Are The Netherlands reneging on third party litigation funding? Stichting Investor Loss Compensation and Airbus Investor Recovery Stichting v Airbus. First instance court Den Haag puts big question mark next to third party funded collective (investor) claims.

The first instance court at Den Haag has held in joined cases Stichting Investor Loss Compensation and Airbus Investor Recovery Stichting v Airbus ECLI:NL:RBDHA:2023 [‘SILC’ and ‘AIRS’ v Airbus] dismissing both claims (introduced under the Dutch collective action aka class action ‘WAMCA’ procedure) as inadmissible. The case is an echo of Airbus Investors Recovery Limited v Airbus (‘AIR’ v Airbus), where the first instance  court at Amsterdam in a claim that is not a WAMCA claim, held (as I report here unconvincingly) on applicable  law under Rome II.

Current case first of all is of interest for the relative ease with which the court accepts jurisdiction. The claim against Airbus SE incorporated at Leiden obviously meets the Article 4 Brussels Ia domicile gateway. Against the  other EU-based defendants, jurisdiction on the basis of Article 25 of the Brussels Ia Regulation (choice of court) was justifiably dismissed. The court held [5.6] that unilateral statements on directors’ professional address in Airbus’ annual reports hardly constitute choice of court.

Jurisdiction was however upheld on the basis of the anchor defendant mechanism: [5.11] ff on the basis of A8(1) BIa against the EU-domiciled members of Airbus’ Board and [5.23] ff on the basis of the Dutch residual CPR rules against the non-EU-domiciled members of the Board, seeing as the claim reproaches Airbus, the anchor defendant, of not timely having communicated let alone acted viz bribery within the corporation, and the Board’s direct responsibility for such communication. For that reason (and with an important flag here viz future claim formulation) it dismisses [5.14] ff jurisdiction on the basis of A8(1) against the CFOs who were not a member of the Board: claims against them are not related to the A4 claim v Airbus. These two CFOs also escape jurisdiction on the basis of A7(2) forum delicti with reference to CJEU Ofab: they are not directors of the NL-based defendant and their activities (and alleged omissions) were not supposed to take place in NL.

The remainder of the judgment then discusses various issues of the Dutch collective action regime on which others will know a lot more. It includes interesting discussion of the transition between the old WCAM and the new WAMCA.  The claim of AIRS is held [5.85] to be inadmissible on grounds of the Stichting not being representative.

SILC’s claim is held [5.108] ff to be inadmissible on grounds related to (real or perceived) warnings in WAMCA’s travaux against too much undue influence of third party litigation funders and the presence in SILC’s board of, and alleged  risk of SILC dependency on, DRRT (a Bahama-based law firm specialising in mass torts) and Therium, a third party litigation funder.

This part of the judgment (one assumes appeal) no doubt will be read with interest by funders generally.

Geert.