20 January 2014 | By Katy Dowell
6 January 2014
23 October 2013
8 November 2013
24 October 2013
30 July 2014
While litigators look forward to a vintage year in court, we look back at what happened in the top cases of last year
Only the most fiercely fought cases are heard by the High Court with many more litigants looking for a settlement to avoid the potential embarrassment and cost of court. Of The Lawyer’s Top 20 Cases for 2013, eight settled and seven went onto fight. The remaining six are ongoing, either awaiting judgment or have been pushed into 2014.
The City is still awaiting the substantive hearing in the Libor manipulation case, Graisley Holdings v Barclays Bank. Originally scheduled to be heard over 30 days in October 2013, this battle, which has seen several changes in its legal lineup, is now set down for April.
In November last year, Barclays went to the Court of Appeal (CoA) in a second bid to have Libor-related fraudulent misrepresentation claims against it dismissed ahead of the full trial.
Clifford Chance partner Ian Moulding turned to South Square’s Robin Dicker QC for Barclays, who argued that the claims amounted to an “obligation to disclose one’s own dishonesty”, which was a cause of action unknown to English law.
Graisley, the corporate vehicle behind Guardian Care Homes, was to be represented by Cooke Young & Keidan for the last time at the CoA, despite the firm leading its fight against the bank for more than two years (6 December 2013). But no David and Goliath battle is going to be cheap and with that in mind Graisley drafted in the Wilkes Partnership, citing financial concerns.
There has also been a change to the counsel team. Wilkes partner Andrew Garland has instructed Guildhall Chambers silk Stephen Davies QC and Neil Levy to run the case in place of One Essex Court’s Stephen Auld QC and Outer Temple Chambers’ Farhaz Khan and Simon Oakes.
The fallout from the 2012 administration of Rangers FC continues to reverberate. The liquidators’ case against Collyer Bristow had been expedited, meaning that 3 Verulam Buildings’ Cyril Kinsky QC was double-booked and unable to appear in the case. Further delays, however, meant that he maintained the instruction from Clyde & Co partner Richard Harrison along with Wilberforce Chambers’ Ian Croxford QC.
A case management conference is scheduled for 14 February, when the court will revisit disclosure matters. A full trial is scheduled for January 2015.
Those cases that have gone onto fight have done so in fierce style.
Clydes partners Michael Payton and Jon Turnbull defeated DAC Beachcroft partners Simon Pearl, Kenneth McKenzie, Alison McAdams in the High Court in a $200m (£124m) insurance battle.
The case, AstraZeneca Insurance Company Ltd v XL Insurance (Bermuda) Ltd and Ace Bermuda Insurance Ltd, examined whether the defendants could be held liable for settlements and costs incurred by US pharma company AstraZeneca, which settled 28,000 claims in the US relating to prescription drug Seroquel.
Mr Justice Flaux resolved two preliminary issues in favour of XL Bermuda and Ace Bermuda in his ruling last February (28 February 2013). He held that the policy provided cover for settlements only where Astrazeneca could show that it was or would have been liable for the claims, and that the policy, on its proper construction, equally provided cover for defence costs only in circumstances where AstraZeneca was or would have been held liable.
The CoA unanimously upheld the ruling in December (20 December 2013) and permission to appeal to the Supreme Court was refused.
In May the High Court threw out an attempt to force the Northern Rock to pay compensation to shareholders who lost out when the bank was nationalised in 2008 (9 May 2013). The ruling was a victory for Brick Court Chambers’ Mark Howard QC, Martin Chamberlain QC and Jonathan Dawid, who were instructed by Mayer Brown partner Stuart Pickford for the defendant.
Also in May, Pinsent Masons won a major trademark dispute for Interflora against Marks & Spencer (M&S). The ruling (21 May 2013) brought to an end a case that began in 2008 and centred on trademarked keywords and phrases in Google AdWords.
