Mariana Soares David in the panel discussion on ‘Product Liability Claims’ at the Global Class Actions Symposium 2024

Mariana Soares David, a partner in Morais Leitão's litigation and arbitration team, took part as a speaker at the Global Class Actions Symposium 2024, which took place on 12 and 13 November at the SUD Lisboa Hall in Lisbon. The event, organised by the Global Legal Group (GLG), brought together international experts to discuss the latest trends and challenges in the field of class actions.

The lawyer was part of the panel discussion ‘Product Liability Claims’, which discussed some fundamental questions about producer liability in the context of class actions.

During the discussion, topics such as:

• The differences between the legal regimes of the European Union, Canada and the United States in product liability;
• The impact of the new European directives, including the Product Liability Directive, on transnational litigation;
• The role of consumer associations and financing funds in boosting these actions;
• The challenges of collecting and preserving technical evidence for the defence of companies involved in product liability litigation.

Read the full discussion below.

Debate "Product Liability Claims"

Speakers: Mariana Soares David; Hal Singer, Managing Director, Econ One; Matthew Angelus, Partner, Torys LLP

MILES ROBINSON:
So, thank you, Andrew, and thank you to GLG for organizing such a fantastic event in a superb location. Also, thank you to Portugal and our Portuguese hosts for providing some sunshine—those of us from the UK haven’t seen it for about a month, so it’s great to have it with us.

In this session, we’re going to be looking at where product liability claims fit in the class actions landscape. As lawyers like to do, I’ll start with a definition. So, for the purposes of this panel, what we’re talking about with product liability is a broad scope. We’re looking at issues faced by consumers from a product, including the more obvious safety-related issues, such as those from pharmaceutical products or medical devices, as well as misrepresentations about performance or quality, such as vehicle emissions claims.

So, we’ll start with some introductions. If I can start at the far end—Matthew?

MATTHEW ANGELUS:
I’m a partner at Torys LLP in Montreal. Torys LLP is a full-service Canadian law firm with offices across Canada and in New York in the US. My own practice is focused on product liability and consumer protection class action defense. I also do quite a bit of compliance work, helping companies, particularly those outside Quebec, comply with our unique product standards regime and consumer protection regime, with a focus on class action avoidance.

HAL SINGER:
I’m an economist and Managing Director at Econ One, an economic consulting firm. I’m also a professor of Economics at the University of Utah. My practice spans a few different areas—antitrust and, increasingly, consumer protection. Recently, my reports have been cited by courts to certify five classes in consumer protection matters, and I think we’ll talk about a few of those today.

MARIANA SOARES DAVID:
I’m a partner at the Portuguese law firm Morais Leitão and a member of the firm’s dispute resolution team. I’ve specialized in prevention, so I also do a bit of compliance and regulatory work, but mostly in the resolution of disputes around the product value chain—consumer protection, product liability, and distribution agreements. Throughout the years, I’ve assisted clients in class actions, product liability, civil and misdemeanor proceedings, and also in implementing recall and withdrawal measures.

MILES ROBINSON:
Thank you all. I’m Miles Robinson, a partner at Mayer Brown’s London office, specializing in complex commercial disputes. Since the late ’90s, I’ve been defending group actions, particularly in matters related to product safety and environmental damage.

So, let’s kick off with some scoping questions first, before we get to some more philosophical questions, which we hope will spark some debate—certainly amongst the panel, as I know from our pre-sessions, and hopefully from the audience as well.

Let’s talk briefly about the landscape for product-related actions in a couple of jurisdictions. What legal basis are they brought under? What remedies are sought, and how common are they? Maybe some examples as well. So, if I could start with you, Mariana?

MARIANA SOARES DAVID:
Well, as you explained, our definition of product liability here will be quite broad. Just yesterday, while speaking with Matthew, we realized that the concept of product liability differs significantly between the EU and Canada.

For clarity, and to give you an idea of these two realities—and, of course, I’m oversimplifying—we can discuss product-related actions available to consumers by looking at differences in the types of damages and remedies. On one hand, we have product liability stricto sensu, which relates to the manufacturer’s strict liability for placing unsafe products on the market.

