Israeli Class Action Law 2006: a comprehensive summary

Amit Manor

Amit Manor – Yuki Shemesh, Tel-Aviv

amit@mslaw.co.il

The Israeli Class Action Law, enacted in 2006, serves as a legal mechanism allowing a group of individuals who have been similarly harmed by a specific entity (such as a corporation or public authority) to unite and file a class action lawsuit. This law enables any member of the group to sue on behalf of the entire group, facilitating the enforcement of collective rights in an efficient and cost-effective manner.

The mechanism of the Israeli Class Actions Law is similar in many aspects to the American class action mechanism.

To file a class action, certain conditions must be met:

1. Clearly defined group of affected individuals: there must be a demonstrable group that has been similarly harmed.
2. Proof of damage: the plaintiff must show that damage was inflicted on the group members.
3. Suitability and fairness: the action must be deemed suitable and fair to proceed as a class action.
4. Adequate representation: the plaintiff must demonstrate the ability to adequately represent the interests of the entire group.

The process in Israel has a two-stage procedure. It begins with the submission of a motion to certify the lawsuit as a class action. The request must include details about the group, the damages incurred and the legal grounds for the claim. The court will examine whether the conditions for filing a class action are met and will also examine in this stage the merits of the case. If the motion for certification is granted, the lawsuit proceeds as a class action (the second stage). Class members can opt-out from the class at this stage.

A class action can be concluded in several ways:

• Judgment: if the court rules in favor of the class, it will award compensation to the class members.
• Settlement: the parties may reach a settlement, subject to court approval, which will ensure that the settlement is fair and reasonable for all group members.

In case of a judgement or a settlement the lead council receives fees approved by the court, usually a percentage of the awarded compensation.

Over the years, thousands of class actions have been filed in Israel across various fields, including consumer protection, labour law, torts, securities, privacy, anti-trust and environmental issues.

The Israeli Class Action Law is a vital legal tool for enforcing individual and collective rights and deterring entities from widespread violations of the law. Despite its many advantages, it also presents challenges and complexities that must be considered when managing a class action. The law requires a balance between protecting the rights of the injured parties and maintaining principles of justice and fairness for all involved parties.