The challenge of mass litigation and its successful defense

The initial situation

In recent years, the number of mass proceedings involving a large number of plaintiffs has been increasing. On the plaintiff side, numerous law firms have identified the potential to exploit new or additional revenue potential by standardizing similar cases. On the defendant side, more and more companies as well as public authorities are facing growing challenges to defend themselves efficiently and successfully. The best-known examples are, above all, the diesel proceedings against the major German car manufacturers. In 2020 alone, 30,000 proceedings were pending at the 24 higher regional courts nationwide; in the previous year, the number was as high as 40,000 (FAZ, July 13, 2021). Also not to be underestimated are the lawsuits against various private health insurers for the recovery of premium increases, lawsuits for violations of the General Data Protection Regulation (GDPR), lawsuits in connection with mask procurement or for the recovery of Corona aid or the rejection of applications for Corona aid by the administration.

The challenge

On the defendant’s side, each case involves thousands of more or less similar, individual proceedings that have to be processed accordingly. Handling such a mass of cases efficiently and to a high standard of quality poses high demands on process management. Even the large number of different communication processes between the parties involved must be managed. This is not limited to external communication between client, attorney, opposing party and court. Also internal communication processes within the law firm must be handled. In addition, there are often large volumes of heterogeneous data that need to be processed, since a large number of different law firms are involved on the plaintiffs' side. These volumes of data must be collected, structured and analyzed. In the meantime, clients are not willing to pay for a multitude of more or less similar proceedings on the basis of hourly rates, but insist on flat rates or billing according to legal fees under the German Lawyers' Remuneration Act. As a result, the question of transparency and efficiency of legal work is increasingly coming into focus.

The Solution

IT-based platforms such as JUNE use software to help law firms like CLASSREACTION to handle such mass proceedings efficiently and with high quality. Usually, lawyers with different professional specializations work together in teams. The technology supports the team of lawyers who are familiar with defending mass proceedings. Automated processes and workflows relieve the teams of administrative workload and support them in internal communication and collaboration. Tasks are automatically assigned to teams or a person in order to always provide an overview of upcoming deadlines and tasks that need to be completed. This allows to focus on the substantive tasks and work efficiently. Collaboration is supported on a platform with access to a consistent database, and additional communication effort due to email communication is avoided. As a result, all processes are transparent and traceable.

The IT-supported platform primarily automates external communication processes. The software automatically retrieves incoming messages via appropriate interfaces (especially to the electronic lawyer's mailbox - beA). This eliminates the need for manual uploads and downloads, which are usually organized on a decentralized basis. The information on the documents received is already recorded and automatically assigned to the relevant file. With the help of artificial intelligence (rule-based processes, machine learning and natural language processing), the tool can recognize and record data from typical documents (lawsuits, summonses, extensions of time limits, etc.) and assign them to the relevant processors. In particular, file data such as names or addresses of the parties to the lawsuit and their representatives as well as deadlines can be detected and recorded in this way. It is also possible to detect individual data. Through a combination of different approaches, a high extraction quality and low post-processing requirements are achieved.
However, the technical possibilities for automation, standardization and scaling are facing limits. For example, it is still far from being possible to fully automate complex processes such as litigation. The behavior of the various parties involved and the content influencing the progress of the proceedings are too imponderable. As some court decisions make clear (Federal Court of Justice decision of 27.05.2008 - XI ZB 41/06; Higher Regional Court of Naumburg of 12.09.2019 - 1 U 168/18), the requirements of the German Code of Civil Procedure also set legal limits to mass proceedings. Thus, the pleadings must comply with the specificity requirement under Section 253 II No. 2 German Code of Civil Procedure. It is typical for mass actions that the facts are essentially the same, but naturally differ in the respective individual case. If the requirement of specificity is violated due to insufficient explanations, the action is not admissible. The same applies to the requirement of specificity in the statement of grounds for appeal under Section 520 III of the German Code of Civil Procedure. This is the case, for example, if a notice of appeal is largely composed of text modules and pleadings relating to other legal disputes and only sporadically addresses the challenged judgment of the court of first instance.

In addition, JUNE makes it possible to present the efficiency of the processes in a transparent manner. With the help of the data collected on the work processes, corresponding reports can be generated automatically and in real time. This provides the processing law firm with important information about the way cases are handled and the necessary information for cost control. Based on operational key figures (for example, on the workload of individual teams), excessive workload can be controlled and potential bottlenecks can be avoided. In addition, the reports also provide an up-to-date picture of strategic issues and offer a correspondingly sound basis for decision-making. For example, on questions such as which law firms or courts handle the most cases and how these are decided by the various courts as well as in the various instances. If necessary, the outcome of proceedings can be predicted. Above all, certain groups of cases can be effectively processed according to uniform standards and the quality of processing can also be constantly improved.
 

Success factor people

Despite all the advantages of automation, in the end the human being remains the decisive factor for success. The processes must be accepted and supported by the team. As long as the technology is met with skepticism or even rejection, and as long as lawyers in particular remain lone wolves and close their minds to collaboration, there will be limits to automation. For this reason, lawyers must be prepared to shake up their self-image and self-realization in individual cases. Then, and only then, can they work hand in hand with qualified technical personnel such as legal engineers, project managers, software developers and on the basis of suitable software to fully exploit the potential of automation and work not only more efficiently, but also qualitatively better. For this reason, the stakeholders must be involved in the design and implementation process as early as the introduction of the appropriate technological solution, and the processes must be tailored to the needs of the users in the best possible way. This is why the introduction of a new technology is never an out-of-the-box solution that can simply be installed and be done with it, but rather, above all for the law firm, a complex process that must be gone through, be accompanied and steered accordingly.

_{Published: December 2022}