Class action: how does it work in practice? The stages of the procedure

You have read our previous articles and you think that a situation you have experienced, or of which you are aware, could fall within the scope of a group action. A defective product, a systematic discriminatory practice, a massive breach of personal data... But beyond identifying the problem, how does such legal action actually work in France? What are the main stages, deadlines and points to watch out for?

Although the aim of group action is to simplify the defence of the interests of many victims, it remains a complex legal procedure with its own rules. While a general framework was laid down by the 2016 law on the modernisation of justice in the 21st century (known as the "J21 law"), there are still significant variations depending on the area concerned (consumer, health, discrimination, environment, personal data).

The aim of this article is to guide you through the key stages of a group action in France, highlighting the common points and the main procedural differences you may encounter.

The preliminary stage: formal notice (when required)

Even before taking a case to court, a preliminary step may be required: formal notice. This has a dual purpose: to officially inform the person or company in question of the alleged breach and of the intention to take group action, and to give them time to try to resolve the problem amicably (putting an end to the breach, proposing compensation).

When is it compulsory?

• Mandatory for group actions brought on the basis of the J21 law (article 64), i.e. for actions relating to general discrimination, the environment and personal data. A specific formal notice procedure also applies to discrimination at work (article L. 1134-9 of the French Labour Code).
• Optional (not required by law) for group actions in the field of consumption and public health. In such cases, the association may refer the matter directly to the court.

How does it work?

The authorised association or trade union must send a letter of formal notice to the person responsible (by a means that allows the date of receipt to be proven, such as recorded delivery with acknowledgement of receipt). This letter must clearly state the alleged breach and request that it be remedied and/or that the damages be compensated.

A waiting period is then required before the matter can be referred to the courts:

• 4 months from receipt of the formal notice for "J21 ordinary law" actions (general discrimination, environment, personal data).
• 6 months from the date of the request for the action in discrimination at work (unless the employer explicitly rejects the request beforehand). This longer period is linked to an internal procedure for discussion with the CSE and the trade unions which the employer must (theoretically) initiate.

What are the penalties if the formal notice is forgotten or the deadline not met?

This is a no reply. This means that if the action is brought without prior formal notice (where this is compulsory) or before the expiry of the required period, the judge may (and indeed must, if he finds that this is the case) declare the action inadmissible, without even examining the merits of the case. This is a very serious sanction, which underlines the importance of this stage.

Initiating proceedings: who brings the case before which court?

If the formal notice is unsuccessful or not required, the authorised association or trade union may then bring the group action before the courts.

The role of the applicant

It is therefore the association or trade union that is acting as a applicant to the proceedings. It acts in its own name, but on behalf of potential victims (sometimes referred to as a "substitution action"). Individual victims are not parties to the proceedings at this stage. Several authorised associations may act jointly.

Which jurisdiction should I take?

• Jurisdiction : It is exclusively the Court of First Instance which has jurisdiction over group actions in all areas, including discrimination in the workplace (the Conseil de Prud'hommes does not have jurisdiction over the group action itself).
• Territorial jurisdiction : The action must be brought before the Tribunal Judiciaire du place of residence of the defendant (its registered office if it is a company, or its domicile if it is an individual). If the defendant is abroad or has no known address in France, the Tribunal Judiciaire de Paris has jurisdiction. This rule of territorial jurisdiction is exclusive; the association cannot choose another court (for example, the court in the place where the damage was suffered).

How do I take a case to court?

The action is initiated by a assignmentA writ of summons is a document issued to the defendant by a bailiff. The summons must comply with the usual formalities, but must also contain specific information: it must set out "the individual cases presented by the applicant in support of its claim". (article 849-1 CPC and R. 623-3 C. conso).

The association must therefore identify and describe a number of concrete situations involving victims that illustrate the alleged breach and harm. The aim is not to list all the potential victims (who are not necessarily known at this stage), but to give the judge representative examples to enable him to assess the merits of the collective action. Case law has clarified that the judge (in particular the pre-trial judge) verifies the presence of these cases, but does not have to judge at this stage whether they are sufficiently "representative" of the alleged group.

The judgment on liability: the key decision

This is the first major stage in the legal proceedings. The court will examine the merits of the case to determine whether the defendant committed the alleged breach and whether it is liable for the damage suffered by the group.

