US Class Actions: Promise and Reality

45 Pages Posted: 26 Sep 2015

See all articles by Christopher Hodges OBE

Christopher Hodges OBE

University of Oxford - Centre for Socio-Legal Studies; Faculty of Law

Date Written: 2015

Abstract

The US class action is the best-known tool of civil procedure for enforcement of mass private rights. It is intended to achieve judicial and procedural economy in civil procedure, and to exert significant pressure on corporate defendants to observe the law. This piece summarises the major empirical evidence on how the mechanism works. It confirms extensive enforcement of law. It also identifies issues of selectivity of case types (especially securities cases brought by investors), high transactional costs and reductions in sums received by claimants, the risk that high economic factors distort the legal merits of settlements, the limited evidence on evaluating the legal merits of outcomes, forum shopping, and aspects of conflicts of interest that have been criticised by European politicians as abusive. The piece notes that these features are predictable consequences of the policy of encouraging widespread private enforcement of law by incentivising intermediaries and reducing risk to claimants. Various questions are noted in relation to the future of collective redress in the different context of the European legal order.

Keywords: Class action; MDL; Deterrence; Empirical evidence; Costs

Suggested Citation

Hodges OBE, Christopher, US Class Actions: Promise and Reality (2015). EUI Department of Law Research Paper No. 2015/36, Available at SSRN: https://ssrn.com/abstract=2665228 or http://dx.doi.org/10.2139/ssrn.2665228

Christopher Hodges OBE (Contact Author)

University of Oxford - Centre for Socio-Legal Studies ( email )

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Oxford, OX1 3UQ
United Kingdom

Faculty of Law ( email )

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Oxford, OX1 3UL
United Kingdom

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