by Sylwester Frazzoni
The Competition Appeal Tribunal (CAT) has approved the latest proposed settlement in the long-running McLaren v MOL/NYK collective proceedings, but only after issuing unusually pointed warnings about the risks of endorsing outcomes that fall materially below the damages the Tribunal believes could have been awarded had judgment been handed down.
At a hearing on 15 January 2026, the Settlement Tribunal considered a joint application for a Collective Settlement Approval Order (CSAO) relating to a £54m settlement between the class representative, Mark McLaren Class Representative Ltd, and the remaining settling defendants MOL (Europe Africa) Ltd and NYK.
While the Tribunal was ultimately satisfied that the settlement could be approved as “just and reasonable”, its reasoning—delivered after extensive exchanges with counsel—reveals significant discomfort with the scale of the discount relative to the Tribunal’s own provisional assessment of the merits.
A Strong Case, But No Judgment
The Tribunal emphasised that this application differed fundamentally from earlier settlements in the proceedings. Unlike the 2023 and 2024 deals, the case has now been fully tried, with extensive expert and factual evidence heard and judgment reserved.
Against that background, the Tribunal stated it was “pretty confident” that the class had a strong case and that, absent settlement, “substantial damages” would likely have been awarded. Based on the evidence at trial, the Tribunal considered that total damages could well have exceeded the figures advanced by the defendants, and may have approached—though not necessarily matched—the claimant’s headline estimate of £215.8m including interest.
That assessment sharpened the Tribunal’s concern: if the case was indeed strong, why approve a settlement struck at a materially lower level than the likely trial outcome?
Discount Versus Certainty
Counsel for the class representative pointed to the remaining litigation risks, including a further hearing on attribution of liability between defendants, potential appeals, and the cost and delay associated with post-judgment proceedings. Even after trial, those steps could add many months and millions of pounds in additional expense.
The Tribunal accepted that uncertainty still existed, but repeatedly pressed the parties on whether those risks truly justified settling at what it described as “the lower end of the range” of possible outcomes. It noted that, on its own assessment, there was “a reasonably good prospect” of a judgment exceeding the settlement figure, albeit with no guarantee.
This tension—between certainty now and potentially higher recovery later—lay at the heart of the Tribunal’s analysis.
Take-Up, Distribution And The Shadow Of Gutmann
A second, and in some respects more acute, concern was take-up by class members. Drawing explicitly on the experience of Gutmann v First MTR South Western Trains, the Tribunal warned against collective proceedings that deliver headline recoveries but little real compensation to consumers.
Survey evidence presented to the Tribunal suggested that individual consumer take-up may be very low, particularly where per-vehicle compensation could amount to only a few pounds for events that occurred more than a decade ago. While the Tribunal accepted that fleet purchasers might generate higher claims, it expressed scepticism that total claims would exceed the guaranteed damages pot, let alone reach the upper end of the settlement structure.
The Tribunal stressed that the ultimate success of the proceedings would be judged not by settlement figures but by what class members actually receive. It made clear that it would scrutinise the forthcoming distribution plan closely and expected proactive engagement with large fleet operators before final approval.
Charity As A Backstop—Not A Panacea
As with earlier settlements in the case, unclaimed sums are to be paid to charity rather than reverting to defendants. The Tribunal accepted this structure as preferable to reversion, noting the involvement of the Access to Justice Foundation and its track record in administering funds for public benefit.
However, the Tribunal was careful to underline that charitable distribution could not be used to mask a failure of the collective regime to deliver compensation to class members themselves. It reiterated that collective actions must be brought “for the benefit of the class members and the public”, not primarily for funders or other stakeholders.
Funding, Costs And Regulatory Context
The hearing also took place against the backdrop of ongoing government consideration of reforms to the collective proceedings regime, including funding and costs. The Tribunal explicitly acknowledged that its approach in this case could have wider implications for the market.
While recognising the critical role played by litigation funders, insurers and lawyers—particularly in a case commenced six years ago, before the regime had matured—the Tribunal warned against outcomes that could undermine public confidence. It cautioned that approving settlements perceived as disproportionately favouring stakeholders risked weakening one of the “legs” on which the collective actions system stands.
At the same time, the Tribunal accepted that refusing to recognise funders’ contributions at all could chill future cases, especially complex consumer claims with low individual value.
Approval, With A Warning
In the end, the Tribunal concluded that the settlement could be approved, describing it as “not unreasonably low” even if at the bottom of the acceptable range. Crucially, however, it framed approval as provisional in a broader sense: the real test would come at distribution, when take-up rates and actual payments to class members become clear.
The message was unmistakable. As the UK government weighs reforms to collective actions, the CAT is signalling that post-trial settlements at steep discounts will face exacting scrutiny—and that certainty alone will not justify walking away from a strong case if consumers are left with little to show for it.
The case is Mark McLaren Class Representative Limited v MOL (Europe Africa) Ltd and Others in the CAT.
