Litigation funders beware — Excalibur v Gulf Keystone
By Harvey Rands
In a scathing judgment on the claimant’s conduct of the Excalibur v Gulf Keystone litigation, the Commercial Court has given a stern warning to those who fund litigation for profit and the lawyers who advise them. The defendants were awarded indemnity costs. Excalibur was ordered to pay further sums of £3.2m to Gulf and £2.4m to co-defendant Texas Keystone as security for costs, on top of £10.7m and £6.8m, respectively, previously provided by Excalibur’s funders. Proceedings will be also pursued against the litigation funders, and in one case against the individual behind the Cayman Islands vehicle used to provide the funding.
It has been well recognised since the train-crash trial of Three Rivers District Council v The Governor & Company of the Bank of England that indemnity costs will be awarded against an unsuccessful party whose claim or conduct is a departure from the norm. It is an increasingly common feature of commercial litigation in London that speculative, opportunist and weak claims of massive size are brought by impecunious claimants, backed by litigation funders and after-the-event insurance, with the intention of bullying a defendant into settlement to avoid years of litigation and millions of pounds of costs.
This judgment is unlikely to turn the tide, but might bring some moderation to the current appetite for excess…
If you are registered and logged in to the site, click on the link below to read the rest of the Memery Crystal briefing. If not, please register or sign in with your details below.
Sign in or Register to continue reading this article
It's quick, easy and free!
It takes just 5 minutes to register. Answer a few simple questions and once completed you’ll have instant access.Register now
Why register to The Lawyer
In-depth, expert analysis into the stories behind the headlines from our leading team of journalists.
Identify the major players and business opportunities within a particular region through our series of free, special reports.
Receive your pick of The Lawyer's daily and weekly email newsletters, tailored by practice area, region and job function.
More relevant to you
To continue providing the best analysis, insight and news across the legal market we are collecting some information about who you are, what you do and where you work to improve The Lawyer and make it more relevant to you.
News from Memery Crystal
News from The Lawyer
Briefings from Memery Crystal
Memery Crystal’s Tim Crosley and Naomi Lawton give their views on the 2014 Autumn Statement and the Draft Finance Bill 2015 clauses for PLCs
12 festive tips to help minimise any risks before, during and after the office Christmas party and provide a safe (and fun) environment for employees.
Analysis from The Lawyer
Commercial court waiting times are rising to new levels says the Lord Chief Justice