Cooke Young & Keidan acts as first Libor litigation hits court

Cooke Young & Keidan took a lead role as Barclays yesterday faced court action relating to the alleged mis-selling of complex derivatives.

Partner Philip Young instructed counsel Tim Lord QC of Brick Court Chambers on behalf of care home provider Guardian Care Homes, which is pursuing allegations of interest rate swap mis-selling and Libor fixing against the bank. The care home group accused the bank of selling it derivative products that were highly unlikely of offering protection against rising interest rates.

Partners Susannah Sheppard and Vincent Smith of Sheppard & Smith are also involved in the case, which is seen as an important test case for thousands of other businesses that could have been mis-sold products by the banks.

Barclays was represented by Matthew Arnold & Baldwin partner Clare Stothard, who instructed Adrian Beltrami QC of 3VB.

At the hearing at Birmingham Mercantile Court, Judge Simon Brown QC said it would be “wholly wrong” for the case to be transferred to the FSA redress scheme (2 July 2012).

Barclays had applied for the case to be deferred.

Brown J said: “We just do not know if the scheme will include the claimants […] some cases need to be litigated and I have a duty to decide which.”

Barclays now has to file its defence by 10 August, meaning Libor allegations will be heard before the High Court.

The bank was ordered to pay Guardian Care Homes’ legal costs relating to yesterday’s hearings.

Cooke Young & Keidan is one of a number of firms instructed by businesses taking action against banks (30 July 2012).