The case was referred to the European Court of Justice in 2009 by Mr Justice Arnold to determine whether the use of a trademarked term as a keyword constitutes ’use in trade’, and therefore trademark infringement according to EU law. At issue was whether M&S had infringed Interflora’s trademark when it purchased several of the florist’s trademarked keywords and phrases in Google AdWords.
Ups and downs
For former Devereux Chambers head Ingrid Simler QC, 2013 was a transformative year that saw her appointed to the High Court bench. That came after she lost a judicial review bid for UK Uncut Legal Action, which had attempted to examine the relationship between Goldman Sachs and HM Revenue & Customs (HMRC).
UK Uncut asserted that HMRC breached its public law duties when it failed to comply with its own collection and management duties after it agreed to a £10m settlement with the banking giant over national insurance contributions and interest obligations. The relationship between the two, UK Uncut claimed, was too close. Despite dismissing the case in his ruling Mr Justice Nicol stated: “The settlement with Goldman Sachs was not a glorious episode in the history of the Revenue.”
There was a huge blow for the court-appointed trustee seeking to recover more than $15.5bn for victims of Bernie Madoff’s fraud in New York. In October Mr Justice Popplewell threw out a series of claims against 11 defendants in London, including Madoff’s sons Mark, who killed himself in 2010, and Andrew, who has cancer.
The case, which was brought by Grant Thornton and was valued at more than £75m, asked the court to examine the relationship between the New York operations and UK-incorporated Madoff Securities International Ltd (MSIL). The claimants alleged multiple breaches of directors’ duties, which included claims of conscious dishonesty.
Dismissing the case, Popplewell J said the defendants had been poorly treated and Grant Thornton had issued an “unfounded claim”. Defendant Sonja Kohn, founder of Bank Medici, was labelled Madoff’s “criminal soulmate” by the court-appointed trustee Irving H Picard, but, in London Popplewell J said she had been the victim of a “poisonous press release”. There was no case for her to answer.
RBS, meanwhile, was successful in its defence of a claim being pursued against it by Torre Asset Funding. The ruling (3 September 2013), delivered by Mr Justice Sales, clarified the scope of an agent’s duties in a finance transaction.
Settlements were reached in a number of cases.
In January last year, former Liverpool FC owners Tom Hicks and George Gillett withdrew a raft of claims against the club’s former directors who had forced the pair to relinquish control of the club.
The case exploded in 2010 when Hicks and Gillett had attempted to block the club’s £300m sale to New England Sports Ventures. At the time, the pair had attempted to reconstitute the club’s board and sack former chairman Martin Broughton, managing director Christian Purslow and commercial director Ian Ayre. The sale went ahead, but then the US duo instructed Clyde & Co partner Paul Friedman to pursue claims that Broughton, Purslow and Ayre had conspired with RBS to sell the club at a reduced rate.
The case was scheduled for a 50-day outing in April, involving six silks in total, with 3 Verulam Buildings’ Ali Malek QC and Gregory Mitchell QC and 4 Stone Buildings’ Richard Hill QC all instructed for the claimants. The terms of the settlement were not disclosed.
Another mammoth trial that went on to settle was the £100m case pursued by GDF Suez and GdF International. The pair had claimed that the defendants, Teesside Power Holdings, Western Power Investments, South Wales TPL Investments, Cargill Financial Markets and ELQ owed more than £100m for breach of warranties in relation to the sale of a UK power station in 2008.
While the terms of the settlement are confidential, it was a successful year for the defendants’ solicitor. Ashurst partner Ben Tidswell beat off competition from within his firm to secure the chairmanship role.
The multimillion-pound dispute between Britain’s richest man Lakshmi Mittal, CEO of ArcelorMittal, and rival Manmohan Varma was resolved behind closed doors just hours before their case was to kick off in the High Court in March.
The tycoons had been thrashing it out for years, with the battle promising to give an insight into the wealthy elite of Anglo-Indian society. Rice importer Varma, instructing RPC partner Tim Brown and 4-5 Gray’s Inn’s Robert Griffiths QC, claimed that Mittal, represented by Peters & Peters partner Jonathan Tickner and 3 Verulam Buildings’ Paul Lowenstein QC, had promised him a commission while the pair were in Mittal’s private jet.