This judgement, handed down after the case has been investigated (exchange of conclusions, any expert reports, etc.), is crucial because it will :

1. Ruling on liability of the defendant (company, professional, etc.) in the light of the evidence and the individual cases presented. The judge will decide whether or not the breach is established and attributable to the defendant.
2. Define the group of victims concerned. If liability is recognised, the judge must precisely define the group of people who will potentially be entitled to compensation. To do this, he sets the "criteria for inclusion in the group (for example, "all consumers who bought product X between such and such a date", "all employees who were subjected to such and such a practice between...", "all users who received such and such a medical device in such and such a hospital...").
3. Determining the losses that can be compensated. The judge identifies the types of loss that may give rise to compensation under this action, respecting the limits specific to each field (property/material in consumer matters; physical in health matters; physical/material in environmental matters; material/material in data/discrimination). It may define categories of victims if the losses vary.
4. Set the amount or the valuation method. The judge can either set an amount of compensation directly (if the loss is the same for everyone or can be easily lump-summed), or define the rules and methods for calculating the individual loss of each member of the group in the next phase.
5. Order publicity measures and set deadlines. If liability is found, the judgment orders the necessary measures to inform potential victims and sets deadlines for the next stages (accession, settlement).

This judgement on liability is therefore a complex decision that conditions the entire subsequent procedure.

Information and support for victims: joining the group

If the judgment recognises the defendant's liability, an essential phase begins: informing potential victims and enabling them to join the group to obtain compensation. This is the principle ofopt-in retained in France: victims must actively come forward.

Publicising the decision

The judge orders publicity measures "adapted to inform people likely to belong to the group. These measurements are carried out at the defendant's expense. They can take various forms: publication in the press, posters, information on a website, individual letters if the victims are identifiable, etc.

The content of this information is regulated: in particular, it must reproduce the decision, indicate how and when to join the group, specify that membership constitutes a mandate for the association (if membership is obtained through its intermediary), and inform of the consequences of membership (impossibility of taking individual action for the same loss).

Please note: This publicity only takes effect once the decision on liability has been made. is no longer subject to appeal or cassation. It is therefore necessary to wait until the ordinary remedies have been exhausted, which can considerably delay informing victims and the start of compensation. There is an exception for competition actions, where the judge may authorise earlier publicity.

Enrolment deadline

The judgment sets the period during which victims may join the group. This period varies depending on the action:

• Consumer action : between 2 and 6 months after completion of the advertising measures.
• Health action : between 6 months and 5 years after completion of the advertising measures.
• Other actions (common law J21) : the time limit is set freely by the judge (the law does not stipulate a minimum or maximum).

How can I join?

The victim must indicate his or her wish to join the group in accordance with the procedures set out in the judgment (form, letter, etc.). They must do so within the time limit set. The application must contain the victim's contact details and show that he or she meets the criteria for membership of the group as defined by the judge.

Depending on the judge's decision (and the type of action), the application may be sent to :

• Either to the defendant (It is up to the victim to inform the claimant association of their choice (if there is more than one).
• Directly to the applicant association (or the one of his choice if there is more than one).

Consequences of membership : If you become a member of the association, it will is a mandate for this. The association will then act on behalf of the consumer to negotiate or claim compensation from the party responsible. This mandate may be revoked at any time by the victim, but beware: revocation entails renunciation of membership of the group. Membership of the group never implies membership of the association itself.

If the victim does not join the group within the time limit set, he or she will no longer be entitled to compensation. as part of this group action.

Injury compensation: obtaining compensation

Once the membership period has expired, the actual compensation phase begins. The aim is to ensure that every member of the group receives the compensation to which they are entitled, in accordance with the judgement on liability.

There are two main routes to liquidation (with some exceptions)

For most actions (consumer, general discrimination, environmental), the J21 Act (articles 68 et seq.) and the Consumer Code provide for two ways of organising this redress:

1. The individual redress procedure (default route) :
   • Each member of the group who has signed up (either directly with the person responsible or via the association) makes an individual claim for compensation against the person declared responsible.
   • The person responsible will (normally) pay compensation on the basis of the rules laid down in the judgement.
   • In the event of refusal or dispute by the person responsible (on the membership of the group, on the amount...), the victim (or the association mandated on his behalf) can go back to court who ruled on liability. This judge will then decide individual disputes relating to compensation.
2. Collective proceedings for the liquidation of damages (optional route) :
   • This procedure can only be implemented if the requesting association asks the judge to do so. and if the nature of the damage lends itself to it (homogeneous and easily assessable damage).
   • If the judge accepts this, he authorises the plaintiff association to negotiate directly with the defendant a global agreement setting out the terms and conditions of compensation for the entire group (or sub-groups).
   • This The negotiated agreement must then be submitted to the judge for approval.which checks whether it sufficiently protects the interests of group members.
   • If the agreement is approved, it becomes binding and serves as the basis for compensation. If the negotiations fail or the agreement is rejected, the individual procedure reverts.

