US class action law firm Hausfeld has struck a deal with top litigation funder Burford Capital to support the claim it is bringing in England against truck manufacturers found guilty of illegal price fixing, the second major announcement of funded litigation over the cartel in a month.
Last July, the European Commission fined MAN, Volvo Group (which includes Volvo Trucks and Renault Truck), Mercedes-Benz parent company Daimler, Iveco and DAF nearly €3bn (£2.6bn) for price fixing and other cartel activities between 1997 and 2011.
Any business across the European Economic Area which purchased or leased medium-duty or heavy-duty trucks from these companies now has a right to claim compensation for any loss suffered as a result of the higher prices which they had to pay for trucks due to the price fixing, together with interest since the date of purchase.
Hausfeld said it has “a number of significant existing clients and we are continuing to attract more”, with the claim value set to be in the hundreds of millions of pounds.
It is offering to work on a traditional fee-paid basis or an “alternate fee structure using third party litigation funders and insurance”.
Last month, we reported that litigation funder Therium Capital Management is backing an opt-in collection action being brought by the Road Haulage Association, which said it has also secured “the largest tranche of after-the-event insurance that’s ever been underwritten”, although it has not revealed the size or provider.
The association said “early indications” were that compensation could be in the region of £6,000 per truck and that 650,000 new trucks were sold during the 14-year period – this would be £3.9bn in total.
Therium will be paid either three times (or less, if the case settles early) of what it has cost to bring the claim, or a percentage of the money that the group wins, if that is more than the first option plus the return to the funder of the funder’s outlay.
Potential claimants have been told: “The percentage starts at 30% and reduces to 5% at higher overall compensation levels. There is also a third reduction in the funder’s fee if the case settles early.
“Based on conservative estimates of the level of damages and the number of trucks that will form part of the RHA’s claim, you should receive between 91% and 95% of any award or settlement. If the case settles early, you would receive an even higher portion of your award or settlement. To some extent, the RHA’s ability to deliver returns at this level will depend on the ultimate size of the claimant group.”
Specialist transport law firm Backhouse Jones is running the case, along with Exchange Chambers and Brick Court Chambers.