Litigation costs uncertainty impedes access to justice, legal experts warn

Litigation costs uncertainty impedes access to justice, legal experts warn
Uncertainty shrouds litigation costs, which is putting obstacles in the way of access to justice, a panel of experts warned at The Lawyer’s antitrust litigation conference ;last ;week (7 May).

The panel’s note of caution came in relation to the European Commission’s white paper on compensating victims of competition breaches.

Panel members broadly welcomed ;the ;paper’s recommendations, but said it failed to go far enough on the issue of costs.

US firms such as Constantine Cannon flew in to share their experiences with the cream of the UK litigation fraternity and a number of senior in-house lawyers.

Constantine antitrust litigation partner Gordon Schnell summed up the panel’s tone, saying: “There’s really nothing concrete coming out of this white paper, despite the acknowledgement that something needs to be done. “Costs and the inability to bring class actions in Europe are the two biggest issues in the paper, and the level of costs plays a huge role in bringing actions.”

The white paper, published last month, set out a series of recommendations aimed at achieving compensation for cartel victims.

These included plans for single rather than multiple damages, proposals for a representative action framework and giving the presiding judge access to all “relevant evidence”. Carel Maske, Microsoft director of competition law for Europe, the Middle East and Africa, said the report had rightly highlighted the problem of “excessive costs”. However, he added: “It looks to me, as the person who’s looking at the [legal] invoices, that there’s an ignorance around costs development in litigation.”

Maske said using court orders to cap costs would fail to solve the issue of spiralling legal bills, as some firms were justified in their charges.

“There seems to be a little bit of an ivory tower about real-life costs and what they should be,” he said. “Legal costs include the cost of the court and internal costs too.”

The panel put forward the argument that firms needed ;to ;use ;skilled expertise more efficiently to determine costings in order to give clients clarity. Susan Dunn, chief executive of Harbour Litigation Funding, said: “Most clients want greater clarity around the case and its costs and how long it will take.”

Norton Rose litigation partner Sam Eastwood said Dunn’s suggestion could only be followed to a certain extent. “Litigation is an inherently uncertain process and we have to evaluate those uncertainties,” he added.

Eastwood said he felt third-party funders would drive a radical overhaul of how the profession responds to its funding and costings issues, ;so ;indirectly providing greater clarity.

“Funders will participate in the reform of the legal profession by bringing about ;costs-capping, structural reform and a secure progressive funding model,” he said. “Funders will drive best practice and professionalism – they’ll be professional litigators. Costs caps from defendant lawyers will be offered and they could influence choice of counsel. Litigation is an investment.”

Schnell said competition cases should be treated differently from traditional litigation, adding that the Commission should consider allowing the use of contingent commissions to enable greater access to justice.

As European member states look to the Commission to deliver a framework capable of bringing compensation to victims of antitrust violations, it is clear that what is being demanded is better access to funding and more certainty around the claims process.