This article was originally published on 14 August 2025 (Czech version can be found here).
Czech court issues first judgement in class action lawsuit: What does it mean for future proceedings?
A court recently issued an historic ruling on the first class action lawsuit in the Czech Republic.
The Municipal Court in Prague ruled in favour of the claimant, upholding the claim almost in its entirety1. But only a few days have passed since the written version of the court’s ruling was officially published. It contains several interesting insights on the nature and course of the entire dispute that the general public might not have known until now.
Even though the matter isn’t yet resolved with final legal force and both sides have time to file an appeal, we can look at some of these insights.
A brief recap of the proceedings so far
The class action case was brought by the Czech nonprofit organisation OnlineADR.cz, z.ú., against Postýlkov s.r.o., a Czech furniture company.
The defendant was accused of collecting money from several dozens of consumers for advance payments on children’s furniture they’d ordered. But the defendant failed to deliver the goods to any of them or refund the money. With the exception of four consumers who joined the class action, the court upheld all other registered claims.
As the proceedings have still not been finalised, in this article we won’t be analysing the court’s considerations or providing a substantive assessment of the case. The aim of this article is to highlight what the court decision reveals about the specifics and peculiarities of class action proceedings as a completely new procedural tool under Czech law and how the decision might affect similar future disputes.
Certification stage should not be underestimated
One important point to note in the context of this case is that the defendant was completely passive most of the time. It only started to actively defend itself at the first oral hearing, more than six months after the action was filed. As a result, some of its objections had to be rejected, even though they could have been relevant. According to the court, given the nature of the objections, the defendant should have raised them during the certification stage. This is the phase when the court decides whether to admit the class action at all and its decision can be appealed.
The judgement explicitly confirms the need to distinguish between various groups of potential objections. For those that are relevant to the court considering the admissibility of a class action, the defendant shouldn’t delay in raising them. This is because the court might not take them into account at a later (merit) stage of the proceedings. Examples from other countries show the certification stage is often crucial from the defendant’s point of view. When properly approached through qualified legal representation, a class action can be entirely avoided at that stage.
On the other hand, this decision also shows that even if some claims served as a foundation for issuing a positive certification decision, this doesn’t guarantee they’ll be upheld in the final judgment.
In this case, proceedings originally involved four consumers’ claims that were finally dismissed. It emerged that, although the defendant didn’t mention this in its defence during the certification phase, these consumers had in fact received the goods they’d ordered. If they had reservations with respect to the quality of the goods, the objections relate to liability for defects and are outside the defined scope of the class action proceedings. In other words, different factual findings and legal considerations would need to be applied with respect to these four claims.
This can be illustrated by application No. 9, claiming CZK23,706. It was attached to the original lawsuit and helped to make up the number of consumers needed to get the minimum of ten for the claim to be admissible under Czech law. If the defendant had been active in the certification phase, it could have raised objections to the claim. But the key point in the context of the prior considerations is that the court didn’t classify this type of deficiency as one to be addressed solely during the certification stage, which would mean that the defendant’s passivity would deprive him of the opportunity to defend himself against the claim in the phase on the merits of the case.
What to bear in mind when formulating a class action lawsuit
Another notable feature of the judgement is the court’s “discreet” advice to the entities bringing a class action. First, the court emphasized the claimant’s obligation to properly review the applications received from consumers and not to accept those that request something different or exceed the scope of the proceedings within the meaning of Section 35 of the Act on civil class proceedings.
Why is this important? Because the court sanctioned the claimant for inaccuracy when deciding on costs of proceedings. In this particular case, it concerned the four applications mentioned above with relation to which the proceedings were suspended. From a procedural point of view, the claimant was responsible for the partial suspension of the proceedings by incorrectly including claims that had been filed beyond the scope of the class action. Therefore, the court made a proportionate reduction in the claimant’s awarded costs of proceedings. This is certainly an aspect for potential claimants to bear in mind for any future proceedings.
This observation is directly linked to another of the court’s reservations: that default interest could only be awarded to 2 out of more than 50 participating consumers, as only these 2 expressly included such a claim in their applications. The court pointed out that the nonprofit organisation, acting as the claimant, could have prevented this outcome. As the judgement states: “Nothing prevented the claimant from instructing the participating consumers and guiding them on how to supplement their applications, if necessary, in accordance with Section 34 in conjunction with Section 9(3) of the Act on civil class proceedings”. (Point 68 of the judgement).
Claimants, defendants, legal representatives, and the courts will all need some time to adjust to the new institute of class action. With each proceeding, new insights will emerge, gradually revealing what specific factors must be considered in relation to class action proceedings. Legal practitioners will then have the opportunity to highlight these specific issues, as this article aims to do.
Could calculating claimant’s remuneration affect consumers’ behaviour?
We’ll now look at another feature of class action proceedings that the written judgement helps to reveal – the amount the participating consumers received based on the judgement.
The judgement shows that the consumers didn’t receive the full amount of their previous advance payments to Postýlkov. The claimant (a nonprofit organisation) received 16% of each advance payment as its remuneration. So it’s not accurate, as some comments incorrectly state, that the claimant’s compensation is a kind of a penalty paid by the defendant beyond its obligation to return the amounts originally received and that the participating consumers lose nothing.
In many circumstances, the claimant’s remuneration will be well-deserved in light of the risk taken and the effort put into the case. However, consumers considering joining a class action should be aware that the claimant’s remuneration is something that will be deducted from the consumers’ payment if the lawsuit succeeds. The remuneration shall be set in certification decision and could be up to 16% of the awarded amount.
Class action participants (consumers) benefit in a number of ways, such as zero court fees or costs of legal representation, which they would typically have to pay if pursuing their claims individually. Nevertheless, in the future, consumers may simply wait for the outcome of a class action, for example against a financial institution. If the decision is favourable, they could then submit their own individual claim to the financial arbitrator at no cost, using the judgement as guidance that their case will reach the same result. Assuming the consumer’s claim doesn’t become time-barred during the class action proceedings, this “wait-and-see” approach cannot be ruled out.
For example, imagine a situation in which 20 class action participants (consumers) – rather “pioneers” in this hypothetical scenario – win a class action proceeding. Then another 500 consumers with identical claims turn to the financial arbitrator where they won’t have to pay the 16% to the claimant. Depending on the specific circumstances, 16% of the payment might be a significant amount for many individuals. The defendant financial institution will – under pressure from the existing class action ruling – most likely agree to settle based upon the arbitrator’s request. However, this does not change the reality that the cases will tie up the arbitrator’s capacity and that the proclaimed benefits of class action in terms of procedural economy or facilitating the enforcement of minor claims may not be fully realized.
The scenario described above, which has been considerably simplified for the purposes of this article, may not necessarily occur; only time will tell. But it’s one of many examples of how class actions could have unexpected consequences.
Conclusion
In this article we highlighted some aspects of the first class action judgement that may have broader implications. These mainly include the court’s approach to some rather conceptual issues that could set a precedent for future cases. Assuming that the volume of work remains constant, only two judges should decide on class action cases according to the Municipal Court in Prague’s work schedule.
At the time of writing, the parties still have time to file an appeal, and if any of them decide to do so, it will be interesting to observe how the appellate court views the whole case (perhaps including some of the issues raised above). We will continue to monitor the case and report on its progress.
1Judgement of the Municipal Court in Prague dated 1 July 2025, ref. no. 3 C 10/2024-75.
