Infighting among the shareholder groups bringing a combined £4bn claim against the Royal Bank of Scotland (RBS) has reached a climax with the largest group understood to be in talks to sue Lloyds Bank and Investec over non-payment of fees, The Lawyer has learned.

The RBS Shareholders Action Group is understood to have approached a number of law firms to bring a claim alleging the institutional investors, which have splintered off from the group, did not pay full contributions.

The Lloyds Bank institutional investors, including claimants such as Scottish Widows and Halifax Life, left the principal claimant group for Mishcon de Reya in October.

Investec followed several weeks later, also turning to Mishcon partner Richard Leedham on its claim against the bank.

Following a board meeting on Friday (27 November) the action group has mooted moving ahead with plans to bring legal action against the two investors, The Lawyer understands.

One source close to the litigation called the news a “distraction” from the main event.

The Lloyds and Investec exits also cut the value of the RBS Shareholders Action Group claim by around 20 per cent, though the group still has more than 35,000 mostly individual investors on board.

Following Mishcon coming on the record in the claim a number of sources close to the litigation said that other firms, including Fladgate and an unnamed US player, had been approaching Signature’s claimants to launch further splinter groups.

Costs and funding have already proved key in this trial, which has been adjourned until 2017 following problems with RBS’s mammoth disclosure exercise, which it told the court was delaying its lawyers Herbert Smith Freehills (HSF) from preparing witness evidence.

Last week Mr Justice Hildyard criticised the bank and HSF for their “unfocused”, “unsettling” and “less than compelling” approach to disclosure, which requires the bank to review around 25 million documents.

The Mishcon claimant group is privately funded whereas Signature has a third-party litigation funder putting up a pot for the claimants.

The Lawyer revealed earlier this year HSF’s bill up until the end of a trial on quantum would hit £90m.

The Mishcon and Signature groups are two of a total five claimant groups bringing legal action against RBS, alleging the bank’s £12bn rights issue in 2008 was defective and contained “material misstatements and omissions”.

Stewarts Law, Leon Kaye and Quinn Emanuel Urquhart & Sullivan represent the other claimant groups. 

Signature came on the record for the principal claimant group this summer following a disagreement over funds with its previous counsel Fladgate. The swap marked the second in this case, with the group previously turning to Bird & Bird.

A spokesperson for the RBS Shareholders Action Group said in a statement: ”The board is considering when and how to seek recovery of what is due from former members, but has not determined to commence proceedings at this point and has not instructed any law firm to commence such proceedings.” 

Signature Litigation, Mishcon de Reya, Lloyds Bank and Investec declined to comment. 

The legal line-up

For claimants, the Royal Bank of Scotland Shareholders Action group

3 Verulam Buildings’ Jonathan Nash QC, Peter de Vernueil Smith and Ian Higgins, instructed by Signature Litigation partner Graham Huntley

For claimants, the Stewarts Law group

3 Verulam Buildings’ Andrew Onslow QC, Adam Kramer and Scott Ralston, instructed by Stewarts Law partners Clive Zietman, Keith Thomas and Fiona Gillett

For the claimants, the Leon Kaye group

3 Verulam Buildings’ Michael Lazarus, instructed by Leon Kaye partner Leon Kaye 

For the claimants, the Quinn Emanuel Urquhart & Sullivan group

One Essex Court’s Laurence Rabinowitz QC, Erskine Chambers’ Alex Barden andOne Essex Court’s Maximillian Schlote, instructed by Quinn Emanuel partners Sue Prevezer QC and Martin Davies

For the claimants, the Mishcon de Reya group

Mishcon partner Richard Leedham. Counsel is not yet known.

For the defendants, RBS 

Fountain Court’s David Railton QC and James McClelland, Serle Court’s David Blayney QC and Simon Hattan, 3 Verulam Buildings’ Sonia Tolaney QC, instructed by Herbert Smith Freehills partners Simon Clarke, Adam Johnson and Kirsten Massey. 7KBW’s Jonathan Gaisman QC, previously lead counsel, has come off the case