An example would be a dishwasher that, due to an infringement of safety rules during manufacturing, causes a fire, leading to damage to household appliances and possibly physical harm to someone nearby. In that situation, at the EU level—since this area is now quite harmonized—the consumer would have the right to compensation for damages caused by the unsafe product to other products or individuals, but not for the damage to the defective product itself. This right would be available within a 10-year period after the product is placed on the market.

Then we have, again oversimplifying, all sorts of consumer protection claims, mostly relating to the delivery of a defective product—one that does not meet the expected qualities under the contract—or the infringement of other consumer rights, notably information rights. The available remedies vary depending on whether the claim is contractual or non-contractual, but they can generally be brought against either the seller or the manufacturer. The most common remedies include the right to repair, replacement, and compensation for damages.

With this in mind, and to give you an overview of the current landscape in Portugal, we have already seen in other panels that the country has been experiencing an increase in consumer class actions, including product-related ones. In fact, over the past year, we have seen a 240-ish percent increase in these cases. Most have been filed by consumer associations, with claims seeking either injunctive relief, compensatory relief, or both.

I’ve chosen to highlight the most typical grounds on which these claims are based:

• Private enforcement of anti-competitive practices;
• Non-conformity with consumer expectations, which may include issues related to labeling and advertising;
• Unlawful commercial practices, particularly the lack of sufficient information on products and pricing—so beware of Black Friday promotional prices;
• Lack of pre-contractual information;
• More recently—and this is quite unique to Portugal—the absence of an electronic complaints book made available to consumers, even by online platforms.

This last obligation is specific to Portuguese law, and it remains uncertain whether it applies to companies without a permanent establishment in Portugal.

And just as a final note, while the core of this discussion is product liability in a narrow sense, we have seen that, at least for now, individual claims or the joinder of individual claims have been the most common form of proceeding in these cases.

MILES ROBINSON:
We’ve heard a lot about Portugal, and we’ll hear a little more, but it’s really interesting that this has become such a hot spot for all types of claims.

Let’s jump across the Atlantic—Matthew, tell us about Canada.

MATTHEW ANGELUS:
Thanks. As I mentioned before, I'm from Quebec, which is not only Canada's only primarily French-language province, but it's also Canada's only civil law jurisdiction. It's also, as yesterday's keynote speaker alluded to, Canada's first jurisdiction which adopted a sort of modern class action legislation in the late 1970s, and it's Canada's most plaintiff-friendly jurisdiction.

Above the sort of narrow concept of product liability, being the fault or the damage caused by a product to another person or their property, Quebec takes a very broad focus on what is a product liability claim. These usually take two forms: either in the consumer sense, where one is arguing that a product failed to meet a standard of fitness for purpose, or in a more general failure-to-disclose scenario—whether it's in advertising, in product disclosures, in labeling, or otherwise.

But there's also a possibility of a claim outside of the consumer focus, in a more limited civil space, which is really a failure to maintain a minimum standard for the product, and that applies whether someone is a consumer or not. An example of that would be a recent class action alleging underpowered engines in trucks and the various damages that result—a claim that, yes, involved some individual truck owners, but mostly fleet owners who were members of the group.

In terms of the remedies that are sought, we see, again, in addition to the compensatory and even punitive damages for harm that is caused, the most common remedies sought are either an augmentation of the purchase or a termination of a service agreement relating to that purchase, but most importantly, the return of the purchase price or the reduction of the sales price.

These remedies can be sought either on an individual recovery basis through a class action or on a collective recovery basis. The individual recovery would inevitably involve individual members proving their own claims, and, as we've seen over the last few days, what is relatively unique is the ability to actually have collective recovery, where amounts are deposited directly into an account that already exists and for which the information is already available—without the consumer having to do, frankly, anything other than the notice requirements, which they may not otherwise be aware of. They simply receive a surprise payment in their account.

In terms of injunctive relief, it is possible, and the Quebec courts constantly remind parties that, yes, it is possible to seek an injunction through a class action. But, practically speaking, it's not a very useful remedy. The cases take so long to work their way through the courts that, for someone to seek an injunctive remedy—such as repairing a product—by the time the case is ultimately finalized, the remedy is often theoretical. The product is either no longer in the hands of the purchaser, has been sold, or has simply been replaced for a long time, and people are generally better served with damages.

MILES ROBINSON:
Mariana and Matthew, I think that's a really good scoping briefing. I think the next, or final, scoping question before we get into some more technical aspects and some philosophical aspects is just in terms of whether you're seeing a rise in these types of claims, and if so, why.