In June, the long-running battle to secure compensation for the Kenyans tortured by British colonial forces during the Mau Mau uprising reached settlement with the Foreign & Commonwealth Office paying out £20m.
The deal brought to an end a long legal battle fought by Leigh Day, which included a previous attempt by the Government to have the claims struck out on the ground that they were out of time.
Also avoiding a court outing were three major banks, Merrill Lynch International, UBS and Italy’s Dexia Crediop, which had intended to sue the Italian city of Florence over interest rate swap transactions. This case involved six Fountain Court barristers, including David Railton QC, Richard Handyside QC and Patricia Robertson QC.
In September, Freshfields Bruckhaus Deringer and legacy Herbert Smith avoided a £140m court showdown with London Underground Ltd (LUL) after settling a professional negligence case just weeks before it was due to be heard. The case, thought to be among the largest ever filed against a City firm, was due to be heard over four weeks in October with LUL bringing in Ince & Co partner Charlotte Davies and Justin Fenwick QC of 4 New Square to lead the battle.
October brought to an end the long running battle between disgraced former Metropolitan Police commander Ali Dizaei and the Met Police. The 40-day race discrimination and victimisation claim had threatened to put conduct of the higher ranks of the Metropolitan Police Service (MPS) under the court’s spotlight.
The case would have pitted 11KBW’s Clive Sheldon QC , for Dizaei, against Matrix Chambers’ Tom Linden QC. It was revealed in early October that the force had contributed towards Dizaei’s legal fees in order to avoid what it called “costly litigation”.
The High Court had expected to hear its first major employment case in 2013, but alas, it was not to be. The case pitched Swiss interdealer broker ContiCap against GFI Holdings, and concerned employees poached in another jurisdiction. The contracts of employment were governed by Swiss law, as was the claim itself, yet the case is being heard in London.
Rosenblatt partner Laura Clatworthy, instructed 11KBW’s Daniel Oudkerk QC to lead the case. Oudkerk has since upped sticks for Essex Court Chambers.
A number of disputes are ongoing or awaiting judgment from the court.
The High Court was expected to hear a major dispute between Nokia and HTC and IPCom in 2013. The two defendants before the European Patent Office have adjourned the High Court case pending the outcome of an appeal.
It will be interesting to hear the outcome of Deloitte’s appeal after the Financial Reporting Council fined it a record-breaking £14m in September for failing to manage conflicts of interest. The decision came on the back of a public tribunal in March, which examined Deloitte and one of its former partners, Maghsoud Einollahi. In question was the role he played advising the ‘Phoenix Four’ directors while acting as administrator to collapsed carmaker MG Rover Group.
The hotly-anticipated trial saw Fountain Court’s Tim Dutton QC appear for claimant AADB and go head-to-head with 4 New Square’s Sue Carr QC, marking one of the last cases Carr worked on before she was appointed to the High Court bench in May.
Barclays, meanwhile, is awaiting judgment in a €150m (£125m) case brought against it by CF Partners, a UK advisory and trading firm. RPC partners Tom Hibbert and Andrew McGregor instructed Brick Court’s Tim Lord QC for the claimant, while Barclays turned to 3 Verulam Buildings’ Ewan McQuater QC, who was instructed by Freshfields partners Simon Orton and Richard Chalk.
This year will also see the High Court produce judgment in the Formula One (F1) bribery battle. This case, heard in October, saw F1 chief Bernie Ecclestone refute claims he made corrupt payments to facilitate the sale of F1. Ecclestone insisted that he paid a German banker £10m because he was threatened over his tax affairs.
2013 was an outstanding year for litigators and The Lawyer’s Top Cases of 2014 shows that the trend is continuing. This year is set to be one of high-value battles as London’s courts continue to attract big-money litigants.