Which? launches £480m collective action over mobile phone chips

Hoult: Sending a clear warning

Consumer group Which? has launched the latest representative action, arguing that around 29 million people have been overcharged for their smartphones.

It has secured funding from Augusta Ventures, as well as after-the-event insurance, in claiming that consumers could be owed a collective £483m in damages from tech giant Qualcomm.

Which? argued that Qualcomm breached competition law by taking advantage of its dominance in the patent-licensing and chipset markets, meaning it could charge manufacturers like Apple and Samsung inflated fees for technology licences.

It said Qualcomm refuses to license its patents to other competing chipset manufacturers and to supply chipsets to smartphone manufacturers, such as Apple and Samsung, unless those companies obtain a separate licence and pay substantial royalties to Qualcomm.

Together, these abuses “enabled Qualcomm to charge Apple and Samsung higher fees for the licences for its patents, than would be the case if Qualcomm behaved lawfully”.

Which? said these were passed on to consumers in the form of higher smartphone prices. Which? is seeking damages for all affected Apple and Samsung smartphones purchased since 1st October 2015.

It estimated that individual consumers could be due up to £30 depending on the number and type of smartphones purchased during that period, although it is expected at this stage that most consumers would receive around £17.

Which? said Qualcomm has already been found liable by regulators and courts around the world for similar anticompetitive behaviour and urged the company to settle without the need for litigation by offering consumers their money back.

Anabel Hoult, chief executive of Which?, said: “We are sending a clear warning that if companies like Qualcomm indulge in manipulative practices which harm consumers, Which? is prepared to take action.

“If Qualcomm has abused its market power it must be held to account. Without Which? bringing this claim on behalf of millions of affected UK consumers, it would simply not be realistic for people to seek damages from the company on an individual basis – that’s why it’s so important that consumers can come together and claim the redress they are entitled to.”

Meanwhile, journalist and writer Peter Jukes has been named as the group representative for a claim against Facebook in respect of a loss of control over his personal data and the personal data of around one million other affected Facebook users in England and Wales.

The law firm bringing the action is Hausfeld, with funding from Balance Legal Capital.

Mr Jukes alleges that, between November 2013 and May 2015. Facebook allowed a third-party app called This is Your Digital Life to access not only the personal information of users who downloaded the app, but also the personal information of their Facebook friends.

This was done without their knowledge or consent and opened that information up to abuse by third parties such as Cambridge Analytica.

According to the Information Commissioner’s Office, the app was used by around 300,000 Facebook users worldwide and it has been estimated that the app collected personal data from up to 87 million users globally. Facebook itself estimates that at least one million UK users were affected.

In 2018, the commissioner issued the maximum penalty of £500,000 to Facebook for serious breaches of data protection law.

Hausfeld partner Michael Bywell said: “The law is clear that Facebook had a duty to safeguard users’ personal information – a duty that it neglected.

“With an experienced team, committed class representative and funding and after-the-event insurance in place, we believe this claim offers the best avenue of redress for consumers who suffered at the hands of Facebook’s failure to abide by data protection laws.”

We reported recently that December’s Supreme Court’s ruling in the Mastercard collective action case should reinvigorate the regime.

Five years on from the Consumer Rights Act 2015 that introduced the possibility of opt-out class actions, no cases have been certified. Seven applications for collective proceedings orders had been adjourned or stayed pending the Supreme Court ruling.

Onto group actions and specialist firm PGMBM has begun a case against Vauxhall over diesel emissions that it said could affect over half a million vehicles bought, financed or leased in England and Wales between 2009 and 2019.

The firm estimates that vehicles will have usually had at least two owners, meaning that over a million drivers could be affected.

It is alleged that, through the alleged use of so-called ‘defeat devices’, Vauxhall misled both customers and authorities as to the level of toxic emissions produced by certain models of their diesel vehicles.

Potentially affected vehicles include the Vauxhall Astra, Cascada, Corsa, Insignia, Mokka, Movano and Zafira. Drivers who bought, financed or leased these vehicles could be entitled to compensation of up to £20,000 each, PGMBM said. Vauxhall is therefore facing a potential liability of £10bn.

Managing partner Tom Goodhead said: “We believe that there are grounds to suspect Vauxhall have orchestrated a mass deception of the public, mis-selling vehicles that not only fail to meet the specifications, but risk damage to the environment and our collective health.

“Some vehicles are producing up to 10 times the amount of pollutants permitted.”

PGMBM intends to apply for a group litigation order and has promised would-be clients that it would take no more than 50% of their damages, and possibly only 20%, under a conditional fee agreement.

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