Under the opt-out regime, introduced a decade ago by the Consumer Rights Act 2015, all potentially eligible people are presumed to be included in the group of claimants unless they specifically ask to be excluded. The cases—typically high-profile and often fiercely contested and involving billions of pounds—have had a low success rate to date. Only one case, Justin Le Patourel v BT Group [2024] CAT 76, has reached judgment, with others settling outside of court, sometimes for drastically reduced sums. Merricks v Mastercard, for example, was launched by Walter Merricks in 2016 on behalf of 44 million consumers, seeking more than £9bn, but eventually settled in December 2024 for £200m.
The Department of Trade and Industry (DTI), which issued a call for evidence this month, 'Opt-out collective actions regime review', said it wants to find the ‘right balance between achieving redress for consumers and limiting the burden on business’. It noted tens of billions of pounds in damages had been claimed and hundreds of millions of pounds spent on legal fees—‘far higher than estimated in the original impact assessment, which estimated the total cost to business to be £30.8m per annum’.
However, David Greene, co-president of CORLA (the UK Collective Redress Lawyers Association), said: ‘The opt-out regime under the Consumer Rights Act is relatively young and like all fresh process regimes, is taking time to bed in.
‘The regime is not perfect but it seems to be early to be reviewing it from a business perspective as the Competition Appeal Tribunal and the Court of Appeal are working their way through the process and a body of law is developing. The flavour of the invitation from the Department suggests that it questions the business case for the opt out process but it remains at its base a procedural option that allows consumers access to justice which should be measured not just by the result of the tribunal process but also the changes in corporate behaviour that eventuate.’
Greene, who is senior partner at Edwin Coe and NLJ consultant editor, said: ‘Neither lawyers nor funders seek to run “speculative” cases and even if they did they would be sifted out at the certification stage. The core issue is corporate wrong which is likely to have already been recognised by regulators and often by the corporation.
‘Whatever the result of the review the vital core must be ensuring access to justice for consumers.’
Interested parties have until 14 October to respond. Find out more here.
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