A lawyer from Pinsent Masons, a former Stewarts Law partner and a former DLA Piper partner have been appointed to the board of the RBS Shareholders Action Group, which is embroiled in a £4bn legal battle with the Scottish bank.
Insiders at the group said they were “frustrated” by the appointments, which they say sees control of the headline challenge fall into the hands of non-shareholders.
Pinsent Masons’ head of strategic development for pensions and former partner Robin Ellison has been named chairman of the action group’s board of directors.
Douglas Stewart, who founded Stewarts Law and is now president of law firm network Legallink, has been appointed vice chairman, while former DLA Piper partner Charles Gordon, who left in 2014 to join Jams International as a mediator, has been named group litigation director.
The action group is represented by Signature Litigation partner Graham Huntley, having changed its lawyers a number of times in the last 18 months.
It is one of five claimant groups engaged in a joint lawsuit against the Royal Bank of Scotland (RBS) over its £12bn 2008 rights issue, which allegedly contained “material misstatements and omissions”.
The other groups are represented by Stewarts Law, Leon Kaye, Quinn Emanuel Urquhart & Sullivan and Mishcon de Reya.
A statement by action group chief executive Lorena Aguirre said the new appointments would “serve our members in good stead throughout the remainder of the litigation. I also anticipate that the renowned mediation and negotiation skills they bring will be very useful to us in the coming year.
“Similarly Charles Gordon is somebody who I believe will be a huge help in helping us work with our lawyers Signature Litigation,” Aguirre continued.
The mammoth case will hit the High Court in March 2017. It was previously listed to be heard this autumn but was adjourned following an application by RBS that claimed the disclosure process so far had “vastly exceeded all expectations in terms of scale and the amount of time and resource required”.
Disquiet over the RBS Shareholders Action Group board appointments is the latest in a series of squabbles among the group, after a number of the institutional investors left to form a new group represented by Mishcon de Reya late last year.
The principal group subsequently considered suing the institutional investors, which included Lloyds Bank investors, Investec and Scottish Widows, over non-payment of fees.
The exits 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.
RBS’s legal battle with its shareholders is expected to be one of the biggest banking disputes in the aftermath of the financial crisis. The bank’s lawyers, Herbert Smith Freehills, told the court last year that its fees up until a trial on quantum would top a colossal £90m.
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
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
For the claimants, the Mishcon de Reya group
20 Essex Street’s Luke Pearce, instructed by Mishcon partner Richard Leedham
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