Litigation 2025 – Maltin PR trends and developments update for Chambers and Partners
England and Wales remains one of the world’s most prominent jurisdictions for both litigation and arbitration following the UK’s departure from the EU. The reputation of London’s commercial courts for impartiality and independence is reflected in the international appeal, with them handing down a higher value of judgments than either New York or Singapore, and English law underpinning multiple billions of pounds of contracts, trades and deals. The Law Society of England and Wales has stated that legal services are worth GBP60 billion to the United Kingdom’s economy, and the knock-on impact of the jurisdiction’s legal appeal into other sectors cannot be underestimated.
While the widespread use of English law for contracts leads to strong M&A and commercial law sectors, the more visible side of legal London is the booming litigation market. Whether they are contractual disputes, collective actions, defamation proceedings or high-value divorce proceedings, London hears some of the largest cases, which naturally comes with an intense level of scrutiny from the media and the public. The international nature of many of the disputes results in attention from media in other jurisdictions, with resultant impacts on the reputations of international litigants.
Major Cases
The strength of London’s litigation market is highlighted by the decision of the Federal Republic of Nigeria to bring a claim contesting the result of a London-seated arbitration in the London High Court. In a seismic decision, The Hon. Mr Justice Knowles found in October 2023 that the initial arbitration result had been obtained by fraud, overturning the USD6.6 billion arbitration award against Nigeria (which, by 2023, totalled USD11 billion including interest). Mr Justice Knowles did not shy away from highlighting the failures that he found to have taken place in the underlying proceedings, which placed the piercing glare of the industry on arbitration processes that are intentionally shrouded by privacy. Though raising questions about English arbitration in the short term, such commitment to protecting the longer-term performance of the British legal sector highlights exactly why the jurisdiction attracts such high-value and contentious matters.
A willingness to deal with previous findings of courts and tribunals that were procured by wrongdoing can also be seen in other cases. In March 2024, the High Court ordered that two earlier judgments – one of the High Court and the other of the Court of Appeal, be set aside having been “procured by fraud”. The underlying case, Ras Al Khaimah Investment Authority v Farhad Azima, had commenced in 2016 and since inception had seen allegations of hacking against the claimant by the defendant. The eventual judgment against Ras Al Khaimah Investment Authority highlighted that the courts will not tolerate extensive wrongdoing in bringing claims in the jurisdiction, with a worldwide freezing order being granted after the Investment Authority fled the jurisdiction and repeatedly refused to comply with costs orders against it.
In a further rebuke of potential misuse of the English courts, Mr Justice Calver found in favour of Russian billionaire Oleg Deripaska, who sought to secure the disclosure of an allegedly forged report that had been deployed against him in a dispute with Vladimir Chernukhin. The case was brought against Quinn Emanuel Urquhart & Sullivan, who acted for Chernukhin. Quinn Emanuel sought to argue that the identity of the firm which provided them with the report was protected by legal professional privilege, which was rejected in a judgment that found that it was “strongly arguable” that the report was forged to deceive the English courts, and that disclosing the name of the firm was “a necessary and proportionate response to this serious wrongdoing”.
The English courts also played host to, and resolved, a long-running dispute in the cryptocurrency space. The case centred on whether or not Dr Craig Wright is “Satoshi Nakamoto”, the inventor of Bitcoin. The Crypto Open Patent Alliance (COPA) was seeking a declaration from the court that Dr Wright did not pen the Bitcoin White Paper, a 2008 document that served as the foundation of Bitcoin and, by extension, numerous other cryptocurrencies. Other cases hung on the judgment in this matter, with Dr Wright seeking to litigate against a number of companies that he claimed had infringed his intellectual property by developing Bitcoin.
