The Bundling of Similar Interests in Litigation. The Incentives for Class Action and Legal Actions taken by Associations

The European directive 98/27/EC of 15 of May 1998 widens the scope of action for consumer interests. The new directive follows the green book on the rights of the consumer of 11 June 1993. The necessity to transform this directive into national law has led to discussions on whether it is advisable to generally expand the scope of liability for widespread damages. Should the possibilities to collect damages for consumer associations and to establish new forms of bundling similar interests in cases of civil liability be widened? This article deals with economic consequences of such forms of bundling with a focus on the class action and actions by associations. The American discussion on the merits of class action is not very encouraging and does not lead to proposing far reaching legal innovations for European countries in this field. It seems however that some of the adverse effects of class action can be avoided by slightly different forms of bundling.