BRAZIL Law and Practice Contributed by: João Areosa, Guilherme Peres de Oliveira and Raphael Rangel, Areosa Advogados
Individual homogeneous rights Execution occurs in two distinct phases:
Diffuse and collective rights: • If plaintiff wins – judgment binds erga omnes (eve- ryone) nationwide, preventing relitigation. • If plaintiff loses – judgment binds erga omnes only if dismissal is on the merits with sufficient evi- dence. New actions arising from same facts are precluded. • If dismissed for insufficient evidence – no res judi- cata effect; another legitimate entity may refile with new evidence. Individual homogeneous rights: • If plaintiff wins – judgment binds erga omnes (all class members can liquidate individual damages). • If plaintiff loses – no binding effect on individual class members (secundum eventum litis rule). Indi- viduals may still pursue separate lawsuits for their own damages. • Individual class members who filed their own law- suits before collective judgment may opt out and proceed independently. The secundum eventum litis doctrine protects individ- ual rights – unfavourable collective judgments do not prevent individuals from seeking justice, while favour- able judgments benefit all class members. The most distinctive feature of Brazilian collective actions is the variable res judicata regime depending on the type of collective right involved, as established in Article 103 of the CDC. Enforcement of Collective Judgments Diffuse and collective rights Execution is collective – orders are enforced against defendants to benefit entire groups. Environmental restoration benefits everyone in the affected area. Injunctive orders protect all affected persons. Mon- etary awards go to fluid recovery funds if not specifi- cally allocated to identified victims. The legitimate entity that brought the action typically supervises execution, ensuring compliance with the judgment and pursuing enforcement if defendants fail to comply voluntarily.
• Phase 1: Collective judgment establishing liabil- ity: The judgment determines the defendant’s liabil- ity and establishes general criteria for calculating individual damages. It does not quantify specific amounts for each victim but creates the framework for individual quantification. • Phase 2: Individual liquidation and enforcement: Individual victims may file individual execution proceedings ( liquidação e execução individual ) to quantify their specific damages using the criteria established in the judgment; prove their individual losses and circumstances; and collect their individ- ual awards from the defendant. This process allows individualised recovery while avoiding the need to relitigate liability, which the collective judgment established definitively. Collective enforcement option If individual victims do not seek enforcement within one year after the judgment becomes final or after the publication notifying them of their rights (which- ever occurs later), authorised entities (particularly the Public Prosecutor) may initiate collective enforcement to recover global damages for distribution to victims who come forward. This collective execution uses procedures similar to class distribution in US settlements, with claims administration and distribution to eligible claimants. Fluid recovery Unclaimed amounts after a reasonable time for victims to come forward are deposited in fluid recovery funds for projects benefiting the affected community or simi- lar collective interests; for example, unclaimed con- sumer damages fund consumer education, unclaimed competition damages fund market regulation and unclaimed environmental damages fund conservation. This mechanism ensures defendants do not benefit from violations merely because individual victims fail to claim compensation.
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