Google faces another class action, and this time it has been accused of contributing to the cost-of-living crisis.
A class action was brought against Google at the UK Competition Appeal Tribunal (CAT), in which Google has been accused of taking advantage of its market dominance by shutting out competition on mobile search engines. It is alleged that advertisers were fighting for their position on the Google search page, which resulted in consumers having to pay higher prices for the goods and services that they purchased, therefore contributing to the cost-of-living crisis.
The action was brought under the representative action scheme which forms part of the class action regime operating in England and Wales.
What are Class Actions?
Class actions allow two or more parties to collectively raise a claim or proceedings in a single action where they have suffered a loss in the same, similar or related way.
Multiple parties raising claims in a single action is not an option that is available worldwide. Nonetheless, a growing number of nations have been implementing procedures that allow them to do so. Although the rules governing the initiation of collective proceedings vary by jurisdiction, class actions are typically initiated as opt-in or opt-opt proceedings. We have previously discussed the difference between the opt-in and opt-out schemes here.
England and Wales operate both an opt-in and opt-out scheme, depending on the nature of the action. Representative class actions form part of the opt-out scheme, whereas Group Litigation Orders (GLOs) are part of the opt-in scheme. We have previously compared the differences between the Scottish and English systems in our earlier blog.
Representative actions came into the spotlight in the case of Lloyd v Google, where the Supreme Court unanimously overturned the decision of the Court of Appeal to allow the representative action to proceed against Google in connection with an alleged breach of data protection regulations.
Despite the expectation of a decrease in data protection breach claims after the Lloyd's ruling, we continue to see a rise in applications to proceed by way of representative action.
Scotland
Class actions, known as Group Proceedings in Scotland, came into effect on 31 July 2020, with the implementation of Part 4 of the Civil Litigation (Expenses and Group Proceedings) (Scotland) Act 2018.
In Scotland, we have an opt-in system. This essentially means that, in order to be part of the class, you will need to opt-in to be included in the action.
Although the 2018 Act, provides for opt-out proceedings, the Scottish Court's rules only allow opt-in procedure. Only time will tell whether Scotland will provide rules to adopt the opt-out procedure.
For more information about group proceedings and links to insights into the potential risks for Scottish businesses, visit our class actions webpage or get in touch with your usual Brodies contact.
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