit from the possibility of filing class action lawsuits. The Administration of Justice Committee holds the opinion that distributors who incur a loss as a result of a competitor’s misleading marketing activities may also wish to claim damages this way. This also applies to cases where a number of distributors lose a contract with a company. The recent cartel problems in the Danish heating and sanitation business serve well to illustrate why it may be necessary to be able to file class action lawsuits: Consumers should not be left to fend for themselves when it comes to unlawful price coordination.
As noted above, the report will now undergo a public hearing. If endorsed, a bill concerning class action might be introduced into the Danish Parliament next year.