MILLIONS of billpayers could get compensation from a new legal claim.
A case has been launched alleging that one of the UK's largest water firms overcharged customers.
A legal claim led by professor Carolyn Roberts, an environmental and water consultant, alleges that Seven Trent under-reported pollution incidents and ended up charging more as a result.
Leigh Day, the law firm representing the professor, claims the water firms eight million customers are owed £330million compensation.
The number of pollution incidents a company reports to the regulator is an important factor in determining the price water companies can ultimately charge for their services.
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Professor Roberts argues that if the water companies had correctly reported the number of pollution incidents, performance penalties would have been applied.
This would have reduced how much customers were charged, she says.
Zoë Mernick-Levene, partner at law firm Leigh Day, said: "Not only is compensation being sought for millions of customers who have, and continue to, pay higher water bills, but we hope that it will also send a message to water companies that they cannot unlawfully pollute waterways and mislead their regulators without consequence.
"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."
The case is being brought as a collective action, similar to class action lawsuits in the US.
Collective actions like this have the power to make a case for compensation on behalf of millions of consumers together, instead of each individual having to make a claim.
It means anyone affected - in this case Severn Trent customers - are automatically part of the case, and any compensation.
Leigh Day has filed the action at the Competition Appeal Tribunal, but any compensation is still a long way off as legal cases often take years.
A Severn Trent spokesperson said: "This is a highly speculative claim with no merit which we strongly refute.
"Should pollutions ever occur, they are always reported to the Environment Agency. Any claim to the contrary is wholly and completely wrong.
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"Our regulators, the Environment Agency and Ofwat, set strict targets and performance measures that deliver for our customers and the environment.
"Severn Trent is recognised as a sector leader by both regulators across operational and environmental measures.
"We consistently deliver for our customers, and recently received the highest 4 star status for environmental performance from the Environment Agency for the fourth year running."
Professor Roberts and the law firm said they intend to launch further claims against other water firms over the same issues.
It says action against six firms could affect 20million customers in total leading to compensation of £800million if successful.
What are class action lawsuits?
Lawsuits that result in compensation for many people are often referred to as "class action".
In England and Wales a Group Litigation Order (GLO) is often used for this kind of lawsuit.
Collective action has been made easier under the UK's Consumer Rights Act 2015.
It means the courts can treat similar claims as one, rather than having hundreds or even thousands of separate individual claims.
There are a number of stages to bringing this kind of lawsuit, including the courts needing to give permission for a GLO.
Both sides can also appeal decisions at various stages making it a lengthy process with no guarantee of a payout.
Collective actions are rare - there have only been around 100 cases since 2000 according to the HM Courts and Tribunals Service.
The Mastercard case was the first of these big claims since the changes in 2015 and is the furthest along - but it first launched in 2017 and is still in the courts.
Lawyers have urged Brits to join several other collective claims for compensation in recent years.
There is no cost to sign up, but the firm will usually take a cut of any payout if the claim is successful to cover legal costs and that can be as much as 30%.
There's no guarantee of a payout and collective claims of this type have not yet been fully tested in court.
None have yet been given permission to go ahead as a collective action apart form the Mastercard claim.
Millions of Easyjet customers who had their personal details stolen in a data breach could make a claim for compensation.
British Airways, Virgin Media, and Equifax are also the subject of collective claims after data breaches.