GERMANY Trends and Developments Contributed by: Johanna Wirth, Maximilian Bülau, Philipp Hanfland and Carsten van de Sande, Hengeler Mueller
around EU Regulation 261/2004, which entitles pas- sengers to compensation for flight delays and cancel- lations. Similarly, wenigermiete.de tackled violations of Germany’s rent control laws ( Mietpreisbremse ), enabling tenants to reclaim illegally charged above- market rent. More recently, the range of claim types has expanded further. Legal tech companies now offer no-win-no- fee arrangements for, among other things, the recov- ery of losses from illegal online gambling activities and disputes related to energy supply contracts. Data pro- tection claims – particularly those arising from mass data breaches, such as the Facebook “scraping” case – have also become a major growth area of automat- ed claims. The business model of highly automated, financed claims administration has meanwhile been copied around the world. And defendants and courts adopt it as well. Airlines and their legal partners have built systems that automatically compute the validity of incoming claims against flight data, and enable a largely automated response or defence. The German judiciary has begun experimenting with AI as well. While most of the technologies employed to date are still assistive (rather than generative), Germany may be regarded as a pioneer when it comes to the practi- cal application of technology in litigation. ESG and Climate Litigation ESG-related claims have been gaining momentum in Germany and across Europe. In the aftermath of the ruling of the District Court of The Hague in 2021, ordering Shell to reduce its total CO₂ emissions, a number of similar claims have been filed in Germany. While most of these claims against, for example, car- makers, have largely been unsuccessful, a ruling of the Higher Regional Court of Hamm on 28 May 2025 stands out. In that case, a Peruvian farmer had filed a complaint against energy giant RWE, alleging that climate change resulted in a high risk of his property being flooded, and that RWE should contribute to the costs equivalent to its share of CO₂ emissions. Although the court ultimately dismissed the claim, it made significant statements of principle: large emit- ters such as RWE can, in principle, be held liable for the consequences of climate change – even if they have complied with all applicable German legislation.
Whether the assessment of the Higher Regional Court of Hamm will stand the test of time is doubtful. The Federal Court, in March 2026, denied private enforce- ment actions brought against BMW and Mercedes, seeking to ban the sale of combustion engines as of 2030. However, the reasoning was case-specific and does not necessarily put an end to claims such as the one brought against RWE. Until a more comprehensive determination by the German Federal Court is issued, we are likely to see further high-profile ESG lawsuits. Notably, counsel for the plaintiff in the case against RWE has already filed further actions against German companies – this time on behalf of Pakistani farmers. Litigation Funding The German litigation funding market has expanded rapidly both in terms of the number of funded cases as well as the size of funding budgets. International funders such as Burford Capital, OmniBridgeway, Deminor, and Nivalion have entered into or expanded their operations in Germany, alongside established domestic players like Foris and Legial. As of 2024, more than 40 litigation funders were operating in Ger- many, covering a wide spectrum of claim values and dispute types. One particularly active field of litigation funding is mass claims. Most consumer mass claims in Germany are now externally financed, underscoring the extent to which litigation funding has become embedded in this segment of the legal market. Yet, it is particularly this field of activity which is most contested. A funding cap at 10% of the proceeds in representative actions has rendered funding virtually unviable. And the model of assigning claims to a funded SPV is still being chal- lenged in court for incompliance with the Legal Ser- vices Act. The Federal Court of Justice is expected to render a potentially pivotal decision on the extent to which mass claim funding is admissible in 2026. Sanctions-Related Disputes The Russian war against Ukraine has led to signifi- cant disruptions in international dispute resolution, not least in Germany. Many European and German companies have initiated or contemplated arbitration proceedings against Russian counterparts for, eg,
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