The government has approved the class action lawsuits. But it does not make it easier to enforce rights

JUDr. Ondřej Preuss, Ph.D.
14. September 2023
5 minutes of reading
5 minutes of reading
Other legal issues

Clients of bankrupt energy suppliers, consumers who have fallen for misleading advertising, customers who have bought a dangerous product. They could all seek to enforce their rights through legal action. So far, however, it seems more theoretical. The Collective Redress Act, which has been endorsed by the government, places traps for consumers in pursuing their claims.

nespokojení klienti, hromadná žaloba

Benefits of class actions

Class actions allow people to join forces in a single lawsuit. For example, when they have suffered similar damages because of the same wrongful act. By linking and uniting under one entity to help them recover their rights, they achieve many benefits:

  • Economic savings – the costs of litigation are shared among all plaintiffs, which can be much more efficient and cost-effective than individual lawsuits. For example, people who would not have the resources to litigate on their own can have access to justice.
  • More pressure on responsible parties: class actions can be used to put more pressure on companies, organisations or individuals who are responsible for damages. If a company sees tens or hundreds of customers standing against it, it can force it to negotiate and resolve the dispute more quickly. The problem can then be resolved more quickly, or the practices that led to the damage can be changed.
  • More equal parties: would you dare to take on an energy supplier, a large car company or a factory that pollutes the neighbourhood and whose bosses have close ties to the municipal leadership? Imagining their top lawyers and your financial capabilities, quite possibly not. But even this disparity and imbalance of power can be overcome through class action lawsuits. When multiple people join together in one lawsuit, they are in a stronger bargaining position and can better defend their rights.
Are you solving a similar problem?

Want to sue and not sure if you'll win?

We will assess your chances of success in court and propose a solution that will lead to the desired outcome. You will only succeed in court if your claim is bulletproof. We will conduct a careful analysis of your case and take care of preparing a pre-suit notice, a statement of claim, an appeal or straight to representing you in court where we will vigorously enforce your rights.

I want to help

  • When you order, you know what you will get and how much it will cost.
  • We handle everything online or in person at one of our 5 offices.
  • We handle 8 out of 10 requests within 2 working days.
  • We have specialists for every field of law.

Around the world, class actions are typically used in cases of consumer disputes, environmental pollution, workplace discrimination or patent infringement. That is, in situations where there may be widespread damage or violation of the rights of a large group of people.

The regulation of class actions in Czech law

The introduction of class actions is mandated by the European Directive of 2020, which aims to increase consumer protection in the European Union. The Directive set out a framework within which Member States had until the end of June 2023 to adopt follow-up legislation. However, the government was rather slow to adopt the law and missed the deadline. Last year, the Ministry of Justice came up with a proposal. However, it has subsequently undergone significant changes that have transformed it for the worse in terms of consumer protection. So what does the proposed legislation consist of?

Tip na článek

Tip: A pre-suit notice is usually sent as a last attempt to resolve the dispute amicably before a lawsuit is filed. When exactly is this notice sent and what is its purpose? What should it contain? This is the subject of our separate article.

How can consumers not improve access to their rights?

The primary peculiarity of the law is that only consumer organisations can bring class actions. And even then, only those that have been in business for at least five years. However, there are very few such organisations operating in the Czech environment and it cannot be assumed that they will have the capacity to defend all the victims. Moreover, although there are often high-quality and erudite theoretical lawyers, they are not (and cannot be) very proficient in procedural law, i.e. in knowledge of court proceedings. Elsewhere in the world, it is common for consumers to be able to choose their own entity to represent them, typically a law firm.

The second limitation is the way in which people will be able to join a class action. In fact, injured clients will have to actively opt in themselves. So that means watching the news on the issue, noticing that a class action is coming and signing up for it. In addition, the current form of the law reduces the time that injured clients have to join a lawsuit to four months.

Thus, a much greater effort will have to be made on the part of the consumer organisation to publicise and explain the case. An alternative under consideration would be for all affected clients to be automatically included in the lawsuit and to opt out if they are not interested in litigation.

The strategy regarding the choice of the court that will rule on class actions is also surprising. This is because there will be only one Czech court, the Municipal Court in Prague. It is entirely appropriate that a single court should decide on a collective action. That is, after all, its essence. The question is whether it should be the aforementioned Municipal Court in Prague. It is already the exclusive court for the enforcement of industrial property rights. The question arises whether the capacity of that court will be sufficient for another large agenda.

Tip na článek

Tip: Civil litigation is a complex process, hundreds of books have been written about its process or its sub-aspects. But what of it is relevant to the ordinary mortal going to court? How does the court process work under the rules and what to expect if we are heading to a court hearing? That’s what we focus on in our article.

The plaintiff’s fee (i.e. the consumer organisation that takes on the action) is capped at 5% of the amount awarded. Even this is a low and rather unusual amount compared to abroad. Again, it should be reiterated that the other side is likely to be a multinational company with a strong professional and economic background, which will require very careful preparation on the part of the claimant.

Sdílejte článek


Are you solving a similar problem?

Solutions Tailored for You

Our team of experienced attorneys will help you solve any legal issue. Within 24 hours we’ll evaluate your situation and suggest a step-by-step solution, including all costs. The price for this proposal is only CZK 690, and this is refunded to you when you order service from us.

I Need help

Author of the article

JUDr. Ondřej Preuss, Ph.D.

Ondřej is the attorney who came up with the idea of providing legal services online. He's been earning his living through legal services for more than 10 years. He especially likes to help clients who may have given up hope in solving their legal issues at work, for example with real estate transfers or copyright licenses.

Education
  • Law, Ph.D, Pf UK in Prague
  • Law, L’université Nancy-II, Nancy
  • Law, Master’s degree (Mgr.), Pf UK in Prague
  • International Territorial Studies (Bc.), FSV UK in Prague

You could also be interested in

We can also solve your legal problem

In person and online. Just choose the appropriate service or opt for an independent consultation when you are unsure.

Google reviews
4.9
Facebook reviews
5.0
5 200+ people follow our Facebook
140+ people follow our X account (Twitter)
140+ people follow our LinkedIn
 
We can discuss your problem online and in person

You can find us in 4 regional towns

Quick contacts

+420 775 420 436
(Mo–Fri: 8–18)
We regularly comment on events and news for the media