The first step in any group action is identifying a suitable claim. There is generally no limit on the subject matter of the claim, provided that a number of people have been affected in similar ways. Thus, past multi-party claims have included:
- Securities actions brought pursuant to the Financial Services and Markets Act 2000;
- Medical negligence claims arising out of the PIP breast implant scandal;
- Claims for the misuse of personal data;
- Environmental damage claims following an oil spill;
- Claims under business-interruption insurance policies following the Covid-19 pandemic; and
- Standalone or follow-on competition damages claims.
Multi-party litigation often, although not always, arises in circumstances where a party has been adversely affected by someone else's conduct, but where their loss is not large enough to make an individual claim economically viable. Group actions enable the costs of litigation to be spread between claimants (often with the benefit of specialist funding arrangements), enabling such actions to be brought. However, to take the benefit of these economies of scale, a sufficient number of claimants must be identified before proceedings are issued. This "bookbuilding" process can be challenging and time-consuming, and may necessitate the assistance of claims management companies who take an active role in seeking out prospective claimants.
It is vital at this stage to assess the merits of each individual case. Weaker claims can have a detrimental effect on the case as a whole and should be weeded out at the outset. Caution must also be exercised in relation to limitation issues and in ensuring that each claimant has given the requisite authority to act on their behalf.