BT Group Plc & Anor. v Justin le Patourel

When the Competition Appeal Tribunal chooses between opt-in and opt-out collective proceedings, neither form has a legal or policy preference. The Tribunal must make an open-textured, multifactorial assessment of all the circumstances under Rule 79(3) of the Competition Appeal Tribunal Rules 2015.

Practicability extends beyond whether class members can be identified and contacted. It includes whether converting them into litigants would be reasonable, proportionate, efficient and financially viable. The likely participation rate and availability of third-party funding are relevant.

After awarding aggregate damages, the Tribunal may use its broad case-management powers to permit distribution through account credits. The merits need not add weight to the opt-in or opt-out decision merely because the claim has survived summary determination.

The Competition Appeal Tribunal certified a collective claim against BT concerning allegedly excessive prices charged to voice-only and split-purchase telephone customers. It ordered opt-out proceedings and, should the claim succeed, aggregate damages. Its substantive decision was reported at [2021] CAT 30.

BT did not appeal against certification, the rejection of its strike-out and summary judgment applications, or the provision for aggregate damages. It challenged only the opt-out direction. The appeal concerned the criteria governing the opt-in or opt-out choice, the Tribunal's power to distribute damages through account credits, and the role of the claim's merits in that choice.

1. Appeal dismissed. Section 47B of the Competition Act 1998 and Rule 79(3) of the Competition Appeal Tribunal Rules 2015 create no presumption or policy preference for either opt-in or opt-out proceedings. The legislative starting point is neutral. The CAT Guide could not lawfully restrict the open-textured statutory discretion by creating a preference for opt-in proceedings.

2. The choice is a multifactorial assessment entrusted to the specialist Tribunal. Practicability is only one potentially relevant consideration. It encompasses more than whether class members are identifiable and contactable. The Tribunal may consider whether converting those persons into litigants would be reasonable, proportionate, expedient, cost-effective and efficient. Here the large class, modest individual awards, likely low opt-in participation and resulting effect on funding compellingly favoured opt-out proceedings.

3. The availability of third-party funding is relevant to access to justice and equality of arms. The Tribunal must form its own assessment and remain alert to oppressive use of opt-out leverage and disproportionate costs. It was entitled to conclude that limited participation would make opt-in proceedings unattractive to funders and could prevent the claim proceeding.

4. The Tribunal may, after awarding aggregate damages and directing their initial payment to the representative or an authorised third person, use its broad case-management powers to permit distribution through account credits. “Distribution” is not statutorily confined to individual payments of fungible sums. An account credit may maximise compensation while reducing administrative cost. The Tribunal may employ different methods for current customers, former customers and others, and may require the parties to cooperate.

5. The strength of the claim is a permissible consideration, but the Rules impose no special merits hurdle for opt-out proceedings. A claim which survives summary determination need not receive additional weight in the opt-in or opt-out balance. The Tribunal's reference to a “very weak” claim in paragraph 124 of its judgment was set aside as irrelevant, without affecting its decision.

1. Court of Appeal (Civil Division): By [2022] EWCA Civ 593, dismissed BT's appeal and upheld the direction that the collective proceedings should operate on an opt-out basis.
2. Competition Appeal Tribunal: By [2021] CAT 30, certified the claim, rejected BT's strike-out and reverse summary judgment applications, provided for aggregate damages if the claim succeeded, and directed opt-out proceedings. It subsequently refused permission to appeal in [2021] CAT 32.