Thought leadership from our experts

Class actions “à la française”, the new cuisine

Cécile Derycke, Hogan Lovells, France , Hogan Lovells, France

The introduction of a class action mechanism under French law has been discussed for decades.

Contrasting with this long-waited delivery, the last two years have seen a tremendous evolution, with the entrance into force of two types of class actions and some others considered in a bill which is currently being finalised by the French Parliament.

In all these existing and future class action mechanisms, the opt-in system is applied. Each claimant who wants to be part of the class must take a positive action to opt in.

The pioneer action: the consumer class action

The adoption of the Consumer law of March 17, 2014 – the so-called "Hamon law" – marked the introduction of the first class action mechanism under French law ("action de groupe" in French). This law came into force on October 1st, 2014, and allowed consumer associations authorised at national level to act before civil courts to seek compensation for the individual losses sustained by a group of consumers. Consumers are defined in the French Consumers Code as any natural person acting outside his or her trade, business, craft or profession.

The loss sustained by the consumers must result from the breach of a professional's legal or contractual obligations, whether in the context of the sale of goods or the provision of services. This type of class action can also be used to seek compensation for the loss sustained by consumers as a consequence of anti-competitive practices (such as overcharging resulting from a cartel or abuse of dominant position).

It can only be used to seek compensation for material losses, which excludes losses resulting from physical or psychological damage.

The adoption of this first law was a very significant change in France. Since the entry into force, seven consumer class actions have been initiated. None has led to a judgment on the merits yet.

The new born: the health-related class action

On December 17, 2015, the law on modernisation of the French health system (the "Public Health Law") was definitely adopted by the French Parliament. Article 184 of this law provides for the introduction of a health-related class action mechanism which came into force on July 1st, 2016.

The health-related class action may be initiated by authorised associations (at local and national levels this time) which represent "users of the health system". A class action may be brought on behalf of such "users" who are placed in "an identical or similar situation".

This class action covers any of the products listed in Article L. 5311-1 II of the French Public Health Code, in particular pharmaceuticals, medical devices and cosmetic products. It may be lodged against manufacturers, suppliers and service providers which use the product (hospitals, healthcare professionals, etc.) for an alleged breach of their legal or contractual obligations. It aims at seeking compensation for any damage resulting from bodily injuries.

If the parties agree and the Court orders it, an optional mediation phase can take place at the beginning of the proceedings.

Otherwise, the Court will hand down a judgment on the liability, which will notably:

  • specify the compensable bodily damage
  • order the adequate publicity measures
  • define the "group" and the criteria to join the group
  • determine the cut-off date to join the group between 6 months and 5 years from completion of the publicity measures.

Appeals are available.

Once the judgment is final, it is up to the defendant found liable to examine the compensation claims and make offers. If the defendant refuses to compensate or if the offer is deemed insufficient, the "users" may refer the matter to the Court.

As we are writing these lines, no health-related class action has been initiated. But it's a bit too soon to assess the attractiveness and efficiency of this action, although many predict that the length and complexity of the proceedings are a strong repellent.

The summer's groundswell: towards a class action general framework

The coming weeks may witness an even larger step with the probable enactment of the so-called bill on the modernisation of 21st century Justice which should be adopted by the Parliament by the Fall. This bill notably creates a general framework for class actions to simplify and harmonise future class actions.

As the bill currently stands, this general framework would apply to class actions relating to discrimination, to class actions in environmental matters and to class actions regarding data privacy (all these class actions are created by this bill). The health-related class action would also be governed by the general framework provided for in the bill (subject to minor exceptions), but the specific provisions of this existing class action, set out in the French Public Health Code, would be unchanged. Ironically, the very first French class action, the consumer class action, would not be included in this general framework.

One of the specificities of the general framework (not applicable to health-related class actions) is a mandatory prior notice before action. The bill also specifies that class actions relating to discrimination and to environmental matters would only apply to alleged harmful events or alleged breaches occurring after the coming into force of the law.

After having resisted for years, France is now leading the charge in Europe with the introduction of many brand new class actions. The French litigation landscape is changing tremendously with these new actions as well as other in-depth evolutions (such as the on-going project to amend civil liability rules).