So, I'll start with you, Matthew.

MATTHEW ANGELUS:
In terms of a rise, I'd say that the number of claims has been relatively constant over the last five years or so. They really peaked around the time of the pandemic. We've seen the number of roughly 100 class actions in Quebec filed per year remain a relatively constant figure.

In the rest of Canada, you see generally two times that, but spread out across jurisdictions. There's more focus in BC [British Columbia], less in Ontario, but I'd say that the number has been relatively stable. We have a very mature class action market, so I wouldn't say that there's been an increase over the last five years.

MILES ROBINSON:
Do you want to talk a little bit about the legal minimum standards for goods and whether that's a particular factor?

MATTHEW ANGELUS:
Sure, and bear with me for one last technical jargon before we can actually get into a little bit of a discussion. But I think it's helpful to understand, as we look at the different regimes, it's easy to talk about what's similar, but I think it's a little bit more interesting to talk about what's different.

In addition to the procedural elements which I described earlier, Quebec does impose on the sale of goods a legal warranty of quality, which is a minimum standard for every good sold. It holds that it must be fit for its intended use and durable for a reasonable amount of time, and that is really based on the price that is paid. So, there are two elements to that—a deck of cards might only need to have a certain minimum standard of duration of a week, whereas for a furnace, it might be 30 years. There is case law regarding the duration of a furnace, but it also relates to the price paid. So, a BIC pen has to have a longer shelf life than a Mont Blanc.

I think that one other important element to mention, and something that sets Quebec apart, is a triple presumption of liability, which works against the professional seller. Once a purchaser has established that a good has failed, for whatever reason, prematurely when compared to other goods of the same nature and of the same price, a triple presumption is immediately invoked, which has three heads. The first is the existence of a defect. The second is that the defect predates the sale of the contract. And finally, a causal link between any damages suffered and the malfunction itself.

Now, while this is a rebuttable presumption, it has the effect of transferring the burden of proof from the claimant onto the defendant to prove that their good was, in fact, exempt from any defects. In the class action space, this is an incredibly strong tool for plaintiffs. What we're seeing more recently is that plaintiffs are not even filing expert reports on liability. Instead, they are relying on the triple presumption to say, "Hey, defendants, show us that your products are actually functional."

While this works in terms of presuming the existence of a defect, it does not prove damages. We've seen this in a number of cases, and I have one in mind against Mazda, alleging a failure of the lock mechanism on the car. The case was taken on behalf of two groups. The first group included those whose locks failed, and their cars were stolen. For them, damages were relatively easy to prove, based on the present market value of the vehicle.

However, there was a second group seeking damages despite not having had their cars stolen. Their claim was based on a perceived lack of resale value for those vehicles. They tried to introduce evidence of damages in various ways, including surveys where different members estimated that their cars were worth $1,000 or $3,000 less. Ultimately, the court found that, while the defect was proven based on the presumption, the damages were not, and after 14 years of litigation, the court awarded zero damages.

MILES ROBINSON:
Follow that, Mariana. Anything in Portugal that you want to add in terms of what's driving rising cases?

MARIANA SOARES DAVID:
Well, we haven’t had that many class actions, really—not in a narrow sense for product liability. It’s been more about individual or group claims, joinder of individual claims.

But while we have had a boom in class actions—particularly consumer class actions related to products—mostly with the types of causes of action I mentioned earlier, we could discuss the reasons for that. I would say that, in all jurisdictions, individuals are becoming more and more informed, but this is not particular to Portugal.

We could say that we have a very claimant-friendly system, but we have had this system since 1995. So, I would say that the main drivers are actually the increasingly sophisticated consumer associations, backed by funders and also very specialized law firms.

MILES ROBINSON:
Thank you. We'll talk a little bit more about funders and drivers in a bit. Hal has been unusually quiet—the longest I’ve heard him. Hal, do you want to talk a little bit about that? And I think you're not the only one who has slides, but you're the second one who has slides.

HAL SINGER:
I apologize in advance for making a very short slide deck, but I wanted to talk to you about the methodology that I’ve been using in my consumer protection cases, product liability cases, with some success.

