UK class action regime faces new test with 'multi-billion' Microsoft claim

Stewarts is representing proposed class representative and former CPS barrister Alexander Wolfson in a blockbuster opt-out class action filed this week against Microsoft, accusing the tech giant of abusing its market dominance to inflate software licensing prices across the UK.

Filed on Wednesday (14 May), the claim is backed by funder Harbour and could become one of the largest class actions in UK legal history with potential damages running into the billions, according to Stewarts.

The case targets Microsoft’s licensing practices for products like Windows and Office, alleging: “the software giant abused its market dominance and engaged in conduct that restricted competition to its new licences from pre-owned licences for Microsoft products. That conduct affected and inflated the prices of both new licences and pre-owned licences.”

Advising

The claim is being run by Kate Pollock, Stewarts’ head of competition, alongside partners Stuart Carson and Marc Jones. Counsel from Monckton and Matrix Chambers are on board, with a team of economic experts lined up to back the case.

Pollock said Microsoft’s practices "effectively shut down competition and inflated prices" and argued the claim could bring greater fairness to the UK’s increasingly digital economy.

What they said

Alexander Wolfson, class representative, said: "Microsoft’s actions have had a significant and far-reaching impact on UK consumers, businesses and public bodies."

"This claim seeks to hold Microsoft to account and to secure compensation for the many affected members of the class. With billions of pounds potentially at stake, this case is about ensuring fairness in the digital marketplace and ensuring even the largest tech companies play by the rules."

Ellora MacPherson, Harbour’s chief investment officer, said:

"This action is likely to be one of the largest the UK has seen and is an example of how big corporate entities can be held to account."

Context: a regime under the spotlight

The Microsoft claim lands at a moment of scrutiny for the UK’s opt-out class action regime which was introduced under the Consumer Rights Act 2015, allowing US-style class actions for competition law claims to be brought in the UK for the first time.

The claim comes just months after the headline-making Merricks v Mastercard case, led by class rep Walter Merricks, settled for just £200 million despite being originally valued at up to £14 billion, with much of the payout going to lawyers and funders rather than class members.

The dispute sparked a very public spat between funder Innsworth and Merricks that reached a head in January when Innsworth launched arbitration proceedings against Merricks over his decision to settle, with Mastercard (who Merricks was suing) agreeing to give him up to £10 million to cover his defence.

Meanwhile, Simmons & Simmons secured a landmark win for client BT in December, defeating a £1.3 billion consumer claim in what was the first UK opt-out class action to actually reach trial.

Reflecting on the case, Fladgate disputes partner Leigh Callaway said the decision in Le Patourel v BT may have turned on its facts, but the bigger picture still stands:

"Group claims remain an important means of holding corporates to account. The resilience of consumers and representatives to pursue redress remains undiminished."

If certified, the Microsoft claim will rank among the most high-profile UK class actions yet, and mark another big test of the still-evolving collective action system.