High Profile Litigation Cases

by Vannin Capital on March 18, 2014

Over the past two years London has been establishing its place as the location of choice for the resolution of high profile commercial cases. The High Court here has been the arbitrator of a wide range of commercial disputes, ranging from private client disputes, and including big-ticket commercial claims. Banking cases are unsurprisingly prominent, bearing in mind the many scandals and disputes, such as PPI mis-selling. Equally unsurprising has been the high profile names of some of the private clients.

Typical was the case of Constantin Medien v.  Formula 1 tycoon, Bernie Ecclestone which went to court between October 2013 and January 2014. With its roots in Germany industry and a nine year history, the case involved £27 million bribe charges, a family trust, and bank losses of $400 million. Essentially, Ecclestone was defending claims of bribery and corruption, arguing that money paid was not bribes but paid under the threat that he would be exposed to the UK tax authorities over bogus deals and company under-valuation. The claim failed.

Another high profile case of 2013 involved one of Britain’s wealthiest men, Lashmi Mittal, the steel magnate, defending the claim of his former associate Manmohan Varma. Varma’s claim was for non- payment by Mittal of commission for deals.  This dispute involved sums running to multimillion pounds..

Another high value claim due to come to court in 2014 is that brought by London Underground and for £140 million pounds. This one interestingly is against their former high profile commercial lawyers, Freshfields and Herbert Smith. Like so many of these heavyweight, complex commercial cases, it has been a long-running dispute and dates back to advice given in 2003 when London Underground was involved in public/private partnership deal negotiations with collapsed transport company Metronet.

Such has the plethora of high profile banking cases, only a few can be highlighted here. The 2012 case of Deutsche Bank and Sebastian Holdings is worthy of mention because of the staggeringly high sums involved. Deutsche Bank’s claim for $245 million was for unpaid margin calls by Sebastian, an investment company. To add to the complexity and high financial stakes involved in this high profile case, was the fact that Sebastian counter-claimed for $7 billion.

RBS has struggled to maintain both a healthy reputation and profits’ sheet in recent years. Equally challenging have been the large number of legal disputes that have seen them involved in. These have included Libor mis-selling, PPI mis-selling and the yet to be resolved claims cases brought by their own shareholders. Cases involving Barclays have commanded an equally high profile; it was fined £290 million in June 2012 for manipulating global, benchmark borrowing rates.

Obviously these high cost commercial litigation cases keep the focus on the London High Court, and maintain the profile set by the case of Beresovsky v. Abramovich, the latter successfully defeating Beresovsky’s £5 billion claim. That case allegedly cost £140 million in legal fees. Funding of these high level commercial cases is eye-wateringly expensive. Little wonder that it is often only billionaire business tycoons who can afford to litigate as individuals. Even in these moneyed circles there have been rumours of flexible billing.( These link to recent reforms that followed the Jackson report which gave the green light to third party funding.) Beresovsky was supposedly the beneficiary of a complex funding agreement. In Varma v. Mittal the latter had the help of a CFA. The funding of high profile litigation can be as complex as the commercial litigation itself. For both the costs and risks are colossal.

This article was written on behalf of Vannin Capital. Visit their website to learn more about Commercial Litigation.

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