As I mentioned at the top, we’ve had five classes certified around my impact models, and they all turn on these conjoint studies. Just to tick through the cases—if you guys want to check them out, they have some very good opinions. There’s the smokeless cigarette product marketing case, the MacBook keyboard defect case, and then three COVID-education cases: Pepperdine, USC, and LSU.

It’ll just be easier to show you a few screen grabs of the survey that I used in the MacBook keyboard defect case. The allegation was that the keyboard was prone to being sticky and to otherwise fail. It turned out that about 8% of owners who purchased this type of MacBook suffered keyboard defects—an 8% failure rate.

So, that made things tricky in terms of determining what kind of discount a consumer would have demanded at the time of purchase if they had known that the keyboard was subject to this defect. It’s a probabilistic thing.

So, on our first time through, we want to make sure that we're getting people on the survey who kind of fit the target audience. So, we're going to ask, "Have you ever bought one of these keyboard types before?" If you haven't, you don't make it through the filter—you don't make it through to the survey. We want to make sure that we're targeting the actual types of customers who buy, in this case, a MacBook or a computer.

Now, in this one, the first time through, we decided that we would tell the user that if they saw in their choice screen one of these computers that were subject to the defect, it would happen with 100% probability. We did that because we thought that consumers taking a survey would have a hard time internalizing and processing what an 8% failure rate meant. So, the first time through, we wanted them to assume it would manifest itself with 100%, and then whatever discount they demanded on the price, we would discount that by the probability that it would fail—by 8%. That was the first time through.

This is one of the screener questions. It kind of prepares the reader for what they're seeing when they get taken through the survey. These are the attributes that we're going to put into our survey, and, of course, you have to have the price in any kind of conjoint survey in order to solve for a discount that the consumer would demand to be made whole.

And then, I think we have some decoy defects. We wanted to give the reader an impression of what's going to come next in the survey. This is what a sample choice screen would look like. Each respondent who goes through this is going to get 10 of these screens—10 choice sets—and you always have the option of, "No, I don't want to choose any of those things."

So, here’s option A: a MacBook Pro with a certain price, and you can kind of see when it isn't subject to the defect. What we want is for consumers to basically reveal to us, through their preferences, what their distaste is for the defect in dollar terms. It’s a little different than the survey you mentioned before, where you just ask someone what kind of discount they would demand.

Economists and statisticians recognize that that's not a sound approach because the respondent might know that they could game the system by demanding a high discount to be compensated. So, what the conjoint is doing instead is allowing their choices to reveal what their actual discounts are.

So, the results—what we found—was that we were able to get a $650 discount from that survey if they thought that it was going to fail with certainty. Then, we discounted that by 8%, the probability rate.

The only thing that I wanted to say—and I'll wrap up here—is that Apple, of course, hired its own experts to combat me. They thought that the 8% really needed to be put into the survey. So, we said fine, and we actually went back out and redid a survey with the 8%. It turns out, damages got even bigger when we did that.

MILES ROBINSON:
I will ask you another question. Hal, I mean, as you will have gathered, three of us are primarily on the defendant side of the fence, and Hal is perhaps more on the claimant side. You've talked a little bit about what opposing economists said in the Apple case. More generally, what sort of advice would you give to lawyers who are choosing economists in these types of cases? What are the key things that you would expect them to be asking?

HAL SINGER:
I think that, of course, we want to know, What’s your experience in these cases before?—it’s kind of a gatekeeper. But I want to know, Have you ever used a conjoint in practice and prior litigation? How did it turn out? Have you ever written about conjoint in an academic setting? That would be a nice plus for an expert.

I think that, in my exposure—and I'm just talking with other people in consumer protection cases, product liability cases—it seems like conjoint is the most popular model to go with. The other tool in the economist’s toolkit is regression. Now, there is a regression going on in the background to solve for the required discount—I didn’t want to kill you guys with that—but traditional regression that economists use is really out the window. We really don’t have the opportunity to use regression, so conjoint is the key.

So, I’d want to know, What experience do you have in conjoint? Have you written about it? Have you testified? How did the judge like it?

MILES ROBINSON:
You're clearly favoring the conjoint model, but is there a lot of pushback to that, or do you think that's pretty solid now?

HAL SINGER:
I haven't experienced—in the five cases that I mentioned—someone saying that conjoint couldn't be used for it. That’s not really the fight. The fight is in the implementation of the conjoint.