Immediately after the conclusion of a five-week trial, Mr Justice Mellor ruled that “Dr Wright is not the person who adopted or operated under the pseudonym Satoshi Nakamoto”, before handing down a full written judgment two months later. While rare, the decision to provide an ex tempore judgment reflected both the seriousness of the case and the wider implications of the declaration sought, as well as the nature of the evidence against Dr Wright, which Mr Justice Mellor referred to as “overwhelming”. Following the hand-down of his written judgment, Dr Wright’s actions were referred to the Crown Prosecution Service by the judge, based on his having committed “a most serious abuse” of the court processes in the “UK, Norway and the USA”.
A further major case has been the jurisdictional dispute in a billion-pound aviation litigation emerging from planes being stranded in Russia following the Russian invasion of Ukraine in 2022. Despite aircraft insurers having clauses in their contracts requiring any disputes with aircraft lessors to be litigated in Russia, the English courts held that it would be inappropriate to stay the proceedings so that these clauses could be adhered to. In a judgment over 500 paragraphs long, Mr Justice Henshaw found that the claimants were “very unlikely to obtain a fair trial in Russia”, that there was a “far greater risk of inconsistent findings on fundamental issues” and an “inevitability of increased multiplicity of proceedings”.
By contrast, in separate proceedings relating to aircraft stranded in Ukraine, Mr Justice Henshaw found that the exclusive jurisdiction clauses relating to Ukraine should stand. The analysis undertaken and balancing tests applied in such cases remain a powerful draw for litigants in the jurisdiction. With few exceptions relating to matters of public policy, English courts undertake careful and considered factual analysis to ensure that justice is done. As a result, the cases will now proceed in the jurisdiction where justice is most likely to be served, this taken by the court as more important than a strict adherence to the terms of a contract.
Reputation and Litigation
The public nature of litigation in England and Wales, unless ordered otherwise, can create major reputational concerns for any litigants. With the prevalence of litigants that are based outside the jurisdiction and have a public profile, this can present a challenge to a company reputation. Publicly listed companies, in particular, are vulnerable to information emerging during the course of litigation. Share prices are potentially at risk should potentially compromising material or allegations be aired in open court.
The absolute privilege afforded to journalists to report on live proceedings in the courtroom, and on materials filed in legal documents, can result in damaging information being made public. Where information can now remain online and easily accessible for many years, contemporaneous court reports can form part of a company’s reputation for years to come where previously they may have faded into memory. Ensuring that a comprehensive strategy is in place to deal with the risks that are known as litigation is being contemplated, which can be refined as a case develops, is paramount – something that is increasingly recognised by legal teams. Lawyers are often now expected to be able to advise on such topics, and help guide clients through the public impact of litigation, whether themselves or working with other specialists.
As well as forming part of the legal strategy, the reputational aspects of a litigation can sometimes outweigh the strength of the legal case. While rare, such circumstances can arise where information would be made public that provides an existential threat to a company’s ability to continue to do business. As an example, while the legal case against an ex-employee may be strong, allegations of racism and abuse from management may serve to damage a business’ relationship with other employees, stakeholders and business partners. Similarly, references to dishonesty in agreements with other companies in internal emails revealed in disclosure and read into open court may impact on the ability of a company to win new business. In such circumstances, consideration should be given to whether the information about to emerge is damaging enough to justify seeking to settle ahead of this occurring.
On the other hand, the implicit threat of reputational damage is often used by claimants in both the various forms of group and collective proceedings in the English courts against the typically corporate defendants, as well as in other corporate disputes where one side may have more to lose in the press than the other. Securing media coverage can often influence the strategy of counterparties, with the protections afforded to reporters serving to assist in the publication of articles that would otherwise not be possible. Even with this, however, coverage will always include the arguments of both sides, reflecting the filings in the legal proceedings.
While litigation can impact on reputation, it can also be deployed in an effort to protect reputation. Defamation proceedings, or the threat of them, have often been used to seek to prevent media coverage pre-publication. There continues to be a public backlash over SLAPPs – strategic lawsuits against public participation – which have no fixed definition under law but have attracted extensive public, political and journalistic opprobrium. A Private Members bill was seeking to legislate against such litigation, but did not pass any law before the July 2024 election, and the new Labour government has indicated that it has no intention of legislating on this quickly.
