The Global Convergence of Global Settlements

Conventional wisdom says that the American-style class action will never go global. Even as some countries develop innovative ways to handle enormous cases—from Netherland’s settlement-only approach to mass torts to Japan’s recent adoption of class actions—a number of factors have slowed their growth abroad. Such barriers include: (1) bans on contingency fees, (2) “loser-pay” rules that increase the financial risk of complex litigation for plaintiffs, and (3) collective actions that, in many cases, require that all parties affirmatively “opt-in” to participate. These features of collective actions will continue to limit the incentives, stakes, and finality of large settlements forged overseas. This resistance reflects, in some ways, what some say is the uniquely “bottom-up” nature of American litigation. In “top-down” justice