![]() Again borrowing terms from other civil law countries, the new laws permit collective actions to protect "collective rights" (through collective actions "in the strict sense") and "homogenous individual rights" (through "individual homogenous actions.") Both types of actions proceed in two stages: a first stage to establish a defendant's liability and a second stage in which individuals may opt in within 18 months after entry of the judgment to prove their entitlement to an individual damage award. The new laws authorize collective actions to recover both general relief ( i.e., relief that benefits all other class members) and individual damages in two situations. ![]() Two Types of Opt-In Actions: Individual Damages Available There is no requirement for an individual to affirmatively opt out of this type of collective action to preserve a right to pursue claims on an individual basis. Individual damages are not contemplated in this type of collective action. For example, the plaintiff class in an environmental case might seek an injunction against further harm and damages to be used to clean up the region. The relief sought must be general, such that it necessarily benefits all other class members. "Diffuse" Collective Actions: Individual Damages Not Availableīorrowing a concept from Brazilian law, the new laws authorize what they term a "diffuse" collective action to protect rights that are indivisible in nature, such as lawsuits to enjoin environmental damage or false advertising. The three types are: "diffuse" collective actions, collective actions "in the strict sense," and "individual homogenous actions." All three types of collective actions borrow legal terminology and concepts from the collective action laws in other civil law countries such as Brazil and Italy and incorporate certain aspects of U.S. The amendments create three types of collective actions and describe who may bring such actions, the procedures to be followed, and the available remedies. Mexico does not differentiate collective actions by the type of harm, but rather by the type of rights the action seeks to protect. These amendments include a major addition to Mexico's Federal Code of Civil Procedure (the "Code") that authorizes collective actions in cases involving harm to consumers of public and private goods or services or harm to the environment. On August 30, 2011, the Mexican Congress published amendments to various federal laws to authorize collective actions and identify the types of claims for which they are available. On July 29, 2010, the Mexican Constitution was amended to create the "collective" action, a procedure analogous to class actions in the U.S. For practitioners familiar with class actions in the United States or collective actions in Brazil, this Commentary also summarizes the key similarities and differences between Mexico's new laws and the more established rules in these jurisdictions. ![]() This Commentary highlights the most significant aspects of the new laws and the risks that the new laws pose to companies doing business in Mexico. The new laws will establish procedural rules that disadvantage defendants in several respects, including by giving defendants only five business days to oppose class treatment and by allowing potential claimants to await the outcome of the action and then opt in to the class after the plaintiffs have won and judgment has been entered. Through these suits, federal courts in Mexico will be authorized to award classwide damages and injunctive relief, including product recalls and orders to remediate environmental damage. ![]() Under a series of new laws, private plaintiffs, government entities, and certain nonprofits may bring consumer, financial, antitrust, and environmental claims as class, or "collective," lawsuits. Beginning March 1, 2012, companies doing business in Mexico will face the risk of class action lawsuits in Mexican federal courts. ![]()
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