Did you get the right sample? Did you lead them astray with any screener questions? Did you include the right decoy attributes? Stuff of that nature.

MILES ROBINSON:
Thank you. So, I’m going to go slightly more philosophical here. In terms of what’s behind these kinds of actions—is it funders, is it consumer associations, is it claimant firms, is it even claimants? Who really benefits from these types of actions?

And I suspect Hal might have a slightly different view from some of us—but maybe not, we’ll see. I’ll go to the end of the line first of all.

MATTHEW ANGELUS:
I think that, at least from my experience, not only are the claims primarily plaintiff-counsel driven, but in many cases, the primary benefit ultimately goes to plaintiff's counsel.

Where I practice, the general rule—and there's been a little bit of pushback over the last, frankly, year and a half—is that, at the end of the day, the plaintiff counsel will receive a 30% envelope of the total settlement value or of the total judgment amount. That is a very big incentive to launching and settling cases as frequently as possible.

We also are in an environment where there are very low barriers to entry. It's basically a no-adverse-cost regime—whatever adverse costs exist are very low, in the four-figure range. And there's a publicly funded element to it that advances fees and costs throughout the proceedings for the purpose of the claim.

This means there’s very little downside and a very big pot of gold at the end for plaintiff's counsel.

MILES ROBINSON:
So, plaintiff's counsel is the answer from the far end. I'm gonna go to Mariana now.

MARIANA SOARES DAVID:
Thank you, because I know what Hal was going to say.

In Portugal, we actually have no tradition of funding within law firms, so upon contingency fees. The driving force is expected to be, and continue to be, funders and consumer associations.

But, well, I probably do have a bias, being a defendant lawyer, but for me, it is quite uncertain who actually benefits from these class actions. Consumers should be benefiting, but my biased opinion is that, most of the time, consumer associations and funders are the ones benefiting—especially because of the way the distribution of the awarded amount is handled under Portuguese law.

There is a certain deadline for consumers to claim their share, and it is expected that most of them won’t claim it. This is because we have an opt-out system and a fairly poor summoning procedure, so most consumers don’t actually know they are part of the proceedings. If they don’t claim their share, a significant part of the amount remains unclaimed.

What happens next with the unclaimed amount is that, first, the claimant’s costs will be paid, as well as the funders' fees, with limited control from the court. In Portugal, we like very broad concepts, and the concept used here is a fair and proportionate amount, considering the features and the risks, which leaves a lot of room for interpretation. Then, the remaining amount goes to the Portuguese State, notably for the promotion of other class actions.

So, I’m not entirely sure if consumers are the ones benefiting.

MILES ROBINSON:
Hal, I'll turn the floor over to you for the truth.

HAL SINGER:
It's hard for me to understand how consumers can't benefit in the wins, right? If there's a settlement, and it's a good settlement, and even if the plaintiff attorneys keep 30%, that still seems like a win for consumers.

And, of course, the plaintiff attorneys don’t get paid unless there's a settlement, and that typically doesn’t happen until after you get the class certified—which is hard. So, um, they’re being rewarded for the risk they’re taking, including, you know, the out-of-pocket costs for the experts they have to hire.

So, I’m going to give the answer—the defense counsel is the beneficiary of the regime. They make money whether they win or lose. They bill by the hour.

MARIANA SOARES DAVID:
Not always.

MATTHEW ANGELUS:
I’d push back on that only in terms of the point on the difficulty of certification. The example I gave—we live in a jurisdiction where 75% of cases are certified and with very low barriers to entry, which ultimately means those cases do get settled.

And while it’s true that plaintiffs' counsel needs to be successful to get paid, of those 75% of cases that are certified, the vast majority—well above 95%—get settled before trial.

MARIANA SOARES DAVID:
I also like to challenge that for different reasons. First, because of this particular feature of Portuguese law, where consumers don’t actually know they’re being represented, so sometimes they don’t claim their share of the settlement or of the award.

But also because, under Portuguese law, regardless of the amount you actually claim—and you can be claiming a million in compensation—the notional amount of the procedure will be €60,000. Sometimes, the claim doesn’t actually frame the claim in terms of the exact amount they want; it will be defined at a later stage.

This is to explain that sometimes clients don’t actually have a real perception of the financial risk at stake, and so it’s quite difficult to apply high rates in these sorts of cases.

