On 23 March 2017, the Ghent Court of Appeal in Belgium (the Court of Appeal) handed down a lengthy decision on the civil merits in the very well-known Lernout & Hauspie (L&H) case. Although the judgment rendered by the Court of Appeal is very long and covers various legal issues, it contains a specific section on the recognition, in Belgium, of two American opt-out class action settlements.
As most of you know, class action suits are legal devices that allow an individual or a small group of individuals to proceed in court on behalf of a much larger and unnamed group of individuals who have suffered a similar injury and who share common claims.
While class actions form an integral part of the legal framework in the United States, European jurisdictions (with the notable exception of the Netherlands (see my previous post)) tend to be very cautious with respect to this instrument. It is only in June 2013 that the European Union published a recommendation setting out a series of common, non-binding principles that EU Member States should adopt in order to put collective redress mechanisms in place. Based on this recommendation, some EU Members that previously did not allow for collective redress mechanisms have since introduced them into their legal systems.
In sharp contrast with the American class action system – where any individual who fulfils the conditions to be part of a class action will automatically be considered as part of the class bringing the action, unless that member expressively indicates his desire to be excluded from of the proceedings (i.e. “opt-out” system) – most European systems have adhered to an “opt-in” system where plaintiff classes are formed through the expressed consent of their members.
The case at hand therefore concerns an interesting scenario in which the Belgian court, belonging to a jurisdiction where only opt-in class action are allowed, is asked to recognise a U.S. opt-out class action settlement.READ MORE