On 25 July 2023, Christine Riefa Class Representative Limited (the Proposed Class Representative or PCR) applied to commence opt-out collective proceedings against Apple and Amazon on behalf of all those who had purchased Apple electronic products at retail level in the United Kingdom during the period of the claim.

The PCR asserts that Amazon and Apple have negotiated agreements that distort competition within the United Kingdom. Specifically, the PCR highlights agreements made between Apple and Amazon in October 2018. According to the PCR, these agreements have resulted in a notable decrease in the number of resellers of Apple products operating on the Amazon UK Marketplace and an increase in the prices of those products.

Dr. Pike, the PCR’s expert, estimates that the affected class comprises over 36 million people. His assessment of the total losses incurred by this class amounts to 494 million pounds, excluding interest.

The PCR is a private company limited by guarantee established specifically for this legal action. Its sole member and director is Professor Christine Riefa, who holds a professorship at the University of Reading and instructs courses in EU Law, Commercial Law, Technology, Privacy, and Internet Regulation.

In a hearing conducted in July 2024, the Tribunal expressed concerns regarding the confidentiality of the funding terms, the specifics of the agreed-upon funding terms, and the suitability of the proposed class representative.

To assess the PCR’s capacity to act fairly and adequately in the interests of potential class members, the Tribunal must evaluate all pertinent circumstances, including how the PCR has ensured that the funding arrangements effectively serve and safeguard those interests.

One issue the Competition Appeal Tribunal highlighted was that Hausfeld had entered into heads of terms for funding this claim with Asertis before Professor Riefa accepted the PCR role. The CAT’s overall assessment indicated Ms. Riefa depended heavily on her legal advisors.

The Tribunal was not persuaded that she fully comprehended the agreements made by the PCR on behalf of the class (in reality, by Hausfeld, Asertis, and Exton, the broker, on behalf of the PCR), raising concerns about her capacity to protect the class’s interests.

During her cross-examination, the Tribunal observed that Professor Riefa appeared hesitant and uncertain in her responses. Overall, it was clear that she did not fully grasp the agreements she had entered into.

When questioned by Apple’s King’s Counsel regarding the conditions under which she would deem it appropriate for the class representative to seek priority payment from the funder over the class members, she indicated that such a request would be suitable if the PCR were less successful than anticipated or entirely unsuccessful. She did not seem to understand that if the claim were unsuccessful, the clause would not be applicable at all.

The CAT also raised concerns about the confidential nature of the Litigation Funding Agreement. All versions of the LFA include confidentiality obligations mandating the PCR to maintain the confidentiality of certain information, including “all information relating to (i) the provision of the Claim Funding to the Claimant by the Funder and (ii) the Funder’s identity.”

In particular, the Tribunal wanted to understand why the LFA prevented the class from receiving basic information regarding the funder’s level of return and the obligations assumed by the PCR under the LFA.

In response to questions from the Tribunal Chair, the PCR’s KC replied: “Having taken instructions, I am told that this is a point the funder feels quite strongly about …”. When asked for the position of the PCR, he replied: “I have not taken instructions on that, but she is bound by an agreement with the funder”; and “I am sure that she instinctively would not want to take a position contrary to that of her funder”.

The Tribunal seemed baffled by this: “She is clearly alive to the interests of the funder. She does not, however, appear to have considered sufficiently where the interests of the class members lie.”

To satisfy the authorisation requirement, the PCR must articulate the interests of the class and engage with any legal advice received robustly and independently, the CAT held. This necessitates, at a minimum, a comprehensive understanding of (a) the implications of the proposed terms and (b) the broader context of the advice, which includes the stance of its legal advisers and the potential for conflicts of interest that may arise from that stance.

Therefore: “Our conclusion is that we do not consider that the PCR has satisfied the authorisation condition. On that basis, we are not able to make a collective proceedings order in this case. Our key concern in this case is that Professor Riefa has not demonstrated sufficient independence or robustness so as to act fairly and adequately in the interests of the class.”

Kelyn Bacon, Chair
Anthony Neuberger
Charles Bankes

14 January 2025