Important exceptions:

• For action on public healthof discrimination at work and personal dataonly the individual procedure is applicable. There is no provision for comprehensive collective bargaining in these areas.
• For action on healtha procedure for mediation (described in our previous article) is strongly encouraged and can lead to an approved out-of-court compensation agreement.

Payment of compensation

Whether following individual or collective proceedings, or a mediation agreement, the party responsible must pay the compensation due. Payment can be made :

• Directly to each victim compensated.
• Via the plaintiff associationwhich receives the funds and deposits them in a dedicated account opened with the Caisse des Dépôts et Consignations (CDC). The association then manages payments to victims from this secure account.

If the guilty party refuses to comply, the authorised association may initiate enforcement proceedings.

Mediation: a possible amicable solution?

The law encourages the use of mediation in group actions, as an alternative or complement to legal proceedings.

• General possibility : In consumer matters and for actions governed by ordinary J21 law, the claimant association can always take part in mediation with the party responsible to try to reach an agreement on compensation (articles L. 623-22 C. conso and 75 loi J21). The agreement reached must be approved by the judge in order to be enforceable.
• Specific healthcare process : As mentioned, the French Public Health Code provides for a dedicated and detailed mediation procedure, which can be initiated by the judge with the agreement of the parties (articles L. 1143-6 et seq. CSP).

Mediation can help to reach a solution more quickly and avoid lengthy and costly legal proceedings, but it requires the willingness of both parties (association and manager) to participate and reach an acceptable compromise.

Points to watch: statute of limitations, res judicata, unfair terms

Finally, there are a number of important rules governing group actions:

• Suspension of prescription : Bringing a group action suspends the limitation period for individual actions by potential group members (articles L. 623-27 C. conso and 77 loi J21). This means that a victim is not obliged to act individually "just in case" the group action fails, in order to avoid having his or her right time-barred. The period starts running again (for at least 6 months) once the decision on the group action is final or an agreement is approved.
• Res judicata : The decision handed down in the group action (judgment or approved agreement) has the force of res judicata. This means that :
  • A new group action cannot be brought on the same facts and for the same losses.
  • Victims compensated under the group action can no longer take individual action to obtain compensation for the loss suffered. even prejudice.
  • However, this does not prevent a victim who has received compensation from taking individual action to obtain compensation for the damage suffered.other damage not covered by the group action (for example, non-material damage if only material compensation has been obtained through consumption).
• Unfair terms : Any clause in a contract that has the purpose or effect of prohibiting a person from taking part in a group action is prohibited. deemed unwrittenIn other words, null and void (articles L. 623-32 C. conso and 82 loi J21). This is intended to prevent professionals from circumventing the system through contractual stipulations. However, the application of this rule to arbitration or prior conciliation clauses is still under debate.

Navigating the class action procedure requires a certain amount of legal expertise. Whether you are a potential victim wondering whether you can join a group or how to obtain compensation, or a company implicated in such an action, our firm can advise you on the procedural steps, deadlines and strategy to adopt. Contact us for a consultation.

Sources

• Law no. 2016-1547 of 18 November 2016 on the modernisation of the justice system for the 21st century (Articles 62 to 83)
• Consumer Code (Articles L623-1 et seq., R623-1 et seq.)
• Public Health Code (Articles L1143-1 et seq., R1143-1 et seq.)
• French Labour Code (Articles L1134-6 to L1134-10)
• Environment Code (Article L142-3-1)
• Law no. 78-17 of 6 January 1978 on data processing, data files and individual liberties (Article 37)
• Law no. 2008-496 of 27 May 2008 containing various provisions for adapting to Community law in the field of anti-discrimination (Article 10)
• Code of civil procedure (Articles 849 to 849-21)