[2025] EWHC 2307 (KB)

The extent of the relevance of the first CMH and, in particular, the costs incurred in Tranche 2, runs throughout this judgment. The defendants’ submissions sought to uphold the rationale and outcome of the decisions made there. The claimants’ submissions sought to demonstrate that they had taken on board the criticisms largely aimed at their budgets when submitting budgets for this second CMH. The extent to which those efforts were successful is at the heart of this decision.

Readers of this judgment are referred to the first CMH judgment ([2024] EWHC 1728 (KB)) for the background to this litigation including the terminology and acronyms as well as the general principles of costs budgeting which are set out in detail. It is sufficient for the purposes of this judgment simply to describe the elements of these proceedings which are currently being budgeted and how they fit in with the proceedings overall.

The amalgamation of existing and intended Group Litigation Orders in respect of NOx Emissions for the purposes of active case management began at the end of 2023. There have been a number of formal interlocutory and case management hearings thereafter as well as “Fortnightly Meetings” which were intended to deal with any minor procedural issues in a speedy fashion and maximise the chances of the critical path to trial being achieved.

The first trial of issues (“the KBA Issues”) (“Tranche 1”) took place in October 2024. The second trial, concerning “Prohibited Defeat Devices” (“PDD”) (“Tranche 2”), is due to begin in October 2025. Those Tranches of this litigation were dealt with in the first CMH decision together with “General” costs incurred outside of the Tranches themselves.

Directions for the third Tranche concerning causation and loss were given in March 2024 and the “Quantum Trial”, as it is described, is due to take place in October and November 2026. It is the costs for this Tranche (“Tranche 3”) along with the second period of general costs (“Second General”) between Spring 2026 and the Quantum Trial which are the subject of this decision.

The Lead GLO involves claims against Mercedes. Additional Lead GLOs (“ALGLOs”) involve Ford, Peugeot / Citroën and Nissan / Renault. Claims against other manufacturers are described as Non-ALGLOs. The participation of the Non-ALGLOs in the PDD Trial and the Quantum Trial has been limited by the case management directions. Consequently, there is a distinction to be drawn in terms of the costs for and against the Non-ALGLOs when compared with the Lead and ALGLO defendants. This delineation in participation also explains why the claimants have set out their budgets to distinguish (i) “Pan NOx” work involving all, or potentially all of the GLOs; (ii) Lead and ALGLO work; and (iii) GLO specific work.

By contrast, the defendants do not separate out any Pan NOx or Lead and ALGLO costs and so their budgets simply reflect the work for each defendant entity. Nevertheless, their status as Lead, ALGLO or Non-ALGLO defendant has clearly affected the sums claimed in various phases by the defendants to reflect the extent of their participation in the Quantum Trial.

There are, as the claimants’ skeleton argument described it, “slightly fewer” budgets and phases to work through on this occasion. There are in fact 63 budgets: about half relate to Tranche 3 which comprise 10 phases and about half relate to the Second General budgets which comprise three phases. As such there are 390 costed phases compared with the 1,071 phases referred to in the first CMH judgment. Unsurprisingly, therefore the sums claimed are lower than in the first budgeting exercise but nevertheless they still amount to £55,731,549.35 (Cs); £75,779,828.07 (collectively for Ds) for Tranche 3 and £19,776,700.50 (Cs)/ and £3,557,144.35 (collectively for Ds) for the Second General budgets.

As with the first CMH, we pay tribute to the “fleet” of counsel representing the numerous parties and who managed to make their submissions in a sufficiently streamlined way to deal with all of the phases in the allotted two days of court time.