MILES ROBINSON:
Thinking about the defendant’s perspective, I suppose the sort of manufacturer perspective—and again, this is not particularly a legal question, more of a philosophical one.

Do these class actions improve product safety? So, is there a sort of benefit in that sense to consumers, or do they actually have the effect of stifling innovation because of fear?

Hal, do you want to take that one?

HAL SINGER:
I would think that, relative to a world where you could get away with anything, I would hope that this would incentivize firms to take more caution with respect to product safety.

The problem is that proving that would be difficult because you’d need an experiment, right? You’d need to toggle from a regime of protection to no protection and then see what happens to safety. But I think, as an economist, my prior would be that, relative to the jungle, if a firm knew that it would be exposed to liability for making a defective product, it’s going to make the products better. That’s a good thing.

MILES ROBINSON:
But in terms of motivation for the business, I mean, are they not motivated to make sure that their products are safe and well received by consumers?

HAL SINGER:
If they thought they could get away with it, my concern would be that they would cut corners, and consumers would suffer as a result.

MILES ROBINSON:
Matthew, you’re shaking your head quite vigorously…

MATTHEW ANGELUS:
I would certainly say that class actions have impacted the landscape. I don’t think—to Hal’s point—that you could ever toggle that scenario.

The environment we see with very easily authorized or certified class actions is one that certainly has legal departments, especially internal departments but external as well, operating as a sort of Doctor No—saying, No, this innovation is maybe not quite compliant with the letter of regulations, which might be 30 or 40 years old.

This is especially true in highly regulated spaces, and these spaces tend to have a very active government regulator as well. So, it’s not true that the absence of a class action space would yield a wild west scenario where industry action is functioning unimpeded.

MARIANA SOARES DAVID:
Yeah, I would agree with Matthew, also because we have seen, at the EU level, an increase in legislation introducing all sorts of new safety requirements, among other things, and usually, they are followed by misdemeanor proceedings.

So, I’m not entirely sure that class actions are the only—or the most favorable—way to increase product safety, although, of course, they keep companies in line.

MILES ROBINSON:
I think, from my perspective as a consumer—we all are—there is a difference between wanting compensation and wanting a change of behavior or wanting bad behavior to be punished.

Depending on the size of the issue, the size of the claim—definitely, if it's a smaller claim—consumers will be less interested, I think, in the money side of it but more interested in a change of behavior.

In my perspective, is there a better way?

HAL SINGER:
Well, can I just respond to something? One alternative is public enforcement, right? If not private enforcement, then public enforcement.

But—and I hope they let me back into the country today after I say this—you know, we have a party that doesn’t want to enforce certain laws, particularly as they relate to consumer protection. So, I mean, who’s going to be the enforcer then? And that happens every four years.

And then, even if you have a party that’s inclined to protect consumers, they’re limited by resources, so they can’t be prosecuting every case that comes under the sun. So, I think private enforcement does fill a nice gap that would otherwise exist—and would be colossal every four years.

MILES ROBINSON:
What about some sort of, um, mix-and-match approach, where you have some kind of judicial intervention but then a sort of compensation scheme to pick up consumers rather than them having to go through the courts?

Mariana, what do you think about that? Do you think that would work in Portugal or more widely?

MARIANA SOARES DAVID:
I would, then again, with my bias against class actions as they are frequently framed, actually feel that any sort of alternative path could have a stronger role.

And I do feel that—well, I’ve touched on that based on the misdemeanor proceedings—and I do feel that there we often have a more serious approach to breaches of safety.

MATTHEW ANGELUS:
I think that option is interesting, and I think the only thing that I would add is that there are different regimes that can exist.

For example, a public insurer model—we have it with respect to extended warranties on these same goods—where the amount of the benefit is kept in trust for a certain period of time, and it avoids the judicialization of these proceedings on a macro scale, which goes beyond the individual.

MILES ROBINSON:
Moving away from the philosophical aspects of this. Quick question before we turn over to the floor—a couple of quick questions.

One, what advice would you give to a business facing a product liability group action, Mariana?

MARIANA SOARES DAVID:
The first is, as a defendant lawyer, to engage legal counsel as early as possible.

But then—and this has to do with the upcoming new product liability directive—the need to collect and preserve evidence, safety reports from the start, to prepare a solid legal and reputational defense.

