One year after France introduced class actions for French consumer and competition law cases (under Articles L.423-1 to L.423-26 and R. 423-1 to R.423-25 of the Consumer Code), the regime may soon also cover the healthcare sector.

After years of discussions and many unsuccessful attempts, recent public health scandals have bolstered a push for class actions in health-related cases.  The aim is to better compensate claimants and to deter wrongdoers.  On 17 December 2015 the National Assembly adopted the draft health reform law (Projet de loi de modernisation de notre système de santé), introducing new Articles L.1143-1 et seq. into the Code of Public Health regulating health-related class actions.  The rules are expected to take effect in … 2016.

A new tool for seeking compensation on behalf of patients …

The new rules provide for class actions on behalf of patients and other users of healthcare services and products.  The actions must be brought by accredited associations of users of the healthcare system and cover personal injury claims of individuals who are in identical or at least  similar situations.  Damage must be the consequence of a breach of statutory or contractual obligations by a producer, suppliers or any entities using healthcare products listed under Art. L. 5311-1 II of the Code of Public Health.  The definition of healthcare products is broad and covers, for instance, medicinal products, medical devices (including IVDs), biomaterials or cosmetic products.

The Courts of First Instance (tribunaux de grande instance) have exclusive jurisdiction for consumer and competition class actions.  The place of establishment of the defendant determines what court has territorial jurisdiction and the Paris court has jurisdiction over claims against foreign defendants.  Claims against a public entity, however, must be brought before the administrative courts (and another draft legislation proposes the creation of a general framework for class actions before administrative courts).

The litigation will follow a two-step approach.  The court first determines the principle of liability through the analysis of specific individual cases, determines the class of plaintiffs by defining the membership criteria and the personal injury covered, and sets cut-off dates to join the group (between 6 months and 5 years). The second stage is the compensation and award distribution phase and plaintiffs belonging to the group are compensated on an individual basis (Art. L.1143-11). This approach is intended to screen out frivolous claims in the early stages of the proceeding before the ‘massification’ of the dispute.

When opening the case for class action, the court also arranges for publicity in the media.  This is important because participation is based on an opt-in (as opposed to an opt-out system) and claimants have to apply to be included in the group.  This public announcement – and the likely impact on the company’s reputation – only occurs, however, when the court decision is final and cannot be appealed any more.

During the award distribution phase, compensation will either be awarded directly to the individual plaintiffs or to the association that represents them, depending on the plaintiff’s preference.  Where needed, the court can take a decision on the final distribution of the award.

The new provisions also provide for an alternative dispute resolution of health-related mass disputes (Art. L. 1143-6).  If the parties agree, the court may request the intervention of a mediator for a period of three months, renewable once. The terms of the possible settlement agreement reached must specify the type of personal injuries covered, the proposed compensation amounts, the cut-off dates to accept the offer and the methods of publicity to inform plaintiffs.  The agreement is subject to confirmation by the court.

…that is already subject to criticisms

Even before the formal adoption of the new rules, health-related class actions have been subject to heavy criticism.  For example, it is unclear how courts will handle the heterogeneity in claimants’ personal injuries.  The U.S. experience with class actions shows that the issue of claimant heterogeneity is real and far from recent.  Already in 1966, the Advisory Committee Note on the Amendment of Rule 23 of the U.S. Federal Rules of Civil Procedure pointed out that ‘a mass accident resulting in injuries to numerous persons is ordinarily not appropriate for a class action because of the likelihood that significant question, not only of damages but of liability and defences of liability, would be present, affecting the individual in different ways, as a class action would degenerate in practice in multiple lawsuits separately tried.’  It will be important to see how the French courts will address these cases, which are different from standard litigation. How courts will define class criteria or, for instance, regulate publicity may in practice greatly influence the impact of the new class action system.  Finally, since claimants will theoretically have up to five years to join the group, health-related class actions may result in lengthy and costly proceedings for all parties involved.

Five class actions have been filed since 1 October 2014 under the consumer protection rules. So far, they have dealt with improper rent charges or unfair contractual terms.  One of them resulted in a 2 million € settlement, compensating 100,000 individuals.