As you may be aware from recent press reports, the Bank has made an increased and improved settlement offer which the Board of the Action Group has decided to accept. We have sent a written update to the retail membership setting out the reasons for that decision, and we set out here some practical points which we hope are of assistance:
- As and when the settlement is formally agreed, this will be signed by the Directors of the Action Group on behalf of the retail membership.
- As part of the settlement process, we will need to verify the number of Rights Issue shares being claimed for. We will take responsibility for verifying the shares held by the retail members, together with our solicitors. We anticipate being able to carry out that exercise on the information we have available, but if we do need further information from you we will be in touch.
- We, and our solicitors, will arrange for the settlement sums to be distributed to members in one or more tranches as and when the verification process has completed and settlement sum are received from the Bank, over the course of the next few months.
If you have any questions, please contact the Action Group in the usual way.
Judgement from a hearing on the 9th March 2017 (Click here to view)
The Court has directed us to make available on the Group's website a copy of its judgment of 9 March 2017, and to draw members' attention to the particular paragraphs set out below. This is to ensure that members of the Group are fully aware of their potential liability for adverse costs, and of the up to date position concerning funding and adverse costs insurance. A full copy of the judgment is available at the link above.
Since the hearing before the Court in February 2017 which prompted the direction from the Court, the Action Group has secured fully committed funding to pay for the trial through to the end of Trial 1 and has, with help from Manx, a major Claimant, entered into productiveÂ discussions with new providers of additional ATE in an effort to provide as much protection for its members against adverse costs as possible.
We hope that this is of considerable comfort to the Action Group's members, particularly in light of the Court's concerns raised in February of this year.
On the 16th March the Action Group delegated the management of the RBS Rights Issue Litigation to Manx Capital Partners Limited.
Manx is part of the same group that owns London & Northern Capital Partners Limited, which provided funding to the Action Group last year, to which Manx has now added further substantial funding.
Manx and London & Northern are part of a business group, who has been supportive of the Action Group and the work of the litigation team from the outset of the claims against RBS and its former directors.
For your information, the judgement and the extracted paragraphs set out below will remain on the Action Group's website until further notice.
127. The one further point to which I have alluded above is this: although I have concluded that I should not accede to the second limb of the Defendants' application, I remain concerned about the position as to the SG Group's ATE cover, especially in the context of what individual claimants have been told or may perceive the position to be. I have been increasingly troubled by the inconsistency of statements made with respect to the ATE cover for these proceedings; and other statements (at least one plainly inaccurate) have apparently been made, unapproved and indeed without the knowledge of the Claimants' solicitors.
128. Indeed, I have also become concerned whether there is sufficient funding, especially given the likelihood that members of the Action Group are likely to have signed up on the basis of there being adequate funding, but the contrasting statements by Mr Huntley in his recent witness statements that more is needed. Plainly there could be serious consequences to the Claimants themselves if there is any gap or shortfall in funding, as there would be in the case of ATE cover. The Court, in managing the proceedings, has an interest in ensuring that its own resources (and thus the public purse) are not wasted unnecessarily and (in the context of a GLO especially) in having some assurance (subject, of course, to protection of privilege) that the basis of participation has been fairly and fully represented.
129. The focus of these concerns is not recoverability of costs from the Defendants' point of view, rather it is as to the basis on which (a) existing claimants are, since the December Settlements, participating, and (even now, after the apparent expiry of the primary limitation period) further claimants are being invited to participate under the GLO and (b) the court is proceeding, given earlier assurances given as to ATE cover and the funding arrangements in place.
130. The correspondence between the SG Group and actual and potential claimants which I have been shown reveals a somewhat unsettling uncertainty as to what such claimants may perceive their exposure to be, and thus as to the basis on which they are proceeding since the December Settlements.
131. As for the Court itself, whilst acknowledging that neither the GLO, nor the order under that umbrella for several and not joint liability for costs, expressly stipulated cover to be a condition, the clear impression imparted was that both adequate funding and ATE cover were and would remain in place. The Court has case-managed the proceedings accordingly.
132. The December Settlements were, as I have said, a watershed, and almost inevitably required a review of the case as a whole, including its funding: time for that was sought by the Claimants and granted (by way of a short stay). It is discomfiting that so little, and no concrete, information has been provided as regards the basis on which, in point of both fact and perception, the claim is proceeding, beyond an assurance through Counsel that some (otherwise unspecified) ATE cover is in place, and that what I take to be the main funder is now an offshore entity of which no details have been provided or seem to be available.
133. It may be that the fact of my expression of concern will promote sufficient enquiry by claimants to encourage the SG Group to address the matter from their point of view. But in light of the concerns I have expressed I think it appropriate and necessary that there should be more transparency as to the funding position and ATE cover. I do not wish to promote an interrogation, or by a side-wind encourage further satellite applications. But after this judgment is formally handed down, I would invite submissions as to what else might, in a reasonably confined way, be done or directed further to address these concerns.