Quite aside from the legal and regulatory questions around SLAPPs – with the Solicitors Disciplinary Tribunal scheduled to hear a case against a solicitor over an alleged SLAPP in December 2024 – they often backfire in terms of seeking to protect a reputation. The fact of a case being brought against a journalist tends to amplify the initial reporting, as any legal proceedings will inevitably result in further media coverage as they proceed. Careful management of pre-publication correspondence, without legal threats, can result in the removal of any false allegations from coverage if evidence exists to rebut them. A heavy-handed approach will often have the opposite effect, particularly if there is no direct evidence to undermine the allegations being made.
Litigation Funding and Collective Actions
The London litigation market continues to see extensive activity in the collective action space. This level of activity has continued despite the Supreme Court judgment in PACCAR and others v Competition Appeal Tribunal and others, which threw the litigation funding market into turmoil in July 2023. The Supreme Court found that litigation funding agreements that entitle funders to payment based on the quantity of damages recovered during a case are damages-based agreements, with the additional regulatory oversight that this entails.
Legislation introduced by the previous government in March 2024 sought to deal with the fallout from the PACCAR judgment, however this has been shelved by the new Labour government, leaving the issues in play. The impact of the judgment was noted in the explanatory notes to the bill:
“The Supreme Court judgment rendered LFAs unenforceable. Uncertainty around litigation funding risks a detrimental impact on the attractiveness of the England and Wales jurisdiction as a global hub for commercial litigation and arbitration, and on access to justice more broadly.”
While the industry waits for further developments on this front, efforts are made to establish alternative forms of funding that permit cases to continue. However, the risks of a technical challenge to funding arrangements makes this a somewhat risky prospect. The government has stated its intention to wait for a report from the Civil Justice Council on litigation funding before drawing up fresh legislation, with the full report expected in summer 2025. In the meantime, there is a risk that other jurisdictions which have clearer regimes around litigation funding may otherwise reap the benefits of the sector.
Despite issues around funding noted above, collective litigation in England and Wales continues to go from strength to strength. The limitations placed on representative actions following the Supreme Court judgment in Lloyd v Google are beginning to be established in lower courts, with the concerns that such actions may no longer be feasible as a result of having to prove common interest proving to be inaccurate.
Major cases also continue to develop through the courts, with the litigation regarding the Mariana Dam Disaster commencing in October 2024. Claimed to be the largest group action in the world, by both quantum – estimated at GBP33.6 billion – and by number of claimants – over 620,000 – it has seen extensive jurisdictional challenges to get to this point. At first instance the claim was struck out for being “unmanageable”, before this point was overturned on appeal and the claim permitted to proceed. Should the case be successful, it will mark a watershed moment that highlights the strength of the English courts’ ability to handle complex and wide-ranging cases with a genesis in other jurisdictions.
As touched on above, the media plays a vital role in collective actions, both for claimants and defendants. For the former, positive media coverage provides a vital form of third-party endorsement that can assist in supporting paid-for advertising, with a view towards attracting more claimants to a firm’s group. In an increasingly competitive market, this can be vital. For defendants, corporate reputations can be heavily damaged by collective actions being brought, necessitating proactive efforts to minimise the damage that is caused.
Conclusion
London remains one of the pre-eminent dispute resolution centres in the world, with English law retaining a great deal of respect for both corporates and (ultra)-high net worth individuals in many other jurisdictions. The public nature of the majority of proceedings serves to ensure that justice is seen to be done, but this can also create reputational risks for litigants. Reputation services are accordingly increasingly considered part-and-parcel of a legal offering for firms, such as with the launch of reputation management arms of law firms and the rise of specialist litigation PR firms. In a world where both the results of a litigation and the reporting that occurs during hearings can form a part of a company’s online footprint for years after the fact, ensuring that both legal and media strategies are fully considered when entering the courts is increasingly vital.
James Lynch, Partner, Maltin PR
This article was first published by Chambers and Partners, here.