The Globalization of Class Actions: An Overview

• Published date: 01 March 2009
• Date: 01 March 2009
• DOI: http://doi.org/10.1177/0002716208328327
• Subject Matter: Articles

ANNALS, AAPSS, 622, March 2009 7

In less than a decade, the number of countries that per-

mit representative litigation by private actors has mul-

tiplied dramatically. A minority of these procedures

share all the features of the American class action for

money damages. But there is a trend toward permitting

private individuals and organizations to come forward

on behalf of absent parties to obtain injunctive or

declaratory relief or monetary compensation in some or

all circumstances. Whether these procedures will

spread to other countries or within countries to a wide

variety of substantive legal matters and whether in par-

ticular private actors will be allowed to claim money

damages in many or all instances is uncertain.

Currently, the key obstacles to effective implementa-

tion of class action procedures are traditional legal

funding rules that do not easily accommodate the real-

ities of representative litigation.

Keywords: class actions; group litigation; mass torts;

international civil procedure; transna-

tional litigation

The importance of access to justice, as a funda-

mental human right which ought to be readily

available to all, is clearly a new consideration that

stimulates fresh thinking about representative or

“grouped” proceedings.1

1. Introduction

Around the world, individuals, nongovern-

mental organizations (NGOs), and public offi-

cials are turning to courts for remedies for

mass harms: mass injuries caused by defective

products or environmental exposure to toxic

chemicals, mass financial losses resulting from

violations of antitrust (anticompetition) law,

The

Globalization of

Class Actions:

An Overview

By

DEBORAH R. HENSLER

Deborah R. Hensler is Judge John W. Ford Professor of

Dispute Resolution at Stanford Law School.

NOTE: I am grateful to my colleague Christopher

Hodges and to members of the Bay Area Civil

Procedure Forum and particularly Professor Richard

Marcus for comments and suggestions. I gratefully

acknowledge the assistance of Radek Goral.

DOI: 10.1177/0002716208328327

securities law, consumer protection statutes, and historical and contemporane-

ous civil rights and human rights abuses. While some of this litigation is

brought by public officials on behalf of citizens of their jurisdictions, an

increasing fraction of the litigation is initiated by private parties. In some

instances, the litigation comprises large numbers of similarly situated individu-

als or entities whose individual lawsuits have been combined: so-called aggre-

gate litigation. In other instances, the harms are perceived as having been

visited on a group of people with shared interests, not all of whom are individ-

ually identifiable at the onset of litigation—consumers, workers, women, vic-

tims of genocide, or indigenous peoples—and the lawsuit is commenced by a

party who claims to represent this group: what is commonly called a class

action. In the first instance, all of the parties are formally before the court and

formally in control of their own lawsuits, although individual claimants may in

fact have little control over what transpires in the litigation. In the second

instance, all or most of the class members are absent from court and control

over the litigation is formally assigned to the class representative(s) and class

counsel. Both aggregate and class litigation reflect an escalating trend in private

civil litigation: what were once viewed as singular disputes between individuals

or between an individual and a corporation, not all of which deserved legal

redress, are now viewed increasingly as group struggles against multinational

corporations and other global institutions, properly resolvable in court.

In many respects, the United States has led the way in these developments:

the 1970s “rights revolution” in the United States created the statutory frame-

work for asserting civil rights, demanding protection from environmental

harms, and claiming compensation for losses resulting from anticonsumer busi-

ness practices;2and the adoption of a revised federal class action rule in 1966

(rapidly duplicated by state courts) made it easier for individuals to come for-

ward to claim remedies, including money damages, on behalf of large groups of

similarly situated individuals.3Public interest lawyers used the procedure to

obtain injunctive relief from governments: elimination of racial and other dis-

criminatory practices and education, prison, and welfare reform, among other

goals. Private sector lawyers used the procedure to obtain monetary compen-

sation for victims of consumer fraud, violations of security regulations, product-

related injuries, and environmental damage. The rise of an entrepreneurial

plaintiff’s bar (in part a response to the new procedural rule) provided the

engine to power class actions for money damages, and a media-centric mass

culture created an environment in which such litigation could flourish.4

While on the surface the adoption of a class action procedure may appear to

be a technical matter of interest only to lawyers, the social, economic, and polit-

ical consequences of permitting class actions are potentially vast. Because the

type of class action procedure adopted by the U.S. federal judiciary in 1966 and

elaborated on since empowers individuals with relatively modest claims that

would be impractical to litigate individually to join forces and seek redress, its

availability within a legal regime dramatically shifts the balance of power between legal

“haves” and “have-nots.”5Because this type of class action procedure permits one

8THE ANNALS OF THE AMERICAN ACADEMY