Severn Trent Plc faces an environment class action lawsuit in London over allegations it abused its dominant position in the utilities market and underreported instances where it pumped sewage into open water.
(Bloomberg) — Severn Trent Plc faces an environment class action lawsuit in London over allegations it abused its dominant position in the utilities market and underreported instances where it pumped sewage into open water.
Law firm Leigh Day filed England’s first ever competition abuse case focused on environmental laws and reporting to regulators, according to a statement Wednesday. A panel of judges will need to approve the case as a class action before it can proceed to a full trial.
Public anger is high toward England’s privatized water companies as sewage discharge into rivers and the sea still increases. Last year, 10 water and sewage companies within England released sewage into rivers and the sea on 301,091 occasions, with United Utilities Group Plc and Yorkshire Water were responsible for 40% of the spills.
The UK government announced legislation to crack down on polluters that befoul UK rivers and seas, promising unlimited penalties, tougher sanctions, as well as speedier punishment. Previously, higher penalties — such as last month’s £3.3 million ($4.2 million) fine on Thames Water Ltd. for a sewage spill in a river near Gatwick Airport — could only be levied through criminal court proceedings.
“This is a highly speculative claim with no merit which we strongly refute,” a spokesperson from Severn Trent said. “Should pollutions ever occur, they are always reported to the Environment Agency. Any claim to the contrary is wholly and completely wrong.”
The claim will allege that the water company broke competition law by misleading regulators Ofwat and the Environment Agency over the number of discharges or spills of untreated sewage into rivers, lakes and coastal areas.
“Customers put their trust in water companies, believing that they are correctly reporting these spillages and appropriately treating the sewage so it can safely be returned to the environment,” said Zoe Mernick-Levene, a lawyer at Leigh Day. “Instead, our client believes they are misleading their regulators and customers are overpaying while England’s waterways are suffering as a result.”
The UK’s opt-out class action regime, known as collective proceedings, has gained traction since 2021. No claims were allowed to go ahead in the five years the process came into effect in 2015, but in 2021 the first suits were given the green light. There are several pending claims including against Big Tech companies and manufacturing firms for competition abuses at the Competition Appeal Tribunal.
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