Almost always involve PR and technical experts from the start, consider settlement options, of course, and ponder counterattack measures.

Again, I’m referring to the Portuguese landscape, notably for bad faith litigation requests. I obviously know that some class actions are real and they’re solid—some aren’t—and clients must have the opportunity to challenge them in some sort of way.

MATTHEW ANGELUS:
I think it's important to use the opening stages of a proceeding as an inflection point.

If there is liability—and there are cases where there is that liability—it’s a good occasion to try to end the case quickly through settlement. But if you genuinely believe that your product is good, that your product is free of defect—fight. Fight it out.

If every case settles, there’s a massive incentive to take every minor irritance and turn it into a class action. But by fighting it out and actually winning—and there are examples where just by taking it out—if you believe in your product, defend your product.

MILES ROBINSON:
What do you think is going to be happening in five years' time in this area—more or less activity?

HAL SINGER:
It's hard to say more or less. I don’t know if I have a strong feeling about that.

It seems like—well, and I can speak to the jurisdictions where I play—but it seems like it’s pretty strong right now, so I don’t know how it could get stronger. How about just sideways?

Also, you didn’t let me agree—I like this answer too, by the way. Fight it out. Don’t settle. I like that. That’s very good advice—the same advice I would give.

MATTHEW ANGELUS:
I agree. I’d say sideways. If you’re in a mature class action environment, I don’t think there are going to be more product liability class actions, but I don’t think there will be less.

MILES ROBINSON:
Mariana, I’ll finish with you on that question. And perhaps, in terms of legislative changes across Europe, do you think that’s going to drive change?

MARIANA SOARES DAVID:
I actually do, so I would disagree with both of you.

I would assume that we still have room for—I'm not sure if this is good or bad—but we still have room for more class actions, even regarding different causes of action.

The RAD (Representative Actions Directive) actually contains an annex with different possibilities for causes of action, and we haven’t—well, claims haven’t—explored all of them. I think we will continue to see this. The EU is really good at making new rules, so we will continue to have much more legislation in this area.

We will have increasingly complex products, and I would just like to point out what I think will be—well, we can have a lot of AI-related class actions, ESG-related class actions when referring to products, which is the scope of our panel.

Finally, I would point out the new EU regulation on product safety, which will come into force in December this year, and the new product liability directive. Both of these, like the Omnibus Directive, intend to include software and other digital products in the concept of a product.

And, well, the system itself is much more claimant-friendly, including a lot of rebuttable presumptions and disclosure requests, which are not that usual under the Portuguese legal framework.

MILES ROBINSON:
I think, looking at the time, we’ve got about five minutes left, so I’ve got a couple more questions that I can ask you, but I’d prefer to open it up to the floor.

Q&A - Summary of the Discussion

The panel covered various perspectives on class actions, certification processes, litigation timelines, and methodologies used in product liability cases.

1. Class Action Certification Differences – It was highlighted that while around 70% of class claims in product liability cases are certified in Canada, the US has a much stricter certification process, especially after recent Supreme Court rulings. Unlike some jurisdictions with a more lenient approach, the US requires more rigorous certification.
2. Effectiveness of Injunctive Relief vs. Damages – The discussion explored whether injunctive relief (forcing companies to change behavior) is sufficient or if financial penalties are necessary. One panelist argued that companies are unlikely to make meaningful changes unless they face substantial financial consequences, as seen in US cases. Others suggested that both injunctive relief and compensation are needed to balance consumer motivation and corporate accountability.
3. Litigation Timelines in Canada and Portugal – The average duration of class action litigation varies. In Canada, certification can take about a year, but cases on the merits can last from a few years to over a decade. In Portugal, official statistics suggest first-instance decisions within two years, but many consumer class actions are still pending. A notable environmental class action with 110 witnesses was decided in just 1.5 years.
4. Use of Conjoint Analysis in Product Liability Cases – A question arose regarding whether conjoint analysis (a survey-based economic model) could be applied in cases where the consumer does not directly pay for a product, such as fertility market devices or pharmaceuticals covered by insurers. While some argued that patient opinions still hold value, others pointed out that insurers might be more relevant decision-makers in such cases. The discussion acknowledged that this is an evolving area with potential legal challenges.

The full video of this conversation is available below.